INTERPLEADER that the membership fee certificate 201-serial no.
1199 held by the defendant Tan
G.R. No. L-23851 March 26, 1976
WACK WACK GOLF & COUNTRY CLUB, INC., plaintiff-appellant,
vs.
LEE E. WON alias RAMON LEE and BIENVENIDO A. TAN, defendants-
appellees.
CASTRO, C.J.:
This is an appeal from the order of the Court of First Instance of Rizal, in civil case
7656, dismissing the plaintiff-appellant's complaint of interpleader upon the
grounds of failure to state a cause of action and res judicata.
In its amended and supplemental complaint of October 23, 1963, the Wack Wack
Golf & Country Club, Inc., a non-stock, civic and athletic corporation duly
organized under the laws of the Philippines, with principal office in Mandaluyong,
Rizal (hereinafter referred to as the Corporation), alleged, for its first cause of
action, that the defendant Lee E. Won claims ownership of its membership fee
certificate 201, by virtue of the decision rendered in civil case 26044 of the CFI of
Manila, entitled "Lee E. Won alias Ramon Lee vs. Wack Wack Golf & Country
Club, Inc." and also by virtue of membership fee certificate 201-serial no. 1478
issued on October 17, 1963 by Ponciano B. Jacinto, deputy clerk of court of the
said CFI of Manila, for and in behalf of the president and the secretary of the
Corporation and of the People's Bank & Trust Company as transfer agent of the
said Corporation, pursuant to the order of September 23, 1963 in the said case;
that the defendant Bienvenido A. Tan, on the other hand, claims to be lawful owner
of its aforesaid membership fee certificate 201 by virtue of membership fee
certificate 201-serial no. 1199 issued to him on July 24, 1950 pursuant to an
assignment made in his favor by "Swan, Culbertson and Fritz," the original owner
and holder of membership fee certificate 201; that under its articles of
incorporation and by-laws the Corporation is authorized to issue a maximum of
400 membership fee certificates to persons duly elected or admitted to proprietary
membership, all of which have been issued as early as December 1939; that it
claims no interest whatsoever in the said membership fee certificate 201; that it
has no means of determining who of the two defendants is the lawful owner
thereof; that it is without power to issue two separate certificates for the same
membership fee certificate 201, or to issue another membership fee certificate to
the defendant Lee, without violating its articles of incorporation and by-laws; and
and the membership fee certificate 201-serial No. 1478 issued to the defendant
Lee proceed from the same membership fee certificate 201, originally issued in the
name of "Swan, Culbertson and Fritz".
For its second cause of action. it alleged that the membership fee certificate 201-
serial no. 1478 issued by the deputy clerk of court of court of the CFI of Manila in
behalf of the Corporation is null and void because issued in violation of its by-laws,
which require the surrender and cancellation of the outstanding membership fee
certificate 201 before issuance may be made to the transferee of a new certificate
duly signed by its president and secretary, aside from the fact that the decision of
the CFI of Manila in civil case 26044 is not binding upon the defendant Tan, holder
of membership fee certificate 201-serial no. 1199; that Tan is made a party
because of his refusal to join it in this action or bring a separate action to protect
his rights despite the fact that he has a legal and beneficial interest in the subject
matter of this litigation; and that he is made a part so that complete relief may be
accorded herein.
The Corporation prayed that (a) an order be issued requiring Lee and Tan to
interplead and litigate their conflicting claims; and (b) judgment. be rendered, after
hearing, declaring who of the two is the lawful owner of membership fee certificate
201, and ordering the surrender and cancellation of membership fee certificate
201-serial no. 1478 issued in the name of Lee.
In separate motions the defendants moved to dismiss the complaint upon the
grounds of res judicata, failure of the complaint to state a cause of action, and bar
by prescription. 1 These motions were duly opposed by the Corporation. Finding
the grounds of bar by prior judgment and failure to state a cause of action well
taken, the trial court dismissed the complaint, with costs against the Corporation.
In this appeal, the Corporation contends that the court a quo erred (1) in finding
that the allegations in its amended and supplemental complaint do not constitute a
valid ground for an action of interpleader, and in holding that "the principal motive
for the present action is to reopen the Manila Case and collaterally attack the
decision of the said Court"; (2) in finding that the decision in civil case 26044 of the
CFI of Manila constitutes res judicata and bars its present action; and (3) in
dismissing its action instead of compelling the appellees to interplead and litigate
between themselves their respective claims.
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The Corporations position may be stated elsewise as follows: The trial court erred
in dismissing the complaint, instead of compelling the appellees to interplead
because there actually are conflicting claims between the latter with respect to the
ownership of membership fee certificate 201, and, as there is not Identity of
parties, of subject-matter, and of cause of action, between civil case 26044 of the
CFI of Manila and the present action, the complaint should not have been
dismissed upon the ground of res judicata.
On the other hand, the appellees argue that the trial court properly dismissed the
complaint, because, having the effect of reopening civil case 26044, the present
action is barred by res judicata.
Although res judicata or bar by a prior judgment was the principal ground availed
of by the appellees in moving for the dismissal of the complaint and upon which
the trial court actually dismissed the complaint, the determinative issue, as can be
gleaned from the pleadings of the parties, relates to the propriety and timeliness of
the remedy of interpleader.
The action of interpleader, under section 120 of the Code of Civil Procedure, 2 is a
remedy whereby a person who has personal property in his possession, or an
obligation to render wholly or partially, without claiming any right to either, comes
to court and asks that the persons who claim the said personal property or who
consider themselves entitled to demand compliance with the obligation, be
required to litigate among themselves in order to determine finally who is entitled to
tone or the one thing. The remedy is afforded to protect a person not against
double liability but against double vexation in respect of one liability. 3 The
procedure under the Rules of Court 4 is the same as that under the Code of Civil
Procedure, 5 except that under the former the remedy of interpleader is available
regardless of the nature of the subject-matter of the controversy, whereas under
the latter an interpleader suit is proper only if the subject-matter of the controversy
is personal property or relates to the performance of an obligation.
There is no question that the subject matter of the present controversy, i.e., the
membership fee certificate 201, is proper for an interpleader suit. What is here
disputed is the propriety and timeliness of the remedy in the light of the facts and
circumstances obtaining.
A stakeholder 6 should use reasonable diligence to hale the contending claimants
to court. 7 He need not await actual institution of independent suits against him
before filing a bill of interpleader. 8 He should file an action of interpleader within a
reasonable time after a dispute has arisen without waiting to be sued by either of
the contending claimants. 9 Otherwise, he may be barred by laches 10 or undue
delay. 11 But where he acts with reasonable diligence in view of the environmental
circumstances, the remedy is not barred. 12
Has the Corporation in this case acted with diligence, in view of all the
circumstances, such that it may properly invoke the remedy of interpleader? We do
not think so. It was aware of the conflicting claims of the appellees with respect to
the membership fee certificate 201 long before it filed the present interpleader suit.
It had been recognizing Tan as the lawful owner thereof. It was sued by Lee who
also claimed the same membership fee certificate. Yet it did not interplead Tan. It
preferred to proceed with the litigation (civil case 26044) and to defend itself
therein. As a matter of fact, final judgment was rendered against it and said
judgment has already been executed. It is not therefore too late for it to invoke the
remedy of interpleader.
It has been held that a stakeholder's action of interpleader is too late when filed
after judgment has been rendered against him in favor of one of the contending
claimants, 13 especially where he had notice of the conflicting claims prior to the
rendition of the judgment and neglected the opportunity to implead the adverse
claimants in the suit where judgment was entered. This must be so, because once
judgment is obtained against him by one claimant he becomes liable to the
latter. 14 In once case, 15 it was declared:
The record here discloses that long before the rendition of the
judgment in favor of relators against the Hanover Fire Insurance
Company the latter had notice of the adverse claim of South to the
proceeds of the policy. No reason is shown why the Insurance
Company did not implead South in the former suit and have the
conflicting claims there determined. The Insurance Company
elected not to do so and that suit proceeded to a final judgment in
favor of relators. The Company thereby became independently
liable to relators. It was then too late for such company to invoke
the remedy of interpleader
The Corporation has not shown any justifiable reason why it did not file an
application for interpleader in civil case 26044 to compel the appellees herein to
litigate between themselves their conflicting claims of ownership. It was only after
adverse final judgment was rendered against it that the remedy of interpleader was
invoked by it. By then it was too late, because to he entitled to this remedy the
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applicant must be able to show that lie has not been made independently liable to
any of the claimants. And since the Corporation is already liable to Lee under a
final judgment, the present interpleader suit is clearly improper and unavailing.
It is the general rule that before a person will be deemed to be in a
position to ask for an order of intrepleader, he must be prepared to
show, among other prerequisites, that he has not become
independently liable to any of the claimants. 25 Tex. Jur. p. 52,
Sec. 3; 30 Am. Jur. p. 218, Section 8.
It is also the general rule that a bill of interpleader comes too late
when it is filed after judgment has been rendered in favor of one of
the claimants of the fund, this being especially true when the
holder of the funds had notice of the conflicting claims prior to the
rendition of the judgment and had an opportunity to implead the
adverse claimants in the suit in which the judgment was
rendered. United Procedures Pipe Line Co. v. Britton, Tex. Civ.
App. 264 S.W. 176; Nash v. McCullum, Tex. Civ. 74 S.W. 2d
1046; 30 Am. Jur. p. 223, Sec. 11; 25 Tex. Jur. p. 56, Sec. 5; 108
A.L.R., note 5, p. 275. 16
Indeed, if a stakeholder defends a suit filed by one of the adverse claimants and
allows said suit to proceed to final judgment against him, he cannot later on have
that part of the litigation repeated in an interpleader suit. In the case at hand, the
Corporation allowed civil case 26044 to proceed to final judgment. And it offered
no satisfactory explanation for its failure to implead Tan in the same litigation. In
this factual situation, it is clear that this interpleader suit cannot prosper because it
was filed much too late.
If a stakeholder defends a suit by one claimant and allows it to
proceed so far as a judgment against him without filing a bill of
interpleader, it then becomes too late for him to do so. Union Bank
v. Kerr, 2 Md. Ch. 460; Home Life Ins. Co. v. Gaulk, 86 Md. 385,
390, 38 A. 901; Gonia v. O'Brien, 223 Mass. 177, 111 N.E. 787. It
is one o the main offices of a bill of interpleader to restrain a
separate proceeding at law by claimant so as to avoid the
resulting partial judgment; and if the stakeholder acquiesces in
one claimant's trying out his claim and establishing it at law, he
cannot then have that part of the litigation repeated in an
interpleader suit. 4 Pomeroy's Eq. Juris. No. 162; Mitfor's Eq.
Pleading (Tyler's Ed.) 147 and 236; Langdell's Summary of Eq.
Pleading, No. 162' De Zouche v. Garrizon, 140 Pa. 430, 21
A/450. 17
It is the general rule that a bill of interpleader comes too late when
application therefore is delayed until after judgment has been
rendered in favor of one of the claimants of the fund, and that this
is especially true where the holder of the fund had notice of the
conflicting claims prior to the rendition of such judgment and an
opportunity to implead the adverse claimants in the suit in which
such judgment was rendered. (See notes and cases cited 36 Am.
Dec. 703, Am. St. Rep. 598, also 5 Pomeroy's Eq. Juris. Sec. 41.)
The evidence in the opinion of the majority shows beyond dispute
that the appellant permitted the Parker county suit to proceed to
judgment in favor of Britton with full notice of the adverse claims of
the defendants in the present suit other than the assignees of the
judgment (the bank and Mrs. Pabb) and no excuse is shown why
he did not implead them in the suit. 18
To now permit the Corporation to bring Lee to court after the latter's successful
establishment of his rights in civil case 26044 to the membership fee certificate
201, is to increase instead of to diminish the number of suits, which is one of the
purposes of an action of interpleader, with the possibility that the latter would lose
the benefits of the favorable judgment. This cannot be done because having
elected to take its chances of success in said civil case 26044, with full knowledge
of all the fact, the Corporation must submit to the consequences of defeat.
The act providing for the proceeding has nothing to say touching
the right of one, after contesting a claim of one of the claimants to
final judgment unsuccessfully, to involve the successful litigant in
litigation anew by bringing an interpleader action. The question
seems to be one of first impression here, but, in other jurisdictions,
from which the substance of the act was apparently taken, the rule
prevails that the action cannot be resorted to after an unsuccessful
trial against one of the claimants.
It is well settled, both by reasons and authority, that one who asks
the interposition of a court of equity to compel others, claiming
property in his hands, to interplead, must do so before putting
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 them to the test of trials at law. Yarborough v. Thompson, 3
Smedes & M. 291 (41 Am. Dec. 626); Gornish v. Tanner, 1 You. &
Jer. 333; Haseltine v. Brickery, 16 Grat. (Va.) 116. The remedy by
interpleader is afforded to protect the party from the annoyance
and hazard of two or more actions touching the same property or
demand; but one who, with knowledge of all the facts, neglects to
avail himself of the relief, or elects to take the chances for success
in the actions at law, ought to submit to the consequences of
defeat. To permit an unsuccessful defendant to compel the
successful plaintiffs to interplead, is to increase instead of to
diminish the number of suits; to put upon the shoulders of others
the burden which he asks may be taken from his own. ....'
It is urged, however, that the American Surety Company of New
York was not in position to file an interpleader until it had tested
the claim of relatrix to final judgment, and that, failing to meet with
success, it promptly filed the interpleader. The reason why, it
urges, it was not in such position until then is that had it
succeeded before this court in sustaining its construction of the
bond and the law governing the bond, it would not have been
called upon to file an interpleader, since there would have been
sufficient funds in its hands to have satisfied all lawful claimants. It
may be observed, however, that the surety company was
acquainted with all of the facts, and hence that it simply took its
chances of meeting with success by its own construction of the
bond and the law. Having failed to sustain it, it cannot now force
relatrix into litigation anew with others, involving most likely a
repetition of what has been decided, or force her to accept a pro
rata part of a fund, which is far from benefits of the judgment. 19
Besides, a successful litigant cannot later be impleaded by his defeated adversary
in an interpleader suit and compelled to prove his claim anew against other
adverse claimants, as that would in effect be a collateral attack upon the judgment.
The jurisprudence of this state and the common law states is well-
settled that a claimant who has been put to test of a trial by a
surety, and has establish his claim, may not be impleaded later by
the surety in an interpleader suit, and compelled to prove his claim
again with other adverse claimants. American Surety Company of
New York v. Brim, 175 La. 959, 144 So. 727; American Surety
Company of New York v. Brim (In Re Lyong Lumber Company),
176 La. 867, 147 So. 18; Dugas v. N.Y. Casualty Co., 181 La.
322, 159 So. 572; 15 Ruling Case Law, 228; 33 Corpus Juris, 477;
4 Pomeroy's Jurisprudence, 1023; Royal Neighbors of America v.
Lowary (D.C.) 46 F2d 565; Brackett v. Graves, 30 App. Div. 162,
51 N.Y.S. 895; De Zouche v. Garrison, 140 Pa. 430, 21 A. 450,
451; Manufacturer's Finance Co. v. W.I. Jones Co. 141 Ga., 519,
81 S.E. 1033; Hancock Mutual Life Ins. Co. v. Lawder, 22 R.I. 416,
84 A. 383.
There can be no doubt that relator's claim has been finally and
definitely established, because that matter was passed upon by
three courts in definitive judgments. The only remaining item is the
value of the use of the land during the time that relator occupied it.
The case was remanded solely and only for the purpose of
determining the amount of that credit. In all other aspects the
judgment is final. 20
It is generally held by the cases it is the office of interpleader to
protect a party, not against double liability, but against double
vexation on account of one liability. Gonia v. O'Brien, 223 Mass.
177, 111 N.E. 787. And so it is said that it is too late for the
remedy of interpleader if the party seeking this relef has contested
the claim of one of the parties and suffered judgment to be taken.
In United P.P.I. Co. v. Britton (Tex. Civ. App.) 264 S.W. 576. 578,
it was said: 'It is the general rule that a bill of interpleader comes
too late when application therefor is delayed until after judgment
has been rendered in favor of one of the claimants of the fund,
and this is especially true where the holder of the fund had notice
of the conflicting claims prior to the rendition of such judgment and
an opportunity to implead the adverse claimants in the suit in
which such judgment was rendered. See notes and cases cited 35
Am. Dec. 703; 91 An. St. Rep. 598; also 5 Pomeroy's Equity
Jurisprudence No. 41.'
The principle thus stated has been recognized in many cases in
other jurisdictions, among which may be cited American Surety
Co. v. O'Brien, 223 Mass. 177, 111 N.E. 787; Phillips v. Taylor,
148 Md. 157, 129 A. 18; Moore v. Hill, 59 Ga. 760,
761; Yearborough v. Thompson, 3 Smedes & M. (11 Miss.) 291,
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 41 Am. Dec. 626. See, also, 33 C.J. p. 447, No. 30; Nash v.
McCullum, (Tex. Civ. App.) 74 S.W. 2d 1042, 1047.
It would seem that this rule should logically follow since, after the
recovery of judgment, the interpleading of the judgment creditor is
in effect a collateral attack upon the judgment. 21
In fine, the instant interpleader suit cannot prosper because the Corporation had
already been made independently liable in civil case 26044 and, therefore, its
present application for interpleader would in effect be a collateral attack upon the
final judgment in the said civil case; the appellee Lee had already established his
rights to membership fee certificate 201 in the aforesaid civil case and, therefore,
this interpleader suit would compel him to establish his rights anew, and thereby
increase instead of diminish litigations, which is one of the purposes of an
interpleader suit, with the possiblity that the benefits of the final judgment in the
said civil case might eventually be taken away from him; and because the
Corporation allowed itself to be sued to final judgment in the said case, its action of
interpleader was filed inexcusably late, for which reason it is barred by laches or
unreasonable delay.
ACCORDINGLY, the order of May 28, 1964, dismissing the complaint, is affirmed,
at appellant's cost.
G.R. No. 73794 September 19, 1988
ETERNAL GARDENS MEMORIAL PARKS CORPORATION, petitioner,
vs.
FIRST SPECIAL CASES DIVISION INTERMEDIATE APPELLATE COURT and
NORTH PHILIPPINE UNION MISSION OF THE SEVENTH-DAY
ADVENTISTS, respondents.
PARAS, J.:
This is a special civil action for certiorari, prohibition and mandamus seeking to set
aside the two resolutions of public respondent First Special Cases Division of the
then Intermediate Appellate Court in AC-G.R. No. 04869 entitled "North Philippine
Union Mission of the Seventh Day Adventists versus Hon. Antonia Corpus-
Macandog, Presiding Judge, Branch CXX, Regional Trial Court, Caloocan City and
Eternal Gardens Memorial Park Corporation, (a) dated September 5, 1985 (Rollo,
pp. 21-25) reconsidering its Decision 1 of February 27, 1985 (Rollo, pp. 38-48) and
ordering petitioner to deposit whatever amounts due from it under the Land
Development Agreement, and (b) dated February 13, 1986 (Rollo, p. 27) denying
for lack of merit petitioner's motion for reconsideration.
Petitioner Eternal Gardens Memorial Parks Corporation and private respondent
North Philippine Union Mission Corporation of the Seventh Day Adventists
(MISSION for short) are corporations duly organized and existing under and by
virtue of the laws of the Republic of the Philippines.
They executed a Land Development Agreement (Rollo, pp. 179-182) on October 6,
1976 whereby the former undertook to introduce and construct at its own expense
and responsibility necessary improvements on the property owned by private
respondent into a memorial park to be subdivided into and sold as memorial plot
lots, at a stipulated area and price per lot. Out of the proceeds from the sale,
private respondent is entitled to receive 40% of the net gross collection from the
project to be remitted monthly by petitioner to private respondent through a
designated depositary trustee bank. On the same date private respondent
executed in petitioner's favor a Deed of Absolute Sale with Mortgage (Rollo, pp.
183-186) on the lots with titles involved in the land development project. The deed
was supplemented by a Sale of Real Property with Mortgage and Special
Conditions dated October 28, 1978 (Rollo, pp. 189-194 The amounts totalling
about P984,110.82 paid by petitioner were to be considered as part of the 40%
due private respondent under the Land Development Agreement. All went well
until Maysilo Estate asserted its claim of ownership over the parcel of land in
question. Confronted with such conflicting claims, petitioner as plaintiff filed a
complaint for interpleader (Rollo, pp. 169-179) against private respondent
MISSION and Maysilo Estate, docketed as Special Court Case No. C-9556 of the
then CFI of Rizal, Branch XII, Caloocan, alleging among others, that in view of the
conflicting claims of ownership of the defendants (herein private respondent and
Maysilo Estate) over the properties subject matter of the contracts, over which
plaintiff corporation (herein petitioner) has no claim of ownership except as a
purchaser thereof, and to protect the interests of plaintiff corporation which has no
interest in the subject matter of the dispute and is willing to pay whoever is entitled
or declared to be the owners of said properties, the defendants should be required
to interplead and litigate their several claims between themselves (Rollo, p. 177).
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An order was issued by the presiding judge 2 requiring defendants to interplead on
October 22, 1981. MISSION filed a motion to dismiss dated November 10, 1981
for lack of cause of action but also presented an answer dated November 12,
1981. The motion to dismiss was denied in an Order dated January 12, 1982. The
heirs of Maysilo Estate filed their own answer dated November 11, 1981 and an
amended answer dated October 20, 1983 thru the estate's special receiver. The
heirs of Pedro Banon filed an "Answer in Intervention with Special and Affirmative
Defenses" dated October 24, 1983, while Lilia B. Sevilla and husband Jose Seelin
filed their "Answer in Cross-claim" dated October 31, 1983 (Rollo, p. 30). The heirs
of Sofia O'Farrel y Patino, et al. filed their Answer in Intervention dated November
10, 1983.
However, earlier on November 21, 1982, private respondent presented a motion
for the placing on judicial deposit the amounts due and unpaid from petitioner.
Acting on such motion, the trial court 3 denied judicial deposit in its order dated
February 13, 1984, the decretal portion of which reads:
PREMISES CONSIDERED, all or the full amount the plaintiff,
Eternal Gardens Memorial Parks Corporation have already paid
the North Philippine Union Mission Corporation of the Seventh
Day Adventist is hereby ordered to deposit the same to this Court
within thirty (30) days from receipt of this order considering that
real or true owner of the subject properties in question, due
hearing of this court has yet to be undergone in order to decide as
to who is the true owner which is a prejudicial question. Hence the
motion dated November 21, 1983 of the NPUM for the Eternal
Gardens Corporation to deposit the balance due and unpaid is
hereby ordered denied and the opposition thereto dated
December 19, 1983 is hereby ordered granted.
The contract between the Eternal Gardens Corporation and the
North Philippine Union Mission dated October 16, 1976 is ordered
and declared ineffective as of today, February 13, 1984 because
the subject matter of the sale is not existing between the
contracting parties until after the question of ownership is resolved
by this court. The court will order the revival of the contract if the
North Philippine Union Mission will win.
If not, the declared winner among the intervenors will be the party
to enter into a contract of sale with the plaintiff as aforementioned.
(Rollo, p. 66).
Another order dated October 26, 1984 was issued amending the February 13,
1984 order and setting aside the order for private respondent's deposit of the
amounts it had previously received from petitioner, thus:
WHEREFORE IN VIEW OF ALL THE FOREGOING
CONSIDERATIONS the order of February 13, 1984, is hereby
ordered amended, reconsidered and modified by this same Court
as follows:
(a) The order directing the NORTH PHILIPPINE UNION MISSION
CORPORATION OF SEVENTH-DAY ADVENTISTS to deposit the
amounts it received under the implementation of the LAND
DEVELOPMENT AGREEMENT which is not questioned by the
plaintiff, Eternal Gardens, is hereby ordered set aside for the
reason that the titles to ownership, the North Philippine Union
Mission Corporation of Seventh Day Adventists on the lots subject
matter of the aforesaid agreement is not established invalid, and
the alleged titles of intervenors are not proven yet by competent
evidence;
(b) The motion to require Eternal Gardens to deposit the balance
under the Land Development Agreement is likewise hereby
ordered denied considering the fact the aforesaid plaintiff had not
denied its obligations under the aforesaid contract; and
(c) The trial or hearing is hereby ordered as scheduled to proceed
on November 29, 1984 and on December 6, 1984 at 8:30 in the
morning per order of this Court dated October 4, 1984 in order to
determine the alleged claims of ownership by the intervenors and
all claims and allegations of each party to the instant" case will be
considered and decided carefully by this court on just and
meritorious grounds. (Rollo, p. 39)
Said Orders were assailed twice in the Intermediate Appellate Court (Court of
Appeals) and in the Supreme Court as follows:
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In G.R. No. 73569 it appeared that on January 11, 1985, MISSION filed a motion
to dismiss the Interpleader and the claims of the Maysilo Estate and the
Intervenors and to order the Eternal Gardens to comply with its Land Management
with MISSION.
On January 28, 1985, the trial court passed a resolution, the dispositive portion of
which reads:
WHEREFORE, premises considered, this Court, after a lengthy,
careful judicious study and perusal of all the stand of each and
everyone of all the parties participating in this case, hereby orders
the dismissal of the interpleader, and the interventions filed by the
intervenors, heirs of Pedro Banon, heirs of O'Farrel, heirs of
Rivera, heirs of Maria del Concepcion Vidal, consolidated with the
Maysilo Estate as represented by receiver Arturo Salientes the
heirs of Vicente Singson Encarnacion, and Lilia Sevilla Seeling
This Court likewise orders the plaintiff, Eternal Gardens Memorial
Parks Corporation to comply with the Land Development
Agreement dated October 6, 1978, it entered into with the North
Philippine Union Mission Corporation of the Seventh-Day
Adventists. (Rollo. p. 68)
The heirs of the Maysilo Estate moved for reconsideration of the aforementioned
order of dismissal, the hearing of which was requested to be set on February, 28,
1985. However, the trial judge, on February 14, 1985 issued the following orders:
Considering Motions for Reconsideration filed, the Court resolves
that the same be GRANTED and instead of a hearing of the said
motions on February 20, 1985, at 8:30 a.m., a hearing on the
merits shall be held. (Rollo, p. 68)
In spite of the February 14, 1985 order, MISSION filed on March 6, 1985 a motion
for Writ of Execution of the resolution of January 28, 1985. This was denied on
June 25, 1985. The said court further set the case for pre-trial and trial on July 18,
1985.
It was elevated on certiorari and mandamus to the Intermediate Appellate Court
(Court of Appeals), docketed as AC-G.R. Sp No. 06696 "North Philippine Union
Mission of the Seventh Day Adventists, vs. Hon. Antonia Corpus-Macandog
Presiding Judge, Branch CXX, Regional Trial Court, Caloocan City, Eternal
Gardens Memorial Parks Corporation, and Heirs of Vicente Singson Encarnacion It
was raffled to the Second Special Division. MISSION assailed the February 14,
1985 and June 25, 1985 orders as violative of due process and attended by grave
abuse of discretion amounting to lack of jurisdiction. The petition was however
dismissed in the decision of said Appellate Court, promulgated on December 4,
1985, the dispositive portion of which reads:
WHEREFORE, for want of merit the petition for certiorari and
mandamus under consideration cannot be given due course and
is accordingly, DISMISSED, without any pronouncement, as to
costs. The restraining order embodied in Our Resolution of July
31, 1985, is hereby lifted. (Rollo, G.R. No. 73569 p. 232)
The private respondent challenged the above decision in the Supreme Court in
G.R. No. 73569. In its resolution dated June 11, 1986, the Supreme Court denied
the petition for review on certiorari for lack of merit, as follows:
G.R. No. 73569 (North Philippine Union Mission Corporation of the
Seventh Day Adventists vs. Intermediate Appellate Court, et al.)
considering the allegations, issues, and arguments adduced in the
petition for review on certiorari, the Court Resolved to DENY the
same for lack of merit. (Ibid p. 263)
Said resolution has become final and executory on July 16, 1986. (Ibid p. 269)
Earlier in 1983, the heirs of the late spouses Vicente Singson Encarnacion and
Lucila Conde filed Civil Case No. C-11836 for quieting of title with Branch CXXII,
Regional Trial Court, Caloocan City, where petitioner and private respondent were
named as defendants.
Said case is still pending in the lower Court.
In the case at bar, G.R. No. 73794, MISSION, herein private respondent filed a
petition for certiorari with the then Intermediate Appellate Court docketed as AC-
G.R. No. 04869 praying that the aforementioned Orders of February 13, 1984 and
October 26, 1984 of the Regional Trial Court be set aside and that an order be
issued to deposit in court or in a depositor trustee bank of any and all payments,
plus interest thereon, due the private respondent MISSION under the Land
Page 7 of 507
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Development Agreement, said amounts deposited to be paid to whomever may be
found later to be entitled thereto, with costs. (Rollo, G.R. No. 73794 p. 38)
The Intermediate Appelate Court, acting through its First Special Cases
Division 4 dismissed the petition in its decision on February 27, 1985 (Rollo, pp.
38-48). In its Resolution 5 promulgated on September 5, 1985, the Court however,
reversed its decision, thus:
WHEREFORE, the Court reconsiders its decision of February 27,
1986, and sets aside the questioned portions of the respondent
Court's orders of February 13 and October 26, 1984. The private
respondent is hereby ordered to deposit whatever amounts are
due from it under the Land Development Agreement of October 6,
1976 with a reputable bank to be designated by the respondent
court to be the depository trustee of the said amounts to be paid to
whoever shall be found entitled thereto. No costs. (Rollo, p. 25)
Eternal Gardens moved for a reconsideration of the above decision but it was
denied for lack of merit in a resolution promulgated on February 13, 1986, which
states:
The private respondent Eternal Gardens Memorial Park
Corporation's Motion for Reconsideration of the Court's resolution
promulgated September 5, 1985 requiring it "to deposit whatever
amounts are due from it under the Land Development Agreement
of October 6, 1976 ...," which was strongly opposed by the
petitioner North Philippine Union Mission of the Seventh Day
Adventists, is hereby denied for lack of merit, reiterating as it does,
the very same issues and arguments that were passed upon and
considered by the Court in the very same resolution sought to be
reconsidered. (Rollo, p. 27)
Hence, this petition. On July 8,1987, the Third Division of this Court issued the
following resolution:
... the court RESOLVED to give due course to this petition and
require the parties to file memoranda.
In the meantime, to avoid possible wastage of funds, the Court
RESOLVED to require the private respondent 6 to DEPOSIT its
accruing installments within ten (10) days from notice with a
reputable commercial bank in a savings deposit account, in the
name of the Supreme Court of the Philippines, with the details to
be reported or manifested to this Court within ten (10) days from
the time the deposit/deposits are made, such deposits not to be
withdrawn without authority from this Court. (Rollo, p. 162)
Petitioner's Memorandum With Prayer for the Deferment of Time to Make Deposit
(Rollo, p. 218-236) was filed on July 14, 1987. Its prayer was granted for a period
of ten (10) days for the purpose, in the resolution of July 29, 1987 (Rollo, p. 238).
Private respondent filed its Opposition to Deferment of Time to Make Deposit
(Rollo, pp. 239-253) on July 24, 1987 to which petitioner filed its Reply to
Opposition on August 4, 1987 (Rollo, pp. 256-267). Both were noted by the Court
in its resolution dated September 7, 1987 (Rollo, p. 270). On August 25, 1987,
private respondent filed its Rejoinder to Petitioner's Reply to Opposition (Rollo, pp.
271-292).
Petitioner filed its Supplemental Memorandum with Reply to Opposition (To
Deferment of time to Make Deposit) on August 31, 1987 (Rollo, pp. 294-313) and a
Sur-rejoinder on September 1, 1987 (Rollo, pp. 304-315).
The main issues in this case are:
I
Whether or not respondent Court of Appeals abused its discretion
amounting to lack of jurisdiction in reconsidering its resolution of
February 27, 1985 and in requiring instead in the resolution of
September 5, 1985, that petitioner Eternal Gardens deposit
whatever amounts are due from it under the Land Development
Agreement with a reputable bank to be designated by the
respondent court.
II
Whether or not the dismissal of AC-G.R. SP No. 06696 (North
Philippine Union Mission of the Seventh Day Adventists vs. Hon.
Macandog, et al.) by the Second Special Cases Division of the
IAC which was affirmed by the Supreme Court in G.R. No. 73569
Page 8 of 507
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 constitutes a basis for the dismissal of the case at bar on the
ground of res adjudicata.
I a rule founded on justice and equity: "that the plaintiff may not continue to benefit
There is no question that courts have inherent power to amend their judgments, to
make them conformable to the law applicable provided that said judgments have
not yet attained finality (Villanueva v. Court of First Instance of Oriental Mindoro,
Pinamalayan Branch II, 119 SCRA 288 [1982]). In fact, motions for reconsideration
are allowed to convince the courts that their rulings are erroneous and improper
Siy v. Court of Appeals, 138 SCRA 543-544 [1985]; Guerra Enterprises Co., Inc. v.
CFI of Lanao del Sur (32 SCRA 317 [1970]) and in so doing, said courts are given
sufficient opportunity to correct their errors.
In the case at bar, a careful analysis of the records will show that petitioner
admitted among others in its complaint in Interpleader that it is still obligated to pay
certain amounts to private respondent; that it claims no interest in such amounts
due and is willing to pay whoever is declared entitled to said amounts. Such
admissions in the complaint were reaffirmed in open court before the Court of
Appeals as stated in the latter court's resolution dated September 5, 1985 in A.C.
G.R. No. 04869 which states:
The private respondent (MEMORIAL) then reaffirms before the
Court its original position that it is a disinterested party with
respect to the property now the subject of the interpleader case ...
In the light of the willingness, expressly made before the court,
affirming the complaint filed below, that the private respondent
(MEMORIAL) will pay whatever is due on the Land Development
Agreement to the rightful owner/owners, there is no reason why
the amount due on subject agreement has not been placed in the
custody of the Court. (Rollo, p. 227).
Under the circumstances, there appears to be no plausible reason for petitioner's
objections to the deposit of the amounts in litigation after having asked for the
assistance of the lower court by filing a complaint for interpleader where the
deposit of aforesaid amounts is not only required by the nature of the action but is
a contractual obligation of the petitioner under the Land Development Program
(Rollo, p. 252).
As correctly observed by the Court of Appeals, the essence of an interpleader,
aside from the disavowal of interest in the property in litigation on the part of the
petitioner, is the deposit of the property or funds in controversy with the court. it is
from the property or funds in litigation during the pendency of the suit at the
expense of whoever will ultimately be decided as entitled thereto." (Rollo, p. 24).
The case at bar was elevated to the Court of Appeals on certiorari with prohibitory
and mandatory injunction. Said appellate court found that more than twenty million
pesos are involved; so that on interest alone for savings or time deposit would be
considerable, now accruing in favor of the Eternal Gardens. Finding that such is
violative of the very essence of the complaint for interpleader as it clearly runs
against the interest of justice in this case, the Court of Appeals cannot be faulted
for finding that the lower court committed a grave abuse of discretion which
requires correction by the requirement that a deposit of said amounts should be
made to a bank approved by the Court. (Rollo, p.-25)
Petitioner would now compound the issue by its obvious turn-about, presently
claiming in its memorandum that there is a novation of contract so that the
amounts due under the Land Development Agreement were allegedly
extinguished, and the requirement to make a deposit of said amounts in a
depositary bank should be held in abeyance until after the conflicting claims of
ownership now on trial before Branch CXXII RTC-Caloocan City, has finally been
resolved.
All these notwithstanding, the need for the deposit in question has been
established, riot only in the lower courts and in the Court of Appeals but also in the
Supreme Court where such deposit was required in "the resolution of July 8, 1987
to avoid wastage of funds.
II
The claim that this case should be barred by res judicata is even more untenable.
The requisite of res judicata are: (1) the presence of a final former judgment; (2)
the former judgment was rendered by a court having jurisdiction over the subject
matter and the parties; (3) the former judgment is a judgment on the merits; and
(4) there is between the first and the second action identity of parties, of subject
matter, and of causes of action Arguson v. Miclat 135 SCRA 678
[1985]; Carandang v. Venturanza, 133 SCRA 344 [1984]).
Page 9 of 507
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There is no argument against the rule that parties should not be permitted to DECISION
litigate the same issue more than once and when a right or fact has been judicially
tried and determined by a court of competent jurisdiction, so long as it remains NACHURA, J.:
unreversed, it should be conclusive upon the parties and those in privity with them
in law or estate (Sy Kao v. Court of Appeals, 132 SCRA 302 [1984]). This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court
seeking the reversal of the Decision1 of the Court of Appeals (CA) dated May 26,
But a careful review of the records shows that there is no judgment on the merits in 1998 and its Resolution2dated December 10, 1998 in CA-G.R. SP No. 37739
G.R. No. 73569 and in the case at bar, G.R. No. 73794; both of which deal on dismissing the petition filed by petitioners Josephine and Subhash Pasricha.
mere incidents arising therefrom.
The facts of the case, as culled from the records, are as follows:
In G.R. No 73569, the issue raised is the propriety of the grant of the motion for
reconsideration without a hearing thereon and the denial of the motion for Respondent Don Luis Dison Realty, Inc. and petitioners executed two Contracts of
execution, while in the case at bar, what is assailed is the propriety of the order of Lease3 whereby the former, as lessor, agreed to lease to the latter Units 22, 24,
respondent appellant court that petitioner Eternal Gardens should deposit 32, 33, 34, 35, 36, 37 and 38 of the San Luis Building, located at 1006 M.Y. Orosa
whatever amounts are due from it under the Land Development Agreement with a cor. T.M. Kalaw Streets, Ermita, Manila. Petitioners, in turn, agreed to pay monthly
reputable bank to be designated by the Court. In fact, there is a pending trial on rentals, as follows:
the merits in the trial court which the petitioner insists is a prejudicial question
which should first be resolved. Moreover, while there may be Identity of parties and For Rooms 32/35:
of subject matter, the Land Development Contract, there is no Identity of issues as
clearly shown by the petitions filed.
From March 1, 1991 to August 31, 1991 - P5,000.00/P10,000.00
PREMISES CONSIDERED, (a) the petition is DISMISSED for lack of merit; (b) this
case (together with all the claims of the intervenors on the merits) is REMANDED
From September 1, 1991 to February 29, 1992 - P5,500.00/P11,000.00
to the lower court for further proceedings; and (c) the resolution of the Third
Division of this Court of July 8, 1987 requiring the deposit by the petitioner (see
footnote No. 6) of the amounts contested in a depositary bank STANDS (the From March 1, 1992 to February 28, 1993 - P6,050.00/P12,100.00
Motion for Reconsideration thereof being hereby DENIED for reasons already
discussed) until after the decision on the merits shall have become final and
executory. From March 1, 1993 to February 28, 1994 - P6,655.00/P13,310.00

SO ORDERED. From March 1, 1994 to February 28, 1995 - P7,320.50/P14,641.00

From March 1, 1995 to February 28, 1996 - P8,052.55/P16,105.10

[G.R. NO. 136409 : March 14, 2008] From March 1, 1996 to February 29, 1997 - P8,857.81/P17,715.61

SUBHASH C. PASRICHA and JOSEPHINE A. PASRICHA, Petitioners, v. DON

LUIS DISON REALTY, INC., Respondent. From March 1, 1997 to February 28, 1998 - P9,743.59/P19,487.17

Page 10 of 507
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From March 1, 1998 to February 28, 1999 - P10,717.95/P21,435.89
From March 1, 1999 to February 28, 2000 - P11,789.75/P23,579.484
For Rooms 22 and 24:
Effective July 1, 1992 - P10,000.00 with an increment of 10% every two years.5
For Rooms 33 and 34:
Effective April 1, 1992 - P5,000.00 with an increment of 10% every two years.6
For Rooms 36, 37 and 38:
Effective when tenants vacate said premises - P10,000.00 with an increment of
10% every two years.7
Petitioners were, likewise, required to pay for the cost of electric consumption,
water bills and the use of telephone cables.8
The lease of Rooms 36, 37 and 38 did not materialize leaving only Rooms 22, 24,
32, 33, 34 and 35 as subjects of the lease contracts.9 While the contracts were in
effect, petitioners dealt with Francis Pacheco (Pacheco), then General Manager of
private respondent. Thereafter, Pacheco was replaced by Roswinda Bautista (Ms.
Bautista).10 Petitioners religiously paid the monthly rentals until May 1992.11 After
that, however, despite repeated demands, petitioners continuously refused to pay
the stipulated rent. Consequently, respondent was constrained to refer the matter
to its lawyer who, in turn, made a final demand on petitioners for the payment of
the accrued rentals amounting to P916,585.58.12 Because petitioners still refused
to comply, a complaint for ejectment was filed by private respondent through its
representative, Ms. Bautista, before the Metropolitan Trial Court (MeTC) of
Manila.13 The case was raffled to Branch XIX and was docketed as Civil Case No.
143058-CV.
Petitioners admitted their failure to pay the stipulated rent for the leased premises
starting July until November 1992, but claimed that such refusal was justified
because of the internal squabble in respondent company as to the person
authorized to receive payment.14 To further justify their non-payment of rent,
petitioners alleged that they were prevented from using the units (rooms) subject
matter of the lease contract, except Room 35. Petitioners eventually paid their
monthly rent for December 1992 in the amount of P30,000.00, and claimed that
respondent waived its right to collect the rents for the months of July to November
1992 since petitioners were prevented from using Rooms 22, 24, 32, 33, and
34.15However, they again withheld payment of rents starting January 1993
because of respondent's refusal to turn over Rooms 36, 37 and 38. 16 To show
good faith and willingness to pay the rents, petitioners alleged that they prepared
the check vouchers for their monthly rentals from January 1993 to January
1994.17 Petitioners further averred in their Amended Answer18 that the complaint
for ejectment was prematurely filed, as the controversy was not referred to the
barangay for conciliation.
For failure of the parties to reach an amicable settlement, the pre-trial conference
was terminated. Thereafter, they submitted their respective position papers.
On November 24, 1994, the MeTC rendered a Decision dismissing the complaint
for ejectment.19 It considered petitioners' non-payment of rentals as unjustified.
The court held that mere willingness to pay the rent did not amount to payment of
the obligation; petitioners should have deposited their payment in the name of
respondent company. On the matter of possession of the subject premises, the
court did not give credence to petitioners' claim that private respondent failed to
turn over possession of the premises. The court, however, dismissed the complaint
because of Ms. Bautista's alleged lack of authority to sue on behalf of the
corporation.
Deciding the case on appeal, the Regional Trial Court (RTC) of Manila, Branch 1,
in Civil Case No. 94-72515, reversed and set aside the MeTC Decision in this
wise:
WHEREFORE, the appealed decision is hereby reversed and set aside and
another one is rendered ordering defendants-appellees and all persons claiming
rights under them, as follows:
(1) to vacate the leased premised (sic) and restore possession thereof to plaintiff-
appellant;
Page 11 of 507
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(2) to pay plaintiff-appellant the sum of P967,915.80 representing the accrued
rents in arrears as of November 1993, and the rents on the leased premises for the
succeeding months in the amounts stated in paragraph 5 of the complaint until fully
paid; andcralawlibrary
(3) to pay an additional sum equivalent to 25% of the rent accounts as and for
attorney's fees plus the costs of this suit.
SO ORDERED.20
The court adopted the MeTC's finding on petitioners' unjustified refusal to pay the
rent, which is a valid ground for ejectment. It, however, faulted the MeTC in
dismissing the case on the ground of lack of capacity to sue. Instead, it upheld Ms.
Bautista's authority to represent respondent notwithstanding the absence of a
board resolution to that effect, since her authority was implied from her power as a
general manager/treasurer of the company.21
and directed the RTC to issue a new writ of execution of its decision, with the
exception of the award of attorney's fees which the CA deleted.31
Petitioners now come before this Court in this Petition for Review
on Certiorari raising the following issues:
I.
Whether this ejectment suit should be dismissed and whether petitioners are
entitled to damages for the unauthorized and malicious filing by Rosario (sic)
Bautista of this ejectment case, it being clear that [Roswinda] - whether as general
manager or by virtue of her subsequent designation by the Board of Directors as
the corporation's attorney-in-fact - had no legal capacity to institute the ejectment
suit, independently of whether Director Pacana's Order setting aside the SEC
revocation Order is a mere scrap of paper.

Aggrieved, petitioners elevated the matter to the Court of Appeals in a Petition for
Review on Certiorari .22 On March 18, 1998, petitioners filed an Omnibus II.
Motion23 to cite Ms. Bautista for contempt; to strike down the MeTC and RTC
Decisions as legal nullities; and to conduct hearings and ocular inspections or
delegate the reception of evidence. Without resolving the aforesaid motion, on May Whether the RTC's and the Honorable Court of Appeals' failure and refusal to
26, 1998, the CA affirmed24 the RTC Decision but deleted the award of attorney's resolve the most fundamental factual issues in the instant ejectment case render
fees.25
said decisions void on their face by reason of the complete abdication by the RTC
Petitioners moved for the reconsideration of the aforesaid decision.26
Thereafter, and the Honorable Justice Ruben Reyes of their constitutional duty not only to
they filed several motions asking the Honorable Justice Ruben T. Reyes to inhibit
from further proceeding with the case allegedly because of his close association clearly and distinctly state the facts and the law on which a decision is based but
with Ms. Bautista's uncle-in-law.27
also to resolve the decisive factual issues in any given case.
In aResolution28 dated December 10, 1998, the CA denied the motions for lack of
merit. The appellate court considered said motions as repetitive of their previous III.
arguments, irrelevant and obviously dilatory.29 As to the motion for inhibition of the
Honorable Justice Reyes, the same was denied, as the appellate court justice
stressed that the decision and the resolution were not affected by extraneous Whether the (1) failure and refusal of Honorable Justice Ruben Reyes to inhibit
matters.30 Lastly, the appellate court granted respondent's motion for execution
himself, despite his admission - by reason of his silence - of petitioners' accusation

Page 12 of 507
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that the said Justice enjoyed a $7,000.00 scholarship grant courtesy of the uncle-
in-law of respondent "corporation's" purported general manager and (2), worse, his
act of ruling against the petitioners and in favor of the respondent "corporation"
constitute an unconstitutional deprivation of petitioners' property without due
process of law.32
In addition to Ms. Bautista's lack of capacity to sue, petitioners insist that
respondent company has no standing to sue as a juridical person in view of the
suspension and eventual revocation of its certificate of registration. 33 They likewise
question the factual findings of the court on the bases of their ejectment from the
subject premises. Specifically, they fault the appellate court for not finding that: 1)
their non-payment of rentals was justified; 2) they were deprived of possession of
all the units subject of the lease contract except Room 35; and 3) respondent
violated the terms of the contract by its continued refusal to turn over possession
of Rooms 36, 37 and 38. Petitioners further prayed that a Temporary Restraining
Order (TRO) be issued enjoining the CA from enforcing its Resolution directing the
issuance of a Writ of Execution. Thus, in a Resolution34 dated January 18, 1999,
this Court directed the parties to maintain the status quo effective immediately until
further orders.
The petition lacks merit.
We uphold the capacity of respondent company to institute the ejectment case.
Although the Securities and Exchange Commission (SEC) suspended and
eventually revoked respondent's certificate of registration on February 16, 1995,
records show that it instituted the action for ejectment on December 15, 1993.
Accordingly, when the case was commenced, its registration was not yet
revoked.35 Besides, as correctly held by the appellate court, the SEC later set
aside its earlier orders of suspension and revocation of respondent's certificate,
rendering the issue moot and academic.36
We likewise affirm Ms. Bautista's capacity to sue on behalf of the company despite
lack of proof of authority to so represent it. A corporation has no powers except
those expressly conferred on it by the Corporation Code and those that are implied
from or are incidental to its existence. In turn, a corporation exercises said powers
through its board of directors and/or its duly authorized officers and agents.
Physical acts, like the signing of documents, can be performed only by natural
persons duly authorized for the purpose by corporate by-laws or by a specific act
of the board of directors.37 Thus, any person suing on behalf of the corporation
should present proof of such authority. Although Ms. Bautista initially failed to show
that she had the capacity to sign the verification and institute the ejectment case
on behalf of the company, when confronted with such question, she immediately
presented the Secretary's Certificate38 confirming her authority to represent the
company.
There is ample jurisprudence holding that subsequent and substantial compliance
may call for the relaxation of the rules of procedure in the interest of justice. 39 In
Novelty Phils., Inc. v. Court of Appeals,40 the Court faulted the appellate court for
dismissing a petition solely on petitioner's failure to timely submit proof of authority
to sue on behalf of the corporation. In Pfizer, Inc. v. Galan,41 we upheld the
sufficiency of a petition verified by an employment specialist despite the total
absence of a board resolution authorizing her to act for and on behalf of the
corporation. Lastly, in China Banking Corporation v. Mondragon International
Philippines, Inc,42 we relaxed the rules of procedure because the corporation
ratified the manager's status as an authorized signatory. In all of the above cases,
we brushed aside technicalities in the interest of justice. This is not to say that we
disregard the requirement of prior authority to act in the name of a corporation. The
relaxation of the rules applies only to highly meritorious cases, and when there is
substantial compliance. While it is true that rules of procedure are intended to
promote rather than frustrate the ends of justice, and while the swift unclogging of
court dockets is a laudable objective, we should not insist on strict adherence to
the rules at the expense of substantial justice.43 Technical and procedural rules are
intended to help secure, not suppress, the cause of justice; and a deviation from
the rigid enforcement of the rules may be allowed to attain that prime objective, for,
after all, the dispensation of justice is the core reason for the existence of courts. 44
As to the denial of the motion to inhibit Justice Reyes, we find the same to be in
order. First, the motion to inhibit came after the appellate court rendered the
assailed decision, that is, after Justice Reyes had already rendered his opinion on
the merits of the case. It is settled that a motion to inhibit shall be denied if filed
after a member of the court had already given an opinion on the merits of the case,
the rationale being that "a litigant cannot be permitted to speculate on the action of
the court x x x (only to) raise an objection of this sort after the decision has been
rendered."45 Second, it is settled that mere suspicion that a judge is partial to one
of the parties is not enough; there should be evidence to substantiate the
suspicion. Bias and prejudice cannot be presumed, especially when weighed
against a judge's sacred pledge under his oath of office to administer justice
without regard for any person and to do right equally to the poor and the rich.
There must be a showing of bias and prejudice stemming from an extrajudicial
Page 13 of 507
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source, resulting in an opinion on the merits based on something other than what
the judge learned from his participation in the case.46 We would like to reiterate, at
this point, the policy of the Court not to tolerate acts of litigants who, for just about
any conceivable reason, seek to disqualify a judge (or justice) for their own
purpose, under a plea of bias, hostility, prejudice or prejudgment. 47
We now come to the more substantive issue of whether or not the petitioners may
be validly ejected from the leased premises.
Unlawful detainer cases are summary in nature. In such cases, the elements to be
proved and resolved are the fact of lease and the expiration or violation of its
terms.48 Specifically, the essential requisites of unlawful detainer are: 1) the fact of
lease by virtue of a contract, express or implied; 2) the expiration or termination of
the possessor's right to hold possession; 3) withholding by the lessee of
possession of the land or building after the expiration or termination of the right to
possess; 4) letter of demand upon lessee to pay the rental or comply with the
terms of the lease and vacate the premises; and 5) the filing of the action within
one year from the date of the last demand received by the defendant.49
It is undisputed that petitioners and respondent entered into two separate contracts
of lease involving nine (9) rooms of the San Luis Building. Records, likewise, show
that respondent repeatedly demanded that petitioners vacate the premises, but the
latter refused to heed the demand; thus, they remained in possession of the
premises. The only contentious issue is whether there was indeed a violation of
the terms of the contract: on the part of petitioners, whether they failed to pay the
stipulated rent without justifiable cause; while on the part of respondent, whether it
prevented petitioners from occupying the leased premises except Room 35.
This issue involves questions of fact, the resolution of which requires the
evaluation of the evidence presented. The MeTC, the RTC and the CA all found
that petitioners failed to perform their obligation to pay the stipulated rent. It is
settled doctrine that in a civil case, the conclusions of fact of the trial court,
especially when affirmed by the Court of Appeals, are final and conclusive, and
cannot be reviewed on appeal by the Supreme Court.50 Albeit the rule admits of
exceptions, not one of them obtains in this case.51
To settle this issue once and for all, we deem it proper to assess the array of
factual findings supporting the court's conclusion.
The evidence of petitioners' non-payment of the stipulated rent is overwhelming.
Petitioners, however, claim that such non-payment is justified by the following: 1)
the refusal of respondent to allow petitioners to use the leased properties, except
room 35; 2) respondent's refusal to turn over Rooms 36, 37 and 38; and 3)
respondent's refusal to accept payment tendered by petitioners.
Petitioners' justifications are belied by the evidence on record. As correctly held by
the CA, petitioners' communications to respondent prior to the filing of the
complaint never mentioned their alleged inability to use the rooms. 52 What they
pointed out in their letters is that they did not know to whom payment should be
made, whether to Ms. Bautista or to Pacheco.53 In their July 26 and October 30,
1993 letters, petitioners only questioned the method of computing their electric
billings without, however, raising a complaint about their failure to use the
rooms.54 Although petitioners stated in their December 30, 1993 letter that
respondent failed to fulfill its part of the contract,55 nowhere did they specifically
refer to their inability to use the leased rooms. Besides, at that time, they were
already in default on their rentals for more than a year.
If it were true that they were allowed to use only one of the nine (9) rooms subject
of the contract of lease, and considering that the rooms were intended for a
business purpose, we cannot understand why they did not specifically assert their
right. If we believe petitioners' contention that they had been prevented from using
the rooms for more than a year before the complaint for ejectment was filed, they
should have demanded specific performance from the lessor and commenced an
action in court. With the execution of the contract, petitioners were already in a
position to exercise their right to the use and enjoyment of the property according
to the terms of the lease contract.56 As borne out by the records, the fact is that
respondent turned over to petitioners the keys to the leased premises and
petitioners, in fact, renovated the rooms. Thus, they were placed in possession of
the premises and they had the right to the use and enjoyment of the same. They,
likewise, had the right to resist any act of intrusion into their peaceful possession of
the property, even as against the lessor itself. Yet, they did not lift a finger to
protect their right if, indeed, there was a violation of the contract by the lessor.
What was, instead, clearly established by the evidence was petitioners' non-
payment of rentals because ostensibly they did not know to whom payment should
be made. However, this did not justify their failure to pay, because if such were the
case, they were not without any remedy. They should have availed of the
provisions of the Civil Code of the Philippines on the consignation of payment and
of the Rules of Court on interpleader.
Article 1256 of the Civil Code provides:
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Article 1256. If the creditor to whom tender of payment has been made refuses
without just cause to accept it, the debtor shall be released from responsibility by
the consignation of the thing or sum due.
Consignation alone shall produce the same effect in the following cases:
xxx
(4) When two or more persons claim the same right to collect;
x x x x.
Consignation shall be made by depositing the things due at the disposal of a
judicial authority, before whom the tender of payment shall be proved in a proper
case, and the announcement of the consignation in other cases.57
In the instant case, consignation alone would have produced the effect of payment
of the rentals. The rationale for consignation is to avoid the performance of an
obligation becoming more onerous to the debtor by reason of causes not
imputable to him.58 Petitioners claim that they made a written tender of payment
and actually prepared vouchers for their monthly rentals. But that was insufficient
to constitute a valid tender of payment. Even assuming that it was valid tender,
still, it would not constitute payment for want of consignation of the amount. Well-
settled is the rule that tender of payment must be accompanied by consignation in
order that the effects of payment may be produced.59
Moreover, Section 1, Rule 62 of the Rules of Court provides:
Section 1. When interpleader proper. - Whenever conflicting claims upon the same
subject matter are or may be made against a person who claims no interest
whatever in the subject matter, or an interest which in whole or in part is not
disputed by the claimants, he may bring an action against the conflicting claimants
to compel them to interplead and litigate their several claims among themselves.
Otherwise stated, an action for interpleader is proper when the lessee does not
know to whom payment of rentals should be made due to conflicting claims on the
property (or on the right to collect).60 The remedy is afforded not to protect a
person against double liability but to protect him against double vexation in respect
of one liability.61
Notably, instead of availing of the above remedies, petitioners opted to refrain from
making payments.
Neither can petitioners validly invoke the non-delivery of Rooms 36, 37 and 38 as
a justification for non-payment of rentals. Although the two contracts embraced the
lease of nine (9) rooms, the terms of the contracts - with their particular reference
to specific rooms and the monthly rental for each - easily raise the inference that
the parties intended the lease of each room separate from that of the
others.ςηαñrοblεš νιr†υαl lαω lιbrαrÿ
There is nothing in the contract which would lead to the conclusion that the lease
of one or more rooms was to be made dependent upon the lease of all the nine (9)
rooms. Accordingly, the use of each room by the lessee gave rise to the
corresponding obligation to pay the monthly rental for the same. Notably,
respondent demanded payment of rentals only for the rooms actually delivered to,
and used by, petitioners.
It may also be mentioned that the contract specifically provides that the lease of
Rooms 36, 37 and 38 was to take effect only when the tenants thereof would
vacate the premises. Absent a clear showing that the previous tenants had
vacated the premises, respondent had no obligation to deliver possession of the
subject rooms to petitioners. Thus, petitioners cannot use the non-delivery of
Rooms 36, 37 and 38 as an excuse for their failure to pay the rentals due on the
other rooms they occupied.ςηαñrοblεš νιr†υαl lαω lιbrαrÿ
In light of the foregoing disquisition, respondent has every right to exercise his right
to eject the erring lessees. The parties' contracts of lease contain identical
provisions, to wit:
In case of default by the LESSEE in the payment of rental on the fifth (5th) day of
each month, the amount owing shall as penalty bear interest at the rate of FOUR
percent (4%) per month, to be paid, without prejudice to the right of the LESSOR
to terminate his contract, enter the premises, and/or eject the LESSEE as
hereinafter set forth;62
Moreover, Article 167363 of the Civil Code gives the lessor the right to judicially
eject the lessees in case of non-payment of the monthly rentals. A contract of
lease is a consensual, bilateral, onerous and commutative contract by which the
owner temporarily grants the use of his property to another, who undertakes to pay
the rent therefor.64 For failure to pay the rent, petitioners have no right to remain in
the leased premises.
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WHEREFORE, premises considered, the petition is DENIED and the Status Quo THE ANTECEDENTS
Order dated January 18, 1999 is hereby LIFTED. The Decision of the Court of
Appeals dated May 26, 1998 and its Resolution dated December 10, 1998 in CA- The Central Bank bills
G.R. SP No. 37739 are AFFIRMED.
I. First set of CB bills
SO ORDERED.
The Rizal Commercial Banking Corporation (RCBC) was the registered owner of
seven Central Bank (CB) bills with a total face value of ₱ 70 million, issued on
January 2, 1994 and would mature on January 2, 1995.2 As evidenced by a
"Detached Assignment" dated April 8, 1994,3 the RCBC sold these CB bills to the
G.R. Nos. 154470-71 September 24, 2012 BOC.4 As evidenced by another "Detached Assignment"5 of even date, the BOC, in
turn, sold these CB bills to the PDB.6 The BOC delivered the Detached
BANK OF COMMERCE, Petitioner, Assignments to the PDB.7
vs.
PLANTERS DEVELOPMENT BANK and BANGKO SENTRAL NG On April 15, 1994 (April 15 transaction), the PDB, in turn, sold to the BOC
PILIPINAS, Respondent. Treasury Bills worth ₱ 70 million, with maturity date of June 29, 1994, as
evidenced by a Trading Order8 and a Confirmation of Sale.9 However, instead of
x-----------------------x delivering the Treasury Bills, the PDB delivered the seven CB bills to the BOC, as
evidenced by a PDB Security Delivery Receipt, bearing a "note: ** substitution in
G.R. Nos. 154589-90 lieu of 06-29-94" – referring to the Treasury Bills.10 Nevertheless, the PDB retained
possession of the Detached Assignments. It is basically the nature of this April 15
transaction that the PDB and the BOC cannot agree on.
BANGKO SENTRAL NG PILIPINAS, Petitioner,
vs.
PLANTERS DEVELOPMENT BANK, Respondent. The transfer of the first set of seven CB bills

DECISION i. CB bill nos. 45351-53

BRION, J.: On April 20, 1994, according to the BOC, it "sold back"11 to the PDB three of the
seven CB bills. In turn, the PDB transferred these three CB bills to Bancapital
Development Corporation (Bancap). On April 25, 1994, the BOC bought the three
Before the Court are two consolidated petitions for review on certiorari under Rule
CB bills from Bancap – so, ultimately, the BOC reacquired these three CB
45,1 on pure questions of law, filed by the petitioners Bank of Commerce (BOC)
bills,12 particularly described as follows:
and the Bangko Sentral ng Pilipinas (BSP). They assail the January 10, 2002 and
July 23, 2002 Orders (assailed orders) of the Regional Trial Court (RTC) of Makati
City, Branch 143, in Civil Case Nos. 94-3233 and 94-3254. These orders Serial No.: 2BB XM 045351
dismissed (i) the petition filed by the Planters Development Bank (PDB), (ii) the 2BB XM 045352
"counterclaim" filed by the BOC, and (iii) the counter-complaint/cross-claim for 2BB XM 045353
interpleader filed bythe BSP; and denied the BOC’s and the BSP’s motions for
reconsideration. Quantity: Three (3)

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 Denomination: Php 10 million Serial No.: BB XM 045373
BB XM 045374
Total Face Value: Php 30 million
Issue date: January 3, 1994
ii. CB bill nos. 45347-50 Maturity date: January 2, 1995

On April 20, 1994, the BOC sold the remaining four (4) CB bills to Capital One Denomination: Php 10 million
Equities Corporation13 which transferred them to All-Asia Capital and Trust
Total Face value: Php 20 million
Corporation (All Asia). On September 30, 1994, All Asia further transferred the four
CB bills back to the RCBC.14
On even date, the PDB delivered to Bancap the two CB bills 18 (April 19
On November 16, 1994, the RCBC sold back to All Asia one of these 4 CB bills. transaction). In turn, Bancap sold the CB bills to Al-Amanah Islamic Investment
When the BSP refused to release the amount of this CB bill on maturity, the BOC Bank of the Philippines, which in turn sold it to the BOC.19
purchased from All Asia this lone CB bill,15 particularly described as follows:16
PDB’s move against the transfer of
the first and second sets of CB bills
Serial No.: 2BB XM 045348

Quantity: One (1)
Denomination: Php 10 million
Total Face Value: Php 10 million
As the registered owner of the remaining three CB bills, the RCBC sold them to IVI
Capital and Insular Savings Bank. Again, when the BSP refused to release the
amount of this CB bill on maturity, the RCBC paid back its transferees, reacquired
these three CB bills and sold them to the BOC – ultimately, the BOC acquired
these three CB bills.
All in all, the BOC acquired the first set of seven CB bills.
II. Second set of CB bills
On April 19, 1994, the RCBC, as registered owner, (i) sold two CB bills with a total
face value of ₱ 20 million to the PDB and (ii) delivered to the PDB the
corresponding Detached Assignment.17 The two CB bills were particularly
described as follows:
On June 30, 1994, upon learning of the transfers involving the CB bills, the PDB
informed20 the Officer-in-Charge of the BSP’s Government Securities
Department,21 Lagrimas Nuqui, of the PDB’s claim over these CB bills, based on
the Detached Assignments in its possession. The PDB requested the BSP22 to
record its claim in the BSP’s books, explaining that its non-possession of the CB
bills is "on account of imperfect negotiations thereof and/or subsequent setoff or
transfer."23
Nuqui denied the request, invoking Section 8 of CB Circular No. 28 (Regulations
Governing Open Market Operations, Stabilization of the Securities Market, Issue,
Servicing and Redemption of the Public Debt)24 which requires the presentation of
the bond before a registered bond may be transferred on the books of the BSP.25
In a July 25, 1994 letter, the PDB clarified to Nuqui that it was not "asking for the
transfer of the CB Bills…. rather it intends to put the BSP on formal notice that
whoever is in possession of said bills is not a holder in due course," and, therefore
the BSP should not make payment upon the presentation of the CB bills on
maturity.26 Nuqui responded that the BSP was "not in a position at that point in time
to determine who is and who is not the holder in due course since it is not privy to
all acts and time involving the transfers or negotiation" of the CB bills. Nuqui added
that the BSP’s action shall be governed by CB Circular No. 28, as amended. 27

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On November 17, 1994, the PDB also asked BSP Deputy Governor Edgardo
Zialcita that (i) a notation in the BSP’s books be made against the transfer,
exchange, or payment of the bonds and the payment of interest thereon; and (ii)
the presenter of the bonds upon maturity be required to submit proof as a holder in
due course (of the first set of CB bills). The PDB relied on Section 10 (d) 4 of CB
Circular No. 28.28 This provision reads:
(4) Assignments effected by fraud – Where the assignment of a registered bond is
secured by fraudulent representations, the Central Bank can grant no relief if the
assignment has been honored without notice of fraud. Otherwise, the Central
Bank, upon receipt of notice that the assignment is claimed to have been secured
by fraudulent representations, or payment of the bond the payment of interest
thereon, and when the bond is presented, will call upon the owner and the person
presenting the bond to substantiate their respective claims.If it then appears that
the person presenting the bond stands in the position of bonafide holder for value,
the Central Bank, after giving the owner an opportunity to assert his claim, will
pass the bond for transfer, exchange or payments, as the case may be, without
further question.
In a December 29, 1994 letter, Nuqui again denied the request, reiterating the
BSP’s previous stand.
In light of these BSP responses and the impending maturity of the CB bills, the
PDB filed29 with the RTC two separate petitions for Mandamus, Prohibition and
Injunction with prayer for Preliminary Injunction and Temporary Restraining Order,
docketed as Civil Case No. 94-3233 (covering the first set of CB bills) and Civil
Case 94-3254 (covering the second set of CB bills) against Nuqui, the BSP and
the RCBC.30
The PDB essentially claims that in both the April 15 transaction (involving the first
set of CB bills) and the April 19 transaction (involving the second set of CB bills),
there was no intent on its part to transfer title of the CB bills, as shown by its non-
issuance of a detached assignment in favor of the BOC and Bancap, respectively.
The PDB particularly alleges that it merely "warehoused"31 the first set of CB bills
with the BOC, as security collateral.
On December 28, 1994, the RTC temporarily enjoined Nuqui and the BSP from
paying the face value of the CB bills on maturity.32 On January 10, 1995, the PDB
filed an Amended Petition, additionally impleading the BOC and All Asia. 33 In a
January 13, 1995 Order, the cases were consolidated.34 On January 17, 1995, the
RTC granted the PDB’s application for a writ of preliminary prohibitory
injunction.35 In both petitions, the PDB identically prayed:
WHEREFORE, it is respectfully prayed x x x that, after due notice and hearing, the
Writs of Mandamus, Prohibition and Injunction, be issued; (i) commanding the BSP
and Nuqui, or whoever may take her place -
(a) to record forthwith in the books of BSP the claim of x x x PDB on the [two sets
of] CB Bills in accordance with Section 10 (d) (4) of revised C.B. Circular No. 28;
and
(b) also pursuant thereto, when the bills are presented on maturity date for
payment, to call (i) x x x PDB, (ii) x x x RCBC x x x, (iii) x x x BOC x x x, and (iv) x
x x ALL-ASIA x x x; or whoever will present the [first and second sets of] CB Bills
for payment, to submit proof as to who stands as the holder in due course of said
bills, and, thereafter, act accordingly;
and (ii) ordering the BSP and Nuqui to pay jointly and severally to x x x PDB the
following:
(a) the sum of ₱ 100,000.00, as and for exemplary damages;
(b) the sum of at least ₱ 500,000.00, or such amount as shall be proved at
the trial, as and for attorney’s fees;
(c) the legal rate of interest from the filing of this Petition until full payment
of the sums mentioned in this Petition; and
(d) the costs of suit.36
After the petitions were filed, the BOC acquired/reacquired all the nine CB bills –
the first and second sets of CB bills (collectively, subject CB bills).
Defenses of the BSP and of the BOC37
The BOC filed its Answer, praying for the dismissal of the petition. It argued that
the PDB has no cause of action against it since the PDB is no longer the owner of
the CB bills. Contrary to the PDB’s "warehousing theory," 38 the BOC asserted that
the (i) April 15 transaction and the (ii) April 19 transaction – covering both sets of
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CB bills - were valid contracts of sale, followed by a transfer of title (i) to the BOC
(in the April 15 transaction) upon the PDB’s delivery of the 1st set of CB bills in
substitution of the Treasury Bills the PDB originally intended to sell, and (ii) to
Bancap (in the April 19 transaction) upon the PDB’s delivery of the 2nd set of CB
bills to Bancap, likewise by way of substitution.
The BOC adds that Section 10 (d) 4 of CB Circular No. 28 cannot apply to the
PDB’s case because (i) the PDB is not in possession of the CB bills and (ii) the
BOC acquired these bills from the PDB, as to the 1st set of CB bills, and from
Bancap, as to the 2nd set of CB bills, in good faith and for value. The BOC also
asserted a compulsory counterclaim for damages and attorney’s fees.
On the other hand, the BSP countered that the PDB cannot invoke Section 10 (d)
4 of CB Circular No. 28 because this section applies only to an "owner" and a
"person presenting the bond," of which the PDB is neither. The PDB has not
presented to the BSP any assignment of the subject CB bills, duly recorded in the
BSP’s books, in its favor to clothe it with the status of an "owner."39 According to
the BSP –
Section 10 d. (4) applies only to a registered bond which is assigned. And the
issuance of CB Bills x x x are required to be recorded/registered in BSP’s books. In
this regard, Section 4 a. (1) of CB Circular 28 provides that registered bonds "may
be transferred only by an assignment thereon duly executed by the registered
owner or his duly authorized representative x x x and duly recorded on the books
of the Central Bank."
xxxx
The alleged assignment of subject CB Bills in PDB’s favor is not
recorded/registered in BSP’s books.40(underscoring supplied)
Consequently, when Nuqui and the BSP refused the PDB’s request (to record its
claim), they were merely performing their duties in accordance with CB Circular
No. 28.
Alternatively, the BSP asked that an interpleader suit be allowed between and
among the claimants to the subject CB bills on the position that while it is able and
willing to pay the subject CB bills’ face value, it is duty bound to ensure that
payment is made to the rightful owner. The BSP prayed that judgment be
rendered:
a. Ordering the dismissal of the PDB’s petition for lack of merit;
b. Determining which between/among [PDB] and the other claimants is/are
lawfully entitled to the ownership of the subject CB bills and the proceeds
thereof;
c. x x x;
d. Ordering PDB to pay BSP and Nuqui such actual/compensatory and
exemplary damages… as the RTC may deem warranted; and
e. Ordering PDB to pay Nuqui moral damages… and to pay the costs of
the suit.41
Subsequent events
The PDB agreed with the BSP’s alternative response for an interpleader –
4. PDB agrees that the various claimants should now interplead and substantiate
their respective claims on the subject CB bills. However, the total face value of the
subject CB bills should be deposited in escrow with a private bank to be disposed
of only upon order of the RTC.42
Accordingly, on June 9, 199543 and August 4, 1995,44 the BOC and the PDB
entered into two separate Escrow Agreements.45 The first agreement covered the
first set of CB bills, while the second agreement covered the second set of CB
bills. The parties agreed to jointly collect from the BSP the maturity proceeds of
these CB bills and to deposit said amount in escrow, "pending final determination
by Court judgment, or amicable settlement as to who shall be eventually entitled
thereto."46 The BOC and the PDB filed a Joint Motion,47 submitting these Escrow
Agreements for court approval. The RTC gave its approval to the parties’ Joint
Motion.48 Accordingly, the BSP released the maturity proceeds of the CB bills by
crediting the Demand Deposit Account of the PDB and of the BOC with 50% each
of the maturity proceeds of the amount in escrow.49
In view of the BOC’s acquisition of all the CB bills, All Asia50 moved to be dropped
as a respondent (with the PDB’s conformity51 ), which the RTC granted.52 The
RCBC subsequently followed suit.53
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In light of the developments, on May 4, 1998, the RTC required the parties to
manifest their intention regarding the case and to inform the court of any amicable
settlement; "otherwise, th[e] case shall be dismissed for lack of
interest."54 Complying with the RTC’s order, the BOC moved (i) that the case be
set for pre-trial and (ii) for further proceeding to resolve the remaining issues
between the BOC and the PDB, particularly on "who has a better right over the
subject CB bills."55 The PDB joined the BOC in its motion.56
On September 28, 2000, the RTC granted the BSP’s motion to interplead and,
accordingly, required the BOC to amend its Answer and for the conflicting
claimants to comment thereon.57 In October 2000, the BOC filed its Amended
Consolidated Answer with Compulsory Counterclaim, reiterating its earlier
arguments asserting ownership over the subject CB bills.58
In the alternative, the BOC added that even assuming that there was no effective
transfer of the nine CB bills ultimately to the BOC, the PDB remains obligated to
deliver to the BOC, as buyer in the April 15 transaction and ultimate successor-in-
interest of the buyer (Bancap) in the April 19 transaction, either the original
subjects of the sales or the value thereof, plus whatever income that may have
been earned during the pendency of the case.59
That BOC prayed:
1. To declare BOC as the rightful owner of the nine (9) CB bills and as the
party entitled to the proceeds thereof as well as all income earned
pursuant to the two (2) Escrow Agreements entered into by BOC and
PDB.
2. In the alternative, ordering PDB to deliver the original subject of the
sales transactions or the value thereof and whatever income earned by
way of interest at prevailing rate.
Without any opposition or objection from the PDB, on February 23, 2001, the RTC
admitted60 the BOC’s Amended Consolidated Answer with Compulsory
Counterclaims.
In May 2001, the PDB filed an Omnibus Motion,61 questioning the RTC’s
jurisdiction over the BOC’s "additional counterclaims." The PDB argues that its
petitions pray for the BSP (not the RTC) to determine who among the conflicting
claimants to the CB bills stands in the position of the bona fide holder for value.
The RTC cannot entertain the BOC’s counterclaim, regardless of its nature,
because it is the BSP which has jurisdiction to determine who is entitled to receive
the proceeds of the CB bills.
The BOC opposed62 the PDB’s Omnibus Motion. The PDB filed its Reply.63
In a January 10, 2002 Order, the RTC dismissed the PDB’s petition, the BOC’s
counterclaim and the BSP’s counter-complaint/cross-claim for interpleader, holding
that under CB Circular No. 28, it has no jurisdiction (i) over the BOC’s
"counterclaims" and (ii) to resolve the issue of ownership of the CB bills.64 With the
denial of their separate motions for Reconsideration,65 the BOC and the BSP
separately filed the present petitions for review on certiorari.66
THE BOC’S and THE BSP’S PETITIONS
The BOC argues that the present cases do not fall within the limited provision of
Section 10 (d) 4 of CB Circular No. 28, which contemplates only of three situations:
first, where the fraudulent assignment is not coupled with a notice to the BSP, it
can grant no relief; second, where the fraudulent assignment is coupled with a
notice of fraud to the BSP, it will make a notation against the assignment and
require the owner and the holder to substantiate their claims; and third, where the
case does not fall on either of the first two situations, the BSP will have to await
action on the assignment pending settlement of the case, whether by agreement or
by court order.
The PDB’s case cannot fall under the first two situations. With particular regard to
the second situation, CB Circular No. 28 requires that the conflict must be between
an "owner" and a "holder," for the BSP to exercise its limited jurisdiction to resolve
conflicting claims; and the word "owner" here refers to the registered owner giving
notice of the fraud to the BSP. The PDB, however, is not the registered owner nor
is it in possession (holder) of the CB bills.67Consequently, the PDB’s case can only
falls under the third situation which leaves the RTC, as a court of general
jurisdiction, with the authority to resolve the issue of ownership of a registered
bond (the CB bills) not falling in either of the first two situations.
The BOC asserts that the policy consideration supportive of its interpretation of CB
Circular No. 28 is to have a reliable system to protect the registered owner; should
he file a notice with the BSP about a fraudulent assignment of certain CB bills, the
BSP simply has to look at its books to determine who is the owner of the CB bills
fraudulently assigned. Since it is only the registered owner who complied with the
Page 20 of 507
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BSP’s requirement of recording an assignment in the BSP’s books, then "the
protective mantle of administrative proceedings" should necessarily benefit him
only, without extending the same benefit to those who chose to ignore the
Circular’s requirement, like the PDB.68
Assuming arguendo that the PDB’s case falls under the second situation – i.e., the
BSP has jurisdiction to resolve the issue of ownership of the CB bills – the more
recent CB Circular No. 769-80 (Rules and Regulations Governing Central Bank
Certificates of Indebtedness) already superseded CB Circular No. 28, and, in
particular, effectively amended Section 10 (d) 4 of CB Circular No. 28. The
pertinent provisions of CB Circular No. 769-80 read:
Assignment Affected by Fraud. – Any assignment for transfer of ownership of
registered certificate obtained through fraudulent representation if honored by the
Central Bank or any of its authorized service agencies shall not make the Central
Bank or agency liable therefore unless it has previous formal notice of the fraud.
The Central Bank, upon notice under oath that the assignment was secured
through fraudulent means, shall immediately issue and circularize a "stop order"
against the transfer, exchange, redemption of the Certificate including the payment
of interest coupons. The Central Bank or service agency concerned shall continue
to withhold action on the certificate until such time that the conflicting claims have
been finally settled either by amicable settlement between the parties or by order
of the Court.
Unlike CB Circular No. 28, CB Circular No. 769-80 limited the BSP’s authority to
the mere issuance and circularization of a "stop order" against the transfer,
exchange and redemption upon sworn notice of a fraudulent assignment. Under
this Circular, the BSP shall only continue to withhold action until the dispute is
ended by an amicable settlement or by judicial determination. Given the more
passive stance of the BSP – the very agency tasked to enforce the circulars
involved - under CB Circular No. 769-80, the RTC’s dismissal of the BOC’s
counterclaims is palpably erroneous.
Lastly, since Nuqui’s office (Government Securities Department) had already been
abolished,69 it can no longer adjudicate the dispute under the second situation
covered by CB Circular No. 28. The abolition of Nuqui’s office is not only
consistent with the BSP’s Charter but, more importantly, with CB Circular No. 769-
80, which removed the BSP’s adjudicative authority over fraudulent assignments.
THE PDB’S COMMENT
The PDB claims that jurisdiction is determined by the allegations in the
complaint/petition and not by the defenses set up in the answer. 70 In filing the
petition with the RTC, the PDB merely seeks to compel the BSP to determine,
pursuant to CB Circular No. 28, the party legally entitled to the proceeds of the
subject CB bills, which, as the PDB alleged, have been transferred through
fraudulent representations – an allegation which properly recognized the BSP’s
jurisdiction to resolve conflicting claims of ownership over the CB bills.
The PDB adds that under the doctrine of primary jurisdiction, courts should refrain
from determining a controversy involving a question whose resolution demands the
exercise of sound administrative discretion. In the present case, the BSP’s special
knowledge and experience in resolving disputes on securities, whose assignment
and trading are governed by the BSP’s rules, should be upheld.
The PDB counters that the BOC’s tri-fold interpretation of Section 10 (d) 4 of CB
Circular No. 28 sanctions split jurisdiction which is not favored;but even this tri-fold
interpretation which, in the second situation, limits the meaning of the "owner" to
the registered owner is flawed. Section 10 (d) 4 aims to protect not just the
registered owner but anyone who has been deprived of his bond by fraudulent
representation in order to deter fraud in the secondary trading of government
securities.
The PDB asserts that the existence of CB Circular No. 769-80 or the abolition of
Nuqui’s office does not result in depriving the BSP of its jurisdiction: first, CB
Circular No. 769-80 expressly provides that CB Circular No. 28 shall have
suppletory application to CB Circular No. 769-80; and second, the BSP can always
designate an office to resolve the PDB’s claim over the CB bills.
Lastly, the PDB argues that even assuming that the RTC has jurisdiction to resolve
the issue of ownership of the CB bills, the RTC has not acquired jurisdiction over
the BOC’s so-called "compulsory" counterclaims (which in truth is merely
"permissive") because of the BOC’s failure to pay the appropriate docket fees.
These counterclaims should, therefore, be dismissed and expunged from the
record.
THE COURT’S RULING
We grant the petitions.
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At the outset, we note that the parties have not raised the validity of either CB
Circular No. 28 or CB Circular No. 769-80 as an issue. What the parties largely
contest is the applicable circular in case of an allegedly fraudulently assigned CB
bill. The applicable circular, in turn, is determinative of the proper remedy available
to the PDB and/or the BOC as claimants to the proceeds of the subject CB bills.
Indisputably, at the time the PDB supposedly invoked the jurisdiction of the BSP in
1994 (by requesting for the annotation of its claim over the subject CB bills in the
BSP’s books), CB Circular No. 769-80 has long been in effect. Therefore, the
parties’ respective interpretations of the provision of Section 10 (d) 4 of CB Circular
No. 28 do not have any significance unless it is first established that that Circular
governs the resolution of their conflicting claims of ownership. This conclusion is
important, given the supposed repeal or modification of Section 10 (d) 4 of CB
Circular No. 28 by the following provisions of CB Circular No. 769-80:
ARTICLE XI
SUPPLEMENTAL RULES
Section 1. Central Bank Circular No. 28 – The provisions of Central Bank Circular
No. 28 shall have suppletory application to matters not specially covered by these
Rules.
ARTICLE XII
EFFECTIVITY
Effectivity – The rules and regulations herein prescribed shall take effect upon
approval by the Monetary Board, Central Bank of the Philippines, and all circulars,
memoranda, or office orders inconsistent herewith are revoked or modified
accordingly. (Emphases added)
We agree with the PDB that in view of CB Circular No. 28’s suppletory application,
an attempt to harmonize the apparently conflicting provisions is a prerequisite
before one may possibly conclude that an amendment or a repeal
exists.71 Interestingly, however, even the PDB itself failed to submit an
interpretation based on its own position of harmonization.
The repealing clause of CB Circular No. 769-80 obviously did not expressly repeal
CB Circular No. 28; in fact, it even provided for the suppletory application of CB
Circular No. 28 on "matters not specially covered by" CB Circular No. 769-80.
While no express repeal exists, the intent of CB Circular No. 769-80 to operate as
an implied repeal,72or at least to amend earlier CB circulars, is supported by its text
"revoking" or "modif[ying" "all circulars" which are inconsistent with its terms.
At the outset, we stress that none of the parties disputes that the subject CB bills
fall within the category of a certificate or evidence of indebtedness and that these
were issued by the Central Bank, now the BSP. Thus, even without resorting to
statutory construction aids, matters involving the subject CB bills should
necessarily be governed by CB Circular No. 769-80. Even granting, however, that
reliance on CB Circular No. 769-80 alone is not enough, we find that CB Circular
No. 769-80 impliedly repeals CB Circular No. 28.
An implied repeal transpires when a substantial conflict exists between the new
and the prior laws. In the absence of an express repeal, a subsequent law cannot
be construed as repealing a prior law unless an irreconcilable inconsistency and
repugnancy exist in the terms of the new and the old laws.73 Repeal by implication
is not favored, unless manifestly intended by the legislature, or unless it is
convincingly and unambiguously demonstrated, that the laws or orders are clearly
repugnant and patently inconsistent with one another so that they cannot co-exist;
the legislature is presumed to know the existing law and would express a repeal if
one is intended.74
There are two instances of implied repeal. One takes place when the provisions in
the two acts on the same subject matter are irreconcilably contradictory, in which
case, the later act, to the extent of the conflict, constitutes an implied repeal of the
earlier one. The other occurs when the later act covers the whole subject of the
earlier one and is clearly intended as a substitute; thus, it will operate to repeal the
earlier law.75
A general reading of the two circulars shows that the second instance of implied
repeal is present in this case. CB Circular No. 28, entitled "Regulations Governing
Open Market Operations, Stabilization of Securities Market, Issue, Servicing and
Redemption of Public Debt," is a regulation governing the servicing and
redemption of public debt, including the issue, inscription, registration, transfer,
payment and replacement of bonds and securities representing the public
debt.76 On the other hand, CB Circular No. 769-80, entitled "Rules and Regulations
Governing Central Bank Certificate of Indebtedness," is the governing regulation
on matters77 (i) involving certificate of indebtedness78issued by the Central Bank
itself and (ii) which are similarly covered by CB Circular No. 28.
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The CB Monetary Board issued CB Circular No. 28 to regulate the servicing and
redemption of public debt, pursuant to Section 124 (now Section 119 of Republic
Act R.A. No. 7653) of the old Central Bank law79 which provides that "the servicing
and redemption of the public debt shall also be effected through the Bangko
Sentral." However, even as R.A. No. 7653 continued to recognize this role by the
BSP, the law required a phase-out of all fiscal agency functions by the BSP,
including Section 119 of R.A. No. 7653.
In other words, even if CB Circular No. 28 applies broadly to both government-
issued bonds and securities and Central Bank-issued evidence of indebtedness,
given the present state of law, CB Circular No. 28 and CB Circular No. 769-80 now
operate on the same subject – Central Bank-issued evidence of indebtedness.
Under Section 1, Article XI of CB Circular No. 769-80, the continued relevance and
application of CB Circular No. 28 would depend on the need to supplement any
deficiency or silence in CB Circular No. 769-80 on a particular matter.
In the present case, both CB Circular No. 28 and CB Circular No. 769-80 provide
the BSP with a course of action in case of an allegedly fraudulently assigned
certificate of indebtedness. Under CB Circular No. 28, in case of fraudulent
assignments, the BSP would have to "call upon the owner and the person
presenting the bond to substantiate their respective claims" and, from there,
determine who has a better right over the registered bond. On the other hand,
under CB Circular No. 769-80, the BSP shall merely "issue and circularize a ‘stop
order’ against the transfer, exchange, redemption of the [registered] certificate"
without any adjudicative function (which is the precise root of the present
controversy). As the two circulars stand, the patent irreconcilability of these two
provisions does not require elaboration. Section 5, Article V of CB Circular No.
769-80 inescapably repealed Section 10 (d) 4 of CB Circular No. 28.
The issue of BSP’s jurisdiction, lay hidden
On that note, the Court could have written finis to the present controversy by
simply sustaining the BSP’s hands-off approach to the PDB’s problem under CB
Circular No. 769-80. However, the jurisdictional provision of CB Circular No. 769-
80 itself, in relation to CB Circular No. 28, on the matter of fraudulent assignment,
has given rise to a question of jurisdiction - the core question of law involved in
these petitions - which the Court cannot just treat sub-silencio.
Broadly speaking, jurisdiction is the legal power or authority to hear and determine
a cause.80 In the exercise of judicial or quasi-judicial power, it refers to the authority
of a court to hear and decide a case.81 In the context of these petitions, we hark
back to the basic principles governing the question of jurisdiction over the subject
matter.
First, jurisdiction over the subject matter is determined only by the Constitution and
by law.82 As a matter of substantive law, procedural rules alone can confer no
jurisdiction to courts or administrative agencies.83 In fact, an administrative agency,
acting in its quasi-judicial capacity, is a tribunal of limited jurisdiction and, as such,
could wield only such powers that are specifically granted to it by the enabling
statutes. In contrast, an RTC is a court of general jurisdiction, i.e., it has jurisdiction
over cases whose subject matter does not fall within the exclusive original
jurisdiction of any court, tribunal or body exercising judicial or quasi-judicial
functions.84
Second, jurisdiction over the subject matter is determined not by the pleas set up
by the defendant in his answer85but by the allegations in the
complaint,86 irrespective of whether the plaintiff is entitled to favorable judgment on
the basis of his assertions.87 The reason is that the complaint is supposed to
contain a concise statement of the ultimate facts constituting the plaintiff's causes
of action.88
Third, jurisdiction is determined by the law in force at the time of the filing of the
complaint.89
Parenthetically, the Court observes that none of the parties ever raised the issue of
whether the BSP can simply disown its jurisdiction, assuming it has, by the simple
expedient of promulgating a new circular (specially applicable to a certificate of
indebtedness issued by the BSP itself), inconsistent with an old circular, assertive
of its limited jurisdiction over ownership issues arising from fraudulent assignments
of a certificate of indebtedness. The PDB, in particular, relied solely and heavily on
CB Circular No. 28.
In light of the above principles pointing to jurisdiction as a matter of substantive
law, the provisions of the law itself that gave CB Circular 769-80 its life and
jurisdiction must be examined.
The Philippine Central Bank
On January 3, 1949, Congress created the Central Bank of the Philippines (Central
Bank) as a corporate body with the primary objective of (i) maintaining the internal
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and external monetary stability in the Philippines; and (ii) preserving the
international value and the convertibility of the peso.90 In line with these broad
objectives, the Central Bank was empowered to issue rules and regulations
"necessary for the effective discharge of the responsibilities and exercise of the
powers assigned to the Monetary Board and to the Central Bank."91 Specifically,
the Central Bank is authorized to organize (other) departments for the efficient
conduct of its business and whose powers and duties "shall be determined by the
Monetary Board, within the authority granted to the Board and the Central
Bank"92 under its original charter.
With the 1973 Constitution, the then Central Bank was constitutionally made as the
country’s central monetary authority until such time that Congress 93 shall have
established a central bank. The 1987 Constitution continued to recognize this
function of the then Central Bank until Congress, pursuant to the Constitution,
created a new central monetary authority which later came to be known as the
Bangko Sentral ng Pilipinas.
Under the New Central Bank Act (R.A. No. 7653),94 the BSP is given the
responsibility of providing policy directions in the areas of money, banking and
credit; it is given, too, the primary objective of maintaining price stability, conducive
to a balanced and sustainable growth of the economy, and of promoting and
maintaining monetary stability and convertibility of the peso.95
The Constitution expressly grants the BSP, as the country’s central monetary
authority, the power of supervision over the operation of banks, while leaving with
Congress the authority to define the BSP’s regulatory powers over the operations
of finance companies and other institutions performing similar functions. Under
R.A. No. 7653, the BSP’s powers and functions include (i) supervision over the
operation of banks; (ii) regulation of operations of finance companies and non-
bank financial institutions performing quasi banking functions; (iii) sole power and
authority to issue currency within the Philippine territory; (iv) engaging in foreign
exchange transactions; (v) making rediscounts, discounts, loans and advances to
banking and other financial institutions to influence the volume of credit consistent
with the objective of achieving price stability; (vi) engaging in open market
operations; and (vii) acting as banker and financial advisor of the
government.1âwphi1
On the BSP’s power of supervision over the operation of banks, Section 4 of R.A.
No. 8791 (The General Banking Law of 2000) elaborates as follows:
CHAPTER II
AUTHORITY OF THE BANGKO SENTRAL
SECTION 4. Supervisory Powers. — The operations and activities of banks shall
be subject to supervision of the Bangko Sentral. "Supervision" shall include the
following:
4.1. The issuance of rules of conduct or the establishment of standards of
operation for uniform application to all institutions or functions covered,
taking into consideration the distinctive character of the operations of
institutions and the substantive similarities of specific functions to which
such rules, modes or standards are to be applied;
4.2. The conduct of examination to determine compliance with laws and
regulations if the circumstances so warrant as determined by the Monetary
Board;
4.3. Overseeing to ascertain that laws and regulations are complied with;
4.4. Regular investigation which shall not be oftener than once a year from
the last date of examination to determine whether an institution is
conducting its business on a safe or sound basis: Provided, That the
deficiencies/irregularities found by or discovered by an audit shall be
immediately addressed;
4.5. Inquiring into the solvency and liquidity of the institution (2-D); or
4.6. Enforcing prompt corrective action. (n)
The Bangko Sentral shall also have supervision over the operations of and
exercise regulatory powers over quasi-banks, trust entities and other financial
institutions which under special laws are subject to Bangko Sentral supervision. (2-
Ca)
For the purposes of this Act, "quasi-banks" shall refer to entities engaged in the
borrowing of funds through the issuance, endorsement or assignment with
recourse or acceptance of deposit substitutes as defined in Section 95 of Republic
Act No. 7653 (hereafter the "New Central Bank Act") for purposes of relending or
purchasing of receivables and other obligations. [emphasis ours]
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While this provision empowers the BSP to oversee the operations and activities of
banks to "ascertain that laws and regulations are complied with," the existence of
the BSP’s jurisdiction in the present dispute cannot rely on this provision. The fact
remains that the BSP already made known to the PDB its unfavorable position on
the latter’s claim of fraudulent assignment due to the latter’s own failure to
comply96 with existing regulations:
In this connection, Section 10 (b) 2 also requires that a "Detached assignment will
be recognized or accepted only upon previous notice to the Central Bank x x x." In
fact, in a memo dated September 23, 1991 xxx then CB Governor Jose L. Cuisia
advised all banks (including PDB) xxx as follows:
In view recurring incidents ostensibly disregarding certain provisions of CB circular
No. 28 (as amended) covering assignments of registered bonds, all banks and all
concerned are enjoined to observe strictly the pertinent provisions of said CB
Circular as hereunder quoted:
xxxx
Under Section 10.b. (2)
x x x Detached assignment will be recognized or accepted only upon previous
notice to the Central Bank and its use is authorized only under the following
circumstances:
(a) x x x
(b) x x x
(c) assignments of treasury notes and certificates of indebtedness in
registered form which are not provided at the back thereof with assignment
form.
(d) Assignment of securities which have changed ownership several times.
(e) x x x
Non-compliance herewith will constitute a basis for non-action or withholding of
action on redemption/payment of interest coupons/transfer transactions or
denominational exchange that may be directly affected thereby. [Boldfacing
supplied]
Again, the books of the BSP do not show that the supposed assignment of subject
CB Bills was ever recorded in the BSP’s books. [Boldfacing supplied]
However, the PDB faults the BSP for not recording the assignment of the CB bills
in the PDB’s favor despite the fact that the PDB already requested the BSP to
record its assignment in the BSP’s books as early as June 30, 1994.97
The PDB’s claim is not accurate. What the PDB requested the BSP on that date
was not the recording of the assignment of the CB bills in its favor but the
annotation of its claim over the CB bills at the time when (i) it was no longer in
possession of the CB bills, having been transferred from one entity to another and
(ii) all it has are the detached assignments, which the PDB has not shown to be
compliant with Section 10 (b) 2 above-quoted. Obviously, the PDB cannot insist
that the BSP take cognizance of its plaint when the basis of the BSP’s refusal
under existing regulation, which the PDB is bound to observe, is the PDB’s own
failure to comply therewith.
True, the BSP exercises supervisory powers (and regulatory powers) over banks
(and quasi banks). The issue presented before the Court, however, does not
concern the BSP’s supervisory power over banks as this power is understood
under the General Banking Law. In fact, there is nothing in the PDB’s petition
(even including the letters it sent to the BSP) that would support the BSP’s
jurisdiction outside of CB Circular No. 28, under its power of supervision, over
conflicting claims to the proceeds of the CB bills.
BSP has quasi-judicial powers over a
class of cases which does not include
the adjudication of ownership of the
CB bills in question
In United Coconut Planters Bank v. E. Ganzon, Inc.,98 the Court considered the
BSP as an administrative agency,99exercising quasi-judicial functions through its
Monetary Board. It held:
A quasi-judicial agency or body is an organ of government other than a court and
other than a legislature, which affects the rights of private parties through either
adjudication or rule-making. The very definition of an administrative agency
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includes its being vested with quasi-judicial powers. The ever increasing variety of
powers and functions given to administrative agencies recognizes the need for the
active intervention of administrative agencies in matters calling for technical
knowledge and speed in countless controversies which cannot possibly be
handled by regular courts. A "quasi-judicial function" is a term which applies to the
action, discretion, etc., of public administrative officers or bodies, who are required
to investigate facts, or ascertain the existence of facts, hold hearings, and draw
conclusions from them, as a basis for their official action and to exercise discretion
of a judicial nature.
Undoubtedly, the BSP Monetary Board is a quasi-judicial agency exercising quasi-
judicial powers or functions. As aptly observed by the Court of Appeals, the BSP
Monetary Board is an independent central monetary authority and a body
corporate with fiscal and administrative autonomy, mandated to provide policy
directions in the areas of money, banking and credit. It has power to issue
subpoena, to sue for contempt those refusing to obey the subpoena without
justifiable reason, to administer oaths and compel presentation of books, records
and others, needed in its examination, to impose fines and other sanctions and to
issue cease and desist order. Section 37 of Republic Act No. 7653, in particular,
explicitly provides that the BSP Monetary Board shall exercise its discretion in
determining whether administrative sanctions should be imposed on banks and
quasi-banks, which necessarily implies that the BSP Monetary Board must conduct
some form of investigation or hearing regarding the same. [citations omitted]
The BSP is not simply a corporate entity but qualifies as an administrative agency
created, pursuant to constitutional mandate,100 to carry out a particular
governmental function.101 To be able to perform its role as central monetary
authority, the Constitution granted it fiscal and administrative autonomy. In general,
administrative agencies exercise powers and/or functions which may be
characterized as administrative, investigatory, regulatory, quasi-legislative, or
quasi-judicial, or a mix of these five, as may be conferred by the Constitution or by
statute.102
While the very nature of an administrative agency and the raison d'être for its
creation103 and proliferation dictate a grant of quasi-judicial power to it, the matters
over which it may exercise this power must find sufficient anchorage on its
enabling law, either by express provision or by necessary implication. Once found,
the quasi-judicial power partakes of the nature of a limited and special jurisdiction,
that is, to hear and determine a class of cases within its peculiar competence and
expertise. In other words, the provisions of the enabling statute are the yardsticks
by which the Court would measure the quantum of quasi-judicial powers an
administrative agency may exercise, as defined in the enabling act of such
agency.104
Scattered provisions in R.A. No. 7653 and R.A. No. 8791, inter alia, exist,
conferring jurisdiction on the BSP on certain matters.105 For instance, under the
situations contemplated under Section 36, par. 2106 (where a bank or quasi bank
persists in carrying on its business in an unlawful or unsafe manner) and Section
37107 (where the bank or its officers willfully violate the bank’s charter or by-laws, or
the rules and regulations issued by the Monetary Board) of R.A. No. 7653, the
BSP may place an entity under receivership and/or liquidation or impose
administrative sanctions upon the entity or its officers or directors.
Among its several functions under R.A. No. 7653, the BSP is authorized to engage
in open market operations and thereby "issue, place, buy and sell freely negotiable
evidences of indebtedness of the Bangko Sentral" in the following manner.
SEC. 90. Principles of Open Market Operations. – The open market purchases
and sales of securities by the Bangko Sentral shall be made exclusively in
accordance with its primary objective of achieving price stability.
xxxx
SEC. 92. Issue and Negotiation of Bangko Sentral Obligations. – In order to
provide the Bangko Sentral with effective instruments for open market operations,
the Bangko Sentral may, subject to such rules and regulations as the Monetary
Board may prescribe and in accordance with the principles stated in Section 90 of
this Act, issue, place, buy and sell freely negotiable evidences of indebtedness of
the Bangko Sentral: Provided, That issuance of such certificates of indebtedness
shall be made only in cases of extraordinary movement in price levels. Said
evidences of indebtedness may be issued directly against the international reserve
of the Bangko Sentral or against the securities which it has acquired under the
provisions of Section 91 of this Act, or may be issued without relation to specific
types of assets of the Bangko Sentral.
The Monetary Board shall determine the interest rates, maturities and other
characteristics of said obligations of the Bangko Sentral, and may, if it deems it
advisable, denominate the obligations in gold or foreign currencies.
Subject to the principles stated in Section 90 of this Act, the evidences of
indebtedness of the Bangko Sentral to which this section refers may be acquired
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by the Bangko Sentral before their maturity, either through purchases in the open
market or through redemptions at par and by lot if the Bangko Sentral has
reserved the right to make such redemptions. The evidences of indebtedness
acquired or redeemed by the Bangko Sentral shall not be included among its
assets, and shall be immediately retired and cancelled. 108 (italics supplied;
emphases ours)
The primary objective of the BSP is to maintain price stability. 109 The BSP has a
number of monetary policy instruments at its disposal to promote price stability. To
increase or reduce liquidity in the financial system, the BSP uses open market
operations, among others.110 Open market operation is a monetary tool where the
BSP publicly buys or sells government securities111 from (or to) banks and financial
institutions in order to expand or contract the supply of money. By controlling the
money supply, the BSP is able to exert some influence on the prices of goods and
services and achieve its inflation objectives.112
Once the issue and/or sale of a security is made, the BSP would necessarily make
a determination, in accordance with its own rules, of the entity entitled to receive
the proceeds of the security upon its maturity. This determination by the BSP is an
exercise of its administrative powers113 under the law as an incident to its power to
prescribe rules and regulations governing open market operations to achieve the
"primary objective of achieving price stability."114As a matter of necessity, too, the
same rules and regulations facilitate transaction with the BSP by providing for an
orderly manner of, among others, issuing, transferring, exchanging and paying
securities representing public debt.
Significantly, when competing claims of ownership over the proceeds of the
securities it has issued are brought before it, the law has not given the BSP the
quasi-judicial power to resolve these competing claims as part of its power to
engage in open market operations. Nothing in the BSP’s charter confers on the
BSP the jurisdiction or authority to determine this kind of claims, arising out of a
subsequent transfer or assignment of evidence of indebtedness – a matter that
appropriately falls within the competence of courts of general jurisdiction. That the
statute withholds this power from the BSP is only consistent with the fundamental
reasons for the creation of a Philippine central bank, that is, to lay down stable
monetary policy and exercise bank supervisory functions. Thus, the BSP’s
assumption of jurisdiction over competing claims cannot find even a stretched-out
justification under its corporate powers "to do and perform any and all things that
may be necessary or proper to carry out the purposes" of R.A. No. 7653. 115
To reiterate, open market operation is a monetary policy instrument that the BSP
employs, among others, to regulate the supply of money in the economy to
influence the timing, cost and availability of money and credit, as well as other
financial factors, for the purpose of stabilizing the price level.116 What the law
grants the BSP is a continuing role to shape and carry out the country’s monetary
policy – not the authority to adjudicate competing claims of ownership over the
securities it has issued – since this authority would not fall under the BSP’s
purposes under its charter.
While R.A. No. 7653117 empowers the BSP to conduct administrative hearings and
render judgment for or against an entity under its supervisory and regulatory
powers and even authorizes the BSP Governor to "render decisions, or rulings x x
x on matters regarding application or enforcement of laws pertaining to institutions
supervised by the BSP and laws pertaining to quasi-banks, as well as regulations,
policies or instructions issued by the Monetary Board," it is precisely the text of the
BSP’s own regulation (whose validity is not here raised as an issue) that points to
the BSP’s limited role in case of an allegedly fraudulent assignment to simply (i)
issuing and circularizing a ‘"stop order" against the transfer, exchange, redemption
of the certificate of indebtedness, including the payment of interest coupons, and
(ii) withholding action on the certificate.
A similar conclusion can be drawn from the BSP’s administrative adjudicatory
power in cases of "willful failure or refusal to comply with, or violation of, any
banking law or any order, instruction or regulation issued by the Monetary Board,
or any order, instruction or ruling by the Governor."118 The non-compliance with the
pertinent requirements under CB Circular No. 28, as amended, deprives a party
from any right to demand payment from the BSP.
In other words, the grant of quasi-judicial authority to the BSP cannot possibly
extend to situations which do not call for the exercise by the BSP of its supervisory
or regulatory functions over entities within its jurisdiction.119
The fact alone that the parties involved are banking institutions does not
necessarily call for the exercise by the BSP of its quasi-judicial powers under the
law.120
The doctrine of primary jurisdiction
argues against BSP’s purported
authority to adjudicate ownership
issues over the disputed CB bills
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Given the preceding discussions, even the PDB’s invocation of the doctrine of
primary jurisdiction is misplaced.
In the exercise of its plenary legislative power, Congress may create administrative
agencies endowed with quasi-legislative and quasi-judicial powers. Necessarily,
Congress likewise defines the limits of an agency’s jurisdiction in the same manner
as it defines the jurisdiction of courts.121 As a result, it may happen that either a
court or an administrative agency has exclusive jurisdiction over a specific matter
or both have concurrent jurisdiction on the same. It may happen, too, that courts
and agencies may willingly relinquish adjudicatory power that is rightfully theirs in
favor of the other. One of the instances when a court may properly defer to the
adjudicatory authority of an agency is the applicability of the doctrine of primary
jurisdiction.122
As early as 1954, the Court applied the doctrine of primary jurisdiction under the
following terms:
6. In the fifties, the Court taking cognizance of the move to vest jurisdiction in
administrative commissions and boards the power to resolve specialized disputes
xxx ruled that Congress in requiring the Industrial Court's intervention in the
resolution of labor-management controversies xxx meant such jurisdiction to be
exclusive, although it did not so expressly state in the law. The Court held that
under the "sense-making and expeditious doctrine of primary jurisdiction ... the
courts cannot or will not determine a controversy involving a question which is
within the jurisdiction of an administrative tribunal, where the question demands
the exercise of sound administrative discretion requiring the special knowledge,
experience, and services of the administrative tribunal to determine technical and
intricate matters of fact, and a uniformity of ruling is essential to comply with the
purposes of the regulatory statute administered."123 (emphasis ours)
In Industrial Enterprises, Inc. v. Court of Appeals,124 the Court ruled that while an
action for rescission of a contract between coal developers appears to be an action
cognizable by regular courts, the trial court remains to be without jurisdiction to
entertain the suit since the contract sought to be rescinded is "inextricably tied up
with the right to develop coal-bearing lands and the determination of whether or
not the reversion of the coal operating contract over the subject coal blocks to [the
plaintiff] would be in line with the country’s national program and objective on coal-
development and over-all coal-supply-demand balance." It then applied the
doctrine of primary jurisdiction –
In recent years, it has been the jurisprudential trend to apply the doctrine of
primary jurisdiction in many cases involving matters that demand the special
competence of administrative agencies. It may occur that the Court has jurisdiction
to take cognizance of a particular case, which means that the matter involved is
also judicial in character. However, if the case is such that its determination
requires the expertise, specialized skills and knowledge of the proper
administrative bodies because technical matters or intricate questions of facts are
involved, then relief must first be obtained in an administrative proceeding before a
remedy will be supplied by the courts even though the matter is within the proper
jurisdiction of a court. This is the doctrine of primary jurisdiction. It applies "where a
claim is originally cognizable in the courts, and comes into play whenever
enforcement of the claim requires the resolution of issues which, under a
regulatory scheme, have been placed within the special competence of an
administrative body."
Clearly, the doctrine of primary jurisdiction finds application in this case since the
question of what coal areas should be exploited and developed and which entity
should be granted coal operating contracts over said areas involves a technical
determination by the Bureau of Energy Development as the administrative agency
in possession of the specialized expertise to act on the matter. The Trial Court
does not have the competence to decide matters concerning activities relative to
the exploration, exploitation, development and extraction of mineral resources like
coal. These issues preclude an initial judicial determination. [emphases ours]
The absence of any express or implied statutory power to adjudicate conflicting
claims of ownership or entitlement to the proceeds of its certificates of
indebtedness finds complement in the similar absence of any technical matter that
would call for the BSP’s special expertise or competence.125 In fact, what the
PDB’s petitions bear out is essentially the nature of the transaction it had with the
subsequent transferees of the subject CB bills (BOC and Bancap) and not any
matter more appropriate for special determination by the BSP or any administrative
agency.
In a similar vein, it is well-settled that the interpretation given to a rule or regulation
by those charged with its execution is entitled to the greatest weight by the courts
construing such rule or regulation.126 While there are exceptions127 to this rule, the
PDB has not convinced us that a departure is warranted in this case. Given the
non-applicability of the doctrine of primary jurisdiction, the BSP’s own position, in
light of Circular No. 769-80, deserves respect from the Court.
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Ordinarily, cases involving the application of doctrine of primary jurisdiction are
initiated by an action invoking the jurisdiction of a court or administrative agency to
resolve the substantive legal conflict between the parties. In this sense, the
present case is quite unique since the court’s jurisdiction was, originally, invoked to
compel an administrative agency (the BSP) to resolve the legal conflict of
ownership over the CB bills - instead of obtaining a judicial determination of the
same dispute.
The remedy of interpleader
Based on the unique factual premise of the present case, the RTC acted correctly
in initially assuming jurisdiction over the PDB’s petition for mandamus, prohibition
and injunction.128 While the RTC agreed (albeit erroneously) with the PDB’s view
(that the BSP has jurisdiction), it, however, dismissed not only the BOC’s/the
BSP’s counterclaims but the PDB’s petition itself as well, on the ground that it
lacks jurisdiction.
This is plain error.
Not only the parties themselves, but more so the courts, are bound by the rule on
non-waiver of jurisdiction.129believes that jurisdiction over the BOC’s counterclaims
and the BSP’s counterclaim/crossclaim for interpleader calls for the application of
the doctrine of primary jurisdiction, the allowance of the PDB’s petition even
becomes imperative because courts may raise the issue of primary jurisdiction sua
sponte.130
Of the three possible options available to the RTC, the adoption of either of these
two would lead the trial court into serious legal error: first, if it granted the PDB’s
petition, its decision would have to be set aside on appeal because the BSP has
no jurisdiction as previously discussed; and second when it dismissed the PDB’s
petitions and the BOC’s counterclaims on the ground that it lacks jurisdiction, the
trial court seriously erred because precisely, the resolution of the conflicting claims
over the CB bills falls within its general jurisdiction.
Without emasculating its jurisdiction, the RTC could have properly dismissed the
PDB’s petition but on the ground that mandamus does not lie against the BSP; but
even this correct alternative is no longer plausible since the BSP, as a respondent
below, already properly brought before the RTC the remaining conflicting claims
over the subject CB bills by way of a counterclaim/crossclaim for interpleader.
Section 1, Rule 62 of the Rules of Court provides when an interpleader is proper:
SECTION 1. When interpleader proper. – Whenever conflicting claims upon the
same subject matter are or may be made against a person who claims no interest
whatever in the subject matter, or an interest which in whole or in part is not
disputed by the claimants, he may bring an action against the conflicting claimants
to compel them to interplead and litigate their several claims among themselves.
The remedy of an action of interpleader131 is designed to protect a person against
double vexation in respect of a single liability.7 It requires, as an indispensable
requisite, that conflicting claims upon the same subject matter are or may be made
against the stakeholder (the possessor of the subject matter) who claims no
interest whatever in the subject matter or an interest which in whole or in part is not
disputed by the claimants.132
Through this remedy, the stakeholder can join all competing claimants in a single
proceeding to determine conflicting claims without exposing the stakeholder to the
possibility of having to pay more than once on a single liability. 133
When the court orders that the claimants litigate among themselves, in reality a
new action arises,134 where the claims of the interpleaders themselves are brought
to the fore, the stakeholder as plaintiff is relegated merely to the role of initiating
the suit. In short, the remedy of interpleader, when proper, merely provides an
avenue for the conflicting claims on the same subject matter to be threshed out in
an action. Section 2 of Rule 62 provides:
SEC. 2. Order. – Upon the filing of the complaint, the court shall issue an order
requiring the conflicting claimants to interplead with one another. If the interests of
justice so require, the court may direct in such order that the subject matter be paid
or delivered to the court.
This is precisely what the RTC did by granting the BSP’s motion to interplead. The
PDB itself "agreed that the various claimants should now interplead." Thus, the
PDB and the BOC subsequently entered into two separate escrow agreements,
covering the CB bills, and submitted them to the RTC for approval.
In granting the BSP’s motion, the RTC acted on the correct premise that it has
jurisdiction to resolve the parties’ conflicting claims over the CB bills - consistent
with the rules and the parties’ conduct - and accordingly required the BOC to
amend its answer and for the PDB to comment thereon. Suddenly, however, the
PDB made an about-face and questioned the jurisdiction of the RTC. Swayed by
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the PDB’s argument, the RTC dismissed even the PDB’s petition - which means
that it did not actually compel the BSP to resolve the BOC’s and the PDB’s claims.
Without the motion to interplead and the order granting it, the RTC could only
dismiss the PDB’s petition since it is the RTC which has jurisdiction to resolve the
parties’ conflicting claims – not the BSP. Given that the motion to interplead has
been actually filed, the RTC could not have really granted the relief originally
sought in the PDB’s petition since the RTC’s order granting the BSP’s motion to
interplead - to which the PDB in fact acquiesced into - effectively resulted in the
dismissal of the PDB’s petition. This is not altered by the fact that the PDB
additionally prayed in its petition for damages, attorney’s fees and costs of suit
"against the public respondents" because the grant of the order to interplead
effectively sustained the propriety of the BSP’s resort to this procedural device.
Interpleader
1. as a special civil action
What is quite unique in this case is that the BSP did not initiate the interpleader
suit through an original complaint but through its Answer. This circumstance
becomes understandable if it is considered that insofar as the BSP is concerned,
the PDB does not possess any right to have its claim recorded in the BSP’s books;
consequently, the PDB cannot properly be considered even as a potential claimant
to the proceeds of the CB bills upon maturity. Thus, the interpleader was only an
alternative position, made only in the BSP’s Answer.135
The remedy of interpleader, as a special civil action, is primarily governed by the
specific provisions in Rule 62 of the Rules of Court and secondarily by the
provisions applicable to ordinary civil actions.136 Indeed, Rule 62 does not
expressly authorize the filing of a complaint-in-interpleader as part of, although
separate and independent from, the answer. Similarly, Section 5, Rule 6, in
relation to Section 1, Rule 9 of the Rules of Court137 does not include a complaint-
in-interpleader as a claim,138 a form of defense,139 or as an objection that a
defendant may be allowed to put up in his answer or in a motion to dismiss. This
does not mean, however, that the BSP’s "counter-complaint/cross-claim for
interpleader" runs counter to general procedures.
Apart from a pleading,140 the rules141 allow a party to seek an affirmative relief from
the court through the procedural device of a motion. While captioned "Answer with
counter complaint/cross-claim for interpleader," the RTC understood this as in the
nature of a motion,142 seeking relief which essentially consists in an order for the
conflicting claimants to litigate with each other so that "payment is made to the
rightful or legitimate owner"143 of the subject CB bills.
The rules define a "civil action" as "one by which a party sues another for the
enforcement or protection of a right, or the prevention or redress of a wrong."
Interpleader may be considered as a stakeholder’s remedy to prevent a wrong,
that is, from making payment to one not entitled to it, thereby rendering itself
vulnerable to lawsuit/s from those legally entitled to payment.
Interpleader is a civil action made special by the existence of particular rules to
govern the uniqueness of its application and operation. Under Section 2, Rule 6 of
the Rules of Court, governing ordinary civil actions, a party’s claim is asserted "in a
complaint, counterclaim, cross-claim, third (fourth, etc.)-party complaint, or
complaint-in-intervention." In an interpleader suit, however, a claim is not required
to be contained in any of these pleadings but in the answer-(of the conflicting
claimants)-in-interpleader. This claim is different from the counter-claim (or cross-
claim, third party-complaint) which is separately allowed under Section 5, par. 2 of
Rule 62.
2. the payment of docket fees covering BOC’s counterclaim
The PDB argues that, even assuming that the RTC has jurisdiction over the issue
of ownership of the CB bills, the BOC’s failure to pay the appropriate docket fees
prevents the RTC from acquiring jurisdiction over the BOC’s "counterclaims."
We disagree with the PDB.
To reiterate and recall, the order granting the "PDB’s motion to interplead," already
resulted in the dismissal of the PDB’s petition. The same order required the BOC
to amend its answer and for the conflicting claimants to comment, presumably to
conform to the nature of an answer-in interpleader. Perhaps, by reason of the
BOC’s denomination of its claim as a "compulsory counterclaim" and the PDB’s
failure to fully appreciate the RTC’s order granting the "BSP’s motion for
interpleader" (with the PDB’s conformity), the PDB mistakenly treated the BOC’s
claim as a "permissive counterclaim" which necessitates the payment of docket
fees.
As the preceding discussions would show, however, the BOC’s "claim" - i.e., its
assertion of ownership over the CB bills – is in reality just that, a "claim" against
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the stakeholder and not as a "counterclaim,"144 whether compulsory145or
permissive. It is only the BOC’s alternative prayer (for the PDB to deliver to the
BOC, as the buyer in the April 15 transaction and the ultimate successor-in-interest
of the buyer in the April 19 transaction, either the original subjects of the sales or
the value thereof plus whatever income that may have been earned pendente lite)
and its prayer for damages that are obviously compulsory counterclaims against
the PDB and, therefore, does not require payment of docket fees.146
The PDB takes a contrary position through its insistence that a compulsory
counterclaim should be one where the presence of third parties, of whom the court
cannot acquire jurisdiction, is not required. It reasons out that since the RCBC and
All Asia (the intervening holders of the CB bills) have already been dropped from
the case, then the BOC’s counterclaim must only be permissive in nature and the
BOC should have paid the correct docket fees.
We see no reason to belabor this claim. Even if we gloss over the PDB’s own
conformity to the dropping of these entities as parties, the BOC correctly argues
that a remedy is provided under the Rules. Section 12, Rule 6 of the Rules of
Court reads:
SEC. 12. Bringing new parties. – When the presence of parties other than those to
the original action is required for the granting of complete relief in the
determination of a counterclaim or cross-claim, the court shall order them to be
brought in as defendants, if jurisdiction over them can be obtained.
Even then, the strict characterization of the BOC’s counterclaim is no longer
material in disposing of the PDB’s argument based on non-payment of docket
fees.
When an action is filed in court, the complaint must be accompanied by the
payment of the requisite docket and filing fees by the party seeking affirmative
relief from the court. It is the filing of the complaint or appropriate initiatory
pleading, accompanied by the payment of the prescribed docket fee, that vests a
trial court with jurisdiction over the claim or the nature of the action.147 However,
the non-payment of the docket fee at the time of filing does not automatically
cause the dismissal of the case, so long as the fee is paid within the applicable
prescriptive or reglementary period, especially when the claimant demonstrates a
willingness to abide by the rules prescribing such payment.148
In the present case, considering the lack of a clear guideline on the payment of
docket fee by the claimants in an interpleader suit, compounded by the unusual
manner in which the interpleader suit was initiated and the circumstances
surrounding it, we surely cannot deduce from the BOC’s mere failure to specify in
its prayer the total amount of the CB bills it lays claim to (or the value of the
subjects of the sales in the April 15 and April 19 transactions, in its alternative
prayer) an intention to defraud the government that would warrant the dismissal of
its claim.149
At any rate, regardless of the nature of the BOC’s "counterclaims," for purposes of
payment of filing fees, both the BOC and the PDB, properly as defendants-in-
interpleader, must be assessed the payment of the correct docket fee arising from
their respective claims. The seminal case of Sun Insurance Office, Ltd. v. Judge
Asuncion150 provides us guidance in the payment of docket fees, to wit:
1. x x x Where the filing of the initiatory pleading is not accompanied by
payment of the docket fee, the court may allow payment of the fee within a
reasonable time but in no case beyond the applicable prescriptive or
reglementary period.
2. The same rule applies to permissive counterclaims, third-party claims
and similar pleadings, which shall not be considered filed until and unless
the filing fee prescribed therefor is paid. The court may also allow payment
of said fee within a reasonable time but also in no case beyond its
applicable prescriptive or reglementary period. [underscoring ours]
This must be the rule considering that Section 7, Rule 62 of which reads:
SEC. 7. Docket and other lawful fees, costs and litigation expenses as liens. – The
docket and other lawful fees paid by the party who filed a complaint under this
Rule, as well as the costs and litigation expenses, shall constitute a lien or charge
upon the subject matter of the action, unless the court shall order otherwise.
only pertain to the docket and lawful fees to be paid by the one who initiated the
interpleader suit, and who, under the Rules, actually "claims no interest whatever
in the subject matter." By constituting a lien on the subject matter of the action,
Section 7 in effect only aims to actually compensate the complainant-in-
interpleader, who happens to be the stakeholder unfortunate enough to get caught
in a legal crossfire between two or more conflicting claimants, for the faultless
trouble it found itself into. Since the defendants-in-interpleader are actually the
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ones who make a claim - only that it was extraordinarily done through the
procedural device of interpleader - then to them devolves the duty to pay the
docket fees prescribed under Rule 141 of the Rules of Court, as amended.151
The importance of paying the correct amount of docket fee cannot be
overemphasized:
The matter of payment of docket fees is not a mere triviality. These fees are
necessary to defray court expenses in the handling of cases. Consequently, in
order to avoid tremendous losses to the judiciary, and to the government as well,
the payment of docket fees cannot be made dependent on the outcome of the
case, except when the claimant is a pauper-litigant.152
WHEREFORE, premises considered the consolidated PETITIONS are GRANTED.
The Planters Development Bank is hereby REQUIRED to file with the Regional
Trial Court its comment or answer-in-interpleader to Bank of Commerce’s
Amended Consolidated Answer with Compulsory Counterclaim, as previously
ordered by the Regional Trial Court. The Regional Trial Court of Makati City,
Branch 143, is hereby ORDERED to assess the docket fees due from Planters
Development Bank and Bank of Commerce and order their payment, and to
resolve with DELIBERATE DISPATCH the parties’ conflicting claims of ownership
over the proceeds of the Central Bank bills.
The Clerk of Court of the Regional Trial Court of Makati City, Branch 143, or his
duly authorized representative is hereby ORDERED to assess and collect the
appropriate amount of docket fees separately due the Bank of Commerce and
Planters Development Bank as conflicting claimants in Bangko Sentral ng
Pilipinas’ interpleader suit, in accordance with this decision.
SO ORDERED.
DECLARATORY RELIEF AND SIMILAR REMEDIES
G.R. No. 150806 January 28, 2008
EUFEMIA ALMEDA and ROMEL ALMEDA, petitioners,
vs.
BATHALA MARKETING INDUSTRIES, INC., respondent.
DECISION
NACHURA, J.:
This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court, of
the Decision1 of the Court of Appeals (CA), dated September 3, 2001, in CA-G.R.
CV No. 67784, and its Resolution2 dated November 19, 2001. The assailed
Decision affirmed with modification the Decision3 of the Regional Trial Court
(RTC), Makati City, Branch 136, dated May 9, 2000 in Civil Case No. 98-411.
Sometime in May 1997, respondent Bathala Marketing Industries, Inc., as lessee,
represented by its president Ramon H. Garcia, renewed its Contract of Lease 4 with
Ponciano L. Almeda (Ponciano), as lessor, husband of petitioner Eufemia and
father of petitioner Romel Almeda. Under the said contract, Ponciano agreed to
lease a portion of the Almeda Compound, located at 2208 Pasong Tamo Street,
Makati City, consisting of 7,348.25 square meters, for a monthly rental
of P1,107,348.69, for a term of four (4) years from May 1, 1997 unless sooner
terminated as provided in the contract.5 The contract of lease contained the
following pertinent provisions which gave rise to the instant case:
SIXTH - It is expressly understood by the parties hereto that the rental rate
stipulated is based on the present rate of assessment on the property, and
that in case the assessment should hereafter be increased or any new tax,
charge or burden be imposed by authorities on the lot and building where
the leased premises are located, LESSEE shall pay, when the rental
herein provided becomes due, the additional rental or charge
corresponding to the portion hereby leased; provided, however, that in the
event that the present assessment or tax on said property should be
reduced, LESSEE shall be entitled to reduction in the stipulated rental,
likewise in proportion to the portion leased by him;
SEVENTH - In case an extraordinary inflation or devaluation of Philippine
Currency should supervene, the value of Philippine peso at the time of the
establishment of the obligation shall be the basis of payment;6
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During the effectivity of the contract, Ponciano died. Thereafter, respondent dealt
with petitioners. In a letter7 dated December 29, 1997, petitioners advised
respondent that the former shall assess and collect Value Added Tax (VAT) on its
monthly rentals. In response, respondent contended that VAT may not be imposed
as the rentals fixed in the contract of lease were supposed to include the VAT
therein, considering that their contract was executed on May 1, 1997 when the
VAT law had long been in effect.8
On January 26, 1998, respondent received another letter from petitioners informing
the former that its monthly rental should be increased by 73% pursuant to
condition No. 7 of the contract and Article 1250 of the Civil Code. Respondent
opposed petitioners' demand and insisted that there was no extraordinary inflation
to warrant the application of Article 1250 in light of the pronouncement of this Court
in various cases.9
Respondent refused to pay the VAT and adjusted rentals as demanded by
petitioners but continued to pay the stipulated amount set forth in their contract.
On February 18, 1998, respondent instituted an action for declaratory relief for
purposes of determining the correct interpretation of condition Nos. 6 and 7 of the
lease contract to prevent damage and prejudice.10 The case was docketed as Civil
Case No. 98-411 before the RTC of Makati.
On March 10, 1998, petitioners in turn filed an action for ejectment, rescission and
damages against respondent for failure of the latter to vacate the premises after
the demand made by the former.11 Before respondent could file an answer,
petitioners filed a Notice of Dismissal.12 They subsequently refiled the complaint
before the Metropolitan Trial Court of Makati; the case was raffled to Branch 139
and was docketed as Civil Case No. 53596.
Petitioners later moved for the dismissal of the declaratory relief case for being an
improper remedy considering that respondent was already in breach of the
obligation and that the case would not end the litigation and settle the rights of the
parties. The trial court, however, was not persuaded, and consequently, denied the
motion.
After trial on the merits, on May 9, 2000, the RTC ruled in favor of respondent and
against petitioners. The pertinent portion of the decision reads:
WHEREFORE, premises considered, this Court renders judgment on the
case as follows:
1) declaring that plaintiff is not liable for the payment of Value-Added Tax
(VAT) of 10% of the rent for [the] use of the leased premises;
2) declaring that plaintiff is not liable for the payment of any rental
adjustment, there being no [extraordinary] inflation or devaluation, as
provided in the Seventh Condition of the lease contract, to justify the
same;
3) holding defendants liable to plaintiff for the total amount
of P1,119,102.19, said amount representing payments erroneously made
by plaintiff as VAT charges and rental adjustment for the months of
January, February and March, 1999; and
4) holding defendants liable to plaintiff for the amount of P1,107,348.69,
said amount representing the balance of plaintiff's rental deposit still with
defendants.
SO ORDERED.13
The trial court denied petitioners their right to pass on to respondent the burden of
paying the VAT since it was not a new tax that would call for the application of the
sixth clause of the contract. The court, likewise, denied their right to collect the
demanded increase in rental, there being no extraordinary inflation or devaluation
as provided for in the seventh clause of the contract. Because of the payment
made by respondent of the rental adjustment demanded by petitioners, the court
ordered the restitution by the latter to the former of the amounts paid,
notwithstanding the well-established rule that in an action for declaratory relief,
other than a declaration of rights and obligations, affirmative reliefs are not sought
by or awarded to the parties.
Petitioners elevated the aforesaid case to the Court of Appeals which affirmed with
modification the RTC decision. The fallo reads:
WHEREFORE, premises considered, the present appeal is DISMISSED
and the appealed decision in Civil Case No. 98-411 is hereby AFFIRMED
with MODIFICATION in that the order for the return of the balance of the
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 rental deposits and of the amounts representing the 10% VAT and rental
adjustment, is hereby DELETED.
No pronouncement as to costs.
SO ORDERED.14
The appellate court agreed with the conclusions of law and the application of the
decisional rules on the matter made by the RTC. However, it found that the trial
court exceeded its jurisdiction in granting affirmative relief to the respondent,
particularly the restitution of its excess payment.
Petitioners now come before this Court raising the following issues:
I.
WHETHER OR NOT ARTICLE 1250 OF THE NEW CIVIL CODE IS
APPLICABLE TO THE CASE AT BAR.
II.
WHETHER OR NOT THE DOCTRINE ENUNCIATED IN FILIPINO PIPE
AND FOUNDRY CORP. VS. NAWASA CASE, 161 SCRA 32 AND
COMPANION CASES ARE (sic) APPLICABLE IN THE CASE AT BAR.
III.
WHETHER OR NOT IN NOT APPLYING THE DOCTRINE IN THE CASE
OF DEL ROSARIO VS. THE SHELL COMPANY OF THE PHILIPPINES,
164 SCRA 562, THE HONORABLE COURT OF APPEALS SERIOUSLY
ERRED ON A QUESTION OF LAW.
IV.
WHETHER OR NOT THE FINDING OF THE HONORABLE COURT OF
APPEALS THAT RESPONDENT IS NOT LIABLE TO PAY THE 10%
VALUE ADDED TAX IS IN ACCORDANCE WITH THE MANDATE OF RA
7716.
V.
WHETHER OR NOT DECLARATORY RELIEF IS PROPER SINCE
PLAINTIFF-APPELLEE WAS IN BREACH WHEN THE PETITION FOR
DECLARATORY RELIEF WAS FILED BEFORE THE TRIAL COURT.
In fine, the issues for our resolution are as follows: 1) whether the action for
declaratory relief is proper; 2) whether respondent is liable to pay 10% VAT
pursuant to Republic Act (RA) 7716; and 3) whether the amount of rentals due the
petitioners should be adjusted by reason of extraordinary inflation or devaluation.
Declaratory relief is defined as an action by any person interested in a deed, will,
contract or other written instrument, executive order or resolution, to determine any
question of construction or validity arising from the instrument, executive order or
regulation, or statute, and for a declaration of his rights and duties thereunder. The
only issue that may be raised in such a petition is the question of construction or
validity of provisions in an instrument or statute. Corollary is the general rule that
such an action must be justified, as no other adequate relief or remedy is available
under the circumstances. 15
Decisional law enumerates the requisites of an action for declaratory relief, as
follows: 1) the subject matter of the controversy must be a deed, will, contract or
other written instrument, statute, executive order or regulation, or ordinance; 2) the
terms of said documents and the validity thereof are doubtful and require judicial
construction; 3) there must have been no breach of the documents in question; 4)
there must be an actual justiciable controversy or the "ripening seeds" of one
between persons whose interests are adverse; 5) the issue must be ripe for judicial
determination; and 6) adequate relief is not available through other means or other
forms of action or proceeding.16
It is beyond cavil that the foregoing requisites are present in the instant case,
except that petitioners insist that respondent was already in breach of the contract
when the petition was filed.
We do not agree.
After petitioners demanded payment of adjusted rentals and in the months that
followed, respondent complied with the terms and conditions set forth in their
contract of lease by paying the rentals stipulated therein. Respondent religiously
fulfilled its obligations to petitioners even during the pendency of the present suit.
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There is no showing that respondent committed an act constituting a breach of the
subject contract of lease. Thus, respondent is not barred from instituting before the
trial court the petition for declaratory relief.
Petitioners claim that the instant petition is not proper because a separate action
for rescission, ejectment and damages had been commenced before another
court; thus, the construction of the subject contractual provisions should be
ventilated in the same forum.
We are not convinced.
It is true that in Panganiban v. Pilipinas Shell Petroleum Corporation17 we held that
the petition for declaratory relief should be dismissed in view of the pendency of a
separate action for unlawful detainer. However, we cannot apply the same ruling to
the instant case. In Panganiban, the unlawful detainer case had already been
resolved by the trial court before the dismissal of the declaratory relief case; and it
was petitioner in that case who insisted that the action for declaratory relief be
preferred over the action for unlawful detainer. Conversely, in the case at bench,
the trial court had not yet resolved the rescission/ejectment case during the
pendency of the declaratory relief petition. In fact, the trial court, where the
rescission case was on appeal, itself initiated the suspension of the proceedings
pending the resolution of the action for declaratory relief.
We are not unmindful of the doctrine enunciated in Teodoro, Jr. v. Mirasol18 where
the declaratory relief action was dismissed because the issue therein could be
threshed out in the unlawful detainer suit. Yet, again, in that case, there was
already a breach of contract at the time of the filing of the declaratory relief petition.
This dissimilar factual milieu proscribes the Court from applying Teodoro to the
instant case.
Given all these attendant circumstances, the Court is disposed to entertain the
instant declaratory relief action instead of dismissing it, notwithstanding the
pendency of the ejectment/rescission case before the trial court. The resolution of
the present petition would write finis to the parties' dispute, as it would settle once
and for all the question of the proper interpretation of the two contractual
stipulations subject of this controversy.
Now, on the substantive law issues.
Petitioners repeatedly made a demand on respondent for the payment of VAT and
for rental adjustment allegedly brought about by extraordinary inflation or
devaluation. Both the trial court and the appellate court found no merit in
petitioners' claim. We see no reason to depart from such findings.
As to the liability of respondent for the payment of VAT, we cite with approval the
ratiocination of the appellate court, viz.:
Clearly, the person primarily liable for the payment of VAT is the lessor
who may choose to pass it on to the lessee or absorb the same. Beginning
January 1, 1996, the lease of real property in the ordinary course of
business, whether for commercial or residential use, when the gross
annual receipts exceed P500,000.00, is subject to 10% VAT.
Notwithstanding the mandatory payment of the 10% VAT by the lessor, the
actual shifting of the said tax burden upon the lessee is clearly optional on
the part of the lessor, under the terms of the statute. The word "may" in the
statute, generally speaking, denotes that it is directory in nature. It is
generally permissive only and operates to confer discretion. In this case,
despite the applicability of the rule under Sec. 99 of the NIRC, as
amended by R.A. 7716, granting the lessor the option to pass on to the
lessee the 10% VAT, to existing contracts of lease as of January 1, 1996,
the original lessor, Ponciano L. Almeda did not charge the lessee-appellee
the 10% VAT nor provided for its additional imposition when they renewed
the contract of lease in May 1997. More significantly, said lessor did not
actually collect a 10% VAT on the monthly rental due from the lessee-
appellee after the execution of the May 1997 contract of lease. The
inevitable implication is that the lessor intended not to avail of the option
granted him by law to shift the 10% VAT upon the lessee-appellee. x x x.19
In short, petitioners are estopped from shifting to respondent the burden of paying
the VAT.
Petitioners' reliance on the sixth condition of the contract is, likewise, unavailing.
This provision clearly states that respondent can only be held liable for new
taxes imposed after the effectivity of the contract of lease, that is, after May 1997,
and only if they pertain to the lot and the building where the leased premises are
located. Considering that RA 7716 took effect in 1994, the VAT cannot be
considered as a "new tax" in May 1997, as to fall within the coverage of the sixth
stipulation.
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Neither can petitioners legitimately demand rental adjustment because of
extraordinary inflation or devaluation.
Petitioners contend that Article 1250 of the Civil Code does not apply to this case
because the contract stipulation speaks of extraordinary inflation or devaluation
while the Code speaks of extraordinary inflation or deflation. They insist that the
doctrine pronounced in Del Rosario v. The Shell Company, Phils. Limited20 should
apply.
Essential to contract construction is the ascertainment of the intention of the
contracting parties, and such determination must take into account the
contemporaneous and subsequent acts of the parties. This intention, once
ascertained, is deemed an integral part of the contract. 21
While, indeed, condition No. 7 of the contract speaks of "extraordinary inflation or
devaluation" as compared to Article 1250's "extraordinary inflation or deflation," we
find that when the parties used the term "devaluation," they really did not intend to
depart from Article 1250 of the Civil Code. Condition No. 7 of the contract should,
thus, be read in harmony with the Civil Code provision.
letter 22
That this is the intention of the parties is evident from petitioners' dated
January 26, 1998, where, in demanding rental adjustment ostensibly based on
condition No. 7, petitioners made explicit reference to Article 1250 of the Civil
Code, even quoting the law verbatim. Thus, the application of Del Rosario is not
warranted. Rather, jurisprudential rules on the application of Article 1250 should be
considered.
Article 1250 of the Civil Code states:
In case an extraordinary inflation or deflation of the currency stipulated
should supervene, the value of the currency at the time of the
establishment of the obligation shall be the basis of payment, unless there
is an agreement to the contrary.
Inflation has been defined as the sharp increase of money or credit, or both,
without a corresponding increase in business transaction. There is inflation when
there is an increase in the volume of money and credit relative to available goods,
resulting in a substantial and continuing rise in the general price level. 23 In a
number of cases, this Court had provided a discourse on what constitutes
extraordinary inflation, thus:
[E]xtraordinary inflation exists when there is a decrease or increase in the
purchasing power of the Philippine currency which is unusual or beyond
the common fluctuation in the value of said currency, and such increase or
decrease could not have been reasonably foreseen or was manifestly
beyond the contemplation of the parties at the time of the establishment of
the obligation.24
The factual circumstances obtaining in the present case do not make out a case of
extraordinary inflation or devaluation as would justify the application of Article 1250
of the Civil Code. We would like to stress that the erosion of the value of the
Philippine peso in the past three or four decades, starting in the mid-sixties, is
characteristic of most currencies. And while the Court may take judicial notice of
the decline in the purchasing power of the Philippine currency in that span of time,
such downward trend of the peso cannot be considered as the extraordinary
phenomenon contemplated by Article 1250 of the Civil Code. Furthermore, absent
an official pronouncement or declaration by competent authorities of the existence
of extraordinary inflation during a given period, the effects of extraordinary inflation
are not to be applied. 25
WHEREFORE, premises considered, the petition is DENIED. The Decision of the
Court of Appeals in CA-G.R. CV No. 67784, dated September 3, 2001, and its
Resolution dated November 19, 2001, are AFFIRMED.
SO ORDERED.
G.R. No. 154380 October 5, 2005
REPUBLIC OF THE PHILIPPINES, Petitioner,
vs.
CIPRIANO ORBECIDO III, Respondent.
DECISION
QUISUMBING, J.:
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Given a valid marriage between two Filipino citizens, where one party is later
naturalized as a foreign citizen and obtains a valid divorce decree capacitating him
or her to remarry, can the Filipino spouse likewise remarry under Philippine law?
Before us is a case of first impression that behooves the Court to make a definite
ruling on this apparently novel question, presented as a pure question of law.
In this petition for review, the Solicitor General assails the Decision1 dated May
15, 2002, of the Regional Trial Court of Molave, Zamboanga del Sur, Branch 23
and its Resolution2 dated July 4, 2002 denying the motion for reconsideration.
The court a quo had declared that herein respondent Cipriano Orbecido III is
capacitated to remarry. The fallo of the impugned Decision reads:
WHEREFORE, by virtue of the provision of the second paragraph of Art. 26 of the
Family Code and by reason of the divorce decree obtained against him by his
American wife, the petitioner is given the capacity to remarry under the Philippine
Law.
IT IS SO ORDERED.3
The factual antecedents, as narrated by the trial court, are as follows.
On May 24, 1981, Cipriano Orbecido III married Lady Myros M. Villanueva at the
United Church of Christ in the Philippines in Lam-an, Ozamis City. Their marriage
was blessed with a son and a daughter, Kristoffer Simbortriz V. Orbecido and Lady
Kimberly V. Orbecido.
In 1986, Cipriano’s wife left for the United States bringing along their son Kristoffer.
A few years later, Cipriano discovered that his wife had been naturalized as an
American citizen.
Sometime in 2000, Cipriano learned from his son that his wife had obtained a
divorce decree and then married a certain Innocent Stanley. She, Stanley and her
child by him currently live at 5566 A. Walnut Grove Avenue, San Gabriel,
California.
Cipriano thereafter filed with the trial court a petition for authority to remarry
invoking Paragraph 2 of Article 26 of the Family Code. No opposition was filed.
Finding merit in the petition, the court granted the same. The Republic, herein
petitioner, through the Office of the Solicitor General (OSG), sought
reconsideration but it was denied.
In this petition, the OSG raises a pure question of law:
WHETHER OR NOT RESPONDENT CAN REMARRY UNDER ARTICLE 26 OF
THE FAMILY CODE4
The OSG contends that Paragraph 2 of Article 26 of the Family Code is not
applicable to the instant case because it only applies to a valid mixed marriage;
that is, a marriage celebrated between a Filipino citizen and an alien. The proper
remedy, according to the OSG, is to file a petition for annulment or for legal
separation.5 Furthermore, the OSG argues there is no law that governs
respondent’s situation. The OSG posits that this is a matter of legislation and not of
judicial determination.6
For his part, respondent admits that Article 26 is not directly applicable to his case
but insists that when his naturalized alien wife obtained a divorce decree which
capacitated her to remarry, he is likewise capacitated by operation of law pursuant
to Section 12, Article II of the Constitution.7
At the outset, we note that the petition for authority to remarry filed before the trial
court actually constituted a petition for declaratory relief. In this connection, Section
1, Rule 63 of the Rules of Court provides:
RULE 63
DECLARATORY RELIEF AND SIMILAR REMEDIES
Section 1. Who may file petition—Any person interested under a deed, will,
contract or other written instrument, or whose rights are affected by a statute,
executive order or regulation, ordinance, or other governmental regulation may,
before breach or violation thereof, bring an action in the appropriate Regional Trial
Court to determine any question of construction or validity arising, and for a
declaration of his rights or duties, thereunder.
...
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The requisites of a petition for declaratory relief are: (1) there must be a justiciable
controversy; (2) the controversy must be between persons whose interests are
adverse; (3) that the party seeking the relief has a legal interest in the controversy;
and (4) that the issue is ripe for judicial determination. 8
This case concerns the applicability of Paragraph 2 of Article 26 to a marriage
between two Filipino citizens where one later acquired alien citizenship, obtained a
divorce decree, and remarried while in the U.S.A. The interests of the parties are
also adverse, as petitioner representing the State asserts its duty to protect the
institution of marriage while respondent, a private citizen, insists on a declaration
of his capacity to remarry. Respondent, praying for relief, has legal interest in the
controversy. The issue raised is also ripe for judicial determination inasmuch as
when respondent remarries, litigation ensues and puts into question the validity of
his second marriage.
Coming now to the substantive issue, does Paragraph 2 of Article 26 of the Family
Code apply to the case of respondent? Necessarily, we must dwell on how this
provision had come about in the first place, and what was the intent of the
legislators in its enactment?
Brief Historical Background
On July 6, 1987, then President Corazon Aquino signed into law Executive Order
No. 209, otherwise known as the "Family Code," which took effect on August 3,
1988. Article 26 thereof states:
All marriages solemnized outside the Philippines in accordance with the laws in
force in the country where they were solemnized, and valid there as such, shall
also be valid in this country, except those prohibited under Articles 35, 37, and 38.
On July 17, 1987, shortly after the signing of the original Family Code, Executive
Order No. 227 was likewise signed into law, amending Articles 26, 36, and 39 of
the Family Code. A second paragraph was added to Article 26. As so amended, it
now provides:
ART. 26. All marriages solemnized outside the Philippines in accordance with the
laws in force in the country where they were solemnized, and valid there as such,
shall also be valid in this country, except those prohibited under Articles 35(1), (4),
(5) and (6), 36, 37 and 38.
Where a marriage between a Filipino citizen and a foreigner is validly celebrated
and a divorce is thereafter validly obtained abroad by the alien spouse capacitating
him or her to remarry, the Filipino spouse shall have capacity to remarry under
Philippine law. (Emphasis supplied)
On its face, the foregoing provision does not appear to govern the situation
presented by the case at hand. It seems to apply only to cases where at the time
of the celebration of the marriage, the parties are a Filipino citizen and a foreigner.
The instant case is one where at the time the marriage was solemnized, the
parties were two Filipino citizens, but later on, the wife was naturalized as an
American citizen and subsequently obtained a divorce granting her capacity to
remarry, and indeed she remarried an American citizen while residing in the U.S.A.
Noteworthy, in the Report of the Public Hearings9 on the Family Code, the Catholic
Bishops’ Conference of the Philippines (CBCP) registered the following objections
to Paragraph 2 of Article 26:
1. The rule is discriminatory. It discriminates against those whose spouses are
Filipinos who divorce them abroad. These spouses who are divorced will not be
able to re-marry, while the spouses of foreigners who validly divorce them abroad
can.
2. This is the beginning of the recognition of the validity of divorce even for Filipino
citizens. For those whose foreign spouses validly divorce them abroad will also be
considered to be validly divorced here and can re-marry. We propose that this be
deleted and made into law only after more widespread consultation. (Emphasis
supplied.)
Legislative Intent
Records of the proceedings of the Family Code deliberations showed that the
intent of Paragraph 2 of Article 26, according to Judge Alicia Sempio-Diy, a
member of the Civil Code Revision Committee, is to avoid the absurd situation
where the Filipino spouse remains married to the alien spouse who, after obtaining
a divorce, is no longer married to the Filipino spouse.
Interestingly, Paragraph 2 of Article 26 traces its origin to the 1985 case of Van
Dorn v. Romillo, Jr.10 The Van Dorn case involved a marriage between a Filipino
citizen and a foreigner. The Court held therein that a divorce decree validly
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obtained by the alien spouse is valid in the Philippines, and consequently, the
Filipino spouse is capacitated to remarry under Philippine law.
Does the same principle apply to a case where at the time of the celebration of the
marriage, the parties were Filipino citizens, but later on, one of them obtains a
foreign citizenship by naturalization?
The jurisprudential answer lies latent in the 1998 case of Quita v. Court of
Appeals.11 In Quita, the parties were, as in this case, Filipino citizens when they
got married. The wife became a naturalized American citizen in 1954 and obtained
a divorce in the same year. The Court therein hinted, by way of obiter dictum, that
a Filipino divorced by his naturalized foreign spouse is no longer married under
Philippine law and can thus remarry.
Thus, taking into consideration the legislative intent and applying the rule of
reason, we hold that Paragraph 2 of Article 26 should be interpreted to include
cases involving parties who, at the time of the celebration of the marriage were
Filipino citizens, but later on, one of them becomes naturalized as a foreign citizen
and obtains a divorce decree. The Filipino spouse should likewise be allowed to
remarry as if the other party were a foreigner at the time of the solemnization of the
marriage. To rule otherwise would be to sanction absurdity and injustice. Where
the interpretation of a statute according to its exact and literal import would lead to
mischievous results or contravene the clear purpose of the legislature, it should be
construed according to its spirit and reason, disregarding as far as necessary the
letter of the law. A statute may therefore be extended to cases not within the literal
meaning of its terms, so long as they come within its spirit or intent. 12
If we are to give meaning to the legislative intent to avoid the absurd situation
where the Filipino spouse remains married to the alien spouse who, after obtaining
a divorce is no longer married to the Filipino spouse, then the instant case must be
deemed as coming within the contemplation of Paragraph 2 of Article 26.
In view of the foregoing, we state the twin elements for the application of
Paragraph 2 of Article 26 as follows:
1. There is a valid marriage that has been celebrated between a Filipino citizen
and a foreigner; and
2. A valid divorce is obtained abroad by the alien spouse capacitating him or her to
remarry.
The reckoning point is not the citizenship of the parties at the time of the
celebration of the marriage, but their citizenship at the time a valid divorce is
obtained abroad by the alien spouse capacitating the latter to remarry.
In this case, when Cipriano’s wife was naturalized as an American citizen, there
was still a valid marriage that has been celebrated between her and Cipriano. As
fate would have it, the naturalized alien wife subsequently obtained a valid divorce
capacitating her to remarry. Clearly, the twin requisites for the application of
Paragraph 2 of Article 26 are both present in this case. Thus Cipriano, the
"divorced" Filipino spouse, should be allowed to remarry.
We are also unable to sustain the OSG’s theory that the proper remedy of the
Filipino spouse is to file either a petition for annulment or a petition for legal
separation. Annulment would be a long and tedious process, and in this particular
case, not even feasible, considering that the marriage of the parties appears to
have all the badges of validity. On the other hand, legal separation would not be a
sufficient remedy for it would not sever the marriage tie; hence, the legally
separated Filipino spouse would still remain married to the naturalized alien
spouse.
However, we note that the records are bereft of competent evidence duly
submitted by respondent concerning the divorce decree and the naturalization of
respondent’s wife. It is settled rule that one who alleges a fact has the burden of
proving it and mere allegation is not evidence.13
Accordingly, for his plea to prosper, respondent herein must prove his allegation
that his wife was naturalized as an American citizen. Likewise, before a foreign
divorce decree can be recognized by our own courts, the party pleading it must
prove the divorce as a fact and demonstrate its conformity to the foreign law
allowing it.14 Such foreign law must also be proved as our courts cannot take
judicial notice of foreign laws. Like any other fact, such laws must be alleged and
proved.15 Furthermore, respondent must also show that the divorce decree allows
his former wife to remarry as specifically required in Article 26. Otherwise, there
would be no evidence sufficient to declare that he is capacitated to enter into
another marriage.
Nevertheless, we are unanimous in our holding that Paragraph 2 of Article 26 of
the Family Code (E.O. No. 209, as amended by E.O. No. 227), should be
interpreted to allow a Filipino citizen, who has been divorced by a spouse who had
acquired foreign citizenship and remarried, also to remarry. However, considering
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that in the present petition there is no sufficient evidence submitted and on record,
we are unable to declare, based on respondent’s bare allegations that his wife,
who was naturalized as an American citizen, had obtained a divorce decree and
had remarried an American, that respondent is now capacitated to remarry. Such
declaration could only be made properly upon respondent’s submission of the
aforecited evidence in his favor.
ACCORDINGLY, the petition by the Republic of the Philippines is GRANTED. The
assailed Decision dated May 15, 2002, and Resolution dated July 4, 2002, of the
Regional Trial Court of Molave, Zamboanga del Sur, Branch 23, are hereby SET
ASIDE.
No pronouncement as to costs.
SO ORDERED.
[G.R. NO. 181303 : September 17, 2009]
CARMEN DANAO MALANA, MARIA DANAO ACORDA, EVELYN DANAO,
FERMINA DANAO, LETICIA DANAO and LEONORA DANAO, the last two are
represented herein by their Attorney-in-Fact, MARIA DANAO
ACORDA, Petitioners, v. BENIGNO TAPPA, JERRY REYNA, SATURNINO
CAMBRI and SPOUSES FRANCISCO AND MARIA LIGUTAN, Respondents.
DECISION
CHICO-NAZARIO, J.:
This is a Petition for Certiorari under Rule 65 of the Rules of Court, assailing the
Orders1 dated 4 May 2007, 30 May 2007, and 31 October 2007, rendered by
Branch 3 of the Regional Trial Court (RTC) of Tuguegarao City, which dismissed,
for lack of jurisdiction, the Complaint of petitioners Carmen Danao Malana, Leticia
Danao, Maria Danao Accorda, Evelyn Danao, Fermina Danao, and Leonora
Danao, against respondents Benigno Tappa, Jerry Reyna, Saturnino Cambri,
Francisco Ligutan and Maria Ligutan, in Civil Case No. 6868.
Petitioners filed before the RTC their Complaint for Reivindicacion, Quieting of
Title, and Damages2against respondents on 27 March 2007, docketed as Civil
Case No. 6868. Petitioners alleged in their Complaint that they are the owners of a
parcel of land covered by Transfer Certificate of Title (TCT) No. T-1279373 situated
in Tuguegarao City, Cagayan (subject property). Petitioners inherited the subject
property from Anastacio Danao (Anastacio), who died intestate.4 During the
lifetime of Anastacio, he had allowed Consuelo Pauig (Consuelo), who was
married to Joaquin Boncad, to build on and occupy the southern portion of the
subject property. Anastacio and Consuelo agreed that the latter would vacate the
said land at any time that Anastacio and his heirs might need it.5
Petitioners claimed that respondents, Consuelo's family members,6 continued to
occupy the subject property even after her death, already building their residences
thereon using permanent materials. Petitioners also learned that respondents were
claiming ownership over the subject property. Averring that they already needed it,
petitioners demanded that respondents vacate the same. Respondents, however,
refused to heed petitioners' demand.7
Petitioners referred their land dispute with respondents to the Lupong
Tagapamayapa of Barangay Annafunan West for conciliation. During the
conciliation proceedings, respondents asserted that they owned the subject
property and presented documents ostensibly supporting their claim of ownership.
According to petitioners, respondents' documents were highly dubious, falsified,
and incapable of proving the latter's claim of ownership over the subject property;
nevertheless, they created a cloud upon petitioners' title to the property. Thus,
petitioners were compelled to file before the RTC a Complaint to remove such
cloud from their title.8 Petitioners additionally sought in their Complaint an award
against respondents for actual damages, in the amount of P50,000.00, resulting
from the latter's baseless claim over the subject property that did not actually
belong to them, in violation of Article 19 of the Civil Code on Human
Relations.9 Petitioners likewise prayed for an award against respondents for
exemplary damages, in the amount of P50,000.00, since the latter had acted in
bad faith and resorted to unlawful means to establish their claim over the subject
property. Finally, petitioners asked to recover from respondents P50,000.00 as
attorney's fees, because the latter's refusal to vacate the property constrained
petitioners to engage the services of a lawyer.10
Before respondents could file their answer, the RTC issued an Order dated 4 May
2007 dismissing petitioners' Complaint on the ground of lack of jurisdiction. The
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RTC referred to Republic Act No. 7691,11amending Batas Pambansa Blg. 129,
otherwise known as the Judiciary Reorganization Act of 1980, which vests the
RTC with jurisdiction over real actions, where the assessed value of the property
involved exceeds P20,000.00. It found that the subject property had a value of less
than P20,000.00; hence, petitioners' action to recover the same was outside the
jurisdiction of the RTC. The RTC decreed in its 4 May 2007 Order that:
The Court has no jurisdiction over the action, it being a real action involving a real
property with assessed value less than P20,000.00 and hereby dismisses the
same without prejudice.12
Petitioners filed a Motion for Reconsideration of the aforementioned RTC Order
dismissing their Complaint. They argued that their principal cause of action was for
quieting of title; the accion reivindicacion was included merely to enable them to
seek complete relief from respondents. Petitioner's Complaint should not have
been dismissed, since Section 1, Rule 63 of the Rules of Court 13 states that an
action to quiet title falls under the jurisdiction of the RTC.14
In an Order dated 30 May 2007, the RTC denied petitioners' Motion for
Reconsideration. It reasoned that an action to quiet title is a real action. Pursuant
to Republic Act No. 7691, it is the Municipal Trial Court (MTC) that exercises
exclusive jurisdiction over real actions where the assessed value of real property
does not exceed P20,000.00. Since the assessed value of subject property per
Tax Declaration No, 02-48386 was P410.00, the real action involving the same
was outside the jurisdiction of the RTC.15
Petitioners filed another pleading, simply designated as Motion, in which they
prayed that the RTC Orders dated 4 May 2007 and 30 May 2007, dismissing their
Complaint, be set aside. They reiterated their earlier argument that Section 1, Rule
63 of the Rules of Court states that an action to quiet title falls under the exclusive
jurisdiction of the RTC. They also contended that there was no obstacle to their
joining the two causes of action, i.e., quieting of title and reivindicacion, in a single
Complaint, citing Rumarate v. Hernandez.16 And even if the two causes of action
could not be joined, petitioners maintained that the misjoinder of said causes of
action was not a ground for the dismissal of their Complaint. 17
The RTC issued an Order dated 31 October 2007 denying petitioners' Motion. It
clarified that their Complaint was dismissed, not on the ground of misjoinder of
causes of action, but for lack of jurisdiction. The RTC dissected Section 1, Rule 63
of the Rules of Court, which provides:
Section 1. Who may file petition. Any person interested under a deed, will, contract
or other written instrument, or whose rights are affected by a statute, executive
order or regulation, ordinance, or any other governmental regulation may, before
breach or violation thereof, bring an action in the appropriate Regional Trial Court
to determine any question of construction or validity arising, and for a declaration
of his rights or duties, thereunder.
An action for the reformation of an instrument, to quiet title to real property or
remove clouds therefrom, or to consolidate ownership under Article 1607 of the
Civil Code, may be brought under this Rule.
The RTC differentiated between the first and the second paragraphs of Section 1,
Rule 63 of the Rules of Court. The first paragraph refers to an action for
declaratory relief, which should be brought before the RTC. The second
paragraph, however, refers to a different set of remedies, which includes an action
to quiet title to real property. The second paragraph must be read in relation to
Republic Act No. 7691, which vests the MTC with jurisdiction over real actions,
where the assessed value of the real property involved does not
exceed P50,000.00 in Metro Manila and P20,000.00 in all other places.18 The
dispositive part of the 31 October 2007 Order of the RTC reads:
This Court maintains that an action to quiet title is a real action. [Herein petitioners]
do not dispute the assessed value of the property at P410.00 under Tax
Declaration No. 02-48386. Hence, it has no jurisdiction over the action.
In view of the foregoing considerations, the Motion is hereby denied.19
Hence, the present Petition, where petitioners raise the sole issue of:
I
WHETHER OR NOT THE RESPONDENT JUDGE COMMITTED GRAVE ABUSE
OF DISCRETION IN DISMISSING THE COMPLAINT OF THE PETITIONERS
MOTU PROPRIO.20
Petitioners' statement of the issue is misleading. It would seem that they are only
challenging the fact that their Complaint was dismissed by the RTC motu proprio.
Based on the facts and arguments set forth in the instant Petition, however, the
Court determines that the fundamental issue for its resolution is whether the RTC
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committed grave abuse of discretion in dismissing petitioners' Complaint for lack of
jurisdiction.
The Court rules in the negative.
An action for declaratory relief should be filed by a person interested under a deed,
a will, a contract or other written instrument, and whose rights are affected by a
statute, an executive order, a regulation or an ordinance. The relief sought under
this remedy includes the interpretation and determination of the validity of the
written instrument and the judicial declaration of the parties' rights or duties
thereunder.21
Petitions for declaratory relief are governed by Rule 63 of the Rules of Court. The
RTC correctly made a distinction between the first and the second paragraphs of
Section 1, Rule 63 of the Rules of Court.
The first paragraph of Section 1, Rule 63 of the Rules of Court, describes the
general circumstances in which a person may file a petition for declaratory relief, to
wit:
Any person interested under a deed, will, contract or other written instrument, or
whose rights are affected by a statute, executive order or regulation, ordinance, or
any other governmental regulation may, before breach or violation thereof, bring
an action in the appropriate Regional Trial Court to determine any question of
construction or validity arising, and for a declaration of his rights or duties,
thereunder. (Emphasis ours.)
As the afore-quoted provision states, a petition for declaratory relief under the first
paragraph of Section 1, Rule 63 may be brought before the appropriate RTC.
Section 1, Rule 63 of the Rules of Court further provides in its second paragraph
that:
An action for the reformation of an instrument, to quiet title to real property or
remove clouds therefrom, or to consolidate ownership under Article 1607 of the
Civil Code, may be brought under this Rule. (Emphasis ours.)
The second paragraph of Section 1, Rule 63 of the Rules of Court specifically
refers to (1) an action for the reformation of an instrument, recognized under
Articles 1359 to 1369 of the Civil Code; (2) an action to quiet title, authorized by
Articles 476 to 481 of the Civil Code; and (3) an action to consolidate ownership
required by Article 1607 of the Civil Code in a sale with a right to repurchase.
These three remedies are considered similar to declaratory relief because they
also result in the adjudication of the legal rights of the litigants, often without the
need of execution to carry the judgment into effect.22
To determine which court has jurisdiction over the actions identified in the second
paragraph of Section 1, Rule 63 of the Rules of Court, said provision must be read
together with those of the Judiciary Reorganization Act of 1980, as amended.
It is important to note that Section 1, Rule 63 of the Rules of Court does not
categorically require that an action to quiet title be filed before the RTC. It
repeatedly uses the word "may" - that an action for quieting of title "may be
brought under [the] Rule" on petitions for declaratory relief, and a person desiring
to file a petition for declaratory relief "may x x x bring an action in the appropriate
Regional Trial Court." The use of the word "may" in a statute denotes that the
provision is merely permissive and indicates a mere possibility, an opportunity or
an option.23
In contrast, the mandatory provision of the Judiciary Reorganization Act of 1980,
as amended, uses the word "shall" and explicitly requires the MTC to exercise
exclusive original jurisdiction over all civil actions which involve title to or
possession of real property where the assessed value does not
exceed P20,000.00, thus:
Section 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and
Municipal Circuit Trial Courts in Civil Cases. Metropolitan Trial Courts, Municipal
Trial Courts and Municipal Circuit Trial Courts shall exercise:
xxx
(3) Exclusive original jurisdiction in all civil actions which involve title to, possession
of, real property, or any interest therein where the assessed value of the property
or interest therein does not exceed Twenty thousand pesos (P20,000.00) or, in
civil actions in Metro Manila, where such assessed value does not exceeds Fifty
thousand pesos (P50,000.00) exclusive of interest, damages of whatever kind,
attorney's fees, litigation expenses and costs: x x x (Emphasis ours.)
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As found by the RTC, the assessed value of the subject property as stated in Tax
Declaration No. 02-48386 is only P410.00; therefore, petitioners' Complaint
involving title to and possession of the said property is within the exclusive original
jurisdiction of the MTC, not the RTC.
Furthermore, an action for declaratory relief presupposes that there has been no
actual breach of the instruments involved or of rights arising thereunder. 24 Since
the purpose of an action for declaratory relief is to secure an authoritative
statement of the rights and obligations of the parties under a statute, deed, or
contract for their guidance in the enforcement thereof, or compliance therewith,
and not to settle issues arising from an alleged breach thereof, it may be
entertained only before the breach or violation of the statute, deed, or contract to
which it refers. A petition for declaratory relief gives a practical remedy for ending
controversies that have not reached the state where another relief is immediately
available; and supplies the need for a form of action that will set controversies at
rest before they lead to a repudiation of obligations, an invasion of rights, and a
commission of wrongs.25
Where the law or contract has already been contravened prior to the filing of an
action for declaratory relief, the courts can no longer assume jurisdiction over the
action. In other words, a court has no more jurisdiction over an action for
declaratory relief if its subject has already been infringed or transgressed before
the institution of the action.26
In the present case, petitioners' Complaint for quieting of title was filed after
petitioners already demanded and respondents refused to vacate the subject
property. In fact, said Complaint was filed only subsequent to the latter's express
claim of ownership over the subject property before the Lupong Tagapamayapa, in
direct challenge to petitioners' title.
Since petitioners averred in the Complaint that they had already been deprived of
the possession of their property, the proper remedy for them is the filing of an
accion publiciana or an accion reivindicatoria, not a case for declaratory relief. An
accion publiciana is a suit for the recovery of possession, filed one year after the
occurrence of the cause of action or from the unlawful withholding of possession of
the realty. An accion reivindicatoria is a suit that has for its object one's recovery of
possession over the real property as
owner.27 ςηαñrοblεš νιr†υαl lαω lιbrαrÿ
Petitioners' Complaint contained sufficient allegations for an accion reivindicatoria.
Jurisdiction over such an action would depend on the value of the property
involved. Given that the subject property herein is valued only at P410.00, then the
MTC, not the RTC, has jurisdiction over an action to recover the same. The RTC,
therefore, did not commit grave abuse of discretion in dismissing, without
prejudice, petitioners' Complaint in Civil Case No. 6868 for lack of jurisdiction.
As for the RTC dismissing petitioners' Complaint motu proprio, the following
pronouncements of the Court in Laresma v. Abellana28 proves instructive:
It is axiomatic that the nature of an action and the jurisdiction of a tribunal are
determined by the material allegations of the complaint and the law at the time the
action was commenced. Jurisdiction of the tribunal over the subject matter or
nature of an action is conferred only by law and not by the consent or waiver upon
a court which, otherwise, would have no jurisdiction over the subject matter or
nature of an action. Lack of jurisdiction of the court over an action or the subject
matter of an action cannot be cured by the silence, acquiescence, or even by
express consent of the parties. If the court has no jurisdiction over the nature of an
action, it may dismiss the same ex mero motu or motu proprio. x x x. (Emphasis
supplied.)
Since the RTC, in dismissing petitioners' Complaint, acted in complete accord with
law and jurisprudence, it cannot be said to have done so with grave abuse of
discretion amounting to lack or excess of jurisdiction. An act of a court or tribunal
may only be considered to have been committed in grave abuse of discretion when
the same was performed in a capricious or whimsical exercise of judgment, which
is equivalent to lack of jurisdiction. The abuse of discretion must be so patent and
gross as to amount to an evasion of a positive duty or to a virtual refusal to perform
a duty enjoined by law or to act at all in contemplation of law, as where the power
is exercised in an arbitrary and despotic manner by reason of passion or personal
hostility.29 No such circumstances exist herein as to justify the issuance of a writ
of certiorari.
IN VIEW OF THE FOREGOING, the instant Petition is DISMISSED. The Orders
dated 4 May 2007, 30 May 2007 and 31 October 2007 of the Regional Trial Court
of Tuguegarao City, Branch 3, dismissing the Complaint in Civil Case No. 6868,
without prejudice, are AFFIRMED. The Regional Trial Court is ordered to
REMAND the records of this case to the Municipal Trial Court or the court of
proper jurisdiction for proper disposition. Costs against the petitioners.
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SO ORDERED.
G.R. No. 202242 April 16, 2013
FRANCISCO I. CHAVEZ, Petitioner,
vs.
JUDICIALAND BAR COUNCIL, SEN. FRANCIS JOSEPH G. ESCUDERO and
REP. NIEL C. TUPAS, JR.,Respondents.
RESOLUTION
MENDOZA, J.:
This resolves the Motion for Reconsideration1 filed by the Office of the Solicitor
General (OSG) on behalf of the respondents, Senator Francis Joseph G. Escudero
and Congressman Niel C. Tupas, Jr. (respondents), duly opposed2 by the
petitioner, former Solicitor General Francisco I. Chavez (petitioner).
By way of recapitulation, the present action stemmed from the unexpected
departure of former Chief Justice Renato C. Corona on May 29, 2012, and the
nomination of petitioner, as his potential successor. In his initiatory pleading,
petitioner asked the Court to determine 1] whether the first paragraph of Section 8,
Article VIII of the 1987 Constitution allows more than one (1) member of Congress
to sit in the JBC; and 2] if the practice of having two (2) representatives from each
House of Congress with one (1) vote each is sanctioned by the Constitution.
On July 17, 2012, the Court handed down the assailed subject decision, disposing
the same in the following manner:
WHEREFORE, the petition is GRANTED. The current numerical composition of
the Judicial and Bar Council is declared UNCONSTITUTIONAL. The Judicial and
Bar Council is hereby enjoined to reconstitute itself so that only one (1) member of
Congress will sit as a representative in its proceedings, in accordance with Section
8(1), Article VIII of the 1987 Constitution.
This disposition is immediately executory.
SO ORDERED.
On July 31, 2012, following respondents’ motion for reconsideration and with due
regard to Senate Resolution Nos. 111,3 112,4 113,5 and 114,6 the Court set the
subject motion for oral arguments on August 2, 2012.7 On August 3, 2012, the
Court discussed the merits of the arguments and agreed, in the meantime, to
suspend the effects of the second paragraph of the dispositive portion of the July
17, 2012 Decision which decreed that it was immediately executory. The decretal
portion of the August 3, 2012 Resolution8 reads:
WHEREFORE, the parties are hereby directed to submit their respective
MEMORANDA within ten (10) days from notice. Until further orders, the Court
hereby SUSPENDS the effect of the second paragraph of the dispositive portion of
the Court’s July 17, 2012 Decision, which reads: "This disposition is immediately
executory."9
Pursuant to the same resolution, petitioner and respondents filed their respective
memoranda.10
Brief Statement of the Antecedents
In this disposition, it bears reiterating that from the birth of the Philippine Republic,
the exercise of appointing members of the Judiciary has always been the exclusive
prerogative of the executive and legislative branches of the government. Like their
progenitor of American origins, both the Malolos Constitution 11 and the 1935
Constitution12vested the power to appoint the members of the Judiciary in the
President, subject to confirmation by the Commission on Appointments. It was
during these times that the country became witness to the deplorable practice of
aspirants seeking confirmation of their appointment in the Judiciary to ingratiate
themselves with the members of the legislative body. 13
Then, under the 1973 Constitution,14 with the fusion of the executive and legislative
powers in one body, the appointment of judges and justices ceased to be subject
of scrutiny by another body. The power became exclusive and absolute to the
Executive, subject only to the condition that the appointees must have all the
qualifications and none of the disqualifications.
Prompted by the clamor to rid the process of appointments to the Judiciary of the
evils of political pressure and partisan activities,15 the members of the
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Constitutional Commission saw it wise to create a separate, competent and
independent body to recommend nominees to the President.
Thus, it conceived of a body, representative of all the stakeholders in the judicial
appointment process, and called it the Judicial and Bar Council (JBC). The
Framers carefully worded Section 8, Article VIII of the 1987 Constitution in this
wise:
Section 8. (1) A Judicial and Bar Council is hereby created under the supervision
of the Supreme Court composed of the Chief Justice as ex officio Chairman, the
Secretary of Justice, and a representative of the Congress as ex officio Members,
a representative of the Integrated Bar, a professor of law, a retired Member of the
Supreme Court, and a representative of the private sector.
From the moment of the creation of the JBC, Congress designated one (1)
representative to sit in the JBC to act as one of the ex-officio members.16 Pursuant
to the constitutional provision that Congress is entitled to one (1) representative,
each House sent a representative to the JBC, not together, but alternately or by
rotation.
In 1994, the seven-member composition of the JBC was substantially
altered.1âwphi1 An eighth member was added to the JBC as the two (2)
representatives from Congress began sitting simultaneously in the JBC, with each
having one-half (1/2) of a vote.17
In 2001, the JBC En Banc decided to allow the representatives from the Senate
and the House of Representatives one full vote each. 18 It has been the situation
since then.
Grounds relied upon by Respondents
Through the subject motion, respondents pray that the Court reconsider its
decision and dismiss the petition on the following grounds: 1] that allowing only
one representative from Congress in the JBC would lead to absurdity considering
its bicameral nature; 2] that the failure of the Framers to make the proper
adjustment when there was a shift from unilateralism to bicameralism was a plain
oversight; 3] that two representatives from Congress would not subvert the
intention of the Framers to insulate the JBC from political partisanship; and 4] that
the rationale of the Court in declaring a seven-member composition would provide
a solution should there be a stalemate is not exactly correct.
While the Court may find some sense in the reasoning in amplification of the third
and fourth grounds listed by respondents, still, it finds itself unable to reverse the
assailed decision on the principal issues covered by the first and second grounds
for lack of merit. Significantly, the conclusion arrived at, with respect to the first and
second grounds, carries greater bearing in the final resolution of this case.
As these two issues are interrelated, the Court shall discuss them jointly.
Ruling of the Court
The Constitution evinces the direct action of the Filipino people by which the
fundamental powers of government are established, limited and defined and by
which those powers are distributed among the several departments for their safe
and useful exercise for the benefit of the body politic.19 The Framers reposed their
wisdom and vision on one suprema lex to be the ultimate expression of the
principles and the framework upon which government and society were to operate.
Thus, in the interpretation of the constitutional provisions, the Court firmly relies on
the basic postulate that the Framers mean what they say. The language used in
the Constitution must be taken to have been deliberately chosen for a definite
purpose. Every word employed in the Constitution must be interpreted to exude its
deliberate intent which must be maintained inviolate against disobedience and
defiance. What the Constitution clearly says, according to its text, compels
acceptance and bars modification even by the branch tasked to interpret it.
For this reason, the Court cannot accede to the argument of plain oversight in
order to justify constitutional construction. As stated in the July 17, 2012 Decision,
in opting to use the singular letter "a" to describe "representative of Congress," the
Filipino people through the Framers intended that Congress be entitled to only one
(1) seat in the JBC. Had the intention been otherwise, the Constitution could have,
in no uncertain terms, so provided, as can be read in its other provisions.
A reading of the 1987 Constitution would reveal that several provisions were
indeed adjusted as to be in tune with the shift to bicameralism. One example is
Section 4, Article VII, which provides that a tie in the presidential election shall be
broken "by a majority of all the Members of both Houses of the Congress, voting
separately."20 Another is Section 8 thereof which requires the nominee to replace
the Vice-President to be confirmed "by a majority of all the Members of both
Houses of the Congress, voting separately."21 Similarly, under Section 18, the
proclamation of martial law or the suspension of the privilege of the writ of habeas
corpus may be revoked or continued by the Congress, voting separately, by a vote
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of at least a majority of all its Members."22 In all these provisions, the bicameral
nature of Congress was recognized and, clearly, the corresponding adjustments
were made as to how a matter would be handled and voted upon by its two
Houses.
Thus, to say that the Framers simply failed to adjust Section 8, Article VIII, by
sheer inadvertence, to their decision to shift to a bicameral form of the legislature,
is not persuasive enough. Respondents cannot just lean on plain oversight to
justify a conclusion favorable to them. It is very clear that the Framers were not
keen on adjusting the provision on congressional representation in the JBC
because it was not in the exercise of its primary function – to legislate. JBC was
created to support the executive power to appoint, and Congress, as one whole
body, was merely assigned a contributory non-legislative function.
The underlying reason for such a limited participation can easily be discerned.
Congress has two (2) Houses. The need to recognize the existence and the role of
each House is essential considering that the Constitution employs precise
language in laying down the functions which particular House plays, regardless of
whether the two Houses consummate an official act by voting jointly or separately.
Whether in the exercise of its legislative23 or its non-legislative functions such as
inter alia, the power of appropriation,24 the declaration of an existence of a state of
war,25 canvassing of electoral returns for the President and Vice-President,26 and
impeachment,27 the dichotomy of each House must be acknowledged and
recognized considering the interplay between these two Houses. In all these
instances, each House is constitutionally granted with powers and functions
peculiar to its nature and with keen consideration to 1) its relationship with the
other chamber; and 2) in consonance with the principle of checks and balances, as
to the other branches of government.
In checkered contrast, there is essentially no interaction between the two Houses
in their participation in the JBC. No mechanism is required between the Senate
and the House of Representatives in the screening and nomination of judicial
officers. Rather, in the creation of the JBC, the Framers arrived at a unique system
by adding to the four (4) regular members, three (3) representatives from the major
branches of government - the Chief Justice as ex-officio Chairman (representing
the Judicial Department), the Secretary of Justice (representing the Executive
Department), and a representative of the Congress (representing the Legislative
Department). The total is seven (7), not eight. In so providing, the Framers simply
gave recognition to the Legislature, not because it was in the interest of a certain
constituency, but in reverence to it as a major branch of government.
On this score, a Member of Congress, Hon. Simeon A. Datumanong, from the
Second District of Maguindanao, submitted his well-considered position28 to then
Chief Justice Reynato S. Puno:
I humbly reiterate my position that there should be only one representative of
Congress in the JBC in accordance with Article VIII, Section 8 (1) of the 1987
Constitution x x x.
The aforesaid provision is clear and unambiguous and does not need any further
interpretation. Perhaps, it is apt to mention that the oft-repeated doctrine that
"construction and interpretation come only after it has been demonstrated that
application is impossible or inadequate without them."
Further, to allow Congress to have two representatives in the Council, with one
vote each, is to negate the principle of equality among the three branches of
government which is enshrined in the Constitution.
In view of the foregoing, I vote for the proposition that the Council should adopt the
rule of single representation of Congress in the JBC in order to respect and give
the right meaning to the above-quoted provision of the Constitution. (Emphases
and underscoring supplied)
On March 14, 2007, then Associate Justice Leonardo A. Quisumbing, also a JBC
Consultant, submitted to the Chief Justice and ex-officio JBC Chairman his
opinion,29 which reads:
8. Two things can be gleaned from the excerpts and citations above: the creation
of the JBC is intended to curtail the influence of politics in Congress in the
appointment of judges, and the understanding is that seven (7) persons will
compose the JBC. As such, the interpretation of two votes for Congress runs
counter to the intendment of the framers. Such interpretation actually gives
Congress more influence in the appointment of judges. Also, two votes for
Congress would increase the number of JBC members to eight, which could lead
to voting deadlock by reason of even-numbered membership, and a clear violation
of 7 enumerated members in the Constitution. (Emphases and underscoring
supplied)
In an undated position paper,30 then Secretary of Justice Agnes VST Devanadera
opined:
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As can be gleaned from the above constitutional provision, the JBC is composed
of seven (7) representatives coming from different sectors. From the enumeration
it is patent that each category of members pertained to a single individual only.
Thus, while we do not lose sight of the bicameral nature of our legislative
department, it is beyond dispute that Art. VIII, Section 8 (1) of the 1987
Constitution is explicit and specific that "Congress" shall have only "xxx a
representative." Thus, two (2) representatives from Congress would increase the
number of JBC members to eight (8), a number beyond what the Constitution has
contemplated. (Emphases and underscoring supplied)
In this regard, the scholarly dissection on the matter by retired Justice Consuelo
Ynares-Santiago, a former JBC consultant, is worth reiterating.31 Thus:
A perusal of the records of the Constitutional Commission reveals that the
composition of the JBC reflects the Commission’s desire "to have in the Council a
representation for the major elements of the community." xxx The ex-officio
members of the Council consist of representatives from the three main branches of
government while the regular members are composed of various stakeholders in
the judiciary. The unmistakeable tenor of Article VIII, Section 8(1) was to treat each
ex-officio member as representing one co-equal branch of government. xxx Thus,
the JBC was designed to have seven voting members with the three ex-officio
members having equal say in the choice of judicial nominees.
xxx
No parallelism can be drawn between the representative of Congress in the JBC
and the exercise by Congress of its legislative powers under Article VI and
constituent powers under Article XVII of the Constitution. Congress, in relation to
the executive and judicial branches of government, is constitutionally treated as
another co-equal branch in the matter of its representative in the JBC. On the other
hand, the exercise of legislative and constituent powers requires the Senate and
the House of Representatives to coordinate and act as distinct bodies in
furtherance of Congress’ role under our constitutional scheme. While the latter
justifies and, in fact, necessitates the separateness of the two Houses of Congress
as they relate inter se, no such dichotomy need be made when Congress interacts
with the other two co-equal branches of government.
It is more in keeping with the co-equal nature of the three governmental branches
to assign the same weight to considerations that any of its representatives may
have regarding aspiring nominees to the judiciary. The representatives of the
Senate and the House of Representatives act as such for one branch and should
not have any more quantitative influence as the other branches in the exercise of
prerogatives evenly bestowed upon the three. Sound reason and principle of
equality among the three branches support this conclusion. [Emphases and
underscoring supplied]
The argument that a senator cannot represent a member of the House of
Representatives in the JBC and vice-versa is, thus, misplaced. In the JBC, any
member of Congress, whether from the Senate or the House of Representatives,
is constitutionally empowered to represent the entire Congress. It may be a
constricted constitutional authority, but it is not an absurdity.
From this score stems the conclusion that the lone representative of Congress is
entitled to one full vote. This pronouncement effectively disallows the scheme of
splitting the said vote into half (1/2), between two representatives of Congress. Not
only can this unsanctioned practice cause disorder in the voting process, it is
clearly against the essence of what the Constitution authorized. After all, basic and
reasonable is the rule that what cannot be legally done directly cannot be done
indirectly. To permit or tolerate the splitting of one vote into two or more is clearly a
constitutional circumvention that cannot be countenanced by the Court. Succinctly
put, when the Constitution envisioned one member of Congress sitting in the JBC,
it is sensible to presume that this representation carries with him one full vote.
It is also an error for respondents to argue that the President, in effect, has more
influence over the JBC simply because all of the regular members of the JBC are
his appointees. The principle of checks and balances is still safeguarded because
the appointment of all the regular members of the JBC is subject to a stringent
process of confirmation by the Commission on Appointments, which is composed
of members of Congress.
Respondents’ contention that the current irregular composition of the JBC should
be accepted, simply because it was only questioned for the first time through the
present action, deserves scant consideration. Well-settled is the rule that acts
done in violation of the Constitution no matter how frequent, usual or notorious
cannot develop or gain acceptance under the doctrine of estoppel or laches,
because once an act is considered as an infringement of the Constitution it is void
from the very beginning and cannot be the source of any power or authority.
It would not be amiss to point out, however, that as a general rule, an
unconstitutional act is not a law; it confers no rights; it imposes no duties; it affords
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no protection; it creates no office; it is inoperative as if it has not been passed at
all. This rule, however, is not absolute. Under the doctrine of operative facts,
actions previous to the declaration of unconstitutionality are legally recognized.
They are not nullified. This is essential in the interest of fair play. To reiterate the
doctrine enunciated in Planters Products, Inc. v. Fertiphil Corporation: 32
The doctrine of operative fact, as an exception to the general rule, only applies as
a matter of equity and fair play. It nullifies the effects of an unconstitutional law by
recognizing that the existence of a statute prior to a determination of
unconstitutionality is an operative fact and may have consequences which cannot
always be ignored. The past cannot always be erased by a new judicial
declaration. The doctrine is applicable when a declaration of unconstitutionality will
impose an undue burden on those who have relied on the invalid law. Thus, it was
applied to a criminal case when a declaration of unconstitutionality would put the
accused in double jeopardy or would put in limbo the acts done by a municipality in
reliance upon a law creating it.33
Under the circumstances, the Court finds the exception applicable in this case and
holds that notwithstanding its finding of unconstitutionality in the current
composition of the JBC, all its prior official actions are nonetheless valid.
Considering that the Court is duty bound to protect the Constitution which was
ratified by the direct action of the Filipino people, it cannot correct what
respondents perceive as a mistake in its mandate. Neither can the Court, in the
exercise of its power to interpret the spirit of the Constitution, read into the law
something that is contrary to its express provisions and justify the same as
correcting a perceived inadvertence. To do so would otherwise sanction the Court
action of making amendment to the Constitution through a judicial pronouncement.
In other words, the Court cannot supply the legislative omission. According to the
rule of casus omissus "a case omitted is to be held as intentionally omitted."34 "The
principle proceeds from a reasonable certainty that a particular person, object or
thing has been omitted from a legislative enumeration."35 Pursuant to this, "the
Court cannot under its power of interpretation supply the omission even though the
omission may have resulted from inadvertence or because the case in question
was not foreseen or contemplated."36 "The Court cannot supply what it thinks the
legislature would have supplied had its attention been called to the omission, as
that would be judicial legislation."37
Stated differently, the Court has no power to add another member by judicial
construction.
The call for judicial activism fails to stir the sensibilities of the Court tasked to guard
the Constitution against usurpation. The Court remains steadfast in confining its
powers in the sphere granted by the Constitution itself. Judicial activism should
never be allowed to become judicial exuberance.38 In cases like this, no amount of
practical logic or convenience can convince the Court to perform either an excision
or an insertion that will change the manifest intent of the Framers. To broaden the
scope of congressional representation in the JBC is tantamount to the inclusion of
a subject matter which was not included in the provision as enacted. True to its
constitutional mandate, the Court cannot craft and tailor constitutional provisions in
order to accommodate all of situations no matter how ideal or reasonable the
proposed solution may sound. To the exercise of this intrusion, the Court declines.
WHEREFORE, the Motion for Reconsideration filed by respondents is hereby
DENIED.
The suspension of the effects of the second paragraph of the dispositive portion of
the July 17, 2012 Decision of the Court, which reads, "This disposition is
immediately executory," is hereby LIFTED.
SO ORDERED.
G.R. No. 181359 August 5, 2013
SPOUSES CLEMENCIO C. SABITSANA, JR. and MA. ROSARIO M.
SABITSANA, Petitioners,
vs.
JUANITO F. MUERTEGUI, represented by his Attorney-in-Fact DOMINGO A.
MUERTEGUI, JR., Respondent.
DECISION
DEL CASTILLO, J.:
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A lawyer may not, for his own personal interest and benefit, gamble on his client's
word, believing it at one time and disbelieving it the next. He owes his client his
undivided loyalty.
Assailed in this Petition for Review on Certiorari1 are the January 25, 2007
Decision2 of the Court of Appeals (CA) which denied the appeal in CA-G.R. CV
No. 79250, and its January 11, 2008 Resolution3 denying petitioner’s Motion for
Reconsideration.4
Factual Antecedents
On September 2, 1981, Alberto Garcia (Garcia) executed an unnotarized Deed of
Sale5 in favor of respondent Juanito Muertegui6 (Juanito) over a 7,500-square
meter parcel of unregistered land (the lot) located in Dalutan Island, Talahid,
Almeira, Biliran, Leyte del Norte covered by Tax Declaration (TD) No. 1996 issued
in 1985 in Garcia’s name.7
Juanito’s father Domingo Muertegui, Sr. (Domingo Sr.) and brother Domingo Jr.
took actual possession of the lot and planted thereon coconut and ipil-ipil trees.
They also paid the real property taxes on the lot for the years 1980 up to 1998.
On October 17, 1991, Garcia sold the lot to the Muertegui family lawyer, petitioner
Atty. Clemencio C. Sabitsana, Jr. (Atty. Sabitsana), through a notarized deed of
absolute sale.8 The sale was registered with the Register of Deeds on February 6,
1992.9 TD No. 1996 was cancelled and a new one, TD No. 5327, 10 was issued in
Atty. Sabitsana’s name. Although Domingo Jr. and Sr. paid the real estate taxes,
Atty. Sabitsana also paid real property taxes in 1992, 1993, and 1999. In 1996, he
introduced concrete improvements on the property, which shortly thereafter were
destroyed by a typhoon.
When Domingo Sr. passed away, his heirs applied for registration and coverage of
the lot under the Public Land Act or Commonwealth Act No. 141. Atty. Sabitsana,
in a letter11 dated August 24, 1998 addressed to the Department of Environment
and Natural Resources’ CENRO/PENRO office in Naval, Biliran, opposed the
application, claiming that he was the true owner of the lot. He asked that the
application for registration be held in abeyance until the issue of conflicting
ownership has been resolved.
On April 11, 2000, Juanito, through his attorney-in-fact Domingo Jr., filed Civil
Case No. B-109712 for quieting of title and preliminary injunction, against herein
petitioners Atty. Sabitsana and his wife, Rosario, claiming that they bought the lot
in bad faith and are exercising acts of possession and ownership over the same,
which acts thus constitute a cloud over his title. The Complaint13 prayed, among
others, that the Sabitsana Deed of Sale, the August 24, 1998 letter, and TD No.
5327 be declared null and void and of no effect; that petitioners be ordered to
respect and recognize Juanito’s title over the lot; and that moral and exemplary
damages, attorney’s fees, and litigation expenses be awarded to him.
In their Answer with Counterclaim,14 petitioners asserted mainly that the sale to
Juanito is null and void absent the marital consent of Garcia’s wife, Soledad Corto
(Soledad); that they acquired the property in good faith and for value; and that the
Complaint is barred by prescription and laches. They likewise insisted that the
Regional Trial Court (RTC) of Naval, Biliran did not have jurisdiction over the case,
which involved title to or interest in a parcel of land the assessed value of which is
merely ₱1,230.00.
The evidence and testimonies of the respondent’s witnesses during trial reveal that
petitioner Atty. Sabitsana was the Muertegui family’s lawyer at the time Garcia sold
the lot to Juanito, and that as such, he was consulted by the family before the sale
was executed; that after the sale to Juanito, Domingo Sr. entered into actual,
public, adverse and continuous possession of the lot, and planted the same to
coconut and ipil-ipil; and that after Domingo Sr.’s death, his wife Caseldita,
succeeded him in the possession and exercise of rights over the lot.
On the other hand, Atty. Sabitsana testified that before purchasing the lot, he was
told by a member of the Muertegui family, Carmen Muertegui Davies (Carmen),
that the Muertegui family had bought the lot, but she could not show the document
of sale; that he then conducted an investigation with the offices of the municipal
and provincial assessors; that he failed to find any document, record, or other
proof of the sale by Garcia to Juanito, and instead discovered that the lot was still
in the name of Garcia; that given the foregoing revelations, he concluded that the
Muerteguis were merely bluffing, and that they probably did not want him to buy
the property because they were interested in buying it for themselves considering
that it was adjacent to a lot which they owned; that he then proceeded to purchase
the lot from Garcia; that after purchasing the lot, he wrote Caseldita in October
1991 to inform her of the sale; that he then took possession of the lot and gathered
ipil-ipil for firewood and harvested coconuts and calamansi from the lot; and that
he constructed a rip-rap on the property sometime in 1996 and 1997.
Ruling of the Regional Trial Court
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On October 28, 2002, the trial court issued its Decision 15 which decrees as follows:
WHEREFORE, in view of the foregoing considerations, this Court finds in favor of
the plaintiff and against the defendants, hereby declaring the Deed of Sale dated 2
September 1981 as valid and preferred while the Deed of Absolute Sale dated 17
October 1991 and Tax Declaration No. 5327 in the name of Atty. Clemencio C.
Sabitsana, Jr. are VOID and of no legal effect.
The Provincial Assessor and the Municipal Assessor of Naval are directed to
cancel Tax Declaration No. 5327 as void and done in bad faith.
Further, Atty. Clemencio C. Sabitsana, Jr. is ordered to pay plaintiff Juanito
Muertigui, represented by his attorney-in-fact Domingo Muertigui, Jr. the amounts
of:
a) ₱30,000.00 as attorney’s fees;
b) ₱10,000.00 as litigation expenses; and
c) Costs.
SO ORDERED.16
The trial court held that petitioners are not buyers in good faith. Petitioner Atty.
Sabitsana was the Muertegui family’s lawyer, and was informed beforehand by
Carmen that her family had purchased the lot; thus, he knew of the sale to Juanito.
After conducting an investigation, he found out that the sale was not registered.
With this information in mind, Atty. Sabitsana went on to purchase the same lot
and raced to register the sale ahead of the Muerteguis, expecting that his
purchase and prior registration would prevail over that of his clients, the
Muerteguis. Applying Article 1544 of the Civil Code,17 the trial court declared that
even though petitioners were first to register their sale, the same was not done in
good faith. And because petitioners’ registration was not in good faith, preference
should be given to the sale in favor of Juanito, as he was the first to take
possession of the lot in good faith, and the sale to petitioners must be declared null
and void for it casts a cloud upon the Muertegui title.
Petitioners filed a Motion for Reconsideration18 but the trial court denied19 the
same.
Ruling of the Court of Appeals
Petitioners appealed to the CA20 asserting that the sale to Juanito was null and
void for lack of marital consent; that the sale to them is valid; that the lower court
erred in applying Article 1544 of the Civil Code; that the Complaint should have
been barred by prescription, laches and estoppel; that respondent had no cause of
action; that respondent was not entitled to an award of attorney’s fees and litigation
expenses; and that they should be the ones awarded attorney’s fees and litigation
expenses.
The CA, through its questioned January 25, 2007 Decision,21 denied the appeal
and affirmed the trial court’s Decision in toto. It held that even though the lot
admittedly was conjugal property, the absence of Soledad’s signature and consent
to the deed did not render the sale to Juanito absolutely null and void, but merely
voidable. Since Garcia and his wife were married prior to the effectivity of the
Family Code, Article 173 of the Civil Code22should apply; and under the said
provision, the disposition of conjugal property without the wife’s consent is not
void, but merely voidable. In the absence of a decree annulling the deed of sale in
favor of Juanito, the same remains valid.
The CA added that the fact that the Deed of Sale in favor of Juanito was not
notarized could not affect its validity. As against the notarized deed of sale in favor
of petitioners, the CA held that the sale in favor of Juanito still prevails. Applying
Article 1544 of the Civil Code, the CA said that the determining factor is petitioners’
good faith, or the lack of it. It held that even though petitioners were first to register
the sale in their favor, they did not do so in good faith, for they already knew
beforehand of Garcia’s prior sale to Juanito. By virtue of Atty. Sabitsana’s
professional and confidential relationship with the Muertegui family, petitioners
came to know about the prior sale to the Muerteguis and the latter’s possession of
the lot, and yet they pushed through with the second sale. Far from acting in good
faith, petitioner Atty. Sabitsana used his legal knowledge to take advantage of his
clients by registering his purchase ahead of them.
Finally, the CA declared that Juanito, as the rightful owner of the lot, possessed
the requisite cause of action to institute the suit for quieting of title and obtain
judgment in his favor, and is entitled as well to an award for attorney’s fees and
litigation expenses, which the trial court correctly held to be just and equitable
under the circumstances.
The dispositive portion of the CA Decision reads:
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WHEREFORE, premises considered, the instant appeal is DENIED and the
Decision dated October 28, 2002 of the Regional Trial Court, 8th Judicial Region,
Branch 16, Naval, Biliran, is hereby AFFIRMED. Costs against defendants-
appellants.
SO ORDERED.23
Issues
Petitioners now raise the following issues for resolution:
I. THE COURT OF APPEALS ERRED IN NOT HOLDING THAT THE
REGIONAL TRIAL COURT DID NOT HAVE JURISDICTION OVER THE
CASE IN VIEW OF THE FACT THAT THE ASSESSED VALUE OF THE
SUBJECT LAND WAS ONLY ₱1,230.00 (AND STATED MARKET VALUE
OF ONLY ₱3,450.00).
II. THE COURT OF APPEALS ERRED IN APPLYING ART. 1544 OF THE
CIVIL CODE INSTEAD OF THE PROPERTY REGISTRATION DECREE
(P.D. NO. 1529) CONSIDERING THAT THE SUBJECT LAND WAS
UNREGISTERED.
III. THE COURT OF APPEALS ERRED IN NOT HOLDING THAT THE
COMPLAINT WAS ALREADY BARRED [BY] LACHES AND THE
STATUTE OF LIMITATIONS.
IV. THE COURT OF APPEALS ERRED IN AFFIRMING THE DECISION
OF THE REGIONAL TRIAL COURT ORDERING THE PETITIONERS TO
PAY ATTORNEY’S FEES AND LITIGATION EXPENSES TO THE
RESPONDENT.24
Petitioners’ Arguments
Petitioners assert that the RTC of Naval, Biliran did not have jurisdiction over the
case. They argue that since the assessed value of the lot was a mere ₱1,230.00,
jurisdiction over the case lies with the first level courts, pursuant to Republic Act
No. 7691,25 which expanded their exclusive original jurisdiction to include "all civil
actions which involve title to, or possession of, real property, or any interest therein
where the assessed value of the property or interest therein does not exceed
Twenty thousand pesos (₱20,000.00) or, in civil actions in Metro Manila, where
such assessed value does not exceed Fifty thousand pesos (₱50,000.00)
exclusive of interest, damages of whatever kind, attorney’s fees, litigation
expenses and costs."26 Petitioners thus conclude that the Decision in Civil Case
No. B-1097 is null and void for lack of jurisdiction.
Petitioners next insist that the lot, being unregistered land, is beyond the coverage
of Article 1544 of the Civil Code, and instead, the provisions of Presidential Decree
(PD) No. 1529 should apply. This being the case, the Deed of Sale in favor of
Juanito is valid only as between him and the seller Garcia, pursuant to Section 113
of PD 1529;27 it cannot affect petitioners who are not parties thereto.
On the issue of estoppel, laches and prescription, petitioners insist that from the
time they informed the Muerteguis in writing about their purchase of the lot, or in
October 1991, the latter did not notify them of their prior purchase of the lot, nor did
respondent interpose any objection to the sale in their favor. It was only in 1998
that Domingo Jr. showed to petitioners the unnotarized deed of sale. According to
petitioners, this seven-year period of silence and inaction on the Muerteguis’ part
should be taken against them and construed as neglect on their part to assert their
rights for an unreasonable length of time. As such, their action to quiet title should
be deemed barred by laches and estoppel.
Lastly, petitioners take exception to the award of attorney’s fees and litigation
expenses, claiming that since there was no bad faith on their part, such award may
not be considered just and equitable under the circumstances. Still, an award of
attorney’s fees should remain the exception rather than the rule; and in awarding
the same, there must have been an express finding of facts and law justifying such
award, a requirement that is absent in this case.
Petitioners thus pray for the reversal of the questioned CA Decision and
Resolution; the dismissal of the Complaint in Civil Case No. B-1097; the deletion of
the award of attorney’s fees and litigation expenses in respondent’s favor; and a
declaration that they are the true and rightful owners of the lot.
Respondent’s Arguments
Respondent, on the other hand, counters that a suit for quieting of title is one
whose subject matter is incapable of pecuniary estimation, and thus falls within the
jurisdiction of the RTC. He likewise insists that Article 1544 applies to the case
because there is a clear case of double sale of the same property to different
Page 51 of 507
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buyers, and the bottom line thereof lies in petitioners’ lack of good faith in entering
into the subsequent sale. On the issue of laches/estoppel, respondent echoes the
CA’s view that he was persistent in the exercise of his rights over the lot, having
previously filed a complaint for recovery of the lot, which unfortunately was
dismissed based on technicality.
On the issue of attorney’s fees and litigation expenses, respondent finds refuge in
Article 2208 of the Civil Code,28citing three instances which fortify the award in his
favor – petitioners’ acts compelled him to litigate and incur expenses to protect his
interests; their gross and evident bad faith in refusing to recognize his ownership
and possession over the lot; and the justness and equitableness of his case.
Our Ruling
The Petition must be denied.
The Regional Trial Court has jurisdiction over the suit for quieting of title.
On the question of jurisdiction, it is clear under the Rules that an action for quieting
of title may be instituted in the RTCs, regardless of the assessed value of the real
property in dispute. Under Rule 63 of the Rules of Court,29 an action to quiet title to
real property or remove clouds therefrom may be brought in the appropriate RTC.
It must be remembered that the suit for quieting of title was prompted by
petitioners’ August 24, 1998 letter-opposition to respondent’s application for
registration. Thus, in order to prevent30 a cloud from being cast upon his
application for a title, respondent filed Civil Case No. B-1097 to obtain a
declaration of his rights. In this sense, the action is one for declaratory relief, which
properly falls within the jurisdiction of the RTC pursuant to Rule 63 of the Rules.
Article 1544 of the Civil Code does not apply to sales involving unregistered land.
Both the trial court and the CA are, however, wrong in applying Article 1544 of the
Civil Code. Both courts seem to have forgotten that the provision does not apply to
sales involving unregistered land. Suffice it to state that the issue of the buyer’s
good or bad faith is relevant only where the subject of the sale is registered land,
and the purchaser is buying the same from the registered owner whose title to the
land is clean. In such case, the purchaser who relies on the clean title of the
registered owner is protected if he is a purchaser in good faith for value.31
Act No. 3344 applies to sale of unregistered lands.
What applies in this case is Act No. 3344,32 as amended, which provides for the
system of recording of transactions over unregistered real estate. Act No. 3344
expressly declares that any registration made shall be without prejudice to a third
party with a better right. The question to be resolved therefore is: who between
petitioners and respondent has a better right to the disputed lot?
Respondent has a better right to the lot.
The sale to respondent Juanito was executed on September 2, 1981 via an
unnotarized deed of sale, while the sale to petitioners was made via a notarized
document only on October 17, 1991, or ten years thereafter. Thus, Juanito who
was the first buyer has a better right to the lot, while the subsequent sale to
petitioners is null and void, because when it was made, the seller Garcia was no
longer the owner of the lot. Nemo dat quod non habet.
The fact that the sale to Juanito was not notarized does not alter anything, since
the sale between him and Garcia remains valid nonetheless. Notarization, or the
requirement of a public document under the Civil Code,33 is only for convenience,
and not for validity or enforceability.34 And because it remained valid as between
Juanito and Garcia, the latter no longer had the right to sell the lot to petitioners,
for his ownership thereof had ceased.
Nor can petitioners’ registration of their purchase have any effect on Juanito’s
rights. The mere registration of a sale in one’s favor does not give him any right
over the land if the vendor was no longer the owner of the land, having previously
sold the same to another even if the earlier sale was unrecorded. 35 Neither could it
validate the purchase thereof by petitioners, which is null and void. Registration
does not vest title; it is merely the evidence of such title. Our land registration laws
do not give the holder any better title than what he actually has. 36
Specifically, we held in Radiowealth Finance Co. v. Palileo37 that:
Under Act No. 3344, registration of instruments affecting unregistered lands is
‘without prejudice to a third party with a better right.’ The aforequoted phrase has
been held by this Court to mean that the mere registration of a sale in one’s favor
does not give him any right over the land if the vendor was not anymore the owner
of the land having previously sold the same to somebody else even if the earlier
sale was unrecorded.
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Petitioners’ defense of prescription, laches and estoppel are unavailing since their
claim is based on a null and void deed of sale. The fact that the Muerteguis failed
to interpose any objection to the sale in petitioners’ favor does not change
anything, nor could it give rise to a right in their favor; their purchase remains void
and ineffective as far as the Muerteguis are concerned.
The award of attorney’s fees and litigation expenses is proper because of
petitioners’ bad faith.
Petitioners’ actual and prior knowledge of the first sale to Juanito makes them
purchasers in bad faith. It also appears that petitioner Atty. Sabitsana was remiss
in his duties as counsel to the Muertegui family. Instead of advising the Muerteguis
to register their purchase as soon as possible to forestall any legal complications
that accompany unregistered sales of real property, he did exactly the opposite:
taking advantage of the situation and the information he gathered from his inquiries
and investigation, he bought the very same lot and immediately caused the
registration thereof ahead of his clients, thinking that his purchase and prior
registration would prevail. The Court cannot tolerate this mercenary attitude.
Instead of protecting his client’s interest, Atty. Sabitsana practically preyed on him.
Petitioner Atty. Sabitsana took advantage of confidential information disclosed to
him by his client, using the same to defeat him and beat him to the draw, so to
speak. He rushed the sale and registration thereof ahead of his client. He may not
be afforded the excuse that he nonetheless proceeded to buy the lot because he
believed or assumed that the Muerteguis were simply bluffing when Carmen told
him that they had already bought the same; this is too convenient an excuse to be
believed. As the Muertegui family lawyer, he had no right to take a position, using
information disclosed to him in confidence by his client, that would place him in
possible conflict with his duty. He may not, for his own personal interest and
benefit, gamble on his client’s word, believing it at one time and disbelieving it the
next. He owed the Muerteguis his undivided loyalty. He had the duty to protect the
client, at all hazards and costs even to himself.38
Petitioner Atty. Sabitsana is enjoined to "look at any representation situation from
the point of view that there are possible conflicts, and further to think in terms of
impaired loyalty, that is, to evaluate if his representation in any way will impair his
loyalty to a client."39
Moreover, as the Muertegui family’s lawyer, Atty. Sabitsana was under obligation
to safeguard his client's property, and not jeopardize it. Such is his duty as an
attorney, and pursuant to his general agency.40
Even granting that Atty. Sabitsana has ceased to act as the Muertegui family's
lawyer, he still owed them his loyalty.1âwphi1The termination of attorney-client
relation provides no justification for a lawyer to represent an interest adverse to or
in conflict with that of the former client on a matter involving confidential
information which the lawyer acquired when he was counsel. The client's
confidence once reposed should not be divested by mere expiration of
professional employment.41 This is underscored by the fact that Atty. Sabitsana
obtained information from Carmen which he used to his advantage and to the
detriment of his client.
from the foregoing disquisition, it can be seen that petitioners are guilty of bad faith
in pursuing the sale of the lot despite being apprised of the prior sale in
respondent's favor. Moreover, petitioner Atty. Sabitsana has exhibited a lack of
loyalty toward his clients, the Muerteguis, and by his acts, jeopardized their
interests instead of protecting them. Over and above the trial court's and the CA's
findings, this provides further justification for the award of attorney's fees, litigation
expenses and costs in favor of the respondent.
Thus said, judgment must be rendered in favor of respondent to prevent the
petitioners' void sale from casting a cloud upon his valid title.
WHEREFORE, premises considered, the Petition is DENIED. The January 25,
2007 Decision and the January 11, 2008 Resolution of the Court of Appeals in CA-
G.R. CV No. 79250 are AFFIRMED. Costs against petitioners.
SO ORDERED.
G.R. No. 209331, August 24, 2015 - DEPARTMENT OF FINANCE,
REPRESENTED BY HON. CESAR V. PURISIMA IN HIS OFFICIAL CAPACITY
AS SECRETARY, AND THE BUREAU OF CUSTOMS, REPRESENTED BY HON.
ROZZANO RUFINO B. BIAZON, IN HIS OFFICIAL CAPACITY AS
COMMISSIONER OF CUSTOMS, Petitioners, v. HON. MARINO M. DELA CRUZ,
JR., IN HIS CAPACITY AS EXECUTIVE JUDGE, REGIONAL TRIAL COURT,
MANILA, HON. FELICITAS O. LARON-CACANINDIN, IN HER CAPACITY AS
Page 53 of 507
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PRESIDING JUDGE, REGIONAL TRIAL COURT, MANILA, BRANCH 17,
RONNIE C. SILVESTRE, EDWARD P. DELA CUESTA, ROGEL C. GATCHALIAN,
IMELDA D.CRUZ, LILIBETH S. SANDAG, RAYMOND P. VENTURA, MA. LIZA S.
TORRES, ARNEL C. ALCARAZ, MA. LOURDES V. MANGAOANG, FRANCIS
AGUSTIN Y. ERPE, CARLOS T. SO, MARIETTA D. ZAMORANOS, CARMELITA
M. TALUSAN,1] AREFILES H. CARREON,2] AND ROMALINO G. VALDEZ,
Respondents.
SECOND DIVISION
G.R. No. 209331, August 24, 2015
DEPARTMENT OF FINANCE, REPRESENTED BY HON. CESAR V. PURISIMA
IN HIS OFFICIAL CAPACITY AS SECRETARY, AND THE BUREAU OF
CUSTOMS, REPRESENTED BY HON. ROZZANO RUFINO B. BIAZON, IN HIS
OFFICIAL CAPACITY AS COMMISSIONER OF CUSTOMS, Petitioners, v. HON.
MARINO M. DELA CRUZ, JR., IN HIS CAPACITY AS EXECUTIVE JUDGE,
REGIONAL TRIAL COURT, MANILA, HON. FELICITAS O. LARON-
CACANINDIN, IN HER CAPACITY AS PRESIDING JUDGE, REGIONAL TRIAL
COURT, MANILA, BRANCH 17, RONNIE C. SILVESTRE, EDWARD P. DELA
CUESTA, ROGEL C. GATCHALIAN, IMELDA D.CRUZ, LILIBETH S. SANDAG,
RAYMOND P. VENTURA, MA. LIZA S. TORRES, ARNEL C. ALCARAZ, MA.
LOURDES V. MANGAOANG, FRANCIS AGUSTIN Y. ERPE, CARLOS T. SO,
MARIETTA D. ZAMORANOS, CARMELITA M. TALUSAN,1] AREFILES H.
CARREON,2] AND ROMALINO G. VALDEZ, Respondents.
DECISION
CARPIO, J.:
The Case
Petitioners assail the Order dated 4 October 20133 issued by Judge Felicitas O.
Laron-Cacanindin (Judge Laron-Cacanindin) of the Regional Trial Court of Manila,
Branch 17 (RTC Branch 17), in Civil Case No. 13-130820. The Order extended the
72-hour Temporary Restraining Order (TRO) issued by Executive Judge Marino M.
Dela Cruz, Jr. (Executive Judge Dela Cruz) in favor of respondents Silvestre, et
al.4 to 20 days or until 21 October 2013 without need of posting bond.
The Antecedent Facts
The case stemmed from the issuance of Executive Order No. 140 (EO 140) on 2
September 2013, which created the Customs Policy Research Office (CPRO) in
the Department of Finance (DOF). EO 140 states that the CPRO "shall be
responsible for reviewing the customs administration policies, rules and
procedures, and thereafter providing sound recommendations for the improvement
of the same." Section 3 of EO 140 provides that "CPRO shall be composed of its
organic personnel, as approved by the Department of Budget and Management
(DBM) upon recommendation of the DOF Secretary, augmented and reinforced by
DOF and BOC personnel as well as those detailed or seconded from other
agencies, whether attached to the DOF or not. x x x." Section 9 of EO 140 states
that it shall "take effect immediately upon publication in two (2) newspapers of
general circulation." EO 140 was published in Manila Bulletin and Philippine
Star on 17 September 2013.
On the same day of the publication of EO 140, Bureau of Customs (BOC)
Commissioner Rozzano Rufino B. Biazon (Commissioner Biazon) issued Customs
Personnel Order No. B-189-2013 (CPO 189-2013) detailing 27 BOC personnel
holding the positions of Collector of Customs V and VI, including respondents in
this case, to CPRO "effective immediately and valid until sooner revoked." CPO
189-2013 was approved by DOF Secretary Cesar V. Purisima (Secretary
Purisima).
On 30 September 2013, respondents filed an action for Declaratory Relief with
Application for Temporary Restraining Order and/or Writ of Preliminary Injunction
before the Regional Trial Court (RTC) of Manila. On 1 October 2013, Executive
Judge Dela Cruz issued a TRO for a period of 72 hours enjoining petitioners or any
person acting for and in their behalf from implementing CPO 189-2013. Thereafter,
the case was raffled to the sala of Judge Laron-Cacanindin.
In the assailed Order of 4 October 2013, Judge Laron-Cacanindin extended
Executive Judge Dela Cruz's 72-hour TRO for 20 days or until 21 October 2013.
Page 54 of 507
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She then set the hearing for the issuance of a preliminary injunction on 18 October
2013.
On 21 October 2013, petitioners filed a Petition for Certiorari and Prohibition before
this Court, with prayer for the issuance of a TRO or a writ of preliminary mandatory
injunction. Petitioners alleged that the case involves personnel action affecting
public officers which is under the exclusive jurisdiction of the Civil Service
Commission (CSC). Petitioners also alleged that respondents failed to exhaust all
administrative remedies available to them before filing the petition before the RTC.
Petitioners also alleged that CPO 189-2013 is an internal personnel order with
application that is limited to and only within BOC and as such, it cannot be the
subject of an action for declaratory relief.
In their Comment, respondents alleged that the case involves the validity and
constitutionality of CPO 189-2013, and thus, it is beyond the jurisdiction of the
CSC. Respondents further alleged that EO 140 violated Article 2 of the Civil Code
when it became effective immediately after its publication.
In their Reply, petitioners alleged that respondents only assailed the validity of EO
140 to justify their filing of an action for declaratory relief. As regards its effectivity,
petitioners alleged that EO 140 states that it shall "take effect immediately upon
publication in two (2) newspapers of general circulation."
In an Order dated 21 October 2013, Judge Laron-Cacanindin denied respondents'
application for the issuance of a writ of preliminary injunction.
In an Order dated 5 November 2013, Judge Laron-Cacanindin inhibited herself
from further hearing the case.
The Issues
The issues for determination by this Court are the following:cralawlawlibrary
1. Whether the RTC has jurisdiction over the action for declaratory
relief filed by respondents;
2. Whether respondents failed to exhaust administrative remedies in
filing the action before the RTC;
3. Whether EO 140 violated Article 2 of the Civil Code when it
became effective immediately after its publication; and
4. Whether CPO 189-2013 was validly issued.
The Ruling of this Court
Jurisdiction over the Petition
The CSC has jurisdiction over all employees of government branches,
subdivisions, instrumentalities, and agencies, including government-owned or
controlled corporations with original charters.5 The CSC is the sole arbiter of
controversies relating to the civil service.6 The rule is that disciplinary cases and
cases involving personnel actions, including "appointment through certification,
promotion, transfer, reinstatement, reemployment, detail, reassignment, demotion,
and separation," are within the exclusive jurisdiction of the CSC.7 This rule is
embodied in Section 1, Rule V of the Omnibus Rules Implementing Book V of
Executive Order No. 292 and Other Pertinent Civil Service Laws (Omnibus Rules)
which states:cralawlawlibrary
SECTION 1. x x x.
As used in these Rules, any action denoting movement or progress of personnel in
the civil service shall be known as personnel action. Such action shall include
promotion, transfer, reinstatement, reemployment, detail, secondment,
reassignment, demotion and separation, x x x.
Under Section 8, Rule VII of the Omnibus Rules, "[a] detail is the movement of an
employee from one department or agency which is temporary in nature, which
does not involve a reduction in rank, status or salary and does not require the
issuance of another appointment." CPO 189-2013 is an order detailing personnel
from the BOC to CPRO under the DOF.
A reading of the petition filed before the RTC shows that respondents were
questioning their mass detail and reassignment to CPRO. According to
respondents, their detail was carried out in bad faith and was meant to remove
them from their permanent positions in the BOC. The action appears to be a
personnel action under the jurisdiction of the CSC.
However, the petition went beyond questioning the detail of respondents.
Respondents further assailed the validity and constitutionality of CPO 189-2013.
Respondents alleged that CPO 189-2013 was issued even before EC) 140,
pursuant to which CPO 189-2013 was issued, became effective. Respondents
alleged that CPO 189-2013 was issued to beat the deadline of the Commission on
Elections' ban on personnel movement from 28 September 2013 to 20 October
2013 due to the scheduled barangay elections. When respondents raised the issue
Page 55 of 507
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of validity and constitutionality of CPO 189-2013, the issue took the case beyond
the scope of the CSC's jurisdiction because the matter is no longer limited to Article 2 of the Civil Code of the Philippines, as amended by Executive Order No.
personnel action. Thus, the RTC did not abuse its discretion in taking cognizance 200,11 is clear on this issue. It states:cralawlawlibrary
of the action. Art. 2. Laws shall take effect after fifteen days following the completion of their
publication either in the Official Gazette, or in a newspaper of general circulation in
Failure to Exhaust Administrative Remedies the Philippines, unless it is otherwise provided.
The proviso "unless it is otherwise provided" refers to an effectivity date other than
Petitioners allege that respondents failed to exhaust their administrative remedies after fifteen days following the completion of the law's publication.12 Thus, it is
before filing the case with the RTC. within the discretion of the legislature, or the Executive Department in this case,
whether to shorten or extend the fifteen-day period13 as long as there is
The doctrine of exhaustion of administrative remedies allows administrative
compliance with the requirement of publication.
agencies to carry out their functions and discharge their responsibilities within the
specialized areas of their respective competence.8The doctrine entails lesser
Here, Section 9 of EO 140 provides that the "order shall take effect immediately
expenses and provides for the speedier resolution of controversies. 9Therefore, upon publication in two (2) newspapers of general circulation." EO 140 was
direct recourse to the trial court, when administrative remedies are available, is a published in Manila Bulletin and Philippine Star on 17 September 2013. As such,
ground for dismissal of the action.
EO 140 took effect on 17 September 2013.
The doctrine, however, is not without exceptions. Among the exceptions are: (1)
In addition, the Court already ruled that "[interpretative regulations and those
where there is estoppel on the part of the party invoking the doctrine; (2) where the
merely internal in nature, that is, regulating only the personnel of the administrative
challenged administrative act is patently illegal, amounting to lack of jurisdiction; agency and not the public, need not be published."14 EO 140 is an internal
(3) where there is unreasonable delay or official inaction that will irretrievably regulation that affects primarily the personnel of the DOF and the BOC. It remains
prejudice the complainant; (4) where the amount involved is relatively so small as
valid even without publication.
to make the rule impractical and oppressive; (5) where the question involved is
purely legal and will ultimately have to be decided by the courts of justice; (6)
Validity of CPO 189-2013
where judicial intervention is urgent; (7) where the application of the doctrine may
cause great and irreparable damage; (8) where the controverted acts violate due
Respondents assail the validity of CPO 189-2013. Respondents allege that under
process; (9) where the issue of non-exhaustion of administrative remedies had
EO 140, CPRO shall be composed of its organic personnel, as approved by the
been rendered moot; (10) where there is no other plain, speedy and adequate
DBM upon recommendation of the DOF Secretary. The organic personnel was
remedy; (11) where strong public interest is involved; and (12) in quo warranto
supposed to be augmented and reinforced by DOF and BOC personnel.
proceedings.10cralawrednad
Respondents allege that they were detailed to CPRO even before its organic
personnel could be constituted.
In this case, respondents allege that CPO 189-2013 is contrary to law and
unconstitutional. Respondents assail CPO 189-2013 as patently illegal, arbitrary,
We rule for respondents.
and oppressive. This case clearly falls within the exceptions where exhaustion of
administrative remedies need not be resorted to by respondents.
Section 3 of EO 140 provides:cralawlawlibrary
SECTION 3. Personnel and Staffing Complement. The CPRO shall be composed
Effectivity of EO 140
of its organic personnel, as approved by the Department of Budget and
Management (DBM) upon recommendation of the DOF Secretary, augmented and
Respondents allege that EO 140 took effect only on 2 October 2013, fifteen days
reinforced by DOF and BOC personnel as well as those detailed or seconded from
after its publication in two newspapers of general circulation. Hence, respondents
other agencies, whether attached to the DOF or not. In addition, the CPRO, upon
argue that when CPO 189-2013 was issued, EO 140 was not yet effective.

Page 56 of 507
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approval of the DOF Secretary, may hire or engage technical consultants to
provide necessary support in the performance of its mandate.
Respondents were supposed to augment and reinforce the existing organic
personnel of CPRO. Yet, at the time of respondents' detail, CPRO had not been
formally organized. CPRO had no organic personnel that had been approved by
the DBM upon recommendation of the DOF Secretary. The DOF Secretary had yet
to promulgate rules and regulations and to prescribe procedures and processes to
enable CPRO to effectively exercise its powers and duties, as required by Section
4 of EO 140.
In addition, under Section 8, Rule VII of the Omnibus Rules, a detail is temporary
in nature. In fact, detail of employees is only allowed for a maximum, period for
those occupying professional, technical, and scientific positions. 15 Section 8, Rule
VII of the Omnibus Rules provides:cralawlawlibrary
SEC. 8. A detail is the movement of an employee from one department or agency
to another which is temporary in nature, which does not involve a reduction in rank,
status or salary and does not require the issuance of another appointment.
The employee detailed receives his salary only from his mother unit/agency.
Detail shall be allowed only for a maximum period in the case of employees
occupying professional, technical and scientific position. If the employee believes
that there is no justification for the detail, he may appeal his case to the
Commission. Pending appeal, the decision to detail the employee shall be
executory unless otherwise ordered by the Commission.
Section 2 of CSC Resolution No. 021181, dated 13 September 2002, 16 clarified the
maximum period of detail of employees. It states:cralawlawlibrary
Section 2. Duration of the detail. The detail shall be allowed only for a maximum
period of one year. Details beyond one year may be allowed provided it is with the
consent of the detailed employee. The extension or renewal of the period of the
detail shall be within the authority of the mother agency.
If the employee believes that there is no justification for the detail, he/she may
appeal his/her case to the proper Civil Service Commission Regional Office.
Pending appeal, the detail shall be executory unless otherwise ordered by said
regional office. Decision of said regional office may be further appealed to the
Commission en banc.
In this case, CPO 189-2013 did not provide for the period of respondents' detail. It
only provided that the order "shall be effective immediately and valid until sooner
revoked," making the detail of respondents indefinite. There was nothing to show
that respondents were occupying professional, technical, and scientific positions
that would have allowed their detail for the maximum period provided under
Section 8, Rule VII of the Omnibus Rules. Further, CSC Resolution No. 021181 did
not distinguish between an ordinary employee and an employee occupying
professional, technical, and scientific position. Hence, it should have been
specified that the maximum period of respondents' detail should not exceed one
year.
Petitioners assert, and we quote:cralawlawlibrary
There is a cancer of corruption we must extinguish. The drive to rid the
government of graft and corruption deserves the support of everyone.
The principle of good governance cannot, should not, be trivialized nor
oversimplified by tenuous whimpering and individualism intended to detract from
the urgent need to cleanse the Republic from a mainstream culture of unabated
corruption, perpetuated with impunity and sense of self-entitlement. The issue at
hand is not about who, but what; it is not about individual loss, but about national
gain. Whether from the birth pains of reform, this nation can gain a foothold, nay, a
stride into restoring this nation into its prideful place from the clutches of a
"kleptocratic mafia" that had gained a strangehold into one of the nation's primary
sources of revenue.17
Indeed, we commend and support the reforms being undertaken in the different
agencies of the government. However, we cannot allow department heads to take
shortcuts that will undermine and disregard the basic procedures of the law.
WHEREFORE, we PARTIALLY GRANT the petition. We sustain the validity of
Executive Order No. 140. We rule that the Regional Trial Court has jurisdiction
over the action for declaratory relief filed by respondents. We further rule that
Customs Personnel Order No. B-189-2013 was not validly issued.
SO ORDERED.chanrobles virtuallawlibrary
Peralta,*Del Castillo, and Mendoza, JJ., concur.ChanRoblesVirtualawlibrary
Leonen, J., see separate dissenting opinion.
Endnotes:
*
Designated acting member per Raffle dated 10 August 2015.
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1Carmelita M. Talusan withdrew as petitioner in Civil Case No. 13-130820, noted that the detail shall be allowed "only for a limited period in the case of employees
by the trial court in its Order dated 4 October 2013. Rollo, p. 58. occupying professional, technical and scientific positions."
2Arefiles H. Carreon manifested his intent to withdraw as petitioner in Civil Case 16 As contained in CSC Memorandum Circular No. 21, Series of 2002.
No. 13-130820 per letter to counsel dated 16 October 2013. Id. at 119.
17Rollo, p. 10.
3 Id. at 57-63.

4Ronnie C. Silvestre, Edward P. Dela Cuesta, Rogel C. Gatchalian, Imelda D.

Cruz, Lilibeth S. Sandag, Raymond P. Ventura, Ma. Liza S. Torres, Arnel C.
Alacaraz, Ma. Lourdes V. Mangaoang, Francis Agustin Y. Erpe, Carlos T. So,
DISSENTING OPINION
Marietta D. Zamoranos, Carmelita M. Talusan, Arefiles H. Carreon, and Romalino
G. Valdez.
LEONEN, J.:
5Corsiga v. Judge Defensor, 439 Phil. 875 (2002).

6 Id. Respectfully, I dissent.

7Olanda v. Bugayong, 459 Phil. 626 (2003). The Civil Service Commission has exclusive jurisdiction over questions regarding
personnel actions affecting civil service employees.3 It is the sole arbiter that
8AdditionHills Mandahiyong Civic & Social Organization, Inc. v. Megaworld decides controversies regarding the civil service at first instance. 4 Courts should
Properties & Holdings, Inc., G.R. No. 175039, 18 April 2012, 670 SCRA 83. not directly assume jurisdiction based on allegations of unconstitutionality and
invalidity of government regulations when the question, in essence, involves a
9 Id. personnel action.

10Vigilar v. Aquino, 654 Phil. 755 (2011). This is a Petition for certiorari and prohibition with very urgent prayer for the
immediate issuance of a temporary restraining order and/or writ of preliminary
11Providing for the Publication of Laws Either in the Official Gazette or in a mandatory injunction5 filed by the Department of Finance and the Bureau of
Newspaper of General Circulation in the Philippines as a Requirement for their Customs before this court, assailing the Manila Regional Trial Court's Order 6dated
Effectivity. October 1, 2013 issued by Executive Judge Marino M. Dela Cruz, Jr., the
Order7 dated October 4, 2013 issued by Presiding Judge Felicitas O. Laron-
12Nagkakaisang Maralila ng Sitio Masigasig, Inc. v. Military Shrine Services- Cacanindin, and all other subsequent Orders preventing the implementation of
Philippine Veteran Affairs Office, Department of National Defense, G.R. No. Customs Personnel Order No. B-1 89-2013.8 The Department of Finance and
187587, 5 June 2013, 697 SCRA 359. Bureau of Customs also pray for the dismissal of the Petition for declaratory relief
filed by private respondents before the Regional Trial Court of
13Tañadav. Tuvera, 230 Phil. 528 (1986), Resolution on Motion for Manila.9cralawrednad
Reconsideration.
On September 2, 2013, President Benigno Aquino III issued Executive Order No.
14 Id. 14010 creating the Customs Policy Research Office in the Department of
Finance.11 The Customs Policy Research Office shall review the Bureau of
15 Section 26(6), Chapter V, Book V, Title I of Executive Order No. 292 provides Customs' administration policies, rules, and procedures, and provide

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recommendations for their improvement.12 Section 3 of Executive Order No. 140 3. DELA CUESTA, EDUARD PALAFOX Collector of Customs VI (26)
provides for the composition of the Customs Policy Research 4. BELMONTE, RICARDO RACIMO Collector of Customs VI (26)
Office:cralawlawlibrary 5. MOLINA, ADELINA SANTOS ESTRELLA Collector of Customs VI (26)
SECTION 3. Personnel and Staffing Complement. The [Customs Policy
6. SILVESTRE, RONNIE CRUZ Collector of Customs VI (26)
Research Office] shall be composed of its organic personnel, as approved by the
Department of Budget and Management (DBM) upon recommendation of the 7. MANDANGAN, MACABANTUG
Collector of Customs V (25)
[Department of Finance] Secretary, augmented and reinforced by [Department of DIMAPUNTUG
Finance] and [Bureau of Customs] personnel as well as those detailed or 8. BAUZON, PR1SCILLA DE VERA Collector of Customs V (25)
seconded from other agencies, whether attached to the [Department of Finance] or 9. CRUZ, IMELDA DE JESUS Collector of Customs V (25)
not. In addition, the [Customs Policy Research Office], upon approval of the 10. TOGONON, MA. SONIA IRINEA
Collector of Customs V (25)
[Department of Finance] Secretary, may hire or engage technical consultants to CALUYO
provide necessary support in the performance of its mandate.13 11. SANDAG L1LIBETH SUMBILLA Collector of Customs V (25)
Executive Order No. 140 was published on September 17, 2013 in Manila Bulletin 12. VENTURA, RAYMOND P. Collector of Customs V (25)
and Philippine Star.14Section 9 of Executive Order No. 140 13. ROQUE, TERESITA SIOSON Collector of Customs V (25)
provides:cralawlawlibrary 14. TORRES, MA. LIZA SEBASTIAN Collector of Customs V (25)
SECTION 9. Effectivity. This Order shall take effect immediately upon publication 15. MARTIN, MARITESS THEODOSSIS Collector of Customs V (25)
in two (2) newspapers of general circulation.15 16. ALCARAZ, ARNEL CRUZ Collector of Customs V (25)
On September 17, 2013, or on the same day of publication of Executive Order No. 17. ALCID, TOMAS LADERA Collector of Customs V (25)
140, Bureau of Customs Commissioner Rozzano Rufino B. Biazon issued 18. MANGAOANQ MA. LOURDES
Customs Personnel Order No. B-189-2013,16with the approval of Department of Collector of Customs V (25)
VILLAMAR
Finance Secretary Cesar V. Purisima.17 Customs Personnel Order No. B-189-2013 19. ERPE, FRANCIS AGUSTIN YANCHA Collector of Customs V (25)
detailed 27 Bureau of Customs personnel to the Customs Policy Research Office
20. VILLAGARCIA, ROGELIO VELACRUZ Collector of Customs V (25)
under the Department of Finance.18 Thus:
September 17, 2013 21. ZAMORANOS, MARIETTA DANTE Collector of Customs V (25)
22. TAN, JUAN NAT1VIDAD Collector of Customs V (25)
CUSTOMS PERSONNEL ORDER 23. TALUSAN, CARMELITA MANAHAN Collector of Customs V (25)
No. B-189-2013 24. CARREON, AREFILES HAMOY Collector of Customs V (25)
25. PACARDO, RUSTUM LANUEVO Collector of Customs V (25)
Under Section 3 of Executive Order No. 140, series of 2013, the Customs Policy 26. VALDEZ, ROMALINO GABRIEL Collector of Customs V (25)
Research Office ("the CPRO") shall be composed of its organic personnel, 27. PABLO, TALEK J. Collector of Customs V (25)
augmented and reinforced by personnel from the Department of Finance and
Bureau of Customs as well [as] those detailed or seconded from other agencies.
All orders, circulars, memoranda, issuances contrary to or inconsistent herewith
Pursuant to the foregoing, the following personnel are detailed from the Bureau of
are hereby revoked and/or modified, and all concerned shall be guided
Customs to [Customs Policy Research Office] under the Department of
accordingly.
Finance:ChanRoblesvirtualLawlibrary
This Order shall be effective immediaitely and valid until sooner revoked.
FULL NAME POSITION TITLE AND SALARY
(Surname, First Name) GRADE For strict compliance.
1. GATCHALIAN, ROGEL CRUZ Collector of Customs VI (26)
2. SO, CARLOS TAN Collector of Customs VI (26)
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 (signed)
ROZZANO RUFINO B. BIAZON
Commissioner of Customs
APPROVED:ChanRoblesvirtualLawlibrary
(signed)
CESAR V. PURISIMA
Secretary
Department of Finance
Date:________19
Only 1220 of the affected employees complied with the directive in Customs
Personnel Order No. B-189-2013 and reported to the Customs Policy Research
Office after its effectivity on September 17, 2014.21cralawrednad
The other 1522 affected employees refused to comply with the Order23 and instead
filed on September 30, 2013 a Petition24 for declaratory relief with an application
for a temporary restraining order and/or a writ of preliminary injunction before the
Regional Trial Court of Manila.25cralawredcralawrednad
The 15 employees assailed the validity of Customs Personnel Order No. B-189-
2013.26 They argued that Customs Personnel Order No. B-189-2013 violated (a)
Section 70327 of Republic Act No. 1937 or the Tariff and Customs Code;28 (b) their
right to security of tenure as career service officers defined under Book V, Title I,
Subtitle A, Chapter 2, Section 7 of Executive Order No. 292;29 and (c) Section 3 of
Executive Order No. 140.30 They further argued that Customs Personnel Order No.
B-189-2013 was invalid for having been issued prior to the effectivity of Executive
Order No. 140.31 They relied on Article 232 of the Civil Code that provides that laws
become effective 15 days after complete publication.33cralawrednad
On October 1, 2013, Executive Judge Marino M. Dela Cruz, Jr. granted a 72-hour
temporary restraining order to stop the implementation of Customs Personnel
Order No. B-189-2013.34 The case was then raffled to Branch 17 presided by
Judge Felicitas O. Laron-Cacanindin (Judge Laron-Cacanindin).35cralawrednad
On October 4, 2013,36 the Department of Finance and the Bureau of Customs filed
a Motion to Dismiss.37They argued that the Regional Trial Court had no jurisdiction
over the employees' Petition for declaratory relief and that the requisites for the
filing of a Petition for declaratory relief were lacking.38cralawrednad
In the Order dated October 4, 2013, Judge Laron-Cacanindin extended the
temporary restraining order to 20 days after finding that Customs Personnel Order
No. B-189-2013 had "violate[d] the rules on detail because it failed to provide the
duration of the detail."39 In the same Order, Judge Laron-Cacanindin stated that
the Order was without prejudice to further findings of the court after trial on the
merits of the main case for declaratory relief.40cralawrednad
In the Order41 dated October 21, 2013, Judge Laron-Cacanindin denied the
employees' application for a writ of preliminary injunction.42 The denial of their
application for a writ of preliminary injunction prompted six (6) of the employees
who filed the Petition to report to the Customs Policy Research Office.43 The
returning employees reasoned that they reported for work so they would not be
charged with insubordination.44cralawrednad
On October 21, 2013, the Department of Finance and Bureau of Customs filed this
Petition for certiorari and prohibition.45cralawrednad
This court required the 15 employees to file a Comment on the Petition. 46 After
filing the Comment,47the Department of Finance and Bureau of Customs were
ordered to file a Reply.48cralawrednad
In their Petition for certiorari, the Department of Finance and Bureau of Customs
argued that the Civil Service Commission, not the Regional Trial Court, had
jurisdiction over the subject matter of this case and that the 15 employees failed to
exhaust all available administrative remedies before filing their Petition for
declaratory relief.49 According to the Department of Finance and Bureau of
Customs, Customs Personnel Order No. B-189-2013 was a personnel action, and
questions involving personnel actions in the civil service should be lodged before
the Civil Service Commission.50cralawrednad
Further, the Department of Finance and Bureau of Customs argued that some of
the requirements for filing a Petition for declaratory relief were absent.51 First, a
declaratory relief is available only when the government issuance being
questioned is a national law or an ordinance of general application, 52 Since
Customs Personnel Order No. B-189-2013 was an internal personnel order whose
application was limited within the Bureau of Customs, it cannot be a subject of a
Petition for declaratory relief.53 Second, the declaratory relief was no longer
available because Customs Personnel Order No. B-189-2013 had been breached
prior to the filing of the Petition.54 The 15 employees allegedly committed a breach
when they failed to report to the Customs Policy Research Office upon the
effectivity of Customs Personnel Order No. B-189-2013 on September 17,
2013.55 Third, a declaratory relief was not available to the 15 employees because
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they had an adequate remedy with the Civil Service Commission.56cralawrednad
Regarding the duration of the detail, the Department of Finance and Bureau of
Customs argued that the detail was not indefinite and that pursuant to Civil Service
Commission Resolution No. 02118157 or the Policies on Detail, the detail shall only
last for at most, one (1) year.58cralawrednad
In their Comment dated January 8, 2014, the 15 employees countered that the
Regional Trial Court had jurisdiction as the main issue was the validity and
constitutionality of Customs Personnel Order No. B-189-2013.59 The resolution of
this issue required the exercise of judicial review, which was beyond the
competence of the Civil Service Commission.60cralawrednad
Since the 15 employees' Petition for declaratory relief alleges that Customs
Personnel Order No. B-189-2013 is unconstitutional and invalid, those allegations
should suffice for the Regional Trial Court to assume jurisdiction. 61cralawrednad
According to the 15 employees, Customs Personnel Order No. B-189-2013 is
unconstitutional for violating their right to security of tenure.62 Their detail to the
Customs Policy and Research Office amounts to constructive dismissal63 as they
are now "mere researchers[.]"64cralawrednad
The 15 employees argue that all the requisites for the filing of a Petition for
declaratory relief are present.65 They claim that Customs Personnel Order No. B-
189-2013 is a government regulation, affecting their rights, duties, rank, and
status.66 Hence, Customs Personnel Order No. B-189-2013 is a proper subject of a
Petition for declaratory relief.67 They also argue that Customs Personnel Order No.
B-189-2013 is void, producing no effect.68 According to them, a void or
unconstitutional law or issuance cannot be a source of an obligation so it cannot
be breached.69cralawrednad
This case should consider the following issues:ChanRoblesvirtualLawlibrary
First, whether the Regional Trial Court has jurisdiction over private respondents'
Petition for declaratory relief;
Second, whether all the requisites for the filing of a Petition for declaratory relief
are present; and
Finally, whether Customs Personnel Order No. B-189-2013 is void because of its
indefinite term.
I.
The Constitution confers jurisdiction over the Civil Service Commission for cases
involving the civil service. Article IX(B), Section 1(1) of the Constitution
provides:cralawlawlibrary
SECTION 1.(1) The Civil Service shall be administered by the Civil Service
Commissioncomposed of a Chairman and two Commissioners who shall be
natural-born citizens of the Philippines and, at the time of their appointment, at
least thirty-five years of age, with proven capacity for public administration, and
must not have been candidates for any elective position in the elections
immediately preceding their appointment. (Emphasis supplied)
As part of the Civil Service Commission's mandate to administer the civil service,
Article IX(B), Section 3 of the Constitution provides:cralawlawlibrary
SECTION 3. The Civil Service Commission, as the central personnel agency of the
Government, shall establish a career service and adopt measures to promote
morale, efficiency, integrity, responsiveness, progressiveness, and courtesy in the
civil service. It shall strengthen the merit and rewards system, integrate all human
resources development programs for all levels and ranks, and institutionalize a
management climate conducive to public accountability. It shall submit to the
President and the Congress an annual report on its personnel programs.
(Emphasis supplied)
The Constitution gives the Civil Service Commission quasi-judicial powers through
Article IX(A), Sections 6 and 7, which provide:cralawlawlibrary
SECTION 6. Each Commission en banc may promulgate its own rules
concerning pleadings and practice before it or before any of its offices. Such rules,
however, shall not diminish, increase, or modify substantive rights.
SECTION 7. Each Commission shall decide by a majority vote of all its Members
any case or matter brought before it within sixty days from the date of its
submission for decision or resolution. A case or matter is deemed submitted for
decision or resolution upon the filing of the last pleading, brief, or memorandum
required by the rules of the Commission or by the Commission itself. Unless
otherwise provided by this Constitution or by law, any decision, order, or ruling of
each Commission may be brought to the Supreme Court on certiorari by the
aggrieved party within thirty days from receipt of a copy thereof. (Emphasis
supplied)
As the "central personnel agency of the Government,"70 Book V, Title I, Subtitle A,
Chapter 3, Section 12(11) of Executive Order No. 292 or the Administrative Code
of 1987 provides:cralawlawlibrary
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SECTION 12. Powers and Functions. — The [Civil Service] Commission shall
have the following powers and functions:ChanRoblesvirtualLawlibrary
....
(11)Hear and decide administrative cases instituted by or brought before it directly
or on appeal, including contested appointments, and review decisions and
actions of its offices and of the agencies attached to it. Officials and employees
who fail to comply with such decisions, orders, or rulings shall be liable for
contempt of the Commission. Its decisions, orders, or rulings shall be final and
executory. Such decisions, orders, or rulings may be brought to the Supreme
Court on certiorari by the aggrieved party within thirty (30) days from receipt of
a copy thereof[.] (Emphasis supplied)
Further, for the implementation of Book V, Title I, Subtitle A, Chapter 3, Section
12(11) of Executive Order No. 292,71 Sections 5(B)(3), 6(B)(3), and 7(B)(2) of Civil
Service Commission Memorandum Circular No. 19-99 or the Revised Uniform
Rules on Administrative Cases in the Civil Service lay down the different offices of
the civil service where complaints involving personnel actions should be filed.
Hence:cralawlawlibrary
SECTION 5. Jurisdiction of the Civil Service Commission Proper.72 — The Civil
Service Commission Proper shall have jurisdiction over the following
cases:cralawlawlibrary
....
B. Non-Disciplinary
....
3. Protests against the appointment, or other personnel actions, involving third
level officials;73 and
....
SECTION 6. Jurisdiction of Civil Service Regional Offices. — The Civil Service
Commission Regional Offices shall have jurisdiction over the following
cases:cralawlawlibrary
....
B. Non-Disciplinary
....
3. Decisions of national agencies and local
government units within their geographical
boundaries relative to personnel actions and non-
disciplinary cases brought before it on appeal; and
....
SECTION 7. Jurisdiction of Heads of Agencies. — Heads of Departments,
agencies, provinces, cities, municipalities and other instrumentalities shall have
original concurrent jurisdiction, with the Commission,74 over their respective
officers and employees.chanrobleslaw
....
B. Non-Disciplinary
2. Complaints on personnel actions and other non-disciplinary actions of their
respective personnel. (Emphasis supplied)
As the "central personnel agency of the Government"75 with quasi-judicial
powers76 and as the body tasked to administer the civil service,77 the Civil Service
Commission is the "sole arbiter of controversies relating to the civil
service[,]"78 including personnel actions, as this court has ruled.79cralawrednad
The material allegations in the Complaint or Petition and the character of the relief
sought determine which court has jurisdiction.80 In private respondents' 44
paragraphs in their Petition for declaratory relief filed before the Regional Trial
Court, they alleged:cralawlawlibrary
8. On 17 September 2013, without waiting for [Executive Order] No. 140's
effectivity on 2 October 2013, the [Bureau of Customs] issued [Customs Personnel
Order] No. B-189-2013, signed by [Bureau of Customs] Commissioner Rozzano
Rufino B. Biazon and approved by [Department of Finance] Secretary, Cesar V.
Purisima on even date. [Customs Personnel Order] No. B-189-2013
states:cralawlawlibrary
Under Section 3 of Executive Order No. 140, series of 2013, the Customs Policy
Research Office (the "CPRO") shall be composed of its organic personnel,
augmented and reinforced by personnel from the Department of Finance and
Bureau of Customs as well as those (sic) detailed or seconded from other
agencies. Pursuant to the foregoing, the following personnel are detailed from the
Bureau of Customs to [the Customs Policy Research Office] under the Department
of Finance:ChanRoblesvirtualLawlibrary
....
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9. Thus, [private respondents'] original and permanent appointments in plantilla
positions as Collectors of Customs VI and V were effectively and constructively
revoked even before the effectivity of [Executive Order] No. 140 creating the
[Customs Policy Research Office].
They are all "detailed" to the [Customs Policy Research Office] without any
appointment papers providing for their specific functions, status, salary grades,
ranks, and designation. By virtue of the assailed issuance, [private
respondents'] were all removed from their respective permanent positions as
Collectors of Customs to form a supposed "research body."
10. The Department of Budget and Management (DBM), pursuant to [Executive
Order] No. 140 has not even approved the composition of the organic personnel of
the [Customs Policy Research Office]. Neither has the [Department of Finance]
appeared to. have made the requisite recommendation for that purpose, as
mandated by [Executive Order] No. 140.
11. While they have not been officially notified thereof, [private respondents] were
reliably informed of the issuance of [Customs Personnel Order] No. B-189-2013
and [petitioners'] attempt to unlawfully "detail" them to the [Customs Policy
Research Office].
....
13. While the [Bureau of Customs] Commissioner's authority to reorganize is
recognized, it is neither absolute nor unbridled. The exercise thereof should not
violate the law and the 1987 Constitution. The Constitution clearly mandates that
"no officer or employee of the civil service shall be removed or suspended except
for cause provided by law."
14. Section 703 of [Republic Act] No. 1937, as amended, provides
that:cralawlawlibrary
Assignment of Customs Officers and Employees to other duties. - The
Commissioner of Customs may, with the approval of the Secretary of Finance,
assign any employee of the Bureau of Customs to any port, service, division or
office within the Bureau or assign him duties as the best interest of the service may
require, in accordance with the staffing pattern or organizational set-up as may be
prescribed by the Commissioner of Customs with the approval of the Secretary of
Finance: Provided, that such assignment shall not affect the tenure of office of the
employees nor result in the change of status, demotion in rank and/or deduction of
salary.
15. Section 2 of [Republic Act] No. 6656 [or An Act to Protect the Security of
Tenure of Civil Service Officers and Employees in the Implementation of
Government Reorganization] further provides that due notice and hearing are
required to remove a public officer or employee pursuant to a bona
fide reorganization, viz:cralawlawlibrary
No officer or employee in the career service shall be removed except for a valid
cause and after due notice and hearing. A valid cause for removalexists when,
pursuant to a bona fide reorganization, a position has been abolished or rendered
redundant or there is a need to merge, divide, or consolidate positions in order to
meet the exigencies of the service, or other lawful causes allowed by the Civil
Service Law.
16. Thus, while the necessity and indispensability of reorganization when public
interest demands may be justified, civil service employees, much more career
service officers with permanent appointments like [private respondents], cannot
be removed, suspended, or demoted from office except for cause provided by law.
....
18. In this case, [Customs Personnel Order] No. B-l89-2013 allegedly "detailed" all
15[private respondents], together with 12 other Collectors of Customs, to an
advisory capacity of a policy coordinating body (CPRO) under the guise of
reorganization, thus effectively rendering vacant the 27 positions of collector of
customs throughout the country.
19. Section 8, Rule VII of Civil Service Commission (CSC) Resolution No. 91-
1631, otherwise known as the "Omnibus Civil Service Rules and Regulations,"
provides that a "detail" is "the movement of an employee from one department or
agency to another which is temporary in nature, which does not involve a reduction
in rank, status or salary and does not require the issuance of another
appointment."
20. The patent nullity of [Customs Personnel Order] No. B-189-2013 is readily
apparent since Section 703 of [the Tariff and Customs Code] merely authorizes the
[Bureau of Customs] Commissioner to assign or move [Bureau of Customs]
personnel only within the Bureau. Since the [Customs Policy Research Office] is a
newly created "office" outside of the [Bureau of Customs], the [Bureau of Customs]
Commissioner's issuance of [Customs Personnel Order] No. B-189-2013 which
"details" [private respondents] to the [Customs Policy Research Office] is clearly
an ultra vires act, and is therefore invalid. In fact, the [Bureau of Customs]
Commissioner's own admission proves this ultra vires and invalid issuance,
thus:cralawlawlibrary
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"It is more than a reshuffle because [private respondents] have actually
been transferred to the [Department of Finance], out of the Bureau of Customs"
Biazon said in an ANC interview, confirming news first reported by the Philippine
Daily Inquirer. "Instead of just reassignment [to] another port, they're
basically reassigned to another office."
"After their transfer out of the [Bureau of Customs], the next-in-rank collectors or
division heads are taking over as officers-in-charge of the different ports," he said.
21. There is no bona fide reorganization that took place. [Private
respondents'] mass"detail" to the [Customs Policy Research Office] was without
any clear or definite direction as to their career status and functions. As a
consequence, [private respondents] were intentionally and effectively placed on a
"floating status."
22. Furthermore, [Executive Order] No. 140 clearly provides that the [Customs
Policy Research Office] shall be composed of its organic personnel, and that said
policy research body - after the organization of its own organic personnel - shall
merely be augmented and reinforced by Department of Finance and Bureau of
Customs personnel. Despite the absence of any organic personnel, much less
approval from the Department of Budget and Management or even a
recommendation from the [Department of Finance], [private respondents] have, in
speed haste, already been ordered to be "detailed" by the [Bureau of Customs] to
the [Customs Policy Research Office], and thus, effectively removed from their
current respective permanent positions.
23. The landmark case of Dario v. Mison, et al., where the Supreme Court voided
the personnel reorganization within the [Bureau of Customs], is highly instructive in
this case, thus:cralawlawlibrary
Reorganizations in this jurisdiction have been regarded as valid provided they are
pursued in good faith.
....
24. By no stretch of the imagination can the issuance of [Customs Personnel
Order] No. B-189-2013 be said to have been carried out in good faith. The undue
haste in issuing [Customs Personnel Order] No. B-189-2013 clearly shows that
respondents are attempting to beat the deadline on the COMELEC election ban
on personnel movement from 28 September 2013 to 28 October 2013 due to the
forthcoming Barangay Elections. It cannot be denied that [Executive Order] No.
140, which was signed by the President on 2 September 2013, has yet to take
effect on 2 October 2013, which is 15 days after its publication in two (2)
newspapers of general circulation. On 17 September 2013, however, the [Bureau
of Customs] already issued [Customs Personnel Order] No. B-189-2013, which is
based on [Executive Order] No. 140, and attempted to serve copies thereof to
[respondents] on 26 to 27 September 2013 supposedly just in time before the
COMELEC election ban on personnel movement takes effect on 28 September
2013.
25. More importantly, [Executive Order] No. 140 mandates that the transfer of
[Bureau of Customs] personnel should merely augment or reinforce the organic
personnel of the [Customs Policy Research Office]. Obviously, without any organic
personnel, there is still nothing to augment or reinforce. . . . Hence, [private
respondents'] "detail" to the [Customs Policy Research Office] absent any
compliance with the requirements under [Executive Order] No. 140, was surely
carried out in bad faith, and was meant to illegally remove [private
respondents] from their respective permanent positions, in blatant violation of the
law and the Constitution.
26. It should also be stressed that [private respondents] were appointed as
Collectors of Customs with Position Titles VI and V, with specific functions, duties,
titles, and ranks clearly provided for in their respective appointment papers. In
contrast, their supposed "detail" to the [Customs Policy Research Office] under
[Customs Personnel Order] No. B-189-2013 does not even provide for a definite
period of duty, their titles, new functions, or ranks.
27. Moreover, under CSC Memorandum Circular No. 06-05, otherwise known as
the "Guidelines on Designation" it is clear that:cralawlawlibrary
....
B. Designees can only be designated to positions within the level they are currently
occupying. However, Division Chiefs may be designated to perform the duties of
third level positions
First level personnel cannot be designated to perform the duties of second level
positions.
....
29. The basis of [private respondents'] reassignment or the exigency necessary
to remove them from their positions is likewise inexistent. Such blanket "detail"
relinquishes [private respondents'] permanent positions as Collectors of Customs
without due process and is contrary to their Constitutional right to security of
tenure. Clearly, the disparity between the positions of a Collector of Customs and a
Page 64 of 507
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mere researcher is blatant. Therefore, the transfer from the former to the latter
unmistakeably denotes demotion....
....
30. In the case of Pastor v. City of Pasig, the Supreme Court held that a
reassignment or even detail which is indefinite and which results in a reduction of
rank and status is effectively a constructive dismissal from the service. . . .
....
31. The principles on constructive dismissal clearly find analogous application to
[private respondents]. By definition, constructive dismissal is a quitting because
continued employment is rendered impossible, unreasonable or unlikely; when
there is a demotion in rank or a diminution of pay. The test of constructive
dismissal is whether a reasonable person in the employee's position would have
felt compelled to give up his position under the circumstances. It is an act
amounting to dismissal but is made to appear as if it were not. Constructive
dismissal is therefore a dismissal in disguise. The law recognizes and resolves this
situation in favor of employees in order to protect their rights and interests from the
coercive acts of the employer. Thus, the Supreme Court has ruled that the
management prerogative to transfer an employee "cannot be used as a subterfuge
by the employer to rid himself of an undesirable worker."
32. Evidently, [private respondents'] "detail" to the [Customs Policy Research
Office] operated as a blanket and forced relinquishment of their permanent
positions as Collectors of Customs in violation of their right to security of tenure. In
view thereof, it behooves upon this Honorable Court to correct such abuse of
powers and retain [private respondents] to their rightful ranks.
....
35. ... in accordance with the Supreme Court's ruling in Tañada v. Tuvera, laws
and executive issuances shall take effect after fifteen (15) days following the
completion of their publication in the Official Gazette, or in a newspaper of general
circulation.
36. In this case, [Executive Order] No. 140 was published in the 17 September
2013 issue of the broadsheet newspaper, Manila Bulletin. Thus, following the
above legal standards, it is clear that [Executive Order] No. 140 has yet to take
legal effect on 2 October 2013. In other words, the [Bureau of Customs'] issuance
of [Customs Personnel Order] No. B-189-2013 on 17 September 2013 simply, has
no legal basis, and is therefore premature and patently invalid. To deprive [private
respondents] of their permanent positions as Collectors of Customs and to "detail"
all 15 of them indefinitely as members of a research body on the basis of an invalid
[Bureau of Customs] and [Department of Finance] order are not only illegal but
also unconstitutional for being violative of [private respondents'] right to security of
tenure.
37. An unconstitutional act is not a law; it confers no rights; it imposes no duties; it
affords no protection; it creates no office; it is, in legal contemplation, inoperative,
as if it had not been passed. . . . For these reasons, [Customs Personnel Order]
No. B-189-2013 should be nullified and set aside, and its enforcement enjoined.
38. . . . The consequence [of implementing Customs Personnel Order No. B-189-
2013] that is also readily obvious is the chaos entailed in port operations, the
collection of much needed Government revenues and public service as [private
respondents] perform functions either as District Collectors of all the 17 Collection
Districts in the country, or as Deputy Collectors for administration, assessment and
operation in those different ports.
....
41. It cannot be overemphasized that the issuance of [Customs Personnel Order]
No. B-189-2013 is illegal, and blatantly violates existing law and the Constitution.
As above mentioned, respondents intend to have [Customs Personnel Order] No.
B-189-2013 immediately effective. Thus, there is a manifest urgency for this
Honorable Court to immediately restrain [petitioners] from implementing [Customs
Personnel Order] No. B-189-2013 upon receipt of this petition and before the
matter can be heard on notice. Otherwise, grave injustice and irreparable injury
would be suffered by [private respondents], in that:cralawlawlibrary
(a)[Executive Order] No. 140, on which [Customs Personnel Order] No. B-189-
2013 is based, has yet to take effect upon publication in two (2) newspapers of
general circulation. [Executive Order] No. 140 was published in the 17
September 2013 issue of the Manila Bulletin, hence, it will only take effect on 2
October 2013. [Customs Personnel Order] No. B-189-2013 cannot be given any
effectivity as it is invalid for being blatantly premature and without legal basis;
(b)[Customs Personnel Order] No. B-189-2013 violates [Executive Order] No. 140,
as the latter mandates that the [Department of Finance], with the approval of the
[Department of Budget and Management], has to recommend the composition
of the organic personnel of the [Customs Policy Research Office]. No such
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 recommendation by the [Department of Finance], much less the approval of the
[Department of Budget and Management], has been made. In fact, [Executive
Order] No. 140 provides that the transfer of [Bureau of Customs] personnel
should merely augment or reinforce the organic personnel of the [Customs
Policy Research Office]. Obviously, without any organic personnel, there is still
nothing to augment or reinforce. The [Customs Policy Research Office] is thus
in limbo, as there is yet no organic personnel in place;
(c) [Customs Personnel Order] No. B-189-2013 is also contrary to Section 703 of
[Republic Act] No. 1937, as amended, which provides that "(t)he Commissioner
of Customs may, with the approval of the Secretary of Finance, assign any
employee of the Bureau of Customs to any port, service, division or
office within the Bureau or assign him duties as the best interest of the service
may require." Even Commissioner Biazon, in an interview with [the ABS-CBN
News Channel] admitted that "it is more than a reshuffle because they have
actually been transferred to the [Department of Finance], out of the Bureau of
Customs." The Commissioner of Customs thus committed an illegal and ultra
vires act in "detailing" [private respondents] to the [Customs Policy Research
Office], an office admittedly outside the [Bureau of Customs]; and
(d)[private respondents'] "detail" to the [Customs Policy Research Office] is
[petitioners'] scheme to constructively dismiss and demote [private
respondents]. [Customs Personnel Order] No. B- 189-2013 operates as a
blanket and forced relinquishment of [private respondents'] permanent positions
as Collectors of Customs in violation of their constitutional right to security of
tenure. [Private respondents] are all "detailed" to the [Customs Policy Research
Office] without any appointment papers providing for their specific functions,
status, salary grades, ranks, and designation, thereby intentionally and
effectively placing them on "floating status."
(e)[Private respondents] would be unduly displaced from their permanent positions
with the appointment and/or designation by the [Bureau of Customs] of new
Collectors of Customs.81 (Emphasis supplied, citations omitted)
An examination of the text of the Petition for declaratory relief readily shows that
private respondents originally questioned a personnel action. They essentially
questioned their detail to the Customs Policy and Research Office.
Book V, Title I, Subtitle A, Chapter 5, Section 26 of Executive Order No. 292
defines a personnel action:cralawlawlibrary
SECTION 26. Personnel Actions. — . . .
As used in this Title, any action denoting the movement or progress of personnel in
the civil service shall be known as personnel action. Such action shall include
appointment through certification, promotion, transfer, reinstatement, re-
employment, detail, reassignment, demotion, and separation. (Emphasis supplied)
The assailed Customs Personnel Order No. B-189-2013 is a personnel action
because it details 27 employees from the Bureau of Customs to the Customs
Policy Research Office. It is a movement of personnel in the civil service.
Cases involving personnel actions are within the exclusive jurisdiction of the Civil
Service Commission and not within the trial courts' jurisdiction.82cralawrednad
The issue is not novel.
In Olanda v. Bugayong,83 respondent Leonardo G. Bugayong (Bugayong), as
President of the Philippine Merchant Marine Academy, relieved petitioner
Menelieto A. Olanda (Olanda) from his post as the Dean of the College of Marine
Engineering of the Philippine Merchant Marine Academy84 and imposed a three
(3)-month suspension85 on the latter for allegedly "misusing classified
information."86 Olanda filed before the Regional Trial Court of Iba, Zambales a
Petition for "quo warranto, mandamus, and prohibition with prayer for the issuance
of a writ of preliminary injunction and damages, claiming that there was no valid
cause to deprive him of his position[.]"87cralawrednad
This court ruled that the trial court had no jurisdiction.88 Hence:cralawlawlibrary
Disciplinary cases and cases involving "personnel actions" affecting employees in
the civil service including "appointment through certification, promotion, transfer,
reinstatement, reemployment, detail, reassignment, demotion and separation" are
within the exclusivejurisdiction of the Civil Service Commission which is the sole
arbiter of controversies relating to the civil service.
....
It was thus error for the trial court, which does not have jurisdiction, to, in the first,
[sic] place take cognizance of the petition of petitioner assailing his relief as Dean
and his designation to another position. This leaves it unnecessary to dwell on the
issues herein raised by petitioner.
WHEREFORE, the petition is, upon the ground of lack of jurisdiction of the trial
court, hereby DENIED.
SO ORDERED.89 (Emphasis supplied, citation omitted)
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In Casimina v. Judge Legaspi,90 petitioner Pablo B. Casimina (Casimina), General ....
Manager of the Philippine Fisheries Development Authority, issued Special Order
No. 82, which reassigned private respondent Emmanuel T. Illera (Illera), Port It was thus error, because beyond its competence, for the respondent Trial Court
Manager of the Iloilo Fishing Port Complex, from Iloilo to the central office in to take cognizance of the quo warranto and mandamus action instituted by Dr.
Quezon City.91 After the denial of his request for reconsideration,92 Illera filed for Regino which was in essence a protest against the appointment of Dr.
injunction with a prayer for temporary restraining order and a writ of preliminary Mantala.106 (Emphasis supplied, citations omitted)
injunction against Casimina before the Regional Trial Court of Iloilo "to restrain
In all these cases, this court upheld the jurisdiction of the Civil Service Commission
[Casimina] from transferring him to the central office in Quezon over complaints involving the movement of personnel in the civil service.
City."93cralawrednad
II.
Casimina filed an Omnibus Motion to dismiss the Complaint on the ground of,
among others, lack of jurisdiction.94 This court ruled that the trial court has no
The doctrine of primary administrative jurisdiction precludes trial courts from
jurisdiction over the Petition.95 "[T]his case falls within the jurisdiction of the Civil
resolving a controversy involving a question that is within the a exclusive
Service Commission (CSC) because it involves the movement of government
jurisdiction of an administrative tribunal.107 The doctrine disallows courts "to
personnel to promote order and efficiency in public service."96cralawrednad
arrogate unto itself the authority to resolve a controversy the jurisdiction over which
is initially lodged with an administrative body of special
In Mantala v. Salvador,97 Dr. Julia P. Regino (Regino) filed a formal protest before
competence."108cralawrednad
the Committee on Evaluation and Protest of the Department of Health questioning
the appointment of Dr. Mariquita J. Mantala (Dr. Mantala).98 The Committee on
In Pambujan Sur United Mine Workers v. Samar Mining Company, Inc.,109 the
Evaluation and Protest upheld Dr. Mantala's appointment.99Upon appeal and
plaintiff Pambujan Sur United Mine Workers filed a Complaint before the Court of
reconsideration, the Civil Service Commission also upheld Dr. Mantala's
First Instance (now Regional Trial Court) against the Samar Mining Company, Inc.
appointment.100 The Resolution of the Civil Service Commission became final and
(Samar Mining) alleging breach of their closed-shop agreement.110 Samar Mining
executory.101 Regino then filed an action for quo warranto and mandamus before
filed a Motion to Dismiss arguing that the regular courts had no jurisdiction over the
the Regional Trial Court in Quezon City.102The trial court annulled and set aside
subject matter of the Complaint.111 Samar Mining argued that the Court of
Dr. Mantala's appointment and directed the Secretary of Health to withdraw Dr.
Industrial Relations (now National Labor Relations Commission) had jurisdiction
Mantala's appointment and to issue another for Regino.103 Dr. Mantala then filed a
over cases involving conditions of employment.112 The Court of First Instance
Petition for Review on certiorari before this court.104 This court granted the Petition
granted the Motion to Dismiss.113cralawrednad
and annulled the Decision of the trial court:105
Disciplinary cases, and cases involving "personnel actions" affecting employees in
Upon appeal, this court applied the "exclusion theory," 114 i.e., "where jurisdiction is
the civil service—including "appointment through certification, promotion, transfer,
conferred in express terms upon one court, and not upon another [and where] it
reinstatement, reemployment, detail, reassignment, demotion and separation,"
has been held that it is the intention that the jurisdiction conferred shall be
and, of course, employment status and qualification standards—are within the
exclusive"115 and upheld the exclusive jurisdiction of the Court of Industrial
exclusive jurisdiction of the Civil Service Commission. The Constitution declares
Relations (now National Labor Relations Commission).116 Hence:cralawlawlibrary
the Commission to be "the central personnel agency of the Government," having
But judicial wisdom in this particular matter would seem to favor adherence to the
power and authority to administer the civil service; to promulgate its own rules
exclusion theory, what with the litigant's ordinary duty to exhaust administrative
concerning pleadings and practice before it or before any of its offices; and to
remedies and the "doctrine of primary administrative jurisdiction," sense-making
render decision in "any case or matter brought before it within sixty days from the
and expedient,
date of its submission for decision or resolution," which decision, or order or ruling
"That the courts cannot or will not determine a controversy involving a question
"may be brought to the Supreme Court on certiorari by the aggrieved party within
which is within the jurisdiction of an administrative tribunal prior to the decision of
thirty days from receipt of a copy thereof."
that question by the administrative tribunal, where the question demands the
exercise of sound administrative discretion requiring the special knowledge,
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experience, and services of the administrative tribunal to determine technical and
intricate matters of fact, and a uniformity of ruling is essential to comply with the
purposes of the regulatory statute administered." (42 Am. Jut., 698.)117
This court also made a similar ruling in Javier v. Court of Appeals.118 In Javier,
Normito Javier (Normito) was "employed by private respondent Jebsens Maritime,
Inc. as a boatswain[.]"119 Normito, however, died at sea.120 Upon learning of her
husband's death, Lolita Javier (Lolita) went to the office of Jebsens Maritime, Inc.
and the latter "promised to give the corresponding death benefits[.]"121 After
Jebsens Maritime, Inc. had failed to pay the promised death benefits, Lolita filed a
Complaint before the Regional Trial Court of Makati for a sum of money for herself
and on behalf of her six (6) minor children against Jebsens Maritime, Inc. and its
shipmaster.122cralawrednad
This court ruled that under Section 3(d)123 of Executive Order No. 247 or the
Reorganization Act of the Philippine Overseas Employment Administration, it was
the Philippine Overseas Employment Administration that had original and
exclusive jurisdiction over Lolita's Complaint and that the trial court had no
jurisdiction over the subject matter of her Complaint.124 Hence, under the doctrine
of primary administrative jurisdiction, the trial court cannot resolve the
controversy.125cralawred This court ordered the Regional Trial Court to dismiss the
case for lack of jurisdiction.126cralawrednad
In Catipon, Jr. v. Japson,127 respondent Jerome Japson (Japson), "a former Senior
Member Services Representative of [the] [Social Security System,] Bangued, filed
a letter-complaint [before] the Civil Service Commission-[Cordillera Administrative
Region] Regional Director[.]"128 He alleged that petitioner Macario U. Catipon, Jr.
(Catipon) made deliberate false entries in his application to take the Civil Service
Professional Examination.129 The Civil Service Commission-Cordillera
Administrative Region Regional Director found Catipon guilty of conduct prejudicial
to the best interest of the service.130cralawrednad
Catipon appealed to the Court of Appeals, which dismissed the appeal. 131 The
Court of Appeals held that instead of filing the appeal before the Court of Appeals,
Catipon should have appealed to the Civil Service Commission, based on Sections
5(A)(1),132 43,133 and 49134 of the Civil Service Commission Uniform Rules on
Administrative Cases.135cralawrednad
This court affirmed the Decision of the Court of Appeals136 and
held:cralawlawlibrary
The [Court of Appeals] is further justified in refusing to take cognizance of the
petition for review, as "[t]he doctrine of primary jurisdiction does not warrant a court
to arrogate unto itself the authority to resolve a controversy the jurisdiction over
which is initially lodged with an administrative body of special competence." When
petitioner's recourse lies in an appeal to the Commission Proper in accordance
with the procedure prescribed in [Revised Uniform Rules on Administrative Cases
in the Civil Service], the [Court of Appeals] may not be faulted for refusing to
acknowledge petitioner before it.137 (Emphasis supplied)
Hence, considering the exclusive jurisdiction of the Civil Service Commission to
hear and decide administrative cases, including those involving personnel actions,
as granted by the Constitution, the Regional Trial Court cannot assume jurisdiction
based on the doctrine of primary administrative jurisdiction.
In sustaining the trial court's assumption of jurisdiction over the Petition for
declaratory relief, the ponencia held that the case falls under an exception to the
doctrine of exhaustion of administrative remedies.138 The ponencia
states:cralawlawlibrary
In this case, respondents allege that [Customs Personnel Order No. B-189-2013]
is contrary to law and unconstitutional. Respondents assail [Customs Personnel
Order No. B-189-2013] as patently illegal, arbitrary, and oppressive. This case
clearly falls within the exceptions where exhaustion of administrative remedies
need not be resorted to by respondents.139
Private respondents, citing Kilusang Bayan sa Paglilingkod ng mga Magtitinda ng
Bagong Pamilihang Bayan ng Muntinlupa, Inc. (KBMBPM) v.
Dominguez,140 likewise argue that exceptions to the doctrine of exhaustion of
administrative remedies apply.141 Hence:cralawlawlibrary
Moreover, the doctrine of exhaustion of administrative remedies also yields to
other exceptions, such as when the question involved is purely legal, as in the
instant case, or where the questioned act is patently illegal, arbitrary or
oppressive.142
The doctrine of exhaustion of administrative remedies does not apply and,
consequently, its exceptions.
The doctrine of primary administrative jurisdiction is different from the doctrine of
exhaustion of administrative remedies.
Under the doctrine of primary administrative jurisdiction, when an administrative
agency is granted primary jurisdiction over the subject matter, the courts "cannot
or will not determine a controversy involving a question which is within the
jurisdiction of an administrative tribunal prior to the decision of that question by the
administrative tribunal[.]"143 The doctrine of primary administrative jurisdiction
presupposes that the administrative agency has jurisdiction over the subject matter
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while the court does not. The Complaint or Petition, therefore, cannot be filed
before the court. As the issue is jurisdictional, there should be no exception to the
doctrine of primary administrative jurisdiction. When the complaint or petition is
filed before a court with no subject matter jurisdiction, the court has no other option
but to dismiss the case.144cralawrednad
On the other hand, under the doctrine of exhaustion of administrative remedies,
before a party may seek intervention from the court, he or she should have already
exhausted all the remedies in the administrative level.145 If there is still a remedy
available within the administrative machinery, "then such remedy should be
exhausted first before [the] court's judicial power can be sought." 146 The doctrine of
exhaustion of administrative remedies presupposes that both the courts and the
administrative agency have concurrent jurisdiction. This is because non-
observance of the doctrine of exhaustion of administrative remedies does not
affect the court's jurisdiction.147 In Soto v. Jareno,148this court
ruled:cralawlawlibrary
Failure to observe the doctrine of exhaustion of administrative remedies does not
affect the jurisdiction of the court. We have repeatedly stressed this in a long line
of decisions. The only effect of non-compliance with this rule is that it will deprive
the complainant of a cause of action, which is a ground for a motion to dismiss. If
not invoked at the proper time, this ground is deemed waived and the court can
then take cognizance of the case and try it.149 (Emphasis supplied)
Hence, the doctrine of exhaustion of administrative remedies presupposes that the
court has jurisdiction over the subject matter of the complaint or petition.
Otherwise, it can never have the power to take cognizance of the case as
contemplated by Soto.
While both the court and the administrative agency have jurisdiction over the
subject matter, the general rule is that the courts, because of comity, practicality,
and convenience, will not interfere with the administrative process until the process
comes to an end.150 This is because availing administrative remedies entails lesser
expenses and results in a speedier resolution of controversies. 151 On the other
hand, since the court and the administrative agency have concurrent jurisdiction,
exceptions may be warranted by the circumstances,152 and the court may choose
to assume jurisdiction over the controversy.
Hence, when jurisdiction is exclusively granted to an administrative agency, the
doctrine of exhaustion of administrative remedies does not apply. Here,
considering that the Civil Service Commission is granted exclusive jurisdiction over
cases involving personnel actions, the doctrine of primary administrative
jurisdiction, not the doctrine of exhaustion of administrative remedies, applies.
The exceptions to the doctrine of exhaustion of administrative remedies likewise
do not apply because the Regional Trial Court has no jurisdiction to resolve the
dispute in the first place. In order for the exceptions to apply, the court to which the
petition was prematurely filed should have jurisdiction; otherwise, the orders of the
court would be null and void for lack of jurisdiction. Decisions or orders rendered
by tribunals and agencies that do not have subject matter jurisdiction are null and
void.153Hence, the exceptions to the doctrine of exhaustion of administrative
remedies should not be applicable since the Regional Trial Court, the court to
which the Petition for declaratory relief was filed, lacks subject matter jurisdiction,
and any order or decision rendered by it would be null and void.
Kilusang Bayan sa Paglilingkod ng mga Magtitinda ng Bagong Pamilihang Bayan
ng Muntinlupa, Inc. (KBMBPM) cited by private respondents finds no application
here. In KBMBPM, petitioners questioned the takeover by the Department of
Agriculture of the management of petitioner KBMBPM, a service cooperative
organized by and composed of vendors of the New Muntinlupa Public
Market.154 There is no personnel action involved in KBMBPM. Hence, private
respondents' reliance on the case is misplaced.
The ponencia held that "[w]hen respondents raised the issue of validity and
constitutionality of [Customs Personnel Order No. B-189-2013], the issue took the
case beyond the scope of the [Civil Service Commission's] jurisdiction because the
matter is no longer limited to personnel action. Thus, the [Regional Trial Court] did
not abuse its discretion in taking cognizance of the action."155cralawrednad
The constitutional issues alleged in the Petition for declaratory relief do not suffice
for the Regional Trial Court to assume jurisdiction.
The Civil Service Commission cannot be ousted from its jurisdiction "by the simple
expediency of appending an allegedly constitutional or legal dimension to an
issue"156 that clearly involves a personnel action.157cralawrednad
In Corsiga v. Judge Defensor,158 petitioner Eduardo Corsiga (Corsiga), "then
Regional Irrigation Manager of the [National Irrigation Administration], Region VI,
issued Regional Office Memorandum (ROM) No. 52, reassigning private
respondent [Romeo Ortizo (Ortizo)] to [the] Aganan-Sta. Barbara River Irrigation
System[.]"159 Ortizo filed before the "Regional Trial Court of Iloilo City a complaint
for prohibition and injunction, with prayer for issuance of [a] Temporary Restraining
Order and/or Writ of Preliminary Injunction."160 He argued that the transfer or
assignment without his consent is a violation of his constitutional right to security of
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tenure.161 Corsiga moved to dismiss the Petition for lack of
jurisdiction.162cralawrednad
This court ruled that the Regional Trial Court had no jurisdiction over Ortizo's
Complaint.163 Hence:cralawlawlibrary
It is the intent of the Civil Service Law, in requiring the establishment of a
grievance procedure in Rule XII, Section 6 of the same rules, that decisions of
lower level officials be appealed to the agency head, then to the Civil Service
Commission. Decisions of the Civil Service Commission, in turn, may be elevated
to the Court of Appeals. Under this set up, the trial court does not have
jurisdiction over personnel actions and, thus, committed an error in taking
jurisdiction over Civil Case No. 22462. The trial court should have dismissed the
case on motion of petitioner and let private respondent question RMO[sic] No. 52
before the NIA Administrator, and then the Civil Service Commission. As held in
Mantala vs. Salvador, cases involving personnel actions, reassignment included,
affecting civil service employees, are within the exclusive jurisdiction of the Civil
Service Commission.164 (Emphasis supplied, citations omitted)
Despite allegations of Regional Office Memorandum No. 52's constitutional
infirmities, this court still upheld the exclusive jurisdiction of the Civil Service
Commission over cases involving personnel actions.
In Department of Agrarian Reform v. Trinidad Valley Realty & Development
Corporation,165 Trinidad Valley Realty & Development Corporation and the other
respondents (Trinidad Valley Realty & Development Corporation, et al.) are
registered owners of a parcel of land in Negros Oriental.166 The Department of
Agrarian Reform placed a substantial portion of the land under the coverage of the
Comprehensive Agrarian Reform Law of 1988 or Republic Act No.
6657.167 Administrative Order No. 10, Series of 1989, Administrative Orders No.
12, Series of 1989, No. 9, Series of 1990, and No. 2, Series of 1996,
Administrative Order No. 10, Series of 1990, Joint DAR-LRA Memorandum
Circular No. 20, Series of 1997, and Executive Order No. 405, among others,
(collectively, Orders) were then issued.168cralawrednad
Private respondents Trinidad Valley Realty & Development Corporation, et al. filed
before the Regional Trial Court a Petition for declaration of unconstitutionality
through certiorari, prohibition and mandamus against the Land Registration
Authority, the Department of Agrarian Reform, and the beneficiaries under the
Comprehensive Agrarian Reform Program questioning the Orders.169 This was
later amended to an ordinary action of annulment of land titles.170 In its Answer,
the Department of Agrarian Reform asserted that "jurisdiction over all agrarian
reform matters is exclusively vested in the [Department of Agrarian
Reform,]"171 not in the regular courts. This court ruled that the Regional Trial Court
had no jurisdiction.172
The Court likewise ruled in the similar case of [Department of Agrarian Reform] v.
Cuencathat "[a]ll controversies on the implementation of the Comprehensive
Agrarian Reform Program (CARP) fall under the jurisdiction of the Department of
Agrarian Reform (DAR), even though they raise questions that are also legal
or constitutional in nature." In said case, it was noted that the main thrust of the
allegations in the Complaint was the propriety of the Notice of Coverage and "not x
x x the 'pure question of law' spawned by the alleged unconstitutionality of EO 405
— but x x x the annulment of the DAR's Notice of Coverage." The Court thus held
that:cralawlawlibrary
To be sure, the issuance of the Notice of Coverage constitutes the first necessary
step towards the acquisition of private land under the CARP. Plainly then, the
propriety of the Notice relates to the implementation of the CARP, which is under
the quasi-judicial jurisdiction of the DAR. Thus, the DAR could not be ousted
from its authority by the simple expediency of appending an allegedly
constitutional or legal dimension to an issue that is clearly agrarian.
The legal recourse undertaken by Trinidad Valley Realty and Development
Corporation, et al. is on all-fours with the remedy adopted by the private
respondents in Cuenca. In this case, Trinidad Valley Realty and Development
Corporation, et al. cloaked the issue as a constitutional question — assailing the
constitutionality of administrative issuances promulgated to implement the agrarian
reform law — in order to annul the titles issued therein. In Cuenca, private
respondents assailed the constitutionality of EO 45 in order to annul the Notice of
Coverage issued therein. The only difference is that in Cuenca, private
respondents directly filed with the RTC their complaint to obtain the aforesaid
reliefs while in this case, Trinidad Valley Realty and Development Corporation, et
al. filed their original petition for certiorari with the RTC after the protest of Trinidad
Valley Realty and Development Corporation against the coverage of its
landholding under CARP was dismissed by the DAR Regional Director and such
dismissal was affirmed by DAR OIC Secretary Jose Mari B. Ponce. But in both
cases, it is evident that the constitutional angle was an attempt to exclude the
cases from the ambit of the jurisdictional prescriptions under RA
6657.173 (Emphasis supplied, citations omitted)
Invocations of issues of validity and constitutionality of Customs Personnel Order
No. B-189-2013 will not suffice for the courts to assume jurisdiction, if the order
sought to be declared invalid is a personnel action. Since the questioned order is a
personnel action, the exclusive jurisdiction of the Civil Service Commission as the
sole arbiter of controversies relating to the civil service must be upheld.
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In any case, detail of government personnel to other offices does not involve and
violate the employees' security of tenure in the absence of any grave abuse of
discretion or improper motive or purpose.174cralawrednad
Hence, the Regional Trial Court has no jurisdiction over private respondents'
Petition for declaratory relief.
IV.
Private respondents rely on Commissioner of Customs, et al. v. Hypermix Feeds
Corporation.175 They argue that based on Hypermix, "[t]he determination of
whether a specific rule or set of rules issued by an administrative agency
contravenes the law or the [Constitution is within the jurisdiction of the regular
courts."176 They add that the "Constitution vests the power of judicial review or the
power to declare a law, treaty, international or executive agreement, presidential
decree, order, instruction, ordinance, or regulation in the courts, including the
regional trial courts."177cralawrednad
In Hypermix, Hypermix Feeds Corporation filed a Petition for declaratory relief
before the Regional Trial Court, with the Petition challenging the validity and
constitutionality of Customs Memorandum Order (CMO) 27-2003.178 CMO 27-2003
classified wheat according to (1) importer or consignee; (2) country of origin; and
(3) port of discharge, and imposed different tariff rates depending on such
classification.179This court concluded that "a petition for declaratory relief is the
right remedy given the circumstances of the case."180Hypermix cannot be applied
because the circumstances in that case differ from the circumstances here
as Hypermix does not involve a personnel action.
V.
A petition for declaratory relief may prosper only if there is no breach or violation
yet of the assailed government regulation, and adequate relief is not available
through other means or other forms of action or proceeding.
Rule 63, Section 1 of the Rules of Court provides:cralawlawlibrary
SECTION 1. Who may file petition. - Any person interested under a deed, will,
contract or other written instrument, or whose rights are affected by a statute,
executive order or regulation, ordinance, or any other governmental regulation
may, before breach or violation thereof, bring an action in the appropriate Regional
Trial Court to determine any question of construction or validity arising, and for a
declaration of his rights or duties, thereunder. (Emphasis supplied)
In Republic v. Roque,181 this court enumerated the requisites for a petition for
declaratory relief to prosper:cralawlawlibrary
Case law states that the following are the requisites for an action for declaratory
relief: first, the subject matter of the controversy must be a deed, will, contract or
other written instrument, statute, executive order or regulation, or
ordinance; second, the terms of said documents and the validity thereof are
doubtful and require judicial construction; third, there must have been no breach
of the documents in question; fourth, there must be an actual justiciable
controversy or the "ripening seeds" of one between persons whose interests are
adverse; fifth, the issue must be ripe for judicial determination; and sixth,
adequate relief is not available through other means or other forms of action or
proceeding.182 (Emphasis in the original, citation omitted)
The third and sixth requisites are absent. The Complaint before the lower court did
not simply ask for a declaration of a hypothetical breach. Adequate relief through
the Civil Service Commission was also available.
Executive Order No. 140 was published on September 17, 2013. According to
Section 9, Executive Order No. 140 shall take effect immediately. On September
17, 2013, Bureau of Customs Commissioner Rozzano Rufmo B. Biazon issued
Customs Personnel Order No. B-189-2013. On September 30, 2013, private
respondents filed their Petition for declaratory relief. There was no denial by
private respondents that they did not report for work upon Custom Personnel
Order No B-189-2013's effectivity.183 Private respondents Arnel C. Alcaraz, Ma.
Lourdes V. Mangaoang, Romalino G. Valdez, Lilibeth S. Sandag, Ma. Liza S.
Torres, and Raymond P. Ventura only reported for work after the trial court's denial
of their application for a writ of preliminary injunction.184cralawrednad
By not reporting for work upon the issuance of Customs Personnel Order No. B-
189-2013 on September 17, 2015, private respondents committed a breach of the
Order. Since they committed the breach prior to the filing of their Petition for
declaratory relief, the petition is no longer available.
In Martelino, et al. v. National Home Mortgage Finance Corporation, et
al.,185 petitioners (Martelino, et al.) obtained housing loans from respondents
National Home Mortgage Finance Corporation and Home Development Mutual
Fund.186 National Home Mortgage Finance Corporation and Home Development
Mutual Fund directly released the proceeds of the housing loans to the subdivision
developer, Shelter Philippines, Inc. (Shelter).187cralawrednad
Shelter did not complete the subdivision pursuant to its subdivision
plan.188 Martelino, et al. then filed a Petition for declaratory relief to determine
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whether they can suspend payment to National Home Mortgage Finance
Corporation and Home Development Mutual Fund because of Shelter's failure to
complete the subdivision and whether interests and penalties should also be
suspended.189cralawrednad
This court found that at the time of the filing of their Petition for declaratory relief,
Martelino, et al. already suspended payment of their amortizations to National
Home Mortgage Finance Corporation and Home Development Mutual
Fund.190 Hence, this court concluded that the Regional Trial Court cannot assume
jurisdiction over the Petition for declaratory relief.191 Hence:cralawlawlibrary
Indeed, under Section 1, Rule 63, a person must file a petition for declaratory relief
before breach or violation of a deed, will, contract, other written instrument, statute,
executive order, regulation, ordinance or any other governmental regulation. In this
case, the petitioners had stated in their petition that respondents assessed them
interest and penalties on their outstanding loans, initiated foreclosure proceedings
against petitioner Rafael Martelino as evidenced by the notice of extra-judicial sale
and threatened to foreclose the mortgages of the other petitioners, all in disregard
of their right to suspend payment to Shelter for its failure to complete the
subdivision. Said statements clearly mean one thing: petitioners had already
suspended paying their amortization payments. Unfortunately, their actual
suspension of payments defeated the purpose of the action to secure an
authoritative declaration of their supposed right to suspend payment, for their
guidance. Thus, the RTC could no longer assume jurisdiction over the action for
declaratory relief because its subject initially unspecified, now identified as P.D.
No. 957 and relied upon — correctly or otherwise — by petitioners, and assumed
by the RTC to be Rep. Act No. 8501, was breached before filing the action. As we
said in Tambunting, Jr. v. Sumabat:cralawlawlibrary
. . . The purpose of the action [for declaratory relief] is to secure an authoritative
statement of the rights and obligations of the parties under a statute, deed,
contract, etc. for their guidance in its enforcement or compliance and not to settle
issues arising from its alleged breach. It may be entertained only before the breach
or violation of the statute, deed, contract, etc. to which it refers. Where the law or
contract has already been contravened prior to the filing of an action for
declaratory relief, the court can no longer assume jurisdiction over the action....
Under such circumstances, inasmuch as a cause of action has already accrued in
favor of one or the other party, there is nothing more for the court to explain or
clarify short of a judgment or final order.192 (Emphasis supplied, citations omitted)
In Aquino v. Municipality of Malay, Aklan,193 petitioner Crisostomo B. Aquino
(Aquino) is "the president and chief executive officer of Boracay Island West Cove
Management Philippines, Inc. (Boracay West Cove)."194 The Office of the Mayor of
Malay, Aklan issued Executive Order No. 10, Series of 2011, ordering the closure
and demolition of a hotel owned by Boracay West Cove.195 On June 10, 2011,
Executive Order No. 10 was implemented partially. 196cralawrednad
To stop the implementation of Executive Order No. 10, Aquino filed a Petition for
certiorari with prayer for injunctive relief before the Court of Appeals.197 The Court
of Appeals dismissed the Petition on the ground that the correct remedy was for
Aquino "to file a petition for declaratory relief with the Regional Trial
Court."198cralawrednad
This court disagreed with the Court of Appeals and stated:cralawlawlibrary
An action for declaratory relief presupposes that there has been no actual breach
of the instruments involved or of the rights arising thereunder. Since the purpose of
an action for declaratory relief is to secure an authoritative statement of the rights
and obligations of the parties under a statute, deed, or contract for their guidance
in the enforcement thereof, or compliance therewith, and not to settle issues
arising from an alleged breach thereof, it may be entertained before the breach or
violation of the statute, deed or contract to which it refers. A petition for declaratory
relief gives a practical remedy for ending controversies that have not reached the
state where another relief is immediately available; and supplies the need for a
form of action that will set controversies at rest before they lead to a repudiation of
obligations, an invasion of rights, and a commission of wrongs.
In the case at bar, the petition for declaratory relief became unavailable by
[Executive Order No. 10's] enforcement and implementation. The closure and
demolition of the hotel rendered futile any possible guidelines that may be issued
by the trial court for carrying out the directives in the challenged [Executive Order
No. 10]. Indubitably, the CA erred when it ruled that declaratory relief is the proper
remedy given such a situation.199(Emphasis supplied, citation omitted)
In City of Lapu-Lapu v. Philippine Economic Zone Authority,200 the City of Lapu-
Lapu and the Province of Bataan demanded from the Philippine Economic Zone
Authority payment of real property taxes.201 The Philippine Economic Zone
Authority filed a Petition for declaratory relief before the Regional Trial Court,
"praying that the trial court declare it exempt from payment of real property
taxes."202 This court ruled that the Regional Trial Court had no jurisdiction to
decide Philippine Economic Zone Authority's Petition for declaratory relief. 203 This
court explained:cralawlawlibrary
We rule that the [Philippine Economic Zone Authority] erred in availing itself of a
petition for declaratory relief against the City. The City had already issued demand
letters and real property tax assessment against the [Philippine Economic Zone
Authority], in violation of the [Philippine Economic Zone Authority's] alleged tax-
exempt status under its charter.The Special Economic Zone Act of 1995, the
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subject matter of [Philippine Economic Zone Authority's] petition for declaratory
relief, had already been breached. The trial court, therefore, had no
jurisdiction over the petition for declaratory relief.
There are several aspects of jurisdiction. Jurisdiction over the subject matter is
"the power to hear and determine cases of the general class to which the
proceedings in question belong." It is conferred by law, which may either be the
Constitution or a statute. Jurisdiction over the subject matter means "the nature of
the cause of action and the relief sought." Thus, the cause of action and character
of the relief sought as alleged in the complaint are examined to determine whether
a court had jurisdiction over the subject matter. Any decision rendered by a court
without jurisdiction over the subject matter of the action is void.204 (Emphasis
supplied, citations omitted)
Further, Tambunting, Jr. v. Spouses Sumabat205 declared that when a court
assumed jurisdiction over a Petition for declaratory relief when there was already a
breach of the subject instrument or government regulation, the orders made by
that court would be null and void for want of jurisdiction.206 Hence:cralawlawlibrary
In other words, a court has no more jurisdiction over an action for declaratory
relief if its subject, i.e., the statute, deed, contract, etc., has already been
infringed or transgressed before the institution of the action. Under such
circumstances, inasmuch as a cause of action has already accrued in favor of one
or the other party, there is nothing more for the court to explain or clarify short of a
judgment or final order.
Here, an infraction of the mortgage terms had already taken place before the filing
of Civil Case No. C-7496. Thus, the CFI lacked jurisdiction when it took
cognizance of the case in 1979. And in the absence of jurisdiction, its decision
was void and without legal effect. As this Court held in Arevalo v.
Benedicto:cralawlawlibrary
Furthermore, the want of jurisdiction by a court over the subject-matter renders its
judgment void and a mere nullity, and considering that a void judgment is in legal
effect no judgment, by which no rights are divested, from which no rights can be
obtained, which neither binds nor bars any one, and under which all acts
performed and all claims flowing out of are void, and considering further, that the
decision, for want of jurisdiction of the court, is not a decision in contemplation of
law, and, hence, can never become executory, it follows that such a void judgment
cannot constitute a bar to another case by reason of res judicata.207 (Emphasis
supplied, citations omitted)
This was reiterated in Malana, et al. v. Tappa, et al.208 where this court
declared:cralawlawlibrary
Where the law or contract has already been contravened prior to the filing of an
action for declaratory relief, the courts can no longer assume jurisdiction over the
action. In other words, a court has no more jurisdiction over an action for
declaratory relief if its subject has already been infringed or transgressed before
the institution of the action.209
Private respondents argue that Customs Personnel Order No. B-189-2013 is void,
producing no effect. Hence, "there is actually no breach, real or imaginary, to
speak of in this case."210cralawrednad
Subscribing to petitioners' theory will render ineffective the phrase before breach
or violation thereof found in Section 1 of Rule 63 of the Rules of Court when a
petitioner questions the validity of a written instrument or governmental regulation.
By arguing that the instrument or regulation questioned is void at the onset, a
petitioner may file any time a petition for declaratory relief with no regard to
whether he or she violated the "void" instrument or regulation.
Private respondents' belated compliance with Customs Personnel Order No. B-
189-2013 cannot cure the defect of want of jurisdiction. In Gomez v. Palomar, etc.,
et al.,211 this court declared:cralawlawlibrary
The prime specification of an action for declaratory relief is that it must be brought
"before breach or violation" of the statute has been committed. Rule 64, section 1
so provides. Section 6 of the same rule, which allows the court to treat an action
for declaratory relief as an ordinary action, applies only if the breach or violation
occurs after the filing of the action but before the termination thereof.
Hence, if, as the trial court itself admitted, there had been a breach of the statute
before the filing of this action, then indeed the remedy of declaratory relief cannot
be availed of much less can the suit be converted into an ordinary
action.212 (Emphasis supplied, citation omitted)
Considering that there was already a breach of Customs Personnel Order No. B-
189-2013 when private respondents filed their Petition for declaratory relief, the
Regional Trial Court can no longer act on the Petition for want of jurisdiction.
For a Petition for declaratory relief to prosper, there should be no other adequate
relief available to petitioners.213 "If adequate relief is available through another form
of action or proceeding, the other action must be preferred over an action for
declaratory relief."214cralawrednad
In Ferrer, Jr., et al. v. Mayor Roco, Jr., et al.,215 this court affirmed the dismissal of
a Petition for declaratory relief where the doctrine of primary administrative
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jurisdiction applied because it meant that there was another adequate remedy
available to petitioners.216cralawrednad
Here, private respondents' correct remedy was to file a Complaint or Petition
before the Civil Service Commission to assail their detail to the Customs Policy
Research Office. Since they have another adequate remedy available to them,
their Petition for declaratory relief must fail.
All told, a Petition for declaratory relief was not an available remedy for private
respondents. It was, therefore, error for the Regional Trial Court to assume
jurisdiction over private respondents' Petition for declaratory relief. The Orders of
the Regional Trial Court dated October 1, 2013, October 4, 2013, and October 21,
2013 are declared void for want of jurisdiction. All other Orders of the Regional
Trial Court pursuant to private respondents' Petition for declaratory relief are also
void for lack of jurisdiction.
The Regional Trial Court should be directed to dismiss private respondents'
Petition for declaratory relief.
VI.
Customs Personnel Order No. B-189-2013 provides that it "shall be effective
immediately and valid until sooner revoked."217cralawrednad
Civil Service Commission Resolution No. 021181 entitled Policies on Detail and
dated September 13, 2002 "govern[s] the detail of employees in all agencies of the
government."218 Section 2 of Policies on Detail provides:cralawlawlibrary
Section 2. Duration of the Detail - the detail shall be allowed only for a maximum
period of one year. Details beyond one year may be allowed provided it is with the
consent of the detailed employee. The extension or renewal of the period of the
detail shall be within the authority of the mother agency.
If the employee believes that there is no justification for the detail, he/she may
appeal his/her case to the proper Civil Service Commission Regional
Office. Pending appeal, the detail shall be executory unless otherwise ordered by
said regional office. Decision of said regional office may be further appealed to the
Commission en banc.219 (Emphasis supplied)
Customs Personnel Order No. B-189-2013 's provision stating that "[t]his Order
shall be effective immediately and valid until sooner revoked" appears contrary to
Section 2 of Resolution No. 02-1181. Pursuant, however, to Section 2 of Civil
Service Commission Resolution No. 02-1181, Customs Personnel Order No. B-
189-2013 should be read as valid only for a period of one (1) year. Consistency in
executive issuances is of utmost importance.220 As much as possible, it is the duty
of the courts to harmonize and reconcile them.221cralawrednad
In Philippine International Trading Corporation v. Presiding Judge Angeles,222 this
court ruled:cralawlawlibrary
Thus, there is no real inconsistency between LOI 444 and EO 133. There is,
admittedly, a rearranging of the administrative functions among the administrative
bodies affected by the edict, but not an abolition of executive power. Consistency
in statutes as in executive issuances, is of prime importance, and, in the absence
of a showing to the contrary, all laws are presumed to be consistent with each
other. Where it is possible to do so, it is the duty of courts, in the construction of
statutes, to harmonize and reconcile them, and to adopt a construction of a
statutory provision which harmonizes and reconciles it with other statutory
provisions. The fact that a later enactment may relate to the same subject matter
as that of an earlier statute is not of itself sufficient to cause an implied repeal of
the latter, since the law may be cumulative or a continuation of the old
one.223 (Emphasis supplied, citations omitted)
Similarly, this court should also uphold as much as possible the validity of Customs
Personnel Order No. B-189-2013 as a valid exercise of executive power to
conform to the Policies on Detail.
"Every inten[t] of the law should lean towards its validity, not its
invalidity."224 Hence, the duration of Customs Personnel Order No. B-189-2013,
being independent and severable from the order of detail itself, should be the only
provision declared void.
Since there is no record that private respondents consented to be detailed for
more than one (1) year from September 17, 2013, Customs Personnel Order No.
B-189-2013, while effective for the duration of one (1) year from enactment,
already ceased to take effect.
The ponencia ruled that Customs Personnel Order No. B-189-2013 violates
Section 3 of Executive Order No. 140 because at the time of its issuance, the
Customs Policy Research Office had no organic personnel yet. 225cralawred The
ponencia also ruled that the Department of Finance Secretary had not yet issued
rules and regulations for the Customs Policy Research Office.226cralawrednad
There is nothing in Executive Order No. 140 that requires that the organic
personnel of the Customs Policy Research Office must first be organized and that
rules must first be issued by the Department of Finance Secretary before the
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Bureau of Customs can start forming its team that will augment and reinforce the
organic personnel of the Customs Policy Research Office. Courts should avoid as
much as possible any construction invalidating administrative issuances.227 Unless
there is a clear violation of Executive Order No. 140, Customs Personnel Order
No. B-189-2013 should remain valid.
ACCORDINGLY, the Petition should be GRANTED. Private respondents' Petition
for declaratory relief filed before the Regional Trial Court should
be DISMISSED for lack of jurisdiction.
November 22, 2017
A.M. No. RTJ-15-2407
EDGAR R. ERICE, Complainant
vs.
PRESIDING JUDGE DIONISIO C. SISON, REGIONAL TRIAL COURT, BRANCH
125, CALOOCAN CITY, Respondent
DECISION
CAGUIOA, J.:
This is an administrative matter1 filed by Edgar R. Erice (Erice) against the now-
retired Judge Dionisio C. Sison (Judge Sison) of the Regional Trial Court (RTC),
Branch 125, Caloocan City, for violation of Section 8, paragraphs 3, 4 and 9 of
A.M. No. 01-8-10-SC,2 in particular: (i) gross misconduct constituting violations of
the Code of Judicial Conduct, (ii) knowingly rendering an unjust judgment or order
as determined by a competent court in an appropriate proceeding, and (iii) gross
ignorance of the law or procedure.3
BACKGROUND
The facts leading to the filing of the complaint are as follows:
Complainant Erice, then Vice Mayor of Caloocan City, filed a complaint against
then Mayor Enrico R. Echiverri, City Treasurer Evelina Garma, Budget Officer
Jesusa Garcia and City Accountant Edna Centeno (Echiverri, et al.) before the
Office of the Ombudsman, for alleged violation of the Government Service
Insurance System Act.4 Acting on the complaint, the Ombudsman issued
an Order5 of Preventive Suspension (Order of Suspension) on July 18, 2011
against Echiverri, et al., to last until the administrative adjudication is completed
but not to exceed six (6) months.6
Aggrieved by the Order of Suspension, Echiverri, et al. elevated the matter to the
Court of Appeals (CA). While Echiverri, et al. were able to obtain a temporary
restraining order (TRO) and a writ of preliminary injunction from the CA Special
14th Division, nevertheless, in its Decision7 dated January 2, 2012, the
CA affirmed the Order of Suspension of the Ombudsman and lifted and set aside
the TRO. The decretal portion of the CA Decision of January 2, 2012 provides:
WHEREFORE, premises considered, the Writ of Preliminary Injunction issued by
this Court is hereby LIFTED and SET ASIDE. Accordingly, the assailed Order
dated July 18, 2011 issued by the Office of the Ombudsman in OMB-C-A-11-0401-
G is hereby AFFIRMED.
SO ORDERED.8
A week later, or on January 9, 2012, Echiverri, et al. filed a Petition for Declaratory
Relief with Prayer for TRO and/or Writ of Preliminary Injunction9 with the RTC of
Caloocan City, which was docketed as Special Civil Action No. C-1060
(2012)10 Named as Respondents in the Petition/or Declaratory Relief were Erice
(Complainant in the present administrative matter) and the Department of Interior
and Local Government (DILG). Echiverri, et al. prayed that the RTC "make a
definite judicial declaration on the rights and obligations of the parties asserting
adverse legal interests with respect to the implementation of [their] suspension."11
On even date, RTC Executive Judge Eleanor R. Kwong issued a 72- hour ex-parte
Order to enjoin the DILG and Erice from implementing the Order of
Suspension. Subsequently, the case was raffled and assigned to Judge Lorenza
R. Bordios.12
In the summary hearing held on January 10, 2012, Erice and the DILG questioned
the jurisdiction of the RTC to hear the matter, considering that the object of
the Petition for Declaratory Relief were the CA Decision and the Order of
Suspension of the Ombudsman. They also raised the matter of forum shopping,
with Erice and the DILG pointing out that Echiverri, et al. had a pending Motion for
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Reconsideration13 filed with the CA and a Motion to Hold in Abeyance the
Implementation of the Order of Preventive Suspension 14 with the Office of the
Ombudsman.15
However, Judge Bordios inhibited herself from proceeding with the case on
January 11, 2012. The case was subsequently re-raffled to herein Respondent
Judge Sison.16
On the same day, January 11, 2012, with the case now pending before Judge
Sison, Erice and the DILG reiterated their Motion to Dismiss and Motion to
Dissolve. That afternoon, Judge Sison noted that the 72-hour TRO of the Order of
Suspension would be expiring the next day, on January 12, 2012, and that the
parties ought to finish with the presentation of evidence before noon of January 12,
2012. Counsel for the DILG informed Judge Sison that the OSG was not informed
that the summary hearing would proceed at 2:00 p.m. of January 11, 2012 before
Branch 125. Nevertheless, Judge Sison proceeded with the hearing and allowed
Echiverri, et al. to present their evidence until 5:00 p.m. that day.17
The next day, at 8:00 a.m., the summary hearing continued. The OSG invoked its
right to cross-examine the witnesses earlier presented by Echiverri, et al. but
Judge Sison denied the same, allegedly without consulting the records from
Branch 126 that would indicate that the OSG had made reservations to this effect
on January 10, 2012. At 9:15 a.m., Judge Sison issued an Order18 extending the
TRO to 20 days, inclusive of the 72-hour TRO earlier granted by Judge Kwong.19
On the day scheduled for the hearing on the Motion to Dismiss, January 17, 2012,
Judge Sison stated that he would hear evidence in support of the application for a
writ of preliminary injunction. This compelled Erice to file an Urgent Motion to
lnhibit.20 Without ruling on the Motion to Inhibit, Judge Sison issued
the Order21 granting the writ of preliminary injunction.22
For his part, in refuting the charges against him, Judge Sison denied any
allegations of the violation of the right to due process of Erice and the DILG in
allowing the summary hearing to proceed and Echiverri, et al. to present evidence
even though the OSG was not informed of said hearing.23 Judge Sison submitted
that:
1. There is no basis for the claim of bias and partiality because the reason for the
extension of the 72-hour TRO to a 20-day TRO was to accord Echiverri, et al. due
process in allowing them to file their written comment and to argue against the
Motion to Dissolve.24
2. There was no "deplorable haste" in issuing the TRO and writ of preliminary
injunction because "of the limited time provided by the Rules of Court," in
particular, Rule 58, Section 5; and that Erice' s counsel, "knowing this time
constraint x x x should have made himself always ready to go to trial and to
present his testimonial and documentary evidences (sic)."25
3. While admitting that the DILG's counsel appeared before him and that he denied
the OSG's claim of the right to cross-examine, Judge Sison claims that Erice failed
to produce evidence that he made such rulings and therefore "should not be
believed."26
The Office of the Court
Administrator (OCA) Report dated
November 4, 2014
In its Report27 dated November 4, 2014, the OCA recommended that:
x x x [R]espondent Judge be found GUILTY of Gross Ignorance of the Law
and FINED in the amount equivalent to his one (1) month salary with a warning
that a repetition of the same or similar act shall be dealt with more severely.28
The basis for the OCA's recommendation are as follows:
First, insofar as the alleged haste is concerned, indeed, this Court had ruled
in Leviste v. Alameda29 that "the pace in resolving incidents of the case is not per
se an indication of bias."30 Nevertheless, Judge Sison's act of issuing a TRO and
writ of preliminary injunction against Erice and the DILG to enjoin the latter from
enforcing the Ombudsman's Order of Suspension constitutes a violation of Section
14 of Republic Act No. (RA) 6770,31 which provides:
SEC. 14. Restrictions. - No writ of injunction shall be issued by any court to delay
an investigation being conducted by the Ombudsman under this Act, unless there
is a prima facie evidence that the subject matter of the investigation is outside the
jurisdiction of the Office of the Ombudsman.
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No court shall hear any appeal or application for remedy against the decision or
findings of the Ombudsman, except the Supreme Court, on pure question of law.
Second, in a similar case, Ogka Benito v. Balindong,32 therein Respondent Judge
Balindong issued a 72-hour TRO and extended the same for 20 days, against the
enforcement of a DILG Department Order implementing a decision to suspend an
official for nine months. This Court found that Judge Balindong's act constituted
gross ignorance of the law for violating Section 14 of RA 6770. Judge Balindong
was fined ₱30,000.00.33
Third, the OCA observed that although denominated as a Petition for Declaratory
Relief, it was clear that Echiverri, et al. merely sought the injunction to prevent the
implementation of the Ombudsman's Order of Suspension. In this regard, it is the
CA that has appellate jurisdiction over the administrative cases resolved by the
Ombudsman. Thus, Judge Sison cannot relax the rules, take cognizance of the
case, and issue a TRO and writ of injunction which are beyond his authority. 34
The OCA noted that this is Judge Sison's second offense. In A.M. No. RTJ-07-
2050, he was found guilty of Gross Ignorance of the Law and was fined
₱l0,000.00. Considering that this is Judge Sison's second offense, the penalty of
suspension should have been imposed on him; however, since he was due for
compulsory retirement on December 9, 2014, the OCA recommended that in lieu
of suspension, Judge Sison should be meted a penalty of fine equivalent to one (1)
month's salary.35
This Court's Resolutions
In a Resolution dated February 23, 2015, this Court noted the OCA Report dated
November 4, 2014 recommending that Judge Sison be found guilty of gross
ignorance of the law and be fined an amount equivalent to one (1) month's salary,
with a warning that repetition of the same or similar act will be dealt with more
severely.36
Subsequently, in a Resolution dated August 5, 2015, this Court, acting on Judge
Sison's request for the payment of his terminal leave, resolved the same in his
favor, and released the terminal leave benefits after retaining the amount
equivalent to his two (2) months' salary, to answer for whatever penalty the Court
may impose against him in his pending administrative cases. 37
DISCUSSION
The Court agrees with the findings of the OCA, with a modification on the penalty
imposed on Judge Sison.1awp++i1
Gross ignorance of the law is a serious charge under Section 8, Rule 140 of the
Rules of Court as amended by A.M. No. 01-8-10-SC. It requires the judge to
perform his/her duty to be acquainted with the basic legal command of law and
rules.38 Consequently, a judge becomes liable for gross ignorance of the law when
there is a patent disregard for well-known rules so as to produce an inference of
bad faith, dishonesty and corruption.39
Against these parameters, Judge Sison failed to perform his basic duty to be
acquainted with the fundamentals of the very law he was tasked to uphold, and
this conclusion remains unchanged notwithstanding the Court's supervening
Decision in Carpio Morales v. Court of Appeals.40 In Carpio Morales, the Court: (1)
declared as unconstitutional Section 14(2)41 of RA 6770, and (2) declared as
ineffective the policy in Section 14(1)42 of RA 6770 against the issuance of a
provisional injunctive writ by courts other than the Supreme Court to enjoin an
investigation conducted by the Office of the Ombudsman until the Court adopts the
same as part of the rules of procedure through an administrative circular duly
issued therefor.43
Be that as it may, the subsequent declaration of the policy in Section 14(1) of RA
6770 as ineffective and of Section 14(2) as invalid, does not serve to exonerate
Judge Sison from administrative liability because he failed to consider and act in
accordance with the basic principle of judicial stability or non-
interference.44 Pursuant to this principle, where decisions of certain administrative
bodies are appealable to the CA, these adjudicative bodies are co-equal with the
RTCs and their actions are logically beyond the control of the RTC.45
Notably, the Ombudsman's decisions in disciplinary cases are appealable to the
CA under Rule 43 of the Rules of Court. Consequently, the RTC had no jurisdiction
to interfere with or restrain the execution of the Ombudsman's decisions in
disciplinary cases,46 more so, because at the time Judge Sison issued the TRO on
January 10, 2012 and proceeded with the writ of preliminary injunction on January
17, 2012 against the enforcement of the Ombudsman Order of Suspension, the
CA had already affirmed that very same Order of Suspension in its Decisiondated
January 2, 2012.
In any event, Judge Sison should have, at the very least, been aware that court
orders or decisions cannot be the subject matter of a petition for declaratory
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relief.47 They are not included within the purview of the words "other written
instrument"48 in Rule 6349 of the Rules of Court governing petitions for declaratory REVIEW OF JUDGMENTS AND FINAL ORDERS OF THE
relief. The same principle applies to orders, resolutions, or decisions of quasi- COMELEC AND COA
judicial bodies,50 and this is anchored on the
principle ofresjudicata.51 Consequently, a judgment rendered by a court or a quasi-
judicial body is conclusive on the parties, subject only to appellate authority. 52 The
losing party cannot modify or escape the effects of judgment under the guise of an G.R. No. 206987 September 10, 2013
action for declaratory relief.53
ALLIANCE FOR NATIONALISM AND DEMOCRACY (ANAD), Petitioner,
Here, Echiverri, et al.'s Petition for Declaratory Relief specifically prayed that the vs.
RTC "make a definite judicial declaration on the rights and obligations of the COMMISSION ON ELECTIONS, Respondent.
parties asserting adverse legal interests with respect to the implementation of the
[order of] preventive suspension,"54 effectively putting into question the CA- DECISION
affirmed Ombudsman Order of Suspension - a matter clearly beyond the ambit of
the RTC's jurisdiction. This, coupled with the deference to the basic precepts of
jurisdiction required of judges, leads to no other conclusion than that Judge Sison PEREZ, J.:
acted in gross ignorance of the law in proceeding with the issuance of the writ of
preliminary injunction.1âwphi1 Before the Court is a Petition for Certiorari with Urgent Prayer for the Issuance of a
Temporary Restraining Order and Writ of Mandamus, seeking to compel the
As a serious charge under Rule 140 of the Rules of Court as amended by A.M. No. Commission on Elections (COMELEC) to canvass the votes cast for petitioner
01-8-10-SC, the penalty for gross ignorance of the law or procedure ranges from a Alliance for Nationalism and Democracy (ANAD) in the recently held 2013 Party-
fine of more than ₱20,000.00 but not exceeding ₱40,000.00 to List Elections.
dismissal.55 Inasmuch as Judge Sison had already retired on December 9, 2014,
the imposition of the penalty of suspension is no longer feasible. In lieu of On 7 November 2012, the COMELEC En Banc promulgated a Resolution
suspension, a fine may still be imposed.56 Considering that this is not Judge canceling petitioner’s Certificate of Registration and/or Accreditation on three
Sison's first offense, the Court finds that the fine of Forty Thousand Pesos grounds, to wit:1
(₱40,000.00) is justified under the circumstances.57 In light of this Court's
Resolution dated August 5, 2015, the fine shall be charged against the retained I.
amounts from Judge Sison.
Petitioner ANAD does not belong to, or come within the ambit of, the
WHEREFORE, the Court hereby finds retired Judge Dionisio C. Sison GUILTY of marginalized and underrepresented sectors enumerated in Section 5 of
gross ignorance of the law under Section 8, Rule 140 of the Rules of Court as R.A. No. 7941 and espoused in the cases of Ang Bagong Bayani-OFW
amended by A.M. No. 01-8-10-SC, and is hereby ordered to PAY A FINE of Forty Labor Party v. Commission on Elections and Ang Ladlad LGBT Party v.
Thousand Pesos (₱40,000.00), to be deducted from his terminal leave benefits Commission on Elections.
earlier retained pursuant to this Court's Resolution dated August 5, 2015, with the
remaining amount to be released to Judge Sison immediately. II.

SO ORDERED. There is no proof showing that nominees Arthur J. Tariman and Julius D.
Labandria are actually nominated by ANAD itself. The Certificate of
Nomination, subscribed and sworn to by Mr. Domingo M.Balang, shows
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 that ANAD submitted only the names of Pastor Montero Alcover, Jr.,
Baltaire Q. Balangauan and Atty. Pedro Leslie B. Salva. It necessarily
follows, that having only three (3) nominees, ANAD failed to comply with
the procedural requirements set forth in Section 4, Rule 3 of Resolution
No. 9366.
III.
ANAD failed to submit its Statement of Contributions and Expenditures for the
2007 National and Local Elections as required by Section 14 of Republic Act No.
7166 ("R.A. No. 7166").
ANAD went before this Court challenging the above-mentioned resolution. In
Atong Paglaum, Inc. v. Comelec,2 the Court remanded the case to the COMELEC
for re-evaluation in accordance with the parameters prescribed in the aforesaid
decision.
In the assailed Resolution dated 11 May 2013,3 the COMELEC affirmed the
cancellation of petitioner’s Certificate of Registration and/or Accreditation and
disqualified it from participating in the 2013 Elections. The COMELEC held that
while ANAD can be classified as a sectoral party lacking in well-defined political
constituencies, its disqualification still subsists for violation of election laws and
regulations, particularly for its failure to submit at least five nominees, and for its
failure to submit its Statement of Contributions and Expenditures for the 2007
Elections.
Hence, the present petition raising the issues of whether or not the COMELEC
gravely abused its discretion in promulgating the assailed Resolution without the
benefit of a summary evidentiary hearing mandated by the due process clause,
and whether or not the COMELEC erred in finding that petitioner submitted only
three nominees and that it failed to submit its Statement of Contributions and
Expenditures in the 2007Elections.4
We dismiss the petition.
The only question that may be raised in a petition for certiorari under Section 2,
Rule 64 of the Rules of Court is whether or not the COMELEC acted with grave
abuse of discretion amounting to lack or excess of jurisdiction. For a petition for
certiorari to prosper, there must be a clear showing of caprice and arbitrariness in
the exercise of discretion.5
"Grave abuse of discretion," under Rule 65, has a specific meaning. It is the
arbitrary or despotic exercise of power due to passion, prejudice or personal
hostility; or the whimsical, arbitrary, or capricious exercise of power that amounts
to an evasion or a refusal to perform a positive duty enjoined by law or to act at all
in contemplation of law. For an act to be struck down as having been done with
grave abuse of discretion, the abuse of discretion must be patent and gross. 6
ANAD claims that the COMELEC gravely abused its discretion when it
promulgated the assailed Resolution without giving ANAD the benefit of a
summary evidentiary hearing, thus violating its right to due process. It is to be
noted, however, that ANAD was already afforded a summary hearing on23 August
2013, during which Mr. Domingo M. Balang, ANAD’s president, authenticated
documents and answered questions from the members of the COMELEC pertinent
to ANAD’s qualifications.7
ANAD, nonetheless, insists that the COMELEC should have called for another
summary hearing after this Court remanded the case to the COMELEC for re-
evaluation in accordance with the parameters laid down in Atong Paglaum, Inc. v.
Comelec . This is a superfluity.
ANAD was already given the opportunity to prove its qualifications during the
summary hearing of 23 August 2012, during which ANAD submitted documents
and other pieces of evidence to establish said qualifications. In re-evaluating
ANAD’s qualifications in accordance with the parameters laid down in Atong
Paglaum, Inc. v. COMELEC , the COMELEC need not have called another
summary hearing. The Comelec could, as in fact it did,8 readily resort to
documents and other pieces of evidence previously submitted by petitioners in re-
appraising ANAD’s qualifications. After all, it can be presumed that the
qualifications, or lack thereof, which were established during the summary hearing
of 23 August2012 continued until election day and even there after.
As to ANAD’s averment that the COMELEC erred in finding that it violated election
laws and regulations, we hold that the COMELEC, being a specialized agency
tasked with the supervision of elections all over the country, its factual findings,
conclusions, rulings and decisions rendered on matters falling within its
competence shall not be interfered with by this Court in the absence of grave
abuse of discretion or any jurisdictional infirmity or error of law.9
As found by the COMELEC, ANAD, for unknown reasons, submitted only three
nominees instead of five, in violation of Sec. 8 of R.A. No. 7941( An Act Providing
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for the Election of Party-List Representatives through the Party-List System, and
Appropriating Funds Therefor).10 Such factual finding of the COMELEC was based
on the Certificate of Nomination presented and marked by petitioner during the 22
and 23 August 2012summary hearings.11
Compliance with Section 8 of R.A. No. 7941 is essential as the said provision is a
safeguard against arbitrariness.1âwphi1Section 8 of R.A. No. 7941rids a party-list
organization of the prerogative to substitute and replace its nominees, or even to
switch the order of the nominees, after submission of the list to the COMELEC.
In Lokin, Jr. v. Comelec,12 the Court discussed the importance of Sec.8 of R.A. No.
7941 in this wise:
The prohibition is not arbitrary or capricious; neither is it without reason on the part
of lawmakers. The COMELEC can rightly presume from the submission of the list
that the list reflects the true will of the party-list organization. The COMELEC will
not concern itself with whether or not the list contains the real intended nominees
of the party-list organization, but will only determine whether the nominees pass all
the requirements prescribed by the law and whether or not the nominees possess
all the qualifications and none of the disqualifications. Thereafter, the names of the
nominees will be published in newspapers of general circulation. Although the
people vote for the party-list organization itself in a party-list system of election, not
for the individual nominees, they still have the right to know who the nominees of
any particular party-list organization are. The publication of the list of the party-list
nominees in newspapers of general circulation serves that right of the people,
enabling the voters to make intelligent and informed choices. In contrast, allowing
the party-list organization to change its nominees through withdrawal of their
nominations, or to alter the order of the nominations after the submission of the list
of nominees circumvents the voters’ demand for transparency. The lawmakers’
exclusion of such arbitrary withdrawal has eliminated the possibility of such
circumvention.
Moreover, the COMELEC also noted ANAD’s failure to submit a proper Statement
of Contributions and Expenditures for the 2007 Elections, in violation of COMELEC
Resolution No. 9476, viz:
Rule 8, Sec. 3. Form and contents of statements. – The statement required in next
preceding section shall be in writing, subscribed and sworn to by the candidate or
by the treasurer of the party. It shall set forth in detail the following:
a. The amount of contribution, the date of receipt, and the full name,
profession, business, taxpayer identification number (TIN) and exact home
and business address of the person or entity from whom the contribution
was received; (See Schedule of Contributions Received, Annex "G")
b. The amount of every expenditure, the date thereof, the full name and
exact address of the person or entity to whom payment was made, and the
purpose of the expenditure; (See Schedule of Expenditures, Annex "H")
A Summary Report of Lawful Expenditure categorized according to the list
specified above shall be submitted by the candidate or party treasurer
within thirty (30) days after the day of the election. The prescribed form for
this Summary Report is hereby attached to these Rules as Annex "H-1."
c. Any unpaid obligation, its nature and amount, the full name and exact
home and business address of the person or entity to whom said
obligation is owing; and (See Schedule of Unpaid Obligations, Annex "I")
d. If the candidate or treasurer of the party has received no contribution,
made no expenditure, or has no pending obligation, the statement shall
reflect such fact;
e. And such other information that the Commission may require.
The prescribed form for the Statement of Election Contributions and Expenses is
attached to these Rules as Annex "F." The Schedules of Contributions and
Expenditures (Annexes "G" and "H", respectively) should be supported and
accompanied by certified true copies of official receipts, invoices and other similar
documents.
An incomplete statement, or a statement that does not contain all the required
information and attachments, or does not conform to the prescribed form, shall be
considered as not filed and shall subject the candidate or party treasurer to the
penalties prescribed by law.
As found by the COMELEC, ANAD failed to comply with the above-mentioned
requirements as the exhibits submitted by ANAD consisted mainly of a list of total
contributions from other persons, a list of official receipts and amounts without
corresponding receipts, and a list of expenditures based on order slips and
donations without distinction as to whether the amounts listed were advanced
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subject to reimbursement or donated.13 This factual finding was neither contested
nor rebutted by ANAD.
We herein take the opportunity to reiterate the well-established principle that the
rule that factual findings of administrative bodies will not be disturbed by the courts
of justice except when there is absolutely no evidence or no substantial evidence
in support of such findings should be applied with greater force when it concerns
the COMELEC, as the framers of the Constitution intended to place the COMELEC
– created and explicitly made independent by the Constitution itself – on a level
higher than statutory administrative organs. The COMELEC has broad powers to
ascertain the true results of the election by means available to it. For the
attainment of that end, it is not strictly bound by the rules of evidence. 14
As empowered by law, the COMELEC may motu proprio cancel, after due notice
and hearing, the registration of any party-list organization if it violates or fails to
comply with laws, rules or regulations relating to elections. 15 Thus, we find no
grave abuse of discretion on the part of the COMELEC when it issued the assailed
Resolution dated 11 May 2013.
In any event, the official tally results of the COMELEC show that ANAD garnered
200,972 votes.16 As such, even if petitioner is declared qualified and the votes cast
for it are canvassed, statistics show that it will still fail to qualify for a seat in the
House of Representatives.
WHEREFORE, premises considered, the Court Resolves to DISMISS the Petition,
finding no grave abuse of discretion on the part of the Commission on Elections.
SO ORDERED.
CERTIORARI, PROHIBITION AND MANDAMUS
G.R. No. 192685 July 31, 2013
OSCAR R. AMPIL, Petitioner,
vs.
THE HON. OFFICE OF THE OMBUDSMAN, POLICARPIO L. ESPENESIN,
Registrar, Register of Deeds, Pasig City, FRANCIS SERRANO, YVONNE S.
YUCHENGCO, and GEMA O. CHENG, Respondents.
x-----------------------x
G.R. No. 199115
OSCAR R. AMPIL, Petitioner,
vs.
POLICARPIO L. ESPENESIN, Respondent.
DECISION
PEREZ, J.:
No less than the Constitution maps out the wide grant of investigatory powers to
the Ombudsman.1 Hand in hand with this bestowal, the Ombudsman is mandated
to investigate and prosecute, for and in behalf of the people, criminal and
administrative offenses committed by government officers and employees, as well
as private persons in conspiracy with the former.2 There can be no equivocation
about this power-and-duty function of the Ombudsman.
Before us are consolidated petitions separately filed by Oscar R. Ampil (Ampil): (1)
one is for certiorari under Rule 65 of the Rules of Court docketed as G.R. No.
192685; and (2) the other is for review on certiorari under Rule 45 of the Rules of
Court docketed as G.R. No. 199115.
Challenged in the petition for certiorari is the Resolution3 of the Ombudsman in
OMB-C-C-07-0444-J, dismissing the criminal complaint filed by Ampil against
respondents Policarpio L. Espenesin (Espenesin), Francis Serrano (Serrano),
Yvonne S. Yuchengco (Yuchengco) and Gema O. Cheng (Cheng), and the
Order4 denying Ampil’s motion for reconsideration thereof. Ampil’s complaint
charged respondents with Falsification of Public Documents under Article 171(6) of
the Revised Penal Code and violation of Sections 3(a) and (e) of Republic Act No.
3019, The Anti-Graft and Corrupt Practices Act, as amended.
The appeal by certiorari, on the other hand, assails the Decision of the Court of
Appeals in CA G.R. SP No. 113171, which affirmed the Order dated 13 July 2009
of the Ombudsman in OMB-C-A-07-0474-J on the administrative aspect of the
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mentioned criminal complaint for Falsification and violation of Republic Act No.
3019 against the Registrar of Deeds, respondent Espenesin. Initially, the
Ombudsman issued a Decision dated 30 April 2008, finding Espenesin guilty of
Simple Misconduct and meting on Espenesin the penalty of one (1) month
suspension. On motion for reconsideration of Ampil, the Ombudsman favored
Espenesin’s arguments in his Opposition, and recalled the one-month suspension
the Ombudsman had imposed on the latter.
These consolidated cases arose from the following facts.
On 9 November 1995, ASB Realty Corporation (ASB) and Malayan Insurance
Company (MICO) entered into a Joint Project Development Agreement (JPDA) for
the construction of a condominium building to be known as "The Malayan Tower."
Under the JPDA, MICO shall provide the real property located at the heart of the
Ortigas Business District, Pasig City, while ASB would construct, and shoulder the
cost of construction and development of the condominium building.
A year thereafter, on 20 November 1996, MICO and ASB entered into another
contract, with MICO selling to ASB the land it was contributing under the JPDA.
Under the Contract to Sell, ownership of the land will vest on ASB only upon full
payment of the purchase price.
Sometime in 2000, ASB, as part of the ASB Group of Companies, filed a Petition
for Rehabilitation with Prayer for Suspension of Actions and Proceedings before
the Securities and Exchange Commission (SEC). As a result, the SEC issued a
sixty (60) day Suspension Order (a) suspending all actions for claims against the
ASB Group of Companies pending or still to be filed with any court, office, board,
body, or tribunal; (b) enjoining the ASB Group of Companies from disposing of
their properties in any manner, except in the ordinary course of business, and from
paying their liabilities outstanding as of the date of the filing of the petition; and (c)
appointing Atty. Monico V. Jacob as interim receiver of the ASB Group of
Companies.5 Subsequently, the SEC, over the objections of creditors, approved
the Rehabilitation Plan submitted by the ASB Group of Companies, thus:
PREMISES CONSIDERED, the objections to the rehabilitation plan raised by the
creditors are hereby considered unreasonable.
Accordingly, the Rehabilitation Plan submitted by petitioners is hereby
APPROVED, except those pertaining to Mr. Roxas’ advances, and the ASB-
Malayan Towers. Finally, Interim Receiver Mr. Fortunato Cruz is appointed as
Rehabilitation Receiver.6 (Emphasis supplied).
Because of the obvious financial difficulties, ASB was unable to perform its
obligations to MICO under the JPDA and the Contract to Sell. Thus, on 30 April
2002, MICO and ASB executed their Third contract, a Memorandum of Agreement
(MOA),7 allowing MICO to assume the entire responsibility for the development
and completion of The Malayan Tower. At the time of the execution of the MOA,
ASB had already paid MICO ₱427,231,952.32 out of the ₱640,847,928.48
purchase price of the realty.8
The MOA specifies the entitlement of both ASB and MICO to net saleable areas of
The Malayan Tower representing their investments. It provides, in pertinent part:
Section 4. Distribution and Disposition of Units. (a) As a return of its capital
investment in the Project, each party shall be entitled to such portion of all the net
saleable area of the Building that their respective contributions to the Project bear
to the actual construction cost. As of the date of the execution hereof, and on the
basis of the total costs incurred to date in relation to the Remaining Construction
Costs (as defined in Section 9(a) hereof), the parties shall respectively be entitled
to the following (which entitlement shall be conditioned on, and subject to,
adjustments as provided in sub-paragraph (b) of Section 4 in the event that the
actual remaining cost of construction exceeds the Remaining Construction Cost):
(i) MICO – the net saleable area particularly described in Schedule
2 hereof.
(ii) ASB – the following net saleable area:
(A) the net saleable area which ASB had pre-sold for an
aggregate purchase price of ₱640,085,267.30 as set forth
in Schedule 1 (including all paid and unpaid proceeds of
said presales);
(B) the net saleable area particularly described in
Schedule 3 hereof which shall be delivered to ASB upon
completion of the Project; and,
(C) provided that the actual remaining construction costs
do not exceed the Remaining Construction Cost, the net
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 saleable area particularly described in Schedule 4 hereof
which shall be delivered to ASB upon completion of the
Project and determination of its actual construction costs.
If the actual remaining construction costs exceed the
Remaining Construction Cost, sub-paragraph (b) of this
Section 4 shall apply.
(b) In the event that the actual remaining construction costs exceed the
Remaining Construction Cost as represented and warranted by ASB to
MICO under Section 9(a) hereof, and MICO pays for such excess, the pro-
rata sharing in the net saleable area of the Building, as provided in sub-
paragraph (a) of this Section 4 shall be adjusted accordingly. In such
event, MICO shall be entitled to such net saleable area in Schedule 4 that
corresponds to the excess of the actual remaining cost over the
Remaining Construction Cost.
(c) To ensure the viability of the Project, the parties agree on a single
pricing system, which MICO shall have the exclusive right to fix and
periodically adjust based on prevailing market conditions in consultation
with, but without need of consent of, ASB, for each party’s primary sale or
other disposition of its share in the net saleable area of the Building. In
accordance with the immediately preceding provision, MICO hereby
adopts the selling prices set forth in Schedule 5 hereof. Each party or its
officers, employees, agents or representatives shall not sell or otherwise
dispose any share of said party in the net saleable area of the Building
below the prices fixed by MICO in accordance with this Section 4 (c).
MICO shall have the exclusive right to adopt financing and discounting
schemes to enhance marketing and sales of units in the Project and such
right of MICO shall not be restricted or otherwise limited by the foregoing
single pricing system provision.
(d) Each party shall bear the profits earned and losses incurred as well as
any and all taxes and other expenses in connection with the allocation or
sale of, or other transaction relating to, the units allotted to each party. 9
On 11 March 2005, Condominium Certificates of Title (CCTs) for 38 units10 and the
allotted parking spaces were issued in the name of ASB. On even date but prior to
its release, another set of CCTs covering the same subject units but with MICO as
registered owner thereof, was signed by Espenesin in his capacity as Registrar of
Deeds of Pasig City. Notably, Espenesin had likewise signed the CCTs which were
originally issued in ASB’s name.
On 2 April 2006, counsel for ASB wrote Espenesin calling his attention to the
supposed amendment in the CCTs which he had originally issued in ASB’s
name.11 Counsel for ASB demanded that Espenesin effect in the second set of
CCTs, the registration of the subject units in The Malayan Tower back to ASB’s
name.
On 17 May 2006, Espenesin replied and explained, thus:
The registration of the Malayan-ASB Realty transaction, from its inception up to the
issuance of titles, were all handled by respondent Atty. Francis Serrano. He
therefore appeared and we have considered him the legitimate representative of
both parties (sic). His representation, we gathered, covers the interest of both
MICO and ASB in as far as the titling of the condominium units are concerned.
Sometime ago Serrano requested that condominium titles over specified units be
issued in consonance with the sharing in the joint venture MOA. Titles were
correspondingly issued as per request, some in the name of MICO and some in
the name of ASB. Before its release to the parties, Atty. Serrano came back and
requested that some titles issued in the name of ASB be changed to MICO
because allegedly there was error in the issuance.
Believing it was a simple error and on representation of the person we came to
know and considered the representative of both parties, we erased the name ASB
Realty Corporation on those specified titles and placed instead the name Malayan
Insurance Company.
To our mind, the purpose was not to transfer ownership but merely to rectify an
error committed in the issuance of titles. And since they were well within our
capacity to do, the titles not having been released yet to its owner, we did what we
believed was a simple act of rectifying a simple mistake.12
After learning of the amendment in the CCTs issued in ASB’s name, Ampil, on 23
January 2007, wrote respondents Yuchengco and Cheng, President and Chief
Financial Officer of MICO, respectively, introducing himself as an unsecured
creditor of ASB Holdings, Inc., one of the corporations forming part of the ASB
Group of Companies.13Ampil averred that MICO had illegally registered in its name
the subject units at The Malayan Tower which were reserved for ASB under the
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MOA, and actually, already registered in ASB’s name with the Register of Deeds of
Pasig City. Ampil pointed out that the "condominium units should have benefited
him and other unsecured creditors of ASB because the latter had categorically
informed them previously that the same would be contributed to the Asset Pool
created under the Rehabilitation Plan of the ASB Group of Companies." Ultimately,
Ampil demanded that Yuchengco and Cheng rectify the resulting error in the
CCTs, and facilitate the registration of the subject units back to ASB’s name.
Respondents paid no heed to ASB’s and Ampil’s demands.
As previously adverted to, Ampil charged respondents with Falsification of Public
Documents under Article 171(6) of the Revised Penal Code and violation of
Sections 3(a) and (e) of Republic Act No. 3019 before the Office of the
Ombudsman, alleging the following:
1. Respondents, in conspiracy, erased the name of ASB, and intercalated
and substituted the name of MICO under the entry of registered owner in
the questioned CCTs covering the subject units of The Malayan Tower;
2. The alterations were done without the necessary order from the proper
court, in direct violation of Section 10814 of Presidential Decree No. 1529;
3. Respondents violated Article 171(6) of the Revised Penal Code by:
3.1 Altering the CCTs which are public documents;
3.2 Effecting the alterations on genuine documents;
3.3 Changing the meaning of the CCTs with MICO now appearing
as registered owner of the subject units in Malayan Tower; and
3.4 Effectively, making the documents speak something false
when ASB is the true owner of the subject units, and not MICO.
4. Ampil, as unsecured creditor of ASB, was unjustly prejudiced by the
felonious acts of respondents;
5. Respondents violated Sections 3(a) and (e) of Republic Act No. 3019:
5.1 Respondent Espenesin, as Registrar of the Pasig City Registry
of Deeds, committed an offense in connection with his official
duties by allowing himself to be persuaded, induced or influenced
by respondent Serrano into altering the questioned CCTs; and
5.2 The actions of respondent Espenesin demonstrate manifest
partiality, evident bad faith and/or, at the least, gross inexcusable
negligence.
6. Respondents Yuchengco and Cheng, being responsible officers of
MICO, as principals by inducement and conspirators of Espenesin and
Serrano, are likewise liable for falsification of the CCTs and violation of
Sections 3(a) and (e) of Republic Act No. 3019.15
As required by the Ombudsman, respondents filed their counter-affidavits:
Espenesin and Serrano filed individually, while Yuchengco and Cheng filed jointly.
Respondents’ respective counter-affidavits uniformly denied petitioner’s charges
and explicated as follows:
Respondent Espenesin countered, among others, (i) that their intention was only to
cause the necessary rectification on certain errors made on the CCTs in issue; (ii)
that since the CCTs were not yet issued and released to the parties, it is still within
his authority, as part of the registration process, to make the necessary
amendments or corrections thereon; (iii) that no court order would be necessary to
effect such changes, the CCTs still being within the control of the Register of
Deeds and have not yet been released to the respective owners; (iv) that the
amendments were made not for the purpose of falsifying the CCTs in issue but to
make the same reflect and declare the truth; and (v) that he merely made the
corrections in accordance with the representations of respondent Serrano who he
believed to be guarding and representing both the interests of MICO and ASB.
Respondent Serrano, on the other hand, argued: (i) that the units in issue are not
yet owned by ASB; (ii) that these units were specifically segregated and reserved
for MICO in order to answer for any excess in the estimated cost that it will expend
in the completion of the Malayan Tower; (iii) that ASB is only entitled to these
reserved units only after the Malayan Tower is completed and that the units are not
utilized to cover for the increase in the cost expended by MICO pursuant to
Section 4(c) of the MOA; (iv) that the Malayan Tower was still incomplete at the
time when the alterations were made on the CCT, hence, the claim of ownership of
ASB over the reserved units is premature and totally baseless; (v) that prior to the
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fulfillment of the resolutory condition, that is, after the completion of the Malayan
Tower and there remains a balance in the Remaining Construction Cost, the units
still rightfully belongs to MICO; and (vi) that the alteration was made merely for the
purpose of correcting an error.
Respondents Cheng and Yuchengco, while adopting the foregoing arguments of
Espenesin and Serrano, further averred that: (i) Ampil has no legal personality to
file this suit, he being merely an unsecured creditor of ASB whose interest was not
definitively shown to have been damaged by the subject controversy; (ii) that their
participation as respondents and alleged co-conspirators of Serrano and
Espenesin was not clearly shown and defined in the complaint; (iii) the CCTs
issued in the name of ASB have not yet been entered in the Registration Book at
the time when the alterations were effected, hence, the same could still be made
subject of appropriate amendments; (iv) that the CCTs in issue named in favor of
ASB were mere drafts and cannot legally be considered documents within the
strict definition of the law; (v) that court order authorizing to amend a title is
necessary only if the deed or document sought to be registered has already been
entered in the registration book; and (vi) that MICO is the duly registered owner of
the land on which Malayan Tower stands and ASB was merely referred to as the
developer.16
Thereafter, the Ombudsman issued the assailed Resolution in G.R. No. 192685
dismissing Ampil’s complaint. For the Ombudsman, the resolution of whether
respondents falsified the CCTs must be prefaced by a determination of who,
between MICO and ASB, is the rightful owner of the subject units. The
Ombudsman held that it had no authority to interpret the provisions of the MOA
and, thus, refrained from resolving the preliminary question of ownership. Given
the foregoing, the Ombudsman was hard pressed to make a categorical finding
that the CCTs were altered to speak something false. In short, the Ombudsman
did not have probable cause to indict respondents for falsification of the CCTs
because the last element of the crime, i.e., that the change made the document
speak something false, had not been established.
Significantly, the Ombudsman did not dispose of whether probable cause exists to
indict respondents for violation of Sections 3(a) and (e) of Republic Act No. 3019.
Ampil filed a Motion for Reconsideration. However, in yet another setback, the
Ombudsman denied Ampil’s motion and affirmed the dismissal of his complaint.
On the administrative litigation front and as previously narrated, the Ombudsman
found Espenesin liable for Simple Misconduct. However, on motion for
reconsideration of Ampil praying for a finding of guilt against Espenesin for Grave
Misconduct and Dishonesty, the Ombudsman reconsidered its earlier resolution
and recalled the one-month suspension meted on Espenesin.
Thereafter, Ampil filed a petition for review under Rule 43 of the Rules of Court
before the appellate court. And as already stated, the appellate court affirmed the
Ombudsman’s resolution absolving Espenesin of not just Grave Misconduct and
Dishonesty, but also of Simple Misconduct.
Hence, this dual recourse by Ampil: first, alleging grave abuse of discretion in the
Ombudsman’s failure to find probable cause to indict respondents for Falsification
of Public Documents under Article 171(6) of the Revised Penal Code, and for their
commission of corrupt practices under
Sections 3(a) and (e) of Republic Act No. 3019; and second, raising grievous error
of the Court of Appeals in affirming the Ombudsman’s absolution of Espenesin
from administrative liability.
To obviate confusion, we shall dispose of the first issue, i.e., whether probable
cause exists to indict respondents for Falsification of Public Documents under
Article 171(6) of the Revised Penal Code and for their commission of corrupt
practices under Sections 3(a) and (e) of Republic Act No. 3019.
Despite the Ombudsman’s categorical dismissal of his complaint, Ampil is
adamant on the existence of probable cause to bring respondents to trial for
falsification of the CCTs, and for violation of Sections 3(a) and (e) of Republic Act
No. 3019. In fact, he argues that Espenesin has been held administratively liable
by the Ombudsman for altering the CCTs. At the time of the filing of G.R. No.
192685, the Ombudsman had not yet reversed its previous resolution finding
Espenesin liable for simple misconduct. He insists that the admission by
respondents Espenesin and Serrano that they altered the CCTs should foreclose
all questions on all respondents’ (Espenesin’s, Serrano’s, Yuchengco’s and
Cheng’s) liability for falsification and their commission of corrupt practices, under
the Revised Penal Code and Republic Act No. 3019, respectively. In all, Ampil
maintains that the Ombudsman’s absolution of respondents is tainted with grave
abuse of discretion.
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G.R. No. 192685 is partially impressed with merit. Accordingly, we find grave
abuse of discretion in the Ombudsman’s incomplete disposition of Ampil’s
complaint.
That the Ombudsman is a constitutional officer duty bound to "investigate on its
own, or on complaint by any person, any act or omission of any public official,
employee, office or agency, when such act or omission appears to be illegal,
unjust, improper, or inefficient"17 brooks no objection. The Ombudsman’s conduct
of preliminary investigation is both power and duty. Thus, the Ombudsman and his
Deputies, are constitutionalized as protectors of the people, who "shall act
promptly on complaints filed in any form or manner against public officials or
employees of the government x x x, and shall, x x x notify the complainants of the
action taken and the result thereof."18
The raison d'être for its creation and endowment of broad investigative authority is
to insulate the Office of the Ombudsman from the long tentacles of officialdom that
are able to penetrate judges’ and fiscals’ offices, and others involved in the
prosecution of erring public officials, and through the execution of official pressure
and influence, quash, delay, or dismiss investigations into malfeasances and
misfeasances committed by public officers.19
Plainly, the Ombudsman has "full discretion," based on the attendant facts and
circumstances, to determine the existence of probable cause or the lack
thereof.20 On this score, we have consistently hewed to the policy of non-
interference with the Ombudsman’s exercise of its constitutionally mandated
powers.21 The Ombudsman’s finding to proceed or desist in the prosecution of a
criminal case can only be assailed through certiorari proceedings before this Court
on the ground that such determination is tainted with grave abuse of discretion
which contemplates an abuse so grave and so patent equivalent to lack or excess
of jurisdiction.22
However, on several occasions, we have interfered with the Ombudsman’s
discretion in determining probable cause:
(a) To afford protection to the constitutional rights of the accused;
(b) When necessary for the orderly administration of justice or to avoid
oppression or multiplicity of actions;
(c) When there is a prejudicial question which is sub judice;
(d) When the acts of the officer are without or in excess of authority;
(e) Where the prosecution is under an invalid law, ordinance or regulation;
(f) When double jeopardy is clearly apparent;
(g) Where the court has no jurisdiction over the offense;
(h) Where it is a case of persecution rather than prosecution;
(i) Where the charges are manifestly false and motivated by the lust for
vengeance.23 (Emphasis supplied).
The fourth circumstance is present in G.R. No. 192685.
While we agree with the Ombudsman’s disquisition that there is no probable cause
to indict respondents for Falsification of Public Documents under Article 171(6) of
the Revised Penal Code, we are puzzled why the Ombudsman completely glossed
over Ampil’s charge that respondents committed prohibited acts listed in Sections
3(a) and (e) of Republic Act No. 3019. Nowhere in the Resolution or in the Order
denying reconsideration thereof did the Ombudsman tackle and resolve the issue
of whether respondents violated the particular provisions of Republic Act No. 3019.
Curiously, the Ombudsman docketed Ampil’s complaint-affidavit as one "for:
Falsification of Public Documents and Violation of Sections 3(a) and (e) of
Republic Act No. 3019, as amended."24 The Ombudsman even prefaced the
Resolution, thus: "this has reference to the complaint filed by Oscar Ampil on 17
September 2007 against respondents, for Falsification of Public Documents and
Violation of Sections 3, paragraphs (a) and (e) of Republic Act No. 3019, otherwise
known as the Anti-Graft and Corrupt Practices Act, as amended."25
The Ombudsman’s silence on the component anti-graft charges is pointed up by
the specific allegations in Ampil’s complaint-affidavit that:
18. The acts of ATTY. ESPENESIN and his co-conspirators are clear violations of
Section 3 paragraph (a) and/or (e) of Republic Act No. 3019 otherwise known as
the Anti-Graft and Corrupt Practices Act x x x;
xxxx
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19. On the basis of the evidence x x x and the admissions of the conspirators
themselves, ATTY. ESPENESIN is liable under both pars. (a) and (e) thereof or
either of the two. By maliciously and feloniously altering the subject CCT’s (sic),
contrary to law and to the prejudice of ASB and Ampil, ATTY. ESPENESIN
committed an offense in connection with his official duties and he admitted having
done so in conspiracy with his co-respondents. x x x ATTY. ESPENESIN allowed
himself to be persuaded, induced or influenced into committing such violation or
offense which is the substance of par. (a) of RA 3019;
20. In committing such unauthorized and unlawful alterations on the subject CCT’s
(sic), ATTY. ESPENESIN caused undue injury to ASB and to AMPIL as an
unsecured creditor, who is ultimately one of the beneficiaries of said CCT from the
ASSET POOL created by the SEC, and gave MICO unwarranted benefits,
advantage or preference in the discharge of his official duties as Register of Deeds
of Pasig City. Such acts were admitted by ATTY. ESPENESIN in his letter to ASB
x x x. Such acts, taken together with his admission, indubitably show ATTY.
ESPENESIN’s manifest partiality, evident bad faith and/or, at the least, his gross
inexcusable negligence in doing the same;
21. ATTY. ESPENESIN is liable under Section 3 pars. (a) and/or (e) of RA 3019,
as well as under Article 171 par. 6 of the RPC. ATTY. SERRANO, YVONNE S.
YUCHENGCO and (sic) GEMMA O. CHENG are also liable for violation of the said
provisions of law in conspiracy with ATTY. ESPENESIN, the latter as a principal
via direct participation, ATTY. SERRANO, as principal by inducement and
YUCHENGCO and CHENG, also by inducement, who being responsible officers of
MICO ultimately benefited from said unlawful act.26 and the pith of the Resolution
which carefully and meticulously dissected the presence of the first three definitive
elements of the crime of falsification under Article 171(6) of the Revised Penal
Code:
The first three definitive elements of the crime, albeit present, are defeated by the
absence of the fourth.
The respondents readily admitted that an alteration was indeed made on the CCTs
in issue allegedly for the purpose of correcting a mistake in the name of the
registered owner of the condominium units involved. Said alteration had obviously
changed the tenor of the CCTs considering that ASB, the initially named owner,
was changed into MICO. The first and third elements are undeniably present.
Anent the second element, the respondents argued that the CCTs in issue were
mere drafts and are not legally considered "genuine documents" within the strict
definition of the law. Albeit the contention is partially true, no proof has been shown
to prove that the CCTs issued in favor of ASB were mere drafts.
The CCTs of ASB are obviously complete. If we are to compare it with the
appearance and contents of the CCTs issued in favor of MICO, one will notice no
definitive difference between the two except that one set was named in favor of
ASB and the other set, in favor of MICO. Nothing is shown that will clearly prove
that the former were mere drafts and the latter are the final copies. As far as the
appearance of the CCTs of ASB is concerned, all appear to be complete and
genuine. Proof to the contrary must be shown to prove otherwise.
Delivery of the titles to the named owners is not a pre-requisite before all these
CCTs can be legally categorized as genuine documents. The fact that the same
had already been signed by respondent Espenesin in his capacity as Registrar of
Deeds of Pasig City and the notations imprinted thereon appeared to have been
entered on March 11, 2005 at 11:55 a.m. at the Registry Books of Pasig City, the
CCTs in issue are bound to be treated as genuine documents drafted and signed
in the regular performance of duties of the officer whose signature appears
thereon.27
On the whole, the Ombudsman’s discussion was straightforward and categorical,
and ultimately established that Espenesin, at the urging of Serrano, altered the
CCTs issued in ASB’s name resulting in these CCTs ostensibly declaring MICO as
registered owner of the subject units at The Malayan Tower.
Despite the admission by Espenesin that he had altered the CCTs and the
Ombudsman’s findings thereon, the Ombudsman abruptly dismissed Ampil’s
complaint-affidavit, resolving only one of the charges contained therein with nary a
link regarding the other charge of violation of Sections 3(a) and (e) of Republic Act
No. 3019. Indeed, as found by the Ombudsman, the 4th element of the crime of
Falsification of Public Documents is lacking, as the actual ownership of the subject
units at The Malayan Tower has yet to be resolved. Nonetheless, this
circumstance does not detract from, much less diminish, Ampil’s charge, and the
evidence pointing to the possible commission, of offenses under Sections 3(a) and
(e) of the Anti-Graft and Corrupt Practices Act.
Sections 3(a) and (e) of Republic Act No. 3019 reads:
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Section 3. Corrupt practices of public officers. – In addition to acts or omissions of
public officers already penalized by existing law, the following shall constitute
corrupt practices of any public officer and are hereby declared to be unlawful:
(a) Persuading, inducing or influencing another public officer to perform an act
constituting a violation of rules and regulations duly promulgated by competent
authority or an offense in connection with the official duties of the latter, or allowing
himself to be persuaded, induced, or influenced to commit such violation or
offense.
xxxx
(e) Causing any undue injury to any party, including the Government, or giving any
private party any unwarranted benefits, advantage or preference in the discharge
of his official, administrative or judicial functions through manifest partiality, evident
bad faith or gross inexcusable negligence. This provision shall apply to officers and
employees of offices or government corporations charged with the grant of
licenses or permits or other concessions.
The elements of Section 3(a) of Republic Act No. 3019 are:
(1) the offender is a public officer;
(2) the offender persuades, induces, or influences another public officer to
perform an act or the offender allows himself to be persuaded, induced, or
influenced to commit an act;
(3) the act performed by the other public officer or committed by the
offender constitutes a violation of rules and regulations duly promulgated
by competent authority or an offense in connection with the official duty of
the latter. (Emphasis supplied).
Whereas, paragraph (e) of the same section lists the following elements:
(1) the offender is a public officer;
(2) the act was done in the discharge of the public officer’s official,
administrative or judicial functions;
(3) the act was done through manifest partiality, evident bad faith, or gross
inexcusable negligence; and
(4) the public officer caused any undue injury to any party, including the
Government, or gave any unwarranted benefits, advantage or
preference.28
As Registrar of the Registry of Deeds of Pasig City, Espenesin is tasked, among
others, to review deeds and other documents for conformance with the legal
requirements of registration.29 Section 10 of Presidential Decree No. 1529,
Amending and Codifying the Laws Relative to Registration of Property and for
Other Purposes provides:
Section 10. General functions of Registers of Deeds. – The office of the Register of
Deeds constitutes a public repository of records of instruments affecting registered
or unregistered lands and chattel mortgages in the province or city wherein such
office is situated.
It shall be the duty of the Register of Deeds to immediately register an instrument
presented for registration dealing with real or personal property which complies
with all the requisites for registration. He shall see to it that said instrument bears
the proper documentary and science stamps and that the same are properly
cancelled. If the instrument is not registerable, he shall forthwith deny registration
thereof and inform the presentor of such denial in writing, stating the ground or
reason therefore, and advising him of his right to appeal by consulta in accordance
with Section 117 of the Decree.
Most importantly, a Registrar of the Registry of Deeds is charged with knowledge
of Presidential Decree No. 1529, specifically Sections 5730 and 108.31
In the instant case, the elements of the offenses under Sections 3(a) and (e) of
Republic Act No. 3019, juxtaposed against the functions of a Registrar of the
Registry of Deeds establish a prima facie graft case against Espenesin and
Serrano only. Under Section 3(a) of Republic Act No. 3019, there is a prima facie
case that Espenesin, at the urging of Serrano, allowed himself to be persuaded to
alter the CCTs originally issued in ASB’s name, against the procedure provided by
law for the issuance of CCTs and registration of property. In addition, under
Section 3(e) of the same law, there is likewise a prima facie case that Espenesin,
through gross inexcusable negligence, by simply relying on the fact that all
throughout the transaction to register the subject units at The Malayan Tower he
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liaised with Serrano, gave MICO an unwarranted benefit, advantage or preference
in the registration of the subject units.
In Sison v. People of the Philippines, we expounded on Section 3(e) of Republic
Act No. 3019:
The third element of Section 3 (e) of RA 3019 may be committed in three ways,
i.e., through manifest partiality, evident bad faith or gross inexcusable negligence.
Proof of any of these three in connection with the prohibited acts mentioned in
Section 3(e) of RA 3019 is enough to convict.
Explaining what "partiality," "bad faith" and "gross negligence" mean, we held:
"Partiality" is synonymous with "bias" which "excites a disposition to see and report
matters as they are wished for rather than as they are." "Bad faith does not simply
connote bad judgment or negligence; it imputes a dishonest purpose or some
moral obliquity and conscious doing of a wrong; a breach of sworn duty through
some motive or intent or ill will; it partakes of the nature of fraud." "Gross
negligence has been so defined as negligence characterized by the want of even
slight care, acting or omitting to act in a situation where there is a duty to act, not
inadvertently but willfully and intentionally with a conscious indifference to
consequences in so far as other persons may be affected. It is the omission of that
care which even inattentive and thoughtless men never fail to take on their own
property."
In the instant case, petitioner was grossly negligent in all the purchases that were
made under his watch. Petitioner’s admission that the canvass sheets sent out by
de Jesus to the suppliers already contained his signatures because he pre-signed
these forms only proved his utter disregard of the consequences of his actions.
Petitioner also admitted that he knew the provisions of RA 7160 on personal
canvass but he did not follow the law because he was merely following the practice
of his predecessors. This was an admission of a mindless disregard for the law in
a tradition of illegality. This is totally unacceptable, considering that as municipal
mayor, petitioner ought to implement the law to the letter. As local chief executive,
he should have been the first to follow the law and see to it that it was followed by
his constituency. Sadly, however, he was the first to break it.
Petitioner should have complied with the requirements laid down by RA 7160 on
personal canvass, no matter how strict they may have been. Dura lex sed lex. The
law is difficult but it is the law. These requirements are not empty words but were
specifically crafted to ensure transparency in the acquisition of government
supplies, especially since no public bidding is involved in personal canvass. Truly,
the requirement that the canvass and awarding of supplies be made by a collegial
body assures the general public that despotic, irregular or unlawful transactions do
not occur. It also guarantees that no personal preference is given to any supplier
and that the government is given the best possible price for its procurements.
The fourth element is likewise present. While it is true that the prosecution was not
able to prove any undue injury to the government as a result of the purchases, it
should be noted that there are two ways by which Section 3(e) of RA 3019 may be
violated—the first, by causing undue injury to any party, including the government,
or the second, by giving any private party any unwarranted benefit, advantage or
preference. Although neither mode constitutes a distinct offense, an accused may
be charged under either mode or both. The use of the disjunctive "or’ connotes
that the two modes need not be present at the same time. In other words, the
presence of one would suffice for conviction.
Aside from the allegation of undue injury to the government, petitioner was also
charged with having given unwarranted benefit, advantage or preference to private
suppliers. Under the second mode, damage is not required.
The word "unwarranted" means lacking adequate or official support; unjustified;
unauthorized or without justification or adequate reason. "Advantage" means a
more favorable or improved position or condition; benefit, profit or gain of any kind;
benefit from some course of action. "Preference" signifies priority or higher
evaluation or desirability; choice or estimation above another.
In order to be found guilty under the second mode, it suffices that the accused has
given unjustified favor or benefit to another, in the exercise of his official,
administrative or judicial functions. Petitioner did just that. The fact that he
repeatedly failed to follow the requirements of RA 7160 on personal canvass
proves that unwarranted benefit, advantage or preference was given to the winning
suppliers. These suppliers were awarded the procurement contract without the
benefit of a fair system in determining the best possible price for the government.
The private suppliers, which were all personally chosen by respondent, were able
to profit from the transactions without showing proof that their prices were the most
beneficial to the government. For that, petitioner must now face the consequences
of his acts.32 (Emphasis supplied).
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We stress that the Ombudsman did not find probable cause to indict respondents
for falsification simply because the Ombudsman could not categorically declare
that the alteration made the CCT speak falsely as the ownership of the subject
units at The Malayan Tower had yet to be determined. However, its initial factual
findings on the administrative complaint categorically declared, thus:
x x x Espenesin justified his action by asseverating that since the CCTs were still
under the possession and control of the Register of Deeds and have not yet been
distributed to the owners, amendments can still be made thereon.
It is worthy to note that the CCTs of ASB, at the time when the amendment was
made, were obviously complete. From its face, we can infer that all have attained
the character of a binding public document. The signature of Espenesin is already
affixed thereon, and on its face, it was explicitly declared that the titles have
already been entered in the Registration Book of the Register of Deeds of Pasig
City on March 11, 2005 at 11:55 a.m. Allegations to the contrary must be
convincingly and positively proven, otherwise, the presumption holds that the
CCTs issued in the name of ASB were regular and the contents thereon binding.
Stated in a different light, delivery of the titles to the named owners is not a pre-
requisite before all these CCTs can be legally categorized as genuine documents.
The fact that the same had already been signed by x x x Espenesin in his capacity
as Register of Deeds of Pasig City and the notations imprinted thereon appeared
to have been entered on March 11, 2005 at 11:55 a.m. at the Registry Books of
Pasig City, the CCTs in issue are bound to be treated as genuine documents
drafted and signed in the regular performance of duties of the officer whose
signature appears thereon. The law has made it so clear that it is the entry of the
title in the Registration Book that controls the discretion of the Register of Deeds to
effect the necessary amendments and not the actual delivery of the titles to the
named owners.
This being the case, strict compliance with the mandates of Section 108 of P.D.
1529 is strictly called for. The provision is clear that upon entry of a certificate of
title (which definitely includes Condominium Certificate of Title) attested to by the
Register of Deeds, no amendment shall be effected thereon except upon lawful
order of the court.
In the instant case, it became obvious that after the CCTs of ASB were entered in
the Registration Book on March 11, 2005 at exactly 11:55 a.m., the notations
thereon were thereafter amended by Espenesin when Atty. Serrano purportedly
informed him of the alleged error inscribed therein. The proper remedy that should
have been undertaken by Espenesin soon after he was informed of the error is to
either initiate the appropriate petition himself or to suggest to the parties to the
MOA to file said petition in court for the amendment of the CCTs. An amendment
by way of a shortcut is not allowed after entry of the title in the Registration Book.
xxxx
If the Regional Trial Court sitting as a land registration court is not legally
authorized to determine the respective rights of the parties to the MOA when
deciding on the petition for amendment and cancellation of title, all the more with
the Registrar of Deeds who is legally not empowered to make such determination
and to cause an automatic amendment of entries in the Registration Book on the
basis of his unauthorized determination.
Espenesin’s liability is grounded on the untimely and unauthorized amendment of
the CCTs in issue. This is regardless of whether the amendment had made the
CCTs speak of either a lie or the truth. What defines his error is his inability to
comply with the proper procedure set by law.33 (Emphasis supplied).
We likewise stress that the determination of probable cause does not require
certainty of guilt for a crime. As the term itself implies, probable cause is
concerned merely with probability and not absolute or even moral certainty; 34 it is
merely based on opinion and reasonable belief.35 It is sufficient that based on the
preliminary investigation conducted, it is believed that the act or omission
complained of constitutes the offense charged. Well-settled in jurisprudence, as in
Raro v. Sandiganbayan,36 that:
x x x Probable cause has been defined as the existence of such facts and
circumstances as would excite the belief, in a reasonable mind, acting on the facts
within the knowledge of the prosecutor, that the person charged was guilty of the
crime for which he was prosecuted.37
Probable cause is a reasonable ground for presuming that a matter is or may be
well-founded on such state of facts in the prosecutor's mind as would lead a
person of ordinary caution and prudence to believe — or entertain an honest or
strong suspicion — that it is so.38
A finding of probable cause needs only to rest on evidence showing that more
likely than not a crime has been committed and there is enough reason to believe
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that it was committed by the accused. It need not be based on clear and
convincing evidence of guilt, neither on evidence establishing absolute certainty of
guilt.39
A finding of probable cause does not require an inquiry into whether there is
sufficient evidence to procure a conviction. It is enough that it is believed that the
act or omission complained of constitutes the offense charged. Precisely, there is a
trial for the reception of evidence of the prosecution in support of the charge. 40
A finding of probable cause merely binds over the suspect to stand trial. It is not a
pronouncement of guilt.
The term does not mean "actual and positive cause" nor does it import absolute
certainty. It is merely based on opinion and reasonable belief. x x x Probable
cause does not require an inquiry into whether there is sufficient evidence to
procure a conviction.41 (Emphasis and italics supplied).
In this instance, Espenesin explains and categorically admits that he altered, nay
corrected, 38 certificates of title which we again reproduce for easy reference:
Sometime ago Serrano requested that condominium titles over specified units be
issued in consonance with the sharing in the joint venture MOA. Titles were
correspondingly issued as per request, some in the name of MICO and some in
the name of ASB. Before its release to the parties, Atty. Serrano came back and
requested that some titles issued in the name of ASB be changed to MICO
because allegedly there was error in the issuance.
Believing it was a simple error and on representation of the person we came to
know and considered the representative of both parties, we erased the name ASB
Realty Corporation on those specified titles and placed instead the name Malayan
Insurance Company.
To our mind, the purpose was not to transfer ownership but merely to rectify an
error committed in the issuance of titles. And since they were well within our
capacity to do, the titles not having been released yet to its owner, we did what we
believed was a simple act of rectifying a simple mistake.42
The letter of Espenesin itself underscores the existence of a prima facie case of
gross negligence:
1. Serrano transacted the registration of the units in The Malayan Tower
with the Office of the Register of Deeds, Pasig City;
2. Serrano had previously presented a joint venture agreement, the MOA,
which Espenesin followed in the initial preparation and issuance of the
titles;
3. Before some CCTs initially issued in ASB’s name were released,
Serrano returned and requested that some titles issued in the name of
ASB be changed to MICO because those titles were supposedly
erroneously registered to ASB; and
4. Just on Serrano’s utterance and declaration which Espenesin readily
believed because he considered Serrano the representative of both
parties, and without any other documentation to base the amendment on,
Espenesin erased the name of ASB on those specified titles and replaced
it with the name of MICO.
Espenesin, a Registrar of Deeds, relied on Serrano’s word alone that a supposed
error has been committed. Even if ownership of the units covered by the amended
CCTs has not been categorically declared as ASB’s given the ongoing dispute
between the parties, the MOA which Espenesin had previously referred to,
allocates those units to ASB:
Section 4. Distribution and Disposition of Units. (a) As a return of its capital
investment in the Project, each party shall be entitled to such portion of all the net
saleable area of the Building that their respective contributions to the Project bear
to the actual construction cost. As of the date of the execution hereof, and on the
basis of the total costs incurred to date in relation to the Remaining Construction
Costs (as defined in Section 9(a) hereof), the parties shall respectively be entitled
to the following (which entitlement shall be conditioned on, and subject to,
adjustments as provided in sub-paragraph (b) of Section 4 in the event that the
actual remaining cost of construction exceeds the Remaining Construction Cost):
(i) MICO – the net saleable area particularly described in Schedule
2 hereof.
(ii) ASB – the following net saleable area:
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 (A) the net saleable area which ASB had pre-sold for an aggregate
purchase price of ₱640,085,267.30 as set forth in Schedule 1 (including all
paid and unpaid proceeds of said pre-sales);
(B) the net saleable area particularly described in Schedule 3 hereof which
shall be delivered to ASB upon completion of the Project; and,
(C) provided that the actual remaining construction costs do not exceed
the Remaining Construction Cost, the net saleable area particularly
described in Schedule 4 hereof which shall be delivered to ASB upon
completion of the Project and determination of its actual construction
costs. If the actual remaining construction costs exceed the Remaining
Construction Cost, sub-paragraph (b) of this Section 4 shall apply.43
The MOA even recognizes and specifies that:
E. ASB has pre-sold a number of condominium units in the Project to certain
buyers as set forth in Schedule 1 hereof, and in order to protect the interests of
these buyers and preserve the interest in the Project, the goodwill and business
reputation of Malayan, Malayan has proposed to complete the Project, and ASB
has accepted such proposal, subject to the terms and conditions contained herein,
including the contribution to the Project (a) by Malayan of the Lot and (b) by ASB
of its interest as buyer under the Contract to Sell.
xxxx
Section 3. Recognition of ASB’s Investment. The parties confirm that as of the date
hereof, ASB invested in the Project an amount equivalent to its entitlement to the
net saleable area of the Building under Section 4 below, including ASB’s interest
as buyer under the Contract to Sell.44
One fact deserves emphasis. The ownership of the condominium units remains in
dispute and, by necessary inference, does not lie as well in MICO. By his baseless
reliance on Serrano’s word and representation, Espenesin allowed MICO to gain
an unwarranted advantage and benefit in the titling of the 38 units in The Malayan
Tower.
That a prima facie case for gross negligence amounting to violation of Sections
3(a) and (e) of Republic Act No. 3019 exists is amply supported by the fact that
Espenesin disregarded the well-established practice necessitating submission of
required documents for registration of property in the Philippines:
Documents Required for Registration of Real Property with the Register of Deeds:
1. Common Requirements
o Original copy of the Deed or Instrument (Original Copy + 2
duplicate copies)If the original copy cannot be produced, the
duplicate original or certified true copy shall be presented
accompanied with a sworn affidavit executed by the interested
party why the original copy cannot be presented.
o Owner’s copy of the Certificate of Title or Co-owner’s copy if one
has been issued. (Original Copy + 2 duplicate copies)
o Latest Tax Declaration if the property is an unregistered land.
(Original Copy + 2 duplicate copies)
2. Specific Requirements
1. Deed of Sale/Transfer
xxxx
 For Corporation
1. Secretary’s Certificate or Board Resolution to Sell or
Purchase (Original Copy + Duplicate Copy)
2. Articles of Incorporation (for transferee corporation) (1
Certified Copy of the Original)
3. Certificate of the Securities and Exchange Commission
(SEC) that the Articles of Incorporation had been
registered . (1 Certified Copy of the Original)
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 4. For Condominium or Condominium Certificate of
Transfer, affidavit/certificate of the Condominium
Corporation that the sale/transfer does not violate the 60-
40 rule.(Original Copy + 1 Duplicate Copy)
5. Subsequent transfer of CCT requires Certificate of the
Condominium Management. (Original Copy)
6. Sale by a Corporation Sole, court order is
required.(Original copy of the Court Order)
Additional Requirements
xxxx
11. Condominium Projects
 Master Deed (Original Copy + 1 Duplicate Copy)
 Declaration of Restriction (Original Copy + 1 Duplicate
Copy)
 Diagrammatic Floor Plan (Original Copy + 1 Duplicate
Copy)
If the Condominium Certificate of Title is issued for the first time in
the name of the registered owner, require the following:
o Certificate of Registration with the Housing and Land
Use Regulatory Board (Original Copy + 1 Duplicate Copy)
o Development Permit (Original Copy + 1 Duplicate Copy)
o License to Sell (Original Copy + 1 Duplicate Copy) 45
Espenesin, by his own explanation, relied on nothing more than Serrano, who he
"came to know and considered as representative of both parties," and Serrano’s
interpretation of the MOA that Serrano had brought with him.
On the whole, there is sufficient ground to engender a well-founded belief that
respondents Espenesin and Serrano committed prohibited acts listed in Sections
3(a) and (e) of Republic Act No. 3019.
As regards Yuchengco and Cheng, apart from Ampil’s general assertions that the
two, as officers of MICO, benefited from the alteration of the CCTs, there is a
dearth of evidence pointing to their collective responsibility therefor. While the fact
of alteration was admitted by respondents and was affirmed in the Ombudsman’s
finding of fact, there is nothing that directly links Yuchengco and Cheng to the act.
We are aware that the calibration of evidence to assess whether a prima facie graft
case exists against respondents is a question of fact. We have consistently held
that the Supreme Court is not a trier of facts, more so in the consideration of the
extraordinary writ of certiorari where neither questions of fact nor law are
entertained, but only questions of lack or excess of jurisdiction or grave abuse of
discretion.46 In this case, however, certiorari will lie, given that the Ombudsman
made no finding at all on respondents possible liability for violation of Sections 3(a)
and (e) of Republic Act No. 3019.
We hasten to reiterate that we are only dealing herein with the preliminary
investigation aspect of this case. We do not adjudge respondents’ guilt or the lack
thereof. The assertions of Espenesin and Serrano on the former’s good faith in
effecting the alteration and the pending arbitration case before the Construction
Industry Arbitration Commission involving the correct division of MICO’s and ASB’s
net saleable areas in The Malayan Tower are matters of defense which they
should raise during trial of the criminal case.
As regards the administrative liability of Espenesin, the basic principle in the law of
public officers is the three-fold liability rule, which states that the wrongful acts or
omissions of a public officer, Espenesin in these cases, may give rise to civil,
criminal and administrative liability. An action for each can proceed independently
of the others.47
On this point, we find that the appellate court erred when it affirmed the
Ombudsman’s last ruling that Espenesin is not administratively liable.
Misconduct is a transgression of some established and definite rule of action, more
particularly, unlawful behavior or gross negligence by a public officer. 48
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In Grave Misconduct, as distinguished from Simple Misconduct, the elements of
corruption, clear intent to violate the law or flagrant disregard of established rules,
must be manifest49 and established by substantial evidence. Grave Misconduct
necessarily includes the lesser offense of Simple Misconduct. 50 Thus, a person
charged with Grave Misconduct may be held liable for Simple Misconduct if the
misconduct does not involve any of the elements to qualify the misconduct as
grave.51
In (G.R. No. 199115), the elements particular to Grave Misconduct are, by the
Ombudsman’s own finding, present. Corruption, as an element of Grave
Misconduct, consists in the act of an official or fiduciary person who unlawfully and
wrongfully uses his station or character to procure some benefit for himself or for
another person, contrary to duty and the rights of others.52 This has already been
demonstrated as discussed above. And, there is here a manifest disregard for
established rules on land registration by a Register of Deeds himself. As he
himself admits in his letter, Espenesin erased the name of ASB on the specified
CCTs because he believed that Serrano’s request for the re-issuance thereof in
MICO’s name constituted simple error.
Section 108 of Presidential Decree No. 1529 provides:
Section 108. Amendment and alteration of certificates. No erasure, alteration, or
amendment shall be made upon the registration book after the entry of a certificate
of title or of a memorandum thereon and the attestation of the same be Register of
Deeds, except by order of the proper Court of First Instance. A registered owner of
other person having an interest in registered property, or, in proper cases, the
Register of Deeds with the approval of the Commissioner of Land Registration,
may apply by petition to the court upon the ground that the registered interests of
any description, whether vested, contingent, expectant or inchoate appearing on
the certificate, have terminated and ceased; or that new interest not appearing
upon the certificate have arisen or been created; or that an omission or error was
made in entering a certificate or any memorandum thereon, or, on any duplicate
certificate; or that the same or any person on the certificate has been changed; or
that the registered owner has married, or, if registered as married, that the
marriage has been terminated and no right or interests of heirs or creditors will
thereby be affected; or that a corporation which owned registered land and has
been dissolved has not convened the same within three years after its dissolution;
or upon any other reasonable ground; and the court may hear and determine the
petition after notice to all parties in interest, and may order the entry or cancellation
of a new certificate, the entry or cancellation of a memorandum upon a certificate,
or grant any other relief upon such terms and conditions, requiring security or bond
if necessary, as it may consider proper; Provided, however, That this section shall
not be construed to give the court authority to reopen the judgment or decree of
registration, and that nothing shall be done or ordered by the court which shall
impair the title or other interest of a purchaser holding a certificate for value and in
good faith, or his heirs and assigns, without his or their written consent. Where the
owner's duplicate certificate is not presented, a similar petition may be filed as
provided in the preceding section.
The foregoing clearly speaks of a court order prior to any erasure, alteration or
amendment upon a certificate of title.
In reversing its prior ruling, the Ombudsman cavalierly dismisses the fact of
Espenesin already signing the CCTs issued in ASB’s name as "only a part of the
issuance process because the final step in the titling procedure is indeed the
release of the certificate of title."53 The Ombudsman further ruled:
Considering that prior to the release of titles, Espenesin merely rectified what was
represented to this office as error in the preparation of typing or the certificates,
hence, it is wrong to subject him to an administrative sanction. This is bolstered by
the fact that, at the time of release (and perhaps even up to the present time),
there was no final determination yet from the land registration court as to who has
a better right to the property in question.54(Emphasis supplied).
This statement of the Ombudsman is virtually a declaration of Espenesin’s
misconduct. It highlights Espenesin’s awareness and knowledge that ASB and
MICO are two different and separate entities, albeit having entered into a joint
venture for the building of "The Malayan Tower."
As Registrar of Deeds, Espenesin was duty bound to inquire and ascertain the
reason for Serrano’s new instruction on those specific set of CCTs and not just
heed Serrano’s bidding. He heads the Office of Register of Deeds which is
constituted by law as "a public repository of records of instruments affecting
registered or unregistered lands x x x in the province or city wherein such office is
situated." He should not have so easily taken Serrano’s word that the amendment
Serrano sought was to correct simple and innocuous error. Espenesin could have
then easily asked, as he is obliged to, for a contract or an authenticated writing to
ascertain which units and parking slots were really allotted for ASB and MICO. His
actions would then be based on what is documented and not merely by a lame
claim of bona fides mistake.
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Moreover, Espenesin was previously presented a MOA, and consulted this same
MOA, in the initial preparation and issuance of the 38 CCTs in ASB’s name.
Certainly, a Registrar of Deeds who is required by law to be a member of the legal
profession,55 possesses common sense and prudence to ask for documents on
which to base his corrections. Reliance on the mere word of even the point person
for the transaction, smacks of gross negligence when all transactions with the
Office of the Register of Deeds, involving as it does registration of property, ought
to be properly recorded and documented.
That the Office of the Register of Deeds requires documentation in the registration
of property, whether as an original or a subsequent registration, brooks no
argument. Again, and it cannot be overlooked that, Espenesin initially referred to a
MOA albeit Serrano worked on the registration transaction for both ASB and
MICO. Subsequently, Serrano returns, bearing ostensible authority to transact
even for ASB, and Espenesin fails to ask for documentation for the correction
Serrano sought to be made, and simply relies on Serrano’s word.
We are baffled by the Registrar of Deeds’ failure to require documentation which
would serve as his basis for the correction. The amendment sought by Serrano
was not a mere clerical change of registered name; it was a substantial one,
changing ownership of 38 units in The Malayan Tower from one entity, ASB, to
another, MICO. Even just at Serrano’s initial request for correction of the CCTs, a
red flag should have gone up for a Registrar of Deeds.1âwphi1
Espenesin splits hairs when he claims that it is "in the Registration Book where the
prohibition to erase, alter, or amend, without court order, applies." We disagree
with Espenesin. Chapter IV on Certificate of Title of Presidential Decree No.
1529,56 specifically Sections 40, 42 and 43 belie the claim of Espenesin:
Section 40. Entry of Original Certificate of Title. Upon receipt by the Register of
Deeds of the original and duplicate copies of the original certificate of title the
same shall be entered in his record book and shall be numbered, dated, signed
and sealed by the Register of Deeds with the seal of his office. Said certificate of
title shall take effect upon the date of entry thereof. The Register of Deeds shall
forthwith send notice by mail to the registered owner that his owner's duplicate is
ready for delivery to him upon payment of legal fees.
Section 42. Registration Books. The original copy of the original certificate of title
shall be filed in the Registry of Deeds. The same shall be bound in consecutive
order together with similar certificates of title and shall constitute the registration
book for titled properties.
Section 43. Transfer Certificate of Title. The subsequent certificate of title that may
be issued by the Register of Deeds pursuant to any voluntary or involuntary
instrument relating to the same land shall be in like form, entitled "Transfer
Certificate of Title", and likewise issued in duplicate. The certificate shall show the
number of the next previous certificate covering the same land and also the fact
that it was originally registered, giving the record number, the number of the
original certificate of title, and the volume and page of the registration book in
which the latter is found.
Recording or entry of the titles, whether an original or a subsequent transfer
certificate of title in the record, is simultaneous with the signing by the Register of
Deeds. The signature on the certificate by the Registrar of Deeds is accompanied
by the dating, numbering and sealing of the certificate. All these are part of a single
registration process. Where there has been a completed entry in the Record Book,
as in this case where the Ombudsman found that "the signature of Espenesin is
already affixed on the CCTs, and on its face, it was explicitly declared that the titles
have already been entered in the Registration Book of the Register of Deeds of
Pasig City on March 11, 2005 at 11:55 a.m.," the Register of Deeds can no longer
tamper with entries, specially the very name of the titleholder. The law says that
the certificate of title shall take effect upon the date of entry thereof.
To further drive home the point, as Registrar of Deeds, Espenesin knew full well
that "there is no final determination yet from the land registration court as to who
has a better right to the property in question." Espenesin’s attempt to minimize the
significance of a Registrar of Deed’s signature on a CCT only aggravates the lack
of prudence in his action. The change in the titleholder in the CCTs from ASB to
MICO was an official documentation of a change of ownership. It definitely cannot
be characterized as simple error.
Grave misconduct, of which Espenesin has been charged, consists in a public
officer’s deliberate violation of a rule of law or standard of behavior. It is regarded
as grave when the elements of corruption, clear intent to violate the law, or flagrant
disregard of established rules are present.57 In particular, corruption as an element
of grave misconduct consists in the official’s unlawful and wrongful use of his
station or character to procure some benefit for himself or for another person,
contrary to duty and the rights of others.58
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In sum, the actions of Espenesin clearly demonstrate a disregard of well-known
legal rules.59 The penalty for Grave Misconduct is dismissalfrom service with the
accessory penalties of forfeiture of retirement benefits, cancellation of eligibility,
and perpetual disqualification from reemployment in the government service,
including government-owned or controlled corporation.60
WHEREFORE, the petition in G.R. No. 192685 is PARTIALLY GRANTED. The
Resolution of the Ombudsman dated 30 April 2008 in OMB-C-C-07-0444-J is
REVERSED and SET ASIDE. The Ombudsman is hereby directed to file the
necessary Information for violation of Sections 3(a) and (e) of Republic Act No.
3019 against public respondent Policarpio L. Espenesin and private respondent
Francis Serrano.
The petition in G.R. No. 199115 is GRANTED. The Decision of the Court of
Appeals dated 28 September 2011 in CA-G.R. SP No. 113171 and the Order
dated 13 July 2009 of the Ombudsman in OMB-C-A-07-0474-J are REVERSED
and SET ASIDE. Respondent Policarpio L. Espenesin is GUlLTY of Grave
Misconduct and we, thus, impose the penalty of DIMISSAL from service. However,
due to his retirement from the service, we order forfeiture of all his retirement pay
and benefits.
SO ORDERED.
G.R. No. 200804 January 22, 2014
A.L. ANG NETWORK, INC., Petitioner,
vs.
EMMA MONDEJAR, accompanied by her husband, EFREN
MONDEJAR, Respondent.
RESOLUTION
PERLAS-BERNABE, J.:
This is a direct recourse1 to the Court from the Decision2 dated November 23,
2011and Order3 dated February 16, 2012 of the Regional Trial Court of Bacolod
City, Branch 45 (RTC) in RTC Case No. 11-13833 which dismissed, on the ground
of improper remedy, petitioner A.L. Ang Network, Inc.'s (petitioner) petition for
certiorari from the Decision4 dated June 10, 2011 of the Municipal Trial Court in
Cities of Bacolod City, Branch 4 (MTCC) in Civil Case No. SCC-1436, a small
claims case for sum of money against respondent Emma Mondejar (respondent).
The Facts
On March 23, 2011, petitioner filed a complaint5 for sum of money under the Rule
of Procedure for Small Claims Cases6 before the MTCC, seeking to collect from
respondent the amount of ₱23,111.71 which represented her unpaid water bills for
the period June 1, 2002 to September 30, 2005.7
Petitioner claimed that it was duly authorized to supply water to and collect
payment therefor from the homeowners of Regent Pearl Subdivision, one of whom
is respondent who owns and occupies Lot 8, Block 3 of said subdivision. From
June 1, 2002 until September 30, 2005, respondent and her family consumed a
total of 1,150 cubic meters (cu. m.) of water, which upon application of the agreed
rate of ₱113.00 for every 10 cu. m. of water, plus an additional charge of ₱11.60
for every additional cu. m. of water, amounted to ₱28,580.09.8 However,
respondent only paid the amount of ₱5,468.38, thus, leaving a balance of
₱23,111.71 which was left unpaid despite petitioner’s repeated demands. 9
In defense, respondent contended that since April 1998 up to February 2003, she
religiously paid petitioner the agreed monthly flat rate of ₱75.00 for her water
consumption. Notwithstanding their agreement that the same would be adjusted
only upon prior notice to the homeowners, petitioner unilaterally charged her
unreasonable and excessive adjustments (at the average of 40 cu. m. of water per
month or 1.3 cu. m. of water a day) far above the average daily water consumption
for a household of only 3 persons. She also questioned the propriety and/or basis
of the aforesaid ₱23,111.71 claim.10
In the interim, petitioner disconnected respondent’s water line for not paying the
adjusted water charges since March 2003 up to August 2005.11
The MTCC Ruling
On June 10, 2011, the MTCC rendered a Decision12 holding that since petitioner
was issued a Certificate of Public Convenience (CPC)13 by the National Water
Resources Board (NWRB) only on August 7, 2003, then, it can only charge
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respondent the agreed flat rate of ₱75.00 per month prior thereto or the sum of
₱1,050.00 for the period June 1, 2002 to August 7, 2003. Thus, given that
respondent had made total payments equivalent to ₱1,685.99 for the same period,
she should be considered to have fully paid petitioner.14
The MTCC disregarded petitioner’s reliance on the Housing and Land Use
Regulatory Board’s (HLURB) Decision15dated August 17, 2000 in HLURB Case
No. REM C6-00-001 entitled Nollie B. Apura, et al. v. Dona Carmen I Subdivision,
et al., as source of its authority to impose new water consumption rates for water
consumed from June 1, 2002 to August 7, 2003 in the absence of proof (a) that
petitioner complied with the directive to inform the HLURB of the result of its
consultation with the concerned homeowners as regards the rates to be charged,
and (b) that the HLURB approved of the same.16
Moreover, the MTCC noted that petitioner failed to submit evidence showing (a)
the exact date when it actually began imposing the NWRB approved rates; and (b)
that the parties had a formal agreement containing the terms and conditions
thereof, without which it cannot establish with certainty respondent’s
obligation.17 Accordingly, it ruled that the earlier agreed rate of ₱75.00 per month
should still be the basis for respondent’s water consumption charges for the period
August 8, 2003 to September 30, 2005.18 Based on petitioner’s computation,
respondent had only paid ₱300.00 of her ₱1,500.00 obligation for said period.
Thus, it ordered respondent to pay petitioner the balance thereof, equivalent to
₱1,200.00 with legal interest at the rate of 6% per annum from date of receipt of
the extrajudicial demand on October 14, 2010 until fully paid.19
Aggrieved, petitioner filed a petition for certiorari20 under Rule 65 of the Rules of
Court before the RTC, ascribing grave abuse of discretion on the part of the MTCC
in finding that it (petitioner) failed to establish with certainty respondent’s
obligation, and in not ordering the latter to pay the full amount sought to be
collected.
The RTC Ruling
On November 23, 2011, the RTC issued a Decision21 dismissing the petition for
certiorari, finding that the said petition was only filed to circumvent the non-
appealable nature of small claims cases as provided under Section 2322of the Rule
of Procedure on Small Claims Cases. To this end, the RTC ruled that it cannot
supplant the decision of the MTCC with another decision directing respondent to
pay petitioner a bigger sum than that which has been awarded.
Petitioner moved for reconsideration23 but was denied in an Order24 dated
February 16, 2012, hence, the instant petition.
The Issue Before the Court
The sole issue in this case is whether or not the RTC erred in dismissing
petitioner’s recourse under Rule 65 of the Rules of Court assailing the propriety of
the MTCC Decision in the subject small claims case.
The Court’s Ruling
The petition is meritorious.
Section 23 of the Rule of Procedure for Small Claims Cases states that:
SEC. 23. Decision. — After the hearing, the court shall render its decision on the
same day, based on the facts established by the evidence (Form 13-SCC). The
decision shall immediately be entered by the Clerk of Court in the court docket for
civil cases and a copy thereof forthwith served on the parties.
The decision shall be final and unappealable.
Considering the final nature of a small claims case decision under the above-
stated rule, the remedy of appeal is not allowed, and the prevailing party may,
thus, immediately move for its execution.25 Nevertheless, the proscription on
appeals in small claims cases, similar to other proceedings where appeal is not an
available remedy,26 does not preclude the aggrieved party from filing a petition for
certiorari under Rule 65 of the Rules of Court. This general rule has been
enunciated in the case of Okada v. Security Pacific Assurance
Corporation,27 wherein it was held that:
In a long line of cases, the Court has consistently ruled that "the extraordinary writ
of certiorari is always available where there is no appeal or any other plain, speedy
and adequate remedy in the ordinary course of law." In Jaca v. Davao Lumber Co.,
the Court ruled:
x x x Although Section 1, Rule 65 of the Rules of Court provides that the special
civil action of certiorari may only be invoked when "there is no appeal, nor any
plain, speedy and adequate remedy in the course of law," this rule is not without
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exception. The availability of the ordinary course of appeal does not constitute
sufficient ground to prevent a party from making use of the extraordinary remedy of
certiorari where appeal is not an adequate remedy or equally beneficial, speedy
and sufficient. It is the inadequacy – not the mere absence – of all other legal
remedies and the danger of failure of justice without the writ that usually
determines the propriety of certiorari.
This ruling was reiterated in Conti v. Court of Appeals:
Truly, an essential requisite for the availability of the extraordinary remedies under
the Rules is an absence of an appeal nor any "plain, speedy and adequate
remedy" in the ordinary course of law, one which has been so defined as a
"remedy which (would) equally (be) beneficial, speedy and sufficient not merely a
remedy which at some time in the future will bring about a revival of the judgment x
x x complained of in the certiorari proceeding, but a remedy which will promptly
relieve the petitioner from the injurious effects of that judgment and the acts of the
inferior court or tribunal" concerned. x x x (Emphasis supplied)
In this relation, it may not be amiss to placate the RTC’s apprehension that
respondent’s recourse before it (was only filed to circumvent the non-appealable
nature of [small claims cases], because it asks [the court] to supplant the decision
of the lower [c]ourt with another decision directing the private respondent to pay
the petitioner a bigger sum than what has been awarded." 28 Verily, a petition for
certiorari, unlike an appeal, is an original action29 designed to correct only errors of
jurisdiction and not of judgment. Owing to its nature, it is therefore incumbent upon
petitioner to establish that jurisdictional errors tainted the MTCC Decision. The
RTC, in turn, could either grant or dismiss the petition based on an evaluation of
whether or not the MTCC gravely abused its discretion by capriciously,
whimsically, or arbitrarily disregarding evidence that is material to the
controversy.30
In view of the foregoing, the Court thus finds that petitioner correctly availed of the
remedy of certiorari to assail the propriety of the MTCC Decision in the subject
small claims case, contrary to the RTC’s ruling.
Likewise, the Court finds that petitioner filed the said petition before the proper
forum (i.e., the RTC).1âwphi1 To be sure, the Court, the Court of Appeals and the
Regional Trial Courts have concurrent jurisdiction to issue a writ of
certiorari.31Such concurrence of jurisdiction, however, does not give a party
unbridled freedom to choose the venue of his action lest he ran afoul of the
doctrine of hierarchy of courts. Instead, a becoming regard for judicial hierarchy
dictates that petitions for the issuance of writs of certiorari against first level courts
should be filed with the Regional Trial Court, and those against the latter, with the
Court of Appeals, before resort may be had before the Court.32 This procedure is
also in consonance with Section 4, Rule 65 of the Rules of Court. 33
Hence, considering that small claims cases are exclusively within the jurisdiction of
the Metropolitan Trial Courts, Municipal Trial Courts in Cities, Municipal Trial
Courts, and Municipal Circuit Trial Courts,34 certiorari petitions assailing its
dispositions should be filed before their corresponding Regional Trial Courts. This
petitioner complied with when it instituted its petition for certiorari before the RTC
which, as previously mentioned, has jurisdiction over the same. In fine, the RTC
erred in dismissing the said petition on the ground that it was an improper remedy,
and, as such, RTC Case No. 11-13833 must be reinstated and remanded thereto
for its proper disposition.
WHEREFORE, the petition is GRANTED. The Decision dated November 23, 2011
and Resolution dated February 16, 2012 of the Regional Trial Court of Bacolod
City, Branch 45 are REVERSED and SET ASIDE. RTC Case No. 11-13833 is
hereby REINSTATED and the court a quo is ordered to resolve the same with
dispatch.
SO ORDERED.
G.R. No. 190566 December 11, 2013
MARK JEROME S. MAGLALANG, Petitioner,
vs.
PHILIPPINE AMUSEMENT AND GAMING CORPORATION (PAGCOR), as
represented by its incumbent Chairman EFRAIM GENUINO, Respondent.
DECISION
VILLARAMA, JR., J.:
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Before this Court is a petition1 for review on certiorari under Rule 45 of the 1997
Rules of Civil Procedure, as amended, seeking the reversal of the
Resolution2 dated September 30, 2009 issued by the Court of Appeals (CA) in
CA"".G.R. SP No. 110048, which outrightly dismissed the petition for certiorari filed
by herein petitioner Mark Jerome S. Maglalang (petitioner). Also assailed is the
appellate court's Resolution3 dated November 26, 2009 which denied petitioner's
motion for reconsideration.
The facts follow.
Petitioner was a teller at the Casino Filipino, Angeles City Branch, Angeles City,
which was operated by respondent Philippine Amusement and Gaming
Corporation (PAGCOR), a government-owned or controlled corporation existing by
virtue of Presidential Decree (P.D.) No. 1869.4
Petitioner alleged that in the afternoon of December 13, 2008, while he was
performing his functions as teller, a lady customer identified later as one Cecilia
Nakasato5 (Cecilia) approached him in his booth and handed to him an
undetermined amount of cash consisting of mixed ₱1,000.00 and ₱500.00 bills.
There were 45 ₱1,000.00 and ten ₱500.00 bills for the total amount of ₱50,000.00.
Following casino procedure, petitioner laid the bills on the spreading board.
However, he erroneously spread the bills into only four clusters instead of five
clusters worth ₱10,000.00 per cluster. He then placed markers for ₱10,000.00
each cluster of cash and declared the total amount of ₱40,000.00 to Cecilia.
Perplexed, Cecilia asked petitioner why the latter only dished out ₱40,000.00. She
then pointed to the first cluster of bills and requested petitioner to check the first
cluster which she observed to be thicker than the others. Petitioner performed a
recount and found that the said cluster contained 20 pieces of ₱1,000.00 bills.
Petitioner apologized to Cecilia and rectified the error by declaring the full and
correct amount handed to him by the latter. Petitioner, however, averred that
Cecilia accused him of trying to shortchange her and that petitioner tried to
deliberately fool her of her money. Petitioner tried to explain, but Cecilia allegedly
continued to berate and curse him. To ease the tension, petitioner was asked to
take a break. After ten minutes, petitioner returned to his booth. However, Cecilia
allegedly showed up and continued to berate petitioner. As a result, the two of
them were invited to the casino’s Internal Security Office in order to air their
respective sides. Thereafter, petitioner was required to file an Incident Report
which he submitted on the same day of the incident.6
On January 8, 2009, petitioner received a Memorandum 7 issued by the casino’s
Branch Manager, Alexander Ozaeta, informing him that he was being charged with
Discourtesy towards a casino customer and directing him to explain within 72
hours upon receipt of the memorandum why he should not be sanctioned or
dismissed. In compliance therewith, petitioner submitted a letter-
explanation8 dated January 10, 2009.
On March 31, 2009, petitioner received another Memorandum 9 dated March 19,
2009, stating that the Board of Directors of PAGCOR found him guilty of
Discourtesy towards a casino customer and imposed on him a 30-day suspension
for this first offense. Aggrieved, on April 2, 2009, petitioner filed a Motion for
Reconsideration10 seeking a reversal of the board’s decision and further prayed in
the alternative that if he is indeed found guilty as charged, the penalty be only a
reprimand as it is the appropriate penalty. During the pendency of said motion,
petitioner also filed a Motion for Production11 dated April 20, 2009, praying that he
be furnished with copies of documents relative to the case including the
recommendation of the investigating committee and the Decision/Resolution of the
Board supposedly containing the latter’s factual findings. In a letter-reply12 dated
June 2, 2009, one Atty. Carlos R. Bautista, Jr. who did not indicate his authority
therein to represent PAGCOR, denied the said motion. Petitioner received said
letter-reply on June 17, 2009.
Subsequently, on June 18, 2009, PAGCOR issued a Memorandum 13 dated June
18, 2009 practically reiterating the contents of its March 19, 2009 Memorandum.
Attached therewith is another Memorandum 14 dated June 8, 2009 issued by
PAGCOR’s Assistant Vice President for Human Resource and Development, Atty.
Lizette F. Mortel, informing petitioner that the Board of Directors in its meeting on
May 13, 2009 resolved to deny his appeal for reconsideration for lack of merit.
Petitioner received said memoranda on the same date of June 18, 2009.
On August 17, 2009, petitioner filed a petition15 for certiorari under Rule 65 of the
1997 Rules of Civil Procedure, as amended, before the CA, averring that there is
no evidence, much less factual and legal basis to support the finding of guilt
against him. Moreover, petitioner ascribed grave abuse of discretion amounting to
lack or excess of jurisdiction to the acts of PAGCOR in adjudging him guilty of the
charge, in failing to observe the proper procedure in the rendition of its decision
and in imposing the harsh penalty of a 30-day suspension. Justifying his recourse
to the CA, petitioner explained that he did not appeal to the Civil Service
Commission (CSC) because the penalty imposed on him was only a 30-day
suspension which is not within the CSC’s appellate jurisdiction. He also claimed
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that discourtesy in the performance of official duties is classified as a light offense
which is punishable only by reprimand.
In its assailed Resolution16 dated September 30, 2009, the CA outrightly dismissed
the petition for certiorari for being premature as petitioner failed to exhaust
administrative remedies before seeking recourse from the CA. Invoking Section
2(1), Article IX-B of the 1987 Constitution,17 the CA held that the CSC has
jurisdiction over issues involving the employer-employee relationship in all
branches, subdivisions, instrumentalities and agencies of the Government,
including government-owned or controlled corporations with original charters such
as PAGCOR. Petitioner filed his Motion for Reconsideration18 which the CA denied
in the assailed Resolution19 dated November 26, 2009. In denying the said motion,
the CA relied on this Court’s ruling in Duty Free Philippines v. Mojica 20 citing
Philippine Amusement and Gaming Corp. v. CA,21 where this Court held as
follows:
It is now settled that, conformably to Article IX-B, Section 2(1), [of the 1987
Constitution] government-owned or controlled corporations shall be considered
part of the Civil Service only if they have original charters, as distinguished from
those created under general law.
PAGCOR belongs to the Civil Service because it was created directly by PD 1869
on July 11, 1983. Consequently, controversies concerning the relations of the
employee with the management of PAGCOR should come under the jurisdiction of
the Merit System Protection Board and the Civil Service Commission, conformably
to the Administrative Code of 1987.
Section 16(2) of the said Code vest[s] in the Merit System Protection Board the
power inter alia to:
a) Hear and decide on appeal administrative cases involving officials and
employees of the Civil Service. Its decision shall be final except those involving
dismissal or separation from the service which may be appealed to the
Commission.
Hence, this petition where petitioner argues that the CA committed grave and
substantial error of judgment
1. IN OUTRIGHTLY DISMISSING THE PETITION FOR CERTIORARI
FILED BY PETITIONER AND IN DENYING THE LATTER’S MOTION
FOR RECONSIDERATION[;]
2. IN RULING THAT THE CIVIL SERVICE COMMISSION HAS
APPELLATE JURISDICTION OVER THE SUSPENSION OF THE
PETITIONER DESPITE THE FACT THAT THE PENALTY INVOLVED IS
NOT MORE THAN THIRTY (30) DAYS[;]
3. IN RESOLVING THE PETITION FOR CERTIORARI FILED BY
PETITIONER IN A MANNER WHICH IS UTTERLY CONTRARY TO LAW
AND JURISPRUDENCE[;]
4. IN UNJUSTIFIABLY REFUSING TO RENDER A DECISION AS TO
THE PROPRIETY OR VALIDITY OF THE SUSPENSION OF THE
PETITIONER BY THE RESPONDENT[;]
5. IN UNDULY REFUSING TO RENDER A DECISION DECLARING
THAT THE ASSAILED DECISIONS/RESOLUTIONS OF THE
RESPONDENT ARE NOT SUPPORTED BY THE EVIDENCE ON
RECORD[; AND]
6. IN UNJUSTIFIABLY REFUSING TO RENDER A DECISION
DECLARING THAT THE ASSAILED DECISIONS/RESOLUTIONS OF
RESPONDENT WERE ISSUED WITH GRAVE ABUSE OF DISCRETION
AMOUNTING TO LACK OR EXCESS OF JURISDICTION.22
Petitioner claims that the CA clearly overlooked the applicable laws and
jurisprudence that provide that when the penalty involved in an administrative case
is suspension for not more than 30 days, the CSC has no appellate jurisdiction
over the said administrative case. As authority, petitioner invokes our ruling in
Geronga v. Hon. Varela23which cited Section 47,24 Chapter 1, Subtitle A, Title I,
Book V of Executive Order (E.O.) No. 292 otherwise known as The Administrative
Code of 1987. Said Section 47 provides that the CSC may entertain appeals only,
among others, from a penalty of suspension of more than 30 days. Petitioner
asserts that his case, involving a 30-day suspension penalty, is not appealable to
the CSC. Thus, he submits that his case was properly brought before the CA via a
petition for certiorari.25
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On the other hand, PAGCOR alleges that petitioner intentionally omitted relevant
matters in his statement of facts. PAGCOR essentially claims that petitioner
refused to apologize to Cecilia; that he treated Cecilia’s complaint with arrogance;
and that before taking the aforementioned 10-minute break, petitioner slammed
the cash to the counter window in giving it back to the customer. PAGCOR argues
that the instant petition raises questions of fact which are not reviewable in a
petition for review on certiorari. PAGCOR maintains that the CA’s ruling was in
accordance with law and jurisprudence. Moreover, PAGCOR counters that
petitioner’s remedy of appeal is limited as Section 37 of the Revised Uniform Rules
on Administrative Cases in the Civil Service provides that a decision rendered by
heads of agencies whereby a penalty of suspension for not more than 30 days is
imposed shall be final and executory. PAGCOR opines that such intent of limiting
appeals over such minor offenses is elucidated in the Concurring Opinion of former
Chief Justice Reynato S. Puno in CSC v. Dacoycoy26 and based on the basic
premise that appeal is merely a statutory privilege. Lastly, PAGCOR submits that
the 30-day suspension meted on petitioner is justified under its own Code of
Discipline.27 Prescinding from the foregoing, the sole question for resolution is:
Was the CA correct in outrightly dismissing the petition for certiorari filed before it
on the ground of non-exhaustion of administrative remedies?
We resolve the question in the negative.
Our ruling in Public Hearing Committee of the Laguna Lake Development Authority
v. SM Prime Holdings, Inc.28 on the doctrine of exhaustion of administrative
remedies is instructive, to wit:
Under the doctrine of exhaustion of administrative remedies, before a party is
allowed to seek the intervention of the court, he or she should have availed himself
or herself of all the means of administrative processes afforded him or her. Hence,
if resort to a remedy within the administrative machinery can still be made by
giving the administrative officer concerned every opportunity to decide on a matter
that comes within his or her jurisdiction, then such remedy should be exhausted
first before the court's judicial power can be sought. The premature invocation of
the intervention of the court is fatal to one’s cause of action. The doctrine of
exhaustion of administrative remedies is based on practical and legal reasons. The
availment of administrative remedy entails lesser expenses and provides for a
speedier disposition of controversies. Furthermore, the courts of justice, for
reasons of comity and convenience, will shy away from a dispute until the system
of administrative redress has been completed and complied with, so as to give the
administrative agency concerned every opportunity to correct its error and dispose
of the case.
However, the doctrine of exhaustion of administrative remedies is not absolute as
it admits of the following exceptions:
(1) when there is a violation of due process; (2) when the issue involved is purely a
legal question; (3) when the administrative action is patently illegal amounting to
lack or excess of jurisdiction; (4) when there is estoppel on the part of the
administrative agency concerned; (5) when there is irreparable injury; (6) when the
respondent is a department secretary whose acts as an alter ego of the President
bears the implied and assumed approval of the latter; (7) when to require
exhaustion of administrative remedies would be unreasonable; (8) when it would
amount to a nullification of a claim; (9) when the subject matter is a private land in
land case proceedings; (10) when the rule does not provide a plain, speedy and
adequate remedy, and (11) when there are circumstances indicating the urgency
of judicial intervention, and unreasonable delay would greatly prejudice the
complainant; (12) where no administrative review is provided by law; (13) where
the rule of qualified political agency applies and (14) where the issue of non-
exhaustion of administrative remedies has been rendered moot.29
The case before us falls squarely under exception number 12 since the law per se
provides no administrative review for administrative cases whereby an employee
like petitioner is covered by Civil Service law, rules and regulations and penalized
with a suspension for not more than 30 days.
Section 37 (a) and (b) of P.D. No. 807, otherwise known as the Civil Service
Decree of the Philippines, provides for the unavailability of any appeal:
Section 37. Disciplinary Jurisdiction.
(a) The Commission shall decide upon appeal all administrative
disciplinary cases involving the imposition of a penalty of suspension for
more than thirty days, or fine in an amount exceeding thirty days’ salary,
demotion in rank or salary or transfer, removal or dismissal from Office. A
complaint may be filed directly with the Commission by a private citizen
against a government official or employee in which case it may hear and
decide the case or it may deputize any department or agency or official or
group of officials to conduct the investigation. The results of the
investigation shall be submitted to the Commission with recommendation
as to the penalty to be imposed or other action to be taken.
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 (b) The heads of departments, agencies and instrumentalities, provinces,
cities and municipalities shall have jurisdiction to investigate and decide
matters involving disciplinary action against officers and employees under
their jurisdiction. Their decisions shall be final in case the penalty imposed
is suspension for not more than thirty days or fine in an amount not
exceeding thirty days’ salary. In case the decision rendered by a bureau or
office head is appealable to the Commission, the same may be initially
appealed to the department and finally to the Commission and pending
appeal, the same shall be executory except when the penalty is removal,
in which case the same shall be executory only after confirmation by the
department head. (Emphasis supplied.)
Similar provisions are reiterated in the aforequoted Section 4730 of E.O. No. 292
essentially providing that cases of this sort are not appealable to the CSC.
Correlatively, we are not unaware of the Concurring Opinion of then Chief Justice
Puno in CSC v. Dacoycoy,31 where he opined, to wit:
In truth, the doctrine barring appeal is not categorically sanctioned by the Civil
Service Law.1âwphi1 For what the law declares as "final" are decisions of heads of
agencies involving suspension for not more than thirty (30) days or fine in an
amount not exceeding thirty (30) days salary. But there is a clear policy reason for
declaring these decisions final. These decisions involve minor offenses. They are
numerous for they are the usual offenses committed by government officials and
employees. To allow their multiple level appeal will doubtless overburden the
quasijudicial machinery of our administrative system and defeat the expectation of
fast and efficient action from these administrative agencies. Nepotism, however, is
not a petty offense. Its deleterious effect on government cannot be over-
emphasized. And it is a stubborn evil. The objective should be to eliminate nepotic
acts, hence, erroneous decisions allowing nepotism cannot be given immunity
from review, especially judicial review. It is thus non sequitur to contend that since
some decisions exonerating public officials from minor offenses can not be
appealed, ergo, even a decision acquitting a government official from
a major offense like nepotism cannot also be appealed.
Nevertheless, decisions of administrative agencies which are declared final and
unappealable by law are still subject to judicial review. In Republic of the Phils. v.
Francisco,32 we held:
Since the decision of the Ombudsman suspending respondents for one (1)
month is final and unappealable, it follows that the CA had no appellate
jurisdiction to review, rectify or reverse the same. The Ombudsman was not
estopped from asserting in this Court that the CA had no appellate jurisdiction to
review and reverse the decision of the Ombudsman via petition for review under
Rule 43 of the Rules of Court. This is not to say that decisions of the Ombudsman
cannot be questioned. Decisions of administrative or quasi-administrative
agencies which are declared by law final and unappealable are subject to
judicial review if they fail the test of arbitrariness, or upon proof of gross
abuse of discretion, fraud or error of law. When such administrative or quasi-
judicial bodies grossly misappreciate evidence of such nature as to compel a
contrary conclusion, the Court will not hesitate to reverse the factual
findings. Thus, the decision of the Ombudsman may be reviewed, modified or
reversed via petition for certiorari under Rule 65 of the Rules of Court, on a
finding that it had no jurisdiction over the complaint, or of grave abuse of
discretion amounting to excess or lack of jurisdiction.It bears stressing that
the judicial recourse petitioner availed of in this case before the CA is a special
civil action for certiorari ascribing grave abuse of discretion, amounting to lack or
excess of jurisdiction on the part of PAGCOR, not an appeal. Suffice it to state that
an appeal and a special civil action such as certiorari under Rule 65 are entirely
distinct and separate from each other. One cannot file petition for certiorari under
Rule 65 of the Rules where appeal is available, even if the ground availed of is
grave abuse of discretion. A special civil action for certiorari under Rule 65 lies
only when there is no appeal, or plain, speedy and adequate remedy in the
ordinary course of law. Certiorari cannot be allowed when a party to a case fails to
appeal a judgment despite the availability of that remedy, as the same should not
be a substitute for the lost remedy of appeal. The remedies of appeal and certiorari
are mutually exclusive and not alternative or successive.33
In sum, there being no appeal or any plain, speedy, and adequate remedy in the
ordinary course of law in view of petitioner's allegation that P AGCOR has acted
without or in excess of jurisdiction, or with grave abuse of discretion amounting to
lack or excess of jurisdiction, the CA's outright dismissal of the petition for certiorari
on the basis of non-exhaustion of administrative remedies is bereft of any legal
standing and should therefore be set aside.
Finally, as a rule, a petition for certiorari under Rule 65 is valid only when the
question involved is an error of jurisdiction, or when there is grave abuse of
discretion amounting to lack or excess of jurisdiction on the part of the court or
tribunals exercising quasi-judicial functions. Hence, courts exercising certiorari
jurisdiction should refrain from reviewing factual assessments of the respondent
court or agency. Occasionally, however, they are constrained to wade into factual
matters when the evidence on record does not support those factual findings; or
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when too much is concluded, inferred or deduced from the bare or incomplete
facts appearing on record.34 Considering the circumstances and since this Court is
not a trier of facts, 35 remand of this case to the CA for its judicious resolution is in
order.
WHEREFORE, the petition is PARTLY GRANTED. The Resolutions dated
September 30, 2009 and November 26, 2009 of the Court of Appeals in CA-G.R.
SP No. 110048 are hereby REVERSED and SET ASIDE. The instant case is
REMANDED to the Court of Appeals for further proceedings.
No pronouncement as to costs.
SO ORDERED.
G.R. No. 208290 December 11, 2013
PEOPLE OF THE PHILIPPINES, Petitioner,
vs.
THE HONORABLE JUANITO C. CASTANEDA, JR., HONORABLE CAESAR A.
CASANOVA, HONORABLE CIELITO N. MINDARO-GRULLA, AS ASSOCIATE
JUSTICES OF THE SPECIAL SECOND DIVISION, COURT OF TAX APPEALS;
and MYRNA M. GARCIA AND CUSTODIO MENDOZA VESTIDAS,
JR., Respondents.
RESOLUTION
PER CURIAM:
This is a petition for certiorari under Rule 65 of the Rules of Court seeking to
review the March 26, 20131 and May 15, 20132 Resolutions of the Court of Tax
Appeals (CTA) in CTA Crim. Case No. 0-285, ordering the dismissal of the case
against the private respondents for violation of Section 36023 in relation to
Sections 2503 and 2530 (f) (i) and 1, (3) (4) and (5) of the Tariff and Customs
Codeof the Philippines, as amended, on the ground of insufficiency of evidence.
The antecedentsas culled from the records:
Private respondents Myrna M. Garcia (Garcia) and Custodio Mendoza Vestidas,
Jr.(VestidasJr.)were charged before the CTA under an Information which reads:
That on or about November 5, 2011, or prior or subsequent thereto, in the City of
Manila, Philippines, and within the jurisdiction of this Honorable Court, the above-
named accused Myrna M. Garcia and Custodio Mendoza Vestidas, Jr. as
owner/proprietress and broker of Plinth Enterprise respectively, conspiring and
confederating with each other, with intent to defraud the government, did then and
there willfully, unlawfully and fraudulently import into the Port of Manila, 858
cartons of 17,160 pieces of Anti-Virus Software Kaspersky Internet Security
Premium 2012, subject to customs duties,by misdeclaration under Import Entry
No. C-181011 and Bill of Lading No. PFCMAN1715, filed with the Bureau of
Customs (BOC),covering One Forty Footer (1x40) container van shipment bearing
No. KKFU7195683 which was falsely declared to contain 40 pallets/1,690 cartons
of CD kit cleaner and plastic CD case, said imported items having customs duties
amounting to Three Million Three Hundred Forty One Thousand Two Hundred
Forty Five Pesos (Php 3,341,245) of which only the amount of One Hundred
Thousand Three Hundred Sixty Two Pesos (Php100,362) was paid, in violation of
the above-captioned law, and to the prejudice and damage of the Government in
the amount of Three Million Two Hundred Forty Thousand Eight Hundred Eighty
Three Pesos (Php3,240,883).4
In a hearing held on August 1, 2012, Garcia and VestidasJr.pleaded "Not Guilty" to
the aforementioned charge. Thereafter, a preliminary conference was held on
September 5, 2012 followed by thepre-trial on September 13, 2012. Both the
prosecution and the defense agreed to adopt the joint stipulations of facts and
issues entered in the course of the preliminary conference.
Thereafter, trial ensued.
The prosecution presented a number of witnesses whoessentially observed5 the
physical examination of Container Van No. KKFU 7195638 conducted6 by the
Bureau of Customs (BOC) and explained7 the process of electronic filing under the
Electronic to Mobile (E2M) Customs Systems of the BOC and the alleged
misdeclared goods therein.
Subsequent to the presentation of witnesses, the prosecution filed its Formal Offer
of Evidence on December 10, 2012.
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On January 15, 2013, Garcia and Vestidas, Jr. filed their Omnibus Motion to File
Demurrer to Evidence with Leave of Court to Cancel Hearing Scheduled on
January 21, 2013,whichwas grantedby the CTA. Thereafter, they filed theDemurrer
to Evidence, dated January 13, 2012, claimingthat the prosecution failed to prove
their guilt beyond reasonable doubt for the following reasons:
a)The pieces of documentary evidence submitted by the prosecution were
inadmissible incourt;
b)The object evidence consisting of the allegedly misdeclared goods were
not presented as evidence; and
c)None of the witnesses for the prosecution made a positive identification
of the two accused as the ones responsible for the supposed
misdeclaration.
Despite opposition, the CTA dismissed the caseagainst Garcia and Vestidas Jr.in
its March 26, 2013 Resolution, for failure of the prosecution to establish theirguilt
beyond reasonable doubt.
According to the CTA, "no proof whatsoever was presented by the prosecution
showing that the certified true copies of the public documents offered in evidence
against both accused were in fact issued by thelegal custodians." 8 It cited Section
26, Rule 132 of the Revised Rules of Court, whichprovidesthat"when the original of
a document is a public record, it should not generally be removed from the office or
place in which it is kept."9 As stated in Section 7, Rule 130,10 its contents may be
proven using secondary evidence and such evidence may pertain to the certified
true copy of the original document issued by the public officer in custody
thereof.Hence, the CTA wrotethat the certified true copiesof the public documents
offered in evidence should have been presented in court.
Anent its offer of private documents,11 the prosecution likewise failed to comply
with Section 27, Rule 132 of the Rules of Court, which reads, "[a]n authorized
public record of a private document may be proved by the original record, or by a
copy thereof, attested by the legal custodian of the record, with an appropriate
certificate that such officer has the custody." Considering that the private
documents were submitted and filed with the BOC, the same became part of public
records. Again, the records show that the prosecution failed to present the certified
true copies of thedocuments.
The CTA noted that,in its Opposition to the Demurrer,the prosecution even
admitted that none of their witnesses ever positively identified the accused in open
court and that the alleged misdeclared goods were not competently and properly
identified in court by any of the prosecution witnesses.
The prosecution filed its motion for reconsideration, but it was deniedby the CTAin
its May 15, 2013 Resolution, stressing, among others, that to grant it would place
the accused in double jeopardy.12
On July 24, 2013, the Run After the Smugglers (RATS) Group, Revenue Collection
Monitoring Group (RCMG), as counsel for the BOC, received a copy of the July 15,
2013 Resolution of the CTA ordering the entry of judgment in the case.
Hence,this petition for certiorari, ascribing grave abuse of discretion on the part of
theCTA when in ruled that: 1) the pieces of documentary evidence submitted by
the prosecution were inadmissible in evidence; 2) the object evidence consisting of
the alleged misdeclared goods were not presented as evidence; and 3) the
witnesses failed to positively identifythe accused as responsible forthe
misdeclaration of goods.
The Court agrees with the disposition of the CTA.
At the outset, it should be noted that the petition was filed beyond the reglementary
periodfor the filingthereof under Rule 65. The petition itself statedthat a copy of the
May 15, 2013 Resolution was received by the BOC two (2) days after its
promulgation, or on May 17, 2013. Nonetheless, the RATS was only alerted by the
developments in the case on July 24, 2013, when Atty. Danilo M. Campos Jr. (Atty.
Campos) received the July 15, 2013 Resolution of the CTA ordering the entry of
judgment in the case, considering that no appeal was taken by any of the parties.
According toAtty. Campos, it was only on that occasion when he discovered the
May 15, 2013 Resolution of the CTA.Thus, it was prayed that the petitionbe given
due course despite its late filing.
This belated filing cannot be countenanced by the Court.
Section 4, Rule 65 of the 1997 Rules of Civil Procedureis explicit in stating
thatcertiorarishould be instituted within a period of 60 days from notice of the
judgment, orderor resolution sought to be assailed. The 60-day period is
inextendible to avoid any unreasonable delay that would violate the constitutional
rights of parties to a speedy disposition of their case.13 While there are recognized
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exceptions14 to such strict observance, there should be an effort on the part of the
party invoking liberality to advance a reasonable or meritorious explanation for
his/her failure to comply with the rules.15
In the case at bench, no convincing justification for the belated filing of the petition
was advanced to warrant the relaxation of the Rules.Notably, the records show
that the petition was filedonly on August 12, 2013, or almost a month late from the
due date which fell on July 16, 2013. To excuse this grave procedural lapse will not
only be unfairto the other party, but it will also sanction a seeming rudimentary
attempt to circumvent standing rules of procedure. Suffice it to say, the reasons
proffered by the petitioner do not carry even a tinge of merit that would deserve
leniency.
The late filing of the petition was borne out of the petitioner’s failure to monitor
incoming court processes that neededto be addressed by the office. Clearly, this is
an admission of inefficiency, if not lack of zeal, on the part of an office tasked
toeffectively curb smuggling activities which rob the government of millions of
revenue every year.
The display of patent violations of even the elementary rules leads the Court to
suspectthat the case against Garcia and Vestidas Jr. was doomed by designfrom
the start. The failure to present the certified true copies of documentary evidence;
the failure to competently and properly identify the misdeclared goods; the failure
to identify the accused in court; and,worse, the failure to file this petition on time
challenging a judgment of acquittal, are tell-tale signs ofa reluctantand
subduedattitude in pursuing the case. This stance taken by the lawyers in
government service rouses the Court’s vigilance against inefficiency in the
administration of justice. Verily, the lawyersrepresenting the offices under the
executive branchshould be reminded that theystill remain as officers of the
courtfrom whom a high sense of competence and fervor is expected. The Courtwill
not close its eyes to this sense of apathy in RATS lawyers, lest the government’s
goal of revenue enhancement continues to suffer the blows of smuggling and
similar activities.
Even the error committed by the RATS in filing a motion for reconsideration with
the CTA displays gross ignorance as to the effects of an acquittal in a criminal
case and the constitutional proscription on double jeopardy. Had the RATS been
eager and keen in prosecuting the respondents, it would have, in the first place,
presented its evidence with the CTA in strict compliance with the Rules.
In any case, even if the Court decides to suspend the rules and permit this
recourse, the end result would remain the same. While a judgment of acquittal in a
criminal case may be assailed in a petition for certiorari under Rule 65 of the Rules
of Court,it must be shown that there was grave abuse of discretion amounting to
lack or excess of jurisdiction or a denial of due process.In this case, a perusal of
the challenged resolutions ofthe CTAdoes not disclose any indication of grave
abuse of discretion on its partor denial of due process.The records are replete with
indicators that the petitioner actively participated during the trial and, in fact,
presented its offer of evidence and opposed the demurrer.1âwphi1
Grave abuse of discretion is defined as capricious or whimsical exercise of
judgment as is equivalent to lack of jurisdiction. The abuse of discretion must be
patent and gross as to amount to an evasion of a positive duty or a virtual refusal
to perform a duty enjoined by law, or to act at all in contemplation of law, as where
the power is exercised in an arbitrary and despotic manner by reason of passion
and hostility.16 Here, the subject resolutions of the CTA have been issued in
accordance with the rules on evidence and existing jurisprudence.
On a final note, the Court deems it proper to remind the lawyers in the Bureau of
Customs that the canons embodied in the Code of Professional Responsibility
equally apply to lawyers in government service in the discharge of their official
tasks. 17 Thus, RA TS lawyers should exert every effort and consider it their duty to
assist in the speedy and efficient administration of justice.18
WHEREFORE, the petition is DISMISSED and the assailed March 26, 2013 and
May 15, 2013 Resolutions of the Court of Tax Appeals are AFFIRMED.
The Office of the Ombudsman is hereby ordered to conduct an investigation for
possible criminal or administrative offenses committed by the Run After the
Smugglers (RA TS) Group, Revenue Collection Monitoring Group (RCMG),
Bureau of Customs, relative to the filing and handling of the subject complaint for
violations of the Tariff and Customs Code of the Philippines.
Let copies of this resolution be furnished the Office of the President, the Secretary
of Finance, the Collector of Customs, and the Office of the Ombudsman for their
guidance and appropriate action.
SO ORDERED.
Page 105 of 507
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G.R. No. 110280 October 12, 1993
UNIVERSITY OF THE PHILIPPINES BOARD OF REGENTS and DR. OLIVIA C.
CAOILI in her capacity as Secretary of the Board, petitioners,
vs.
HON. ELSIE LIGOT-TELAN in her capacity as Presiding Judge of Branch 87,
Regional Trial Court of Quezon City and RAMON P. NADAL, respondents.
U.P. Office of Legal Services for petitioners.
Bonifacio A. Alentajon for private respondent.
ROMERO, J.:
In an effort to make the University of the Philippines (U.P.) truly the university of
the people, the U.P. administration conceptualized and implemented the socialized
scheme of tuition fee payments through the Socialized Tuition Fee and Assistance
Program (STFAP), popularly known as the "Iskolar ng Bayan" program. Spawned
by the public clamor to overcome what was perceived as the sharpening elitist
profile of the U.P studentry, the STFAP aspired to expand the coverage of
government educational subsidies so as to include the deserving in the lower
rungs of the socio-economic ladder.
After broad consultations with the various university constituencies by U.P.
President Jose V. Abueva, the U.P. Board of Regents issued on April 28, 1988 a
Resolution establishing the STFAP. A year later, it was granted official recognition
when the Congress of the Philippines allocated a portion of the National Budget for
the implementation of the program.
In the interest of democratizing admission to the State University, all students are
entitled to apply for STFAP benefits which include reduction in fees, living and
book subsidies and student assistantships which give undergraduate students the
opportunity to earn P12.00 per hour by working for the University.
Applicants are required to accomplish a questionnaire where, among others, they
state the amount and source of the annual income of the family, their real and
personal properties and special circumstances from which the University may
evaluate their financial status and need on the basis of which they are categorized
into brackets. At the end the application form, the student applicant, as well as his
parent, signs a sworn statement, as follows:
Statement of the Student
I hereby certify, upon my honor, that all the data and information
which I have furnished are accurate and complete. I understand
that any willful misinformation and/or withholding of information will
automatically disqualify me from receiving any financial assistance
or subsidy, and may serve as ground for my expulsion from the
University. Furthermore, is such misinformation and/or withholding
of information on my part is discovered after I have been awarded
tuition scholarship or any form of financial assistance, I will be
required to reimburse all financial benefits plus the legal rate of
interest prevailing at the time of the reimbursement without
prejudice to the filing of charges against me. (Emphasis supplied
for emphasis)
Moreover, I understand that the University may send a fact-finding
team to visit my home/residence to verify the veracity of the
information provided in this application and I will give my utmost
cooperation in this regard. I also understand that my refusal to
cooperate with the fact-finding team may mean suspension of
withdrawal of STFAP benefits and privileges.
—
—
—
—
—
—
—
S
t
u
d
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 e one of the punishable acts under Section 2 (a) of the Rules and Regulations on
n Student Conduct and Discipline of the University the deliberate falsification or
t' suppression/withholding of any material information required in the application
s form.
S
i To further insure the integrity of the program, a random sampling scheme of
g verification of data indicated in a student's application form is undertaken. Among
n those who applied for STFAP benefits for School Year 1989-90 was Ramon P.
a Nadal, a student enrolled in the College of Law.
t
u
On March 14, 1991, a team composed of Arsenio L. Dona and Jose Carlo Manalo
r
conducted a home investigation at the residence of Nadal at 31 Twinpeaks Drive,
e
Blue Ridge, Quezon City.

Statement of the Applicant's Parent or Guardian

I hereby certify to the truthfulness and completeness of the
information which my son/daughter/dependent has furnished in
this application together with all the documents attached. I further
recognize that in signing this application form, I share with my
son/daughter/dependent the responsibility for the truthfulness and
completeness of the information supplied herein. (Emphasis
supplied for emphasis)
Moreover, I understand that the University may send a fact-finding
team to visit my home/residence to verify the information provided
in this application and I will give my utmost cooperation in this
regard. I also understand that my refusal to cooperate with the
fact-finding team may mean suspension or withdrawal of STFAP
benefits and privileges of my son/daughter/dependent.
———————
———————
———
Parent's/Legal
Guardian's/Spou
se's Signature1
From the early stages of its implementation, measures were adopted to safeguard
the integrity of the program. One such precautionary measure was the inclusion as
Ms. Cristeta Packing, Nadal's aunt, was interviewed and the team submitted a
home visit report. Consolacion Urbino, Scholarship Affairs Officer II, found
discrepancies between the report and Nadal's application form. Forthwith, she and
Bella M. Villanueva, head of the Office of Scholarships and Student Services,
presented the matter to the Diliman Committee on Scholarships and Financial
Assistance.2
In compliance with the said Committee's directive, Bella Villanueva wrote Nadal
informing him that the investigation showed that he had failed to declare, not only
the fact that he had been maintaining a 1977 Corolla car which was owned by his
brother but also the income of his mother who was supporting his brothers Antonio
and Federico. Nadal was likewise informed that the Diliman Committee had
reclassified him to Bracket 9 (from Bracket 4), retroactive to June 1989, unless he
could submit "proofs to the contrary." Nadal was required "to pay back the
equivalent amount of full school fees" with "interest based on current commercial
rates." Failure to settle his account would mean the suspension of his registration
privileges and the withholding of clearance and transcript of records. He was also
warned that his case might be referred to the Student Disciplinary Tribunal for
further investigation.3
On July 12, 1991, Nadal issued a certification stating, among other things, that his
mother migrated to the United States in 1981 but because her residency status
had not yet been legalized, she had not been able to find a "stable, regular, well-
paying employment." He also stated that his mother, jointly with his brother Virgilio,
was shouldering the expenses of the college education of his two younger
brothers.4
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Noting further discrepancies between Nadal's application form and the certification,
the U.P. charged Nadal before the Student Disciplinary Tribunal (SDT) on August
23, 1991 with the following:
That respondent RAMON P. NADAL (UP Student No. 83-11640),
a student of the College of Law, UP System, Diliman, Quezon
City, and STFAP (ISKOLAR NG BAYAN) recipient (Bracket 4 for
SY 1989-1990; Bracket 5 for SY 1990-1991) in his applications for
STFAP (ISKOLAR NG BAYAN) benefits which he filed for
schoolyear 1989-1990, and schoolyear 1990-1991, with the Office
of Scholarship and Student Services (formerly Scholarship and
Financial Assistance Service) voluntarily and willfully withheld and
did not declare the following:
(a) That he has and maintains a car (Toyota
Corolla, Model 1977); and
(b) The income of his mother (Natividad Packing
Nadal) in the U.S.A., in support of the studies of
his brothers Antonio and Federico,
which acts of willfully withholding information is tantamount to acts
of dishonesty in relation to his studies, in violation of paragraph
(a), Section 2, of the Rules and Regulations on Student Conduct
and Discipline, as amended. (Approved by the B.O.R. at its 876th
meeting on 02 September 1976, amended at the 923rd B.O.R.
meeting on 31 January 1980, and further amended at its 1017th
B.O.R. meeting on 08 December 1988).5
On October 27, 1992, after hearing, the SDT6 rendered a decision in SDT Case
No. 91-026 exculpating Nadal of the charge of deliberately withholding in his
STFAP application form information that he was maintaining a Toyota Corolla car,
but finding him guilty of "wilfully and deliberately withholding information about the
income of his mother, who is living abroad, in support of the studies of his brothers
Antonio and Federico, 7 which is tantamount to acts of dishonesty in relation to his
studies in violation of paragraph [a], Section 2 of the Rules [now covered by
paragraph (i), Section 2 of the Rules, as amended 25 June 1992]." As such, the
SDT imposed upon Nadal the penalty of expulsion from the University and
required him to reimburse all STFAP benefits he had received but if he does not
voluntarily make reimbursement, it shall be "effected by the University thru outside
legal action."8
The SDT decision was thereafter automatically elevated to the Executive
Committee of U.P. Diliman for review pursuant to Sec. 20 of the U.P. Rules on
Student Conduct and Discipline. On November 26, 1992, the Executive
Committee, voting 13:4, affirmed the decision of the SDT; whereupon, Nadal
appealed to the Board of Regents (BOR). The appeal was included in the agenda
of the BOR meeting on January 25, 1993.9
On January 18, 1993, upon her assumption to the Chairmanship of the Senate
Committee on Education, thereby making her automatically a member of the BOR,
Senator Leticia Ramos-Shahani wrote the BOR a letter expressing her view that,
after a close review of Nadal s case by her legal staff, "it is only fair and just to find
Mr. Nadal's appeal meritorious and his arguments worthy of belief. Consequently,
he should be allowed to graduate and take the bar examinations this year." 10
At its January 25, 1993 meeting, the BOR affirmed the decision of the SDT but
because "the Board was willing to grant a degree of compassion to the appellant in
view of the alleged status and predicament of the mother as an immigrant 'TNT' in
the United States," the penalty was modified "from Expulsion to One Year-
Suspension, effective immediately, plus reimbursement of all benefits received
from the STFAP, with legal interest." The BOR also decided against giving Nadal,
a certification of good moral character. 11
Nadal forthwith filed a motion for reconsideration of the BOR decision, allegedly
against the advice of his counsel. 12The motion was placed on the agenda of the
February 25, 1993 meeting of the BOR. A day before said date, Senator Shahani
wrote the BOR another letter requesting that deliberation on Nadal's case be
deferred until such time as she could attend a BOR meeting.
On March 15, 1993, the U.P. filed an opposition to Nadal's motion for
reconsideration. Thereafter, the BOR held a special meeting to accommodate the
request of Regent Shahani with Nadal's case as the sole item on its agenda.
Again, Nadal's motion for reconsideration was included in the March 23, 1993
agenda but in view of the absence of Senator Shahani, the decision thereon was
deferred.
At the special meeting of the BOR on March 28, 1993 at the Board Room of the
Manila Polo Club in Forbes Park, Makati, Regent Antonio T. Carpio raised the
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"material importance" of verifying the truth of Nadal's claim that earlier, he was a
beneficiary of a scholarship and financial aid from the Ateneo de Manila University
(AdeMU). Learning that the "certification issued by the AdeMU that it had not given
Nadal financial aid while he was a student there was made through a telephone
call," Regent Carpio declared that there was as yet "no direct evidence in the
records to substantiate the charge." According to Carpio, if it should be disclosed
that Nadal Falsely stated that he received such financial aid, it would be a clear
case of gross and material misrepresentation that would even warrant the penalty
of expulsion. Hence, he cast a conditional vote that would depend on the
verification of Nadal's claim on the matter.
U.P. President and concurrently Regent Jose V. Abueva countered by stating that
"a decision should not be anchored solely on one piece of information which he
considered irrelevant, and which would ignore the whole pattern of the
respondent's dishonesty and deception from 1989 which had been established in
the investigation and the reviews." He added that "the respondent's eligibility for
his AdeMU high school scholarship and financial assistance from 1979 to 1983
does not in any way establish that he is 'not guilty as charged' before the SDT,"
since the formal charges against him do not include withholding of information
regarding scholarship grants received from other schools.
At the said March 28, 1993 special meeting, the Board decided to go into
executive session where the following transpired:
The Chairman of the Board, together with the President, directed
the Secretary to reflect in the minutes of the meeting the following
decisions of the Board in executive session, with only the Board
members present.
A vote was held by secret ballot on whether Ramon P. Nadal was
guilty or not guilty as charged of willful withholding of information
in relation to his application for Socialized Tuition and Financial
Assistance Program (STFAP) benefits which he filed for
Schoolyears 1989-1990 and 1990-1991 which is tantamount to act
of dishonesty in relation to his studies, in violation of paragraph
(a), Section 2 of the Rules and Regulations on Student Conduct
and Discipline, as amended.
The Chairman gave the following results of the Board action
during the Executive Session: four (4) voted guilty; three (3) voted
not guilty; and three (3) gave conditional votes, pending
verification with Father Raymond Holscher of Ateneo de Manila
University of Ramon P. Nadal's statement in his STFAP
application that he was granted scholarship while he was in high
school. Should Ateneo confirm that Nadal had not received
financial assistance, then the conditional votes would be
considered as guilty, and if otherwise, then not guilty. The
Chairman requested the President to make the verification as
soon as possible the next day. In answer to a query, the Chairman
clarified that once the information was received from Ateneo, there
would be no need for another meeting to validate the decision.
The President reiterated his objections to the casting of conditional
votes.
The Chairman himself did not vote. 13
In the morning of March 29, 1993, the AdeMU issued a certification to the effect
that Nadal was indeed a recipient of a scholarship grant from 1979 to 1983. That
evening, the BOR met again at a special meeting at the Westin Philippine Plaza
Hotel. According to Regent Carpio, in executive session, the BOR found Nadal
"guilty" as the members voted as follows: six members — guilty, three members —
not guilty, and three members abstained. 14Consequently, the BOR imposed on
Nadal the penalties of suspension for one (1) year effective March 29, 1993, non-
issuance of any certificate of good moral character during the suspension and/or
as long as Nadal has not reimbursed the STFAP benefits he had received with
12% interest per annum from march 30, 1993 and non-issuance of his transcript of
records until he has settled his financial obligations with the university. 15
On March 30, 1993, Nadal wrote President Abueva a handwritten letter stating that
"after learning of the latest decision" of the BOR, he had been "intensely
concentrating on (his) job so that (he) can earn enough to pay for (his) financial
obligations to the University." Alleging that he was "now letting nature take its
course," Nadal begged President Abueva not to issue any press release regarding
the case. 16
However, on April 22, 1993, Nadal filed with the Regional Trial Court of Quezon
City a petition for mandamus with preliminary injunction and prayer for a temporary
restraining order against President Abueva, the BOR, Oscar M. Alfonso, Cesar A.
Buenaventura, Armand V. Fabella and Olivia C. Caoili. The petition prayed:
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 After trial on the merits, judgment be rendered as follows:
a. Making the preliminary injunction permanent;
b. Ordering respondents 'to uphold and implement their decision
rendered on 28 March 1993, exonerating petitioner from all the
charges against him, and accordingly dismissing SDT No. 91-026;
c. Ordering respondents jointly and severally to pay petitioner
litigation expenses of at least P150,000.00.
Other just and equitable reliefs are likewise prayed for. 17
The motion for the issuance of a temporary restraining order and the writ of
preliminary injunction was immediately set for hearing. At the May 10, 1993
hearing, the lower court declared that the only issue to be resolved was "whether
or not the respondents in Civil Case No. 93-15665 violated (Nadal's) right to due
process when it rendered a decision finding Nadal guilty of the charges against
him" during the March 29, 1993 meeting. After the respondents had presented
their first witness, Dr. Olivia C. Caoili, the lower court asked respondents' counsel
whether they were amenable to maintaining the status quo. Said counsel replied in
the negative, asserting the University's prerogative to discipline students found
guilty of violating its rules of discipline.18
On the same day, the lower court 19 issued the following Order:
The parties were heard on their respective positions on the
incident (application for preliminary injunction and prayer for
temporary restraining order and opposition thereto). For lack of
material time set this for continuation on May 17 and 18, 1993
both at 2:30 p.m.
In the meantime, in order that the proceedings of this case may
not be rendered moot and academic, the respondents herein,
namely: Jose V. Abueva, President of the University of the
Philippines and Vice-Chairman of the U.P. Board of Regents,
Oscar M. Alfonso, Cesar A. Buenaventura and Armand V. Fabella,
members of the U.P. Board of Regents, Olivia C. Caoili, the
officers, agents, representatives, and all persons acting in their
behalf, are hereby temporarily restrained from implementing their
decision rendered on March 29, 1993 in Administrative SDT Case
No. 91-026 entitled University of the Philippines vs. Ramon P.
Nadal, as reflected in the Minutes of the 1062nd meeting of the
Board of Regents, U.P. held at the Romblon Room, Westin Phil.
Plaza, Manila, until further order from this Court.
SO ORDERED.
Thereafter, Nadal presented as witnesses Regents Emerenciana Y. Arcellana,
Ariel P. Tanangonan, Leticia R. Shahani and Antonio T. Carpio. The University, on
the other hand, presented Dr. Olivia Caoili and Nadal himself as a hostile witness.
On May 29, 1993, the lower court issued the following Order:
The petitioner complains that he was not afforded due process
when, after the Board Meeting on SDT Case No. 91-026 on March
28, 1993 that resulted in a decision of "NOT GUILTY" in his favor,
the Chairman of the U.P. Board of Regents, without notice to the
herein petitioner, called another meeting the following day to
deliberate on his (the Chairman's) MOTION FOR
RECONSIDERATION, which this time resulted in a decision of
"GUILTY." While he main issue of violation of due process raised
in the petition pends trial and resolution, the petitioner prays for
the issuance of a writ of preliminary injunction prohibiting the
respondents from further proceeding with SDT Case No. 21-026
and from suspending the petitioner for one year.
It is a basic requirement in the issuance of the preliminary
injunctive writ that there must be a right to be protected. As the
issue in the case at bar is due process in the March 29 Board
meeting, there is, indeed, a right to be protected for, in
administrative proceedings, a respondent's right to due process
exists not only at the early stages but also at the final stage
thereof.
With the circulation to the members of the Board of Regents, as
well as to other UP personnel, of the Minutes of the March 29,
1993 meeting, even after this case had already been filed, the
Court is convinced that there now exists a threat to the petitioner
(respondent in SDT Case No, 91-026) that the decision of the
Board of Regents finally finding him guilty of willfully withholding
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 information material to his application for Socialized Tuition and
Financial Assistance Program (STFAP) benefits, will be
implemented at any time, especially during the enrollment period,
and this implementation would work injustice to the petitioner as it
would delay him in finishing his course, and, consequently, in
getting a decent and good paying job. The injury thus caused
would be irreparable.
"Damages are irreparable within the meaning of
the rule where there is no standard by which their
amount can be measured with reasonable
accuracy. Where the damage is susceptible of
mathematical computation, it is not irreparable."
(Social Security Commission v. Bayona, et al.,
G.R. No. L-13555, May 30, 1962).
IN VIEW OF THE FOREGOING, and so as not to render moot the
issues in the instant proceedings, let a writ of preliminary
injunction be issued restraining the respondents, their officers,
agent(s), representatives, and all persons acting in their behalf,
from further proceeding with SDT Case No. 91-026, and from
suspending petitioner, upon the latter's filing a bond in the amount
of P3,000.00.
IT IS SO ORDERED. 20
Dispensing with the filing of a motion for reconsideration, the petitioners filed the
instant petition for certiorari and prohibition with prayer for the issuance of an
injunction or temporary restraining order, raising the following issues: whether or
not Nadal was denied due process in the administrative disciplinary proceedings
against him, and, whether or not the respondent judge gravely abused her
discretion in issuing the May 29, 1993 writ of preliminary injunction thereby
preventing the BOR from implementing the suspension penalty it had imposed on
Nadal.
Before proceeding with the discussion of the merits of the instant petition, we shall
confront a threshold issue raised by private respondent, namely, that Dr. Caoili, not
having been authorized by the Board of Regents as a collegial body to file the
instant petition, and Dr. Abueva, who verified the petition, not being the "Board of
Regents" nor "the University of the Philippines," they are not real parties in interest
who should file the same. 21
A real party in interest is one "who stands to be benefited or injured by the
judgment or the party entitled to the avails of the suit. 'Interest' within the meaning
of the rule means material interest, an interest in issue and to be affected by the
decree, as distinguished from mere interest in the question involved, or a mere
incidental interest."22Undoubtedly, the U.P. Board of Regents has an interest to
protect inasmuch as what is in issue here is its power to impose disciplinary action
against a student who violated the Rules and Regulations on Student Conduct and
Discipline by withholding information in connection with his application for STFAP
benefits, which information, if disclosed, would have sufficed to disqualify him from
receiving the financial assistance he sought. Such dishonesty, if left unpunished,
would have the effect of subverting a commendable program into which the
University officials had devoted much time and expended precious resources, from
the conceptualization to the implementation stage, to rationalize the socialized
scheme of tuition fee payments in order that more students may benefit from the
public funds allocated to the State University.
Having specifically named Drs. Abueva and Caoili as respondents in the petition
for mandamus that he filed below, Nadal is now estopped from questioning their
personality to file the instant petition.23 Moreover, under Sec. 7 of the U.P. Charter
(Act 1870) and Sec. 11 of the University Code "all process" against the BOR shall
be served on "the president or secretary thereof'." It is in accordance with these
legal provisions that Dr. Caoili is named as a petitioner. Necessarily, Dr. Abueva,
the University President and member of the BOR, has to verify the petition. It is not
mandatory, however, that each and every member of the BOR be named
petitioners. As the Court has time and again held, an action may be entertained,
notwithstanding the failure to include an indispensable party where it appears that
the naming of the party would be but a formality. 24
No longer novel, as this is not a case of first impression, is the issue on the right of
an academic institution to refuse admission to a student arising from the imposition
upon him of an administrative disciplinary sanction. In our recent decision
in Ateneo de Manila University v. Hon. Ignacio M. Capulong,25 wherein certain law
students were dismissed for hazing resulting in the death of another, we held that
the matter of admission of students is within the ambit of academic freedom and
therefore, beyond the province of the courts to decide. Certain fundamental
principles bear stressing.
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One of the arguments of Nadal in his petition for mandamus below was that he
was denied due process. To clarify, the so-called lack of due process referred only
to the March 29, 1993 meeting of the BOR. As stated by respondent's counsel:
"What was conceded by undersigned counsel was that Nadal was afforded due
process from the start of the administrative proceeding up to the meeting of the
Board of Regents on March 28, 1993."26
With respect to the March 29, 1993 meeting, respondent considers the same as
"unquestionably void for lack of due process" inasmuch as he was not sent a
notice of said meeting. Counsel cites the ruling in Non v. Dames II 27 that
imposition of sanctions on students requires "observance of procedural due
process," 28 the phrase obviously referring to the sending of notice of the meeting.
Attention is drawn to the disparate factual environments obtaining in Non v. Dames
II and in the instant case. In the former case, the students were refused admission
for having led or participated in student mass actions against the school, thereby
posing a collision between constitutionally cherished rights — freedom of
expression and academic freedom. In the case at bar, Nadal was suspended for
having breached the University's disciplinary rules. In the Non case, the Court
ruled that the students were not afforded due process for even the refusal to re-
enroll them appeared to have been a mere afterthought on part of the school
administrators. Here, Nadal does not dispute the fact that his right to due process
was held inviolate until the BOR decided to meet on March 29, 1993 with his case
as the sole item on the agenda.
In any event it is gross error to equate due process in the instant case with the
sending of notice of the March 29, 1993 BOR meeting to respondent. University
rules do not require the attendance in BOR meetings of individuals whose cases
are included as items on the agenda of the Board. This is not exclusive of students
whose disciplinary cases have been appealed to the Board of Regents as the final
review body. At no time did respondent complain of lack of notice given to him to
attend any of the regular and special BOR meetings where his case was up for
deliberation. He would make an exception of the March 29, 1993 meeting for it was
"supposed to reconsider the decision made on March 28, 1993 exonerating
respondent Nadal from all administrative charges against him." 29
Regent Antonio T. Carpio, in his testimony before the lower court on May 25, 1993
admitted that there was no final verdict at the March 28, 1993 meeting in view of
the conditional votes resulting from his assertion that he was "not morally
convinced that there was sufficient evidence to make a finding of guilty against
Nadal because there was no direct evidence that his mother received income from
the United States and this income was sent to the Philippines to support the
studies of the children." 30 Two regents shared the view of Regent Carpio, with the
following result: four voted guilty, three, not guilty, and three cast conditional votes.
The BOR agreed that, upon the suggestion of Regent Carpio, they would still verify
from the AdeMU about Nadal's alleged scholarship as a student in said institution.
Consequently, no definitive decision was arrived at by the BOR on March 28,
1993, Much less was a verdict of exoneration handed down as averred by
respondent.
Regent Carpio testified, with respect to the March 29, 1993 meeting where all
twelve members of the BOR were present, that all of them participated in the
voting held to reconsider the previous day's decision. He stated "I remember
Regent Arcellana questioning the voting again on the ground that there was
already a final decision, but there was a vote taken on whether a motion for
reconsideration can be decided by the board, and a majority of the board ruled that
the matter can be reconsidered again upon motion of the chairman." 31
At said meeting, six (6) regents voted to find respondent guilty, three (3) voted that
he was not guilty and three (3) abstained. As succinctly announced by Regent
Carpio, the final decision was that which was rendered on March 29, 1993 as "no
other decision was made by the Board with respect to the same issue." 32
Counsel for Nadal charged before the lower court that his client was "not given due
process in the March 29 meeting because the ground upon which he was again
convicted was not the same as the original charge."33Obviously, he was referring
to the basis of the conditional votes on March 28, i.e., whether or not Nadal was
telling the truth when he claimed that he received a scholarship grant from the
AdeMU. However, Regent Carpio himself testified that the charge considered was
"exactly the same charge" of withholding information on the income of Nadal's
mother. 34 It should be stressed that the reason why Regent Carpio requested a
verification of Nadal's claim that he was a scholar at the AdeMU was that Regent
Carpio was not "morally convinced" yet as to the guilt of Nadal. In other words, he
sought additional insights into the character of Nadal through the information that
would be obtained from the AdeMU.
In this regard, we find such information to be irrelevant and a mere superfluity. In
his July, 12, 1991 certification aforementioned, Nadal admitted, although
inconsistently, that his mother was a "TNT" who could not find a "stable, regular,
well-paying employment" but that she was supporting the education of his brothers
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with the help of another son. To our mind, this constitutes sufficient admission that
Nadal withheld information on the income, however measly and irregular, of his
mother. Unlike in criminal cases which require proof beyond reasonable doubt as
basis for a judgment, in administrative or quasi-judicial proceedings,
only substantial evidence is required, that which means more than a mere scintilla
or relevant evidence as a reasonable mind might accept as adequate to support a
conclusion, even if other minds equally reasonable might conceivably opine
otherwise. 35 In light of the foregoing circumstances, we find that Nadal has been
sufficiently proven to have violated his undertaking to divulge all information
needed when he applied for the benefits of the STFAP.
Let it not be forgotten that respondent aspires to join the ranks of the professionals
who would uphold truth at all costs so that justice may prevail. The sentinels who
stand guard at the portals leading to the hallowed Temples of Justice cannot be
overzealous in admitting only those who are intellectually and morally fit. In those
who exhibit duplicity in their student days, one spots the shady character who is
bound to sow the seeds of chicanery in the practice of his profession.
Having reached his senior year, respondent is presumably aware that the bedrock
axiom, Canon I, Rule 1.01 of the Code of Professional Responsibility states: "A
lawyer shall not engage in unlawful, dishonest, immoral or deceitful conduct."
Further on, Canon 7, Rule 7.01 provides: "A lawyer shall be answerable for
knowingly making a false statement or suppressing a material fact in connection
with his application for admission to the bar." (Emphasis supplied for emphasis)
Surely, it is not too early to warn entrants to the noble profession of law that
honesty and integrity are requirements no less weighty than hurdling the Bar
examinations. This is the reason why a certification of good moral character is one
of the documents that must be submitted in applying to take said examination. In
fact, a charge of immoral or deceitful conduct on the part of an applicant, when
proved, is a ground for disqualifying him.
To revert to the instant case, inasmuch as it has been shown sufficiently that
respondent has committed an act of dishonesty in withholding vital information in
connection with his application for STFAP benefits, all in blatant violation of the
Rules and Regulations on Student Conduct and Discipline of petitioner University,
the latter's inherent power and authority to impose disciplinary sanction may be
invoked and rightfully exercised.
As a Bohemian proverb puts it: "A school without discipline is like a mill without
water." Insofar as the water turns the mill, so does the school's disciplinary power
assure its right to survive and continue operating. In more relevant terms, through
its power to impose disciplinary sanctions, an educational institution is able to
exercise its academic freedom which is, in the case at bar, the right to suspend
and refuse admission to a student who has subverted its authority in the
implementation of the critically important STFAP.
At the risk of being repetitious, the matter of admission to a University is
encompassed by the right of academic freedom. In Garcia v. The Faculty
Admission Committee, Loyola School of Theology 36 the Court stated that a school
or college which is possessed of the right of academic freedom "decides for itself
its aims and objectives and how best to attain them. It is free from outside coercion
or interference save possibly when the overriding public welfare calls for some
restraint. It has a wide sphere of autonomy certainly extending to the choice of
students." Elucidating, in Ateneo de Manila University v. Hon. Ignacio
M. Capulong, 37 the Court further expounded:
Since Garcia v. Loyola School of Theology, we have consistently
upheld the salutary proposition that admission to an institution of
higher learning is discretionary upon a school, the same being a
privilege on the part of the student rather than a right. While under
the Education Act of 1982, students have a right "to freely choose
their field of study, subject to existing curricula and to continue
their course therein up to graduation," such right is subject, as all
rights are, to the established academic and disciplinary standards
laid down by the academic institution.
For private schools have the right to establish reasonable rules
and regulations for the admission, discipline and promotion of
students. This right . . . extends as well to parents . . . as parents
are under a social and moral (if not legal) obligation, individually
and collectively, to assist and cooperate with the schools.
Such rules are "incident to the very object of incorporation and
indispensable to the successful management of the college. The
rules may include those governing student discipline." Going a
step further, the establishment of rules governing university-
student relations, particularly those pertaining to student discipline,
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 may be regarded as vital, if not merely to the smooth and efficient
operation of the institution, but to its very survival.
Within memory of the current generation is the eruption of
militancy in the academic groves as collectively, the students
demanded and plucked for themselves from the panoply of
academic freedom their own rights encapsulized under the rubric
of "right to education" forgetting that, in Hohfeldian terms, they
have a concomitant duty, that is, their duty to learn under the rules
laid down by the school. (Emphasis supplied.)
On the second issue presented for adjudication, the Court finds that the lower
court gravely abused its discretion in issuing the writ of preliminary injunction of
May 29, 1993. The issuance of the said writ was based on the lower court's finding
that the implementation of the disciplinary sanction of suspension on Nadal "would
work injustice to the petitioner as it would delay him in finishing his course, and
consequently, in getting a decent and good paying job." Sadly, such a ruling
considers only the situation of Nadal without taking into account the circumstances
clearly of his own making, which led him into such a predicament. More
importantly, it has completely disregarded the overriding issue of academic
freedom which provides more than ample justification for the imposition of a
disciplinary sanction upon an erring student of an institution of higher learning.
From the foregoing arguments, it is clear that the lower court should have
restrained itself from assuming jurisdiction over the petition filed by
Nadal. Mandamus is never issued in doubtful cases, a showing of a clear and
certain right on the part of the petitioner being required. 38 It is of no avail against
an official or government agency whose duty requires the exercise of discretion or
judgment. 39
Hence, by issuing the writ of preliminary injunction, the lower court dared to tread
upon legally forbidden grounds. For, by virtue of the writ, the University's exercise
of academic freedom was peremptorily curtailed. Moreover, the door was flung
wide open for Nadal to do exactly what the decision of the BOR prohibited him
from doing and that is, to violate the suspension order by enrolling for the first
semester of 1993-1994. It must have been with consternation that the University
officials helplessly watching him complete his academic requirements for taking
the Bar. 40 In the event that he be allowed to continue with his studies he would, in
effect render moot and academic the disciplinary sanction of suspension legally
imposed upon him by the BOR's final decision of March 29, 1993. What is to
prevent other aspirants for STFAP scholarships from misleading the University
authorities by misrepresenting certain facts or as in instant case, withholding vital
information and stating downright falsehoods, in their application forms with
impunity? Not only would this undermine the authority of the U.P. to discipline its
students who violated the rules and regulations of the institution but, more
importantly, subvert the very concept and lofty intent to give financial assistance to
poor but deserving students through the STFAP which, incidentally, has not
ceased refining and modifying it's operations.
WHEREFORE, the instant petition is GRANTED and the lower court is hereby
ordered to DISMISS the petition for mandamus.
SO ORDERED.
G.R. No. 70484 January 29, 1988
ROMAN C. TUASON and REMEDIOS V. TUASON, by attorney-in-fact Trinidad
S. Viado, petitioners,
vs.
REGISTER OF DEEDS, CALOOCAN City, MINISTRY OF JUSTICE, and the
NATIONAL TREASURER, respondents. TOMASA BARTOLOME, in her own
behalf and in behalf of the other members of the "Consuelo Heights
Homeowners Association," petitioners-intervenors.
Orlando A. Rayos for petitioners-intervenors.
The Solicitor General for respondents.
NARVASA, J.:
A more despotic, capricious, oppressive and unjustifiable exercise of government
power than that manifested in this case can scarcely be found in the sordid annals
of the martial law regime. Relief to the victims must be as it is hereby extended by
the grant to them of the extraordinary writ of certiorari and prohibition condemning
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as unconstitutional, and annulling and perpetually enjoining the acts complained
of.
Petitioner spouses, the Tuasons, were retired public school teachers. On April 6,
1965, with funds pooled from their retirement benefits and savings, they bought
from Carmel Farms, Inc. (hereafter simply, Carmel) a piece of land measuring
about 8,756 square meters, in the latter's subdivision in Barrio Makatipo, Caloocan
City. In virtue of this sale, Carmel's Torrens title (No. 64007) over the lot was
cancelled and a new one (No. 8314) issued in the name of the Tuasons. The
Tuasons took possession of their property.
Some eight (8) years thereafter, the Tuasons' travails began. They woke up one
morning to discover that by presidential flat, they were no longer the owners of the
land they had purchased with their hard-earned money, and that their land and the
other lots in the subdivision had been "declared open for disposition and sale to
the members of the Malacanang Homeowners Association, Inc., the present bona
fide occupants thereof."
On September 14, 1973-a year almost to the day after the declaration of martial
law Mr. Ferdinand Marcos, then president of the country, invoking his emergency
powers, issued Presidential Decree No. 293 with immediate effect. The decree
invalidated inter alia the title of the Tuasons' vendor, Carmel, which had earlier
purchased from the Government the land it had subsequently subdivided into
several lots for sale to the public (the Tuasons being among the buyers). The land
bought by Carmel was part of the Tala Estate (one of the so-called "Friar Lands").
Carmel had bought the land under Act No. 1120 and C.A. No. 32, as amended.
Under these statutes:
1) a bona fide settler or occupant was allowed to purchase (if he did not wish to
lease) the portion occupied by him at the price fixed by the Government, in cash or
on installment; the interested buyer was given a certificate of sale, which was
regarded as an agreement by him to pay the purchase price in the and at the
interest specified, the acceptance of such certificate making the occupant a debtor
of the government;
2) until the price was fully paid however, title was reserved in the Government, and
any sale or encumbrance made by the purchaser prior to such full payment was
explicitly declared to 'be invalid as against the Government ... and ... in all respects
subordinate to its prior claim;"
3) in the event of default by a purchaser to pay any installment of purchase money
and interest thereon, the Chief of the Bureau of Public Lands (now Director of
Lands) had the duty at once to protect the Government from loss by bringing suit
to obtain judicial authority to enforce the Government's lien on the "and by selling it
in the same manner as for foreclosure of mortgages, the purchaser at such sale
being deemed to acquire a good and indefeasible title, and the proceeds of the
sale being applied to the payment of the costs of the court and all installments due
or to become due; and
4) in the event of completion of payment, the Government transferred title to the
land to the purchaser "by proper instrument of conveyance," the certificate of title
over the land to issue and become effective in the manner provided by the Land
Registration Act. 1
Said Presidential Decree No. 293 made the finding 2 that Carmel had failed to
complete payment of the price. It adjudged that —
... according to the records of the Bureau of Lands, neither the
original purchasers nor their subsequent transferees have made
full payment of all installments of the purchase money and interest
on the lots claimed by the Carmel Farms, Inc., including those on
which the dwellings of the members of said Association 3 stand.
Hence, title to said land has remained with the Government, and
the land now occupied by the members of said association has
never ceased to form part of the property of the Republic of the
Philippines, any and all acts affecting said land and purporting to
segregate it from the said property of the Republic of the
Philippines being therefore null and void ab initio as against the
law and public policy.
Upon this adjudgment, Mr. Marcos invalidated the titles of Carmel Farms, Inc. and
all those derived therefrom, and declared as aforestated "the members of the
Malacanang Homeowners Association, Inc. the present bona fide occupants" of
the lots which, in consequence, thereby became open to them for "disposition and
sale ... pursuant to Commonwealth Act No. 32, as amended." 4
It seems to have completely escaped Mr. Marcos' attention that his decree
contained contradictory declarations. While acknowledging on the one hand that
the lots in the Carmel Subdivision were occupied by the buyers thereof, and in fact
the latter's dwellings stood thereon, he states on the other that the "members of
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the Malacanang Homeowners Association, Inc. (are) the present bona fide
occupants" of all said lots. The latter averment is not only essentially inconsistent
with the former but is both a physical and legal fallacy. Well known is the rule of
physics that two objects cannot occupy the same space at the same time. And the
absurdity of the subsumed proposition is self-evident for persons not in possession
of land, who probably have not even set foot thereon, cannot be deemed
"occupants" thereof, much less "bona fide" occupants.
But this notwithstanding, and upon the factual premise already indicated, Mr.
Marcos disposed of the land of the petitioner spouses and others similarly situated
as they, in the following imperious manner:
NOW, THEREFORE, I, FERDINAND E. MARCOS, President of
the Philippines, by virtue of the powers vested in me by the
Constitution as Commander-in-Chief of all the Armed Forces of
the Philippines, and pursuant to Proclamation 1081, dated
September 21, 1972, and General Order No. 1, dated September
22, 1972, do hereby order and decree that any and all sales
contracts between the government and the original purchasers,
are hereby cancelled, and those between the latter and the
subsequent transferees, and any and all transfers thereafter,
covering lots 979, 981, 982, 985, 988, 989, 990, 991 new, 1226,
1228, 1230, and 980-C-2 (LRC PSD-1730), all of Tala Estate,
Caloocan City, are hereby declared invalid and null and void ab
initio as against the Government; that Transfer Certificates of Title
Nos. 62603, 62604, 62605, covering lots 1, 2 and 3, PCS-4383, all
in the name of Carmel Farms, Inc., which are a consolidation and
subdivision survey of the lots hereinbefore enumerated, are
declared invalid and considered cancelled as against the
Government; and that said lots are declared open for disposition
and sale to the members of the Malacanang Homeowners
Association, Inc., the present bona fide occupants thereof,
pursuant to Commonwealth Act No. 32, as amended.
On the strength of this presidential decree, the Register of Deeds of Caloocan City
caused the inscription on the Tuasons' title, TCT No. 8314, of the following:
MEMORANDUM. — Pursuant to Presidential Decree No. 293, this
certificate of title is declared invalid and null and void ab initio and
considered cancelled as against the Government and the property
described herein is declared open for disposition and sale to the
members of the Malacanang Homeowners Association, Inc.
The Tuason Spouses thereupon filed with this Court a petition
for certiorari assailing the Marcos decree as an arbitrary measure which deprived
them of their property in favor of a selected group, in violation not only of the
constitutional provisions on due process and eminent domain 5 but also of the
provisions of the Land Registration Act on the indefeasibility of Torrens titles; 6 and
they prayed that the Register of Deeds be directed to cancel the derogatory
inscription on their title and restore its efficacy, or in the alternative, that they be
compensated for the loss from the Assurance Fund.
Mr. Marcos' Solicitor General sought to sustain the decree. In his comment on the
petition, 7 he questioned the propriety of the remedy of certiorari resorted to by the
petitioners, it not appearing that the public respondents were being sued as judicial
or quasi-judicial officers who had acted without or in excess of their jurisdiction, or
with grave abuse of discretion. He opined that the petitioner spouses had no cause
to complain of unjust deprivation of property because in legal contemplation 8 they
had never become owners thereof because of non-payment of the purchase price
by their predecessor-in-interest; and the decree was justifiable under the social
justice clause of the Constitution and the police power, being in response to the
pressing housing need of the employees of the Office of the President who were
left homeless and landless after they were asked to vacate Malacanang Park
where they had theretofore been residing. He expressed the view, too, that
petitioner spouses were not entitled to recover anything from the Assurance Fund.
Petitions for intervention have of late been filed by sixty-four (64) persons,
members of the "Consuelo Heights Homeowners Association" headed by Tomasa
Bartolome, on the claim that they, too, had been divested of their lands by the
same Presidential Decree No. 293, adopting as their own the allegations and
prayer embodied in the Tuasons' petition.
The procedural issue is quite easily disposed of. It is true that the extraodinary writ
of certiorari 9 may properly issue to nullify only judicial or quasi-judicial acts, unlike
the writ of prohibition which may be directed against acts either judicial or
ministerial. Section 1, Rule 65 of the Rules of Court deals with the writ
of certiorari in relation to "any tribunal, board or officer exercising judicial functions,
while Section 2 of the same Rule treats of the writ of prohibition in relation to
"proceedings of any tribunal, corporation, board, or person ... exercising functions
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judicial or ministerial." But the petition will be shown upon analysis to be in reality
directed against an unlawful exercise of judicial power.
The decree reveals that Mr. Marcos exercised an obviously judicial function. He
made a determination of facts, and applied the law to those facts, declaring what
the legal rights of the parties were in the premises. These acts essentially
constitute a judicial function, 10 or an exercise of jurisdiction — which is the power
and authority to hear or try and decide or determine a cause. 11 He adjudged it to
be an established fact that neither the original purchasers nor their subsequent
transferees have made full payment of all installments of the purchase money and
interest on the lots claimed by Carmel Farms, Inc., including those on which the
dwellings of the members of ... (the) Association (of homeowners) stand." And
applying the law to that situation, he made the adjudication that "title to said land
has remained with the Government, and the land now occupied by the members of
said association has never ceased to form part of the property of the Republic of
the Philippines," and that 'any and all acts affecting said land and purporting to
segregate it from the said property of the Republic ... (were) null and void ab initio
as against the law and public policy.
These acts may thus be properly struck down by the writ of certiorari, because
done by an officer in the performance of what in essence is a judicial function, if it
be shown that the acts were done without or in excess of jurisdiction, or with grave
abuse of discretion. Since Mr. Marcos was never vested with judicial power, such
power, as everyone knows, being vested in the Supreme Court and such inferior
courts as may be established by law 12 — the judicial acts done by him were in the
circumstances indisputably perpetrated without jurisdiction. The acts were
completely alien to his office as chief executive, and utterly beyond the permissible
scope of the legislative power that he had assumed as head of the martial law
regime.
Moreover, he had assumed to exercise power — i.e. determined the relevant facts
and applied the law thereto without a trial at which all interested parties were
accorded the opportunity to adduce evidence to furnish the basis for a
determination of the facts material to the controversy. He made the finding
ostensibly on the basis of "the records of the Bureau of Lands." Prescinding from
the fact that there is no indication whatever the nature and reliability of these
records and that they are in no sense conclusive, it is undeniable that the petitioner
Tuasons (and the petitioners in intervention) were never confronted with those
records and afforded a chance to dispute their trustworthiness and present
countervailing evidence. This is yet another fatal defect. The adjudication was
patently and grossly violative of the right to due process to which the petitioners
are entitled in virtue of the Constitution. Mr. Marcos, in other words, not only
arrogated unto himself a power never granted to him by the Constitution or the
laws but had in addition exercised it unconstitutionally.
In any event, this Court has it in its power to treat the petition for certiorari as one
for prohibition if the averments of the former sufficiently made out a case for the
latter. 13 Considered in this wise, it will also appear that an executive officer had
acted without jurisdiction — exercised judicial power not granted to him by the
Constitution or the laws — and had furthermore performed the act in violation of
the constitutional rights of the parties thereby affected. The Court will grant such
relief as may be proper and efficacious in the premises even if not specifically
sought or set out in the prayer of the appropriate pleading, the permissible relief
being determined after all not by the prayer but by the basic averments of the
parties' pleadings. 14
There is no dispute about the fact that title to the land purchased by Carmel was
actually issued to it by the Government. This of course gives rise to the strong
presumption that official duty has been regularly performed, 15that official duty
being in this case the ascertainment by the Chief of the Bureau of Public Lands of
the fulfillment of the condition prescribed by law for such issuance, i.e., the
payment in full of the price, together with all accrued interest. Against this
presumption there is no evidence. It must hence be accorded full sway in these
proceedings. Furthermore, the title having been duly issued to Carmel, it became
"effective in the manner provided in section one hundred and twenty-two of the
Land Registration Act." 16
It may well be the fact that Carmel really did fail to make full payment of the price
of the land purchased by it from the Government pursuant to the provisions of Act
1120. This is a possibility that cannot be totally discounted. If this be the fact, the
Government may bring suit to recover the unpaid installments and interest,
invalidate any sale or encumbrance involving the land subject of the sale, and
enforce the lien of the Government against the land by selling the same in the
manner provided by Act Numbered One Hundred and Ninety for the foreclosure of
mortgages. 17 This it can do despite the lapse of a considerable period of time.
Prescription does not lie against the Government. But until and unless such a suit
is brought and results in a judgment favorable to the Government, the acquisition
of title by Carmel and the purchases by the petitioners and the petitioners-
intervenors from it of portions of the land covered by its original title must be
respected. At any rate, the eventuation of that contingency will not and cannot in
any manner affect this Court's conclusion, herein affirmed, of the
unconstitutionality and invalidity of Presidential Decree No. 293, and the absolute
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lack of any right to the land or any portion thereof on the part of the members of
the so-called "Malacanang Homeowners Association, Inc." The decree was not as
claimed a licit instance of the application of social justice principles or the exercise
of police power. It was in truth a disguised, vile stratagem deliberately resorted to
favor a few individuals, in callous and disdainful disregard of the rights of others. It
was in reality a taking of private property without due process and without
compensation whatever, from persons relying on the indefeasibility of their titles in
accordance with and as explicitly guaranteed by law.
One last word, respecting the petitioners in intervention, Their petition to intervene
substantially fulfilled the requirements laid down for a class suit 18 and was
consequently given due course by the Court. They are therefore covered by this
judgment.
WHEREFORE, Presidential Decree No. 293 is declared to be unconstitutional and
void ab initio in all its parts. The public respondents are commanded to cancel the
inscription on the titles of the petitioners and the petitioners in intervention of the
memorandum declaring their titles null and void and declaring the property therein
respectively described open for disposition and sale to the members of the
Malacanang Homeowners Association, Inc. to do whatever else is needful to
restore the titles to full effect and efficacy; and henceforth to refrain, cease and
desist from implementing any provision or part of said Presidential Decree No.
293. No pronouncement as to costs.
Yap, Fernan, Melencio-Herrera, Gutierrez, Jr., Cruz, Paras, Gancayco, Padilla,
Bidin, Sarmiento and Cortes JJ., concur.
Separate Opinions
TEEHANKEE, C.J., concurring:
I concur fully in the main opinion forcefully written by Mr. Justice Narvasa and the
separate opinion of Mr. Justice Feliciano depicting the unparalleled "despotic,
capricious, oppressive and unjustifiable exercise of government power" by the
deposed President Ferdinand E. Marcos, as struck down by the Court's
unanimous judgment in the case at bar. To be sure, this is but one of the many
unconstitutional and void Presidential Decrees of the past unlamented regime
which perforce have been so annulled and relief granted to the victims, as they are
brought to the Court's attention.
These arbitrary, capricious and oppressive decrees, tailored to suit the deposed
President's every wish and whim, were the product of unrestrained power, as the
deposed President took over the entire government with the imposition of martial
law in September, 1972. Such unrestrained exercise of power was heightened by
the Court's majority pronouncement in April, 1983 (even as martial law had been
lifted at least on paper two years earlier by Proclamation No. 2045 in January,
1981) that in times of grave emergencies, "The President takes absolute
command, for the very life of the nation and its government, which, incidentally,
includes the courts, is in grave peril. In so doing, the President is answerable only
to his conscience, the people and to God. For their part, in giving him the supreme
mandate as their President, the people can only trust and pray that, giving him
their own loyalty with utmost patriotism, the President will not fail them." 1
It certainly cannot be gainsaid that such judicial abdication turned back the clock
to lese majeste and dismantled the intricate system of reenforcing rules, principles
and procedures that have evolved through centuries of struggle for the more
efficacious protection through independent courts of the individual's right to life,
liberty and property and due process of law, so that they would no longer have to
depend upon prayers for the purpose.
This concurrence is to express the fervent prayer that we have learned well our
lesson that absolute power corrupts absolutely and that as Thomas Jefferson
warned (which sadly proved to be true in our case), "a single consolidated
government would become the most corrupt government on earth."
We have won back our freedoms and restored democracy with three great
departments of government, and separation of powers and checks and balances.
As Rizal taught us, freedom must be nurtured and cherished, not abused, else we
lose or forfeit it. We must reconsecrate ourselves to the supremacy of the Rule of
Law and renew once more our faith in and adherence to the force of law, rather
than the law of force-for only in the Rule of Law may a democracy survive and
Page 118 of 507
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flourish. This means selfless adherence by all to the basics, for as Brandeis aptly
expressed it, "Democracy is a serious undertaking. It is more difficult to maintain
than to achieve. It demands continuous sacrifice by the individual and more
exigent obedience to the moral law than any other form of government."
FELICIANO, J., concurring:
I quite agree with the constitutional law analysis of my learned brother in the Court,
Mr. Justice Narvasa, in his eloquent opinion. I should like simply to add that
Presidential Decree No. 293 is constitutionally offensive for still another reason: it
constitutes a bill of attainder, prohibited not only under the 1935 and 1987
Constitutions but also under the 1973 Constitution.
Bills of attainder are an ancient instrument of tyranny. In England a few centuries
back, Parliament would at times enact bills or statutes which declared certain
persons attainted and their blood corrupted so that it lost all heritable quality (Ex
Parte Garland, 4 Wall. 333, 18 L.Ed. 366 [1867]). In more modem terms, a bill of
attainder is essentially a usurpation of judicial power by a legislative body. It
envisages and effects the imposition of a penalty — the deprivation of life or liberty
or property — not by the ordinary processes of judicial trial, but by legislative fiat.
While cast in the form of special legislation, a bill of attainder (or bill of pains and
penalties, if it prescribed a penalty other than death) is in intent and effect a penal
judgment visited upon an Identified person or group of persons (and not upon the
general community) Without a prior charge or demand, without notice and healing,
without an opportunity to defend, without any of the civilized forms and safeguards
of the judicial process as we know it (People v. Ferrer, 48 SCRA 382 [1972];
Cummings and Missouri, 4 Wall. 277, 18 L.Ed. 356 [1867]; U.S. v. Lovett, 328,
U.S. 303, 90 L.Ed. 1252 [1945]; U.S. v. Brown, 381 U.S. 437, 14 L.Ed. 2d. 484
[1965]. Such is the archetypal bill of attainder wielded as a means of legislative
oppression. P.D. No. 293 has clearly been cast from the mould.
Former President Marcos, by establishing martial law, undertook to assume
legislative powers in addition to his regular powers as Chief Executive. He
consolidated in his own person the powers of the Presidency and the powers of
Congress. Such was the theory underlying the streams of decrees, executive
orders, executive proclamations, letters of instruction and the like that he released
upon the nation. The emergence of Presidential Decree No. 293 into public light
underscores the fact that Mr. Marcos also purported at times to exercise judicial
prerogatives. If one viewed PD No. 293 as issued by Mr. Marcos in his presidential
capacity, as it were, the decree is constitutionally vitiated as an exercise of a
power judicial power- deliberately denied to the Chief Executive by the
Constitution. This is made clear in Mr. Justice Narvasa's opinion. If one viewed PD
No. 293 as rendered by Mr. Marcos in his other, assumed i.e. legislative capacity,
the decree is similarly fundamentally flawed as a bill of attainder and ultimately,
again, as an assumption unto himself of a power and authority clearly withheld by
the Constitution from both the Chief Executive and the legislative body and lodged
elsewhere in our Constitutional system.
I vote for the nullification of PD No. 293 by the grant of certiorari.
Separate Opinions
TEEHANKEE, C.J., concurring:
I concur fully in the main opinion forcefully written by Mr. Justice Narvasa and the
separate opinion of Mr. Justice Feliciano depicting the unparalleled "despotic,
capricious, oppressive and unjustifiable exercise of government power" by the
deposed President Ferdinand E. Marcos, as struck down by the Court's
unanimous judgment in the case at bar. To be sure, this is but one of the many
unconstitutional and void Presidential Decrees of the past unlamented regime
which perforce have been so annulled and relief granted to the victims, as they are
brought to the Court's attention.
These arbitrary, capricious and oppressive decrees, tailored to suit the deposed
President's every wish and whim, were the product of unrestrained power, as the
deposed President took over the entire government with the imposition of martial
law in September, 1972. Such unrestrained exercise of power was heightened by
the Court's majority pronouncement in April, 1983 (even as martial law had been
lifted at least on paper two years earlier by Proclamation No. 2045 in January,
1981) that in times of grave emergencies, "The President takes absolute
command, for the very life of the nation and its government, which, incidentally,
includes the courts, is in grave peril. In so doing, the President is answerable only
to his conscience, the people and to God. For their part, in giving him the supreme
mandate as their President, the people can only trust and pray that, giving him
their own loyalty with utmost patriotism, the President will not fail them." 1
Page 119 of 507
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It certainly cannot be gainsaid that such judicial abdication turned back the clock
to lese majeste and dismantled the intricate system of reenforcing rules, principles
and procedures that have evolved through centuries of struggle for the more
efficacious protection through independent courts of the individual's right to life,
liberty and property and due process of law, so that they would no longer have to
depend upon prayers for the purpose.
This concurrence is to express the fervent prayer that we have learned well our
lesson that absolute power corrupts absolutely and that as Thomas Jefferson
warned (which sadly proved to be true in our case), "a single consolidated
government would become the most corrupt government on earth."
We have won back our freedoms and restored democracy with three great
departments of government, and separation of powers and checks and balances.
As Rizal taught us, freedom must be nurtured and cherished, not abused, else we
lose or forfeit it. We must reconsecrate ourselves to the supremacy of the Rule of
Law and renew once more our faith in and adherence to the force of law, rather
than the law of force-for only in the Rule of Law may a democracy survive and
flourish. This means selfless adherence by all to the basics, for as Brandeis aptly
expressed it, "Democracy is a serious undertaking. It is more difficult to maintain
than to achieve. It demands continuous sacrifice by the individual and more
exigent obedience to the moral law than any other form of government."
FELICIANO, J., concurring:
I quite agree with the constitutional law analysis of my learned brother in the Court,
Mr. Justice Narvasa, in his eloquent opinion. I should like simply to add that
Presidential Decree No. 293 is constitutionally offensive for still another reason: it
constitutes a bill of attainder, prohibited not only under the 1935 and 1987
Constitutions but also under the 1973 Constitution.
Bills of attainder are an ancient instrument of tyranny. In England a few centuries
back, Parliament would at times enact bills or statutes which declared certain
persons attainted and their blood corrupted so that it lost all heritable quality (Ex
Parte Garland, 4 Wall. 333, 18 L.Ed. 366 [1867]). In more modem terms, a bill of
attainder is essentially a usurpation of judicial power by a legislative body. It
envisages and effects the imposition of a penalty — the deprivation of life or liberty
or property — not by the ordinary processes of judicial trial, but by legislative fiat.
While cast in the form of special legislation, a bill of attainder (or bill of pains and
penalties, if it prescribed a penalty other than death) is in intent and effect a penal
judgment visited upon an Identified person or group of persons (and not upon the
general community) Without a prior charge or demand, without notice and healing,
without an opportunity to defend, without any of the civilized forms and safeguards
of the judicial process as we know it (People v. Ferrer, 48 SCRA 382 [1972];
Cummings and Missouri, 4 Wall. 277, 18 L.Ed. 356 [1867]; U.S. v. Lovett, 328,
U.S. 303, 90 L.Ed. 1252 [1945]; U.S. v. Brown, 381 U.S. 437, 14 L.Ed. 2d. 484
[1965]. Such is the archetypal bill of attainder wielded as a means of legislative
oppression. P.D. No. 293 has clearly been cast from the mould.
Former President Marcos, by establishing martial law, undertook to assume
legislative powers in addition to his regular powers as Chief Executive. He
consolidated in his own person the powers of the Presidency and the powers of
Congress. Such was the theory underlying the streams of decrees, executive
orders, executive proclamations, letters of instruction and the like that he released
upon the nation. The emergence of Presidential Decree No. 293 into public light
underscores the fact that Mr. Marcos also purported at times to exercise judicial
prerogatives. If one viewed PD No. 293 as issued by Mr. Marcos in his presidential
capacity, as it were, the decree is constitutionally vitiated as an exercise of a
power judicial power- deliberately denied to the Chief Executive by the
Constitution. This is made clear in Mr. Justice Narvasa's opinion. If one viewed PD
No. 293 as rendered by Mr. Marcos in his other, assumed i.e. legislative capacity,
the decree is similarly fundamentally flawed as a bill of attainder and ultimately,
again, as an assumption unto himself of a power and authority clearly withheld by
the Constitution from both the Chief Executive and the legislative body and lodged
elsewhere in our Constitutional system.
I vote for the nullification of PD No. 293 by the grant of certiorari.
G.R. No. 203124 June 22, 2015
PROVINCE OF LEYTE, herein represented by MR. RODOLFO BADIABLE, in
his capacity as the ICO-Provincial Treasurer, Province of Leyte, Petitioner,
vs.
ENERGY DEVELOPMENT CORPORATION, Respondent.
DECISION
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PERLAS-BERNABE, J.:
Assailed in this petition for review on certiorari1 are the Resolutions dated
September 21, 20112 and August 3, 20123of the Court of Appeals (CA) in CA-G.R.
SP No. 04575, which dismissed petitioner Province of Leyte's (Province of Leyte)
petition for certiorari before it on the ground of, inter alia, lack of proof of service of
such petition to the adverse party, respondent Energy Development Corporation
(EDC).
The Facts
Sometime in 2006 and 2007, the Province of Leyte issued four (4) separate
franchise tax assessments against EDC which the latter, in turn, protested
separately. When the Province of Leyte effectively denied all protests, EDC
appealed such denials before the Regional Trial Court of Tacloban City, Branch 6
(RTC), docketed as Civil Case Nos. 2006-05-48, 2006-05-49, 2006-07-77, and
2007-08-03.4 Upon motion of EDC, the RTC issued an Order5 dated February 4,
2008 directing the consolidation of said appeals.6
Notwithstanding the pendency of the cases before the RTC, the Province of Leyte
issued another tax assessment against EDC on February 27, 2008, with the
Assistant Provincial Treasurer verbally intimating to EDC that he was under strict
instruction from the Governor to enforce the collection of tax through the available
administrative remedies upon the lapse of the sixty (60)-day period mentioned in
the assessment.7
This prompted EDC to file a Motion for Issuance of Writ of Preliminary
Injunction8 dated April 4, 2008 praying that the RTC enjoin the Province of Leyte
"from assessing, or attempting to assess, collecting or attempting to collect
franchise taxes from, and availing [itself] of enforcement remedies or actions
against [EDC] until [the pending cases before the RTC] shall have been resolved
with finality."9
In support of its motion, EDC averred that it does not have a franchise; hence, the
Province of Leyte’s assessment of franchise taxes against it is contrary to law and
would result in the payment of illegally exacted taxes if not enjoined. It was further
claimed that should the Province of Leyte’s actions continue, EDC’s operations will
be seriously imperiled and will altogether cease, resulting in loss of substantial
revenues amounting to approximately Twenty One Million Pesos (21,000,000.00)
per day, as well as loss of jobs for its employees. Finally, EDC contends that the
damage that it stands to suffer from the Province of Leyte’s acts is irreparable as
there is no assurance that it will be able to recover such losses.10
The RTC Ruling
In an Order11 dated April 18, 2008, the RTC denied EDC’s motion on the ground
that its grant would in effect dispose of the cases before it. However, on EDC’s
motion,12 the RTC issued an Order13 dated July 17, 2009 setting aside its earlier
order, and accordingly, directed the issuance of a writ of preliminary injunction in
its favor. Contrary to its earlier ruling, the RTC held that the main action would not
be disposed of even though, in the meantime, the Province of Leyte would be
enjoined from collecting franchise taxes from EDC. The RTC further noted that in
case EDC is ultimately held liable for said taxes, the injunction bond would initially
and substantially answer for the Province of Leyte’s claim. On the other hand, if
EDC is compelled to pay such taxes pending resolution of the cases before the
RTC and is subsequently adjudged not liable to pay the same, there is no
assurance that it could recover its operational losses.14
Aggrieved, the Province of Leyte elevated the matter before the CA by way of a
petition for certiorari.15
The CA Ruling
In a Resolution16 dated September 21, 2011, the CA dismissed the petition on the
ground that, inter alia ,"there was no proper proof of service of the [p]etition to the
adverse party. Certainly, registry receipts can hardly be considered sufficient
proper proof of receipt by the addressee of registered mail."17
The Province of Leyte moved for reconsideration,18 which was, however, denied in
a Resolution19 dated August 3, 2012; hence, this petition.20
The Issue Before the Court
The core issue for the Court’s resolution is whether or not the CA correctly
dismissed the Province of Leyte’s certiorari petition before it due to its failure to
provide proof of service of the same on EDC.
The Court's Ruling
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The petition is meritorious.
At the outset, it must be stressed that the instant case was elevated to the CA via
a petition for certiorari which is, by nature, an original and independent action, and
therefore, not considered as part of the trial that had resulted in the rendition of the
judgment or order complained of.21 Being an original action, there is a need for the
CA to acquire jurisdiction over the person of the parties to the case before it can
resolve the same on the merits. Naturally, the CA acquired jurisdiction over the
person of the petitioner – which is the Province of Leyte in this case – upon the
filing of the certiorari petition. On the other hand, Section 4, Rule 46 of the Rules of
Court (Rules), which covers cases originally filed before the CA, provides how the
CA is able to acquire jurisdiction over the person of the respondent:
SEC. 4. Jurisdiction over person of respondent, how acquired. – The court shall
acquire jurisdiction over the person of the respondent by the service on him of its
order or resolution indicating its initial action on the petition or by his voluntary
submission to such jurisdiction.
Thus, in petitions for certiorari filed before the CA , the latter acquires jurisdiction
over the person of the respondent upon: ( a ) the service of the order or resolution
indicating the CA’s initial action on the petition to the respondent; or ( b ) the
voluntary submission of the respondent to the CA’s jurisdiction. In the case at bar,
records reveal that the CA served its Resolution22 dated November 4, 2009
indicating its initial action on the Province of Leyte’s certiorari petition before it, i.e.,
directing EDC to file a comment to the petition, among others. In fact, the EDC
complied with such directive by filing its comment23 dated December 14, 2009 to
such petition. Hence, the CA had already acquired jurisdiction over both parties to
the instant case.
Despite the foregoing, the CA still opted to dismiss the Province of Leyte’s petition
before it on the ground that, inter alia, there was no proper proof of service of the
petition to EDC in accordance with Section 13, Rule 13, of the Rules,24 which
reads:
SEC. 13. Proof of Service. – Proof of personal service shall consist of a written
admission of the party served, or the official return of the server, or the affidavit of
the party serving, containing a full statement of the date, place and manner of
service. If the service is by ordinary mail, proof thereof shall consist of an affidavit
of the person mailing of facts showing compliance with section 7 of this Rule. If
service is made by registered mail, proof shall be made by such affidavit and the
registry receipt issued by the mailing office. The registry return card shall be filed
immediately upon its receipt by the sender or in lieu thereof the unclaimed letter
together with the certified or sworn copy of the notice given by the postmaster to
the addressee.
Relying on Aramburo v. CA,25 the CA held that while the Province of Leyte
presented the registry receipt, it failed to include the registry return card; hence,
there was no valid proof of service to EDC, which must then result in the dismissal
of the Province of Leyte’s petition.26
The CA erred in this regard.
Section 3, Rule 46 of the Rules provides the procedural requirements in filing
original actions before the CA, to wit:
SEC. 3. Contents and filing of petition; effect of non-compliance with requirements.
– The petition shall contain the full names and actual addresses of all the
petitioners and respondents, a concise statement of the matters involved, the
factual background of the case, and the grounds relied upon for the relief prayed
for.
In actions filed under Rule 65, the petition shall further indicate the material dates
showing when notice of the judgment or final order or resolution subject thereof
was received, when a motion for new trial or reconsideration, if any, was filed and
when notice of the denial thereof was received.
It shall be filed in seven (7) clearly legible copies together with proof of service
thereof on the respondent with the original copy intended for the court indicated as
such by the petitioner, and shall be accompanied by clearly legible duplicate
original or certified true copy of the judgment, order, resolution, or ruling subject
thereof, such material portions of the record as are referred to therein, and other
documents relevant or pertinent thereto
The failure of the petitioner to comply with any of the foregoing requirements shall
be sufficient ground for the dismissal of the petition.1âwphi1
Admittedly, the Rules require that the petition filed before the CA should include
proof of service to the other party. Essentially, the purpose of this rule is to apprise
such party of the pendency of an action in the CA. Thus, if such party had already
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been notified of the same and had even participated in the proceedings, such
purpose would have already been served.
Considering that in this case, the CA had already issued a Resolution dated
November 4, 2009 directing EDC to file a comment which the latter had complied
with, it cannot be denied that EDC was already aware of the certiorari proceedings
before the CA and that jurisdiction had been acquired over its person. The CA,
therefore, should have brushed aside the Province of Leyte’s procedural mishap
and resolved the case on the merits in the interest of substantial justice. The
Court’s pronouncement in Barra v. Civil
Service Commission27 is instructive on this matter:
Courts should not be unduly strict in cases involving procedural lapses that do not
really impair the proper administration of justice. Since litigation is not a game of
technicalities, every litigant should be afforded the amplest opportunity for the
proper and just determination of his case, free from the constraints of
technicalities. Procedural rules are mere tools designed to facilitate the attainment
of justice, and even the Rules of Court expressly mandates that "it shall be liberally
construed in order to promote their objective of securing a just, speedy and
inexpensive disposition of every action and proceeding. 28
Verily, the demands of justice require the CA to resolve the issues before it,
considering that what is at stake here are taxes, albeit locally imposed in this case,
which are the nation’s lifeblood through which government agencies continue to
operate and with which the State discharges its functions for the welfare of its
constituents.29 Thus, it is far better and more prudent for the Court to excuse a
technical lapse and afford the parties a substantive review of the case in order to
attain the ends of justice than to dismiss the same on mere technicalities. 30
In view of the foregoing discussion and the fact that the CA had dismissed the
case on purely procedural grounds, the Court deems it appropriate to remand the
case to the CA to thresh out its merits.
WHEREFORE, the petition is GRANTED. Accordingly, the Resolutions dated
September 21, 2011 and August 3, 2012 of the Court of Appeals (CA) in CA-G.R.
SP No. 04575 are hereby REVERSED and SET ASIDE. CA-G.R. SP No. 04575 is
REINSTATED and REMANDED to the CA, which is DIRECTED to resolve the
case on the merits.
SO ORDERED.
G.R. No. 207145 July 28, 2015
GIL G. CAWAD, MARIO BENEDICT P. GALON, DOMINGO E. LUSAYA, JEAN
V. APOLINARES, MA. LUISA S. OREZCA, JULIO R. GARCIA, NESTOR M.
INTIA, RUBEN C. CALIWATAN, ADOLFO Q. ROSALES, MA. LUISA
NAVARRO, and the PHILIPPINE PUBLIC HEALTH ASSOCIATION,
INC., Petitioners,
vs.
FLORENCIO B. ABAD, in his capacity as Secretary of the Department of
Budget and Management (DBM); ENRIQUE T. ONA, in his capacity as
Secretary of the Department of Health (DOH); and FRANCISCO T. DUQUE III,
in his capacity as Chairman of the Civil Service Commission
(CSC), Respondents.
DECISION
PERALTA, J.:
Before the Court is a petition for certiorari and prohibition under Rule 65 of the
Rules of Court filed by the officers and members of the Philippine Public Health
Association, Inc. (PPHAI) assailing the validity of Joint Circular No. 1 1dated
November 29, 2012 of the Department of Budget and Management (DBM) and the
Department of Health (DOH) as well as Item 6.5 of the Joint Circular2 dated
September 3, 2012 of the DBM and the Civil Service Commission (CSC).
The antecedent facts are as follows:
On March 26, 1992, Republic Act (RA) No. 7305, otherwise known as The Magna
Carta of Public Health Workerswas signed into law in order to promote the social
and economic well-being of health workers, their living and working conditions and
terms of employment, to develop their skills and capabilities to be better equipped
to deliver health projects and programs, and to encourage those with proper
qualifications and excellent abilities to join and remain in government
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service.3 Accordingly, public health workers (PHWs) were granted the following
allowances and benefits, among others:
Section 20. Additional Compensation. - Notwithstanding Section 12 of Republic Act
No. 6758, public health workers shall receive the following allowances: hazard
allowance, subsistence allowance, longevity pay, laundry allowance and remote
assignment allowance.
Section 21. Hazard Allowance. - Public health workers in hospitals, sanitaria, rural
health units, main health centers, health infirmaries, barangay health stations,
clinics and other health-related establishments located in difficult areas, strife-torn
or embattled areas, distressed or isolated stations, prisons camps, mental
hospitals, radiation exposed clinics, laboratories or disease-infested areas or in
areas declared under state of calamity or emergency for the duration thereof which
expose them to great danger, contagion, radiation, volcanic activity/eruption,
occupational risks or perils to life as determined by the Secretary of Health or the
Head of the unit with the approval of the Secretary of Health, shall be
compensated hazard allowances equivalent to at least twenty-five percent
(25%) of the monthly basic salary of health workers receiving salary grade 19 and
below, and five percent (5%) for health workers with<="" b="">
Section 22. Subsistence Allowance. - Public health workers who are required to
render service within the premises of hospitals, sanitaria, health infirmaries, main
health centers, rural health units and barangay health stations, or clinics, and other
health-related establishments in order to make their services available at any and
all times, shall be entitled to full subsistence allowance of three (3) meals which
may be computed in accordance with prevailing circumstances as
determined by the Secretary of Health in consultation with the Management-
Health Worker's Consultative Councils, as established under Section 33 of this
Act: Provided, That representation and travel allowance shall be given to rural
health physicians as enjoyed by municipal agriculturists, municipal planning and
development officers and budget officers.
Section 23. Longevity Pay.- A monthly longevity pay equivalent to five percent
(5%)of the monthly basic pay shall be paid to a health worker for every five (5)
years of continuous, efficient and meritorious services rendered as certified
by the chief of office concerned, commencing with the service after the approval of
this Act.4
Pursuant to Section 355 of the Magna Carta, the Secretary of Health promulgated
its Implementing Rules and Regulations (IRR) in July 1992. Thereafter, in
November 1999, the DOH, in collaboration with various government agencies and
health workers' organizations, promulgated a Revised IRR consolidating all
additional and clarificatory rules issued by the former Secretaries of Health dating
back from the effectivity of the Magna Carta. The pertinent provisions of said
Revised IRR provide:
6.3. Longevity Pay.- A monthly longevity pay equivalent to five percent (5%)of the
present monthly basic pay shall be paid to public health workers for every five (5)
years of continuous, efficient and meritorious services rendered as certified by the
Head of Agency/Local Chief Executives commencing after the approval of the Act.
(April 17, 1992)
xxxx
7.1.1. Eligibility to Receive Hazard Pay.- All public health workers covered under
RA 7305 are eligible to receive hazard pay when the nature of their work exposes
them to high risk/low risk hazards for at least fifty percent (50%) of their working
hours as determined and approved by the Secretary of Health or his authorized
representatives.
xxxx
7.2.1. Eligibility for Subsistence Allowance
a. All public health workers covered under RA 7305 are eligible to
receive full subsistence allowance as long as they render actual
duty.
b. Public Health Workers shall be entitled to full Subsistence
Allowance of three (3) meals which may be computed in
accordance with prevailing circumstances as determined by the
Secretary of Health in consultation with the Management-Health
Workers Consultative Council, as established under Section 33 of
the Act.
c. Those public health workers who are out of station shall be
entitled to per diems in place of Subsistence Allowance.
Subsistence Allowance may also be commuted.
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 xxxx
7.2.3 Rates of Subsistence Allowance
a. Subsistence allowance shall be implemented at not less than
Ph₱50.00 per day or Ph₱1,500.00 per month as certified by head
of agency.
xxxx
d. Part-time public health workers/consultants are entitled to one-
half (1/2)of the prescribed rates received by full-time public health
workers.6
On July 28, 2008, the Fourteenth Congress issued Joint Resolution No. 4, entitled
Joint Resolution Authorizing the President of the Philippines to Modify the
Compensation and Position Classification System of Civilian Personnel and the
Base Pay Schedule of Military and Uniformed Personnel in the Government, and
for other Purposes, approved by then President Gloria Macapagal-Arroyo on June
17,2009, which provided for certain amendments in the Magna Carta and its IRR.
On September 3, 2012, respondents DBM and CSC issued one of the two assailed
issuances, DBM-CSC Joint Circular No. 1, Series of 2012, to prescribe the rules
on the grant of Step Increments due to meritorious performance and Step
Increment due to length of service.7 Specifically, it provided that "an official or
employee authorized to be granted Longevity Pay under an existing law is not
eligible for the grant of Step Increment due to length of service."8 Shortly
thereafter, on November29, 2012, respondents DBM and DOH then circulated the
other assailed issuance, DBM-DOH Joint Circular No. 1, Series of 2012, the
relevant provisions of which state:
7.0. Hazard Pay. - Hazard pay is an additional compensation for performing
hazardous duties and for enduring physical hardships in the course of performance
of duties.
As a general compensation policy, and in line with Section 21 of R. A. No. 7305,
Hazard Pay may be granted to PHWs only if the nature of the duties and
responsibilities of their positions, their actual services, and location of work expose
them to great danger, occupational risks, perils of life, and physical hardships; and
only during periods of actual exposure to hazards and hardships.
xxxx
8.3 The Subsistence Allowance shall be ₱50for each day of actual full-time
service, or ₱25for each day of actual part-time service.
xxxx
9.0 Longevity Pay (LP)
9.1 Pursuant to Section 23 of R.A. No. 7305, a PHW may be granted LP at 5% of
his/her current monthly basic salary, in recognition of every 5 years of continuous,
efficient, and meritorious services rendered as PHW. The grant thereof is based on
the following criteria:
9.1.1 The PHW holds a position in the agency plantilla of regular positions; and
9.1.2 He/She has rendered at least satisfactory performance and has not been
found guilty of any administrative or criminal case within all rating periods covered
by the 5-year period.
In a letter9 dated January 23, 2013 addressed to respondents Secretary of Budget
and Management and Secretary of Health, petitioners expressed their opposition
to the Joint Circular cited above on the ground that the same diminishes the
benefits granted by the Magna Carta to PHWs.
Unsatisfied, petitioners, on May 30, 2013, filed the instant petition raising the
following issues:
I.
WHETHER RESPONDENTS ENRIQUE T. ONA AND FLORENCIO B. ABAD
ACTED WITH GRAVE ABUSE OF DISCRETION AND VIOLATED SUBSTANTIVE
DUE PROCESS WHEN THEY ISSUED DBM-DOH JOINT CIRCULAR NO. 1, S.
2012 WHICH:
A) MADE THE PAYMENT OF HAZARD PAY DEPENDENT ON
THE ACTUAL DAYS OF EXPOSURE TO THE RISK INVOLVED;
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 B) ALLOWED PAYMENT OF SUBSISTENCE ALLOWANCE AT
₱50 FOR EACH DAY OF ACTUAL FULL-TIME SERVICE OR ₱25
FOR EACH DAY OF ACTUAL PART-TIME SERVICE WITHOUT
CONSIDERATION OF THE PREVAILING CIRCUMSTANCES AS
DETERMINED BY THE SECRETARY OF HEALTH IN
CONSULTATION WITH THE MANAGEMENT HEALTH
WORKERS' CONSULTATIVE COUNCILS;
C) REQUIRED THAT LONGEVITY PAY BE GRANTED ONLY TO
PHWs WHO HOLD PLANTILLA AND REGULAR POSITIONS;
AND
D) MADE THE JOINT CIRCULAR EFFECTIVE ON JANUARY 1,
2013, BARELY THREE (3) DAYS AFTER IT WAS PUBLISHED IN
A NEWSPAPER OF GENERAL CIRCULATION ON DECEMBER
29, 2012, IN VIOLATION OF THE RULES ON PUBLICATION.
II.
WHETHER RESPONDENTS FRANCISCO T. DUQUE AND FLORENCIO B.
ABAD ACTED WITH GRAVE ABUSE OF DISCRETION WHEN THEY ISSUED
DBM-CSC JOINT CIRCULAR NO. 1, S. 2012 DATED SEPTEMBER 2, 2012
WHICH PROVIDED THAT AN OFFICIAL OR EMPLOYEE ENTITLED TO
LONGEVITY PAY UNDER EXISTING LAW SHALL NO LONGER BE GRANTED
STEP INCREMENT DUE TO LENGTH OF SERVICE.
III.
WHETHER RESPONDENTS' ISSUANCE OF DBM-DOH JOINT CIRCULAR NO.
1, S. 2012 IS NULL AND VOID FOR BEING AN UNDUE EXERCISE OF
LEGISLATIVE POWER BY ADMINISTRATIVE BODIES WHEN RESPONDENT
ONA ALLOWED RESPONDENT ABAD TOSIGNIFICANTLY SHARE THE
POWER TO FORMULATE AND PREPARE THE NECESSARY RULES AND
REGULATIONS TO IMPLEMENT THE PROVISIONS OF THE MAGNA CARTA.
IV.
WHETHER RESPONDENT ONA WAS REMISS IN IMPLEMENTING THE
MANDATE OF THE MAGNA CARTA WHEN HE DID NOT INCLUDE THE
MAGNA CARTA BENEFITS IN THE DEPARTMENT'S YEARLY BUDGET.
V.
WHETHER RESPONDENTS' ISSUANCE OF DBM-DOH JOINT CIRCULAR NO.
1, S. 2012 IS NULL AND VOID FOR BEING AN UNDUE EXERCISE OF
LEGISLATIVE POWER BY ADMINISTRATIVE BODIES WHEN THE SAME WAS
ISSUED SANS CONSULTATION WITH PROFESSIONAL AND HEALTH
WORKERS' ORGANZATIONS AND UNIONS.
Petitioners contend that respondents acted with grave abuse of discretion when
they issued DBM-DOH Joint Circular No. 1, Series of 2012 and DBM-CSC Joint
Circular No. 1, Series of 2012 which prescribe certain requirements on the grant of
benefits that are not otherwise required by RA No. 7305. Specifically, petitioners
assert that the DBM-DOH Joint Circular grants the payment of Hazard Pay only if
the nature of the PHWs' duties expose them to danger when RA No. 7305 does
not make any qualification. They likewise claim that said circular unduly fixes
Subsistence Allowance at ₱50 for each day of full-time service and ₱25 for part-
time service which are not in accordance with prevailing circumstances determined
by the Secretary of Health as required by RA No. 7305. Moreover, petitioners fault
respondents for the premature effectivity of the DBM-DOH Joint Circular which
they believe should have been on January 29, 2012 and not on January 1, 2012.
As to the grant of Longevity Pay, petitioners posit that the same was wrongfully
granted only to PHWs holding regular plantilla positions. Petitioners likewise
criticize the DBM-CSC Joint Circular insofar as it withheld the Step Increment due
to length of service from those who are already being granted Longevity Pay. As a
result, petitioners claim that the subject circulars are void for being an undue
exercise of legislative power by administrative bodies.
In their Comment, respondents, through the Solicitor General, refute petitioners'
allegations in stating that the assailed circulars were issued within the scope of
their authority, and are therefore valid and binding. They also assert the authority
of Joint Resolution No. 4, Series of 2009, approved by the President, in
accordance with the prescribed procedure. Moreover, respondents question the
remedies of Certiorari and Prohibition used by petitioners for the assailed circulars
were done in the exercise of their quasi-legislative, and not of their judicial or
quasi-judicial functions.
The petition is partly meritorious.
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At the outset, the petition for certiorari and prohibition filed by petitioners is not the
appropriate remedy to assail the validity of respondents' circulars. Sections 1 and
2 of Rule 65 of the Rules of Court provide:
RULE 65
CERTIORARI, PROHIBITION AND MANDAMUS
Section 1. Petition for certiorari. - When any tribunal, board or officer exercising
judicial or quasi-judicial functions has acted without or in excess of its or his
jurisdiction, or with grave abuse of discretion amounting to lack or excess of
jurisdiction, and there is no appeal, or any plain, speedy, and adequate remedy in
the ordinary course of law, a person aggrieved thereby may file a verified petition
in the proper court, alleging the facts with certainty and praying that judgment be
rendered annulling or modifying the proceedings of such tribunal, board or officer,
and granting such incidental reliefs as law and justice may require.
xxxx
Sec. 2. Petition for Prohibition. - When the proceedings of any tribunal,
corporation, board, officer or person, whether exercising judicial, quasi-judicial or
ministerial functions, are without or in excess of its jurisdiction, or with grave abuse
of discretion amounting to lack or excess of jurisdiction, and there is no appeal or
any other plain, speedy, and adequate remedy in the ordinary course of law, a
person aggrieved thereby may file a verified petition in the proper court, alleging
the facts with certainty and praying that judgment be rendered commanding the
respondent to desist from further proceedings in the action or matter specified
therein, or otherwise granting such incidental reliefs as law and justice may
require.10
Thus, on the one hand, certiorari as a special civil action is available only if: (1) it is
directed against a tribunal, board, or officer exercising judicial or quasi-judicial
functions; (2) the tribunal, board, or officer acted without or in excess of jurisdiction
or with grave abuse of discretion amounting to lack or excess of jurisdiction; and
(3) there is no appeal nor any plain, speedy, and adequate remedy in the ordinary
course of law.11
On the other hand, prohibition is available only if: (1) it is directed against a
tribunal, corporation, board, officer, or person exercising functions, judicial, quasi-
judicial, or ministerial; (2) the tribunal, corporation, board or person acted without
or in excess of its jurisdiction, or with grave abuse of discretion amounting to lack
or excess of jurisdiction; and (3) there is no appeal or any other plain, speedy, and
adequate remedy in the ordinary course of law.12 Based on the foregoing, this
Court has consistently reiterated that petitions for certiorari and prohibition may be
invoked only against tribunals, corporations, boards, officers, or persons exercising
judicial, quasi-judicial or ministerial functions, and not against their exercise of
legislative or quasi-legislative functions.13
Judicial functions involve the power to determine what the law is and what the
legal rights of the parties are, and then undertaking to determine these questions
and adjudicate upon the rights of the parties.14 Quasi judicial functions apply to the
actions and discretion of public administrative officers or bodies required to
investigate facts, hold hearings, and draw conclusions from them as a basis for
their official action, in their exercise of discretion of a judicial nature.15 Ministerial
functions are those which an officer or tribunal performs in the context of a given
set of facts, in a prescribed manner and without regard to the exercise of his own
judgment upon the propriety or impropriety of the act done.16
Before a tribunal, board, or officer may exercise judicial or quasi-judicial acts, it is
necessary that there be a law that gives rise to some specific rights under which
adverse claims are made, and the controversy ensuing therefrom is brought before
a tribunal, board, or officer clothed with authority to determine the law and
adjudicate the respective rights of the contending parties. 17 In this case,
respondents did not act in any judicial, quasi-judicial, or ministerial capacity in their
issuance of the assailed joint circulars. In issuing and implementing the subject
circulars, respondents were not called upon to adjudicate the rights of contending
parties to exercise, in any manner, discretion of a judicial nature. The issuance and
enforcement by the Secretaries of the DBM, CSC and DOH of the questioned joint
circulars were done in the exercise of their quasi-legislative and administrative
functions. It was in the nature of subordinate legislation, promulgated by them in
their exercise of delegated power. Quasi-legislative power is exercised by
administrative agencies through the promulgation of rules and regulations within
the confines of the granting statute and the doctrine of non-delegation of powers
from the separation of the branches of the government.18
Based on the foregoing, certiorari and prohibition do not lie against herein
respondents' issuances. It is beyond the province of certiorari to declare the
aforesaid administrative issuances illegal because petitions for certiorari seek
solely to correct defects in jurisdiction, and not to correct just any error committed
by a court, board, or officer exercising judicial or quasi-judicial functions unless
such court, board, or officer thereby acts without or in excess of jurisdiction or with
such grave abuse of discretion amounting to lack of jurisdiction.19
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It is likewise beyond the territory of a writ of prohibition since generally, the
purpose of the same is to keep a lower court within the limits of its jurisdiction in
order to maintain the administration of justice in orderly channels. It affords relief
against usurpation of jurisdiction by an inferior court, or when, in the exercise of
jurisdiction, the inferior court transgresses the bounds prescribed by the law, or
where there is no adequate remedy available in the ordinary course of law.20
Be that as it may, We proceed to discuss the substantive issues raised in the
petition in order to finally resolve the doubt over the Joint Circulars' validity. For
proper guidance, the pressing issue of whether or not the joint circulars regulating
the salaries and benefits relied upon by public health workers were tainted with
grave abuse of discretion rightly deserves its prompt resolution. With respect to the
infirmities of the DBM-DOH Joint Circular raised in the petition, they cannot be said
to have been issued with grave abuse of discretion for not only are they
reasonable, they were likewise issued well within the scope of authority granted to
the respondents. In fact, as may be gathered from prior issuances on the matter,
the circular did not make any substantial deviation therefrom, but actually
remained consistent with, and germane to, the purposes of the law.
First, the qualification imposed by the DBM-DOH Joint Circular granting the
payment of Hazard Pay only if the nature of PHWs' duties expose them to danger
and depending on whether the risk involved is high or low was merely derived from
Section 7.1.1 of the Revised IRR of RA No. 7305, duly promulgated by the DOH in
collaboration with various government health agencies and health workers'
organizations in November 1999, to wit:
SECTION 7.1.1. Eligibility to Receive Hazard Pay. - All public health workers
covered under RA 7305 are eligible to receive hazard pay when the nature of their
work exposes them to high risk/low risk hazards for at least fifty percent (50%) of
their working hours as determined and approved by the Secretary of Health or his
authorized representatives.21
Second, fixing the Subsistence Allowance at ₱50 for each day of full-time service
and ₱25 for part-time service was also merely a reiteration of the limits prescribed
by the Revised IRR, validly issued by the Secretary of Health pursuant to Section
3522 of RA No. 7305, the pertinent portions of which states:
Section 7.2.3 Rates of Subsistence Allowance
a. Subsistence allowance shall be implemented at not less than Ph₱50.00 per day
or Ph₱1,500.00 per month as certified by head of agency.
xxxx
d. Part-time public health workers/consultants are entitled to one-half (1/2)of the
prescribed rates received by full-time public health workers.
Third, the condition imposed by the DBM-DOH Joint Circular granting longevity
pay only to those PHWs holding regular plantilla positions merely implements the
qualification imposed by the Revised IRR which provides:
6.3. Longevity Pay. - A monthly longevity pay equivalent to five percent (5%) of the
present monthly basic pay shall be paid to public health workers for every five (5)
years of continuous, efficient and meritorious services rendered as certified by the
Head of Agency/Local Chief Executives commencing after the approval of the Act.
(April 17, 1992)
6.3.1. Criteria for Efficient and Meritorious Service A Public Worker shall have:
a. At least a satisfactory performance rating within the rating period.
b. Not been found guilty of any administrative or criminal case within the rating
period.
As can be gleaned from the aforequoted provision, petitioners failed to show any
real inconsistency in granting longevity pay to PHWs holding regular plantilla
positions. Not only are they based on the same premise, but the intent of longevity
pay, which is paid to workers for every five (5) years of continuous, efficient and
meritorious services, necessarily coincides with that of regularization. Thus, the
assailed circular cannot be invalidated for its issuance is consistent with, and
germane to, the purposes of the law.
Anent petitioners' contention that the DBM-DOH Joint Circular is null and void for
its failure to comply with Section 3523 of RA No. 7305 providing that its
implementing rules shall take effect thirty (30) days after publication in a
newspaper of general circulation, as well as its failure to file a copy of the same
with the University of the Philippines Law Center-Office of the National
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Administrative Register (UP Law Center-ONAR), jurisprudence as well as the
circumstances of this case dictate otherwise.
Indeed, publication, as a basic postulate of procedural due process, is required by
law in order for administrative rules and regulations to be effective. 24 There are,
however, several exceptions, one of which are interpretative regulations which
"need nothing further than their bare issuance for they give no real consequence
more than what the law itself has already prescribed."25 These regulations need
not be published for they add nothing to the law and do not affect substantial rights
of any person.26
Thus, in Association of Southern Tagalog Electric Cooperatives, et. al. v. Energy
Regulatory Commission (ERC),27wherein several orders issued by the ERC were
sought to be invalidated for lack of publication and non-submission of copies
thereof to the UP Law Center - ONAR, it has been held that since they merely
interpret RA No. 7832 and its IRR, particularly on the computation of the cost of
purchased power, without modifying, amending or supplanting the same, they
cannot be rendered ineffective, to wit:
When the policy guidelines of the ERC directed the exclusion of discounts
extended by power suppliers in the computation of the cost of purchased power,
the guidelines merely affirmed the plain and unambiguous meaning of "cost" in
Section 5, Rule IX of the IRR of R.A. No. 7832."Cost" is an item of outlay, and
must therefore exclude discounts since these are "not amounts paid or charged for
the sale of electricity, but are reductions in rates.
xxxx
Thus, the policy guidelines of the ERC on the treatment of discounts extended by
power suppliers "give no real consequence more than what the law itself has
already prescribed." Publication is not necessary for the effectivity of the policy
guidelines.
As interpretative regulations, the policy guidelines of the ERC on the treatment of
discounts extended by power suppliers are also not required to be filed with the
U.P. Law Center in order to be effective. Section 4, Chapter 2, Book VII of the
Administrative Code of 1987 requires every rule adopted by an agency to be filed
with the U.P. Law Center to be effective. However, in Board of Trustees of the
Government Service Insurance System v. Velasco, this Court pronounced that "not
all rules and regulations adopted by every government agency are to be filed with
the UP Law Center." Interpretative regulations and those merely internal in nature
are not required to be filed with the U.P. Law Center. Paragraph 9 (a) of the
Guidelines for Receiving and Publication of Rules and Regulations Filed with the
U.P. Law Center states:
9. Rules and Regulations which need not be filed with the U.P. Law Center, shall,
among others, include but not be limited to, the following:
a. Those which are interpretative regulations and those merely internal in nature,
that is, regulating only the personnel of the Administrative agency and not the
public.
xxxx
Furthermore, the policy guidelines of the ERC did not create a new
obligation and impose a new duty, nor did it attach a new disability. As
previously discussed, the policy guidelines merely interpret R.A. No. 7832
and its IRR, particularly on the computation of the cost of purchased power.
The policy guidelines did not modify, amend or supplant the IRR.
Similarly, in Republic v. Drugmaker's Laboratories, Inc.,28 the validity of circulars
issued by the Food and Drug Administration (FDA) was upheld in spite of the non-
compliance with the publication, prior hearing, and consultation requirements for
they merely implemented the provisions of Administrative Order No. 67, entitled
"Revised Rules and Regulations on Registration of Pharmaceutical Products"
issued by the DOH, in the following wise:
A careful scrutiny of the foregoing issuances would reveal that AO 67, s.
1989 is actually the rule that originally introduced the BA/BE testing
requirement as a component of applications for the issuance of CPRs
covering certain pharmaceutical products. As such, it is considered an
administrative regulation - a legislative rule to be exact - issued by the Secretary of
Health in consonance with the express authority granted to him by RA 3720 to
implement the statutory mandate that all drugs and devices should first be
registered with the FDA prior to their manufacture and sale. Considering that
neither party contested the validity of its issuance, the Court deems that AO 67, s.
1989 complied with the requirements of prior hearing, notice, and publication
pursuant to the presumption of regularity accorded to the government in the
exercise of its official duties.42
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On the other hand, Circular Nos. 1 and 8, s. 1997 cannot be considered as
administrative regulations because they do not: (a) implement a primary
legislation by providing the details thereof; (b) interpret, clarify, or explain
existing statutory regulations under which the FDA operates; and/or (c)
ascertain the existence of certain facts or things upon which the
enforcement of RA 3720 depends. In fact, the only purpose of these circulars
is for the FDA to administer and supervise the implementation of the
provisions of AO 67, s. 1989, including those covering the BA/BE testing
requirement, consistent with and pursuant to RA 3720.43 Therefore, the FDA
has sufficient authority to issue the said circulars and since they would not
affect the substantive rights of the parties that they seek to govern - as they
are not, strictly speaking, administrative regulations in the first place - no
prior hearing, consultation, and publication are needed for their validity.
In this case, the DBM-DOH Joint Circular in question gives no real consequence
more than what the law itself had already prescribed. As previously discussed, the
qualification of actual exposure to danger for the PHW's entitlement to hazard pay,
the rates of ₱50 and ₱25 subsistence allowance, and the entitlement to longevity
pay on the basis of PHW's status in the plantilla of regular positions were already
prescribed and authorized by pre-existing law. There is really no new obligation or
duty imposed by the subject circular for it merely reiterated those embodied in RA
No. 7305 and its Revised IRR. The Joint Circular did not modify, amend nor
supplant the Revised IRR, the validity of which is undisputed. Consequently,
whether it was duly published and filed with the UP Law Center - ONAR is
necessarily immaterial to its validity because in view of the pronouncements
above, interpretative regulations, such as the DBM-DOH circular herein, need not
be published nor filed with the UP Law Center - ONAR in order to be effective.
Neither is prior hearing or consultation mandatory.
Nevertheless, it bears stressing that in spite of the immateriality of the publication
requirement in this case, and even assuming the necessity of the same, its basic
objective in informing the public of the contents of the law was sufficiently
accomplished when the DBM-DOH Joint Circular was published in the Philippine
Star, a newspaper of general circulation, on December 29, 2012.29
As to petitioners' allegation of grave abuse of discretion on the part of respondent
DOH Secretary in failing to include the Magna Carta benefits in his department's
yearly budget, the same is belied by the fact that petitioners themselves
specifically provided in their petition an account of the amounts allocated for the
same in the years 2012 and 2013.30
Based on the foregoing, it must be recalled that administrative regulations, such as
the DBM-DOH Joint Circular herein, enacted by administrative agencies to
implement and interpret the law they are entrusted to enforce are entitled to great
respect.31 They partake of the nature of a statute and are just as binding as if they
have been written in the statute itself. As such, administrative regulations have the
force and effect of law and enjoy the presumption of legality. Unless and until they
are overcome by sufficient evidence showing that they exceeded the bounds of the
law,32 their validity and legality must be upheld.
Thus, notwithstanding the contention that the Joint Resolution No. 4 promulgated
by Congress cannot be a proper source of delegated power, the subject Circular
was nevertheless issued well within the scope of authority granted to the
respondents. The issue in this case is not whether the Joint Resolution No. 4 can
become law and, consequently, authorize the issuance of the regulation in
question, but whether the circular can be struck down as invalid for being tainted
with grave abuse of discretion. Regardless, therefore, of the validity or invalidity of
Joint Resolution No. 4, the DBMDOH Joint Circular assailed herein cannot be said
to have been arbitrarily or capriciously issued for being consistent with prior
issuances duly promulgated pursuant to valid and binding law.
Distinction must be made, however, with respect to the DBM-CSC Joint Circular,
the contested provision of which states:
6.5 An official or employee authorized to be granted Longevity Pay under an
existing law is not eligible for the grant of Step Increment Due to Length of Service.
A review of RA No. 7305 and its Revised IRR reveals that the law does not
similarly impose such condition on the grant of longevity pay to PHWs in the
government service. As such, the DBM-CSC Joint Circular effectively created a
new imposition which was not otherwise stipulated in the law it sought to interpret.
Consequently, the same exception granted to the DBM-DOH Joint Circular cannot
be applied to the DBM-CSC Joint Circular insofar as the requirements on
publication and submission with the UP Law Center - ONAR are concerned. Thus,
while it was well within the authority of the respondents to issue rules regulating
the grant of step increments as provided by RA No. 6758, otherwise known as the
Compensation and Position Classification Act of 1989, which pertinently states:
Section 13. Pay Adjustments. - Paragraphs (b) and (c), Section 15 of Presidential
Decree No. 985 are hereby amended to read as follows:
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 xxxx
(c) Step Increments- Effective January 1, 1990 step increments shall be granted
based on merit and/or length of service in accordance with rules and regulations
that will be promulgated jointly by the DBM and the Civil Service Commission,
and while it was duly published in the Philippine Star, a newspaper of general
circulation, on September 15, 2012,33the DBM-CSC Joint Circular remains
unenforceable for the failure of respondents to file the same with the UP Law
Center - ONAR.34 Moreover, insofar as the DBM-DOH Joint Circular similarly
withholds the Step Increment due to length of service from those who are already
being granted Longevity Pay, the same must likewise be declared
unenforceable.[35
Note also that the DBM-DOH Joint Circular must further be invalidated insofar as it
lowers the hazard pay at rates below the minimum prescribed by Section 21 of RA
No. 7305 and Section 7.1.5 (a) of its Revised IRR as follows:
SEC. 21. Hazard Allowance. - Public health worker in hospitals, sanitaria, rural
health units, main centers, health infirmaries, barangay health stations, clinics and
other health-related establishments located in difficult areas, strife-torn or
embattled areas, distresses or isolated stations, prisons camps, mental hospitals,
radiation-exposed clinics, laboratories or disease-infested areas or in areas
declared under state of calamity or emergency for the duration thereof which
expose them to great danger, contagion, radiation, volcanic activity/eruption
occupational risks or perils to life as determined by the Secretary of Health or the
Head of the unit with the approval of the Secretary of Health, shall be
compensated hazard allowance equivalent to at least twenty-five percent (25%)of
the monthly basic salary of health workers receiving salary grade 19 and below,
and five percent (5%) for health workers with salary grade 20 and above.
xxxx
7.1.5. Rates of Hazard Pay
a. Public health workers shall be compensated hazard allowances equivalent to at
least twenty five (25%)of the monthly basic salary of health workers, receiving
salary grade 19 and below, and five percent (5%)for health workers with salary
grade 20 and above. This may be granted on a monthly, quarterly or annual basis.
It is evident from the foregoing provisions that the rates of hazard pay must be at
least25% of the basic monthly salary of PWHs receiving salary grade 19 and
below, and 5% receiving salary grade 20 and above. As such, RA No. 7305 and its
implementing rules noticeably prescribe the minimum rates of hazard pay due all
PHWs in the government, as is clear in the self-explanatory phrase "at least" used
in both the law and the rules.36 Thus, the following rates embodied in Section 7.2
of DBM-DOH Joint Circular must be struck down as invalid for being contrary to
the mandate of RA No. 7305 and its Revised IRR:
7.2.1 For PHWs whose positions are at SG-19 and below, Hazard Pay shall be
based on the degree of exposure to high risk or low risk hazards, as specified in
sub-items 7 .1.1 and 7 .1.2 above, and the number of workdays of actual exposure
over 22 workdays in a month, at rates not to exceed 25% of monthly basic salary.
In case of exposure to both high risk and low risk hazards, the Hazard Pay for the
month shall be based on only one risk level, whichever is more advantageous to
the PHW.
7.2.2 PHWs whose positions are at SG-20 and above may be entitled to Hazard
Pay at 5% of their monthly basic salaries for all days of exposure to high risk
and/or low risk hazards. However, those exposed to high risk hazards for 12 or
more days in a month may be entitled to a fixed amount of ₱4,989.75 per month.
Rates of Hazard Pay
Actual Exposure/ High Risk Low Risk
Level of Risk
12 or more days 25% of monthly basic salary 14% of monthly basic salary
6 to 11 days 14% of monthly basic salary 8% of monthly basic salary
Less than 6 days 8% monthly basic salary 5% of monthly basic salary
WHEREFORE, premises considered, the instant petition is PARTLY GRANTED.
The DBM-DOH Joint Circular, insofar as it lowers the hazard pay at rates below
the minimum prescribed by Section 21 of RA No. 7305 and Section 7.1.5 (a) of its
Revised IRR, is declared INVALID. The DBM-CSC Joint Circular, insofar as it
provides that an official or employee authorized to be granted Longevity Pay under
an existing law is not eligible for the grant of Step Increment Due to Length of
Service, is declared UNENFORCEABLE. The validity, however, of the DBM-DOH
Joint Circular as to the qualification of actual exposure to danger for the PHW's
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entitlement to hazard pay, the rates of ₱50 and ₱25 subsistence allowance, and
the entitlement to longevity pay on the basis of the PHW' s status in the plantilla of
regular positions, is UPHELD.
SO ORDERED.
PROHIBITION
G.R. No. 191424 August 7, 2013
ALFEO D. VIVAS, ON HIS BEHALF AND ON BEHALF OF THE
SHAREHOLDERS OF EUROCREDIT COMMUNITY BANK, PETITIONER,
vs.
THE MONETARY BOARD OF THE BANGKO SENTRAL NG PILIPINAS AND
THE PHILIPPINE DEPOSIT INSURANCE CORPORATION, RESPONDENTS.
DECISION
MENDOZA, J.:
This is a petition for prohibition with prayer for the issuance of a status quo ante
order or writ of preliminary injunction ordering the respondents to desist from
closing EuroCredit Community Bank, Incorporated (ECBI) and from pursuing the
receivership thereof. The petition likewise prays that the management and
operation of ECBI be restored to its Board of Directors (BOD) and its officers.
The Facts
The Rural Bank of Faire, Incorporated (RBFI) was a duly registered rural banking
institution with principal office in Centro Sur, Sto. Niño, Cagayan. Record shows
that the corporate life of RBFI expired on May 31, 2005.1Notwithstanding,
petitioner Alfeo D. Vivas (Vivas) and his principals acquired the controlling interest
in RBFI sometime in January 2006. At the initiative of Vivas and the new
management team, an internal audit was conducted on RBFI and results thereof
highlighted the dismal operation of the rural bank. In view of those findings, certain
measures calculated to revitalize the bank were allegedly introduced. 2 On
December 8, 2006, the Bangko Sentral ng Pilipinas (BSP) issued the Certificate of
Authority extending the corporate life of RBFI for another fifty (50) years. The BSP
also approved the change of its corporate name to EuroCredit Community Bank,
Incorporated, as well as the increase in the number of the members of its BOD,
from five (5) to eleven (11).3
Pursuant to Section 28 of Republic Act (R.A.) No. 7653, otherwise known as The
New Central Bank Act, the Integrated Supervision Department II (ISD II) of the
BSP conducted a general examination on ECBI with the cut-off date of December
31, 2007. Shortly after the completion of the general examination, an exit
conference was held on March 27, 2008 at the BSP during which the BSP officials
and examiners apprised Vivas, the Chairman and President of ECBI, as well as
the other bank officers and members of its BOD, of the advance findings noted
during the said examination. The ECBI submitted its comments on BSP’s
consolidated findings and risk asset classification through a letter, dated April 8,
2008.4
Sometime in April 2008, the examiners from the Department of Loans and Credit
of the BSP arrived at the ECBI and cancelled the rediscounting line of the bank.
Vivas appealed the cancellation to BSP.5 Thereafter, the Monetary Board (MB)
issued Resolution No. 1255, dated September 25, 2008, placing ECBI under
Prompt Corrective Action (PCA) framework because of the following serious
findings and supervisory concerns noted during the general examination: 1]
negative capital of ?14.674 million and capital adequacy ratio of negative 18.42%;
2] CAMEL (Capital Asset Management Earnings Liquidity) composite rating of "2"
with a Management component rating of "1"; and 3] serious supervisory concerns
particularly on activities deemed unsafe or unsound.6 Vivas claimed that the BSP
took the above courses of action due to the joint influence exerted by a certain
hostile shareholder and a former BSP examiner.7
Through its letter, dated September 30, 2008, the BSP furnished ECBI with a copy
of the Report of Examination (ROE) as of December 31, 2007. In addition, the BSP
directed the bank’s BOD and senior management to: 1] infuse fresh capital of
?22.643 million; 2] book the amount of ?28.563 million representing unbooked
valuation reserves on classified loans and other risks assets on or before October
31, 2008; and 3] take appropriate action necessary to address the
violations/exceptions noted in the examination.8
Vivas moved for a reconsideration of Resolution No. 1255 on the grounds of non-
observance of due process and arbitrariness. The ISD II, on several instances, had
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invited the BOD of ECBI to discuss matters pertaining to the placement of the bank
under PCA framework and other supervisory concerns before making the
appropriate recommendations to the MB. The proposed meeting, however, did not
materialize due to postponements sought by Vivas.9
In its letter, dated February 20, 2009, the BSP directed ECBI to explain why it
transferred the majority shares of RBFI without securing the prior approval of the
MB in apparent violation of Subsection X126.2 of the Manual of Regulation for
Banks (MORB).10 Still in another letter,11 dated March 31, 2009, the ISD II required
ECBI to explain why it did not obtain the prior approval of the BSP anent the
establishment and operation of the bank’s sub-offices.
Also, the scheduled March 31, 2009 general examination of the books, records
and general condition of ECBI with the cut-off date of December 31, 2008, did not
push through. According to Vivas, ECBI asked for the deferment of the
examination pending resolution of its appeal before the MB. Vivas believed that he
was being treated unfairly because the letter of authority to examine allegedly
contained a clause which pertained to the Anti-Money Laundering Law and the
Bank Secrecy Act.12
The MB, on the other hand, posited that ECBI unjustly refused to allow the BSP
examiners from examining and inspecting its books and records, in violation of
Sections 25 and 34 of R.A. No. 7653. In its letter,13 dated May 8, 2009, the BSP
informed ECBI that it was already due for another annual examination and that the
pendency of its appeal before the MB would not prevent the BSP from conducting
another one as mandated by Section 28 of R.A. No. 7653.
In view of ECBI’s refusal to comply with the required examination, the MB issued
Resolution No. 726,14 dated May 14, 2009, imposing monetary penalty/fine on
ECBI, and referred the matter to the Office of the Special Investigation (OSI) for
the filing of appropriate legal action. The BSP also wrote a letter,15 dated May 26,
2009, advising ECBI to comply with MB Resolution No. 771, which essentially
required the bank to follow its directives. On May 28, 2009, the ISD II reiterated its
demand upon the ECBI BOD to allow the BSP examiners to conduct a general
examination on June 3, 2009.16
In its June 2, 2009 Letter-Reply,17 ECBI asked for another deferment of the
examination due to the pendency of certain unresolved issues subject of its appeal
before the MB, and because Vivas was then out of the country. The ISD II denied
ECBI’s request and ordered the general examination to proceed as previously
scheduled.18
Thereafter, the MB issued Resolution No. 823,19 dated June 4, 2009, approving
the issuance of a cease and desist order against ECBI, which enjoined it from
pursuing certain acts and transactions that were considered unsafe or unsound
banking practices, and from doing such other acts or transactions constituting
fraud or might result in the dissipation of its assets.
On June 10, 2009, the OSI filed with the Department of Justice (DOJ) a complaint
for Estafa Through Falsification of Commercial Documents against certain officials
and employees of ECBI. Meanwhile, the MB issued Resolution No. 1164, 20 dated
August 13, 2009, denying the appeal of ECBI from Resolution No. 1255 which
placed it under PCA framework. On November 18, 2009, the general examination
of the books and records of ECBI with the cut-off date of September 30, 2009, was
commenced and ended in December 2009. Later, the BSP officials and examiners
met with the representatives of ECBI, including Vivas, and discussed their
findings.21 On December 7, 2009, the ISD II reminded ECBI of the non-submission
of its financial audit reports for the years 2007 and 2008 with a warning that failure
to submit those reports and the written explanation for such omission shall result in
the imposition of a monetary penalty.22 In a letter, dated February 1, 2010, the ISD
II informed ECBI of MB Resolution No. 1548 which denied its request for
reconsideration of Resolution No. 726.
On March 4, 2010, the MB issued Resolution No. 276 23 placing ECBI under
receivership in accordance with the recommendation of the ISD II which reads:
On the basis of the examination findings as of 30 September 2009 as reported by
the Integrated Supervision Department (ISD) II, in its memorandum dated 17
February 2010, which findings showed that the Eurocredit Community Bank, Inc. –
a Rural Bank (Eurocredit Bank) (a) is unable to pay its liabilities as they become
due in the ordinary course of business; (b) has insufficient realizable assets to
meet liabilities; (c) cannot continue in business without involving probable losses to
its depositors and creditors; and (d) has willfully violated a cease and desist order
of the Monetary Board for acts or transactions which are considered unsafe and
unsound banking practices and other acts or transactions constituting fraud or
dissipation of the assets of the institution, and considering the failure of the Board
of Directors/management of Eurocredit Bank to restore the bank’s financial health
and viability despite considerable time given to address the bank’s financial
problems, and that the bank had been accorded due process, the Board, in
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accordance with Section 30 of Republic Act No. 7653 (The New Central Bank Act),
approved the recommendation of ISD II as follows:
To prohibit the Eurocredit Bank from doing business in the Philippines and to place
its assets and affairs under receivership; and
To designate the Philippine Deposit Insurance Corporation as Receiver of the
bank.
Assailing MB Resolution No. 276, Vivas filed this petition for prohibition before this
Court, ascribing grave abuse of discretion to the MB for prohibiting ECBI from
continuing its banking business and for placing it under receivership. The petitioner
presents the following
ARGUMENTS:
(a)
It is grave abuse of discretion amounting to loss of jurisdiction to apply the general
law embodied in Section 30 of the New Central Bank Act as opposed to the
specific law embodied in Sections 11 and 14 of the Rural Banks Act of 1992.
(b)
Even if it assumed that Section 30 of the New Central Bank Act is applicable, it is
still the gravest abuse of discretion amounting to lack or excess of jurisdiction to
execute the law with manifest arbitrariness, abuse of discretion, and bad faith,
violation of constitutional rights and to further execute a mandate well in excess of
its parameters.
(c)
The power delegated in favor of the Bangko Sentral ng Pilipinas to place rural
banks under receiverships is unconstitutional for being a diminution or invasion of
the powers of the Supreme Court, in violation of Section 2, Article VIII of the
Philippine Constitution.24
Vivas submits that the respondents committed grave abuse of discretion when
they erroneously applied Section 30 of R.A. No. 7653, instead of Sections 11 and
14 of the Rural Bank Act of 1992 or R.A. No. 7353. He argues that despite the
deficiencies, inadequacies and oversights in the conduct of the affairs of ECBI, it
has not committed any financial fraud and, hence, its placement under
receivership was unwarranted and improper. He posits that, instead, the BSP
should have taken over the management of ECBI and extended loans to the
financially distrained bank pursuant to Sections 11 and 14 of R.A. No. 7353
because the BSP’s power is limited only to supervision and management take-over
of banks.
He contends that the implementation of the questioned resolution was tainted with
arbitrariness and bad faith, stressing that ECBI was placed under receivership
without due and prior hearing in violation of his and the bank’s right to due
process. He adds that respondent PDIC actually closed ECBI even in the absence
of any directive to this effect. Lastly, Vivas assails the constitutionality of Section
30 of R.A. No. 7653 claiming that said provision vested upon the BSP the
unbridled power to close and place under receivership a hapless rural bank
instead of aiding its financial needs. He is of the view that such power goes way
beyond its constitutional limitation and has transformed the BSP to a sovereign in
its own "kingdom of banks."25
The Court’s Ruling
The petition must fail.
Vivas Availed of the Wrong Remedy
To begin with, Vivas availed of the wrong remedy. The MB issued Resolution No.
276, dated March 4, 2010, in the exercise of its power under R.A. No. 7653. Under
Section 30 thereof, any act of the MB placing a bank under conservatorship,
receivership or liquidation may not be restrained or set aside except on a petition
for certiorari. Pertinent portions of R.A. 7653 read:
Section 30. –
x x x x.
The actions of the Monetary Board taken under this section or under Section 29 of
this Act shall be final and executory, and may not be restrained or set aside by the
court except on petition for certiorari on the ground that the action taken was in
excess of jurisdiction or with such grave abuse of discretion as to amount to lack or
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excess of jurisdiction. The petition for certiorari may only be filed by the
stockholders of record representing the majority of the capital stock within ten (10)
days from receipt by the board of directors of the institution of the order directing
receivership, liquidation or conservatorship.
x x x x. [Emphases supplied]
Prohibition is already unavailing
Granting that a petition for prohibition is allowed, it is already an ineffective remedy
under the circumstances obtaining. Prohibition or a "writ of prohibition" is that
process by which a superior court prevents inferior courts, tribunals, officers, or
persons from usurping or exercising a jurisdiction with which they have not been
vested by law, and confines them to the exercise of those powers legally
conferred. Its office is to restrain subordinate courts, tribunals or persons from
exercising jurisdiction over matters not within its cognizance or exceeding its
jurisdiction in matters of which it has cognizance.26 In our jurisdiction, the rule on
prohibition is enshrined in Section 2, Rule 65 of the Rules on Civil Procedure, to
wit:
Sec. 2. Petition for prohibition - When the proceedings of any tribunal, corporation,
board, officer or person, whether exercising judicial, quasi-judicial or ministerial
functions, are without or in excess of its or his jurisdiction, or with grave abuse of
discretion amounting to lack or excess of jurisdiction, and there is no appeal or any
other plain, speedy, and adequate remedy in the ordinary course of law, a person
aggrieved thereby may file a verified petition in the proper court, alleging the facts
with certainty and praying that the judgment be rendered commanding the
respondent to desist from further proceedings in the action or matter specified
therein, or otherwise granting such incidental reliefs as the law and justice require.
x x x x.
Indeed, prohibition is a preventive remedy seeking that a judgment be rendered
which would direct the defendant to desist from continuing with the commission of
an act perceived to be illegal.27 As a rule, the proper function of a writ of prohibition
is to prevent the doing of an act which is about to be done. It is not intended to
provide a remedy for acts already accomplished.28
Though couched in imprecise terms, this petition for prohibition apparently seeks
to prevent the acts of closing of ECBI and placing it under receivership. Resolution
No. 276, however, had already been issued by the MB and the closure of ECBI
and its placement under receivership by the PDIC were already accomplished.
Apparently, the remedy of prohibition is no longer appropriate. Settled is the rule
that prohibition does not lie to restrain an act that is already a fait accompli.29
The Petition Should Have Been Filed in the CA
Even if treated as a petition for certiorari, the petition should have been filed with
the CA. Section 4 of Rule 65 reads:
Section 4. When and where petition filed. — The petition shall be filed not later
than sixty (60) days from notice of the judgment, order or resolution. In case a
motion for reconsideration or new trial is timely filed, whether such motion is
required or not, the sixty (60) day period shall be counted from notice of the denial
of said motion.
The petition shall be filed in the Supreme Court or, if it relates to the acts or
omissions of a lower court or of a corporation, board, officer or person, in the
Regional Trial Court exercising jurisdiction over the territorial area as defined by
the Supreme Court. It may also be filed in the Court of Appeals whether or not the
same is in aid of its appellate jurisdiction, or in the Sandiganbayan if it is in aid of
its appellate jurisdiction. If it involves the acts or omissions of a quasi-judicial
agency, unless otherwise provided by law or these Rules, the petition shall be filed
in and cognizable only by the Court of Appeals. [Emphases supplied]
That the MB is a quasi-judicial agency was already settled and reiterated in the
case of Bank of Commerce v. Planters Development Bank And Bangko Sentral Ng
Pilipinas.30
Doctrine of Hierarchy of Courts
Even in the absence of such provision, the petition is also dismissible because it
simply ignored the doctrine of hierarchy of courts. True, the Court, the CA and the
RTC have original concurrent jurisdiction to issue writs of certiorari, prohibition and
mandamus. The concurrence of jurisdiction, however, does not grant the party
seeking any of the extraordinary writs the absolute freedom to file a petition in any
court of his choice. The petitioner has not advanced any special or important
reason which would allow a direct resort to this Court. Under the Rules of Court, a
party may directly appeal to this Court only on pure questions of law. 31 In the case
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at bench, there are certainly factual issues as Vivas is questioning the findings of
the investigating team.
Strict observance of the policy of judicial hierarchy demands that where the
issuance of the extraordinary writs is also within the competence of the CA or the
RTC, the special action for the obtainment of such writ must be presented to either
court. As a rule, the Court will not entertain direct resort to it unless the redress
desired cannot be obtained in the appropriate lower courts; or where exceptional
and compelling circumstances, such as cases of national interest and with serious
implications, justify the availment of the extraordinary remedy of writ of certiorari,
prohibition, or mandamus calling for the exercise of its primary jurisdiction.32 The
judicial policy must be observed to prevent an imposition on the precious time and
attention of the Court.
The MB Committed No Grave Abuse of Discretion
In any event, no grave abuse of discretion can be attributed to the MB for the
issuance of the assailed Resolution No. 276.
Vivas insists that the circumstances of the case warrant the application of Section
11 of R.A. No. 7353, which provides:
Sec. 11. The power to supervise the operation of any rural bank by the Monetary
Board as herein indicated shall consist in placing limits to the maximum credit
allowed to any individual borrower; in prescribing the interest rate, in determining
the loan period and loan procedures, in indicating the manner in which technical
assistance shall be extended to rural banks, in imposing a uniform accounting
system and manner of keeping the accounts and records of rural banks; in
instituting periodic surveys of loan and lending procedures, audits, test-check of
cash and other transactions of the rural banks; in conducting training courses for
personnel of rural banks; and, in general, in supervising the business operations of
the rural banks.
The Central Bank shall have the power to enforce the laws, orders, instructions,
rules and regulations promulgated by the Monetary Board, applicable to rural
banks; to require rural banks, their directors, officers and agents to conduct and
manage the affairs of the rural banks in a lawful and orderly manner; and, upon
proof that the rural bank or its Board of Directors, or officers are conducting and
managing the affairs of the bank in a manner contrary to laws, orders, instructions,
rules and regulations promulgated by the Monetary Board or in a manner
substantially prejudicial to the interest of the Government, depositors or creditors,
to take over the management of such bank when specifically authorized to do so
by the Monetary Board after due hearing process until a new board of directors
and officers are elected and qualified without prejudice to the prosecution of the
persons responsible for such violations under the provisions of Sections 32, 33
and 34 of Republic Act No. 265, as amended.
x x x x.
The thrust of Vivas’ argument is that ECBI did not commit any financial fraud and,
hence, its placement under receivership was unwarranted and improper. He
asserts that, instead, the BSP should have taken over the management of ECBI
and extended loans to the financially distrained bank pursuant to Sections 11 and
14 of R.A. No. 7353 because the BSP’s power is limited only to supervision and
management take-over of banks, and not receivership.
Vivas argues that implementation of the questioned resolution was tainted with
arbitrariness and bad faith, stressing that ECBI was placed under receivership
without due and prior hearing, invoking Section 11 of R.A. No. 7353 which states
that the BSP may take over the management of a rural bank after due
hearing.33 He adds that because R.A. No. 7353 is a special law, the same should
prevail over R.A. No. 7653 which is a general law.
The Court has taken this into account, but it appears from all over the records that
ECBI was given every opportunity to be heard and improve on its financial
standing. The records disclose that BSP officials and examiners met with the
representatives of ECBI, including Vivas, and discussed their findings. 34 There
were also reminders that ECBI submit its financial audit reports for the years 2007
and 2008 with a warning that failure to submit them and a written explanation of
such omission shall result in the imposition of a monetary penalty.35 More
importantly, ECBI was heard on its motion for reconsideration. For failure of ECBI
to comply, the MB came out with Resolution No. 1548 denying its request for
reconsideration of Resolution No. 726. Having been heard on its motion for
reconsideration, ECBI cannot claim that it was deprived of its right under the Rural
Bank Act.
Close Now, Hear Later
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At any rate, if circumstances warrant it, the MB may forbid a bank from doing
business and place it under receivership without prior notice and hearing. Section
30 of R.A. No. 7653 provides, viz:
Sec. 30. Proceedings in Receivership and Liquidation. – Whenever, upon report of
the head of the supervising or examining department, the Monetary Board finds
that a bank or quasi-bank:
(a) is unable to pay its liabilities as they become due in the ordinary course
of business: Provided, That this shall not include inability to pay caused by
extraordinary demands induced by financial panic in the banking
community;
(b) has insufficient realizable assets, as determined by the Bangko
Sentral, to meet its liabilities; or
(c) cannot continue in business without involving probable losses to its
depositors or creditors; or
(d) has wilfully violated a cease and desist order under Section 37 that has
become final, involving acts or transactions which amount to fraud or a
dissipation of the assets of the institution; in which cases, the Monetary
Board may summarily and without need for prior hearing forbid the
institution from doing business in the Philippines and designate the
Philippine Deposit Insurance Corporation as receiver of the banking
institution. [Emphases supplied.]
x x x x.
Accordingly, there is no conflict which would call for the application of the doctrine
that a special law should prevail over a general law. It must be emphasized that
R.A .No. 7653 is a later law and under said act, the power of the MB over banks,
including rural banks, was increased and expanded. The Court, in several cases,
upheld the power of the MB to take over banks without need for prior hearing. It is
not necessary inasmuch as the law entrusts to the MB the appreciation and
determination of whether any or all of the statutory grounds for the closure and
receivership of the erring bank are present. The MB, under R.A. No. 7653, has
been invested with more power of closure and placement of a bank under
receivership for insolvency or illiquidity, or because the bank’s continuance in
business would probably result in the loss to depositors or creditors. In the case of
Bangko Sentral Ng Pilipinas Monetary Board v. Hon. Antonio-Valenzuela,36 the
Court reiterated the doctrine of "close now, hear later," stating that it was justified
as a measure for the protection of the public interest. Thus:
The "close now, hear later" doctrine has already been justified as a measure for
the protection of the public interest. Swift action is called for on the part of the BSP
when it finds that a bank is in dire straits. Unless adequate and determined efforts
are taken by the government against distressed and mismanaged banks, public
faith in the banking system is certain to deteriorate to the prejudice of the national
economy itself, not to mention the losses suffered by the bank depositors,
creditors, and stockholders, who all deserve the protection of the
government.37[Emphasis supplied]
In Rural Bank of Buhi, Inc. v. Court of Appeals,38 the Court also wrote that
x x x due process does not necessarily require a prior hearing; a hearing or an
opportunity to be heard may be subsequent to the closure. One can just imagine
the dire consequences of a prior hearing: bank runs would be the order of the day,
resulting in panic and hysteria. In the process, fortunes may be wiped out and
disillusionment will run the gamut of the entire banking community. 39
The doctrine is founded on practical and legal considerations to obviate
unwarranted dissipation of the bank’s assets and as a valid exercise of police
power to protect the depositors, creditors, stockholders, and the general
public.40 Swift, adequate and determined actions must be taken against financially
distressed and mismanaged banks by government agencies lest the public faith in
the banking system deteriorate to the prejudice of the national economy.
Accordingly, the MB can immediately implement its resolution prohibiting a banking
institution to do business in the Philippines and, thereafter, appoint the PDIC as
receiver. The procedure for the involuntary closure of a bank is summary and
expeditious in nature. Such action of the MB shall be final and executory, but may
be later subjected to a judicial scrutiny via a petition for certiorari to be filed by the
stockholders of record of the bank representing a majority of the capital stock.
Obviously, this procedure is designed to protect the interest of all concerned, that
is, the depositors, creditors and stockholders, the bank itself and the general
public. The protection afforded public interest warrants the exercise of a summary
closure.
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In the case at bench, the ISD II submitted its memorandum, dated February 17,
2010, containing the findings noted during the general examination conducted on
ECBI with the cut-off date of September 30, 2009. The memorandum underscored
the inability of ECBI to pay its liabilities as they would fall due in the usual course
of its business, its liabilities being in excess of the assets held. Also, it was noted
that ECBI’s continued banking operation would most probably result in the
incurrence of additional losses to the prejudice of its depositors and creditors. On
top of these, it was found that ECBI had willfully violated the cease-and-desist
order of the MB issued in its June 24, 2009 Resolution, and had disregarded the
BSP rules and directives. For said reasons, the MB was forced to issue the
assailed Resolution No. 276 placing ECBI under receivership. In addition, the MB
stressed that it accorded ECBI ample time and opportunity to address its monetary
problem and to restore and improve its financial health and viability but it failed to
do so.
In light of the circumstances obtaining in this case, the application of the corrective
measures enunciated in Section 30 of R.A. No. 7653 was proper and justified.
Management take-over under Section 11 of R.A. No. 7353 was no longer feasible
considering the financial quagmire that engulfed ECBI showing serious conditions
of insolvency and illiquidity. Besides, placing ECBI under receivership would
effectively put a stop to the further draining of its assets.
No Undue Delegation of Legislative Power
Lastly, the petitioner challenges the constitutionality of Section 30 of R.A. No.
7653, as the legislature granted the MB a broad and unrestrained power to close
and place a financially troubled bank under receivership. He claims that the said
provision was an undue delegation of legislative power. The contention deserves
scant consideration.
Preliminarily, Vivas’ attempt to assail the constitutionality of Section 30 of R.A. No.
7653 constitutes collateral attack on the said provision of law. Nothing is more
settled than the rule that the constitutionality of a statute cannot be collaterally
attacked as constitutionality issues must be pleaded directly and not
collaterally.41 A collateral attack on a presumably valid law is not permissible.
Unless a law or rule is annulled in a direct proceeding, the legal presumption of its
validity stands.42
Be that as it may, there is no violation of the non-delegation of legislative
power.1âwphi1 The rationale for the constitutional proscription is that "legislative
discretion as to the substantive contents of the law cannot be delegated. What can
be delegated is the discretion to determine how the law may be enforced, not what
the law shall be. The ascertainment of the latter subject is a prerogative of the
legislature. This prerogative cannot be abdicated or surrendered by the legislature
to the delegate."43
"There are two accepted tests to determine whether or not there is a valid
delegation of legislative power, viz, the completeness test and the sufficient
standard test. Under the first test, the law must be complete in all its terms and
conditions when it leaves the legislature such that when it reaches the delegate the
only thing he will have to do is enforce it. Under the sufficient standard test, there
must be adequate guidelines or stations in the law to map out the boundaries of
the delegate's authority and prevent the delegation from running riot. Both tests
are intended to prevent a total transference of legislative authority to the delegate,
who is not allowed to step into the shoes of the legislature and exercise a power
essentially legislative."44
In this case, under the two tests, there was no undue delegation of legislative
authority in the issuance of R.A. No. 7653. To address the growing concerns in the
banking industry, the legislature has sufficiently empowered the MB to effectively
monitor and supervise banks and financial institutions and, if circumstances
warrant, to forbid them to do business, to take over their management or to place
them under receivership. The legislature has clearly spelled out the reasonable
parameters of the power entrusted to the MB and assigned to it only the manner of
enforcing said power. In other words, the MB was given a wide discretion and
latitude only as to how the law should be implemented in order to attain its
objective of protecting the interest of the public, the banking industry and the
economy.
WHEREFORE, the petition for prohibition is DENIED.
SO ORDERED.
G.R. No. 186613 August 27, 2013
ROSENDO R. CORALES, IN HIS OFFICIAL CAPACITY AS MUNICIPAL
MAYOR OF NAGCARLAN, LAGUNA, AND DR. RODOLFO R. ANGELES, IN
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HIS OFFICIAL CAPACITY AS MUNICIPAL ADMINISTRATOR OF
NAGCARLAN, LAGUNA, PETITIONERS,
vs.
REPUBLIC OF THE PHILIPPINES, REPRESENTED BY THE COMMISSION ON
AUDIT, AS REPRESENTED BY PROVINCIAL STATE AUDITOR OF LAGUNA
MAXIMO L. ANDAL, RESPONDENT.
DECISION
PEREZ, J.:
This Petition for Review on Certiorari under Rule 45 of the Rules of Court seeks to
nullify the Decision1 and Resolution2 dated 15 September 2008 and 20 February
2009, respectively, of the Court of Appeals in CA-G.R. SP No. 101296 and, in
effect, to reinstate the Petition for Prohibition and Mandamus3 filed by herein
petitioners Rosendo R. Corales (Corales) and Dr. Rodolfo R. Angeles (Dr.
Angeles) with the Regional Trial Court (RTC) of San Pablo City, Laguna. The
assailed Decision annulled and set aside the Order4 dated 17 May 2007 of Branch
32, and the Order5 dated 5 September 2007 of Branch 29, both of the RTC of San
Pablo City, Laguna in Civil Case No. SP-6370 (07), which respectively denied
herein respondent Republic of the Philippines’ (Republic) Motion to Dismiss
petitioners’ Petition for Prohibition and the subsequent Motion for Reconsideration
thereof. The Court of Appeals thereby ordered the dismissal of petitioners’ Petition
for Prohibition with the court a quo. The questioned Resolution, on the other hand,
denied for lack of merit petitioners’ Motion for Reconsideration of the assailed
Decision.
The antecedents, as culled from the records, are as follows:
Petitioner Corales was the duly elected Municipal Mayor of Nagcarlan, Laguna for
three (3) consecutive terms, i.e., the 1998, 2001 and 2004 elections. In his first
term as local chief executive, petitioner Corales appointed petitioner Dr. Angeles to
the position of Municipal Administrator, whose appointment was unanimously
approved by the Sangguniang Bayan of Nagcarlan, Laguna (Sangguniang Bayan)
per Resolution No. 98-646 dated 22 July 1998. During his second and third terms
as municipal mayor, petitioner Corales renewed the appointment of petitioner Dr.
Angeles. But, on these times, the Sangguniang Bayan per Resolution No. 2001-
0787 dated 12 July 2001 and 26 subsequent Resolutions, disapproved petitioner
Dr. Angeles’ appointment on the ground of nepotism, as well as the latter’s
purported unfitness and unsatisfactory performance. Even so, petitioner Dr.
Angeles continued to discharge the functions and duties of a Municipal
Administrator for which he received an annual salary of ₱210,012.00.8
Following an audit on various local disbursements, Maximo Andal (Andal), the
Provincial State Auditor of Laguna, issued an Audit Observation Memorandum
(AOM) No. 2006-007-1009 dated 6 October 2006 addressed to petitioner Corales
who was asked to comment/reply. The aforesaid AOM, in sum, states that: 1)
petitioner Dr. Angeles’ appointment as Municipal Administrator (during the second
and third terms of petitioner Corales) was without legal basis for having been
repeatedly denied confirmation by the Sangguniang Bayan; 2) petitioner Dr.
Angeles can be considered, however, as a de facto officer entitled to the
emoluments of the office for the actual services rendered; 3) nonetheless, it is not
the Municipality of Nagcarlan that should be made liable to pay for petitioner Dr.
Angeles’ salary; instead, it is petitioner Corales, being the appointing authority, as
explicitly provided for in Article 169(I) of the Rules and Regulations Implementing
the Local Government Code of 1991,10 as well as Section 5, Rule IV of the
Omnibus Rules of Appointments and Other Personnel Actions;11 4) a post audit of
payrolls pertaining to the payment of salaries, allowances and other incentives of
petitioner Dr. Angeles from 15 July 2001 up to 31 May 2006 12 partially amounted to
₱1,282,829.99; and 5) in view thereof, it is recommended that an appropriate
Notice of Disallowance be issued for the payment of salary expenses incurred
without legal basis by the Municipality of Nagcarlan in the aforestated amount. 13
Instead of submitting his comment/reply thereon, petitioner Corales, together with
petitioner Dr. Angeles, opted to file a Petition for Prohibition and Mandamus
against Andal and the then members of the Sangguniang Bayan before the RTC of
San Pablo City, Laguna, docketed as Civil Case No. SP-6370 (07) and originally
raffled to Branch 32. Petitioners sought, by way of prohibition, to require the Office
of the Provincial Auditor, through Andal, to recall its AOM and to eventually desist
from collecting reimbursement from petitioner Corales for the salaries paid to and
received by petitioner Dr. Angeles for the latter’s services as Municipal
Administrator. Petitioners similarly sought, by way of mandamus, to compel the
then members of the Sangguniang Bayan, as a collegial body, to recall its
Resolutions denying confirmation to petitioner Dr. Angeles’ appointment as
Municipal Administrator and in their stead to confirm the validity and legitimacy of
such appointment.14
In its turn, the Office of the Solicitor General (OSG), on Andal’s behalf, who was
impleaded in his official capacity, filed a Motion to Dismiss petitioners’ Petition for
Prohibition and Mandamus grounded on lack of cause of action, prematurity and
non-exhaustion of administrative remedies. It was specifically contended therein
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that: (1) the issuance of the AOM was merely an initiatory step in the
administrative investigation of the Commission on Audit (COA) to allow petitioner
Corales to controvert the findings and conclusions of the Sangguniang Bayan in its
Resolution No. 2001-078, as well as those of then Secretary Jose D. Lina, Jr. in
Department of Interior and Local Government (DILG) Opinion No. 124 s. 2002; (2)
it was only after the completion of the said investigation that a resolution will be
issued as regards the propriety of the disbursements made by the Municipality of
Nagcarlan in the form of salaries paid to petitioner Dr. Angeles during his tenure as
Municipal Administrator; and (3) instead of resorting to judicial action, petitioner
Corales should have first responded to the AOM and, in the event of an adverse
decision against him, elevate the matter for review to a higher authorities in the
COA.15 With these, petitioners’ petition should be dismissed, as petitioner Corales
has no cause of action against Andal - his resort to judicial intervention is
premature and he even failed to avail himself of, much less exhaust, the
administrative remedies available to him.16
In its Order dated 17 May 2007, the trial court denied the said Motion to Dismiss
on the ground that Andal was merely a nominal party.17 The subsequent motion for
its reconsideration was also denied in another Order dated 5 September 2007. 18
Respondent Republic, as represented by COA, as represented by Andal,
consequently filed a Petition for Certiorari with the Court of Appeals ascribing
grave abuse of discretion amounting to lack or excess of jurisdiction on the part of
the trial court in rendering the Orders dated 17 May 2007 and 5 September 2007,
as it unjustly denied respondent’s right to actively prosecute the case through a
mere declaration that it was a nominal party despite a clear showing that the
Petition for Prohibition referred to the respondent as a real party in interest. 19
On 15 September 2008, the Court of Appeals rendered its now assailed Decision
granting respondent’s Petition for Certiorari, thereby annulling and setting aside
the RTC Orders dated 17 May 2007 and 5 September 2007 and, accordingly,
dismissing petitioners’ Petition for Prohibition with the court a quo. 20 The Court of
Appeals justified its decision in the following manner:
x x x We agree with the OSG’s contention that the [herein respondent Republic],
herein represented by the COA and specifically by Andal in the latter’s capacity as
Provincial State Auditor of Laguna, is not merely a nominal party to the petition for
prohibition. x x x. That the [respondent] naturally has an interest in the
disposition/disbursement of said public funds as well as in the recovery thereof
should the ongoing investigative audit confirm the illegality thereof cannot be
gainsaid. Rather than a mere nominal party, therefore, the [respondent] is an
indispensable party to the petition for prohibition and may thus seek its dismissal,
given that under the attendant facts there is a yet no actual case or controversy
calling for [therein] respondent court’s exercise of its judicial power.
Judicial review cannot be exercised in vacuo. Thus, as a condition precedent for
the exercise of judicial inquiry, there must be an actual case or controversy, which
exists when there is a conflict of legal rights or an assertion of opposite legal
claims, which can be resolved on the basis of existing law and jurisprudence. x x x.
An actual case or controversy thus means an existing case or controversy that is
appropriate or ripe for judicial determination, not conjectural or anticipatory, lest the
decision of the court would amount to an advisory opinion.
[Herein petitioners] x x x have failed to show the existence of an actual case or
controversy that would necessitate judicial inquiry through a petition for prohibition.
As the OSG aptly observed, the issuance of the AOM is just an initiatory step in
the investigative audit being then conducted by Andal[,] as Provincial State Auditor
of Laguna to determine the propriety of the disbursements made by the Municipal
Government of Nagcarlan. While Andal may have stated an opinion in the AOM
that [herein petitioner] Corales should reimburse the government treasury for the
salaries paid to [herein petitioner Dr. Angeles] in light of the repeated disapproval
and/or rejection of the latter’s appointment by the Sangguniang [Bayan] of
Nagcarlan, there is no showing whatsoever of any affirmative action taken by
Andal to enforce such audit observation. What Andal did, as the AOM
unmistakably shows, was to merely request [petitioner] Corales to submit a
reply/comment to the audit observation and in the process afford the latter an
opportunity to controvert not only Andal’s opinion on salary reimbursement but the
other statements therein expressed by the other members of the audit team.
In the absence moreover of a showing that [petitioners], particularly [petitioner]
Corales, sustained actual or imminent injury by reason of the issuance of the AOM,
there is no reason to allow the continuance of the petition for prohibition which
was, after all, manifestly conjectural or anticipatory, filed for a speculative purpose
and upon the hypothetical assumption that [petitioner] Corales would be eventually
compelled to reimburse the amounts paid as [petitioner Dr. Angeles’] salaries
should the audit investigation confirm the irregularity of such disbursements. This
Court will not engage in such speculative guesswork and neither should
respondent court x x x.21 (Emphasis and italics supplied).
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Disgruntled, petitioners moved for its reconsideration but it was denied for lack of
merit in a Resolution dated 20 February 2009.
Hence, this petition.
In their Memorandum, petitioners raise the following issues:
I.
WHETHER OR NOT THE COURT OF APPEALS COMMITTED A PALPABLY
ERRONEOUS RESOLUTION OF A SUBSTANTIAL QUESTION OF LAW WHEN
IT ORDERED THE DISMISSAL OF PETITIONERS’ SUIT FOR PROHIBITION.
II.
WHETHER OR NOT THE COURT OF APPEALS ACTED UNJUSTLY AND
INJUDICIOUSLY WHEN IT HELD THAT THE FACTS AND CIRCUMSTANCES
SURROUNDING THE SUIT FOR PROHIBITION IS NOT YET RIPE FOR
JUDICIAL DETERMINATION.
III.
WHETHER OR NOT THE COURT OF APPEALS COMMITTED GRAVE AND
REVERSIBLE ERROR IN THE INTERPRETATION AND RESOLUTION OF A
PIVOTAL LEGAL ISSUE WHEN IT CONCLUDED THAT THERE IS NO ACTUAL
DISPUTE OR CONCRETE CONTROVERSY WHICH MAY BE THE PROPER
SUBJECT MATTER OF A SUIT FOR PROHIBITION.
IV.
WHETHER OR NOT THE COURT OF APPEALS UNJUSTIFIABLY
TRANSGRESSED AND TRAMPLED UPON A CATEGORICAL
JURISPRUDENTIAL DOCTRINE WHEN IT TOOK COGNIZANCE OF AND
FAVORABLY RESOLVED THE [HEREIN RESPONDENT’S] PETITION FOR
CERTIORARI, IN BLATANT VIOLATION OF THE RULE LAID DOWN IN THE
APROPOS CASE OF CHINA ROAD AND BRIDGE CORPORATION [V.] COURT
OF APPEALS (348 SCRA 401).
V.
WHETHER OR NOT THE COURT OF APPEALS OVERSTEPPED AND WENT
BEYOND THE BOUNDARIES OF ITS LEGITIMATE DISCRETION WHEN IT
DEVIATED AND VEERED AWAY FROM THE PRINCIPAL ISSUES OF THE
CASE, INSTEAD OF PRONOUNCING THAT PETITIONERS HAVE A VALID,
PERFECT AND LEGITIMATE CAUSE OF ACTION FOR PROHIBITION.22 (Italics
supplied).
The Petition is bereft of merit.
The issues will be discussed in seriatim.
The first three issues concern the ripeness or prematurity of the Petition for
Prohibition assailing the AOM issued by Andal to petitioner Corales. Petitioners
argue that from the tenor of the AOM it is clear that petitioner Corales is being
adjudged liable and personally accountable to pay or to reimburse, in his private
capacity, the salaries paid to and received by petitioner Dr. Angeles for the latter’s
services as Municipal Administrator, as his appointment thereto was considered
invalid for lack of necessary confirmation from the Sangguniang Bayan. It is further
argued that contrary to the claim of respondent Republic that such AOM is a mere
initiatory step in the course of an investigative auditing process, the wordings
thereof unmistakably reveal that the same is a categorical disposition and
enforcement measure requiring petitioner Corales to reimburse the money
disbursed by the Municipality of Nagcarlan to pay petitioner Dr. Angeles’ salaries
as Municipal Administrator. Such AOM is a firm, clear and affirmative official action
on the part of the Provincial State Auditor to hold petitioner Corales liable for
reimbursement; thus, to require the latter to still comment or controvert the findings
thereon is a mere frivolous and useless formality. Since the requirement for
petitioner Corales to pay and reimburse the salaries of petitioner Dr. Angeles is
actual, direct and forthcoming, the same may be the proper subject of an action for
prohibition. Otherwise stated, such imposition of liability for reimbursement against
petitioner Corales presents a concrete justiciable controversy and an actual
dispute of legal rights.
Petitioners’ contention is unavailing.
To begin with, this Court deems it proper to quote the significant portions of the
questioned AOM, to wit:
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 FOR : Hon. ROSENDO R. CORALES
Municipal Mayor
Nagcarlan, Laguna
FROM : Mr. MAXIMO L. ANDAL
State Auditor IV
Audit Team Leader
May we have your comment/reply on the following audit observation. Please return As held in one case (Civil Liberties Union [v.]
the duplicate within fifteen (15) days upon receipt by filling up the space provided Executive Secretary, 194 SCRA 317), a de facto
for with your comments.
AUDIT OBSERVATION
The appointment of [herein petitioner Dr.
Angeles] as Municipal Administrator was
repeatedly denied not confirmed/ concurred
by Sangguniang Bayan hence, the validity of
the appointment as per opinion/rulings by
the then Secretary Jose D. Lina, Jr. of the
DILG in opinion No. 124 s.2002 was without
legal basis.
DILG Opinion No. 124 s[.]2002 states that the
continued discharge of powers by [petitioner Dr.
Angeles] as Municipal Administrator appears to
have no legal basis. A person may assume
public office once his appointment is already
effective. The Supreme Court in one case (Atty.
David B. Corpuz [v.] Court of Appeals, et al[.],
G.R. No. 123989, 26 January 1998) held that
where the assent or confirmation of some other
office or body is required, the appointment may
be complete only when such assent or
confirmation is obtained. Until the process is
completed, the appointee can claim no vested
right in the office nor invoke security of tenure.
Since the appointment of a Municipal
Administrator requires sanggunian concurrence
(Section 443 (d), RA 7160) and considering that
the appointment never became effective. As
such, his assumption and continued holding of
the office of the Municipal Administrator find no
legal basis.
However, [petitioner Dr. Angeles] may claim
salary for the services he has actually rendered.
officer is entitled to emoluments of the office for
the actual services rendered. Here, [petitioner
Dr. Angeles] can be considered as a de facto
MANAGEMENT COMMENT officer. x x x, as held in the Corpuz case cited
above, the Supreme Court ruled that a public
official who assumed office under an incomplete
appointment is merely a de facto officer for the
duration of his occupancy of the office for the
reason that he assumed office under color of a
known appointment which is void by a reason of
some defect or irregularity in its exercise.
It is worthy to emphasize along that line that
while [petitioner Dr. Angeles] may be entitled to
the salary as a de facto officer, the municipality
cannot be made liable to pay his salaries.
Instructive on this point is Article 169 (I) of the
Rules and Regulations Implementing the Local
Government Code of 1991 which explicitly
provides, thus:
"The appointing authority shall be liable for the
payment of salary of the appointee for actual
services rendered if the appointment is
disapproved because the appointing authority
issued it in willful violation of applicable laws,
rules and regulations thereby making the
appointment unlawful."
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Corollary, Section 5 of Rule IV of the Omnibus
Rules of Appointments and Other Personnel
Actions provides, thus:
"The services rendered by any person who was
required to assume the duties and
responsibilities of any position without
appointment having been issued by the
appointing authority shall not be credited nor
recognized by the Commission and shall be the
personal accountability of the person who made
him assume office.
Hence, [herein petitioner Corales] shall pay the
salaries of [petitioner Dr. Angeles] for the
services the latter has actually rendered.
xxx xxx xxx
Clearly, the appointment of [petitioner Dr.
Angeles] per se was bereft of legal basis in view
of the absence of the concurrence of the
legislative body thus payment of his salaries
from the funds of the Municipality for actual
services rendered remained unlawful.
Further, in paragraph 4 of the letter of Mr. Allan
Poe M. Carmona, Director II of the CSC dated [1
December 2004] to Mr. Ruben C. Pagaspas,
OIC, Regional Cluster Director, COA, Cluster III,
Sub-Cluster VI stated that [petitioner Dr.
Angeles] cannot be appointed to Municipal
Administrator without the concurrence of the
Sangguniang Bayan as provided under RA
7160.
Post audit of payrolls pertaining to the payment
of salaries, allowances and other incentives of
[petitioner Dr. Angeles] as Municipal
Administrator for the period from [15 July 2001]
up to [31 May 2006] excluding the period from [1
November 2001] to [31 December 2001], [16
March 2002] to [15 May 2002], [1-31 August
2002], [16-30 June 2003], [1-31 December
2003], [1-31 September 2004] and [1 June 2006]
to [30 September 2006] were partially amounted
to ₱1,282,829.99. x x x.
Issuance of Notice of Disallowance was
suggested by Atty. Eden T. Rafanan, Regional
Cluster Director for [L]egal and Adjudication
Office in her 2nd Indorsement dated [3 July
2006].
In view hereof, it is recommended that
appropriate Notice of Disallowance be issued for
the payment of the salary expenses incurred
without legal basis by the municipality in the
amount mentioned in the above
paragraph.23 (Emphasis, italics and
underscoring supplied).
As can be gleaned therefrom, petitioner Corales was simply required to submit his
comment/reply on the observations stated in the AOM. As so keenly observed by
the Court of Appeals, any mention in the AOM that petitioner Corales shall
reimburse the salaries paid to petitioner Dr. Angeles in light of the repeated
disapproval or rejection by the Sangguniang Bayan of his appointment as
Municipal Administrator was merely an initial opinion, not conclusive, as there was
no showing that Andal had taken any affirmative action thereafter to compel
petitioner Corales to make the necessary reimbursement. Otherwise stated, it has
not been shown that Andal carried out or enforced what was stated in the AOM.
On the contrary, petitioner Corales was given an opportunity to refute the findings
and observations in the AOM by requesting him to comment/reply thereto, but he
never did. More so, even though the AOM already contained a recommendation
for the issuance of a Notice of Disallowance of the payment of salary expenses,
the records are bereft of any evidence to show that a Notice of Disallowance has,
in fact, been issued. Concomitantly, the AOM did not contain any recommendation
to the effect that petitioner Corales would be held personally liable for the amount
that would be disallowed. It is, therefore, incongruous to conclude that the said
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AOM is tantamount to a directive requiring petitioner Corales to reimburse the
salaries paid to and received by petitioner Dr. Angeles during the latter’s stint as
Municipal Administrator after his appointment thereto was held invalid for want of
conformity from the Sangguniang Bayan.
In relation thereto, as aptly observed by the OSG, to which the Court of Appeals
conformed, the issuance of the AOM is just an initiatory step in the investigative
audit being conducted by Andal as Provincial State Auditor to determine the
propriety of the disbursements made by the Municipal Government of Laguna.
That the issuance of an AOM can be regarded as just an initiatory step in the
investigative audit is evident from COA Memorandum No. 2002-053 dated 26
August 2002.24 A perusal of COA Memorandum No. 2002-053, particularly Roman
Numeral III, Letter A, paragraphs 1 to 5 and 9, reveals that any finding or
observation by the Auditor stated in the AOM is not yet conclusive, as the
comment/justification25 of the head of office or his duly authorized representative is
still necessary before the Auditor can make any conclusion. The Auditor may give
due course or find the comment/justification to be without merit but in either case,
the Auditor shall clearly state the reason for the conclusion reached and
recommendation made. Subsequent thereto, the Auditor shall transmit the AOM,
together with the comment or justification of the Auditee and the former’s
recommendation to the Director, Legal and Adjudication Office (DLAO), for the
sector concerned in Metro Manila and/or the Regional Legal and Adjudication
Cluster Director (RLACD) in the case of regions. The transmittal shall be coursed
through the Cluster Director concerned and the Regional Cluster Director, as the
case may be, for their own comment and recommendation. The DLAO for the
sector concerned in the Central Office and the RLACD shall make the necessary
evaluation of the records transmitted with the AOM. When, on the basis thereof, he
finds that the transaction should be suspended or disallowed, he will then issue the
corresponding Notice of Suspension (NS), Notice of Disallowance (ND) or Notice
of Charge (NC), as the case may be, furnishing a copy thereof to the Cluster
Director. Otherwise, the Director may dispatch a team to conduct further
investigation work to justify the contemplated action. If after in-depth investigation,
the DLAO for each sector in Metro Manila and the RLACD for the regions find that
the issuance of the NS, ND, and NC is warranted, he shall issue the same and
transmit such NS, ND or NC, as the case may be, to the agency head and other
persons found liable therefor.
From the foregoing, it is beyond doubt that the issuance of an AOM is, indeed, an
initial step in the conduct of an investigative audit considering that after its
issuance there are still several steps to be conducted before a final conclusion can
be made or before the proper action can be had against the Auditee. There is,
therefore, no basis for petitioner Corales’ claim that his comment thereon would be
a mere formality. Further, even though the AOM issued to petitioner Corales
already contained a recommendation for the issuance of a Notice of Disallowance,
still, it cannot be argued that his comment/reply to the AOM would be a futile act
since no Notice of Disallowance was yet issued. Again, the records are bereft of
any evidence showing that Andal has already taken any affirmative action against
petitioner Corales after the issuance of the AOM.
Viewed in this light, this Court can hardly see any actual case or controversy to
warrant the exercise of its power of judicial review. Settled is the rule that for the
courts to exercise the power of judicial review, the following must be extant: (1)
there must be an actual case calling for the exercise of judicial power; (2) the
question must be ripe for adjudication; and (3) the person challenging must have
the "standing." An actual case or controversy involves a conflict of legal rights, an
assertion of opposite legal claims, susceptible of judicial resolution as
distinguished from a mere hypothetical or abstract difference or dispute. There
must be a contrariety of legal rights that can be interpreted and enforced on the
basis of existing law and jurisprudence. Closely related thereto is that the question
must be ripe for adjudication. A question is considered ripe for adjudication when
the act being challenged has had a direct adverse effect on the individual
challenging it. The third requisite is legal standing or locus standi, which has been
defined as a personal or substantial interest in the case such that the party has
sustained or will sustain direct injury as a result of the governmental act that is
being challenged, alleging more than a generalized grievance. The gist of the
question of standing is whether a party alleges "such personal stake in the
outcome of the controversy as to assure that concrete adverseness which
sharpens the presentation of issues upon which the court depends for illumination
of difficult constitutional questions." Unless a person is injuriously affected in any of
his constitutional rights by the operation of statute or ordinance, he has no
standing.26
The requisites of actual case and ripeness are absent in the present case. To
repeat, the AOM issued by Andal merely requested petitioner Corales to
comment/reply thereto.1awp++i1 Truly, the AOM already contained a
recommendation to issue a Notice of Disallowance; however, no Notice of
Disallowance was yet issued. More so, there was no evidence to show that Andal
had already enforced against petitioner Corales the contents of the AOM. Similarly,
there was no clear showing that petitioners, particularly petitioner Corales, would
sustain actual or imminent injury by reason of the issuance of the AOM. The action
taken by the petitioners to assail the AOM was, indeed, premature and based
entirely on surmises, conjectures and speculations that petitioner Corales would
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eventually be compelled to reimburse petitioner Dr. Angeles’ salaries, should the
audit investigation confirm the irregularity of such disbursements. Further, as
correctly pointed out by respondent Republic in its Memorandum, what petitioners
actually assail is Andal’s authority to request them to file the desired
comment/reply to the AOM, which is beyond the scope of the action for prohibition,
as such request is neither an actionable wrong nor constitutive of an act perceived
to be illegal. Andal, being the Provincial State Auditor, is clothed with the authority
to audit petitioners’ disbursements, conduct an investigation thereon and render a
final finding and recommendation thereafter. Hence, it is beyond question that in
relation to his audit investigation function, Andal can validly and legally require
petitioners to submit comment/reply to the AOM, which the latter cannot pre-empt
by prematurely seeking judicial intervention, like filing an action for prohibition.
Moreover, prohibition, being a preventive remedy to seek a judgment ordering the
defendant to desist from continuing with the commission of an act perceived to be
illegal, may only be resorted to when there is "no appeal or any other plain,
speedy, and adequate remedy in the ordinary course of law." 27
In this case, petitioners insist that it is no longer necessary to exhaust
administrative remedies considering that there is no appeal or any other plain,
speedy and appropriate remedial measure to assail the imposition under the AOM
aside from an action for prohibition.
This Court finds the said contention plain self-deception.
As previously stated, petitioners’ action for prohibition was premature. The audit
investigative process was still in its initial phase. There was yet no Notice of
Disallowance issued. And, even granting that the AOM issued to petitioner Corales
is already equivalent to an order, decision or resolution of the Auditor or that such
AOM is already tantamount to a directive for petitioner Corales to reimburse the
salaries paid to petitioner Dr. Angeles, still, the action for prohibition is premature
since there are still many administrative remedies available to petitioners to
contest the said AOM. Section 1, Rule V of the 1997 Revised Rules of Procedure
of the COA, provides: "[a]n aggrieved party may appeal from an order or decision
or ruling rendered by the Auditor embodied in a report, memorandum, letter, notice
of disallowances and charges, Certificate of Settlement and Balances, to the
Director who has jurisdiction over the agency under audit." From the final order or
decision of the Director, an aggrieved party may appeal to the Commission
proper.28 It is the decision or resolution of the Commission proper which can be
appealed to this Court.29
Clearly, petitioners have all the remedies available to them at the administrative
level but they failed to exhaust the same and instead, immediately sought judicial
intervention. Otherwise stated, the auditing process has just begun but the
petitioners already thwarted the same by immediately filing a Petition for
Prohibition. In Fua, Jr. v. COA,30citing Sison v. Tablang,31 this Court declared that
the general rule is that before a party may seek the intervention of the court, he
should first avail himself of all the means afforded him by administrative processes.
The issues which administrative agencies are authorized to decide should not be
summarily taken from them and submitted to the court without first giving such
administrative agency the opportunity to dispose of the same after due
deliberation. Also, in The Special Audit Team, Commission on Audit v. Court of
Appeals and Government Service Insurance System,32 this Court has extensively
pronounced that:
If resort to a remedy within the administrative machinery can still be made by
giving the administrative officer concerned every opportunity to decide on a matter
that comes within his or her jurisdiction, then such remedy should be exhausted
first before the court’s judicial power can be sought. The premature invocation of
the intervention of the court is fatal to one’s cause of action. The doctrine of
exhaustion of administrative remedies is based on practical and legal reasons. The
availment of administrative remedy entails lesser expenses and provides for a
speedier disposition of controversies. Furthermore, the courts of justice, for
reasons of comity and convenience, will shy away from a dispute until the system
of administrative redress has been completed and complied with, so as to give the
administrative agency concerned every opportunity to correct its error and dispose
of the case. x x x.
Moreover, courts have accorded respect for the specialized ability of other
agencies of government to deal with the issues within their respective
specializations prior to any court intervention. The Court has reasoned thus:
We have consistently declared that the doctrine of exhaustion of administrative
remedies is a cornerstone of our judicial system. The thrust of the rule is that
courts must allow administrative agencies to carry out their functions and
discharge their responsibilities within the specialized areas of their respective
competence. The rationale for this doctrine is obvious. It entails lesser expenses
and provides for the speedier resolution of controversies. Comity and convenience
also impel courts of justice to shy away from a dispute until the system of
administrative redress has been completed.
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The 1987 Constitution created the constitutional commissions as independent
constitutional bodies, tasked with specific roles in the system of governance that
require expertise in certain fields. For COA, this role involves:
The power, authority, and duty to examine, audit, and settle all accounts pertaining
to the revenue and receipts of, and expenditures or uses of funds and property,
owned or held in trust by, or pertaining to, the Government, or any of its
subdivisions, agencies, instrumentalities, including government-owned and
controlled corporations with original charter. x x x.
As one of the three (3) independent constitutional commissions, COA has been
empowered to define the scope of its audit and examination and to establish the
techniques and methods required therefor; and to promulgate accounting and
auditing rules and regulations, including those for the prevention and disallowance
of irregular, unnecessary, excessive, extravagant or unconscionable expenditures
or uses of government funds and properties.
Thus, in the light of this constitutionally delegated task, the courts must exercise
caution when intervening with disputes involving these independent bodies, for the
general rule is that before a party may seek the intervention of the court, he should
first avail of all the means afforded him by administrative processes. The issues
which administrative agencies are authorized to decide should not be summarily
taken from them and submitted to a court without first giving such administrative
agency the opportunity to dispose of the same after due deliberation.33(Emphasis
supplied).
In their futile attempt to convince this Court to rule in their favor, petitioners aver
that by filing a Motion to Dismiss on the ground of lack of cause of action,
respondent Republic, in essence, admitted all the material averments and
narration of facts stated in the Petition for Prohibition and Mandamus. As such,
there is no longer any question of fact to speak of and what remains is a pure
question of law. The judgment, therefore, of the trial court denying the Motion to
Dismiss is no longer subject to any appeal or review by the Court of Appeals.
Instead, it is already appealable and reviewable by this Court under Rule 45 of the
Rules of Court, where only pure questions of law may be raised and dealt with.
This is in line with the pronouncement in China Road and Bridge Corporation v.
Court of Appeals34 (China Road Case). The Court of Appeals should have
dismissed respondent Republic’s Petition for Certiorari under Rule 65 of the Rules
of Court for being an improper and inappropriate mode of review.
Petitioners’ above argument is misplaced.
China Road Case is not at all applicable in the case at bench. Therein, the Motion
to Dismiss the Complaint was granted. As the order granting the motion to dismiss
was a final, as distinguished from an interlocutory order, the proper remedy was an
appeal in due course.35 Thus, this Court in China Road Case held that:
x x x Applying the test to the instant case, it is clear that private respondent raises
pure questions of law which are not proper in an ordinary appeal under Rule 41,
but should be raised by way of a petition for review on certiorari under Rule
45.1âwphi1
We agree with private respondent that in a motion to dismiss due to failure to state
a cause of action, the trial court can consider all the pleadings filed, including
annexes, motions and the evidence on record. However in so doing, the trial court
does not rule on the truth or falsity of such documents. It merely includes such
documents in the hypothetical admission. Any review of a finding of lack of cause
of action based on these documents would not involve a calibration of the
probative value of such pieces of evidence but would only limit itself to the inquiry
of whether the law was properly applied given the facts and these supporting
documents. Therefore, what would inevitably arise from such a review are pure
questions of law, and not questions of fact.36 (Emphasis supplied).
In the case at bench, however, the Motion to Dismiss was denied. It is well-
entrenched that an order denying a motion to dismiss is an interlocutory order
which neither terminates nor finally disposes of a case as it leaves something to be
done by the court before the case is finally decided on the merits. 37 Therefore,
contrary to the claim of petitioners, the denial of a Motion to Dismiss is not
appealable, not even via Rule 45 of the Rules of Court. The only remedy for the
denial of the Motion to Dismiss is a special civil action for certiorari showing that
such denial was made with grave abuse of discretion.38
Taking into consideration all the foregoing, this Court finds no reversible error on
the part of the Court of Appeals in reversing the Orders of the court a quo and
consequently dismissing petitioners’ Petition for Prohibition filed thereat.1âwphi1
WHEREFORE, premises considered, the Decision and Resolution dated 15
September 2008 and 20 February 2009, respectively, of the Court of Appeals in
CA-G.R. SP No. 101296 are hereby AFFIRMED. Costs against petitioners.
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SO ORDERED.
G.R. No. 164966 June 8, 2007
ROLANDO TAN, ELENA TAN and LAMBERTO TAN, petitioners,
vs.
THE HONORABLE COURT OF APPEALS, HON. HERMES B. MONTERO, in his
capacity as Assistant Provincial Prosecutor, and the PEOPLE OF THE
PHILIPPINES, respondents.
DECISION
YNARES-SANTIAGO, J.:
This is a petition for review on certiorari assailing the November 24, 2003
Decision1 of the Court of Appeals in CA-G.R. SP No. 74450 dismissing the petition
for prohibition and injunction, which sought to enjoin the Presiding Judge of the
Regional Trial Court of Cebu City, Branch 5, from further proceeding with Crim.
Case Nos. 64381, 64383, 64385, 64386 and 64387; and the July 14, 2004
Resolution2 denying petitioners’ motion for reconsideration.
In a Letter-Complaint dated June 26, 2002, James L. King (King) charged Roderick
Lim-Go, Lucy Go, Nelson Go, John Doe and Peter Doe with violation of Batas
Pambansa Bilang 22 (B.P. 22) and Estafa involving two checks both dated June
21, 2002, to wit: (1) United Overseas Bank Philippines (UOB) Check No.
00082597 in the amount of ₱20 Million; and (2) UOB Check No. 00082599 in the
amount of ₱7.9 Million.
Subsequently or on July 10, 2002, King filed a Supplemental Complaint-Affidavit
involving five additional checks, to wit: (1) UOB Check No. 0000082596 dated
June 21, 2002 in the amount of ₱7 Million; (2) UOB Check No. 0000082598 dated
June 21, 2002 in the amount of ₱26.68 Million; (3) UOB Check No. 0000082434
dated June 23, 2002 in the amount of ₱2.6 Million; (4) UOB Check No.
0000082495 dated June 24, 2002 in the amount of ₱7 Million; and (5) UOB Check
No. 0000082494 dated June 24, 2002 in the amount of ₱18 Million. The
complaints were docketed as I.S. Nos. 02-5997-5999-F, 02-0827-B, 02-0827-C,
02-0827-D, 02-0827-E and 02-0827-F, respectively.
On August 1, 2002, King filed a Second Supplemental Complaint-Affidavit for
Estafa impleading Grace Tan-Go, and herein petitioners Rolando Tan, Elena Tan,
and Lamberto Tan, as additional respondents.
King averred that in February 2002, the spouses Roderick Lim Go and Grace Tan-
Go (spouses Go) proposed to him a business transaction wherein the spouses Go
would borrow cash from King in exchange for which Roderick Go would issue
postdated checks corresponding to the amount borrowed plus interest. Roderick
Go’s parents, Go Tong Go and Lucy Go, and brother, Nelson Go, assured King
that whatever checks Roderick Go would issue would be funded on their due dates
and that the checking account at the United Overseas Bank, Carbon Branch, Cebu
City is their joint account. King agreed to the business proposal. Thereafter,
Roderick Go started issuing checks, inclusive of interest, in exchange for the cash
given by King. The checks when presented for encashment were initially honored
by the drawee bank; consequently, King reposed his trust and confidence in
spouses Go.
On March 22, 2002, the spouses Go, together with herein petitioners Rolando Tan
(father of Grace Tan-Go), Elena Tan (mother of Grace Tan-Go), asked ₱100
Million from King allegedly for the renovation of their movie houses in Butuan City.
However, King could only accommodate ₱40 Million, in exchange for which,
Roderick Go issued several checks to King in the amount of ₱61.28 Million,
inclusive of the interest for three months.
At first, the checks issued by Go were honored by the drawee bank when
presented. However, on June 24, 2002, when several of the checks he issued
were about to fall due, Roderick Go requested King for a meeting. While at the
agreed meeting place, Roderick Go allegedly attacked King with a box cutter and
told him that all the checks that he issued would be dishonored and for this reason
he had to injure, kidnap and kill him. This incident is the subject of a separate
criminal case. Thereafter, all the checks dated June 21, 23 and 24, 2002 issued by
Roderick Go were dishonored for having been drawn against insufficient funds.
Despite repeated demands, no payment was made; hence, King filed a complaint
for violation of BP Blg. 22 and Estafa.
All the accused, except Roderick Go, submitted their counter-affidavits. In their
Joint Counter-Affidavit3 dated August 8, 2002, petitioners denied meeting King on
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March 22, 2002; that only Roderick Go could be held liable for the bouncing
checks considering that he alone issued the same; that King’s first supplemental
complaint-affidavit contradicted his second supplemental complaint-affidavit. In the
first supplemental complaint-affidavit, Roderick Go, Lucy Go, Nelson Go, John Doe
and Peter Doe were made respondents as co-conspirators relative to the issuance
of the bouncing checks, while in the second supplemental complaint-affidavit,
petitioners were made co-conspirators over the same checks but under totally
different circumstances. Thus, petitioners claim that the criminal cases filed against
them were an afterthought and prayed that the same be dismissed.
The preliminary investigation of the subject criminal cases was initially assigned to
1st Assistant Provincial Prosecutor/Officer-in-Charge Cesar Tajanlangit who
voluntarily inhibited himself. On October 10, 2002, then Secretary of Justice
Hernando B. Perez issued Department Order (D.O.) No. 369,4 designating public
respondent 3rd Assistant Provincial Prosecutor Hermes Montero (Montero) to
continue with the preliminary investigation of these cases, and, if the evidence
warranted, to file the appropriate informations in court.
In a Joint Resolution5 dated November 8, 2002, public respondent Montero found
probable cause for the following crimes:
WHEREFORE, in the light of the foregoing, the following criminal Informations
shall be filed against:
(1) Roderick L. Go, alias ‘Edu Ting’, for violation of B.P. 22 on seven (7) counts;
(2) Roderick L. Go, Grace Tan-Go, Go Tong Go, Lucy Go and Nelson Go, for
estafa on two (2) counts anent (a) UOB Check No. 00082597 dated June 21, 2002
in the amount of ₱20,000,000.00; and (b) UOB Check No. 00082599 dated June
21, 2002 in the amount of ₱7,800,000.00;
(3) Roderick L. Go, Grace Tan-Go, Go Tong Go, Lucy Go, Nelson Go, [petitioners]
Rolando Tan, Elena Tan and Lamberto Tan, for estafa on five (5) counts anent (c)
UOB Check No. 0000082596 dated June 21, 2002, in the amount of
₱7,000,000.00, (d) UOB Check No. 0000082598 dated June 21, 2002, in the
amount of ₱26,680,000.00, (e) UOB Check No. 0000082434 dated June 23, 2002,
in the amount of ₱2,600,000.00, (f) UOB Check No. 0000082495 dated June 24,
2002, in the amount of ₱7,000,000.00, and (g) UOB Check No. 0000082494 dated
June 24, 2002, in the amount of ₱18,000,000.00.6
On November 11, 2002, five informations for estafa under Article 315, 2(a) of the
Revised Penal Code were filed against Roderick L. Go, Grace Tan-Go, Go Tong
Go, Lucy Go, Nelson Go, and herein petitioners, docketed as Criminal Case Nos.
CBU- 64381, 64383, 64385, 64386, and 64387 and raffled to the Regional Trial
Court, Branch 5 of Cebu City. From the above-quoted adverse Resolution of public
respondent Montero, only Roderick Go and Grace Tan-Go separately appealed to
the Secretary of Justice.
On November 18, 2002, before any warrant of arrest could be issued, petitioners
posted bail. The following day or on November 19, 2002, they were arraigned and
pleaded not guilty.
On December 17, 2002, petitioners filed a Petition for Prohibition and Injunction
with Preliminary Injunction and Prayer for Temporary Restraining Order 7 before the
Court of Appeals. They sought to restrain the trial court from proceeding with the
subject criminal cases against them and prayed that the same be dismissed.
On November 24, 2003, the Court of Appeals issued the assailed Decision
dismissing the petition for lack of merit. It found that (1) petitioners failed to avail
themselves of other plain, speedy and adequate remedies to challenge the public
prosecutor’s finding of probable cause; (2) the petition failed to establish that it falls
under any of the exceptions to the general rule that the court will not issue writs of
prohibition or injunction, preliminary or final, to enjoin or restrain a criminal
prosecution; (3) public respondent Montero was duly authorized by the Secretary
of Justice to conduct the preliminary investigation and, if the evidence so
warranted, to file the corresponding informations relative to the subject criminal
cases; (4) petitioners failed to prove that public respondents acted with grave
abuse of discretion; and (5) petitioners’ claims contesting the public prosecutor’s
finding of probable cause are matters of defense that should be threshed out
during the trial of the criminal cases and not through the extraordinary remedy of
prohibition.
After their motion for reconsideration was denied, petitioners interposed the instant
petition raising nine issues8revolving around the factual and legal bases of the
finding of probable cause for estafa against them as well as the authority of public
respondent Montero to file the subject criminal cases with the trial court.
At the outset, it must be stressed that petitioners are asking us to review the
Decision of the Court of Appeals which dismissed their petition for prohibition.
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Therefore, the principal issue is whether resort to the extraordinary remedy of
prohibition was proper.
We rule in the negative.
Basic is the rule that the writ of prohibition is an extraordinary remedy to prevent
the unlawful and oppressive exercise of legal authority and to provide for a fair and
orderly administration of justice.9 It is available only when there is no appeal or any
plain, speedy and adequate remedy in the ordinary course of law, and when the
proceedings are done without or in excess of jurisdiction or with grave abuse of
discretion. The petitioner must allege in his petition and establish facts to show that
any other existing remedy is not speedy or adequate.10 A remedy is plain, speedy
and adequate if it will promptly relieve the petitioner from the injurious effects of
that judgment and the acts of the tribunal or inferior court.11 Further, the writ will
not lie to correct errors of judgment but only errors of jurisdiction. As long as the
tribunal acts within its jurisdiction, any alleged errors committed in the exercise of
its discretion will amount to nothing more than mere errors of judgment which are
correctible by a timely appeal.12 In determining whether a tribunal acted in grave
abuse of discretion, mere abuse of discretion is not enough. There must be grave
abuse of discretion as where the tribunal exercised its power in an arbitrary or
despotic manner, by reason of passion or personal hostility, and it must be so
patent or gross as would amount to an evasion, or virtual refusal to perform the
duty enjoined, or to act in contemplation of law.13
In the case at bar, petitioners contend that there was no appeal or other plain,
speedy or adequate remedy available in the ordinary course of law because they
were prevented by the trial court from appealing public respondent Montero’s Joint
Resolution dated November 8, 2002 which found, among others, probable cause
for estafa against them. They claim that the trial court "forced arraigned" them on
November 19, 2002. This was allegedly done in order to prevent them from
appealing the Joint Resolution dated November 8, 2002 to the Secretary of Justice
as a consequence of paragraph 2, section 7 of DOJ Circular No. 7014 ("2000
National Prosecution Service Rule on Appeal") which provides in part that "[i]f an
information has been filed in court pursuant to the appealed resolution, the petition
shall not be given due course if the accused has already been arraigned x x x."
We are not persuaded.
Petitioners admit15 that they received a copy of the Joint Resolution dated
November 8, 2002 as early as November 13, 2002. However, from the time they
received the copy of the aforesaid Resolution to the time they were arraigned on
November 19, 2002, petitioners did not take steps to move for reconsideration, or
appeal the aforesaid Resolution to the Secretary of Justice. More importantly, the
Court of Appeals observed that there is no evidence on record to support
petitioners’ claim that they were "forced arraigned." In fact, the arraignment of
petitioners proceeded without objections on the part of petitioners or their
counsel.16 Absent proof of force or intimidation, the trial judge enjoys the
presumption of regularity in the performance of his functions.17 We also note that
petitioners’ other co-accused, Roderick Lim Go and Grace Tan-Go, were able to
timely appeal the Joint Resolution dated November 8, 2002 to the Secretary of
Justice while petitioners failed to appeal the same before their arraignment.
In fine, the arguments raised in their petition for prohibition ineluctably shows that
petitioners are principally questioning the factual and legal bases of the finding of
probable cause against them. This is but a veiled attempt to litigate issues which
should have been timely appealed to the Secretary of Justice via a petition for
review. However, petitioners, through their own fault, failed to avail themselves of
this remedy. Countless times we have ruled that the extraordinary remedy of
certiorari or prohibition is not a substitute for a lost appeal.18 This case is no
different.
There is another equally important reason why the instant petition should be
denied outright. After the Court of Appeals issued the assailed Decision dated
November 24, 2003 which dismissed petitioners’ petition for prohibition, several
supervening events took place.
As earlier noted, petitioners failed to appeal from the Joint Resolution dated
November 8, 2002 issued by public respondent Montero which found, among
others, probable cause against them for estafa. Only co-accused Grace Tan-Go
and Roderick Go separately and timely appealed to the Secretary of Justice. Then
Secretary of Justice Simeon A. Datumanong subsequently issued a
Resolution19 dated December 23, 2003 granting Grace Tan-Go’s petition for
review. The aforesaid Resolution was, likewise, favorable to petitioners’ cause and
ordered, among others, the withdrawal of the informations for estafa against them:
WHEREFORE, the assailed Joint Resolution is hereby SET ASIDE and,
conformably with Department Order No. 473, dated December 8, 2003, which
recalls and supersedes Department Order No. 369 previously authorizing
Provincial Prosecutor Cezar Tajanlangit to conduct the preliminary investigation
Page 149 of 507
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and prosecution of the foregoing cases, the City Prosecutor of Cebu, is hereby
directed to—
(1) To withdraw the informations filed in Court against all the respondents for
Estafa.
(2) To file the corresponding Informations in Court against RODERICK LIM GO
only, for violations of BP 22 on eight (8) counts and proceed with the prosecution
thereof; and
(3) To submit to this Office, within ten (10) days from receipt of this Resolution, the
appropriate action or actions taken.
SO ORDERED.20
When King moved for reconsideration of the above Resolution, petitioners
participated in the proceedings before the Secretary of Justice by opposing the
same together with Grace Tan-Go.21 In a Resolution22 dated February 11, 2004,
then Acting Secretary of Justice Merceditas N. Guitierrez granted King’s motion for
reconsideration and reinstated public respondent Montero’s Joint Resolution dated
November 8, 2002. Grace Tan-Go then filed a motion for reconsideration which
was joined by petitioners through their motion for leave to join the motion for
reconsideration.23 However, Acting Secretary Guiterrez denied the same in a
Resolution dated August 18, 2004. Thereafter, Grace Tan-Go filed a motion to
resolve the second ground raised in her motion for reconsideration. In a
Resolution24 dated December 17, 2004, Secretary of Justice Raul M. Gonzalez
reversed and set aside the February 11, 2004 and August 18, 2004 Resolutions of
Acting Secretary Gutierrez, and reinstated former Secretary Datumanong’s
Resolution dated December 23, 2003. Consequently, a motion to withdraw
informations25 was filed by the prosecution before the trial court.
By participating in the proceedings before the Secretary of Justice, petitioners
have actively litigated the issues regarding the factual and legal bases of the
finding of probable cause against them as well as the authority of public
respondent Montero to file the subject criminal informations. This is clearly borne
by the tenor of the Resolution dated December 17, 2004 issued by the Secretary
of Justice. Yet, these issues are exactly the same issues being raised by
petitioners before this Court through the instant petition which is separate and
distinct from the proceedings before the Secretary of Justice whose aforesaid
Resolution is not the one before us for review. To reiterate, what is before us for
review is the Decision of the Court of Appeals which dismissed the petition for
prohibition filed by petitioners to restrain the trial court from proceeding with the
criminal cases against them.
In effect, by taking these two distinct courses of actions, petitioners have pursued
the same or related causes, prayed for the same or substantially the same reliefs,
and, in the process, have created the possibility of conflicting decisions being
rendered by the different fora upon the same issues which is precisely the evil that
the rule on forum-shopping seeks to prevent.26 Doubtless, they have engaged in a
form of forum-shopping. Their attempt to trifle with the courts and abuse their
processes must not be countenanced. As a consequence of petitioners’ violation of
the rule against forum-shopping and in order to preserve the laudable objectives of
the rule against forum-shopping, the dismissal of the petition for prohibition should
be upheld.27
WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals dated
November 24, 2003 in CA-G.R. SP No. 74450 dismissing petitioners’ petition for
prohibition, and the Resolution dated July 14, 2004 denying reconsideration
thereof, are AFFIRMED.
Costs against petitioners.
SO ORDERED.
MANDAMUS
G.R. Nos. 174813-15 March 17, 2009
NILO HIPOS, SR. REPRESENTING DARRYL HIPOS, BENJAMIN CORSIÑO
REPRESENTING JAYCEE CORSIÑO, and ERLINDA VILLARUEL
REPRESENTING ARTHUR VILLARUEL, Petitioners,
vs.
HONORABLE RTC JUDGE TEODORO A. BAY, Presiding Judge, RTC, Hall of
Justice, Quezon City, Branch 86, Respondent.
DECISION
Page 150 of 507
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CHICO-NAZARIO, J.:
This is a Petition for Mandamus under Rule 65 of the Rules of Court seeking a
reversal of the Order dated 2 October 2006 of respondent Judge Teodoro A. Bay
of Branch 86 of the Regional Trial Court (RTC) of Quezon City, which denied the
Motion to Withdraw Informations of the Office of the City Prosecutor of Quezon
City.
The facts of the case are as follows.
On 15 December 2003, two Informations for the crime of rape and one Information
for the crime of acts of lasciviousness were filed against petitioners Darryl Hipos,
Jaycee Corsiño, Arthur Villaruel and two others before Branch 86 of the Regional
Trial Court of Quezon City, acting as a Family Court, presided by respondent
Judge Bay. The cases were docketed as Criminal Cases No. Q-03-123284, No. Q-
03-123285 and No. Q-03-123286. The Informations were signed by Assistant City
Prosecutor Ronald C. Torralba.
On 23 February 2004, private complainants AAA1 and BBB filed a Motion for
Reinvestigation asking Judge Bay to order the City Prosecutor of Quezon City to
study if the proper Informations had been filed against petitioners and their co-
accused. Judge Bay granted the Motion and ordered a reinvestigation of the
cases.
On 19 May 2004, petitioners filed their Joint Memorandum to Dismiss the Case[s]
before the City Prosecutor. They claimed that there was no probable cause to hold
them liable for the crimes charged.
On 10 August 2004, the Office of the City Prosecutor issued a Resolution on the
reinvestigation affirming the Informations filed against petitioners and their co-
accused in Criminal Cases No. Q-03-123284-86. The Resolution was signed by
Assistant City Prosecutor Raniel S. Cruz and approved by City Prosecutor Claro A.
Arellano.
On 3 March 2006, 2nd Assistant City Prosecutor Lamberto C. de Vera, treating the
Joint Memorandum to Dismiss the Case as an appeal of the 10 August 2004
Resolution, reversed the Resolution dated 10 August 2004, holding that there was
lack of probable cause. On the same date, the City Prosecutor filed a Motion to
Withdraw Informations before Judge Bay.
On 2 October 2006, Judge Bay denied the Motion to Withdraw Informations in an
Order of even date.
Without moving for a reconsideration of the above assailed Order, petitioners filed
the present Petition for Mandamus, bringing forth this lone issue for our
consideration:
CAN THE HON. SUPREME COURT COMPEL RESPONDENT JUDGE BAY TO
DISMISS THE CASE THROUGH A WRIT OF MANDAMUS BY VIRTUE OF THE
RESOLUTION OF THE OFFICE OF THE CITY PROSECUTOR OF QUEZON
CITY FINDING NO PROBABLE CAUSE AGAINST THE ACCUSED AND
SUBSEQUENTLY FILING A MOTION TO WITHDRAW INFORMATION?2
Mandamus is an extraordinary writ commanding a tribunal, corporation, board,
officer or person, immediately or at some other specified time, to do the act
required to be done, when the respondent unlawfully neglects the performance of
an act which the law specifically enjoins as a duty resulting from an office, trust, or
station; or when the respondent excludes another from the use and enjoyment of a
right or office to which the latter is entitled, and there is no other plain, speedy and
adequate remedy in the ordinary course of law.3
As an extraordinary writ, the remedy of mandamus lies only to compel an officer to
perform a ministerial duty, not a discretionary one; mandamus will not issue to
control the exercise of discretion by a public officer where the law imposes upon
him the duty to exercise his judgment in reference to any manner in which he is
required to act, because it is his judgment that is to be exercised and not that of
the court.4
In the case at bar, the act which petitioners pray that we compel the trial court to
do is to grant the Office of the City Prosecutor’s Motion for Withdrawal of
Informations against petitioners. In effect, petitioners seek to curb Judge Bay’s
exercise of judicial discretion.
There is indeed an exception to the rule that matters involving judgment and
discretion are beyond the reach of a writ of mandamus, for such writ may be
issued to compel action in those matters, when refused.5 However, mandamus is
never available to direct the exercise of judgment or discretion in a particular way
or the retraction or reversal of an action already taken in the exercise of either.6 In
other words, while a judge refusing to act on a Motion to Withdraw
Informations can be compelled by mandamus to act on the same, he cannot be
Page 151 of 507
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compelled to act in a certain way, i.e., to grant or deny such Motion. In the case at
bar, Judge Bay did not refuse to act on the Motion to Withdraw Informations; he
had already acted on it by denying the same. Accordingly, mandamus is not
available anymore. If petitioners believed that Judge Bay committed grave abuse
of discretion in the issuance of such Order denying the Motion to Withdraw
Informations, the proper remedy of petitioners should have been to file a Petition
for Certiorari against the assailed Order of Judge Bay.
Petitioners counter that the above conclusion, which has been argued by the
Solicitor General, is contrary to a ruling of this Court, which allegedly states that
the proper remedy in such cases is a Petition for Mandamus and not Certiorari.
Petitioners cite the following excerpt from our ruling in Sanchez v. Demetriou7:
The appreciation of the evidence involves the use of discretion on the part of the
prosecutor, and we do not find in the case at bar a clear showing by the petitioner
of a grave abuse of such discretion.
The decision of the prosecutor may be reversed or modified by the Secretary of
Justice or in special cases by the President of the Philippines. But even this Court
cannot order the prosecution of a person against whom the prosecutor does not
find sufficient evidence to support at least a prima facie case. The courts try and
absolve or convict the accused but as a rule have no part in the initial decision to
prosecute him.
The possible exception is where there is an unmistakable showing of grave abuse
of discretion that will justify a judicial intrusion into the precincts of the executive.
But in such a case the proper remedy to call for such exception is a petition for
mandamus, not certiorari or prohibition.8 (Emphases supplied.)
Petitioners have taken the above passage way out of its context. In the case of
Sanchez, Calauan Mayor Antonio Sanchez brought a Petition for Certiorari before
this Court, challenging the order of the respondent Judge therein denying his
motion to quash the Information filed against him and six other persons for alleged
rape and homicide. One of the arguments of Mayor Sanchez was that there was
discrimination against him because of the non-inclusion of two other persons in the
Information. We held that even this Court cannot order the prosecution of a person
against whom the prosecutor does not find sufficient evidence to support at least a
prima facie case. However, if there was an unmistakable showing of grave abuse
of discretion on the part of the prosecutors in that case, Mayor Sanchez should
have filed a Petition for Mandamus to compel the filing of charges against said two
other persons.
In the case at bar, the Petition for Mandamus is directed not against the
prosecution, but against the trial court, seeking to compel the trial court to grant the
Motion to Withdraw Informations by the City Prosecutor’s Office. The prosecution
has already filed a case against petitioners. Recently, in Santos v. Orda, Jr., 9 we
reiterated the doctrine we established in the leading case of Crespo v.
Mogul,10 that once a criminal complaint or an information is filed in court, any
disposition or dismissal of the case or acquittal or conviction of the accused rests
within the jurisdiction, competence, and discretion of the trial court. Thus, we held:
In Crespo v. Mogul, the Court held that once a criminal complaint or information is
filed in court, any disposition of the case or dismissal or acquittal or conviction of
the accused rests within the exclusive jurisdiction, competence, and discretion of
the trial court. The trial court is the best and sole judge on what to do with the case
before it. A motion to dismiss the case filed by the public prosecutor should be
addressed to the court who has the option to grant or deny the same. Contrary to
the contention of the petitioner, the rule applies to a motion to withdraw the
Information or to dismiss the case even before or after arraignment of the accused.
The only qualification is that the action of the court must not impair the substantial
rights of the accused or the right of the People or the private complainant to due
process of law. When the trial court grants a motion of the public prosecutor to
dismiss the case, or to quash the Information, or to withdraw the Information in
compliance with the directive of the Secretary of Justice, or to deny the said
motion, it does so not out of subservience to or defiance of the directive of the
Secretary of Justice but in sound exercise of its judicial prerogative.
Petitioners also claim that since Judge Bay granted a Motion for Reinvestigation,
he should have "deferred to the Resolution of Asst. City Prosecutor De Vera
withdrawing the case."11 Petitioners cite the following portion of our Decision in
People v. Montesa, Jr.12:
In the instant case, the respondent Judge granted the motion for reinvestigation
and directed the Office of the Provincial Prosecutor of Bulacan to conduct the
reinvestigation. The former was, therefore, deemed to have deferred to the
authority of the prosecution arm of the Government to consider the so-called new
relevant and material evidence and determine whether the information it had filed
should stand.13
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Like what was done to our ruling in Sanchez, petitioners took specific statements
from our Decision, carefully cutting off the portions which would expose the real
import of our pronouncements. The Petition for Certiorari in Montesa, Jr. was
directed against a judge who, after granting the Petition for Reinvestigation filed by
the accused, proceeded nonetheless to arraign the accused; and, shortly
thereafter, the judge decided to dismiss the case on the basis of a Resolution of
the Assistant Provincial Prosecutor recommending the dismissal of the case. The
dismissal of the case in Montesa, Jr. was done despite the disapproval of the
Assistant Provincial Prosecutor’s Resolution by the Provincial Prosecutor
(annotated in the same Resolution), and despite the fact that the reinvestigation
the latter ordered was still ongoing, since the Resolution of the Assistant Provincial
Prosecutor had not yet attained finality. We held that the judge should have waited
for the conclusion of the Petition for Reinvestigation he ordered, before acting on
whether or not the case should be dismissed for lack of probable cause, and
before proceeding with the arraignment. Thus, the continuation of the above
paragraph of our Decision in Montesa, Jr. reads:
Having done so, it behooved the respondent Judge to wait for a final resolution of
the incident. In Marcelo vs. Court of Appeals, this Court ruled:
Accordingly, we rule that the trial court in a criminal case which takes cognizance
of an accused's motion for review of the resolution of the investigating prosecutor
or for reinvestigation and defers the arraignment until resolution of the said motion
must act on the resolution reversing the investigating prosecutor's finding or on a
motion to dismiss based thereon only upon proof that such resolution is already
final in that no appeal was taken thereon to the Department of Justice.
The resolution of Assistant Provincial Prosecutor Rutor recommending the
dismissal of the case never became final, for it was not approved by the Provincial
Prosecutor. On the contrary, the latter disapproved it. As a consequence, the final
resolution with respect to the reinvestigation is that of the Provincial Prosecutor, for
under Section 4, Rule 112 of the Rules of Court, no complaint or information may
be filed or dismissed by an investigating fiscal without the prior written authority or
approval of the provincial or city fiscal or chief state prosecutor. Also, under
Section l(d) of R.A. No. 5180, as amended by P.D. No. 77 and P.D. No. 911.14
As can be clearly seen, the statement quoted by petitioners from Montesa, Jr. is
not meant to establish a doctrine that the judge should just follow the determination
by the prosecutor of whether or not there is probable cause. On the contrary,
Montesa, Jr. states:
The rule is settled that once a criminal complaint or information is filed in court, any
disposition thereof, such as its dismissal or the conviction or acquittal of the
accused, rests in the sound discretion of the court. While the prosecutor retains the
discretion and control of the prosecution of the case, he cannot impose his opinion
on the court. The court is the best and sole judge on what to do with the case.
Accordingly, a motion to dismiss the case filed by the prosecutor before or after the
arraignment, or after a reinvestigation, or upon instructions of the Secretary of
Justice who reviewed the records upon reinvestigation, should be addressed to the
discretion of the court. The action of the court must not, however, impair the
substantial rights of the accused or the right of the People to due process of law. 15
In a seemingly desperate attempt on the part of petitioners’ counsel, he tries to
convince us that a judge is allowed to deny a Motion to Withdraw Informations
from the prosecution only when there is grave abuse of discretion on the part of
the prosecutors moving for such withdrawal; and that, where there is no grave
abuse of discretion on the part of the prosecutors, the denial of the Motion to
Withdraw Informations is void. Petitioners’ counsel states in the Memorandum:
6.10. Furthermore, the ORDER dated October 2, 2006 of the Respondent Judge
BAY consisting of 9 pages which was attached to the URGENT PETITION did not
point out any iota of grave abuse of discretion committed by Asst. City Prosecutor
De Vera in issuing his Resolution in favor of the sons of the Petitioners. Hence, the
ORDER issued by RJBAY is NULL and VOID in view of the recent ruling of the
Hon. Supreme Court in Ledesma vs. Court of Appeals, G.R. No. 113216,
September 5, 1997, 86 SCAD 695, 278 SCRA 657 which states that:
"In the absence of a finding of grave abuse of discretion, the court’s bare denial of
a motion to withdraw information pursuant to the Secretary’s resolution is
void." (Underscoring ours).
6.11. It is therefore respectfully submitted that the Hon. Supreme Court disregard
the argument of the OSG because of its falsity.16
This statement of petitioners’ counsel is utterly misleading. There is no such
statement in our Decision in Ledesma.17 The excerpt from Ledesma, which
appears to have a resemblance to the statement allegedly quoted from said case,
provides:
No Grave Abuse of Discretion in the Resolution of the Secretary of Justice
Page 153 of 507
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In the light of recent holdings in Marcelo and Martinez; and considering that the
issue of the correctness of the justice secretary's resolution has been amply
threshed out in petitioner's letter, the information, the resolution of the secretary of
justice, the motion to dismiss, and even the exhaustive discussion in the motion for
reconsideration - all of which were submitted to the court - the trial judge
committed grave abuse of discretion when it denied the motion to withdraw the
information, based solely on his bare and ambiguous reliance on Crespo. The trial
court's order is inconsistent with our repetitive calls for an independent and
competent assessment of the issue(s) presented in the motion to dismiss. The trial
judge was tasked to evaluate the secretary's recommendation finding the absence
of probable cause to hold petitioner criminally liable for libel. He failed to do so. He
merely ruled to proceed with the trial without stating his reasons for disregarding
the secretary's recommendation.18 (Emphasis supplied.)
It very much appears that the counsel of petitioners is purposely misleading this
Court, in violation of Rule 10.02 of the Code of Professional Responsibility, which
provides:
Rule 10.02 – A lawyer shall not knowingly misquote or misrepresent the contents
of a paper, the language or the argument of opposing counsel, or the text of a
decision or authority, or knowingly cite as law a provision already rendered
inoperative by repel or amendment, or assert as a fact that which has not been
proved.
Counsel’s use of block quotation and quotation marks signifies that he intends to
make it appear that the passages are the exact words of the Court. Furthermore,
putting the words "Underscoring ours" after the text implies that, except for the
underscoring, the text is a faithful reproduction of the original. Accordingly, we are
ordering Atty. Procopio S. Beltran, Jr. to show cause why he should not be
disciplined as a member of the Bar.
To clarify, we never stated in Ledesma that a judge is allowed to deny a Motion to
Withdraw Information from the prosecution only when there is grave abuse of
discretion on the part of the prosecutors moving for such withdrawal. Neither did
we rule therein that where there is no grave abuse of discretion on the part of the
prosecutors, the denial of the Motion to Withdraw Information is void. What we
held therein is that a trial judge commits grave abuse of discretion if he denies a
Motion to Withdraw Information without an independent and complete assessment
of the issues presented in such Motion. Thus, the opening paragraph of Ledesma
states:
When confronted with a motion to withdraw an information on the ground of lack of
probable cause based on a resolution of the secretary of justice, the bounden duty
of the trial court is to make an independent assessment of the merits of such
motion. Having acquired jurisdiction over the case, the trial court is not bound by
such resolution but is required to evaluate it before proceeding further with the trial.
While the secretary's ruling is persuasive, it is not binding on courts. A trial court,
however, commits reversible error or even grave abuse of discretion if it
refuses/neglects to evaluate such recommendation and simply insists on
proceeding with the trial on the mere pretext of having already acquired jurisdiction
over the criminal action.19 (Emphases supplied.)1avvphi1.zw+
Petitioners also try to capitalize on the fact that the dispositive portion of the
assailed Order apparently states that there was no probable cause against
petitioners:
WHEREFORE, finding no probable cause against the herein accused for the
crimes of rapes and acts of lasciviousness, the motion to withdraw informations is
DENIED.
Let the case be set for arraignment and pre-trial on October 24, 2006 at 8:30
o’clock in the morning.20(Underscoring ours.)
Thus, petitioners claim that since even the respondent judge himself found no
probable cause against them, the Motion to Withdraw Informations by the Office of
the City Prosecutor should be granted.21
Even a cursory reading of the assailed Order, however, clearly shows that the
insertion of the word "no" in the above dispositive portion was a mere clerical error.
The assailed Order states in full:
After a careful study of the sworn statements of the complainants and the
resolution dated March 3, 2006 of 2nd Assistant City Prosecutor Lamberto C. de
Vera, the Court finds that there was probable cause against the herein
accused. The actuations of the complainants after the alleged rapes and acts of
lasciviousness cannot be the basis of dismissal or withdrawal of the herein cases.
Failure to shout or offer tenatious resistance did not make voluntary the
complainants’ submission to the criminal acts of the accused (People v.
Velasquez, 377 SCRA 214, 2002). The complainants’ affidavits indicate that the
accused helped one another in committing the acts complained of. Considering
that the attackers were not strangers but their trusted classmates who enticed
Page 154 of 507
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them to go to the house where they were molested, the complainants cannot be
expected to react forcefully or violently in protecting themselves from the
unexpected turn of events. Considering also that both complainants were fifteen
(15) years of age and considered children under our laws, the ruling of the
Supreme Court in People v. Malones, G.R. Nos. 124388-90, March 11, 2004
becomes very relevant. The Supreme Court ruled as follows:
Rape victims, especially child victims, should not be expected to act the way
mature individuals would when placed in such a situation. It is not proper to judge
the actions of children who have undergone traumatic experience by the norms of
behavior expected from adults under similar circumstances. The range of emotions
shown by rape victim is yet to be captured even by calculus. It is, thus, unrealistic
to expect uniform reactions from rape victims (People v. Malones, G.R. Nos.
124388-90, March 11, 2004).
The Court finds no need to discuss in detail the alleged actuations of the
complainants after the alleged rapes and acts of lasciviousness. The alleged
actuations are evidentiary in nature and should be evaluated after full blown trial
on the merits. This is necessary to avoid a suspicion of prejudgment against the
accused.22
As can be seen, the body of the assailed Order not only plainly stated that the
court found probable cause against the petitioners, but likewise provided an
adequate discussion of the reasons for such finding. Indeed, the general rule is
that where there is a conflict between the dispositive portion or the fallo and the
body of the decision, the fallo controls. However, where the inevitable conclusion
from the body of the decision is so clear as to show that there was a mistake in the
dispositive portion, the body of the decision will prevail.23
In sum, petitioners’ resort to a Petition for Mandamus to compel the trial judge to
grant their Motion to Withdraw Informations is improper. While mandamus is
available to compel action on matters involving judgment and discretion when
refused, it is never available to direct the exercise of judgment or discretion in a
particular way or the retraction or reversal of an action already taken in the
exercise of either.24 The trial court, when confronted with a Motion to Withdraw an
Information on the ground of lack of probable cause, is not bound by the resolution
of the prosecuting arm of the government, but is required to make an independent
assessment of the merits of such motion, a requirement satisfied by the
respondent judge in the case at bar.25
Finally, if only to appease petitioners who came to this Court seeking a review of
the finding of probable cause by the trial court, we nevertheless carefully reviewed
the records of the case. After going through the same, we find that we are in
agreement with the trial court that there is indeed probable cause against the
petitioners sufficient to hold them for trial. We decided to omit a detailed discussion
of the merits of the case, as we are not unmindful of the undue influence that might
result should this Court do so, even if such discussion is only intended to focus on
the finding of probable cause.
WHEREFORE, the instant Petition for Mandamus is DISMISSED. Let the records
of this case be remanded to the Regional Trial Court of Quezon City for the
resumption of the proceedings therein. The Regional Trial Court is directed to act
on the case with dispatch.
Atty. Procopio S. Beltran, Jr. is ORDERED to SHOW CAUSE why he should not
be disciplined as a member of the Bar for his disquieting conduct as herein
discussed.
SO ORDERED.
G.R. No. 161735 September 25, 2007
EX-C1C JIMMY B. SANCHEZ and EX-C2C SALVADOR A.
METEORO, Petitioners,
vs.
ROBERTO T. LASTIMOSO, in his capacity as DIRECTOR GENERAL OF THE
PHILIPPINE NATIONAL POLICE,Respondent.
DECISION
NACHURA, J.:
Before the Court is a petition for review on certiorari under Rule 45 of the Rules of
Court assailing the June 18, 2003 Decision2 of the Court of Appeals (CA) in CA-
G.R. SP No. 68989 and the January 15, 2004 Resolution3 denying the motion for
reconsideration thereof.
Page 155 of 507
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In 1989, petitioner Sanchez, a constable in the Philippine Constabulary (PC), was
discharged from the service for allegedly losing his service firearm. Petitioner
Meteoro, also a constable, was likewise discharged from the service in 1990 for
being absent without leave. On appeal, they were both cleared of all charges. They
then applied for reinstatement but their applications were not acted upon even up
to the integration of the PC into the Philippine National Police (PNP).4
On January 27, 1998, the National Police Commission (NAPOLCOM) issued
Resolution No. 98-037 considering as absorbed into the police force, among
others, those who had been discharged by virtue of pending administrative or
criminal cases but who were later acquitted or had their cases dismissed, and who
subsequently filed petitions for reinstatement that were not acted upon by the
PNP.5 Then, on April 3, 1998, NAPOLCOM
issued Resolution No. 98-105 affirming and confirming the absorption into the
PNP, effective on January 27, 1998, of the 126 ex-PC constables named in the list
submitted by Director Edgar C. Galvante of the PNP Directorate for Personnel and
Records Management (DPRM).6 Petitioners Sanchez and Meteoro are in numbers
90 and 122, respectively, of the Galvante list.7
Subsequently, on May 28, 1998, NAPOLCOM Commissioner Rogelio A. Pureza
issued a Memorandum to then Chief of the PNP Santiago Alino for the issuance of
absorption orders to the 45 PC constables included in the initial batch of those
covered by the PNP Board Resolutions.8 Petitioner Sanchez is in number 45 of
that list.9
As no absorption order had yet been issued by the Chief of the PNP, the
constables in the list requested the assistance of the Secretary of the Department
of Interior and Local Government (DILG). On July 29, 1998, the Office of the
Secretary of the DILG sent a memorandum to respondent Roberto T. Lastimoso,
then the Chief of the PNP, endorsing the constables’ entreaties and requesting for
a feedback thereon.10
Without any response from the Chief of the PNP, and their pleas for the issuance
of the absorption orders still unacted upon, petitioners instituted, on September 30,
1998, a petition for mandamus docketed as Civil Case No. Q-98-35659 in the
Regional Trial Court (RTC) of Quezon City. 11
During the pendency of the said petition, NAPOLCOM issued Resolution No. 99-
061 on April 19, 1999 recalling the earlier Resolution No. 98-105.12 The recall was
based on the Commission’s finding that the list submitted by Galvante was not
actually of the constables whose applications for absorption were indorsed for
approval, but of those whose applications were still to be reviewed, evaluated and
disposed of. In other words, the 126 named in the list were still to be interviewed
and their applications to be deliberated upon by the PNP Special Committee. 13
On November 15, 2001, however, the RTC rendered its Decision 14 in the
mandamus case declaring as void ab initio NAPOLCOM Resolution No. 99-061
and ruling in favor of the petitioners. The dispositive portion of the Decision reads:
Accordingly, therefore, the petition is hereby granted. The Director-General of the
Philippine National Police is hereby directed to immediately issue absorption
orders to the petitioners.
Resolution No. 99-061 is declared void ab initio.
IT IS SO ORDERED.15
On appeal, the CA, in the assailed June 18, 2003 Decision,16 reversed the ruling of
the trial court and ruled that a writ of mandamus could not be issued because
petitioners had not established with distinct clarity their right to be absorbed into
the PNP. The CA disposed of the appeal as follows:
WHEREFORE, the appeal is GRANTED. The decision of the trial court dated
November 15, 2001 is hereby REVERSED and SET ASIDE.
SO ORDERED.17
The appellate court later denied petitioners’ motion for reconsideration in the
likewise assailed January 15, 2004 Resolution.18
Aggrieved, petitioners brought the case before us via a petition for review on
certiorari, raising for our disposition the following issues:
I
WHETHER OR NOT PETITIONERS HAVE A CLEAR LEGAL RIGHT TO
BE ABSORBED IN THE PHILIPPINE NATIONAL POLICE.
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 II.
WHETHER OR NOT RESOLUTION NO. 99-061 IS VOID FOR BEING
VIOLATIVE OF THE PROVISIONS OF R.A. 7965 AND ITS
IMPLEMENTING RESOLUTIONS NO. 98-037 AND 98-105.
III.
WHETHER OR NOT PETITIONERS HAVE A CAUSE OF ACTION FOR
MANDAMUS TO COMPEL THE RESPONDENT TO ABSORB THE
PETITIONERS IN THE PHILIPPINE NATIONAL POLICE.19
The petition has no merit.
We have repeatedly stressed in our prior decisions that the remedy
of mandamus is employed only to compel the performance, when refused, of a
ministerial duty, but not to require anyone to fulfill a discretionary one. The
issuance of the writ is simply a command to exercise a power already possessed
and to perform a duty already imposed.20 In Manila International Airport Authority
v. Rivera Village Lessee Homeowners Association, Inc.,21 we emphasized, through
the erudite and eloquent ponencia of Justice Dante O. Tinga, that the writ can be
issued only when the applicant’s legal right to the performance of a particular act
sought to be compelled is clear and complete, one which is indubitably granted by
law or is inferable as a matter of law, thus:
In order that a writ of mandamus may aptly issue, it is essential that, on the one
hand, petitioner has a clear legal right to the claim that is sought and that, on the
other hand, respondent has an imperative duty to perform that which is demanded
of him. Mandamus will not issue to enforce a right, or to compel compliance with a
duty, which is questionable or over which a substantial doubt exists. The principal
function of the writ of mandamus is to command and to expedite, not to inquire and
to adjudicate. Thus, it is neither the office nor the aim of the writ to secure a legal
right but to implement that which is already established. Unless the right to relief
sought is unclouded, mandamus will not issue.22
Viewed in light of the said guideposts, the PNP Chief’s issuance of the orders for
the absorption of herein petitioners in the police force is not compellable by a writ
of mandamus precisely because the same does not involve a performance of a
ministerial duty. Let it be noted that petitioners were discharged from the PC
service, subsequently cleared of the charges against them, applied for
reinstatement but their applications were not acted upon until the integration of the
PC into the PNP in 1990 when R.A. No. 697523 was enacted. Thus, we no longer
speak of the reinstatement of the petitioners to the service because the Philippine
Constabulary no longer exists, but of their employment in the PNP which is, as we
held in Gloria v. De Guzman,24 technically an issuance of a new appointment. The
power to appoint is essentially discretionary to be performed by the officer in which
it is vested according to his best lights, the only condition being that the appointee
should possess the qualifications required by law.25 Consequently, it cannot be the
subject of an application for a writ of mandamus.26
Furthermore, the petitioners do not have a clear legal right over the issuance of the
absorption orders.1âwphi1 They cannot claim the right to be issued an
appointment based on the NAPOLCOM issuances, specifically Resolution Nos.
98-037 and 98-105. Suffice it to state that R.A. No. 6975 clearly provides that the
power to appoint PNP personnel with the rank of "Police Officer I" to "Senior Police
Officer IV" to which petitioners may be appointed27 is vested in the PNP regional
director or in the Chief of the PNP as the case may be, and not in the
NAPOLCOM, thus:
Section 31. Appointment of PNP Officers and Members.—The appointment of the
officers and members of the PNP shall be effected in the following manner:
(a) Police Officer I to Senior Police Officer IV.—Appointed by the PNP regional
director for regional personnel or by the Chief of the PNP for the national
headquarters personnel and attested by the Civil Service Commission.
x x x28
Even if, for the sake of argument, petitioners can derive a right from NAPOLCOM
Resolution Nos. 98-037 and 98-105, still their right collapses and their mandamus
petition becomes moot with the issuance by NAPOLCOM of Resolution No. 99-061
recalling the approval of their absorption. The trial court should then have
immediately dismissed the mandamus petition when the OSG submitted a copy of
Resolution No. 99-061 because well-settled is the rule that courts will not resolve a
moot question.29
Also improper is the trial court’s declaration that NAPOLCOM Resolution No. 99-
061 is void ab initio. In the petition filed below, only the Chief of the PNP is
impleaded as the party-defendant.30 NAPOLCOM was never impleaded. As it was
the latter, a separate entity, which had issued Resolution No. 99-061, NAPOLCOM
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was an indispensable party over which the trial court should have acquired
jurisdiction. Since it was not impleaded, NAPOLCOM remains a stranger to the
case, and strangers are not bound by the judgment rendered by the court. 31 The
absence of an indispensable party renders all subsequent actions of the court null
and void for want of authority to act, not only as to the absent parties but even as
to those present.32
WHEREFORE, premises considered, the petition is DENIED. The June 18, 2003
Decision and the January 15, 2004 Resolution of the Court of Appeals in CA-G.R.
SP No. 68989 are AFFIRMED.
SO ORDERED.
G.R. No. 156052 March 7, 2007
SOCIAL JUSTICE SOCIETY (SJS), VLADIMIR ALARIQUE T. CABIGAO, and
BONIFACIO S. TUMBOKON, Petitioners,
vs.
HON. JOSE L. ATIENZA, JR., in his capacity as Mayor of the City of
Manila, Respondent.
DECISION
CORONA, J.:
In this original petition for mandamus,1 petitioners Social Justice Society (SJS),
Vladimir Alarique T. Cabigao and Bonifacio S. Tumbokon seek to compel
respondent Hon. Jose L. Atienza, Jr., mayor of the City of Manila, to enforce
Ordinance No. 8027.
The antecedents are as follows.
On November 20, 2001, the Sangguniang Panlungsod of Manila enacted
Ordinance No. 8027.2 Respondent mayor approved the ordinance on November
28, 2001.3 It became effective on December 28, 2001, after its publication.4
Ordinance No. 8027 was enacted pursuant to the police power delegated to local
government units, a principle described as the power inherent in a government to
enact laws, within constitutional limits, to promote the order, safety, health, morals
and general welfare of the society.5 This is evident from Sections 1 and 3 thereof
which state:
SECTION 1. For the purpose of promoting sound urban planning and ensuring
health, public safety, and general welfare of the residents of Pandacan and Sta.
Ana as well as its adjoining areas, the land use of [those] portions of land bounded
by the Pasig River in the north, PNR Railroad Track in the east, Beata St. in the
south, Palumpong St. in the southwest, and Estero de Pancacan in the west[,]
PNR Railroad in the northwest area, Estero de Pandacan in the [n]ortheast, Pasig
River in the southeast and Dr. M.L. Carreon in the southwest. The area of Punta,
Sta. Ana bounded by the Pasig River, Marcelino Obrero St., Mayo 28 St., and F.
Manalo Street, are hereby reclassified from Industrial II to Commercial I.
xxx xxx xxx
SEC. 3. Owners or operators of industries and other businesses, the operation of
which are no longer permitted under Section 1 hereof, are hereby given a period of
six (6) months from the date of effectivity of this Ordinance within which to cease
and desist from the operation of businesses which are hereby in consequence,
disallowed.
Ordinance No. 8027 reclassified the area described therein from industrial to
commercial and directed the owners and operators of businesses disallowed under
Section 1 to cease and desist from operating their businesses within six months
from the date of effectivity of the ordinance. Among the businesses situated in the
area are the so-called "Pandacan Terminals" of the oil companies Caltex
(Philippines), Inc., Petron Corporation and Pilipinas Shell Petroleum Corporation.
However, on June 26, 2002, the City of Manila and the Department of Energy
(DOE) entered into a memorandum of understanding (MOU) 6 with the oil
companies in which they agreed that "the scaling down of the Pandacan Terminals
[was] the most viable and practicable option." Under the MOU, the oil companies
agreed to perform the following:
Section 1. - Consistent with the objectives stated above, the OIL COMPANIES
shall, upon signing of this MOU, undertake a program to scale down the Pandacan
Terminals which shall include, among others, the immediate
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removal/decommissioning process of TWENTY EIGHT (28) tanks starting with the
LPG spheres and the commencing of works for the creation of safety buffer and
green zones surrounding the Pandacan Terminals. xxx
Section 2. – Consistent with the scale-down program mentioned above, the OIL
COMPANIES shall establish joint operations and management, including the
operation of common, integrated and/or shared facilities, consistent with
international and domestic technical, safety, environmental and economic
considerations and standards. Consequently, the joint operations of the OIL
COMPANIES in the Pandacan Terminals shall be limited to the common and
integrated areas/facilities. A separate agreement covering the commercial and
operational terms and conditions of the joint operations, shall be entered into by
the OIL COMPANIES.
Section 3. - The development and maintenance of the safety and green buffer
zones mentioned therein, which shall be taken from the properties of the OIL
COMPANIES and not from the surrounding communities, shall be the sole
responsibility of the OIL COMPANIES.
The City of Manila and the DOE, on the other hand, committed to do the following:
Section 1. - The City Mayor shall endorse to the City Council this MOU for its
appropriate action with the view of implementing the spirit and intent thereof.
Section 2. - The City Mayor and the DOE shall, consistent with the spirit and intent
of this MOU, enable the OIL COMPANIES to continuously operate in compliance
with legal requirements, within the limited area resulting from the joint operations
and the scale down program.
Section 3. - The DOE and the City Mayor shall monitor the OIL COMPANIES’
compliance with the provisions of this MOU.
Section 4. - The CITY OF MANILA and the national government shall protect the
safety buffer and green zones and shall exert all efforts at preventing future
occupation or encroachment into these areas by illegal settlers and other
unauthorized parties.
The Sangguniang Panlungsod ratified the MOU in Resolution No. 97.7 In the same
resolution, the Sangguniandeclared that the MOU was effective only for a period of
six months starting July 25, 2002.8 Thereafter, on January 30, 2003,
the Sanggunian adopted Resolution No. 139 extending the validity of Resolution
No. 97 to April 30, 2003 and authorizing Mayor Atienza to issue special business
permits to the oil companies. Resolution No. 13, s. 2003 also called for a
reassessment of the ordinance.10
Meanwhile, petitioners filed this original action for mandamus on December 4,
2002 praying that Mayor Atienza be compelled to enforce Ordinance No. 8027 and
order the immediate removal of the terminals of the oil companies.11
The issues raised by petitioners are as follows:
1. whether respondent has the mandatory legal duty to enforce Ordinance
No. 8027 and order the removal of the Pandacan Terminals, and
2. whether the June 26, 2002 MOU and the resolutions ratifying it can
amend or repeal Ordinance No. 8027.12
Petitioners contend that respondent has the mandatory legal duty, under Section
455 (b) (2) of the Local Government Code (RA 7160),13 to enforce Ordinance No.
8027 and order the removal of the Pandacan Terminals of the oil companies.
Instead, he has allowed them to stay.
Respondent’s defense is that Ordinance No. 8027 has been superseded by the
MOU and the resolutions.14However, he also confusingly argues that the ordinance
and MOU are not inconsistent with each other and that the latter has not amended
the former. He insists that the ordinance remains valid and in full force and effect
and that the MOU did not in any way prevent him from enforcing and implementing
it. He maintains that the MOU should be considered as a mere guideline for its full
implementation.15
Under Rule 65, Section 316 of the Rules of Court, a petition for mandamus may be
filed when any tribunal, corporation, board, officer or person unlawfully neglects
the performance of an act which the law specifically enjoins as a duty resulting
from an office, trust or station. Mandamus is an extraordinary writ that is employed
to compel the performance, when refused, of a ministerial duty that is already
imposed on the respondent and there is no other plain, speedy and adequate
remedy in the ordinary course of law. The petitioner should have a well-defined,
clear and certain legal right to the performance of the act and it must be the clear
and imperative duty of respondent to do the act required to be done. 17
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Mandamus will not issue to enforce a right, or to compel compliance with a duty, We need not resolve this issue. Assuming that the terms of the MOU were inconsistent with Ordinance No. 8027, the

which is questionable or over which a substantial doubt exists. The principal
function of the writ of mandamus is to command and to expedite, not to inquire and
to adjudicate; thus, it is neither the office nor the aim of the writ to secure a legal
right but to implement that which is already established. Unless the right to the
relief sought is unclouded, mandamus will not issue.18
resolutions which ratified it and made it binding on the City of Manila expressly gave it full force and effect only until April 30,
2003. Thus, at present, there is nothing that legally hinders respondent from enforcing Ordinance No. 8027.24
Ordinance No. 8027 was enacted right after the Philippines, along with the rest of the world, witnessed the horror of the
September 11, 2001 attack on the Twin Towers of the World Trade Center in New York City. The objective of the ordinance is
to protect the residents of Manila from the catastrophic devastation that will surely occur in case of a terrorist attack25 on the

To support the assertion that petitioners have a clear legal right to the enforcement Pandacan Terminals. No reason exists why such a protective measure should be delayed.

of the ordinance, petitioner SJS states that it is a political party registered with the
Commission on Elections and has its offices in Manila. It claims to have many WHEREFORE, the petition is hereby GRANTED. Respondent Hon. Jose L. Atienza, Jr., as mayor of the City of Manila, is
members who are residents of Manila. The other petitioners, Cabigao and directed to immediately enforce Ordinance No. 8027.
Tumbokon, are allegedly residents of Manila.
SO ORDERED.
We need not belabor this point. We have ruled in previous cases that when
a mandamus proceeding concerns a public right and its object is to compel a
public duty, the people who are interested in the execution of the laws are
regarded as the real parties in interest and they need not show any specific
interest.19 Besides, as residents of Manila, petitioners have a direct interest in the
enforcement of the city’s ordinances. Respondent never questioned the right of G.R. No. 193462 February 4, 2014
petitioners to institute this proceeding.
DENNIS A.B. FUNA, Petitioner,
On the other hand, the Local Government Code imposes upon respondent the vs.
duty, as city mayor, to "enforce all laws and ordinances relative to the governance MANILA ECONOMIC AND CULTURAL OFFICE and the COMMISSION ON
of the city.">20 One of these is Ordinance No. 8027. As the chief executive of the AUDIT, Respondents.
city, he has the duty to enforce Ordinance No. 8027 as long as it has not been
repealed by the Sanggunian or annulled by the courts.21 He has no other choice. It is his DECISION
ministerial duty to do so. In Dimaporo v. Mitra, Jr.,22 we stated the reason for this:

PEREZ, J.:
These officers cannot refuse to perform their duty on the ground of an alleged invalidity of the statute imposing the duty. The
reason for this is obvious. It might seriously hinder the transaction of public business if these officers were to be permitted in all
This is a petition for mandamus1 to compel:
cases to question the constitutionality of statutes and ordinances imposing duties upon them and which have not judicially been
declared unconstitutional. Officers of the government from the highest to the lowest are creatures of the law and are bound to
obey it.23
1.) the Commission on Audit (COA) to audit and examine the funds of the
Manila Economic and Cultural Office (MECO), and
The question now is whether the MOU entered into by respondent with the oil companies and the subsequent resolutions
passed by the Sanggunian have made the respondent’s duty to enforce Ordinance No. 8027 doubtful, unclear or uncertain. 2.) the MECO to submit to such audit and examination.
This is also connected to the second issue raised by petitioners, that is, whether the MOU and Resolution Nos. 97, s. 2002 and
13, s. 2003 of the Sanggunian can amend or repeal Ordinance No. 8027. The antecedents:

Prelude

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The aftermath of the Chinese civil war2 left the country of China with two (2)
governments in a stalemate espousing competing assertions of sovereignty.3 On
one hand is the communist People’s Republic of China (PROC) which controls the
mainland territories, and on the other hand is the nationalist Republic of China
(ROC) which controls the island of Taiwan. For a better part of the past century,
both the PROC and ROC adhered to a policy of "One China" i.e., the view that
there is only one legitimate government in China, but differed in their respective
interpretation as to which that government is.4
With the existence of two governments having conflicting claims of sovereignty
over one country, came the question as to which of the two is deserving of
recognition as that country’s legitimate government. Even after its relocation to
Taiwan, the ROC used to enjoy diplomatic recognition from a majority of the
world’s states, partly due to being a founding member of the United Nations
(UN).5 The number of states partial to the PROC’s version of the One China policy,
however, gradually increased in the 1960s and 70s, most notably after the UN
General Assembly adopted the monumental Resolution 2758 in 1971.6 Since then,
almost all of the states that had erstwhile recognized the ROC as the legitimate
government of China, terminated their official relations with the said government, in
favor of establishing diplomatic relations with the PROC.7 The Philippines is one of
such states.
The Philippines formally ended its official diplomatic relations with the government
in Taiwan on 9 June 1975, when the country and the PROC expressed mutual
recognition thru the Joint Communiqué of the Government of the Republic of the
Philippines and the Government of the People’s Republic of China (Joint
Communiqué).8
Under the Joint Communiqué, the Philippines categorically stated its adherence to
the One China policy of the PROC. The pertinent portion of the Joint Communiqué
reads:9
The Philippine Government recognizes the Government of the People’s Republic
of China as the sole legal government of China, fully understands and respects the
position of the Chinese Government that there is but one China and that Taiwan is
an integral part of Chinese territory, and decides to remove all its official
representations from Taiwan within one month from the date of signature of this
communiqué. (Emphasis supplied)
The Philippines’ commitment to the One China policy of the PROC, however, did
not preclude the country from keeping unofficial relations with Taiwan on a
"people-to-people" basis.10 Maintaining ties with Taiwan that is permissible by the
terms of the Joint Communiqué, however, necessarily required the Philippines,
and Taiwan, to course any such relations thru offices outside of the official or
governmental organs.
Hence, despite ending their diplomatic ties, the people of Taiwan and of the
Philippines maintained an unofficial relationship facilitated by the offices of the
Taipei Economic and Cultural Office, for the former, and the MECO, for the latter. 11
The MECO12 was organized on 16 December 1997 as a non-stock, non-profit
corporation under Batas Pambansa Blg. 68 or the Corporation Code.13 The
purposes underlying the incorporation of MECO, as stated in its articles of
incorporation,14 are as follows:
1. To establish and develop the commercial and industrial interests of
Filipino nationals here and abroad, and assist on all measures designed to
promote and maintain the trade relations of the country with the citizens of
other foreign countries;
2. To receive and accept grants and subsidies that are reasonably
necessary in carrying out the corporate purposes provided they are not
subject to conditions defeatist for or incompatible with said purpose;
3. To acquire by purchase, lease or by any gratuitous title real and
personal properties as may be necessary for the use and need of the
corporation, and to dispose of the same in like manner when they are no
longer needed or useful; and
4. To do and perform any and all acts which are deemed reasonably
necessary to carry out the purposes. (Emphasis supplied)
From the moment it was incorporated, the MECO became the corporate entity
"entrusted" by the Philippine government with the responsibility of fostering
"friendly" and "unofficial" relations with the people of Taiwan, particularly in the
areas of trade, economic cooperation, investment, cultural, scientific and
educational exchanges.15To enable it to carry out such responsibility, the MECO
was "authorized" by the government to perform certain "consular and other
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functions" that relates to the promotion, protection and facilitation of Philippine
interests in Taiwan.16
At present, it is the MECO that oversees the rights and interests of Overseas
Filipino Workers (OFWs) in Taiwan; promotes the Philippines as a tourist and
investment destination for the Taiwanese; and facilitates the travel of Filipinos and
Taiwanese from Taiwan to the Philippines, and vice versa.17
Facts Leading to the Mandamus Petition
On 23 August 2010, petitioner sent a letter18 to the COA requesting for a "copy of
the latest financial and audit report" of the MECO invoking, for that purpose, his
"constitutional right to information on matters of public concern." The petitioner
made the request on the belief that the MECO, being under the "operational
supervision" of the Department of Trade and Industry (DTI), is a government
owned and controlled corporation (GOCC) and thus subject to the audit jurisdiction
of the COA.19
Petitioner’s letter was received by COA Assistant Commissioner Jaime P. Naranjo,
the following day.
On 25 August 2010, Assistant Commissioner Naranjo issued a
memorandum 20 referring the petitioner’s request to COA Assistant Commissioner
Emma M. Espina for "further disposition." In this memorandum, however, Assistant
Commissioner Naranjo revealed that the MECO was "not among the agencies
audited by any of the three Clusters of the Corporate Government Sector."21
On 7 September 2010, petitioner learned about the 25 August 2010 memorandum
and its contents.
Mandamus Petition
Taking the 25 August 2010 memorandum as an admission that the COA had never
audited and examined the accounts of the MECO, the petitioner filed the instant
petition for mandamus on 8 September 2010. Petitioner filed the suit in his
capacities as "taxpayer, concerned citizen, a member of the Philippine Bar and law
book author."22 He impleaded both the COA and the MECO.
Petitioner posits that by failing to audit the accounts of the MECO, the COA is
neglecting its duty under Section 2(1), Article IX-D of the Constitution to audit the
accounts of an otherwise bona fide GOCC or government instrumentality. It is the
adamant claim of the petitioner that the MECO is a GOCC without an original
charter or, at least, a government instrumentality, the funds of which partake the
nature of public funds.23
According to petitioner, the MECO possesses all the essential characteristics of a
GOCC and an instrumentality under the Executive Order No. (EO) 292, s. 1987 or
the Administrative Code: it is a non-stock corporation vested with governmental
functions relating to public needs; it is controlled by the government thru a board of
directors appointed by the President of the Philippines; and while not integrated
within the executive departmental framework, it is nonetheless under the
operational and policy supervision of the DTI.24 As petitioner substantiates:
1. The MECO is vested with government functions. It performs functions
that are equivalent to those of an embassy or a consulate of the Philippine
government.25 A reading of the authorized functions of the MECO as found
in EO No. 15, s. 2001, reveals that they are substantially the same
functions performed by the Department of Foreign Affairs (DFA), through
its diplomatic and consular missions, per the Administrative Code.26
2. The MECO is controlled by the government. It is the President of the
Philippines that actually appoints the directors of the MECO, albeit
indirectly, by way of "desire letters" addressed to the MECO’s board of
directors.27 An illustration of this exercise is the assumption by Mr. Antonio
Basilio as chairman of the board of directors of the MECO in 2001, which
was accomplished when former President Gloria Macapagal-Arroyo,
through a memorandum28 dated 20 February 2001, expressed her "desire"
to the board of directors of the MECO for the election of Mr. Basilio as
chairman.29
3. The MECO is under the operational and policy supervision of the DTI.
The MECO was placed under the operational supervision of the DTI by EO
No. 328, s. of 2004, and again under the policy supervision of the same
department by EO No. 426, s. 2005.30
To further bolster his position that the accounts of the MECO ought to be audited
by the COA, the petitioner calls attention to the practice, allegedly prevailing in the
United States of America, wherein the American Institute in Taiwan (AIT)—the
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counterpart entity of the MECO in the United States—is supposedly audited by that
country’s Comptroller General.31 Petitioner claims that this practice had been
confirmed in a decision of the United States Court of Appeals for the District of
Columbia Circuit, in the case of Wood, Jr., ex rel. United States of America v. The
American Institute in Taiwan, et al.32
The Position of the MECO
The MECO prays for the dismissal of the mandamus petition on procedural and
substantial grounds.
On procedure, the MECO argues that the mandamus petition was prematurely
filed.33
The MECO posits that a cause of action for mandamus to compel the performance
of a ministerial duty required by law only ripens once there has been a refusal by
the tribunal, board or officer concerned to perform such a duty.34The MECO claims
that there was, in this case, no such refusal either on its part or on the COA’s
because the petitioner never made any demand for it to submit to an audit by the
COA or for the COA to perform such an audit, prior to filing the instant mandamus
petition.35 The MECO further points out that the only "demand" that the petitioner
made was his request to the COA for a copy of the MECO’s latest financial and
audit report— which request was not even finally disposed of by the time the
instant petition was filed.36
On the petition’s merits, the MECO denies the petitioner’s claim that it is a GOCC
or a government instrumentality.37While performing public functions, the MECO
maintains that it is not owned or controlled by the government, and its funds are
private funds.38 The MECO explains:
1. It is not owned or controlled by the government. Contrary to the
allegations of the petitioner, the President of the Philippines does not
appoint its board of directors.39 The "desire letter" that the President
transmits is merely recommendatory and not binding on the
corporation.40 As a corporation organized under the Corporation Code,
matters relating to the election of its directors and officers, as well as its
membership, are governed by the appropriate provisions of the said code,
its articles of incorporation and its by-laws.41 Thus, it is the directors who
elect the corporation’s officers; the members who elect the directors; and
the directors who admit the members by way of a unanimous resolution.
All of its officers, directors, and members are private individuals and are
not government officials.42
2. The government merely has policy supervision over it. Policy
supervision is a lesser form of supervision wherein the government’s
oversight is limited only to ensuring that the corporation’s activities are in
tune with the country’s commitments under the One China policy of the
PROC.43 The day-to-day operations of the corporation, however, remain to
be controlled by its duly elected board of directors.44
The MECO emphasizes that categorizing it as a GOCC or a government
instrumentality can potentially violate the country’s commitment to the One China
policy of the PROC.45 Thus, the MECO cautions against applying to the present
mandamus petition the pronouncement in the Wood decision regarding the alleged
auditability of the AIT in the United States.46
The Position of the COA
The COA, on the other hand, advances that the mandamus petition ought to be
dismissed on procedural grounds and on the ground of mootness.
The COA argues that the mandamus petition suffers from the following procedural
defects:
1. The petitioner lacks locus standi to bring the suit. The COA claims that
the petitioner has not shown, at least in a concrete manner, that he had
been aggrieved or prejudiced by its failure to audit the accounts of the
MECO.47
2. The petition was filed in violation of the doctrine of hierarchy of courts.
The COA faults the filing of the instant mandamus petition directly with this
Court, when such petition could have very well been presented, at the first
instance, before the Court of Appeals or any Regional Trial Court.48 The
COA claims that the petitioner was not able to provide compelling reasons
to justify a direct resort to the Supreme Court.49
At any rate, the COA argues that the instant petition already became moot when
COA Chairperson Maria Gracia M. Pulido-Tan (Pulido-Tan) issued Office Order
No. 2011-69850 on 6 October 2011.51 The COA notes that under Office Order No.
2011-698, Chairperson Pulido-Tan already directed a team of auditors to proceed
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to Taiwan, specifically for the purpose of auditing the accounts of, among other
government agencies based therein, the MECO.52
In conceding that it has audit jurisdiction over the accounts of the MECO, however,
the COA clarifies that it does not consider the former as a GOCC or a government
instrumentality. On the contrary, the COA maintains that the MECO is a non-
governmental entity.53
The COA argues that, despite being a non-governmental entity, the MECO may
still be audited with respect to the "verification fees" for overseas employment
documents that it collects from Taiwanese employers on behalf of the DOLE. 54 The
COA claims that, under Joint Circular No. 3-99,55 the MECO is mandated to remit
to the Department of Labor and Employment (DOLE) a portion of such "verification
fees."56 The COA, therefore, classifies the MECO as a non-governmental entity
"required to pay xxx government share" subject to a partial audit of its accounts
under Section 26 of the Presidential Decree No. 1445 or the State Audit Code of
the Philippines (Audit Code).57
OUR RULING
We grant the petition in part. We declare that the MECO is a non-governmental
entity. However, under existing laws, the accounts of the MECO pertaining to the
"verification fees" it collects on behalf of the DOLE as well as the fees it was
authorized to collect under Section 2(6) of EO No. 15, s. 2001, are subject to the
audit jurisdiction of the COA. Such fees pertain to the government and should be
audited by the COA.
I presupposing the commission of a grave violation of the Constitution and involving
We begin with the preliminary issues.
Mootness of Petition
The first preliminary issue relates to the alleged mootness of the instant
mandamus petition, occasioned by the COA’s issuance of Office Order No. 2011-
698. The COA claims that by issuing Office Order No. 2011-698, it had already
conceded its jurisdiction over the accounts of the MECO and so fulfilled the
objective of the instant petition.58 The COA thus urges that the instant petition be
dismissed for being moot and academic.59
We decline to dismiss the mandamus petition on the ground of mootness.
A case is deemed moot and academic when, by reason of the occurrence of a
supervening event, it ceases to present any justiciable controversy. 60 Since they
lack an actual controversy otherwise cognizable by courts, moot cases are, as a
rule, dismissible.61
The rule that requires dismissal of moot cases, however, is not absolute. It is
subject to exceptions. In David v. Macapagal-Arroyo,62 this Court comprehensively
captured these exceptions scattered throughout our jurisprudence:
The "moot and academic" principle is not a magical formula that can automatically
dissuade the courts in resolving a case. Courts will decide cases, otherwise moot
and academic, if: first, there is a grave violation of the Constitution; 63second, the
exceptional character of the situation and the paramount public interest is
involved;64 third, when constitutional issue raised requires formulation of controlling
principles to guide the bench, the bar, and the public;65and fourth, the case is
capable of repetition yet evading review.66
In this case, We find that the issuance by the COA of Office Order No. 2011-698
indeed qualifies as a supervening event that effectively renders moot and
academic the main prayer of the instant mandamus petition. A writ of mandamus
to compel the COA to audit the accounts of the MECO would certainly be a mere
superfluity, when the former had already obliged itself to do the same.
Be that as it may, this Court refrains from dismissing outright the petition. We
believe that the mandamus petition was able to craft substantial issues
paramount public interest, which need to be resolved nonetheless:
First. The petition makes a serious allegation that the COA had been remiss in its
constitutional or legal duty to audit and examine the accounts of an otherwise
auditable entity in the MECO.
Second. There is paramount public interest in the resolution of the issue
concerning the failure of the COA to audit the accounts of the MECO. The
propriety or impropriety of such a refusal is determinative of whether the COA was
able to faithfully fulfill its constitutional role as the guardian of the public treasury, in
which any citizen has an interest.
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Third. There is also paramount public interest in the resolution of the issue
regarding the legal status of the MECO; a novelty insofar as our jurisprudence is
concerned. We find that the status of the MECO—whether it may be considered as
a government agency or not—has a direct bearing on the country’s commitment to
the One China policy of the PROC.67
An allegation as serious as a violation of a constitutional or legal duty, coupled with
the pressing public interest in the resolution of all related issues, prompts this
Court to pursue a definitive ruling thereon, if not for the proper guidance of the
government or agency concerned, then for the formulation of controlling principles
for the education of the bench, bar and the public in general. 68 For this purpose,
the Court invokes its symbolic function.69
If the foregoing reasons are not enough to convince, We still add another:
Assuming that the allegations of neglect on the part of the COA were true, Office
Order No. 2011-698 does not offer the strongest certainty that they would not be
replicated in the future. In the first place, Office Order No. 2011-698 did not state
any legal justification as to why, after decades of not auditing the accounts of the
MECO, the COA suddenly decided to do so. Neither does it state any
determination regarding the true status of the MECO. The justifications provided by
the COA, in fact, only appears in the memorandum 70 it submitted to this Court for
purposes of this case.
Thus, the inclusion of the MECO in Office Order No. 2011-698 appears to be
entirely dependent upon the judgment of the incumbent chairperson of the COA;
susceptible of being undone, with or without reason, by her or even her successor.
Hence, the case now before this Court is dangerously capable of being repeated
yet evading review.
Verily, this Court should not dismiss the mandamus petition on the ground of
mootness.
Standing of Petitioner
The second preliminary issue is concerned with the standing of the petitioner to file
the instant mandamus petition. The COA claims that petitioner has none, for the
latter was not able to concretely establish that he had been aggrieved or
prejudiced by its failure to audit the accounts of the MECO.71
Related to the issue of lack of standing is the MECO’s contention that petitioner
has no cause of action to file the instant mandamus petition. The MECO faults
petitioner for not making any demand for it to submit to an audit by the COA or for
the COA to perform such an audit, prior to filing the instant petition.72
We sustain petitioner’s standing, as a concerned citizen, to file the instant petition.
The rules regarding legal standing in bringing public suits, or locus standi, are
already well-defined in our case law. Again, We cite David, which summarizes
jurisprudence on this point:73
By way of summary, the following rules may be culled from the cases decided by
this Court.1a\^/phi1 Taxpayers, voters, concerned citizens, and legislators may be
accorded standing to sue, provided that the following requirements are met:
(1) the cases involve constitutional issues;
(2) for taxpayers, there must be a claim of illegal disbursement of public
funds or that the tax measure is unconstitutional;
(3) for voters, there must be a showing of obvious interest in the validity of
the election law in question;
(4) for concerned citizens, there must be a showing that the issues raised
are of transcendental importance which must be settled early; and
(5) for legislators, there must be a claim that the official action complained
of infringes upon their prerogatives as legislators.
We rule that the instant petition raises issues of transcendental importance,
involved as they are with the performance of a constitutional duty, allegedly
neglected, by the COA. Hence, We hold that the petitioner, as a concerned citizen,
has the requisite legal standing to file the instant mandamus petition.
To be sure, petitioner does not need to make any prior demand on the MECO or
the COA in order to maintain the instant petition. The duty of the COA sought to be
compelled by mandamus, emanates from the Constitution and law, which explicitly
require, or "demand," that it perform the said duty. To the mind of this Court,
petitioner already established his cause of action against the COA when he
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alleged that the COA had neglected its duty in violation of the Constitution and the
law.
Principle of Hierarchy of Courts
The last preliminary issue is concerned with the petition’s non-observance of the
principle of hierarchy of courts. The COA assails the filing of the instant mandamus
petition directly with this Court, when such petition could have very well been
presented, at the first instance, before the Court of Appeals or any Regional Trial
Court.74 The COA claims that the petitioner was not able to provide compelling
reasons to justify a direct resort to the Supreme Court.75
In view of the transcendental importance of the issues raised in the mandamus
petition, as earlier mentioned, this Court waives this last procedural issue in favor
of a resolution on the merits.76
II
To the merits of this petition, then.
The single most crucial question asked by this case is whether the COA is, under
prevailing law, mandated to audit the accounts of the MECO. Conversely, are the
accounts of the MECO subject to the audit jurisdiction of the COA?
Law, of course, identifies which accounts of what entities are subject to the audit
jurisdiction of the COA.
Under Section 2(1) of Article IX-D of the Constitution,77 the COA was vested with
the "power, authority and duty" to "examine, audit and settle" the "accounts" of the
following entities:
1. The government, or any of its subdivisions, agencies and
instrumentalities;
2. GOCCs with original charters;
3. GOCCs without original charters;
4. Constitutional bodies, commissions and offices that have been granted
fiscal autonomy under the Constitution; and
5. Non-governmental entities receiving subsidy or equity, directly or
indirectly, from or through the government, which are required by law or
the granting institution to submit to the COA for audit as a condition of
subsidy or equity.78
The term "accounts" mentioned in the subject constitutional provision pertains to
the "revenue," "receipts," "expenditures" and "uses of funds and property" of the
foregoing entities.79
Complementing the constitutional power of the COA to audit accounts of "non-
governmental entities receiving subsidy or equity xxx from or through the
government" is Section 29(1)80 of the Audit Code, which grants the COA visitorial
authority over the following non-governmental entities:
1. Non-governmental entities "subsidized by the government";
2. Non-governmental entities "required to pay levy or government share";
3. Non-governmental entities that have "received counterpart funds from
the government"; and
4. Non-governmental entities "partly funded by donations through the
government."
Section 29(1) of the Audit Code, however, limits the audit of the foregoing non-
governmental entities only to "funds xxx coming from or through the
government."81 This section of the Audit Code is, in turn, substantially reproduced
in Section 14(1), Book V of the Administrative Code.82
In addition to the foregoing, the Administrative Code also empowers the COA to
examine and audit "the books, records and accounts" of public utilities "in
connection with the fixing of rates of every nature, or in relation to the proceedings
of the proper regulatory agencies, for purposes of determining franchise tax."83
Both petitioner and the COA claim that the accounts of the MECO are within the
audit jurisdiction of the COA, but vary on the extent of the audit and on what type
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of auditable entity the MECO is. The petitioner posits that all accounts of the
MECO are auditable as the latter is a bona fide GOCC or government
instrumentality.84 On the other hand, the COA argues that only the accounts of the
MECO that pertain to the "verification fees" it collects on behalf of the DOLE are
auditable because the former is merely a non-governmental entity "required to pay
xxx government share" per the Audit Code.85
We examine both contentions.
The MECO Is Not a GOCC or
Government Instrumentality
We start with the petitioner’s contention.
Petitioner claims that the accounts of the MECO ought to be audited by the COA
because the former is a GOCC or government instrumentality. Petitioner points out
that the MECO is a non-stock corporation "vested with governmental functions
relating to public needs"; it is "controlled by the government thru a board of
directors appointed by the President of the Philippines"; and it operates "outside of
the departmental framework," subject only to the "operational and policy
supervision of the DTI."86 The MECO thus possesses, petitioner argues, the
essential characteristics of a bona fide GOCC and government instrumentality. 87
We take exception to petitioner’s characterization of the MECO as a GOCC or
government instrumentality. The MECO is not a GOCC or government
instrumentality.
Government instrumentalities are agencies of the national government that, by
reason of some "special function or jurisdiction" they perform or exercise, are
allotted "operational autonomy" and are "not integrated within the department
framework."88 Subsumed under the rubric "government instrumentality" are the
following entities:89
1. regulatory agencies,
2. chartered institutions,
3. government corporate entities or government instrumentalities with
corporate powers (GCE/GICP),90 and
4. GOCCs
The Administrative Code defines a GOCC:91
(13) Government-owned or controlled corporation refers to any agency organized
as a stock or non-stock corporation, vested with functions relating to public needs
whether governmental or proprietary in nature, and owned by the Government
directly or through its instrumentalities either wholly, or, where applicable as in the
case of stock corporations, to the extent of at least fifty-one (51) per cent of its
capital stock: x x x.
The above definition is, in turn, replicated in the more recent Republic Act No.
10149 or the GOCC Governance Act of 2011, to wit:92
(o) Government-Owned or -Controlled Corporation (GOCC) refers to any agency
organized as a stock or non-stock corporation, vested with functions relating to
public needs whether governmental or proprietary in nature, and owned by the
Government of the Republic of the Philippines directly or through its
instrumentalities either wholly or, where applicable as in the case of stock
corporations, to the extent of at least a majority of its outstanding capital stock: x x
x.
GOCCs, therefore, are "stock or non-stock" corporations "vested with functions
relating to public needs" that are "owned by the Government directly or through its
instrumentalities."93 By definition, three attributes thus make an entity a GOCC:
first, its organization as stock or non-stock corporation;94 second, the public
character of its function; and third, government ownership over the same.
Possession of all three attributes is necessary to deem an entity a GOCC.
In this case, there is not much dispute that the MECO possesses the first and
second attributes. It is the third attribute, which the MECO lacks.
The MECO Is Organized as a Non-Stock Corporation
The organization of the MECO as a non-stock corporation cannot at all be denied.
Records disclose that the MECO was incorporated as a non-stock corporation
under the Corporation Code on 16 December 1977.95 The incorporators of the
MECO were Simeon R. Roxas, Florencio C. Guzon, Manuel K. Dayrit, Pio K. Luz
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and Eduardo B. Ledesma, who also served as the corporation’s original members
and directors.96
The purposes for which the MECO was organized also establishes its non-profit
character, to wit:97
1. To establish and develop the commercial and industrial interests of
Filipino nationals here and abroad and assist on all measures designed to
promote and maintain the trade relations of the country with the citizens of
other foreign countries;
2. To receive and accept grants and subsidies that are reasonably
necessary in carrying out the corporate purposes provided they are not
subject to conditions defeatist for or incompatible with said purpose;
3. To acquire by purchase, lease or by any gratuitous title real and
personal properties as may be necessary for the use and need of the
corporation, and in like manner when they are
4. To do and perform any and all acts which are deemed reasonably
necessary to carry out the purposes. (Emphasis supplied)
The purposes for which the MECO was organized are somewhat analogous to
those of a trade, business or industry chamber,98 but only on a much larger scale
i.e., instead of furthering the interests of a particular line of business or industry
within a local sphere, the MECO seeks to promote the general interests of the
Filipino people in a foreign land.
Finally, it is not disputed that none of the income derived by the MECO is
distributable as dividends to any of its members, directors or officers.
Verily, the MECO is organized as a non-stock corporation.
The MECO Performs Functions with a Public Aspect.
The public character of the functions vested in the MECO cannot be doubted
either. Indeed, to a certain degree, the functions of the MECO can even be said to
partake of the nature of governmental functions. As earlier intimated, it is the
MECO that, on behalf of the people of the Philippines, currently facilitates unofficial
relations with the people in Taiwan.
Consistent with its corporate purposes, the MECO was "authorized" by the
Philippine government to perform certain "consular and other functions" relating to
the promotion, protection and facilitation of Philippine interests in Taiwan. 99The full
extent of such authorized functions are presently detailed in Sections 1 and 2 of
EO No. 15, s. 2001:
SECTION 1. Consistent with its corporate purposes and subject to the conditions
stated in Section 3 hereof, MECO is hereby authorized to assist in the
performance of the following functions:
1. Formulation and implementation of a program to attract and
promote investments from Taiwan to Philippine industries and
businesses, especially in manufacturing, tourism, construction and
other preferred areas of investments;
2. Promotion of the export of Philippine products and Filipino
manpower services, including Philippine management services, to
Taiwan;
3. Negotiation and/or assistance in the negotiation and conclusion
of agreements or other arrangements concerning trade,
investment, economic cooperation, technology transfer, banking
and finance, scientific, cultural, educational and other modes of
cooperative endeavors between the Philippines and Taiwan, on a
people-to-people basis, in accordance with established rules and
regulations;
4. Reporting on, and identification of, employment and business
opportunities in Taiwan for the promotion of Philippine exports,
manpower and management services, and tourism;
5. Dissemination in Taiwan of information on the Philippines,
especially in the fields of trade, tourism, labor, economic
cooperation, and cultural, educational and scientific endeavors;
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 6. Conduct of periodic assessment of market conditions in Taiwan,
including submission of trade statistics and commercial reports for
use of Philippine industries and businesses; and
7. Facilitation, fostering and cultivation of cultural, sports, social,
and educational exchanges between the peoples of the
Philippines and Taiwan.
SECTION 2. In addition to the above-mentioned authority and subject to the
conditions stated in Section 3 hereof, MECO, through its branch offices in Taiwan,
is hereby authorized to perform the following functions:
1. Issuance of temporary visitors’ visas and transit and crew list
visas, and such other visa services as may be authorized by the
Department of Foreign Affairs;
2. Issuance, renewal, extension or amendment of passports of
Filipino citizens in accordance with existing regulations, and
provision of such other passport services as may be required
under the circumstances;
3. Certification or affirmation of the authenticity of documents
submitted for authentication;
4. Providing translation services;
5. Assistance and protection to Filipino nationals and other
legal/juridical persons working or residing in Taiwan, including
making representations to the extent allowed by local and
international law on their behalf before civil and juridical authorities
of Taiwan; and
6. Collection of reasonable fees on the first four (4) functions
enumerated above to defray the cost of its operations.
A perusal of the above functions of the MECO reveals its uncanny similarity to
some of the functions typically performed by the DFA itself, through the latter’s
diplomatic and consular missions.100 The functions of the MECO, in other words,
are of the kind that would otherwise be performed by the Philippines’ own
diplomatic and consular organs, if not only for the government’s acquiescence that
they instead be exercised by the MECO.
Evidently, the functions vested in the MECO are impressed with a public aspect.
The MECO Is Not Owned or Controlled by the Government Organization as a non-
stock corporation and the mere performance of functions with a public aspect,
however, are not by themselves sufficient to consider the MECO as a GOCC. In
order to qualify as a GOCC, a corporation must also, if not more importantly, be
owned by the government.
The government owns a stock or non-stock corporation if it has controlling interest
in the corporation. In a stock corporation, the controlling interest of the government
is assured by its ownership of at least fifty-one percent (51%) of the corporate
capital stock.101 In a non-stock corporation, like the MECO, jurisprudence teaches
that the controlling interest of the government is affirmed when "at least majority of
the members are government officials holding such membership by appointment or
designation"102 or there is otherwise "substantial participation of the government in
the selection" of the corporation’s governing board.103
In this case, the petitioner argues that the government has controlling interest in
the MECO because it is the President of the Philippines that indirectly appoints the
directors of the corporation.104 The petitioner claims that the President appoints
directors of the MECO thru "desire letters" addressed to the corporation’s
board.105 As evidence, the petitioner cites the assumption of one Mr. Antonio
Basilio as chairman of the board of directors of the MECO in 2001, which was
allegedly accomplished when former President Macapagal-Arroyo, through a
memorandum dated 20 February 2001, expressed her "desire" to the board of
directors of the MECO for the election of Mr. Basilio as chairman.106
The MECO, however, counters that the "desire letters" that the President transmits
are merely recommendatory and not binding on it.107 The MECO maintains that, as
a corporation organized under the Corporation Code, matters relating to the
election of its directors and officers, as well as its membership, are ultimately
governed by the appropriate provisions of the said code, its articles of
incorporation and its by-laws.108
As between the contrasting arguments, We find the contention of the MECO to be
the one more consistent with the law.
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The fact of the incorporation of the MECO under the Corporation Code is key. The
MECO was correct in postulating that, as a corporation organized under the
Corporation Code, it is governed by the appropriate provisions of the said code, its
articles of incorporation and its by-laws. In this case, it is the by-laws109 of the
MECO that stipulates that its directors are elected by its members; its officers are
elected by its directors; and its members, other than the original incorporators, are
admitted by way of a unanimous board resolution, to wit:
SECTION II. MEMBERSHIP
Article 2. Members shall be classified as (a) Regular and (b) Honorary.
(a) Regular members – shall consist of the original incorporators and such
other members who, upon application for membership, are unanimously
admitted by the Board of Directors.
(b) Honorary member – A person of distinction in business who as
sympathizer of the objectives of the corporation, is invited by the Board to
be an honorary member.
SECTION III. BOARD OF DIRECTORS
Article 3. At the first meeting of the regular members, they shall organize and
constitute themselves as a Board composed of five (5) members, including its
Chairman, each of whom as to serve until such time as his own successor shall
have been elected by the regular members in an election called for the purpose.
The number of members of the Board shall be increased to seven (7) when
circumstances so warrant and by means of a majority vote of the Board members
and appropriate application to and approval by the Securities and Exchange
Commission. Unless otherwise provided herein or by law, a majority vote of all
Board members present shall be necessary to carry out all Board resolutions.
During the same meeting, the Board shall also elect its own officers, including the
designation of the principal officer who shall be the Chairman. In line with this, the
Chairman shall also carry the title Chief Executive Officer. The officer who shall
head the branch or office for the agency that may be established abroad shall have
the title of Director and Resident Representative. He will also be the Vice-
Chairman. All other members of the Board shall have the title of Director.
xxxx
SECTION IV. EXECUTIVE COMMITTEE
Article 5. There shall be established an Executive Committee composed of at least
three (3) members of the Board. The members of the Executive Committee shall
be elected by the members of the Board among themselves.
xxxx
SECTION VI. OFFICERS: DUTIES, COMPENSATION
Article 8. The officers of the corporation shall consist of a Chairman of the Board,
Vice-Chairman, Chief Finance Officer, and a Secretary. Except for the Secretary,
who is appointed by the Chairman of the Board, other officers and employees of
the corporation shall be appointed by the Board.
The Deputy Representative and other officials and employees of a branch office or
agency abroad are appointed solely by the Vice Chairman and Resident
Representative concerned. All such appointments however are subject to
ratification by the Board.
It is significant to note that none of the original incorporators of the MECO were
shown to be government officials at the time of the corporation’s organization.
Indeed, none of the members, officers or board of directors of the MECO, from its
incorporation up to the present day, were established as government appointees
or public officers designated by reason of their office. There is, in fact, no law or
executive order that authorizes such an appointment or designation. Hence, from a
strictly legal perspective, it appears that the presidential "desire letters" pointed out
by petitioner—if such letters even exist outside of the case of Mr. Basilio—are, no
matter how strong its persuasive effect may be, merely recommendatory.
The MECO Is Not a Government Instrumentality; It Is a Sui Generis Entity.
The categorical exclusion of the MECO from a GOCC makes it easier to exclude
the same from any other class of government instrumentality. The other
government instrumentalities i.e., the regulatory agencies, chartered institutions
and GCE/GICP are all, by explicit or implicit definition, creatures of the law. 110 The
MECO cannot be any other instrumentality because it was, as mentioned earlier,
merely incorporated under the Corporation Code.
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Hence, unless its legality is questioned, and in this case it was not, the fact that the
MECO is operating under the policy supervision of the DTI is no longer a relevant
issue to be reckoned with for purposes of this case.
For whatever it is worth, however, and without justifying anything, it is easy enough
for this Court to understand the rationale, or necessity even, of the executive
branch placing the MECO under the policy supervision of one of its agencies.
It is evident, from the peculiar circumstances surrounding its incorporation, that the
MECO was not intended to operate as any other ordinary corporation. And it is not.
Despite its private origins, and perhaps deliberately so, the MECO was
"entrusted"111 by the government with the "delicate and
precarious"112 responsibility of pursuing "unofficial"113 relations with the people of a
foreign land whose government the Philippines is bound not to recognize. The
intricacy involved in such undertaking is the possibility that, at any given time in
fulfilling the purposes for which it was incorporated, the MECO may find itself
engaged in dealings or activities that can directly contradict the Philippines’
commitment to the One China policy of the PROC. Such a scenario can only truly
be avoided if the executive department exercises some form of oversight, no
matter how limited, over the operations of this otherwise private entity.
Indeed, from hindsight, it is clear that the MECO is uniquely situated as compared
with other private corporations. From its over-reaching corporate objectives, its
special duty and authority to exercise certain consular functions, up to the
oversight by the executive department over its operations—all the while
maintaining its legal status as a non-governmental entity—the MECO is, for all
intents and purposes, sui generis.
Certain Accounts of the MECO May
Be Audited By the COA.
We now come to the COA’s contention.
The COA argues that, despite being a non-governmental entity, the MECO may
still be audited with respect to the "verification fees" for overseas employment
documents that the latter collects from Taiwanese employers on behalf of the
DOLE.114 The COA claims that, under Joint Circular No. 3-99, the MECO is
mandated to remit to the national government a portion of such "verification
fees."115 The COA, therefore, classifies the MECO as a non-governmental entity
"required to pay xxx government share" per the Audit Code. 116
We agree that the accounts of the MECO pertaining to its collection of "verification
fees" is subject to the audit jurisdiction of the COA. However, We digress from the
view that such accounts are the only ones that ought to be audited by the COA.
Upon careful evaluation of the information made available by the records vis-à-vis
the spirit and the letter of the laws and executive issuances applicable, We find
that the accounts of the MECO pertaining to the fees it was authorized to collect
under Section 2(6) of EO No. 15, s. 2001, are likewise subject to the audit
jurisdiction of the COA.
Verification Fees Collected by the MECO
In its comment,117 the MECO admitted that roughly 9% of its income is derived
from its share in the "verification fees" for overseas employment documents it
collects on behalf of the DOLE.
The "verification fees" mentioned here refers to the "service fee for the verification
of overseas employment contracts, recruitment agreement or special powers of
attorney" that the DOLE was authorized to collect under Section 7 of EO No.
1022,118 which was issued by President Ferdinand E. Marcos on 1 May 1985.
These fees are supposed to be collected by the DOLE from the foreign employers
of OFWs and are intended to be used for "the promotion of overseas employment
and for welfare services to Filipino workers within the area of jurisdiction of
[concerned] foreign missions under the administration of the [DOLE]."119
Joint Circular 3-99 was issued by the DOLE, DFA, the Department of Budget
Management, the Department of Finance and the COA in an effort to implement
Section 7 of Executive Order No. 1022.120 Thus, under Joint Circular 3-99, the
following officials have been tasked to be the "Verification Fee Collecting Officer"
on behalf of the DOLE:121
1. The labor attaché or duly authorized overseas labor officer at a given
foreign post, as duly designated by the DOLE Secretary;
2. In foreign posts where there is no labor attaché or duly authorized
overseas labor officer, the finance officer or collecting officer of the DFA
duly deputized by the DOLE Secretary as approved by the DFA Secretary;
3. In the absence of such finance officer or collecting officer, the alternate
duly designated by the head of the foreign post.
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Since the Philippines does not maintain an official post in Taiwan, however, the
DOLE entered into a "series" of Memorandum of Agreements with the MECO,
which made the latter the former’s collecting agent with respect to the "verification
fees" that may be due from Taiwanese employers of OFWs.122 Under the 27
February 2004 Memorandum of Agreement between DOLE and the MECO, the
"verification fees" to be collected by the latter are to be allocated as follows: (a)
US$ 10 to be retained by the MECO as administrative fee, (b) US $10 to be
remitted to the DOLE, and (c) US$ 10 to be constituted as a common fund of the
MECO and DOLE.123
Evidently, the entire "verification fees" being collected by the MECO are
receivables of the DOLE.124 Such receipts pertain to the DOLE by virtue of Section
7 of EO No. 1022.
Consular Fees Collected by the MECO
Aside from the DOLE "verification fees," however, the MECO also collects
"consular fees," or fees it collects from the exercise of its delegated consular
functions.
The authority behind "consular fees" is Section 2(6) of EO No. 15, s. 2001. The
said section authorizes the MECO to collect "reasonable fees" for its performance
of the following consular functions:
1. Issuance of temporary visitors’ visas and transit and crew list visas, and
such other visa services as may be authorized by the DFA;
2. Issuance, renewal, extension or amendment of passports of Filipino
citizens in accordance with existing regulations, and provision of such
other passport services as may be required under the circumstances;
3. Certification or affirmation of the authenticity of documents submitted for
authentication; and
4. Providing translation services.
Evidently, and just like the peculiarity that attends the DOLE "verification fees,"
there is no consular office for the collection of the "consular fees." Thus, the
authority for the MECO to collect the "reasonable fees," vested unto it by the
executive order.
The "consular fees," although held and expended by the MECO by virtue of EO
No. 15, s. 2001, are, without question, derived from the exercise by the MECO of
consular functions—functions it performs by and only through special authority
from the government. There was never any doubt that the visas, passports and
other documents that the MECO issues pursuant to its authorized functions still
emanate from the Philippine government itself.
Such fees, therefore, are received by the MECO to be used strictly for the purpose
set out under EO No. 15, s. 2001. They must be reasonable as the authorization
requires. It is the government that has ultimate control over the disposition of the
"consular fees," which control the government did exercise when it provided in
Section 2(6) of EO No. 15, s. 2001 that such funds may be kept by the MECO "to
defray the cost of its operations."
The Accounts of the MECO Pertaining to the Verification Fees and Consular Fees
May Be Audited by the COA.
Section 14(1), Book V of the Administrative Code authorizes the COA to audit
accounts of non-governmental entities "required to pay xxx or have government
share" but only with respect to "funds xxx coming from or through the government."
This provision of law perfectly fits the MECO:
First. The MECO receives the "verification fees" by reason of being the collection
agent of the DOLE—a government agency. Out of its collections, the MECO is
required, by agreement, to remit a portion thereof to the DOLE. Hence, the MECO
is accountable to the government for its collections of such "verification fees" and,
for that purpose, may be audited by the COA.
Second. Like the "verification fees," the "consular fees" are also received by the
MECO through the government, having been derived from the exercise of consular
functions entrusted to the MECO by the government. Hence, the MECO remains
accountable to the government for its collections of "consular fees" and, for that
purpose, may be audited by the COA.
Tersely put, the 27 February 2008 Memorandum of Agreement between the DOLE
and the MECO and Section 2(6) of EO No. 15, s. 2001, vis-à-vis, respectively, the
"verification fees" and the "consular fees," grant and at the same time limit the
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authority of the MECO to collect such fees. That grant and limit require the audit by
the COA of the collections thereby generated.
Conclusion
The MECO is not a GOCC or government instrumentality. It is a sui generis private
entity especially entrusted by the government with the facilitation of unofficial
relations with the people in Taiwan without jeopardizing the country’s faithful
commitment to the One China policy of the PROC. However, despite its non-
governmental character, the MECO handles government funds in the form of the
"verification fees" it collects on behalf of the DOLE and the "consular fees" it
collects under Section 2(6) of EO No. 15, s. 2001. Hence, under existing laws, the
accounts of the MECO pertaining to its collection of such "verification fees" and
"consular fees" should be audited by the COA.
WHEREFORE, premises considered, the petition is PARTIALLY GRANTED. The
Manila Economic and Cultural Office is hereby declared a non-governmental
entity. However, the accounts of the Manila Economic and Cultural Office
pertaining to: the verification fees contemplated by Section 7 of Executive Order
No. 1022 issued 1 May 1985, that the former collects on behalf of the Department
of Labor and Employment, and the fees it was authorized to collect under Section
2(6) of Executive Order No. 15 issued 16 May 2001, are subject to the audit
jurisdiction of the COA.
No costs.
SO ORDERED.
G.R. No. 211362 February 24, 2015
FIRST CLASS CADET ALDRIN JEFF P. CUDIA of the Philippine Military
Academy, represented by his father RENATO P. CUDIA, who also acts on his
own behalf, and BERTENI CATALUNA CAUSING, Petitioners,
vs.
THE SUPERINTENDENT OF THE PHILIPPINE MILITARY ACADEMY (PMA),
THE HONOR COMMITTEE (HC) OF 2014 OF THE PMA and HC MEMBERS,
and the CADET REVIEW AND APPEALS BOARD (CRAB),Respondents.
x-----------------------x
FILIPINA P. CUDIA, in behalf of CADET FIRST CLASS ALDRIN JEFF P.
CUDIA, and on her own behalf,Petitioner-Intervenor.
DECISION
PERALTA, J.:
The true test of a cadet's character as a leader rests on his personal commitment
to uphold what is morally and ethically righteous at the most critical and trying
times, and at the most challenging circumstances. When a cadet must face a
dilemma between what is true and right as against his security, well-being,
pleasures and comfort, or dignity, what is at stake is his honor and those that
[define] his values. A man of an honorable character does not think twice and
chooses the fore. This is the essence of and. the Spirit of the Honor Code - it is
championing truth and righteousness even if it may mean the surrender of one's
basic rights and privileges.1
The Procedural Antecedents
Six days prior to the March 16, 2014 graduation ceremonies of the Philippine
Military Academy (PMA), petitioners Renato P. Cudia, acting for himself and in
behalf of his son, Cadet First Class Aldrin Jeff P. Cudia (Cadet JCL Cudia), and
Berteni Catalufta Causing filed this petition for certiorari, prohibition, and
mandamus with application for extremely urgent temporary restraining order
(TRO).2
In a Resolution dated March 1 7, 2014, the Court denied the prayer for TRO and
instead, required respondents to file their comment on the petition. 3
On March 25, 2014, Filipina P. Cudia, acting for herself and in behalf of her son
Cadet 1 CL Cudia, filed a motion for leave to intervene, attaching thereto the
petition-in-intervention.4 Per Resolution dated March 31, 2014, the Court granted
the motion and resolved to await respondents' comment on the petition. 5
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A manifestation was then filed by petitioners on April 3, 2014, recommending the
admission of the petition-in-intervention and adopting it as an integral part of their
petition.6 On May 20, 2014, petitioner-intervenor filed a manifestation with motion
for leave to admit the Final Investigation Report of the Commission on Human
Rights (CHR) dated April 25, 2014.7 The Report8 was relative to CHR-CAR Case
No. 2014-0029 filed by the spouses Renato and Filipina Cudia (Spouses Cudia),
for themselves and in behalf of their son, against the PMA Honor Committee (HC)
members and Major Vladimir P. Gracilla (Maj. Gracilla)9 for violation of Cadet lCL
Cudia's rights to due process, education, and privacy of communication.
Subsequently, on June 3, 2014, petitioners filed a motion for leave to adopt the
submission of the CHR Report.10 The manifestation was granted and the motion
was noted by the Court in its Resolution dated July 7, 2014.
After filing three motions for extension of time,11 respondents filed their
Consolidated Comment12 on June 19, 2014. In a motion, petitioner-intervenor filed
a Reply, which was later adopted by petitioners.13 Submitted as Annex "A" of the
Reply was a copy of the CHR Resolution dated May 22, 2014 regarding CHR-CAR
Case No. 2014-0029.14 We noted and granted the same on August 11, 2014 and
October 13, 2014.
Petitioner-intervenor twice filed a manifestation with motion to submit the case for
early resolution,15 which the Court noted in a Resolution dated August 11, 2014
and October 3, 2014.16
The Facts
Cadet 1 CL Cudia was a member of Siklab Diwa Class of 2014 of the PMA, the
country's premiere military academy located at Fort Gregorio del Pilar in Baguio
City. He belonged to the "A" Company and was the Deputy Baron of his class. As
claimed by petitioners and petitioner-intervenor (hereinafter collectively called
"petitioners," unless otherwise indicated), he was supposed to graduate with
honors as the class salutatorian, receive the Philippine Navy Saber as the top
Navy cadet graduate, and be commissioned as an ensign of the Philippine Navy.
On November 14, 2013, the combined classes of the Navy and Air Force 1 CL
cadets had a lesson examination (LE) on Operations Research (OR432) under Dr.
Maria Monica C. Costales (Dr. Costales) at the PMAFI Room. Per published
schedule from the Headquarters Academic Group, the 4th period class in OR432
was from 1 :30-3:00 p.m. (1330H-1500H), while the 5th period class in ENG412
was from 3:05-4:05 p.m. (1505H-1605H).
Five days after, Professor Juanita Berong (Prof. Berong) of the 5th period class
issued a Delinquency Report (DR) against Cadet 1 CL Cudia because he was
"[/]ate for two (2) minutes in his Eng 412 class x x x. "17 Cadets 1 CL Narciso,
Arcangel, Miranda, Pontillas, Diaz, Otila, and Dela Cruz were also reported late for
five minutes.18
On December 4, 2013, the DRs reached the Department of Tactical Officers. They
were logged and transmitted to the Company Tactical Officers ( CTO) for
explanation of the concerned cadets. Two days later, Cadet lCL Cudia received his
DR.
In his Explanation of Report dated December 8, 2013, Cadet lCL Cudia reasoned
out that: "I came directly from OR432 Class. We were dismissed a bit late by our
instructor Sir."19
On December 19, 2013, Major Rommel Dennis Hindang (Maj. Hindang), the CTO
of Cadet 1 CL Cudia, meted out to him the penalty of 11 demerits and 13 touring
hours. Immediately, Cadet lCL Cudia clarified with Maj. Hindang his alleged
violation. The latter told him that the basis of the punishment was the result of his
conversation with Dr. Costales, who responded that she never dismissed her class
late, and the protocol to dismiss the class 10-15 minutes earlier than scheduled.
When he expressed his intention to appeal and seek reconsideration of the
punishment, he was · advised to put the request in writing. Hence, that same day,
Cadet 1 CL Cudia addressed his Request for Reconsideration of Meted
Punishment to Maj. Benjamin L. Leander, Senior Tactical Officer (STO), asserting:
I strongly believe that I am not in control of the circumstances, our 4th period class
ended 1500H and our 5th period class, which is ENG412, started 1500H also.
Immediately after 4t period class, I went to my next class without any intention of
being late Sir.20
A day after, Maj. Leander instructed Maj. Hindang to give his comments on the
request of Cadet 1 CL Cudia and to indicate if there were other cadets belonging
to the same section who were also late.
On December 28, 2013, Maj. Hindang submitted his reply to Maj. Leander pointing
out that, based on his investigation, the 4th period class was not dismissed late. As
a result, Maj. Leander sustained the penalty imposed. Petitioners alleged that
Cadet 1 CL Cudia came to know of the denial of his request only on January 24,
2014 upon inquiry with Maj. Leander.
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Several days passed, and on January 7, 2014, Cadet lCL Cudia was informed that
Maj. Hindang reported him to the HC21 for violation of the Honor Code. The Honor
Report stated:
Lying that is giving statement that perverts the truth in his written appeal, stating
that his 4th period class ended at l 500H that made him late in the succeeding
class.22
Upon asking the HC Chairman, Cadet 1 CL Mike Anthony P. Mogol (Cadet 1 CL
Mogol), as to what Maj. Hindang meant in his Report, Cadet lCL Cudia learned
that it was based on Maj. Hindang's conversations with their instructors and
classmates as well as his statement in the request for reconsideration to Maj.
Leander. He then verbally applied for and was granted an extension of time to
answer the charge against him because Dr. Costales, who could shed light on the
matter, was on emergency leave.
On January 13, 2014, Dr. Costales sent text messages to Cadet lCL Cudia,
conveying:
Gud pm cdt cudia. Mam belandres gave me bkground na. She told me its a report
dated november. When maj hindang ask me, no time referens. (04:25:11 P.M.)
All the while I thot he was refering to dismisal during last day last december. Whc i
told, i wud presume they wil finish early bee its grp work. (04:29:21 P.M.) 23
The next day, Cadets lCL Cudia and Arcangel approached Dr. Costales, who
reaffirmed that she and Maj. Hindang were not in the same time reference when
the latter asked her.
Later, Cadet 1 CL Cudia submitted his letter of explanation on the Honor Report.
He averred:
Sir, We had an LE that day (14 November 2013) in OR432 class. When the first
bell rang (1455), I stood up, reviewed my paper and submitted it to my instructor,
Ms. Costales. After which, I and Cadet lcl Arcangel asked for some query with
regards (sic) to the deductions of our previous LE. Our instructor gladly answered
our question. She then told me that she will give the copy of our section grade, so I
waited at the hallway outside the ACAD5 office, and then she came out of the
room and gave me a copy of the grades. Cadet Arcangel, Cadet Narciso and I
immediately went to our 5ti period class which is ENG412.
With these statements, I would like to clarify the following:
1. How could this be lying?
2. What is wrong with the side of Maj. Hindang (why did he come
up to that honor report)?
3. What are his assumptions?
I appeal, in the name of clarity, fairness and truth[,] that my case be reopened and
carefully reviewed for I did not violate the honor code/system, I can answer NO to
both questions (Did I intend to deceive? Did I intend to take undue advantage?)
and for the following reasons:
1. The honor report of Maj. Hindang was already settled and
finalized given the fact that no face-to-face personal conversation
with Ms. Costales was conducted to clarify what and when exactly
was the issue at hand.
2. Statements of the respondents support my explanation.
3. My explanation to my appeal to my DR (Request for
reconsideration of meted punishment) further supports my
explanation in my delinquency report.
4. My understanding of the duration of the "CLASS" covers not
just a lecture in a typical classroom instruction but includes every
transaction and communication a teacher does with her students,
especially that in our case some cadets asked for queries, and I
am given instruction by which (sic) were directly related to our
CLASS. Her transaction and communication with our other
classmates may have already ended but ours extended for a little
bit.
I agree and consider that because Cadet CUDIA is under
my instruction to wait, and the other cadets still have
business with me, it is reasonable enough for him to say
that "Our class was dismissed a bit late" (dealing with
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 matter of seconds or a minute particularly 45 seconds to 1
minute and 30 seconds)
And with concern to (sic) OR432 class, I can say it ended
on time (1500H).
(signed)
M COSTALES
w/ attached certification
5. I was transparent and honest in explaining the 2-minute delay
and did not attempt to conceal anything that happened or I did.
6. Furthermore, CPT DULA WAN PA, the Tactical Officer of Hawk
Company[,] and I had a conversation with regards (sic) to the
same matter for which he can give important points of my case.
7. Cadet lcl DIAZ "D" Co can also stand as a witness that I waited
for Ms. Costales. 24
On January 15, 2014, the HC constituted a team to conduct a preliminary
investigation on the reported honor violation of Cadet 1 CL Cudia. The Foxtrot
Company was designated as the investigating team and was composed of Cadet 1
CL Hasigan as Presiding Officer, and Cadets 1 CL Mogol, lCL Raguindin, 2CL
Gumilab, 2CL Saldua, 3CL Espejo, and 3CL Poncardas as members. 25 Soon after,
the team submitted its Preliminary Investigation Report recommending that the
case be formalized.
The formal investigation against Cadet 1 CL Cu di a then ensued. The Presiding
Officer was Cadet 1 CL Rhona K. Salvacion, while the nine (9) voting members
were Cadets lCL Jairus 0. Fantin, lCL Bryan Sonny S. Arlegui, 1 CL Kim Adrian R.
Martal, 1 CL J eanelyn P. Cabrido, 1 CL ShuAydan G. Ayada, 1 CL Dalton John G.
Lagura, 2CL Renato A. Carifio, Jr., 2CL Arwi C. Martinez, and 2CL Niko Angelo C.
Tarayao.26 Acting as recorders tasked to document the entire proceedings were
4CL Jennifer A. Cuarteron and 3CL Leoncio Nico A. de Jesus 11.27 Those who
observed the trial were Cadets 1 CL Balmeo, Dag-uman, Hasigan, Raguindin,
Paulino, Arcangel, and Narciso; Cadets 2CL Jocson and Saldua, Jr.; and Cadet
3CL Umaguing.28
The first formal hearing started late evening of January 20, 2014 and lasted until
early morning the next day. Cadet lCL Cudia was informed of the charge against
him, as to which he pleaded "Not Guilty." Among those who testified were Cadet 1
CL Cudia, Maj. Hindang, and Cadets 1 CL Arcangel and Narciso. On the second
night of the hearing held on January 21, 2014, Cadet 1 CL Cudia again appeared
and was called to the witness stand along with Cadets Brit and Barrawed. Dr.
Costales also testified under oath via phone on a loudspeaker. Deliberation among
the HC voting members followed. After that, the ballot sheets were distributed. The
members cast their votes through secret balloting and submitted their
accomplished ballot sheets together with their written justification. The result was
8-1 in favor of a guilty verdict. Cadet lCL Dalton John G. Lagura (Cadet lCL
Lagura) was the lone dissenter. Allegedly, upon the order ofHC Chairman Cadet 1
CL Mogol, the Presiding Officer and voting members went inside a chamber
adjoining the court room for further deliberation. After several minutes, they went
out and the Presiding Officer announced the 9-0 guilty verdict. Cadet 1 CL Cudia,
who already served nine (9) touring hours, was then informed of the unanimous
votes finding him guilty of violating the Honor Code. He was immediately placed in
the PMA Holding Center until the resolution of his appeal.
On January 24, 2014, Cadet ICL Cudia filed a written appeal addressed to the HC
Chairman, the full text of which stated:
WRITTEN APPEAL
14 NOVEMBER 2013
This is when I was reported for "Late for two (2) minutes in Eng412 class", my
explanation on this delinquency report when I received it, is that "Our class was
dismissed a (little) bit late and I came directly from 4th period class ... etc".
Knowing the fact that in my delinquency report, it is stated that ENG412 classes
started 1500H and I am late for two minutes, it is logical enough for I (sic) to
interpret it as "I came 1502H during that class". This is the explanation that came
into my mind that time. (I just cannot recall the exact words I used in explaining
that delinquency report, but what I want to say is that I have no intention to be
late). In my statements, I convey my message as "since I was not the only one left
in that class, and the instructor is with us, I used the term "CLASS", I used the
word "DISMISSED" because I was under instruction (to wait for her to give the
section grade) by the instructor, Ms. Costales. The other cadets (lCL MIRANDA,
lCL ARCANGEL) still have queries and business with her that made me decide to
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use the word "CLASS", while the others who don't have queries and business with
her (ex: lCL NARCISO and 1 CL DIAZ) were also around.
Note:
The four named cadets were also reported late.
Reference: Para 171. 0. (Leaving the Classroom Prior to Dismissal Time)(Sec
XVII, CCAFPR s2008)
It is stated in this reference that "Cadets shall not linger in the place of instruction
after the section has been dismissed. EXCEPT when told or allowed to do so by
the instructor or by any competent authority for official purposes. "
The instruction by Ms. Costales was given to me before the two bells rang
(indicating the end of class hour, 1500H). I waited for her for about 45 seconds to 1
minute and 30 seconds, that made me to decide to write "a little bit late" in my
explanation. Truly, the class ENDED 1500H but due to official purpose (instruction
by Ms. Costales to wait) and the conflict in academic schedule (to which I am not
in control of the circumstances, 4th PD class 1330H-1500H and 5th PD class
1500H-1 600H), and since Ms. Costales, my other classmates, and I were there, I
used the word "CLASS".
19 December 2013
I was informed that my delinquency report was awarded, 11 Demerits and 13
Touring hours. Not because I don't want to serve punishment, but because I know
I did nothing wrong, I obeyed instruction, and believing that my reason is justifiable
and valid, that is why I approached our tactical officer, MAJ HINDANG PAF, to
clarify and ask why it was awarded that day.
In our conversation, he said that he had a phone call to my instructor and he even
added that they have a protocol to dismiss the class, 15 minutes or 10 minutes
before 1500H. I explained:
Sir, I strongly believe that I am not in control of the circumstances, our 4th period
class ended 1500H and our 5th period class, which is ENG412, started 1500H
also. Immediately after 4th period class, I went to my next class without any
intention of being late Sir.
These statements are supplementary to my explanation in my delinquency report,
in here, I specified the conflict in the schedule and again, I have no intention to be
late. After explaining it further with these statements, my tactical officer said that
since I was reported in a written form, I should make an appeal in a written form.
Thinking that he already understood what I want to say, I immediately made an
appeal that day stating the words that I used in having conversation with him.29
Attached to the written appeal was a Certification dated January 24, 2014, wherein
Dr. Costales attested:
1. That Cadet MIRANDA, ARCANGEL, [and] NARCISO was (sic) with
Cadet CUDIA in making query about their latest grades in OR432 and/or
results of UEl outside the ACADS office. The following facts may explain
their queries on 14 November 2013:
a. That I held my class in the PMAFI room instead of room 104.
b. That OR432 releases grades every Wednesday and cadets are
informed during Thursday, either in class or posted grades in the
bulletin board (grades released was [sic J based on the previous
LEs: latest LE before UE was Decision Trees).
c. That UE papers were already checked but not yet recorded due
to (sic) other cadets have not taken the UE. Cadets were allowed
to verify scores but not to look at the papers.
d. Last 23 January 2014, Captain Dulawan clarified if indeed
Cadet NARCISO and ARCANGEL verified grades. The two cadets
said that they verified something with me after the OR432 class
and they were with Cadet CUD IA. That the statements of the
three (3) cadets are all the same and consistent, thus[,] I honor
that as true.
2. As to the aspect of dismissing late, I could not really account for the
specific time that I dismissed the class. To this date, I [cannot] really recall
an account that is more than two (2) months earlier. According to my
records, there was a lecture followed by an LE during (sic) on 14
November 2013. To determine the time of my dismissal, maybe it can be
verified with the other members of class I was handling on that said date.30
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Respondents contend that the HC denied the appeal the same day, January · 24,
as it found no reason to conduct a re-trial based on the arguments and evidence
presented.31 Petitioners, however, claim that the written appeal was not acted
upon until the filing of the petition-in-intervention.32
From January 25 to February 7, 2014, respondents allege that the Headquarters
Tactics Group (HTG) conducted an informal review to check the findings of the
HC. During the course of the investigation, Prof. Berong was said to have
confirmed with the Officer-in-Charge of the HC that classes started as scheduled
(i.e., 3:05 p.m. or 1505H), and that Cadet lCL Barrawed, the acting class marcher
of ENG412, verified before the Commandant, Assistant Commandant, and STO
that the class started not earlier than scheduled.
Meantime, on February 4, 2014, the OIC of the HC forwarded the Formal
Investigation Report to the Staff Judge Advocate (SJA) for review. The next day,
the SJA found the report to be legally in order.
On February 8, 2014, Colonel Rozzano D. Briguez (Col. Briguez), the
Commandant of Cadets, affirmed the HC findings and recommended to Vice
Admiral Edgar Abogado, then PMA Superintendent, the separation from the PMA
of Cadet lCL Cudia for violation of the First Tenet of the Honor Code (Lying,
pursuant to Sec. VII.12.b of the CCAFPR S-2008). On the same date, Special
Orders No. 26 was issued by the PMA Headquarters placing Cadet 1 CL Cudia on
indefinite leave of absence without pay and allowances effective February 10,
2014 pending approval of his separation by the AFPGHQ, barring him from future
appointment and/or admission as cadet, and not permitting him to qualify for any
entrance requirements to the PMA. 33
Two days later, Vice Admiral Abogado approved the recommendation to dismiss
Cadet 1 CL Cudia.
On February 13, 2014, Cadet lCL Cudia submitted a letter to the Office of the
Commandant of Cadets requesting for reinstatement by the PMA of his status as a
cadet.34
Four days passed, Annavee P. Cudia (Annavee ), the sister of Cadet 1 CL Cudia,
posted his plight in her Face book account. The day after, the Spouses Cudia gave
a letter to Major General Oscar Lopez (Maj. Gen. Lopez), the new PMA
Superintendent, asking to recognize the 8-1 voting of the HC.35 Copies of which
were furnished to the AFP Chief of Staff and other concerned military officials.
Subsequently, Maj. Gen. Lopez was directed to review Cadet lCL Cudia's case.
The latter, in turn, referred the matter to the Cadet Review and Appeals Board
(CRAB).
On February 19, 2014, Cadet lCL Cudia made his personal appeal letter to Maj.
Gen. Lopez. On even date, the AFP Chief of Staff ordered a reinvestigation
following the viral Facebook post of Annavee demanding the intervention of the
military leadership.
Petitioners claim that, on February 21, 2014, Special Order No. 1 was issued
directing all PMA cadets to ostracize Cadet 1 CL Cudia by not talking to him and
by separating him from all activities/functions of the cadets. It is said that any
violation shall be a "Class 1" offense entailing 45 demerits, 90 hours touring, and
90 hours confinement. Cadet 1 CL Cudia was not given a copy of the order and
learned about it only from the media.36 According to an alleged news report, PMA
Spokesperson Major Agnes Lynette Flores (Maj. Flores) confirmed the HC order to
ostracize Cadet 1 CL Cudia. Among his offenses were: breach of confidentiality by
putting documents in the social media, violation of the PMA Honor Code, lack of
initiative to resign, and smearing the name of the PMA. 37
On February 24, 2014, Cadet 1CL Cudia requested the CRAB for additional time,
until March 4, 2014, to file an appeal on the ground that his intended witnesses are
in on-the-job training ( OJT).38 As additional evidence to support his appeal, he
also requested for copies of the Minutes of the HC proceedings, relevant
documents pertaining to the case, and video footages and recordings of the HC
hearings.
The next day, Cadet 1 CL Cudia and his family engaged the services of the Public
Attorney's Office (PAO) in Baguio City.
The CRAB conducted a review of the case based on the following: (a) letter of
appeal of the Spouses Cudia dated February 18, 2014; (b) directive from the AFP-
GHQ to reinvestigate the case; and ( c) guidance from Maj. Gen. Lopez.
On February 26, 2014, Brigadier General Andre M. Costales, Jr. (Brig. Gen.
Costales, Jr.), the CRAB Chairman, informed Cadet lCL Cudia that, pending
approval of the latter's request for extension, the CRAB would continue to review
the case and submit its recommendations based on whatever evidence and
testimonies received, and that it could not favorably consider his request for copies
of the HC minutes, relevant documents, and video footages and recordings of the
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HC hearings since it was neither the appropriate nor the authorized body to take
action thereon.39Subsequently, upon verbal advice, Cadet 1 CL Cudia wrote a
letter to Maj. Gen. Lopez reiterating his request. 40
Two days after, the Spouses Cudia filed a letter-complaint before the CHR-
Cordillera Administrative Region (CAR) Office against the HC members and Maj.
Gracilla for alleged violation of the human rights of Cadet lCL Cudia, particularly
his rights to due process, education, and privacy of communication. 41
On March 4, 2014, Cadet 1 CL Cudia, through the PAO, moved for additional time,
until March 19, 2014, to file his appeal and submit evidence. PAO also wrote a
letter to AFP Chief of Staff General Emmanuel T. Bautista (Gen. Bautista) seeking
for immediate directive to the PMA to expeditiously and favorably act on Cadet
1CL Cudia's requests.42
Exactly a week prior to the commencement exercises of Siklab Diwa Class, the
following events transpired:
On March 10, 2014, Annavee sought the assistance of PAO Chief Public Attorney
Persida V. Rueda-Acosta.43 On the other hand, the CRAB submitted a report to the
AFP-GHQ upholding the dismissal of Cadet 1 CL Cudia.44
On March 11, 2014, PAO received a letter from Maj. Gen. Lopez stating the denial
of Cadet 1CL Cudia's requests for extension of time to file an Appeal
Memorandum in view of the ample time already given, and to be furnished with a
copy of relevant documents because of confidentiality and presumption of
regularity of the HC proceedings.45Cadet 1CL Cudia, through PAO, then filed an
Appeal Memorandum46 before the CRAB.
On March 12, 2014, Spouses Cudia wrote a letter to President Benigno Simeon C.
Aquino III (Pres. Aquino), who is the Commander-in-Chief of the AFP, attaching
thereto the Appeal Memorandum.47 On the same day, Special Orders No. 48 was
issued by the PMA constituting a Fact-Finding Board/Investigation Body composed
of the CRAB members and PMA senior officers to conduct a deliberate
investigation pertaining to Cadet 1CL Cudia's Appeal Memorandum.48 The focus of
the inquiry was not just to find out whether the appeal has merit or may be
considered but also to investigate possible involvement of other cadets and
members of the command related to the incident and to establish specific violation
of policy or regulations that had been violated by other cadets and members of the
HC.49
On March 13, 2014, the Cudia family and the Chief Public Attorney had a dialogue
with Maj. Gen. Lopez. On March 14, 2014, the CHR-CAR came out with its
preliminary findings, which recommended the following:
a. For the PMA and the Honor Committee to respect and uphold the 8
Guilty - 1 Not guilty vote;
b. For the PMA and the Honor Committee to officially pronounce Cdt
Cudia as Not Guilty of the charge filed against him before the Honor
Committee;
c. For the PMA to restore Cadet Cudia's rights and entitlements as a full-
fledge graduating cadet and allow him to graduate on Sunday, 16 March
2014;
d. For the PMA to fully cooperate with the CHR in the investigation of
Cudia's Case.50
On March 15, 2014, Cadet 1CL Cudia and his family had a meeting with Pres.
Aquino and Department of National Defense (DND) Secretary Voltaire T. Gazmin.
The President recommended that they put in writing their appeal, requests, and
other concerns. According to respondents, the parties agreed that Cadet 1 CL
Cudia would not join the graduation but it was without prejudice to the result of the
appeal, which was elevated to the AFP Chief of Staff. The President then tasked
Gen. Bautista to handle the reinvestigation of the case, with Maj. Gen. Oscar
Lopez supervising the group conducting the review.
Four days after Siklab Diwa Class' graduation day, petitioner Renato S. Cudia
received a letter dated March 11, 2014 from the Office of the AFP Adjutant
General and signed by Brig. Gen. Ronald N. Albano for the AFP Chief of Staff,
affirming the CRAB' s denial of Cadet 1 CL Cudia' s appeal. It held:
After review, The Judge Advocate General, APP finds that the action of the PMA
CRAB in denying the appeal for reinvestigation is legally in order. There was
enough evidence to sustain the finding of guilt and the proprietary (sic) of the
punishment imposed. Also, your son was afforded sufficient time to file his appeal
from the date he was informed of the final verdict on January 21, 2014, when the
decision of the Honor Committee was read to him in person, until the time the PMA
CRAB conducted its review on the case. Moreover, the continued stay of your son
at the Academy was voluntary. As such, he remained subject to the Academy's
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policy regarding visitation. Further, there was no violation of his right to due
process considering that the procedure undertaken by the Honor Committee and
PMA CRAB was consistent with existing policy. Thus, the previous finding and
recommendation of the Honor Committee finding your son, subject Cadet guilty of
"Lying" and recommending his separation from the Academy is sustained.
In view of the foregoing, this Headquarters resolved to deny your appeal for lack of
merit.51 Thereafter, the Fact-Finding Board/Investigating Body issued its Final
Investigation Report on March 23, 2014 denying Cadet 1 CL Cudia's
appeal.52 Subsequently, on April 28, 2014, the special investigation board tasked
to probe the case submitted its final report to the President.53 Pursuant to the
administrative appeals process, the DND issued a Memorandum dated May 23,
2014, directing the Office of AFP Chief of Staff to submit the complete records of
the case for purposes of DND review and recommendation for disposition by the
President.54
Meanwhile, on May 22, 2014, the CHR-CAR issued its Resolution with respect to
CHR-CAR Case No. 2014-0029, concluding and recommending as follows:
WHEREFORE, PREMISES CONSIDERED, the Commission on Human Rights-
CAR Office finds PROBABLE CAUSE FOR HUMAN RIGHTS VIOLATIONS
against the officers and members of the PMA Honor Committee and .. certain PMA
officials, specifically for violations of the rights of CADET ALDRIN JEFF P. CUDIA
to dignity, due process, education, privacy/privacy of communication, and good
life.
IN VIEW OF THE FOREGOING, the CHR-CAR Office RESOLVED to indorse to
competent authorities for their immediate appropriate action on the following
recommendations:
1. The Philippine Military Academy must set aside the "9-Guilty, 0-
Not Guilty" verdict against Cadet Aldrin Jeff P. Cudia, for being
null and void; to uphold and respect the "8-Guilty, 1-Not Guilty"
voting result and make an official pronouncement of NOT GUILTY
in favor of Cadet Cudia;
2. The PMA, the AFP Chief of Staff, and the President in whose
hands rest the ends of justice and fate of Cadet Cudia, to:
2.1 officially proclaim Cadet Cudia a graduate and
alumnus of the Philippine Military Academy;
2.2 issue to Cadet Cudia the corresponding Diploma for
the degree of Bachelors of Science; and
2.3 Issue to Cadet Cudia the corresponding official
transcript 'of his academic records for his BS degree,
without conditions therein as to his status as a PMA cadet.
3. The Public Attorneys' Office to provide legal services to Cadet
Cudia in pursuing administrative, criminal and civil suits against
the officers and members of the Honor Committee named
hereunder, for violation of the Honor Code and System and the
Procedure in Formal Investigation, dishonesty, violation of the
secrecy of the ballot, tampering the true result of the voting,
perjury, intentional omission in the Minutes of substantive part of
the formal trial proceedings which are prejudicial to the interest of
justice and Cadet Cudia's fundamental rights to dignity, non-
discrimination and due process, which led to the infringement of
his right to education and even transgressing his right to a good
life.
3.1 Cdt lCL MIKE ANTHONY MOGUL, now 2nd Lt. of the
AFP
3.2 Cdt lCL RHONA K. SALVACION, now 2nd Lt. of the
AFP
3.3 Cdt 2CL ARWI C. MARTINEZ
3.4 Cdt 2CL RENATO A. CARINO, JR.
3.5 Cdt 2CL NIKOANGELOC. TARAYAO
3.6 Cdt lCL JEANEL YN P. CABRIDO, now 2nd Lt. of the
AFP
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 3.7 Cdt lCL KIM ADRIAN R. MARTAL, now 2nd Lt. of the
AFP
3.8 Cdt lCL JAIRUS 0. FANTIN, now 2nd Lt. of the AFP
3.9 Cdt lCL BRYAN SONNY S. ARLEGUI, now 2nd Lt. of
the AFP
3.10 Cdt lCL DALTON JOHN G. LAGURA, now 2nd Lt. of
the AFP
3.11 Cdt 1 CL BIANCHIHEIMER L. EDRA, now 2nd Lt. of
the AFP
3.12 Cdt 4CL JENNIFER A. CUARTERON (recorder)
3.13 Cdt 3CL LEONCIO NICO A. DE JESUS II (record)
4. The Office of the AFP Chief of Staff and the PMA competent
authorities should investigate and file appropriate charges against
Maj. VLADIMIR P. GRACILLA, for violation of the right to privacy
of Cadet Cudia and/or failure, as intelligence officer, to ensure the
protection of the right to privacy of Cudia who was then billeted at
the PMA Holding Center;
5. The Office of the AFP Chief of Staff and PMA competent
authorities should investigate Maj. DENNIS ROMMEL HINDANG
for his failure and ineptness to exercise his responsibility as a
competent Tactical Officer and a good father of his cadets, in this
case, to Cadet Cudia; for failure to respect exhaustion of
administrative remedies;
6. The Secretary of National Defense, the Chief of Staff of the
Armed Forces of the Philppines, the PMA Superintendent, to
immediately cause the comprehensive review of all rules of
procedures, regulations, policies, including the so-called practices
in the implementation of the Honor Code; and, thereafter, adopt
new policies, rules of procedures and relevant regulations which
are human-rights based and consistent with the Constitution and
other applicable laws;
7. The Congress of the Philippines to consider the enactment of a
law defining and penalizing ostracism and discrimination, which is
apparently being practiced in the PMA, as a criminal offense in
this jurisdiction;
8. His Excellency The President of the Philippines to certify as
priority, the passage of an anti-ostracism and/or anti-discrimination
law; and
9. Finally, for the AFP Chief of Staff and the PMA authorities to
ensure respect and protection of the rights of those who testified
for the cause of justice and truth as well as human rights of Cadet
Cudia.
RESOLVED FURTHER, to monitor the actions by the competent authorities on the
foregoing CHR recommendations.
Let copy of this resolution be served by personal service or by substituted service
to the complainants (the spouses Renato and Filipina Cudia; and Aldrin Jeff P.
Cudia), and all the respondents. Also, to the PMA Superintendent, the AFP Chief
of Staff, the Secretary of National Defense, His Excellency The President of the
Philippines, The Public Attorneys' Office.
SO RESOLVED.55
On June 11, 2014, the Office of the President sustained the findings of the AFP
Chief of Staff and the CRAB. The letter, which was addressed to the Spouses
Cudia and signed by Executive Secretary Paquito N. Ochoa, Jr., stated in whole:
This refers to your letters to the President dated 12 March 2014 and 26 March
2014 appealing for a reconsideration of the decision of the Philippine Military
Academy (PMA) Honor Committee on the case of your son, Cadet 1 CL Aldrin Jeff
Cudia.
After carefully studying the records of the case of Cadet Cudia, the decision of the
Chief of Staff of the Armed Forces of the Philippines (AFP), and the Honor Code
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System of the AFP Cadet Corps, this Office has found no substantial basis to
disturb the findings of the AFP and the PMA Cadet Review Appeals Board
(CRAB). There is no competent evidence to support the claim that the decision of
the Honor Committee members was initially at 8 "Guilty" votes and 1 "Not Guilty"
vote. The lone affidavit of an officer, based on his purported conversation with one
Honor Committee member, lacks personal knowledge on the deliberations of the
said Committee and is hearsay at best.
Similarly, the initial recommendations of the Commission on Human Rights cannot
be adopted as basis that Cadet Cudia's due process rights were violated. Apart
from being explicitly preliminary in nature, such recommendations are anchored on
a finding that there was an 8-1 vote which, as discussed above, is not supported
by competent evidence.
In the evaluation of Cadet Cudia's case, this Office has been guided by the precept
that military law is regarded to be in a class of its own, "applicable only to military
personnel because the military constitutes an armed organization requiring a
system of discipline separate from that of civilians" (Gonzales v. Abaya, G.R. No.
164007, 10 August 2005 citing Calley v. Callaway, 519 F. 2d 184 [1975] and Orloff
v. Willoughby, 345 US 83 [1953]). Thus, this Office regarded the findings of the
AFP Chief, particularly his conclusion that there was nothing irregular in the
proceedings that ensued, as carrying great weight.
Accordingly, please be informed that the President has sustained the findings of
the AFP Chief and the PMA CRAB.56
The Issues
To petitioners, the issues for resolution are:
I.
WHETHER THE PHILIPPINE MILITARY ACADEMY, THE HONOR COMMITTEE
AND THE CADET REVIEW AND APPEALS BOARD COMMITTED GRAVE
ABUSE OF DISCRETION IN DISMISSING CADET FIRST CLASS ALDRIN JEFF
P. CUDIA FROM THE ACADEMY IN UTTER DISREGARD OF HIS RIGHT TO
DUE PROCESS CONSIDERING THAT:
A. Despite repeated requests for relevant documents regarding his case,
Cadet First Class Aldrin Jeff Cudia was deprived of his right to have
access to evidence which would have proven his defense, would have
totally belied the charge against him, and more importantly, would have
shown the irregularity in the Honor Committee's hearing and rendition of
decision
B. Cadet First Class Aldrin Jeff Cudia was vaguely informed of the
decisions arrived at by the Honor Committee, the Cadet Review and
Appeals Board and the Philippine Military Academy
C. The Honor Committee, the Cadet Review and Appeals Board and the
Philippine Military Academy have afforded Cadet First Class Aldrin Jeff
Cudia nothing but a sham trial
D. The Honor Committee, the Cadet Review and Appeals Board and the
Philippine Military Academy violated their own rules and principles as
embodied in the Honor Code
E. The Honor Committee, the Cadet Review and Appeals Board and the
Philippine Military Academy, in deciding Cadet First Class Aldrin Jeff
Cudia's case, grossly and in bad faith, misapplied the Honor Code so as to
defy the 1987 Constitution, notwithstanding the unquestionable fact that
the former should yield to the latter.
II
WHETHER THE PHILIPPINE MILITARY ACADEMY, THE HONOR COMMITTEE
AND THE CADET REVIEW AND APPEALS BOARD COMMITTED GRAVE
ABUSE OF DISCRETION IN HOLDING THAT CADET FIRST CLASS ALDRIN
JEFF P. CUDIA LIED, THEREBY VIOLATING THE HONOR CODE
III
WHETHER THE RESULT OF THE FACT-FINDING INVESTIGATION
INDEPENDENTLY CONDUCTED BY THE COMMISSION ON HUMAN RIGHTS
IS OF SUCH GREAT WEIGHT AND PERSUASIVE NATURE THAT THIS
HONORABLE COURT MAY HONOR, UPHOLD AND RESPECT 57
On the other hand, in support of their prayer to dismiss the petition, respondents
presented the issues below:
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 PROCEDURAL GROUNDS
I.
THE MANDAMUS PETITION PRAYING THAT CADET CUDIA BE INCLUDED IN
THE LIST OF GRADUATES OF SIKLAB DIWA CLASS OF 2014 AND BE
ALLOWED TO TAKE PART IN THE COMMENCEMENT EXERCISES HAS
ALREADY BEEN RENDERED MOOT.
II.
THE ISSUES RAISED IN THE PETITIONS ARE ACTUALLY FACTUAL WHICH
ARE BEYOND THE SCOPE OF A PETITION FOR CERTIORARI, PROHIBITION
AND MANDAMUS.
III.
MANDAMUS DOES NOT LIE TO COMPEL RESPONDENTS TO GRANT THE
RELIEFS PRAYED FOR. IV. IT IS PREMATURE TO INVOKE JUDICIAL
REDRESS PENDING THE DECISION OF THE PRESIDENT ON CADET
CUDIA'S APPEAL.
V.
WITH UTMOST DUE RESPECT, THE HONORABLE COURT MUST EXERCISE
CAREFUL RESTRAINT AND REFRAIN FROM UNDULY OR PREMATURELY
INTERFERING WITH LEGITIMATE MILITARY MATTERS.
SUBSTANTIVE GROUNDS
VI.
CADET CUDIA HAS NECESSARILY AND VOLUNTARILY RELINQUISHED
CERTAIN CIVIL LIBERTIES BY VIRTUE OF HIS ENTRY INTO THE PMA.
VII.
THE PMA ENJOYS THE ACADEMIC FREEDOM WHICH AUTHORIZES IT TO
IMPOSE DISCIPLINARY MEASURES AND PUNISHMENT AS IT DEEMS FIT
AND CONSISTENT WITH THE PECULIAR NEEDS OF THE ACADEMY.
VIII.
CADET CUDIA WAS PROPERLY AFFORDED PROCEDURAL DUE PROCESS.
The PMA has regulatory authority to administratively terminate cadets despite the
absence of statutory authority.
Violation of the Honor Code warrants the administrative dismissal of a guilty cadet.
Cadet Cudia violated the first tenet of the Honor Code by providing untruthful
statements in the explanation for his tardiness.
The higher authorities of the PMA did not blindly adopt the findings of the Honor
Committee.
The procedural safeguards in a student disciplinary case were properly accorded
to Cadet Cudia.
The subtle evolution in the voting process of the Honor Committee, by
incorporating executive session/chambering, was adopted to further strengthen the
voting procedure of the Honor Committee. Cadet Lagura voluntarily changed his
vote without any pressure from the other voting members of the Honor Committee.
Ostracism is not a sanctioned practice of the PMA.
The findings of the Commission on Human Rights are not binding on the
Honorable Court, and are, at best, recommendatory.
Cadet Cudia was not effectively deprived of his future when he was dismissed
from the PMA.58
The Ruling of the Court
PROCEDURAL GROUNDS
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Propriety of a petition for mandamus
Respondents argue that the mandamus aspect of the petition praying that Cadet 1
CL Cudia be included in the list of graduating cadets and for him to take part in the
commencement exercises was already rendered moot and academic when the
graduation ceremonies of the PMA Siklab Diwa Class took place on March 16,
2014. Also, a petition for mandamus is improper since it does not lie to compel the
performance of a discretionary duty. Invoking Garcia v. The Faculty Admission
Committee, Loyola School of Theology,59 respondents assert that a mandamus
petition could not be availed of to compel an academic institution to allow a student
to continue studying therein because it is merely a privilege and not a right. In this
case, there is a clear failure on petitioners' part to establish that the PMA has the,
ministerial duty to include Cadet 1 CL Cudia in the list, much less award him with
academic honors and commission him to the Philippine Navy. Similar to the case
of University of San Agustin, Inc. v. Court of Appeals,60 it is submitted that the PMA
may rightfully exercise its discretionary power on who may be admitted to study
pursuant to its academic freedom.
In response, petitioners contend that while the plea to allow Cadet 1 CL Cudia to
participate in the PMA 2014 commencement exercises could no longer be had, the
Court may still grant the other reliefs prayed for. They add that Garcia enunciated
that a respondent can be ordered to act in a particular manner when there is a
violation of a constitutional right, and that the certiorari aspect of the petition must
still be considered because it is within the province of the Court to determine
whether a branch of the government or any of its officials has acted without or in
excess of jurisdiction or with grave abuse of discretion amounting to lack or excess
thereof.
We agree that a petition for mandamus is improper.
Under Section 3, Rule 65 of the Rules of Civil Procedure, a petition for mandamus
may be filed when any tribunal, corporation, board, officer, or person unlawfully
neglects the performance of an act which the law specifically enjoins as a duty
resulting from an office, trust, or station. It may also be filed when any tribunal,
corporation, board, officer, or person unlawfully excludes another from the use and
enjoyment of a right or office to which such other is entitled.
For mandamus to lie, the act sought to be enjoined must be a ministerial act or
duty. An act is ministerial if the act should be performed "[under] a given state of
facts, in a prescribed manner, in obedience to the mandate of a legal authority,
without regard to or the exercise of [the tribunal or corporation's] own judgment
upon the propriety or impropriety of the act done." The tribunal, corporation, board,
officer, or person must have no choice but to perform the act specifically enjoined
by law. This is opposed to a discretionary act whereby the officer has the choice to
decide how or when to perform the duty.61
In this case, petitioners pray for, among others: Also, after due notice and hearing,
it is prayed of the Court to issue a Writ of Mandamus to:
1. direct the PMA to include Cadet Cudia in the list of graduates of Siklab
Diwa Class of 2014 of the PMA, including inclusion in the yearbook;
2. direct the PMA to allow Cadet Cudia to take part in the commencement
exercises if he completed all the requirements for his baccalaureate
degree;
3. direct the PMA to award unto Cadet Cudia the academic honors he
deserves, and the commission as a new Philippine Navy ensign;
4. direct the Honor Committee to submit to the CRAB of the PMA all its
records of the proceedings taken against Cadet Cudia, including the video
footage and audio recordings of the deliberations and voting, for the
purpose of allowing the CRAB to conduct intelligent review of the case of
Cadet Cudia;
5. direct the PMA's CRAB to conduct a review de nova of all the records
without requiring Cadet Cudia to submit new evidence if it was physically
impossible to do so;
6. direct the PMA's CRAB to take into account the certification signed by
Dr. Costales, the new evidence consisting of the affidavit of a military
officer declaring under oath that the cadet who voted "not guilty" revealed
to this officer that this cadet was coerced into changing his vote, and other
new evidence if there is any;
7. direct the PMA's CRAB to give Cadet Cudia the right to a counsel who
is allowed to participate actively in the proceedings as well as in the cross-
examinations during the exercise of the right to confront witnesses against
him; and
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 8. direct the Honor Committee in case of remand of the case by the CRAB
to allow Cadet Cudia a representation of a counsel.62
Similarly, petitioner-intervenor seeks for the following reliefs:
A. xxx
B. a Writ of Mandamus be issued commanding:
a.) The PMA, Honor Committee, and CRAB to respect and uphold
the 8 Guilty -1 Not Guilty vote;
b.) The PMA, Honor Committee, and CRAB to officially pronounce
Cadet Cudia as Not Guilty of the charge filed against him before
the Honor Committee;
c.) The PMA to restore Cadet Cudia's rights and entitlements as a
full-fledged graduating cadet, including his diploma and awards.63
Anent the plea to direct the PMA to include Cadet 1 CL Cudia in the list of
graduates of Siklab Diwa Class of 2014 and to allow him to take part in the
commencement exercises, the same was rendered moot and academic when the
graduation ceremonies pushed through on March 16, 2014 without including Cadet
1 CL Cudia in the roll of graduates.
With respect to the prayer directing the PMA to restore Cadet 1 CL Cudia's rights
and entitlements as a full-fledged graduating cadet, including his diploma, awards,
and commission as a new Philippine Navy ensign, the same cannot be granted in
a petition for mandamus on the basis of academic freedom, which We shall
discuss in more detail below. Suffice it to say at this point that these matters are
within the ambit of or encompassed by the right of academic freedom; therefore,
beyond the province of the Court to decide.64 The powers to confer degrees at the
PMA, grant awards, and commission officers in the military service are
discretionary acts on the part of the President as the AFP Commander-in-Chief.
Borrowing the words of Garcia:
There are standards that must be met. There are policies to be pursued. Discretion
appears to be of the essence. In terms of Hohfeld's terminology, what a student in
the position of petitioner possesses is a privilege rather than a right. She [in this
case, Cadet 1 CL Cudia] cannot therefore satisfy the prime and indispensable
requisite of a mandamus proceeding.65
Certainly, mandamus is never issued in doubtful cases. It cannot be availed
against an official or government agency whose duty requires the exercise of
discretion or judgment.66 For a writ to issue, petitioners should have a clear legal
right to the thing demanded, and there should be an imperative duty on the part of
respondents to perform the act sought to be mandated.67
The same reasons can be said as regards the other reliefs being sought by
petitioners, which pertain to the HC and the CRAB proceedings. In the absence of
a clear and unmistakable provision of a law, a mandamus petition does not lie to
require anyone to a specific course of conduct or to control or review the exercise
of discretion; it will not issue to compel an official to do anything which is not his
duty to do or which is his duty not to do or give to the applicant anything to which
he is not entitled by law.68
The foregoing notwithstanding, the resolution of the case must proceed since, as
argued by petitioners, the Court is empowered to settle via petition for certiorari
whether there is grave abuse of discretion on the part of respondents in dismissing
Cadet 1 CL Cudia from the PMA.
Factual nature of the issues
According to respondents, the petition raises issues that actually require the Court
to make findings of fact because it sets forth several factual disputes which
include, among others: the tardiness of Cadet 1 CL Cudia in , his ENG412 class
and his explanation thereto, the circumstances that transpired in the investigation
of his Honor Code violation, the proceedings before the HC, and the allegation that
Cadet 1 CL Lagura was forced to change his vote during the executive
session/"chambering."
In opposition, petitioners claim that the instant controversy presents legal issues.
Rather than determining which between the two conflicting versions of the parties
is true, the case allegedly centers on the application, appreciation, and
interpretation of a person's rights to due process, to education, and to property; the
interpretation of the PMA Honor Code and Honor System; and the conclusion on
whether Cadet 1 CL Cudia's explanation constitutes lying. Even if the instant case
involves questions of fact, petitioners still hold that the Court is empowered to
settle mixed questions of fact and law. Petitioners are correct.
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There is a question of law when the issue does not call for an examination of the
probative value of evidence presented, the truth or falsehood of facts being
admitted and the doubt concerns the correct application of law and jurisprudence
on the matter. On the other hand, there is a question of fact when the doubt or
controversy arises as to the truth or falsity of the alleged facts. When there is no
dispute as to fact, the question of whether or not the conclusion drawn therefrom is
correct is a question of law.69 The petition does not exclusively present factual
matters for the Court to decide. As pointed out, the all-encompassing issue of
more importance is the determination of whether a PMA cadet has rights to due
process, to education, and to property in the context of the Honor Code and the
Honor System, and, if in the affirmative, the extent or limit thereof. Notably, even
respondents themselves raise substantive grounds that We have to resolve. In
support of their contention that the Court must exercise careful restraint and should
refrain from unduly or prematurely interfering in legitimate military matters, they
argue that Cadet 1 CL Cudia has necessarily and voluntarily relinquished certain
civil liberties by virtue of his entry into the PMA, and that the Academy enjoys
academic freedom authorizing the imposition of disciplinary measures and
punishment as it deems fit and consistent with the peculiar needs of the PMA.
These issues, aside from being purely legal being purely legal questions, are of
first impression; hence, the Court must not hesitate to make a categorical ruling.
Exhaustion of administrative remedies
Respondents assert that the Court must decline jurisdiction over the petition
pending President Aquino’s resolution of Cadet 1 CL Cudia' appeal. They say that
there is an obvious non-exhaustion of the full administrative process. While Cadet
1 CL Cudia underwent the review procedures of his guilty verdict at the Academy
level - the determination by the SJA of whether the HC acted according to the
established procedures of the Honor System, the assessment by the Commandant
of Cadets of the procedural and legal correctness of the guilty verdict, the
evaluation of the PMA Superintendent to warrant the administrative separation of
the guilty cadet, and the appellate review proceedings before the CRAB - he still
appealed to the President, who has the utmost latitude in making decisions
affecting the military. It is contended that the President's power over the persons
and actions of the members of the armed forces is recognized in B/Gen. (Ret.)
Gudani v. Lt./Gen. Senga70 and in Section 3171 of Commonwealth Act (CA.) No. 1
(also known as "The National Defense Act''). As such, the President could still
overturn the decision of the PMA. In respondents' view, the filing of this petition
while the case is pending resolution of the President is an irresponsible defiance, if
not a personal affront. For them, comity dictates that courts of justice should shy
away from a dispute until the system of administrative redress has been
completed.
From the unfolding of events, petitioners, however, consider that President Aquino
effectively denied the appeal of Cadet 1 CL Cudia. They claim that his family
exerted insurmountable efforts to seek reconsideration of the HC recommendation
from the APP officials and the President, but was in vain. The circumstances prior
to, during, and after the PMA 2014 graduation rites, which was attended by
President Aquino after he talked to Cadet lCL Cudia's family the night before,
foreclose the possibility that the challenged findings would still be overturned. In
any case, petitioners insist that the· rule on exhaustion of administrative remedies
is not absolute based on the Corsiga v. Defensor72 and Verceles v. BLR-
DOLE73 rulings.
We rule for petitioners.
In general, no one is entitled to judicial relief for a supposed or threatened injury
until the prescribed administrative remedy has been exhausted. The rationale
behind the doctrine of exhaustion of administrative remedies is that "courts, for
reasons of law, comity, and convenience, should not entertain suits unless the
available administrative remedies have first been resorted to and the proper
authorities, who are competent to act upon the matter complained of, have been
given the appropriate opportunity to act and correct their alleged errors, if any,
committed in the administrative forum."74 In the U.S. case of Ringgold v. United
States,75 which was cited by respondents, it was specifically held that in a typical
case involving a decision by military authorities, the plaintiff must exhaust his
remedies within the military before appealing to the court, the doctrine being
designed both to preserve the balance between military and civilian authorities and
to conserve judicial resources.
Nonetheless, there are exceptions to the rule. In this jurisdiction, a party may
directly resort to judicial remedies if any of the following is present:
1. when there is a violation of due process;
2. when the issue involved is purely a legal question;
3. when the administrative action is patently illegal amounting to lack or
excess of jurisdiction;
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 4. when there is estoppel on the part of the administrative agency
concerned;
5. when there is irreparable injury;
6. when the respondent is a department secretary whose acts as an alter
ego of the President bear the implied and assumed approval of the latter;
7. when to require exhaustion of administrative remedies would be
unreasonable;
8. when it would amount to a nullification of a claim;
9. when the subject matter is a private land in land case proceedings;
10. when the rule does not provide a plain, speedy and adequate remedy;
and
11. when there are circumstances indicating the urgency of judicial
intervention.76
Petitioners essentially raise the lack of due process in the dismissal of Cadet 1 CL
Cudia from the PMA. Thus, it may be a ground to give due course to the petition
despite the non-exhaustion of administrative remedies. Yet more significant is the
fact that during the pendency of this case, particularly on June 11, 2014, the Office
of the President finally issued its ruling, which sustained the findings of the AFP
Chief and the CRAB. Hence, the occurrence of this supervening event bars any
objection to the petition based on failure to exhaust administrative remedies.
Court's interference within military affairs
Respondents cite the U.S. cases of Bois v. Marsh77 and Schlesinger v.
Councilman78 to support their contention that judicial intervention would pose
substantial threat to military discipline and that there should be a deferential review
of military statutes and regulations since political branches have particular
expertise and competence in assessing military needs. Likewise, in Orloff v.
Willoughby79 and Parker v. Levy,80 it was allegedly opined by the U.S. Supreme
Court that the military constitutes a specialized community governed by a separate
discipline from that of the civilian. According to respondents, the U.S. courts'
respect to the military recognizes that constitutional rights may apply differently in
the military context than in civilian society as a whole. Such military deference is
exercised either by refusing to apply due process and equal protection doctrines in
military cases or applying them but with leniency.
In respondents' view, although Philippine courts have the power of judicial review
in cases attended with grave abuse of discretion amounting to lack or excess of
jurisdiction, policy considerations call for the widest latitude of deference to military
affairs. Such respect is exercised by the court where the issues to be resolved
entail a substantial consideration of legitimate governmental interest. They
suppose that allowing Cadet 1 CL Cudia's case to prosper will set an institutionally
dangerous precedent, opening a Pandora's box of other challenges against the
specialized system of discipline of the PMA. They state that with the PMA's
mandate to train cadets for permanent commission in the AFP, its disciplinary rules
and procedure necessarily must impose h different standard of conduct compared
with civilian institutions.
Petitioners, on the other hand, consider that this Court is part of the State's check-
and-balance machinery, specifically mandated by Article VIII of the 1987
Constitution to ensure that no branch of the government or any of its officials acts
without or in excess of jurisdiction or with grave abuse of, discretion amounting to
lack or excess of jurisdiction. They assert that judicial non-interference in military
affairs is not deemed as absolute even in the U.S. They cite Schlesinger and
Parker, which were invoked by respondents, as well as Burns v. Wilson81 and
Harmon v. Brucker,82 wherein the U.S. Supreme Court reviewed the proceedings
of military tribunals on account of issues posed concerning due process and
violations of constitutional rights. Also, in Magno v. De Villa 83 decided by this
Court, petitioners note that We, in fact, exercised the judicial power to determine
whether the APP and the members of the court martial acted with grave abuse o.f
discretion in their military investigation.
Petitioners' contentions are tenable.
Admittedly, the Constitution entrusts the political branches of the government, not
the courts, with superintendence and control over the military because the courts
generally lack the competence and expertise necessary to evaluate military
decisions and they are ill-equipped to determine the impact upon discipline that
any particular intrusion upon military authority might have.84 Nevertheless, for the
sake of brevity, We rule that the facts as well as the legal issues in the U.S. cases
cited by respondents are not on all fours with the case of Cadet 1 CL Cudia.
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Instead, what applies is the 1975 U.S. case of Andrews v. Knowlton,85 which
similarly involved cadets who were separated from the United States Military
Academy due to Honor Code violations. Following Wasson v. Trowbridge86 and
Hagopian v. Knowlton,87 Andrews re-affirmed the power of the district courts to
review procedures used at the service academies in the separation or dismissal of
cadets and midshipmen. While it recognized the "constitutional permissibility of the
military to set and enforce uncommonly high standards of conduct and ethics," it
said that the courts "have expanded at an accelerated pace the scope of judicial
access for review of military determinations." Later, in Kolesa v. Lehman,88 it was
opined that it has been well settled that federal courts have jurisdiction "where
there is a substantial claim that prescribed military procedures violates one's
constitutional rights." By 1983, the U.S. Congress eventually made major revisions
to the Uniform Code of Military Justice (UCMJ) by expressly providing, among
others; for a direct review by the U.S. Supreme Court of decisions by the military's
highest appellate authority.89
Even without referring to U.S. cases, the position of petitioners is still formidable. In
this jurisdiction, Section 1 Article VIII of the 1987 Constitution expanded the scope
of judicial power by mandating that the duty of the courts of justice includes not
only "to settle actual controversies involving rights which are legally demandable
and enforceable" but also "to determine whether or not there has been a grave
abuse of discretion amounting to lack or excess of jurisdiction on the part of any
branch or instrumentality of the Government" even if the latter does not exercise
judicial, quasi-judicial or ministerial functions.90 Grave abuse of discretion implies
such capricious and whimsical exercise of judgment as is equivalent to lack of
jurisdiction or where the power is exercised in an arbitrary or despotic manner by
reason of passion or personal hostility, which must be so patent and gross as to
amount to an evasion of positive duty or to a virtual refusal to perform the duty
enjoined or to act at all in contemplation of law.91
The proceedings of the Cadet Honor Committee can, for purposes of the Due
Process Clause, be considered a governmental activity. As ruled in Andrews:
The relationship between the Cadet Honor Committee and the separation process
at the Academy has been sufficiently formalized, and is sufficiently interdependent,
so as to bring that committee's activities within the definition of governmental
activity for the purposes of our review. While the Academy has long had the
informal practice of referring all alleged violations to the Cadet Honor Committee,
the relationship between that committee and the separation process has to a
degree been formalized. x x x
Regardless of whether the relationship be deemed formal or informal, the Honor
Committee under its own procedures provides that a single "not guilty" vote by a
member ends the matter, while a "guilty" finding confronts a cadet with the hard
choice of either resigning or electing to go before a Board of Officers. An adverse
finding there results not only in formal separation from the Academy but also in a
damaging record that will follow the cadet through life. Accordingly, we conclude
that the Cadet Honor Committee, acting not unlike a grand jury, is clearly part of
the process whereby a cadet can ultimately be adjudged to have violated the
Cadet Honor Code and be separated from the Academy. Therefore, the effect of
the committee's procedures and determinations on the separation process is
sufficiently intertwined with the formal governmental activity which may follow as to
bring it properly under judicial review92
No one is above the law, including the military. In fact, the present Constitution
declares it as a matter of principle that civilian authority is, at all times, supreme
over the military.93 Consistent with the republican system of checks and balances,
the Court has been entrusted, expressly or by necessary implication, with both the
duty and the obligation of determining, in appropriate cases, the validity of any
assailed legislative or executive action.94
SUBSTANTIVE GROUNDS
Cadet's relinquishment of certain civil liberties
Respondents assert that the standard of rights applicable to a cadet is not the
same as that of a civilian because the former' s rights have already been
recalibrated to best serve the military purpose and necessity. They claim that both
Gudani and Lt. Col. Kapunan, Jr. v. Gen. De Villa95 recognized that, to a certain
degree, individual rights of persons in the military service may be curtailed by the
rules of military discipline in order to ensure its effectiveness in fulfilling the duties
required to be discharged under the law. Respondents remind that, as a military
student aspiring to a commissioned post in the military service, Cadet 1 CL Cudia
voluntarily gave up certain civil and political rights which the rest of the civilian
population enjoys. The deliberate surrender of certain freedoms on his part is
embodied in the cadets' Honor Code Handbook. It is noted that at the beginning of
their academic life in the PMA, Cadet 1 CL Cudia, along with the rest of Cadet
Corps, took an oath and undertaking to stand by the Honor Code and the Honor
System.
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To say that a PMA cadet surrenders his fundamental human rights, including the
right to due process, is, for petitioners, contrary to the provisions of Section 3,
Article II of the 1987 Constitution,96 Executive Order (E.O.) No. 17897 (as amended
by E.O. No. 100598), AFP Code of Ethics, Oath of Cadet Corps to the Honor Code
and the Honor System, military professionalism, and, in general, military culture.
They maintain that the HC, the CRAB, and the PMA, grossly and in bad faith
misapplied the Honor Code and the Honor System in deciding Cadet lCL Cudia's
case considering that these should not be implemented at the expense of human
rights, due process, and fair play. Further, under the doctrine of constitutional
supremacy, they can never overpower or defy the 1987 Constitution since the
former should yield to the latter. Petitioners stress that the statement that "a cadet
can be compelled to surrender some civil rights and liberties in order for the Code
and System to be implemented" simply pertains to what cadets have to sacrifice in
order to prove that they are men or women of integrity and honor, such as the right
to entertain vices and the right to freely choose what they want to say or do. In the
context of disciplinary investigation, it does not contemplate a surrender of the right
to due process but, at most, refers to the cadets' rights to privacy and to remain
silent.
We concur with the stand of petitioners.
Of course, a student at a military academy must be prepared to subordinate his
private interests for the proper functioning of the educational institution he attends
to, one that is with a greater degree than a student at a civilian public school. 99 In
fact, the Honor Code and Honor System Handbook of the PMA expresses that,
"[as] a training environment, the Cadet Corps is a society which has its own norms.
Each member binds himself to what is good for him, his subordinates, and his
peers. To be part of the Cadet Corps requires the surrender of some basic rights
and liberties for the good of the group."100
It is clear, however, from the teachings of Wasson and Hagopian, which were
adopted by Andrews, that a cadet facing dismissal from the military academy for
misconduct has constitutionally protected private interests (life, liberty, or property);
hence, disciplinary proceedings conducted within the bounds of procedural due
process is a must.101For that reason, the PMA is not immune from the strictures of
due process. Where a person's good name, reputation, honor, or integrity is at
stake because of what the government is doing to him, the minimal requirements
of the due process clause must be satisfied. 102 Likewise, the cadet faces far more
severe sanctions of being expelled from a course of college instruction which he or
she has pursued with a view to becoming a career officer and of probably
being forever denied that career.103
The cases of Gudani and Kapunan, Jr. are inapplicable as they do not specifically
pertain to dismissal proceedings of a cadet in a military academy due to honor
violation. In Gudani, the Court denied the petition that sought to annul the directive
from then President Gloria Macapagal-Arroyo, which' enjoined petitioners from
testifying before the Congress without her consent. We ruled that petitioners may
be subjected to military discipline for their defiance of a direct order of the AFP
Chief of Staff. On the other hand, in Kapunan, Jr., this Court upheld the restriction
imposed on petitioner since the conditions for his "house arrest" (particularly, that
he may not issue any press statements or give any press conference during the
period of his detention) are justified by the requirements of military discipline. In
these two cases, the constitutional rights to information, transparency in matters of
public concern, and to free speech - not to due process clause - were restricted to
better serve the greater military purpose. Academic freedom of the PMA
Petitioners posit that there is no law providing that a guilty finding by the HC may
be used by the PMA to dismiss or recommend the dismissal of a cadet from the
PMA. They argue that Honor Code violation is not among those listed as
justifications for the attrition of cadets considering that the Honor Code and the
Honor System do not state that a guilty cadet is automatically terminated or
dismissed from service. To them, the Honor Code and Honor System are
"gentleman's agreement" that cannot take precedence over public interest - in the
defense of the nation and in view of the taxpayer's money spent for each cadet.
Petitioners contend that, based on the Civil Code, all written or verbal agreements
are null and void if they violate the law, good morals, good customs, public policy,
and public safety.
In opposition, respondents claim that the PMA may impose disciplinary measures
and punishment as it deems fit and consistent with the peculiar needs of the
Academy. Even without express provision of a law, the PMA has regulatory
authority to administratively dismiss erring cadets since it is deemed reasonably
written into C.A. No. 1. Moreover, although said law grants to the President the
authority of terminating a cadet's appointment, such power may be delegated to
the PMA Superintendent, who may exercise direct supervision and control over the
cadets.
Respondents likewise contend that, as an academic institution, the PMA has the
inherent right to promulgate reasonable norms, rules and regulations that it may
deem necessary for the maintenance of school discipline, which is specifically
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mandated by Section 3 (2),104 Article XIV of the 1987 Constitution. As the premiere
military educational institution of the AFP in accordance with Section 30, 105 Article
III of C.A. No. 1 and Sections 58 and 59,106 Chapter 9, Subtitle II, Title VIII, Book IV
of E.O. No. 292 ("Administrative Code of 1987"), the PMA is an institution that
enjoys academic freedom guaranteed by Section 5 (2), 107 Article XIV of the 1987
Constitution. In Miriam College Foundation, Inc. v. Court of Appeals, 108 it was held
that concomitant with such freedom is the right and duty to instill and impose
discipline upon its students. Also, consistent with lsabelo, Jr. v. Perpetual Help
College of Rizal, Inc.109 and Ateneo de Manila University v. Capulong,110 the PMA
has the freedom on who to admit (and, conversely, to expel) given the high degree
of discipline and honor expected from its students who are to form part of the AFP.
For respondents, Cadet 1 CL Cudia cannot, therefore, belatedly assail the Honor
Code as basis of the HC' s decision to recommend his dismissal from the PMA.
When he enlisted for enrolment and studied in the PMA for four years, he knew or
should have been fully aware of the standards of discipline imposed on all cadets
and the corresponding penalty for failing to abide by these standards.
In their Reply, petitioners counter that, as shown in lsabelo, Jr. and Ateneo,
academic freedom is not absolute and cannot be exercised in blatant disregard of
the right to due process and the 1987 Constitution. Although schools have the
prerogative to choose what to teach, how to teach, and who to teach, the same
does not go so far as to deprive a student of the right to graduate when there is
clear evidence that he is entitled to the same since, in such a case, the right to
graduate becomes a vested right which takes precedence over the limited and
restricted right of the educational institution.
While both parties have valid points to consider, the arguments of respondents are
more in line with the facts of this case. We have ruled that the school-student
relationship is contractual in nature. Once admitted, a student's enrolment is not
only semestral in duration but for the entire period he or she is expected to
complete it.111 An institution of learning has an obligation to afford its students a
fair opportunity to complete the course they seek to pursue.112 Such contract is
imbued with public interest because of the high priority given by the Constitution to
education and the grant to the State of supervisory and regulatory powers over a
educational institutions.113
The school-student relationship has also been held as reciprocal. "[It] has
consequences appurtenant to and inherent in all contracts of such kind -it gives
rise to bilateral or reciprocal rights and obligations. The school undertakes to
provide students with education sufficient to enable them to pursue higher
education or a profession. On the other hand, the students agree to abide by the
academic requirements of the school and to observe its rules and regulations."114
Academic freedom or, to be precise, the institutional autonomy of universities and
institutions of higher learning,115has been enshrined in our Constitutions of 1935,
1973, and 1987.116 In Garcia, this Court espoused the concurring opinion of U.S.
Supreme Court Justice Felix Frankfurter in Sweezy v. New Hampshire,117 which
enumerated "the four essential freedoms" of a university: To determine for itself on
academic grounds (1) who may teach, (2) what may be taught, (3) how it shall be
taught, and (4) who may be admitted to study.118 An educational institution has the
power to adopt and enforce such rules as may be deemed expedient for its
government, this being incident to the very object of incorporation, and
indispensable to the successful management of the college.119 It can decide for
itself its aims and objectives and how best to attain them, free from outside
coercion or interference except when there is an overriding public welfare which
would call for some restraint.120 Indeed, "academic freedom has never been meant
to be an unabridged license. It is a privilege that assumes a correlative duty to
exercise it responsibly. An equally telling precept is a long recognized mandate, so
well expressed in Article 19 of the Civil Code, that every 'person must, in the
exercise of his rights and in the performance of his duties, act with justice, give
everyone his due, and observe honesty and good faith."'121
The schools' power to instill discipline in their students is subsumed in their
academic freedom and that "the establishment of rules governing university-
student relations, particularly those pertaining to student discipline, may be
regarded as vital, not merely to the smooth and efficient operation of the institution,
but to its very survival."122 As a Bohemian proverb puts it: "A school without
discipline is like a mill without water." Insofar as the water turns the mill, so does
the school's disciplinary power assure its right to survive and continue
operating.123 In this regard, the Court has always recognized the right of schools to
impose disciplinary sanctions, which includes the power to dismiss or expel, on
students who violate disciplinary rules.124 In Miriam College Foundation, Inc. v.
Court of Appeals,125 this Court elucidated:
The right of the school to discipline its students is at once apparent in the third
freedom, i.e., "how it shall be taught." A school certainly cannot function in an
atmosphere of anarchy.
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Thus, there can be no doubt that the establishment of an educational institution
requires rules and regulations necessary for the maintenance of an orderly
educational program and the creation of an educational environment conducive to
learning. Such rules and regulations are equally necessary for the protection of the
students, faculty, and property.
Moreover, the school has an interest in teaching the student discipline, a
necessary, if not indispensable, value in any field of learning. By instilling
discipline, the school teaches discipline. Accordingly, the right to discipline the
student likewise finds basis in the freedom "what to teach." Incidentally, the school
not only has the right but the duty to develop discipline in its students. The
Constitution no less imposes such duty.
[All educational institutions] shall inculcate patriotism and nationalism, foster love
of humanity, respect for human rights, appreciation of the role of national heroes in
the historical development of the country, teach the rights and duties of citizenship,
strengthen ethical and spiritual values, develop moral character and personal
discipline, encourage critical and creative thinking, broaden scientific and
technological knowledge, and promote vocational efficiency.
In Angeles vs. Sison, we also said that discipline was a means for the school to
carry out its responsibility to help its students "grow and develop into mature,
responsible, effective and worthy citizens of the community."
Finally, nowhere in the above formulation is the right to discipline more evident
than in "who may be admitted to study." If a school has the freedom to determine
whom to admit, logic dictates that it also has the right to determine whom to
exclude or expel, as well as upon whom to impose lesser sanctions such as
suspension and the withholding of graduation privileges.126
The power of the school to impose disciplinary measures extends even after
graduation for any act done by the student prior thereto. In University of the Phils.
Board of Regents v. Court of Appeals,127 We upheld the university's withdrawal of
a doctorate degree already conferred on a student who was found to have
committed intellectual dishonesty in her dissertation. Thus:
Art. XIV, §5 (2) of the Constitution provides that "[a]cademic freedom shall be
enjoyed in all institutions of higher learning." This is nothing new. The 1935
Constitution and the 1973 Constitution likewise provided for the academic freedom
or, more precisely, for the institutional autonomy of universities and institutions of
higher learning. As pointed out by this Court in Garcia v. Faculty Admission
Committee, Loyola School of Theology, it is a freedom granted to "institutions of
higher learning" which is thus given "a wide sphere of authority certainly extending
to the choice of students." If such institution of higher learning can decide who can
and who cannot study in it, it certainly can also determine on whom it can confer
the honor and distinction of being its graduates.
Where it is shown that the conferment of an honor or distinction was obtained
through fraud, a university has the right to revoke or withdraw the honor or
distinction it has thus conferred. This freedom of a university does not terminate
upon the "graduation" of a student, .as the Court of Appeals held. For it is precisely
the "graduation" of such a student that is in question. It is noteworthy that the
investigation of private respondent's case began before her graduation. If she was
able to join the graduation ceremonies on April 24, 1993, it was because of too
many investigations conducted before the Board of Regents finally decided she
should not have been allowed to graduate.
Wide indeed is the sphere of autonomy granted to institutions of higher learning,
for the constitutional grant of academic freedom, to quote again from Garcia v.
Faculty Admission Committee, Loyola School of Theology, "is not to be construed
in a niggardly manner or in a grudging fashion."
Under the U.P. Charter, the Board of Regents is the highest governing body of the
University of the Philippines. It has the power to confer degrees upon the
recommendation of the University Council. It follows that if the conferment of a
degree is founded on error or fraud, the Board of Regents is also empowered,
subject to the observance of due process, to withdraw what it has granted without
violating a student's rights. An institution of higher learning cannot be powerless if
it discovers that an academic degree it has conferred is not rightfully deserved.
Nothing can be more objectionable than bestowing a university's highest academic
degree upon an individual who has obtained the same through fraud or deceit. The
pursuit of academic excellence is the university's concern. It should be
empowered, as an act of self-defense, to take measures to protect itself from
serious threats to its integrity.
While it is true that the students are entitled to the right to pursue their education,
the USC as an educational institution is also entitled to pursue its academic
freedom and in the process has the concomitant right to see to it that this freedom
is not jeopardized.128
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It must be borne in mind that schools are established, not merely to develop the
intellect and skills of the studentry, but to inculcate lofty values, ideals and
attitudes; nay, the development, or flowering if you will, of the total
man.129Essentially, education must ultimately be religious, i.e., one which
inculcates duty and reverence.130 Under the rubric of "right to education," students
have a concomitant duty to learn under the rules laid down by the school. 131 Every
citizen has a right to select a profession or, course of study, subject to fair,
reasonable, and equitable admission and academic requirements. 132 The PMA is
not different. As the primary training and educational institution of the AFP, it
certainly has the right to invoke academic freedom in the enforcement of its
internal rules and regulations, which are the Honor Code and the Honor System in
particular.
The Honor Code is a set of basic and fundamental ethical and moral principle. It is
the minimum standard for cadet behavior and serves as the guiding spirit behind
each cadet's action. It is the cadet's responsibility to maintain the highest standard
of honor. Throughout a cadet's stay in the PMA, he or she is absolutely bound
thereto. It binds as well the members of the Cadet Corps from its alumni or the
member of the so-called "Long Gray Line."
Likewise, the Honor Code constitutes the foundation for the cadets' character
development. It defines the desirable values they must possess to remain part of
the Corps; it develops the atmosphere of trust so essential in a military
organization; and it makes them professional military soldiers.133 As it is for
character building, it should not only be kept within the society of cadets. It is best
adopted by the Cadet Corps with the end view of applying it outside as an officer of
the AFP and as a product of the PMA.134
The Honor Code and System could be justified as the primary means of achieving
the cadets' character development and as ways by which the Academy has
chosen to identify those who are deficient in conduct.135 Upon the Code rests the
ethical standards of the Cadet Corps and it is also an institutional goal, ensuring
that graduates have strong character, unimpeachable integrity, and moral
standards of the highest order.136 To emphasize, the Academy's disciplinary
system as a whole is characterized as "correctional and educational in nature
rather than being legalistic and punitive." Its purpose is to teach the cadets "to be
prepared to accept full responsibility for all that they do or fail to do and to place
loyalty to the service above self-interest or loyalty to friends or associates.
"137Procedural safeguards in a student disciplinary case
Respondents stress that Guzman v. National University138 is more appropriate in
determining the minimum standards for the imposition of disciplinary sanctions in
academic institutions. Similarly, with the guideposts set in Andrews, they believe
that Cadet 1 CL Cudia was accorded due process.
On the other hand, petitioners argue that the HC, the CRAB and the PMA fell short
in observing the important safeguards laid down in Ang Tibay v. CIR 139 and Non v.
Judge Dames II,140 which set the minimum standards to satisfy the demands of
procedural due process in the imposition of disciplinary sanctions. For them,
Guzman did not entirely do away with the due process requirements outlined in
Ang Tibay as the Court merely stated that the minimum requirements in the
Guzman case are more apropos.
Respondents rightly argued.
Ateneo de Manila University v. Capulong141 already settled the issue as it held that
although both Ang Tibay and Guzman essentially deal with the requirements of
due process, the latter case is more apropos since it specifically deals with the
minimum standards to be satisfied in the imposition of disciplinary sanctions in
academic institutions. That Guzman is the authority on the procedural rights of
students in disciplinary cases was reaffirmed by the Court in the fairly recent case
of Go v. Colegio De San Juan De Letran.142
In Guzman, the Court held that there are minimum standards which must be met to
satisfy the demands of procedural due process, to wit:
(1) the students must be informed in writing of the nature and cause of any
accusation against them; (2) they shall have the right to answer the charges
against them, with the assistance of counsel, if desired; (3) they shall be informed
of the evidence against them; ( 4) they shall have the right to adduce evidence in
their own behalf; and (5) the evidence must be duly considered by the investigating
committee or official designated by the school authorities to hear and decide the
case.143
We have been consistent in reminding that due process in disciplinary cases
involving students does not entail proceedings and hearings similar to those
prescribed for actions and proceedings in courts of justice;144 that the proceedings
may be summary;145 that cross-examination is not an essential part of the
investigation or hearing;146and that the required proof in a student disciplinary
action, which is an administrative case, is neither proof beyond reasonable doubt
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nor preponderance of evidence but only substantial evidence or "such relevant
evidence as a reasonable mind might accept as adequate to support a
conclusion."147
What is crucial is that official action must meet minimum standards of fairness to
the individual, which generally encompass the right of adequate notice and a
meaningful opportunity to be heard.148 As held in De La Salle University, Inc. v.
Court of Appeals:149
Notice and hearing is the bulwark of administrative due process, the right to which
is among the primary rights that must be respected even in administrative
proceedings. The essence of due process is simply an opportunity to be heard, or
as applied to administrative proceedings, an opportunity to explain one's side or an
opportunity to seek reconsideration of the action or ruling complained of. So long
as the party is given the opportunity to advocate her cause or defend her interest
in due course, it cannot be said that there was denial of due process.
A formal trial-type hearing is not, at all times and in all instances, essential to due
process - it is enough that the parties are given a fair and reasonable opportunity
to explain their respective sides of the controversy and to present supporting
evidence on which a fair decision can be based. "To be heard" does not only mean
presentation of testimonial evidence in court - one may also be heard through
pleadings and where the opportunity to be heard through pleadings is accorded,
there is no denial of due process.150
The PMA Honor Code explicitly recognizes that an administrative proceeding
conducted to investigate a cadet's honor violation need not be clothed with the
attributes of a judicial proceeding. It articulates that – The Spirit of the Honor Code
guides the Corps in identifying and assessing misconduct. While cadets are
interested in legal precedents in cases involving Honor violations, those who hold
the Spirit of the Honor Code dare not look into these precedents for loopholes to
justify questionable acts and they are not to interpret the system to their own
advantage.
The Spirit of the Honor Code is a way for the cadets to internalize Honor in a
substantive way. Technical and procedural misgivings of the legal systems may
avert the true essence of imparting the Spirit of the Code for the reason that it can
be used to make unlawful attempt to get into the truth of matters especially when a
cadet can be compelled to surrender some civil rights and liberties in order for the
Code and System to be implemented. By virtue of being a cadet, a member of the
CCAFP becomes a subject of the Honor Code and System. Cadet's actions are
bound by the existing norms that are logically applied through the Code and
System in order to realize the Academy's mission to produce leaders of character -
men of integrity and honor.151
One of the fundamental principles of the Honor System also states:
2. The Honor System correlates with legal procedures of the state's Justice
System but it does not demean its Spirit by reducing the Code to a systematic list
of externally observed rules. Where misinterpretations and loopholes arise through
legalism and its technicalities, the objective of building the character of the cadets
becomes futile. While, generally, Public Law penalizes only the faulty acts, the
Honor System tries to examine both the action and the intention.152
Like in other institutions of higher learning, there is aversion towards undue
judicialization of an administrative hearing in the military academy. It has been said
that the mission of the military is unique in the sense that its primary business is to
fight or be ready to fight wars should the occasion arise, and that over-
proceduralizing military determinations necessarily gives soldiers less time to
accomplish this task.153 Extensive cadet investigations and complex due process
hearing could sacrifice simplicity, practicality, and timeliness. Investigations that
last for several days or weeks, sessions that become increasingly involved with
legal and procedural' points, and legal motions and evidentiary objections that are
irrelevant and inconsequential tend to disrupt, delay, and confuse the dismissal
proceedings and make them unmanageable. Excessive delays cannot be tolerated
since it is unfair to the accused, to his or her fellow cadets, to the Academy, and,
generally, to the Armed Forces. A good balance should, therefore, be struck to
achieve fairness, thoroughness, and efficiency.154 Considering that the case of
Cadet 1 CL Cudia is one of first impression in the sense that this Court has not
previously dealt with the particular issue of a dismissed cadet's right to due
process, it is necessary for Us to refer to U.S. jurisprudence for some guidance.
Notably, our armed forces have been patterned after the U.S. Army and the U.S.
military code produced a salutary effect in the military justice system of the
Philippines.155 Hence, pertinent case laws interpreting the U.S. military code and
practices have persuasive, if not the same, effect in this jurisdiction.
We begin by stating that U.S. courts have uniformly viewed that "due process" is a
flexible concept, requiring consideration in each case of a variety of circumstances
and calling for such procedural protections as the particular situation
demands.156 Hagopian opined:
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In approaching the question of what process is due before governmental action
adversely affecting private interests may properly be taken, it must be recognized
that due process is not a rigid formula or simple rule of thumb to be applied
undeviatingly to any given set of facts. On the contrary, it is a flexible concept
which depends upon the balancing of various factors, including the nature of the
private right or interest that is threatened, the extent to which the proceeding is
adversarial in character, the severity and consequences of any action that might
be taken, the burden that would be imposed by requiring use of all or part of the
full panoply of trial-type procedures, and the existence of other overriding interests,
such as the necessity for prompt action in the conduct of crucial military
operations. The full context must therefore be considered in each
case.157 (Emphasis supplied)
Wasson, which was cited by Hagopian, broadly outlined the minimum standards of
due process required in the dismissal of a cadet. Thus:
[W]hen the government affects the private interests of individuals, it may not
proceed arbitrarily but must observe due process of law. x x x Nevertheless, the
flexibility which is inherent in the concept of due process of law precludes the
dogmatic application of specific rules developed in one context to entirely distinct
forms of government action. "For, though 'due process of law' generally implies
and includes actor, reus, judex, regular allegations, opportunity to answer, and a
trial according to some settled course of judicial proceedings, * * * yet, this is not
universally true." x x x Thus, to determine in any given case what procedures due
process requires, the court must carefully determine and balance the nature of the
private interest affected and of the government interest involved, taking account of
history and the precise circumstances surrounding the case at hand.
While the government must always have a legitimate concern with the subject
matter before it may validly affect private interests, in particularly vital and sensitive
areas of government concern such as national security and military affairs, the
private interest must yield to a greater degree to the governmental. x x x Few
decisions properly rest so exclusively within the discretion of the appropriate
government officials than the selection, training, discipline and dismissal of the
future officers of the military and Merchant Marine. Instilling and maintaining
discipline and morale in these young men who will be required to bear weighty
responsibility in the face of adversity -- at times extreme -- is a matter of
substantial national importance scarcely within the competence of the judiciary.
And it cannot be doubted that because of these factors historically the military has
been permitted greater freedom to fashion its disciplinary procedures than the
civilian authorities.
We conclude, therefore, that due process only requires for the dismissal of a Cadet
from the Merchant Marine Academy that he be given a fair hearing at which he is
apprised of the charges against him and permitted a defense. x x x For the
guidance of the parties x x x the rudiments of a fair hearing in broad outline are
plain. The Cadet must be apprised of the specific charges against him. He must be
given an adequate opportunity to present his defense both from the point of view of
time and the use of witnesses and other evidence. We do not suggest, however,
that the Cadet must be given this opportunity both when demerits are awarded and
when dismissal is considered. The hearing may be procedurally informal and need
not be adversarial.158 (Emphasis supplied)
In Andrews, the U.S. Court of Appeals held that Wasson and Hagopian are equally
controlling in cases where cadets were separated from the military academy for
violation of the Honor Code. Following the two previous cases, it was ruled that in
order to be proper and immune from constitutional infirmity, a cadet who is sought
to be dismissed or separated from the academy must be afforded a hearing, be
apprised of the specific charges against him, and be given an adequate
opportunity to present his or her defense both from the point of view of time and
the use of witnesses and other evidence.159 Conspicuously, these vital conditions
are not too far from what We have already set in Guzman and the subsequent
rulings in Alcuaz v. Philippine School of Business Administration 160 and De La
Salle University, Inc. v. Court of Appeals.161
In this case, the investigation of Cadet 1 CL Cudia' s Honor Code violation
followed the prescribed procedure and existing practices in the PMA. He was
notified of the Honor Report from Maj. Hindang. He was then given the opportunity
to explain the report against him. He was informed about his options and the entire
process that the case would undergo. The preliminary investigation immediately
followed after he replied and submitted a written explanation. Upon its completion,
the investigating team submitted a written report together with its recommendation
to the HC Chairman. The HC thereafter reviewed the findings and
recommendations. When the honor case was submitted for formal investigation, a
new team was assigned to conduct the hearing. During the formal
investigation/hearing, he was informed of the charge against him and given the
right to enter his plea. He had the chance to explain his side, confront the
witnesses against him, and present evidence in his behalf. After a thorough
discussion of the HC voting members, he was found to have violated the ' Honor
Code. Thereafter, the guilty verdict underwent the review process at the Academy
level - from the OIC of the HC, to the SJA, to the Commandant of Cadets, and to
the PMA Superintendent. A separate investigation was also conducted by the
HTG. Then, upon the directive of the AFP-GHQ to reinvestigate the case, a review
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was conducted by the CRAB. Further, a Fact-Finding Board/Investigation Body
composed of the CRAB members and the PMA senior officers was constituted to
conduct a deliberate investigation of the case. Finally, he had the opportunity to
appeal to the President. Sadly for him, all had issued unfavorable rulings.
It is well settled that by reason of their special knowledge and expertise gained
from the handling of specific matters falling under their respective jurisdictions, the
factual findings of administrative tribunals are ordinarily accorded respect if not
finality by the Court, unless such findings are not supported by evidence or vitiated
by fraud, imposition or collusion; where the procedure which led to the findings is
irregular; when palpable errors are committed; or when a grave abuse of
discretion, arbitrariness, or capriciousness is manifest.162 In the case of Cadet 1
CL Cudia, We find no reason to deviate from the general rule. The grounds
therefor are discussed below seriatim:
As to the right to be represented by a counsel –
For petitioners, respondents must be compelled to give Cadet 1 CL Cudia the right
to be represented by a counsel who could actively participate in the proceedings
like in the cross-examination of the witnesses against him before the CRAB or HC,
if remanded. This is because while the CRAB allowed him to be represented by a
PAO lawyer, the counsel was only made an observer without any right to intervene
and demand respect of Cadet 1 CL Cudia's rights.163 According to them, he was
not sufficiently given the opportunity to seek a counsel and was not even asked if
he would like to have one. He was only properly represented when it was already
nearing graduation day after his family sought the assistance of the PAO.
Petitioners assert that Guzman is specific in stating that the erring student has the
right to answer the charges against him or her with the assistance of counsel, if
desired.
On the other hand, respondents cited Lumiqued v. Exevea164 and Nera v. The
Auditor General165 in asserting that the right to a counsel is not imperative in
administrative investigations or non-criminal proceedings. Also, based on Cadet
lCL Cudia's academic standing, he is said to be obviously not untutored to fully
understand his rights and express himself. Moreover, the confidentiality of the HC
proceedings worked against his right to be represented by a counsel. In any event,
respondents claim that Cadet 1 CL Cudia was not precluded from seeking a
counsel's advice in preparing his defense prior to the HC hearing.
Essentially, petitioners claim .. that Cadet lCL Cudia is guaranteed the right to
have his counsel not just in assisting him in the preparation for the investigative
hearing before the HC and the CRAB but in participating fully in said hearings. The
Court disagrees.
Consistent with Lumiqued and Nera, there is nothing in the 1987 Constitution
stating that a party in a non-litigation proceeding is entitled to be represented by
counsel. The assistance of a lawyer, while desirable, is not indispensable. Further,
in Remolona v. Civil Service Commission,166 the Court held that "a party in an
administrative inquiry may or may not be assisted by counsel, irrespective of the
nature of the charges and of the respondent's capacity to represent himself, and
no duty rests on such body to furnish the person being investigated with counsel."
Hence, the administrative body is under no duty to provide the person with counsel
because assistance of counsel is not an absolute requirement.
More in point is the opinion in Wasson, which We adopt. Thus:
The requirement of counsel as an ingredient of fairness is a function of all of the
other aspects of the hearing. Where the proceeding is non-criminal in nature,
where the hearing is investigative and not adversarial and the government does
not proceed through counsel, where the individual concerned is mature and
educated, where his knowledge of the events x x x should enable him to develop
the facts adequately through available sources, and where the other aspects of the
hearing taken as a whole are fair, due process does not require representation by
counsel.167
To note, U.S. courts, in general, have declined to recognize a right to
representation by counsel, as a function of due process, in military academy
disciplinary proceedings.168 This rule is principally motivated by the policy of
"treading lightly on the military domain, with scrupulous regard for the power and
authority of the military establishment to govern its own affairs within the broad
confines of constitutional due process" and the courts' views that disciplinary
proceedings are not judicial in nature and should be kept informal, and that literate
and educated cadets should be able to defend themselves.169 In Hagopian, it was
ruled that the importance of informality in the proceeding militates against a
requirement that the cadet be accorded the right to representation by counsel
before the Academic Board and that unlike the welfare recipient who lacks the
training and education needed to understand his rights and express himself, the
cadet should be capable of doing so.170 In the subsequent case of Wimmer v.
Lehman,171 the issue was not access to counsel but the opportunity to have
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counsel, instead of oneself, examine and cross-examine witnesses, make
objections, and argue the case during the hearing. Disposing of the case, the U.S.
Court of Appeals for the Fourth Circuit was not persuaded by the argument that an
individual of a midshipman's presumed intelligence, selected because he is
expected to be able to care for himself and others, often under difficult
circumstances, and who has full awareness of what he is facing, with counsel's
advice, was deprived of due process by being required to present his defense in
person at an investigatory hearing.
In the case before Us, while the records are bereft of evidence that Cadet 1 CL
Cudia was given the option or was able to seek legal advice prior to and/or during
the HC hearing, it is indubitable that he was assisted by a counsel, a PAO lawyer
to be exact, when the CRAB reviewed and reinvestigated the case. The
requirement of due process is already satisfied since, at the very least, the counsel
aided him in the drafting and filing of the Appeal Memorandum and even acted as
an observer who had no right to actively participate in the proceedings (such as
conducting the cross-examination). Moreover, not to be missed out are the facts
that the offense committed by Cadet 1 CL Cudia is not criminal in nature; that the
hearings before the HC and the CRAB were investigative and not adversarial; and
that Cadet lCL Cudia's excellent-academic standing puts him in the best position to
look after his own vested interest in the Academy.
As to the confidentiality of records of the proceedings –
Petitioners allege that when Maj. Gen. Lopez denied in his March 11, 2014 letter
Cadet lCL Cudia's request for documents, footages, and recordings relevant to the
HC hearings, the vital evidence negating the regularity of the HC trial and
supporting his defense have been surely overlooked by the CRAB in its case
review. Indeed, for them, the answers on whether Cadet 1 CL Cudia was deprived
of due process and whether he lied could easily be unearthed from the video and
other records of the HC investigation. Respondents did not deny their existence
but they refused to present them for the parties and the Court to peruse. In
particular, they note that the Minutes of the HC dated January 21, 2014 and the
HC Formal Investigation Report dated January 20, 2014 were considered by the
CRAB but were not furnished to petitioners and the Court; hence, there is no way
to confirm the truth of the alleged statements therein. In their view, failure to furnish
these documents could only mean that it would be adverse if produced pursuant to
Section 3 (e), Rule 131 of the Rules of Court.172
For lack of legal basis on PMA' s claim of confidentiality of records, petitioners
contend that it is the ministerial duty of the HC to submit to the CRAB, for the
conduct of intelligent review of the case, all its records of the proceedings,
including video footages of the deliberations and voting. They likewise argue that
PMA' s refusal to release relevant documents to Cadet 1 CL Cudia under the guise
of confidentiality reveals another misapplication of the Honor Code, which merely
provides: "A cadet who becomes part of any investigation is subject to the existing
regulations pertaining to rules of confidentiality and, therefore, must abide to the
creed of secrecy. Nothing shall be disclosed without proper guidance from those
with authority" (IV. The Honor System, Honor Committee, Cadet Observer). This
provision, they say, does not deprive Cadet 1 CL Cudia of his right to obtain copies
and examine relevant documents pertaining to his case.
Basically, petitioners want Us to assume that the documents, footages, and
recordings relevant to the HC hearings are favorable to Cadet 1 CL Cudia's cause,
and, consequently, to rule that respondents' refusal to produce and have them
examined is tantamount to the denial of his right to procedural due process. They
are mistaken.
In this case, petitioners have not particularly identified any documents, witness
testimony, or oral or written presentation of facts submitted at the hearing that
would support Cadet 1 CL Cudia's defense. The Court may require that an
administrative record be supplemented, but only "where there is a 'strong showing
or bad faith or improper behavior' on the part of the agency,"173 both of which are
not present here. Petitioners have not specifically indicated the nature of the
concealed evidence, if any, and the reason for withholding it. What they did was
simply supposing that Cadet 1 CL Cudia's guilty verdict would be overturned with
the production and examination of such documents, footages, and recordings. As
will be further shown in the discussions below, the requested matters, even if
denied, would not relieve Cadet 1 CL Cudia's predicament. If at all, such denial
was a harmless procedural error since he was not seriously prejudiced thereby.
As to the ostracism in the PMA –
To petitioners, the CRAB considered only biased testimonies and evidence
because Special Order No. 1 issued on February 21, 2014, which directed the
ostracism of Cadet 1 CL Cudia, left him without any opportunity, to secure
statements of his own witnesses. He could not have access to or approach the
cadets who were present during the trial and who saw the 8-1 voting result. It is
argued that the Order directing Cadet 1 CL Cudia's ostracism is of doubtful legal
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validity because the Honor Code unequivocally announced: "x x x But by
wholeheartedly dismissing the cruel method of ostracizing Honor Code violators,
PMA will not have to resort to other humiliating means and shall only have the
option to make known among its alumni the names of those who have not
sincerely felt remorse for violating the Honor Code."
On their part, respondents assert that neither the petition nor the petition-in-
intervention attached a full text copy of the alleged Special Order No. 1. In any
case, attributing its issuance to PMA is improper and misplaced because of
petitioners' admission that ostracism has been absolutely dismissed as an
Academy-sanctioned activity consistent with the trend in International
Humanitarian Law that the PMA has included in its curriculum. Assuming that said
Order was issued, respondents contend that it purely originated from the cadets
themselves, the sole purpose of which was to give a strong voice to the Cadet
Corps by declaring that they did not tolerate Cadet 1 CL Cudia's honor violation
and breach of confindentiality of the HC proceedings.
More importantly, respondents add that it is highly improbable and unlikely that
Cadet 1 CL Cudia was ostracized by his fellow cadets. They manifest that as early
as January 22, 2014, he was already transferred to the Holding Center. The
practice of billeting an accused cadet at the Holding Center is provided for in the
Honor Code Handbook. Although within the PMA compound, the Holding Center is
off-limits to cadets who do not have any business to conduct therein. The cadets
could not also ostracize him during mess times since Cadet 1 CL Cudia opted to
take his meals at the Holding Center. The circumstances obtaining when Special
Order No. 1 was issued clearly foreclose the possibility that he was ostracized in
common areas accessible to other cadets. He remained in the Holding Center until
March 16, 2014 when he voluntarily left the PMA. Contrary to his claim, guests
were also free to visit him in the Holding Center.
However, petitioners swear that Cadet 1 CL Cudia suffered from ostracism in the
PMA. The practice was somehow recognized by respondents in their Consolidated
Comment and by PMA Spokesperson Maj. Flores in a news report. The CHR
likewise confirmed the same in its Resolution dated May 22, 2014. For them, it
does not matter where the ostracism order originated from because the PMA
appeared to sanction it even if it came from the cadets themselves. There was a
tacit approval of an illegal act. If not, those cadets responsible for ostracism would
have been charged by the PMA officials. Finally, it is claimed that Cadet 1 CL
Cudia did not choose to take his meals at the Holding Center as he was not
allowed to leave the place. Petitioners opine that placing the accused cadet in the
Holding Center is inconsistent with his or her presumed innocence and certainly
gives the implication of ostracism.
We agree with respondents. Neither the petition nor the petition-inintervention
attached a full text copy or even a pertinent portion of the alleged Special Order
No. 1, which authorized the ostracism of Cadet 1 CL Cudia. Being hearsay, its
existence and contents are of doubtful veracity. Hence, a definite ruling on the
matter can never be granted in this case.
The Court cannot close its eyes though on what appears to be an admission of
Cadet 1 CL Mogol during the CHR hearing that, upon consultation with the entire
class, the baron, and the Cadet Conduct Policy Board, they issued an ostracism
order against Cadet 1 CL Cudia.174 While not something new in a military
academy,175 ostracism's continued existence in the modem times should no longer
be countenanced. There are those who argue that the "silence" is a punishment
resulting in the loss of private interests, primarily that of reputation, and that such
penalty may render illusory the possibility of vindication by the reviewing body
once found guilty by the HC.176 Furthermore, in Our mind, ostracism practically
denies the accused cadet's protected rights to present witnesses or evidence in his
or her behalf and to be presumed innocent until finally proven otherwise in a
proper proceeding.
As to Cadet 1 CL Cudia's stay in the Holding Center, the Court upholds the same.
The Honor Code and Honor System Handbook provides that, in case a cadet has
been found guilty by the HC of violating the Honor Code and has opted not to
resign, he or she may stay and wait for the disposition of the case. In such event,
the cadet is not on full-duty status and shall be billeted at the HTG Holding
Center.177 Similarly, in the U.S., the purpose of "Boarders Ward" is to quarter those
cadets who are undergoing separation actions. Permitted to attend classes, the
cadet is sequestered , therein until final disposition of the case. In Andrews, it was
opined that the segregation of cadets in the Ward was a proper exercise of the
discretionary authority of Academy officials. It relied on the traditional doctrine that
"with respect to decisions made by Army authorities, 'orderly government requires
us to tread lightly on the military domain, with scrupulous regard for the power and
authority of the military establishment to govern its own affairs within the broad
confines of constitutional due process.'" Also, in Birdwell v. Schlesinger, 178 the
"administrative segregation" was held to be a reasonable exercise of military
discipline and could not be considered an invasion of the rights to freedom of
speech and freedom of association.
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Late and vague decisions –
It is claimed that Cadet 1 CL Cudia was kept in the dark as to the charge against
him and the decisions arrived at by the HC, the CRAB, and the PMA. No written
decision was furnished to him, and if any, the information was unjustly belated and
the justifications for the decisions were vague. He had to constantly seek
clarification and queries just to be apprised of what he was confronted with.
Petitioners relate that upon being informed of the "guilty" verdict, Cadet 1 CL Cudia
immediately inquired as to the grounds therefor, but Cadet 1 CL Mogol answered
that it is confidential since he would still appeal the same. By March 11, 2014, Maj.
Gen. Lopez informed Cadet 1 CL Cudia that the CRAB already forwarded their
recommendation for his dismissal to the General Headquarters sometime in
February-March 2014. Even then, he received no decision/recommendation on his
case, verbally or in writing. The PMA commencement exercises pushed through
with no written decision from the CRAB or the PMA on his appeal. The letter from
the Office of the Adjutant General of the AFP was suspiciously delayed when the
Cudia family received the same only on March 20, 2014. Moreover, it fell short in
laying down with specificity the factual and legal bases used by the CRAB and
even by the Office of the Adjutant General. There remains no proof that the CRAB
and the PMA considered the evidence presented by Cadet 1 CL Cudia, it being
uncertain as to what evidence was weighed by the CRAB, whether the same is
substantial, and whether the new evidence submitted by him was ever taken into
account.
In refutation, respondents allege the existence of PMA's· practice of orally
declaring the HC finding, not putting it in a written document so as to protect the
integrity of the erring cadet and guard the confidentiality of the HC proceedings
pursuant to the Honor System. Further, they aver that a copy of the report of the
CRAB, dated March 10, 2014, was not furnished to Cadet 1 CL Cudia because it
was his parents who filed the appeal, hence, were the ones who were given a copy
thereof.
Petitioners' contentions have no leg to stand on. While there is a constitutional
mandate stating that "[no] decision shall be rendered by any court without
expressing therein clearly and distinctly the facts and the law on which it is
based,"179 such provision does not apply in Cadet 1 CL Cudia's case. Neither
Guzman nor Andrews require a specific form and content of a decision issued in
disciplinary proceedings. The Honor Code and Honor System Handbook also has
no written rule on the matter. Even if the provision applies, nowhere does it
demand that a point-by-point consideration and resolution of the issues raised by
the parties are necessary.180 What counts is that, albeit furnished to him late,
Cadet 1 CL Cudia was informed of how it was decided, with an explanation of the
factual and legal reasons that led to the conclusions of the reviewing body,
assuring that it went through the processes of legal reasoning. He was not left in
the dark as to how it was reached and he knows exactly the reasons why he lost,
and is able to pinpoint the possible errors for review.
As to the blind adoption of the HC findings –
Petitioners assert that, conformably with Sections 30 and 31 of C.A. No. 1, only
President Aquino as the Commander-in-Chief has the power to appoint and
remove a cadet for a valid/legal cause. The law gives no authority to the HC as the
sole body to determine the guilt or innocence of a cadet. It also does not empower
the PMA to adopt the guilty findings of the HC as a basis for recommending the
cadet's dismissal. In the case of Cadet 1 CL Cudia, it is claimed that the PMA
blindly followed the HC's finding of guilt in terminating his military service.
Further, it is the ministerial duty of the CRAB to conduct a review de nova of all
records without requiring Cadet 1 CL Cudia to submit new evidence if it is
physically impossible for him to do so. In their minds, respondents cannot claim
that the CRAB and the PMA thoroughly reviewed the HC recommendation and
heard Cadet lCL Cudia's side. As clearly stated in the letter from the Office of the
AFP Adjutant General, "[in] its report dated March 10, 2014, PMA CRAB sustained
the findings and recommendations of the Honor Committee x x x It also resolved
the appeal filed by the subject Cadet." However, the Final Investigation Report of
the CRAB was dated March 23, 2014. While such report states that a report was
submitted to the AFP General Headquarters on March 10, 2014 and that it was
only on March 12, 2014 that it was designated as a Fact-Finding
Board/Investigating Body, it is unusual that the CRAB would do the same things
twice. This raised a valid and well-grounded suspicion that the CRAB never
undertook an in-depth investigation/review the first time it came out with its report,
and the Final Investigation Report was drafted merely as an afterthought when the
lack of written decision was pointed out by petitioners so as to remedy the
apparent lack of due process during the CRAB investigation and review.
Despite the arguments, respondents assure that there was a proper assessment of
the procedural and legal correctness of the guilty verdict against Cadet 1 CL
Cudia. They assert that the higher authorities of the PMA did not merely rely on the
findings of the HC, noting that there was also a separate investigation conducted
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by the HTG from January 25 to February 7, 2014. Likewise, contrary to the
contention of petitioners that the CRAB continued with the review of the case
despite the absence of necessary documents, the CRAB conducted its own review
of the case and even conducted another investigation by constituting the Fact-
Finding Board/Investigating Body. For respondents, petitioners failed to discharge
the burden of proof in showing bad faith on the part of the PMA. In the absence of
evidence to the contrary and considering further that petitioners' allegations are
merely self-serving and baseless, good faith on the part of the PMA' s higher
authorities is presumed and should, therefore, prevail.
We agree with respondents.
The Honor Committee, acting on behalf of the Cadet Corps, has a limited role of
investigating and determining whether or not the alleged offender has actually
violated the Honor Code.181 It is given the responsibility of administering the Honor
Code and, in case of breach, its task is entirely investigative, examining in the first
instance a suspected violation. As a means of encouraging self-discipline, without
ceding to it any authority to make final adjudications, the Academy has assigned it
the function of identifying suspected violators.182 Contrary to petitioners' assertion,
the HC does not have the authority to order the separation of a cadet from the
Academy. The results of its proceedings are purely recommendatory and have no
binding effect. The HC determination is somewhat like an indictment, an allegation,
which, in Cadet 1 CL Cudia's case, the PMA-CRAB investigated de novo.183 In the
U.S., it was even opined that due process safeguards do not actually apply at the
Honor Committee level because it is only a "charging body whose decisions had
no effect other than to initiate de nova proceedings before a Board of Officers."184
Granting, for argument's sake, that the HC is covered by the due process clause
and that irregularities in its proceedings were in fact committed, still, We cannot
rule for petitioners. It is not required that procedural due process be afforded at
every stage of developing disciplinary action. What is required is that an adequate
hearing be held before the final act of dismissing a cadet from the military
academy.185 In the case of Cadet 1 CL Cudia, the OIC of HC, the SJA, the
Commandant of Cadets, and the PMA Superintendent reviewed the HC findings. A
separate investigation was also conducted by the HTG. Then, upon the directive of
the AFP-GHQ to reinvestigate the case, a review was conducted by the CRAB.
Finally, a Fact-Finding Board/Investigating Body composed of the CRAB members
and the PMA senior officers was constituted to conduct a deliberate investigation
of the case. The Board/Body actually held hearings on March 12, 13, 14 and 20,
2014. Instead of commendation, petitioners find it "unusual" that the CRAB would
do the same things twice and suspect that it never undertook an in-depth
investigation/review the first time it came out with its report. Such assertion is mere
conjecture that deserves scant consideration.
As to the dismissal proceedings as sham trial –
According to petitioners, the proceedings before the HC were a sham. The people
behind Cadet ICL Cudia's charge, investigation, and conviction were actually the
ones who had the intent to deceive and who took advantage of the situation. Cadet
1 CL Raguindin, who was a senior HC member and was the second in rank to
Cadet 1 CL Cudia in the Navy cadet 1 CL, was part of the team which conducted
the preliminary investigation. Also, Cadet I CL Mogol, the HC Chairman, previously
charged Cadet 1 CL Cudia with honor violation allegedly for cheating (particularly,
conniving with and tutoring his fellow cadets on a difficult topic by giving solutions
to a retake exam) but the charge was dismissed for lack of merit. Even if he was a
non-voting member, he was in a position of influence and authority. Thus, it would
be a futile exercise for Cadet 1 CL Cudia to resort to the procedure for the removal
of HC members.186
Further, no sufficient prior notice of the scheduled CRAB hearing was given to
Cadet I CL Cudia, his family, or his PAO counsel. During one of her visits to him in
the Holding Center, petitioner-intervenor was advised to convince his son to resign
and immediately leave the PMA. Brig. Gen. Costales, who later became the CRAB
Head, also categorically uttered to Annavee: "Your brother, he lied!" The CRAB
conferences were merely used to formalize his dismissal and the PMA never really
intended to hear his side. For petitioners, these are manifestations of PMA's clear
resolve to dismiss him no matter what.
For their part, respondents contend that the CllR's allegation that Maj. Hindang
acted in obvious bad faith and that he failed to discharge his duty to be a good
father of cadets when he "paved the road to [Cadet 1 CL Cudia's] sham trial by the
Honor Committee" is an unfounded accusation. They note that when Maj. Hindang
was given the DR of Cadet 1 CL Cudia, he revoked the penalty awarded because
of his explanation. However, all revocations of awarded penalties are subject to the
review of the STO. Therefore, it was at the instance of Maj. Leander and the
established procedure followed at the PMA that Maj. Hindang was prompted to
investigate the circumstances surrounding Cadet 1 CL Cudia's tardiness.
Respondents add that bad faith cannot likewise be imputed against Maj. Hindang
by referring to the actions taken by Maj. Jekyll Dulawan, the CTO of Cadets 1 CL
Narciso and Arcangel who also arrived late for their next class. Unlike the other
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cadets, Cadet 1 CL Cudia did not admit his being late and effectively evaded
responsibility by ascribing his tardiness to Dr. Costales.
As to the CHR' s finding that Cadet 1 CL Mogol was likewise "in bad faith and
determined to destroy [Cadet 1 CL] Cudia, for reasons of his own" because the
former previously reported the latter for an honor violation in November 2013,
respondents argue that the bias ascribed against him is groundless as there is
failure to note that Cadet 1 CL Mogol was a non-voting member of the HC. Further,
he cannot be faulted for reporting a possible honor violation since he is the HC
Chairman and nothing less is expected of him. Respondents emphasize that the
representatives of the HC are elected from each company, while the HC Chairman
is elected by secret ballot from the incoming first class representatives. Thus, if
Cadet 1 CL Cu'dia believed that there was bias against him, he should have
resorted to the procedure for the removal of HC members provided for in the
Honor Code Handbook.
Finally, respondents declare that there is no reason or ill-motive on the part of the
PMA to prevent Cadet 1 CL Cudia from graduating because the Academy does not
stand to gain anything from his dismissal. On the contrary, in view of his academic
standing, the separation militates against PMA' s mission to produce outstanding,
honorable, and exceptional cadets.
The Court differs with petitioners.
Partiality, like fraudulent intent, can never be presumed. Absent some showing of
actual bias, petitioners' allegations do not hold water. The mere imputation of ill-
motive without proof is speculative at best. Kolesa teaches us that to sustain the
challenge, specific evidence must be presented to overcome
a presumption of honesty and integrity in those serving as adjudicators; and it must
convince that, under a realistic appraisal of psychological tendencies and human
weaknesses, conferring investigative and adjudicative powers on the same
individual poses such a risk of actual bias or prejudgment that the practice must be
forbidden if the guarantee of due process is to be implemented.187
Although a CTO like Maj. Hindang must decide whether demerits are to be
awarded, he is not an adversary of the cadet but an educator who shares an
identity of interest with the cadet, whom he counsels from time to time as a future
leader.188 When the occasion calls for it, cadets may be questioned as to the
accuracy or completeness of a submitted work. A particular point or issue may be
clarified. In this case, the question asked of Cadet 1 CL Cudia concerning his
being late in class is proper, since there is evidence indicating that a breach of
regulation may have occurred and there is reasonable cause to believe that he
was involved in the breach of regulations.189
For lack of actual proof of bad faith or ill-motive, the Court shall rely on the non-
toleration clause of the Honor Code, i.e., "We do not tolerate those who violate the
Code." Cadets are reminded that they are charged with a tremendous duty far
more superior to their personal feeling or friendship.190 They must learn to help
others by guiding them to accept the truth and do what is right, rather than
tolerating actions against truth and justice.191 Likewise, cadets are presumed to be
characteristically honorable; they cannot overlook or arbitrarily ignore the
dishonorable action of their peers, seniors, or subordinates.192 These are what
Cadet 1 CL Mogol exactly did, although he was later proven to have erred in his
accusation. Note that even the Honor Code and Honor System Handbook
recognizes that interpretation of one's honor is generally subjective. 193
Moreover, assuming, for the sake of argument, that Cadets 1 CL' Raguindin and
Mogol as well as Brig. Gen. Costales have an axe to grind against Cadet 1 CL
Cudia and were bent on causing, no matter what, the latter's downfall, their
nefarious conduct would still be insignificant. This is so since the HC (both the
preliminary and formal investigation), the CRAB, and the Fact-Finding
Board/Investigating Body are collegial bodies. Hence, the claim that the
proceedings/hearings conducted were merely a farce because the three
personalities participated therein is tantamount to implying the existence of a
conspiracy, distrusting the competence, independence, and integrity of the other
members who constituted the majority. Again, in the absence of specifics and
substantial evidence, the Court cannot easily give credence to this baseless
insinuation.
As to the HC executive session/chambering –
Petitioners narrate that there was an irregular administrative hearing in the case of
Cadet 1 CL Cudia because two voting rounds took place. After the result of the
secret balloting, Cadet 1 CL Mogol ordered the voting members to go to a room
without the cadet recorders. Therein, the lone dissenter, Cadet lCL Lagura, was
asked to explain his "not guilty" vote. Pressured to change his vote, he was made
to cast a new one finding Cadet 1 CL Cudia guilty. The original ballot was
discarded and replaced. There was no record of the change in vote from 8-1 to 9-0
that was mentioned in the HC formal report.
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The Affidavit of Commander Junjie B. Tabuada executed on March 6, 2014 was
submitted by petitioners since he purportedly recalled Cadet 1 CL Lagura telling
him that he was pressured to change his "not guilty" vote after the voting members
were "chambered." In the sworn statement, Commander Tabuada said:
1. That after CDT lCL CUDIA [was] convicted for honor violation, I [cannot]
remember exactly the date but sometime in the morning of 23rd or 24th of
January 2014, I was in my office filling up forms for the renewal of my
passport, CDT 1CL LAGURA entered and had business with my staff;
2. When he was about to leave I called him. "Lags, halika muna dito," and
he approached me and I let him sit down on the chair in front of my table. I
told and asked him, "Talagang nadali si Cudia ah ... ano ha ang nangyari?
Mag-Tagalog or mag-Bisaya ka." He replied, "Talagang NOT GUILTY ang
vote ko sa kanya sir", and I asked him, "Oh, bakit naging guilty di ha pag
may isang nag NOT GUILTY, abswelto na? He replied "Chinamber ako sir,
bale pinapa-justify kung bakit NOT GUILTY vote ko, at na-pressure din
ako sir kaya binago ko, sir." So, I told him, "Sayang sya, matalino at
mabait pa naman" and he replied "oo nga sir". After that conversation, I let
him go.194
It is claimed that the HC gravely abused its discretion when it committed voting
manipulation since, under the rules, it is required to have a unanimous nine (9)
votes finding an accused cadet guilty. There is nothing in the procedure that
permits the HC Chairman to order the "chambering" of a member who voted
contrary to the majority and subjects him or her to reconsider in order to reflect a
unanimous vote. Neither is there an order from the Chief of Staff or the President
sanctioning the HC procedure or approving any change therein pursuant to
Sections 30 and 31 of C.A. No. 1. The HC, the CRAB, and the PMA violated their
own rules and principles as embodied in the Honor Code. Being a clear deviation
from the established procedures, the second deliberation should be considered
null and void.
Petitioners further contend that the requirement of unanimous vote involves a
substantive right which cannot be unceremoniously changed without a
corresponding amendment/revision in the Honor Code and Honor System
Handbook. In their view, "chambering" totally defeats the purpose of voting by
secret ballot as it glaringly destroys the very essence and philosophy behind the
provisions of the Honor System, which is to ensure that the voting member is free
to vote what is in his or her heart and mind and that no one can pressure or
persuade another to change his or her vote. They suggest that if one voting
member acquits an accused cadet who is obviously guilty of the offense, the
solution is to remove him or her from the HC through the vote of non-confidence as
provided for in the Honor Code.195 Anent the above arguments, respondents
contend that a distinction must be made between the concepts of the Honor Code
and the Honor System. According to them, the former sets the standard for a
cadet's, minimum ethical and moral behavior and does not change, while the latter
is a set of rules for the conduct of the observance and implementation of the·
Honor Code and may undergo necessary adjustments as may be warranted by the
incumbent members of the HC in order to be more responsive to the moral training
and character development of the cadets. The HC may provide guidelines when
the Honor System can be used to supplement regulations. This being so, the
voting process is continuously subject to change.
Respondents note that, historically, a non-unanimous guilty verdict automatically
acquits a cadet from the charge of Honor violation. The voting members only write
either "guilty" or "not guilty" in the voting sheets without stating their name or their
justification. However, this situation drew criticisms since there were instances
where a reported cadet already admitted his honor violation but was acquitted due
to the lone vote of a sympathetic voting member.
In the case of Cadet 1 CL Cudia, the HC adopted an existing practice that should
the voting result in 7-2 or 8-1 the HC would automatically sanction a jury type of
discussion called "executive session" or "chambering," which is intended to elicit
the explanation and insights of the voting member/s. This prevents the tyranny of
the minority or lone dissenter from prevailing over the manifest proof of guilt. The
assailed voting practice has been adopted and widely accepted by the PMA Siklab
Diwa Class of 2014 since their first year in the Academy. The allegations of
conspiracy and sham trial are, therefore, negated by the fact that such practice
was in place and applied to all cases of honor violations, not solely to the case of
Cadet 1CL Cudia.
It is emphasized by respondents that any decision to change vote rests solely on
the personal conviction of the dissenter/s, without any compulsion from the other
voting members. There can also be no pressuring to change one's vote to speak of
since a vote may only be considered as final when the Presiding Officer has
affixed his signature.
To debunk Commander Tabuada's statements, respondents raise the argument
that the Fact-Finding Board/Investigating Body summoned Cadet 1 CL Lagura for
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inquiry. Aside from his oral testimony made under oath, he submitted to the
Board/Body an affidavit explaining that:
11. Sometime on 23rd or 24th of January 2014, I went to the Department of Naval
Warfare to ask permission if it is possible not to attend the Navy duty for the
reason that I will be attending our baseball game outside the Academy.
12. After I was permitted not to attend my Navy Duty and when I was about to exit
out of the Office, CDR JUNJIE B T ABU ADA PN, our Head Department Naval
Warfare Officer, called my attention. I approached him and he said: "Talagang
nadali si Cudia ah. Ano ba talaga ang nangyari?" At first, I was hesitant to answer
because of the confidentiality of the Honor Committee proceedings. He again said:
"Wag kang mag-alala, atin, atin lang ito, alam ko naman na bawal magsabi." Then
I answered: "Ako yung isang not guilty Sir. Kaya [yung] Presiding Officer nagsabi
na pumunta muna kami sa Chamber. Nung nasa chamber kami, nagsalita [yung]
mga nagvote ng Guilty tapos isa-isa nagsabi kung bakit ang boto nila Guilty. Nung
pakinggan ko, eh naliwanagan ako. Pinalitan ko yung boto ko from Not Guilty to
Guilty Sir." He replied: "Sayang si Cudia ano?" And I said: "Oo nga sir, [s]ayang si
Cudia, mabait pa naman at matalino."196
Cadet 1 CL Lagura restated the above in the Counter-Affidavit executed on March
12, 2014, which he submitted before the CHR wherein he attested to the following:
3. I was chosen to be a voting member of the Honor Committee for Honor
Code violation committed by Cadet Cudia, for "lying". As a voting member,
we are the one who assess or investigate the case whether the reported
Cadet is Guilty for his actions or not.
4. I was the only one who INITIALLY voted "NOT GUILTY" among the nine
(9) voting members of the Honor Committee in the case of Cdt Cudia for
Lying.
5. I initially voted "NOT GUILTY" for the reason that after the proceedings
and before the presiding Officer told the members to vote, I was confused
of the case of Cadet Cudia. I have gathered some facts from the
investigation to make my decision but for me it is not yet enough to give
my verdict of guilty to Cdt Cudia so I decided to vote "NOT GUILTY" with a
reservation in my mind that we will still be discussing our verdicts if we will
arrive at 8-1 or 7-2. Thus, I can still change my vote if I may be
enlightened with the other's justifications.
6. After the votes were collected, the Presiding Officer told us that the vote
is 8 for guilty and 1 for not guilty. By way of practice and as I predicted, we
were told to go inside the anteroom for executive meeting and to discuss
our respective justifications. I have been a member for two (2) years and
the voting committee will always go for executive meeting whenever it will
meet 8-1 or 7-2 votes.
7. I listened to them and they listened to me, then I saw things that
enlightened my confusions that time. I gave a thumbs-up sign and asked
for another sheet of voting paper. I then changed my vote from "NOT
GUILTY" to "GUILTY" and the voting members of the Honor Committee
came up with the final vote of nine (9) votes for guilty and zero (0) votes
for not guilty.
9. Cdt Cudia was called inside the courtroom and told that the verdict was
GUILTY of LYING. After that, all persons inside the courtroom went back
to barracks.
10. Right after I changed to sleeping uniform, I was approached by Cdt
Jocson and Cdt Cudia, inquiring and said: "Bakit ka naman nagpalit ng
boto? ., I answered: "Nasa process yan, may mali talaga sa rason mo."
They also asked who were inside the Chamber and I mentioned only Cdt
Arlegui and Cdt Mogol. That was the last time that Cdt Cudia and Cdt
Jocson talked to me.
11. Sometime on 23rd or 24th of January 2014, I went to the Department
of Naval Warfare to asked (sic) permission if it is possible not to attend the
Navy duty for the reason that I will be attending our baseball game outside
the Academy.
12. After I was permitted not to attend my Navy Duty and when I was
about to exit out of the Office, CDR JUNJIE B TABUADA PN, our Head
Department Naval Warfare Officer, called my attention. I approached him
and he said: "Talagang nadali si Cudia ah. Ano ba talaga ang nangyari?"
At first, I was hesitant to answer because of the confidentiality of the Honor
Committee proceedings. He again said: "Wag kang mag-alala, atin, atin
lang ito, alam ko naman na bawal magsabi. " Then I answered: "Ako yung
isang not guilty Sir. Kaya [yung} Presiding Officer nagsabi na pumunta
muna kami sa Chamher. Nung nasa chamber kami, nagsalita [yung] mga
nagvote ng Guilty tapos isa-isa nagsabi kung bakit ang boto nila Guilty.
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 Nung pakinggan ko, eh naliwanagan aka. Pinalitan ko yung boto ko from
Not Guilty to Guilty Sir. " He replied: "Sayang si Cudia ano?" And I said:
"Oo nga sir, [s]ayang si Cudia, mabait pa naman at matalino. " 197
Still not to be outdone, petitioners argue that the very fact that Cadet 1 CL Lagura,
as the lone dissenter, was made to explain in the presence of other HC members,
who were in disagreement with him, gives a semblance of intimidation, force, or
pressure. For them, the records of the HC proceedings, which were not presented
assuming they actually exist, could have been the best way to ensure that he was
free to express his views, reject the opinion of the majority, and stick to his
decision. Also, it was pointed out that Cadet 1 CL Lagura failed to clearly explain in
his affidavit why he initially found Cadet 1 CL Cudia "not guilty" and what made
him change his mind. His use of general statements like he "was confused of the
case " and "saw things that enlightened my confusions " could hardly suffice to
establish why he changed his vote. Finally, petitioners note the admission of
·Cadet 1 CL Lagura during the CHR investigation that he was the only one who
was given another ballot sheet while in the chamber and that he accomplished it in
the barracks which he only submitted the following day. However, as the CHR
found, the announcement of the 9-0 vote was done immediately after the HC came
out from the chamber and before Cadet 1 CL Lagura submitted his accomplished
ballot sheet.
We rule for respondents.
As to the manner of voting by the HC members, the Honor Code tersely provides:
After a thorough discussion and deliberation, the presiding member of the Board
will call for the members to vote whether the accused is GUILTY or NOT GUILTY.
A unanimous vote (9 votes) of GUILTY decides that a cadet is found guilty of
violating the Honor Code.198
From the above-quoted provision, it readily appears that the HC practice of
conducting "executive session" or "chambering" is not at all prohibited. The HC is
given leeway on the voting procedures in' actual cases taking into account the
exigency of the times. What is important is that, in the end, there must be a
unanimous nine votes in order to hold a cadet guilty of violating the Honor Code.
Granting, for argument's sake, that the HC violated its written procedure, 199 We still
rule that there is nothing inherently wrong with the practice of "chambering"
considering that the presence of intimidation or force cannot automatically be
inferred therefrom. The essence of secret balloting and the freedom to vote based
on what is in the heart and mind of the voting member is not necessarily diluted by
the fact that a second/final voting was conducted. As explained by Cadet 1CL
Mogol before the CRAB:
13. x x x [The] dissenting voter would have to explain his side and insights
regarding the case at hand. The other members, on the other hand, would be
given the chance to explain their votes as well as their insights to the dissenting
voter. The decision to change the vote of the dissenting voter rests solely on his
personal conviction. Thus, if he [or she] opted not to change his/her vote despite
the discussion, his [or her] vote is accorded respect by the Honor Committee. 200
It is elementary that intimidation or force is never presumed. Mere allegation is
definitely not evidence.1âwphi1 It must be substantiated and proved because a
person is presumed to be innocent of a crime or wrong and that official duty has
been regularly performed.201
The oral and written statements of Cadet 1 CL Lagura should settle the issue.
Before the Fact-Finding Board/Investigating Body and the CHR, he consistently
denied that he was pressured by the other voting members of the HC. His
representation must be accepted as it is regardless of whether he has satisfactorily
elaborated his decision to change his vote. Being the one who was "chambered,"
he is more credible to clarify the issue. In case of doubt, We have to rely on the
faith that Cadet 1 CL Lagura observed the Honor Code, which clearly states that
every cadet must be his or her own Final' Authority in honor; that he or she should
not let other cadets dictate on him or her their sense of honor.202 Moreover, the
Code implies that any person can have confidence that a cadet and any graduate
of the PMA will be fair and just in dealing with him; that his actions, words and
ways are sincere and true.203
As to the other alleged "irregularities" committed such as not putting on record the
initial/first voting and Cadet 1CL Lagura's bringing of his ballot sheet to and
accomplishing it in the barracks, the Court shall no longer dwell on the same for
being harmless procedural errors that do not materially affect the validity of the HC
proceedings.
Cadet 1 CL Cudia 's alleged untruthful statements
Petitioners insist that Cadet 1 CL Cudia did not lie. According to them, there is no
clear time reference as to when was the actual dismissal or what was the exact
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time of dismissal - whether it should be the dismissal inside the room or the
dismissal after the section grade was given by Dr. Costales -in the minds of Cadet
1 CL Cudia, Maj. Hindang, and the HC investigators and voting members. They
claim that during long examinations, the time of dismissal was usually five minutes
before the class was set to end and the protocol of dismissing the class 15 minutes
earlier was not observed. When Maj. Hindang stated in accusatory language that
Cadet 1 CL Cudia perverted the truth by stating that OR432 class ended at 1500H,
he did not state what was the true time of dismissal. He did not mention whether
the truth he was relying on was 5 or 15 minutes before the scheduled end of class.
It is also averred that Cadet 1 CL Cudia's only business was to ask Dr. Costales a
query such that his business was already finished as soon as she gave an answer.
However, a new business was initiated by Dr. Costales, which is, Cadet 1 CL
Cudia must stay and wait for the section grade. At that point in time, he was no
longer in control of the circumstances. Petitioners claim that Dr. Costales never
categorically stated that Cadet lCL Cudia was lying. She recognized the confusion.
Her text messages to him clarified his alleged violation. Also, the CHR noted
during its investigation that she could not exactly recall what happened in her class
on November 14, 2013.
Furthermore, petitioners reasoned out that when respondents stated that ENG412
class started at 3:05 p.m., it proves that Cadet 1 CL Cudia was obviously not late.
If, as indicated in his Delinquency Report, he was late two (2) minutes in his 1500-
1600H class in ENG 412, he must have arrived 3:02 p.m. Respondents, however,
claim that the class started at 3:05 p.m. Thus, Cadet 1 CL Cudia was not late.
Relative to his explanation to the delinquency report, petitioners were of the view
that what appears to have caused confusion in the minds of respondents is just a
matter of semantics; that the entire incident was a product of inaccuracy, not lying.
It is malicious for them to insinuate that Cadet 1 CL Cudia purposely used incorrect
language to hide the truth. Citing Merriam Webster's Dictionary, petitioners argue
that "dismiss" means to permit or cause to leave, while "class" refers to a body of
students meeting regularly to study the same subject. According to them, these
two words do not have definite and precise meanings but are generic terms. Other
than the words "class" and "dismiss" used by Cadet 1 CL Cudia, which may
actually be used in their generic sense, there is nothing deceiving about what he
said. Thus, the answer he chose might be wrong or not correct, but it is not false or
not true.
For petitioners, Cadet lCL Cudia's explanations are evidently truthful and with no
intent to deceive or mislead. He did not manipulate any fact and was truthful of his
explanation. His .. statements were clear and unambiguous but were given a
narrow-minded interpretation. Even the Honor Code acknowledges that
"[e]xperience demonstrates that human communication is imperfect at best, and
some actions are often misinterpreted."
Lastly, petitioners contend that Cadet 1 CL Cudia's transcript of records reflects
not only his outstanding academic performance but proves his good conduct
during his four-year stay in the Academy. He has above-average grades in
Conduct, with grades ranging from 96 to 100 in Conduct I to XI. His propensity to
lie is, therefore, far from the truth.
On the other hand, respondents were equally adamant to contend that Cadet 1 CL
Cudia was obviously quibbling, which, in the military parlance, is tantamount to
lying. He fell short in telling a simple truth. He lied by making untruthful statements
in his written explanation. Respondents want Us to consider the following:
First, their OR432 class was not dismissed late. During the formal investigation,
Dr. Costales testified that a class is dismissed as long as the instructor is not there
and the bell has rung. In cases of lesson examinations (LE), cadets are dismissed
from the time they have answered their respective LEs. Here, as Cadet Cudia
stated in his Request for Reconsideration of Meted Punishment, "We had an LE
that day (14 November 2013) in OR432 class. When the first bell rang (1455), I
stood up, reviewed my paper and submitted it to my instructor, Ms. Costales. xxx"
Clearly, at the time Cadet Cudia submitted his papers, he was already considered
dismissed. Thus, he cannot claim that his [OR432] class ended at 3:00 in the
afternoon (1500H) or "a bit late."
Second, Cadet Cudia was in control of the circumstances leading to his tardiness.
After submitting his paper, Cadet Cudia is free to leave and attend his next class.
However, he initiated a conversation with Dr. Costales regarding their grades. He
was not under instruction by Dr. Costales to stay beyond the period of her class.
Furthermore, during the investigation of the Fact-Finding Board/Investigating Body,
Dr. Costales clarified her statements in her written explanation. She explained that
the "instruction to wait" is a response to Cadet Cudia' s request and that it was not
her initiated instruction. Clearly, there was no directive from Dr. Costales for Cadet
Cudia and the other cadets to stay. On the contrary, it was them who wanted to
meet with the instructor. Third, contrary to Cadet Cudia's explanation, his
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subsequent class, ENG412, did not exactly start at 3:00 in the afternoon (1500H).
In the informal review conducted by the HTG to check the findings of the HC,
Professor Berong confirmed that her English class started as scheduled (3:05 in
the afternoon, or 1505H) and not earlier. Cadet 1 CL Barrawed, the acting class
marcher of ENG412 also testified that their class started as scheduled (3 :05 in the
afternoon, or 1505) and not earlier.204
Respondents were unimpressed with the excuse that Cadet 1 CL Cudia had no
intention to mislead or deceive but merely used wrong and unfitting words in his
explanations. For them, considering his academic standing, it is highly improbable
that he used incorrect language to justify his mistake. Respondents' arguments are
tenable.
The issue of whether Cadet 1 CL Cudia committed lying is an issue of fact.
Unfortunately for petitioners, the Court, not being a trier of facts, cannot pass upon
factual matters as it is not duty-bound to analyze and weigh again the evidence
considered in the proceedings below. Moreover, We reiterate the long standing
rule that factual findings of administrative tribunals are ordinarily accorded respect
if not finality by the Court. In this case, as shown in the previous discussions, there
is no evidence that the findings of the investigating and reviewing bodies below are
not supported by evidence or vitiated by fraud, imposition or collusion; that the
procedure which led to the findings is irregular; that palpable errors were
committed; or that a grave abuse of discretion, arbitrariness, or capriciousness is
manifest. With respect to the core issue of whether lying is present in this case, all
investigating and reviewing bodies are in consonance in holding that Cadet 1 CL
Cudia in truth and in fact lied.
For purposes of emphasis though, We shall supplement some points.
As succinctly worded, the Honor Code of the Cadet Corps Armed Forces of the
Philippines (CCAFP) states: "We, the Cadets, do not lie, cheat, steal, nor tolerate
among us those who do. "
The First Tenet of the Honor-Code is "We do not lie. " Cadets violate the Honor
Code by lying if they make an oral or written statement which is contrary to what is
true or use doubtful information with the intent to deceive or mislead.205 It is
expected that every cadet's word is accepted without challenge on its truthfulness;
that it is true without qualification; and that the cadets must answer directly,
completely and truthfully even though the answer may result in punitive action
under the CCPB and CCAFPR.206
To refresh, in his Explanation of Report dated December 8, 2013, Cadet 1 CL
Cudia justified that: "I came directly from OR432 Class. We were dismissed a bit
late by our instructor Sir." Subsequently, in his Request for Reconsideration of
Meted Punishment to Maj. Leander, he reasoned out as follows:
I strongly believe that I am not in control of the circumstances, our 4th period class
ended 1500H and our 5th period class, which is ENG412, started 1500H also.
Immediately after 4t period class, I went to my next class without any intention of
being late Sir.207
In this case, the Court agrees with respondents that Cadet 1 CL Cudia committed
quibbling; hence, he lied in violation of the Honor Code.
Following an Honor Reference Handbook, the term "Quibbling" has been defined
in one U.S. case as follows:
A person can easily create a false impression in the mind of his listener by cleverly
wording what he says, omitting relevant facts, or telling a partial truth. When he
knowingly does so with the intent to deceive or mislead, he is quibbling. Because it
is an intentional deception, quibbling is a form of lying.208
The above definition can be applied in the instant case. Here, instead of directly
and completely telling the cause of his being late in the ENG412 class of Prof.
Berong, Cadet 1 CL Cudia chose to omit relevant facts, thereby, telling a half-truth.
The two elements that must be presented for a cadet to have committed an honor
violation are:
1. The act and/or omission, and
2. The intent pertinent to it.
Intent does not only refer to the intent to violate the Honor Code, but intent to
commit or omit the act itself.209
The basic questions a cadet must always seek to answer unequivocally are:
1. Do I intend to deceive?
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 2. Do I intend to take undue advantage?
If a cadet can answer NO to BOTH questions, he or she is doing the honorable
thing.210
Intent, being a state of mind, is rarely susceptible of direct proof, but must
ordinarily be inferred from the facts, and therefore, can only be proved by
unguarded expressions, conduct and circumstances generally.211 In this case,
Cadet 1 CL Cudia's intent to deceive is manifested from the very act of capitalizing
on the use of the words "dismiss" and "class." The truth of the matter is that the
ordinary usage of these two terms, in the context of an educational institution, does
not correspond to what Cadet 1 CL Cudia is trying to make it appear. In that sense,
the words are not generic and have definite and precise meaning.
By no stretch of the imagination can Cadets 1 CL Cudia, Miranda, Arcangel, and
Narciso already constitute a "class." The Court cannot agree that such term
includes "every transaction and communication a teacher does with her students."
Clearly, it does not take too much intelligence to conclude that Cadet 1 CL Cudia
should have been accurate by pinpointing who were with him when he was late in
the next class. His deceptive explanation is made more obvious when compared
with what Cadets 1 CL Archangel and Narciso wrote in their DR explanation, which
was: "We approached our instructor after our class."212
Further, it is unimportant whether the time of dismissal on November 14, 2013 was
five or fifteen minutes ahead of the scheduled end of class. Worth noting is that
even Dr. Costales, who stood as a witness for Cadet 1 CL Cudia, consistently
admitted before the HC, the Fact-Finding Board/Investigating Body, and the CHR
that he was already dismissed when he passed his LE paper.213 During the
hearing of the Board/Body, she also declared that she merely responded to his
request to see the results of the UE 1 and that she had reservations on the
phrases "under my instruction" and "dismissed a bit late" used in his letter of
explanation to the HC. In addition, Dr. Costales manifested her view before the
CHR that the act of Cadet 1 CL Cudia of inquiring about his grade outside their
classroom after he submitted his LE paper is not part of the class time because the
consultation, being cadet-initiated, is voluntary.214 Assuming, for the sake of
argument, that a new business was initiated by Dr. Costales when Cadet 1 CL
Cudia was asked to stay and wait for the section grade, still, this does not acquit
him. Given such situation, a responsible cadet who is fully aware of the time
constraint has the last say, that is, to politely decline the invitation and immediately
go to the next class. This was not done by Cadet 1 CL Cudia. Thus, it cannot be
said that he already lost control over the circumstances.
It is apparent, therefore, that Cadet 1 CL Cudia cunningly chose words which led
to confusion in the minds of respondents and eventually commenced the HC
inquiry. His case is not just a matter of semantics and a product of plain and simple
inaccuracy. There is manipulation of facts and presentation of untruthful
explanation constitutive of Honor Code violation.
Evidence of prior good conduct cannot clear Cadet 1 CL Cudia .. While his
Transcript of Records (TOR) may reflect not only his outstanding academic
performance but his excellent grade in subjects on Conduct during his four-year
stay in the PMA,215 it does not necessarily follow that he is innocent of the offense
charged. It is enough to say that "evidence that one did or did not do a certain
thing at one time is not admissible to prove that he did or did not do the same or
similar thing at another time."216 While the TOR may be received to prove his
identity or habit as an exceptional PMA student, it does not show his specific
intent, plan, or scheme as cadet accused of committing a specific Honor Code
violation.
Dismissal from the PMA as unjust and cruel punishment
Respondents insist that violation of the Honor Code warrants separation of the
guilty cadet from the cadet corps. Under the Cadet Corps Armed Forces of the
Philippines Regulation (CCAFPR), a violation of the Cadet Honor Code is
considered Grave (Class 1) delinquency which merits a recommendation for a
cadet's dismissal from the PMA Superintendent. The same is likewise clear from
the Honor Code and Honor System Handbook. Cadet 1 CL Cudia is, therefore,
presumed to know that the Honor Code does not accommodate a gradation or
degree of offenses. There is no difference between a little lie and a huge
falsehood. Respondents emphasize that the Honor Code has always been
considered as an absolute yardstick against which cadets have measured
themselves ever since the PMA began and that the Honor Code and System seek
to assure that only those who are able to meet the high standards of integrity and
honor are produced by the PMA. As held in Andrews, it is constitutionally
permissible for the military "to set and enforce uncommonly high standards of
conduct and ethics. " Thus, in violating the Honor Code, Cadet 1 CL Cudia forfeits
his privilege to graduate from the PMA.
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On their part, petitioners concede that if it is proven that a cadet breached the
Honor Code, the offense warrants his or her dismissal since such a policy may be
the only means to maintain and uphold the spirit of integrity in the military. 217 They
maintain though that in Cadet 1 CL Cudia's case there is no need to distinguish
between a "little lie" and a "huge falsehood" since he did not lie at all. Absent any
intent to deceive and to take undue advantage, the penalty imposed on him is
considered as unjust and cruel. Under the circumstances obtaining in this case,
the penalty of dismissal is not commensurate to the fact that he is a graduating
cadet with honors and what he allegedly committed does not amount to an
academic deficiency or an intentional and flagrant violation of the PMA non-
academic rules and regulations. Citing Non, petitioners argue that the penalty
imposed must be proportionate to the offense. Further, lsabelo, Jr. is squarely
applicable to the facts of the case. Cadet 1 CL Cudia was deprived of his right to
education, the only means by which he may have a secure life and future.
Considering Our finding that Cadet 1 CL Cudia in truth and in fact lied and his
acceptance that violation of the Honor Code warrants the ultimate penalty of
dismissal from the PMA, there is actually no more dispute to resolve. Indeed, the
sanction is clearly set forth and Cadet 1 CL Cudia, by contract, risked this when he
entered the Academy.218 We adopt the ruling in Andrews219 wherein it was held
that, while the penalty is severe, it is nevertheless reasonable and not arbitrary,
and, therefore, not in violation of due process. It quoted the disposition of the
district court, thus:
The fact that a cadet will be separated from the Academy upon a finding that he
has violated the Honor Code is known to all cadets even prior to the beginning of
their careers there. The finding of a Code violation by hypothesis includes a finding
of scienter on the part of the offender. While separation is admittedly a drastic and
tragic consequence of a cadet's transgression, it is not an unconstitutionally
arbitrary one, but rather a reasonable albeit severe method of preventing men who
have suffered ethical lapses from becoming career officers. That a policy of
admonitions or lesser penalties for single violations might be more compassionate
--or even more effective in achieving the intended result --is quite immaterial to the
question of whether the harsher penalty violates due process.220
Nature of the CHR Findings
Petitioners contend that the PMA turned a blind eye on the CHR's
recommendations. The CHR, they note, is a constitutional body mandated by the
1987 Constitution to investigate all forms of human rights violations involving civil
and political rights, and to conduct investigative monitoring of economic, social,
and cultural rights, particularly of vulnerable sectors of society. Further, it was
contended that the results of CHR's investigation and recommendations are so
persuasive that this Court, on several occasions like in the cases of Cruz v. Sec. of
Environment & Natural Resources221 and Ang Ladlad LGBT Party v. Commission
on Elections,222 gave its findings serious consideration. It is not, therefore, too late
for the Court to hear what an independent and unbiased fact-finding body has to
say on the case.
In opposition, respondents assert that Simon, Jr. v. Commission on Human
Rights223 ruled that the CHR is merely a recommendatory body that is not
empowered to arrive at a conclusive determination of any controversy.
We are in accord with respondents.
The findings of fact and the conclusions of law of the CHR are merely
recommendatory and, therefore, not binding to this Court. The reason is that the
CHR's constitutional mandate extends only to the investigation of all forms of
human rights violations involving civil and political rights. 224 As held in Cariño v.
Commission on Human Rights225and a number of subsequent cases,226 the CHR is
only a fact-finding body, not a court of justice or a quasi-judicial agency. It is not
empowered to adjudicate claims on the merits or settle actual case or
controversies. The power to investigate is not the same as adjudication:
The most that may be conceded to the Commission in the way of adjudicative
power is that it may investigate, i.e., receive evidence and make findings of fact as
regards claimed human rights violations involving civil and political rights. But fact-
finding is not adjudication, and cannot be likened to the judicial function of a court
of justice, or even a quasi-judicial agency or official. The function of receiving
evidence and ascertaining therefrom the facts of a controversy is not a judicial
function, properly speaking. To be considered such, the faculty of receiving
evidence and making factual conclusions in a controversy must be accompanied
by the authority of applying the law to those factual conclusions to the end that the
controversy may be decided or determined authoritatively, finally and definitively,
subject to such appeals or modes of review as may be provided by law. This
function, to repeat, the Commission does not have.
xxxx
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[i]t cannot try and decide cases (or hear and determine causes) as courts of
justice, or even quasi-judicial bodies do. To investigate is not to adjudicate or
adjudge. Whether in the popular or the technical sense, these terms have well
understood and quite distinct meanings.
"Investigate, "commonly understood, means to examine, explore, inquire or delve
or probe into, research on, study. The dictionary definition of "investigate" is "to
observe or study closely: inquire into systematically: "to search or inquire into: x x x
to subject to an official probe x x x: to conduct an official inquiry;" The purpose of
investigation, of course, is to discover, to find out, to learn, obtain information.
Nowhere included or intimated is the notion of settling, deciding or resolving a
controversy involved in the facts inquired into by application of the law to the facts
established by the inquiry.
The legal meaning of "investigate" is essentially the same: "(t)o follow up step by
step by patient inquiry or observation. To trace or track; to search into; to examine
and inquire into with care and accuracy; to find out by careful inquisition;
examination; the taking of evidence; a legal inquiry;" "to inquire; to make an
investigation," "investigation" being in turn described as "(a)n administrative
function, the exercise of which ordinarily does not require a hearing. 2 Am J2d
Adm L Sec. 257; xx x an inquiry, judicial or otherwise, for the discovery and
collection of facts concerning a certain matter or matters."
"Adjudicate," commonly or popularly understood, means to adjudge, arbitrate,
judge, decide, determine, resolve, rule on, settle. The dictionary defines the term
as "to settle finally (the rights and duties of the parties to a court case) on the
merits of issues raised: xx to pass judgment on: settle judicially: x x x act as
judge." And "adjudge" means "to decide or rule upon as a judge or with judicial or
quasi-judicial powers: xx to award or grant judicially in a case of controversy x x x."
In the legal sense, "adjudicate" means: "To settle in the exercise of judicial
authority.1âwphi1 To determine finally. Synonymous with adjudge in its strictest
sense;" and "adjudge" means: "To pass on judicially, to decide, settle or decree, or
to sentence or condemn. xx Implies a judicial determination of a fact, and the entry
of a judgment. "226
All told, petitioners are not entitled to moral and exemplary damages in accordance
with Articles 19, 2217, 2219 and 2229 of the Civil Code. The dismissal of Cadet 1
CL Cudia from the PMA did not effectively deprive him of a future. Cliche though it
may sound, being a PMA graduate is not the "be-all and end-all" of his existence.
A cadet separated from the PMA may still continue to pursue military or civilian
career elsewhere without suffering the stigma attached to his or her dismissal. For
one, as suggested by respondents, DND-AFP Circular No. 13, dated July 15,
1991, on the enlistment and reenlistment in the APP Regular Force, provides
under Section 14 (b) thereof that priority shall be given to, among others, the ex-
PMA or PAFFFS cadets.227 If the positions open does not appeal to his interest for
being way below the rank he could have achieved as a PMA graduate, Cadet 1 CL
Cudia could still practice other equally noble profession or calling that is best
suited to his credentials, competence, and potential. Definitely, nobody can deprive
him of that choice.
WHEREFORE, the Petition is DENIED. The dismissal of Cadet First Class Aldrin
Jeff P. Cudia from the Philippine Military Academy is hereby AFFIRMED. No costs.
SO ORDERED.
G.R. No. 211833, April 07, 2015
FERDINAND R. VILLANUEVA, PRESIDING JUDGE, MCTC, COMPOSTELA-
NEW BATAAN, COMPOSTELA VALLEY PROVINCE, Petitioner, v. JUDICIAL
AND BAR COUNCIL, Respondent.
DECISION
REYES, J.:
Presiding Judge Ferdinand R. Villanueva (petitioner) directly came to this
Court via a Petition for Prohibition, Mandamus, and Certiorari, and Declaratory
Relief1 under Rules 65 and 63 of the Rules of Court, respectively, with prayer for
the issuance of a temporary restraining order and/or writ of preliminary injunction,
to assail the policy of the Judicial and Bar Council (JBC), requiring five years of
service as judges of first-level courts before they can qualify as applicant to
second-level courts, on the ground that it is unconstitutional, and was issued with
grave abuse of discretion.chanRoblesvirtualLawlibrary
The Facts
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The petitioner was appointed on September 18, 2012 as the Presiding Judge of
the Municipal Circuit Trial Court, Compostela-New Bataan, Poblacion, Compostela
Valley Province, Region XI, which is a first-level court. On September 27, 2013, he
applied for the vacant position of Presiding Judge in the following Regional Trial
Courts (RTCs): Branch 31, Tagum City; Branch 13, Davao City; and Branch 6,
Prosperidad, Agusan Del Sur.
In a letter2 dated December 18, 2013, JBC's Office of Recruitment, Selection and
Nomination, informed the petitioner that he was not included in the list of
candidates for the said stations. On the same date, the petitioner sent a letter,
through electronic mail, seeking reconsideration of his non-inclusion in the list of
considered applicants and protesting the inclusion of applicants who did not pass
the prejudicature examination.
The petitioner was informed by the JBC Executive Officer, through a letter3 dated
February 3, 2014, that his protest and reconsideration was duly noted by the
JBC en banc. However, its decision not to include his name in the list of applicants
was upheld due to the JBC's long-standing policy of opening the chance for
promotion to second-level courts to, among others, incumbent judges who have
served in their current position for at least five years, and since the petitioner has
been a judge only for more than a year, he was excluded from the list. This caused
the petitioner to take recourse to this Court.
In his petition, he argued that: (1) the Constitution already prescribed the
qualifications of an RTC judge, and the JBC could add no more; (2) the JBC's five-
year requirement violates the equal protection and due process clauses of the
Constitution; and (3) the JBC's five-year requirement violates the constitutional
provision on Social Justice and Human Rights for Equal Opportunity of
Employment. The petitioner also asserted that the requirement of the Prejudicature
Program mandated by Section 104 of Republic Act (R.A.) No. 85575 should not be
merely directory and should be fully implemented. He further alleged that he has
all the qualifications for the position prescribed by the Constitution and by
Congress, since he has already complied with the requirement of 10 years of
practice of law.
In compliance with the Court's Resolution6 dated April 22, 2014, the JBC7 and the
Office of the Solicitor General (OSG)8separately submitted their Comments.
Summing up the arguments of the JBC and the OSG, they essentially stated that
the petition is procedurally infirm and that the assailed policy does not violate the
equal protection and due process clauses. They posited that: (1) the writ
of certiorari and prohibition cannot issue to prevent the JBC from performing its
principal function under the Constitution to recommend appointees to the Judiciary
because the JBC is not a tribunal exercising judicial or quasi-judicial function; (2)
the remedy of mandamus and declaratory relief will not lie because the petitioner
has no clear legal right that needs to be protected; (3) the equal protection clause
is not violated because the classification of lower court judges who have served at
least five years and those who have served less than five years is valid as it is
performance and experience based; and (4) there is no violation of due process as
the policy is merely internal in nature.chanRoblesvirtualLawlibrary
The Issue
The crux of this petition is whether or not the policy of JBC requiring five years of
service as judges of first-level courts before they can qualify as applicant to
second-level courts is constitutional.
Ruling of the Court
Procedural Issues:
Before resolving the substantive issues, the Court considers it necessary to first
determine whether or not the action for certiorari, prohibition and mandamus, and
declaratory relief commenced by the petitioner was proper.
One. The remedies of certiorari and prohibition are tenable. "The present Rules of
Court uses two special civil actions for determining and correcting grave abuse of
discretion amounting to lack or excess of jurisdiction. These are the special civil
actions for certiorari and prohibition, and both are governed by Rule 65."9 As
discussed in the case of Maria Carolina P. Araullo, etc., et al. v. Benigno Simeon
C. Aquino III, etc., et al.,10 this Court explained that:chanroblesvirtuallawlibrary
With respect to the Court, however, the remedies of certiorari and prohibition are
necessarily broader in scope and reach, and the writ of certiorari or prohibition may
be issued to correct errors of jurisdiction committed not only by a tribunal,
corporation, board or officer exercising judicial, quasi-judicial or ministerial
functions but also to set right, undo and restrain any act of grave abuse of
discretion amounting to lack or excess of jurisdiction by any branch or
instrumentality of the Government, even if the latter does not exercise judicial,
quasi-judicial or ministerial functions. This application is expressly authorized by
the text of the second paragraph of Section 1, supra.
Thus, petitions for certiorari and prohibition are appropriate remedies to raise
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constitutional issues and to review and/or prohibit or nullify the acts of legislative
and executive officials.11 (Citation omitted)
In this case, it is clear that the JBC does not fall within the scope of a tribunal,
board, or officer exercising judicial or quasi-judicial functions. In the process of
selecting and screening applicants, the JBC neither acted in any judicial or quasi-
judicial capacity nor assumed unto itself any performance of judicial or quasi-
judicial prerogative. However, since the formulation of guidelines and criteria,
including the policy that the petitioner now assails, is necessary and incidental to
the exercise of the JBC's constitutional mandate, a determination must be made
on whether the JBC has acted with grave abuse of discretion amounting to lack or
excess of jurisdiction in issuing and enforcing the said policy.
Besides, the Court can appropriately take cognizance of this case by virtue of the
Court's power of supervision over the JBC. Jurisprudence provides that the power
of supervision is the power of oversight, or the authority to see that subordinate
officers perform their duties. It ensures that the laws and the rules governing the
conduct of a government entity are observed and complied with. Supervising
officials see to it that rules are followed, but they themselves do not lay down such
rules, nor do they have the discretion to modify or replace them. If the rules are not
observed, they may order the work done or redone, but only to conform to such
rules. They may not prescribe their own manner of execution of the act. They have
no discretion on this matter except to see to it that the rules are followed.12
Following this definition, the supervisory authority of the Court over the JBC is to
see to it that the JBC complies with its own rules and procedures. Thus, when the
policies of the JBC are being attacked, then the Court, through its supervisory
authority over the JBC, has the duty to inquire about the matter and ensure that
the JBC complies with its own rules.
Two. The remedy of mandamus cannot be availed of by the petitioner in assailing
JBC's policy. The petitioner insisted that mandamus is proper because his right
was violated when he was not included in the list of candidates for the RTC courts
he applied for. He said that his non-inclusion in the list of candidates for these
stations has caused him direct injury.
It is essential to the issuance of a writ of mandamus that the applicant should have
a clear legal right to the thing demanded and it must be the imperative duty of the
respondent to perform the act required.13The petitioner bears the burden to show
that there is such a clear legal right to the performance of the act, and a
corresponding compelling duty on the part of the respondent to perform the act.
The remedy of mandamus, as an extraordinary writ, lies only to compel an officer
to perform a ministerial duty, not a discretionary one.14 Clearly, the use of
discretion and the performance of a ministerial act are mutually exclusive.
The writ of mandamus does not issue to control or review the exercise of discretion
or to compel a course of conduct, which, it quickly seems to us, was what the
petitioner would have the JBC do in his favor. The function of the JBC to select
and recommend nominees for vacant judicial positions is discretionary, not
ministerial. Moreso, the petitioner cannot claim any legal right to be included in the
list of nominees for judicial vacancies. Possession of the constitutional and
statutory qualifications for appointment to the judiciary may not be used to legally
demand that one's name be included in the list of candidates for a judicial vacancy.
One's inclusion in the list of the candidates depends on the discretion of the JBC,
thus:chanroblesvirtuallawlibrary
The fact that an individual possesses the constitutional and statutory qualifications
for appointment to the Judiciary does not create an entitlement or expectation that
his or her name be included in the list of candidates for a judicial vacancy. By
submitting an application or accepting a recommendation, one submits to the
authority of the JBC to subject the former to the search, screening, and selection
process, and to use its discretion in deciding whether or not one should be
included in the list. Indeed, assuming that if one has the legal right to be included
in the list of candidates simply because he or she possesses the constitutional and
statutory qualifications, then the application process would then be reduced to a
mere mechanical function of the JBC; and the search, screening, and selection
process would not only be unnecessary, but also improper. However, this is clearly
not the constitutional intent. One's inclusion in the list of candidates is subject
to the discretion of the JBC over the selection of nominees for a particular
judicial post. Such candidate's inclusion is not, therefore, a legally demandable
right, but simply a privilege the conferment of which is subject to the JBC's sound
discretion.
Moreover, petitioner is essentially seeking a promotional appointment, that is, a
promotion from a first-level court to a second level court. There is no law,
however, that grants him the right to a promotion to second-level
courts.15 (Emphasis in the original)
Clearly, to be included as an applicant to second-level judge is not properly
compellable by mandamus inasmuch as it involves the exercise of sound
discretion by the JBC.
Three. The petition for declaratory relief is improper. "An action for declaratory
relief should be filed by a person interested under a deed, a will, a contract or other
written instrument, and whose rights are affected by a statute, an executive order,
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a regulation or an ordinance. The relief sought under this remedy includes the
interpretation and determination of the validity of the written instrument and the
judicial declaration of the parties' rights or duties thereunder."16 "[T]he purpose of
the action is to secure an authoritative statement of the rights and obligations of
the parties under a statute, deed, contract, etc., for their guidance in its
enforcement or compliance and not to settle issues arising from its alleged
breach."17
In this case, the petition for declaratory relief did not involve an unsound policy.
Rather, the petition specifically sought a judicial declaration that the petitioner has
the right to be included in the list of applicants although he failed to meet JBC's
five-year requirement policy. Again, the Court reiterates that no person possesses
a legal right under the Constitution to be included in the list of nominees for vacant
judicial positions. The opportunity of appointment to judicial office is a mere
privilege, and not a judicially enforceable right that may be properly claimed by any
person. The inclusion in the list of candidates, which is one of the incidents of such
appointment, is not a right either. Thus, the petitioner cannot claim any right that
could have been affected by the assailed policy.
Furthermore, the instant petition must necessarily fail because this Court does not
have original jurisdiction over a petition for declaratory relief even if only questions
of law are involved.18 The special civil action of declaratory relief falls under the
exclusive jurisdiction of the appropriate RTC pursuant to Section 1919 of Batas
Pambansa Blg. 129, as amended by R.A.No. 7691.20
Therefore, by virtue of the Court's supervisory duty over the JBC and in the
exercise of its expanded judicial power, the Court assumes jurisdiction over the
present petition. But in any event, even if the Court will set aside procedural
infirmities, the instant petition should still be
dismissed.chanRoblesvirtualLawlibrary
Substantive Issues
As an offspring of the 1987 Constitution, the JBC is mandated to recommend
appointees to the judiciary and only those nominated by the JBC in a list officially
transmitted to the President may be appointed by the latter as justice or judge in
the judiciary. Thus, the JBC is burdened with a great responsibility that is imbued
with public interest as it determines the men and women who will sit on the judicial
bench. While the 1987 Constitution has provided the qualifications of members of
the judiciary, this does not preclude the JBC from having its own set of rules and
procedures and providing policies to effectively ensure its mandate.
The functions of searching, screening, and selecting are necessary and incidental
to the JBC's principal function of choosing and recommending nominees for
vacancies in the judiciary for appointment by the President. However, the
Constitution did not lay down in precise terms the process that the JBC shall follow
in determining applicants' qualifications. In carrying out its main function, the JBC
has the authority to set the standards/criteria in choosing its nominees for every
vacancy in the judiciary, subject only to the minimum qualifications required by the
Constitution and law for every position. The search for these long held qualities
necessarily requires a degree of flexibility in order to determine who is most fit
among the applicants. Thus, the JBC has sufficient but not unbridled license to act
in performing its duties.
JBC's ultimate goal is to recommend nominees and not simply to fill up judicial
vacancies in order to promote an effective and efficient administration of justice.
Given this pragmatic situation, the JBC had to establish a set of uniform criteria in
order to ascertain whether an applicant meets the minimum constitutional
qualifications and possesses the qualities expected of him and his office. Thus, the
adoption of the five-year requirement policy applied by JBC to the petitioner's case
is necessary and incidental to the function conferred by the Constitution to the
JBC.
Equal Protection
There is no question that JBC employs standards to have a rational basis to
screen applicants who cannot be all accommodated and appointed to a vacancy in
the judiciary, to determine who is best qualified among the applicants, and not to
discriminate against any particular individual or class.
The equal protection clause of the Constitution does not require the universal
application of the laws to all persons or things without distinction; what it requires is
simply equality among equals as determined according to a valid classification.
Hence, the Court has affirmed that if a law neither burdens a fundamental right nor
targets a suspect class, the classification stands as long as it bears a rational
relationship to some legitimate government end. 21ChanRoblesVirtualawlibrary
"The equal protection clause, therefore, does not preclude classification of
individuals who may be accorded different treatment under the law as long as the
classification is reasonable and not arbitrary."22 "The mere fact that the legislative
classification may result in actual inequality is not violative of the right to equal
protection, for every classification of persons or things for regulation by law
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produces inequality in some degree, but the law is not thereby rendered invalid." 23
That is the situation here. In issuing the assailed policy, the JBC merely exercised
its discretion in accordance with the constitutional requirement and its rules that a
member of the Judiciary must be of proven competence, integrity, probity and
independence.24"To ensure the fulfillment of these standards in every member of
the Judiciary, the JBC has been tasked to screen aspiring judges and justices,
among others, making certain that the nominees submitted to the President are all
qualified and suitably best for appointment. In this way, the appointing process
itself is shielded from the possibility of extending judicial appointment to the
undeserving and mediocre and, more importantly, to the ineligible or
disqualified."25
Consideration of experience by JBC as one factor in choosing recommended
appointees does not constitute a violation of the equal protection clause. The JBC
does not discriminate when it employs number of years of service to screen and
differentiate applicants from the competition. The number of years of service
provides a relevant basis to determine proven competence which may be
measured by experience, among other factors. The difference in treatment
between lower court judges who have served at least five years and those who
have served less than five years, on the other hand, was rationalized by JBC as
follows:chanroblesvirtuallawlibrary
Formulating policies which streamline the selection process falls squarely under
the purview of the JBC. No other constitutional body is bestowed with the mandate
and competency to set criteria for applicants that refer to the more general
categories of probity, integrity and independence.
The assailed criterion or consideration for promotion to a second-level court, which
is five years experience as judge of a first-level court, is a direct adherence to the
qualities prescribed by the Constitution. Placing a premium on many years of
judicial experience, the JBC is merely applying one of the stringent constitutional
standards requiring that a member of the judiciary be of "proven competence." In
determining competence, the JBC considers, among other
qualifications, experience and performance.
Based on the JBC's collective judgment, those who have been judges of first-level
courts for five (5) years are better qualified for promotion to second-level courts. It
deems length of experience as a judge as indicative of conversance with the law
and court procedure. Five years is considered as a sufficient span of time for one
to acquire professional skills for the next level court, declog the dockets, put in
place improved procedures and an efficient case management system, adjust to
the work environment, and gain extensive experience in the judicial process.
A five-year stint in the Judiciary can also provide evidence of the integrity,
probity, and independence of judges seeking promotion. To merit JBC's
nomination for their promotion, they must have had a "record of, and reputation for,
honesty, integrity, incorruptibility, irreproachable conduct, and fidelity to sound
moral and ethical standards." Likewise, their decisions must be reflective of the
soundness of their judgment, courage, rectitude, cold neutrality and strength of
character.
Hence, for the purpose of determining whether judges are worthy of promotion to
the next level court, it would be premature or difficult to assess their merit if they
have had less than one year of service on the bench.26 (Citations omitted and
emphasis in the original)
At any rate, five years of service as a lower court judge is not the only factor that
determines the selection of candidates for RTC judge to be appointed by the
President. Persons with this qualification are neither automatically selected nor do
they automatically become nominees. The applicants are chosen based on an
array of factors and are evaluated based on their individual merits. Thus, it cannot
be said that the questioned policy was arbitrary, capricious, or made without any
basis.
Clearly, the classification created by the challenged policy satisfies the rational
basis test. The foregoing shows that substantial distinctions do exist between
lower court judges with five year experience and those with less than five years of
experience, like the petitioner, and the classification enshrined in the assailed
policy is reasonable and relevant to its legitimate purpose. The Court, thus, rules
that the questioned policy does not infringe on the equal protection clause as it is
based on reasonable classification intended to gauge the proven competence of
the applicants. Therefore, the said policy is valid and constitutional.
Due Process
The petitioner averred that the assailed policy violates procedural due process for
lack of publication and non-submission to the University of the Philippines Law
Center Office of the National Administrative Register (ONAR). The petitioner said
that the assailed policy will affect all applying judges, thus, the said policy should
have been published.
Contrary to the petitioner's contention, the assailed JBC policy need not be filed in
the ONAR because the publication requirement in the ONAR is confined to
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issuances of administrative agencies under the Executive branch of the
government.27 Since the JBC is a body under the supervision of the Supreme
Court,28 it is not covered by the publication requirements of the Administrative
Code.
Nevertheless, the assailed JBC policy requiring five years of service as judges of
first-level courts before they can qualify as applicants to second-level courts should
have been published. As a general rule, publication is indispensable in order that
all statutes, including administrative rules that are intended to enforce or
implement existing laws, attain binding force and effect. There are, however,
several exceptions to the requirement of publication, such as interpretative
regulations and those merely internal in nature, which regulate only the personnel
of the administrative agency and not the public. Neither is publication required of
the so-called letters of instructions issued by administrative superiors concerning
the rules or guidelines to be followed by their subordinates in the performance of
their duties.29
Here, the assailed JBC policy does not fall within the administrative rules and
regulations exempted from the publication requirement. The assailed policy
involves a qualification standard by which the JBC shall determine proven
competence of an applicant. It is not an internal regulation, because if it were, it
would regulate and affect only the members of the JBC and their staff. Notably, the
selection process involves a call to lawyers who meet the qualifications in the
Constitution and are willing to serve in the Judiciary to apply to these vacant
positions. Thus, it is but a natural consequence thereof that potential applicants be
informed of the requirements to the judicial positions, so that they would be able to
prepare for and comply with them.
The Court also noted the fact that in JBC-009, otherwise known as the Rules of the
Judicial and Bar Council, the JBC had put its criteria in writing and listed the
guidelines in determining competence, independence, integrity and probity.
Section 1, Paragraph 1 of Rule 9 expressly provides that applicants for the Court
of Appeals and the Sandiganbayan, should, as a general rule, have at least five
years of experience as an RTC judge, thus:chanroblesvirtuallawlibrary
RULE 9 - SPECIAL GUIDELINES FOR NOMINATION TO A VACANCY IN THE
COURT OF APPEALS AND SANDIGANBAYAN
Section 1. Additional criteria for nomination to the Court of Appeals and the
Sandiganbayan. - In addition to the foregoing guidelines the Council should
consider the following in evaluating the merits of applicants for a vacancy in the
Court of Appeals and Sandiganbayan:
1. As a general rule, he must have at least five years of experience as a judge
of Regional Trial Court, except when he has in his favor outstanding credentials,
as evidenced by, inter alia, impressive scholastic or educational record and
performance in the Bar examinations, excellent reputation for honesty, integrity,
probity and independence of mind; at least very satisfactory performance rating for
three (3) years preceding the filing of his application for nomination; and excellent
potentials for appellate judgeship.
x x x x (Emphasis ours)
The express declaration of these guidelines in JBC-009, which have been duly
published on the website of the JBC and in a newspaper of general circulation
suggests that the JBC is aware that these are not mere internal rules, but are rules
implementing the Constitution that should be published. Thus, if the JBC were so-
minded to add special guidelines for determining competence of applicants for
RTC judges, then it could and should have amended its rules and published the
same. This, the JBC did not do as JBC-009 and its amendatory rule do not have
special guidelines for applicants to the RTC.
Moreover, jurisprudence has held that rules implementing a statute should be
published. Thus, by analogy, publication is also required for the five-year
requirement because it seeks to implement a constitutional provision requiring
proven competence from members of the judiciary.
Nonetheless, the JBC's failure to publish the assailed policy has not prejudiced the
petitioner's private interest. At the risk of being repetitive, the petitioner has no
legal right to be included in the list of nominees for judicial vacancies since the
possession of the constitutional and statutory qualifications for appointment to the
Judiciary may not be used to legally demand that one's name be included in the
list of candidates for a judicial vacancy. One's inclusion in the shortlist is strictly
within the discretion of the JBC.30
As to the issue that the JBC failed or refused to implement the completion of the
prejudicature program as a requirement for appointment or promotion in the
judiciary under R.A. No. 8557, this ground of the petition, being unsubstantiated,
was unfounded. Clearly, it cannot be said that JBC unlawfully neglects the
performance of a duty enjoined by law.
Finally, the petitioner argued but failed to establish that the assailed policy violates
the constitutional provision under social justice and human rights for equal
opportunity of employment. The OSG explained:chanroblesvirtuallawlibrary
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[T]he questioned policy does not violate equality of employment opportunities. The
constitutional provision does not call for appointment to the Judiciary of all who
might, for any number of reasons, wish to apply. As with all professions, it is
regulated by the State. The office of a judge is no ordinary office. It is imbued with
public interest and is central in the administration of justice x x x. Applicants who
meet the constitutional and legal qualifications must vie and withstand the
competition and rigorous screening and selection process. They must submit
themselves to the selection criteria, processes and discretion of respondent JBC,
which has the constitutional mandate of screening and selecting candidates whose
names will be in the list to be submitted to the President. So long as a fair
opportunity is available for all applicants who are evaluated on the basis of their
individual merits and abilities, the questioned policy cannot be struck down as
unconstitutional.31 (Citations omitted)
From the foregoing, it is apparent that the petitioner has not established a clear
legal right to justify the issuance of a preliminary injunction. The petitioner has
merely filed an application with the JBC for the position of RTC judge, and he has
no clear legal right to be nominated for that office nor to be selected and included
in the list to be submitted to the President which is subject to the discretion of the
JBC. The JBC has the power to determine who shall be recommended to the
judicial post. To be included in the list of applicants is a privilege as one can only
be chosen under existing criteria imposed by the JBC itself. As such, prospective
applicants, including the petitioner, cannot claim any demandable right to take part
in it if they fail to meet these criteria. Hence, in the absence of a clear legal right,
the issuance of an injunctive writ is not justified.
As the constitutional body granted with the power of searching for, screening, and
selecting applicants relative to recommending appointees to the Judiciary, the JBC
has the authority to determine how best to perform such constitutional mandate.
Pursuant to this authority, the JBC issues various policies setting forth the
guidelines to be observed in the evaluation of applicants, and formulates rules and
guidelines in order to ensure that the rules are updated to respond to existing
circumstances. Its discretion is freed from legislative, executive or judicial
intervention to ensure that the JBC is shielded from any outside pressure and
improper influence. Limiting qualified applicants in this case to those judges with
five years of experience was an exercise of discretion by the JBC. The potential
applicants, however, should have been informed of the requirements to the judicial
positions, so that they could properly prepare for and comply with them. Hence,
unless there are good and compelling reasons to do so, the Court will refrain from
interfering with the exercise of JBC's powers, and will respect the initiative and
independence inherent in the latter.cralawred
WHEREFORE, premises considered, the petition is DISMISSED. The Court,
however, DIRECTS that the Judicial and Bar Council comply with the publication
requirement of (1) the assailed policy requiring five years of experience as judges
of first-level courts before they can qualify as applicant to the Regional Trial Court,
and (2) other special guidelines that the Judicial and Bar Council is or will be
implementing.
SO ORDERED.chanroblesvirtuallawlibrary
QUO WARRANTO
G.R. No. 237428, May 11, 2018
REPUBLIC OF THE PHILIPPINES, REPRESENTED BY SOLICITOR GENERAL
JOSE C. CALIDA, Petitioner, v. MARIA LOURDES P. A. SERENO, Respondent.
DECISION
TIJAM, J.:
Whoever walks in integrity and with moral character walks securely, but he
who takes crooked way will be discovered and punished.
- The Holy Bible, Proverbs 10:9 (AMP)
Integrity has, at all times, been stressed to be one of the required qualifications of
judge. It is not new concept in the vocation of administering and dispensing justice.
In the early 1600's, Francis Bacon, philosopher, statesman, and jurist, in his
"Essay LVI: Of Judicature" said "[a]bove all things, integrity is the Judge's portion
and proper virtue." Neither is integrity complex concept necessitating esoteric
philosophical disquisitions to be understood. Simply, it is qualification of being
honest, truthful, and having steadfast adherence to moral and ethical
principles.1 Integrity connotes being consistent doing the right thing in accordance
with the law and ethical standards everytime. Hence, every judicial officer in any
society is required to comply, not only with the laws and legislations, but with
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codes and canons of conduct and ethical standards as well, without derogation. As
Thomas Jefferson remarked, "it is of great importance to set resolution, never not
to be shaken, never to tell an untruth. There is no vice so mean, so pitiful, so
contemptible and he who permits himself to tell lie once, finds it much easier to do
it second and third time, till at length it becomes habitual, he tells lies without
attending to it, and truths without the world's believing him. This falsehood of the
tongue leads to that of the heart and in time depraves all its good dispositions."
Mental dishonesty and moral mischief breed all that integrity is not.
In our jurisdiction, one cannot be qualified to be member of the Judiciary, lacking
such mandatory requirement of "proven integrity". Inevitably, an appointee to the
position of Chief Justice of the Supreme Court must be the exemplar of honesty,
probity and integrity. The purpose of this requirement is self-evident as the Chief
Justice heads the Judiciary and adjudicates cases as member of the Court that
"has the last word on what the law is."2 Together with other Justices, the Chief
Justice also disciplines members of the Bar for misconduct. The significance of
probity and integrity as requirement for appointment to the Judiciary is
underscored by the fact that such qualifications are not explicitly required of the
President, the Vice-President or the Members of Congress under the Constitution.
The Constitution, thus, demands in no uncertain terms that the Chief Justice be the
embodiment of moral and ethical principles. He or she must be of unquestionable
character, possessed of moral authority to demand obedience to the law and to
impose rule of conduct. Indeed, one who exacts compliance with the law and
ethical standards should be their foremost adherent.
No one is above the law and the Constitution, not even Chief Justice who took an
oath to protect and defend the Constitution and obey the laws of the land. The
Court in Francisco, Jr. v. The House of Representatives,3 says it tritely "the Chief
Justice is not above the law and neither is any other member of this Court." 4 All
public officers whether in the Executive, Legislative or Judicial departments are
bound to follow the law. If public officer violates the law, he or she shall suffer
punishment, sanctions and adverse consequences. The obligatory force of the law
is necessary because once we allow exceptions, concessions, waiver, suspension
or non application to those who do not want to follow the law, nobody else will
obey the law.
In this unprecedented case for quo warranto against the incumbent Chief Justice,
the Republic entreats this Court to declare Maria Lourdes P. A. Sereno
(respondent) ineligible to hold the highest post in the Judiciary for failing to.
regularly disclose her assets, liabilities and net worth as member of the career
service prior to her appointment as an Associate Justice, and later as Chief
Justice, of the Supreme Court, in violation of the Constitution, the Anti-Graft Law,
and the Code of Conduct and Ethical Standards for Public Officials and
Employees. The Republic accordingly seeks the nullification of respondent's
appointment, asserting that her failure to file the required disclosures and her
failure to submit the same to the Judicial and Bar Council show that she is not
possessed of "proven integrity" demanded of every aspirant to the Judiciary.
The Case
Invoking the Court's original jurisdiction under Section 5(1), Article VIII of the
Constitution in relation to the special civil action under Rule 66 of the Rules of
Court, the Republic of the Philippines (Republic), through the Office of the Solicitor
General (OSG) filed the present Petition5 for the issuance of the extraordinary writ
of quo warranto to declare as void respondent's appointment as Chief Justice of
the Supreme Court and to oust and altogether exclude respondent therefrom.
The Antecedents
From November 1986 to June 1, 2006, or spanning period of 20 years, respondent
served as member of the faculty of the University of the Philippines-College of Law
(U.P. or U.P. College of Law), initially as temporary faculty member (from
November 1986 to December 31, 1991) and thereafter, as permanent faculty
member until her resignation therefrom on June 1, 2006.6 As regular faculty
member, respondent was paid by the month by U.P.7
Based on the records of the U.P. Human Resources Development Office (U.P.
HRD0),8 respondent was on official leave from the U.P. College of Law for the
following periods:
June 1, 2000 - May 31, 2001
June 1, 2001 - May 31, 2002
November 1, 2003 - October 31, 2004
June 1, 2004 - February 10, 2005
November 1, 2004 - October 31, 2005
February 11, 2005 - May 31, 2006
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 November 15, 2005 - May 31, 2006 a, MIAA
General
While being employed at the U.P. College of Law, or from October 2003 to 2006, Manager
respondent was concurrently employed as legal counsel of the Republic in two Alfonso
international arbitrations: (a) PIATCO v. Republic of the Philippines and MIAA; and Cusi, Sen.
(b) Fraport AG Frankfurt Airport Services Worldwide v. Republic of the Edgardo
Philippines (PIATCO cases).9 Angara,
Sec.
The Personal Data Sheet (PDS) accomplished under oath by respondent further Salvador
details, among others, the following engagements/services rendered by her for Escudero,
various government agencies:10 Underseret
No. ary
Fro of Department/Ag Nature of Thomas
Position To Supervisor Aquino,
m Year ency work
s Amb. Lilia
Bautista
Legal 199 200 14 Various Legal Executive
Counsel 4 8 yrs. agencies of various Secretaries Deputy Commissioner Legal and Acting
government internation Alberto Commissio on Human Administrat Chairman
Office of the al trade Romulo, ner Rights (UP ive & Comm.
President, and Eduardo Diliman, Abelardo
Office of the investment Ermita and Commonwealth Aportadera
Solicitor law in Leandro Ave., QC, (TEL: 687-
General, Manila WTO Mendoza, TEL:928-7098) 7571)
International (Geneva), Chief Incidentally, the U.P. HRDO certified that there was no record on respondent's 201
Airport ICSID Presidentia file of any permission to engage in limited practice of profession.11 Her
Authority, (Washingto l Legal engagement as legal counsel for the Republic continued until 2009.12
Department of n, DC). Counsel
Agriculture, ICC-ICA Avelino Despite having been employed at the U.P. College of Law from November 1986 to
Department of (Singapore Cruz and June 1, 2006, the record of the U.P. HRDO only contains the Statement of Assets,
Trade and , Paris) Merceditas Liabilities and Net Worth (SALN) for
Industry, WTO- and in Gutierrez; 1985,13 1990,14 1991,15 1993,16 1994,17 1995,18 1996,19 1997,20 and 2002,21 filed by
AFTA bilateral Solicitor respondent. On the other hand, the records of the Central Records Division of the
Commission, dispute Generals Office of the Ombudsman yields that there is no SALN filed by respondent for
Philippine resolution Alfredo calendar years 1999 to 2009 except for the SALN ending December 1998 which
Coconut mechanis Benipayo, was subscribed only in August 2003 and transmitted by the U.P. HRDO to the
Authority ms Antonio Ombudsman only on December 16, 2003.22 Belatedly, in respondent's Ad
Nachura Cautelam Manifestation/Submission, she attached copy of her SALN for
and Agnes 198923 which she supposedly sourced from the "filing cabinets"24 or "drawers of
Devanader U.P."25 Similarly, despite having been employed as legal counsel of various
Page 216 of 507
Cases – Special Civil Actions (Part 1)
government agencies from 2003 to 2009, there is likewise no showing that she
SALN as of
filed her SALNs for these years, except for the SALN ending December 31, 2009 SALN ending December
November 1986 November 1986
which was unsubscribed and filed before the Office of the Clerk of Court only on 31, 1985
(entry SALN)
June 22, 2012.
-no record of SALN as
After having served as professor at the U.P. College of Law until 2006, and
November 1986 (entry
thereafter as practitioner in various outfits including as legal counsel for the
SALN)-
Republic until 2009, the respondent submitted her application for the position of
Associate Justice of the Supreme Court in July 2010. SALN ending
1987 December 31, -no record-
In support of her application as Associate Justice, respondent submitted to the
1986
Office of Recruitment Selection and Nomination (ORSN) of the Judicial and Bar
Council (JBC) her SALN for the year 2006.26 This SALN for 2006 bears no stamp SALN ending
received by the U.P. HRDO and was signed on July 27, 2010.27According to 1988 December 31, -no record-
respondent, the JBC considered her nomination for the position of Associate 1987
Justice as that of private practitioner and not as government employee.28 Only
recently, in letter29 to the ORSN dated February 2, 2018, likewise attached to SALN ending
her Ad Cautelam Manifestation/Submission, respondent would explain that such 1989 December 31, -no record-
SALN was really intended to be her SALN as of July 27, 2010. 30 Respondent 1988
further explained during the Oral Arguments that she merely downloaded the
SALN form and forgot to erase the year "2006" printed thereon and that she was SALN ending December
not required by the ORSN to submit subscribed SALN. 31 SALN ending 31, 1989 (sourced by
1990 December 31, respondent from one of
Thus, as the certifications executed by the U.P. HRDO, the Ombudsman and the 1989 the "filing cabinets" or
ORSN of the JBC stand, the only SALNs available on record and filed by "drawers" of U.P.)
respondent were those for the calendar years 1985, 1989, 1990, 1991, 1993,
1994, 1995, 1996, 1997, 1998, and 2002 or eleven (11) SALNs filed in her 20-year SALN ending
government service in U.P. No SALNs were filed from 2003 to 2006 when she was SALN ending December
1991 December 31,
employed as legal counsel for the Republic. Neither was there SALN filed when 31, 1990
1990
she resigned from U.P. College of Law as of June 1, 2006 and when she
supposedly re-entered government service as of August 16, 2010. SALN ending
SALN ending December
1992 December 31,
In tabular form, respondent's inclusive years in government employment vis-a- 31, 1991
1991
vis the SALNs filed by her and available on record are as follows:
As faculty member of the U.P. SALN ending
College of Law: 1993 December 31, -no record-
1992
SALN ought to SALN actually filed by
Year SALN ending
be filed respondent SALN ending December
1994 December 31,
31, 1993
1993
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 SALN ending SALN ending
SALN ending December
1995 December 31, 2005 December 31, -no record-
31, 1994
1994 2004

SALN ending SALN ending

SALN ending December
1996 December 31, 2006 December 31, -no record-
31, 1995
1995 2005

SALN ending SALN as of June

SALN ending December -no record of SALN as of
1997 December 31, June 1, 2006 1, 2006 (exit
31, 1996 June 1, 2006 (exit SALN)
1996 SALN)

SALN ending Alleged break in

SALN ending December
1998 December 31, government service from
31, 1997
1997 June 2, 2006 until August
15, 2009 but was engaged
SALN ending December legal counsel for the
SALN ending
31, 1998 (filed with the Republic from June2, 2006
1999 December 31,
Ombudsman on to 2009.
1998
December 16, 2003)
SALN ending December
SALN ending 31, 2009 but filed with the
2000 December 31, -no record- Office of the Clerk
1999 Court En Banc only on
SALN as of
June 22, 2012 and
August 16, 2010 August 16, 2010
SALN ending unsubscribed
(re-entry SALN)
2001 December 31, -no record-
2000 -no record of SALN as
August 16, 2010 (re-entry
SALN ending SALN)-
2002 December 31, -no record-
2001 SALN ending
SALN ending December
2011 December 31,
SALN ending 31, 2010 but unsubscribed
SALN ending December 2010
2003 December31,
31, 2002
2002 SALN ending
SALN ending December
2012 December 31,
SALN ending 31, 2011
2011
2004 December 31, -no record-
2003 A month after, or on August 13, 2010, respondent was appointed by then
President Benigno C. Aquino III (President Aquino III) as Associate Justice, and on

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Cases – Special Civil Actions (Part 1)
August 16, 2010, respondent took her oath of office as such.
When the position of the Chief Justice was declared vacant in 2012, the JBC
announced32 the opening for application and recommendation of the position of
Chief Justice. During the 2012 deliberations for the position of the Chief Justice,
the members of the JBC En Banc were Associate Justice Diosdado M. Peralta
(Justice Peralta) as Acting ex officio Chairman; Undersecretary Michael Frederick
L. Musngi as ex officio member vice Leila M. De Lima; Senator Francis Joseph G.
Escudero and Representative Niel Tupas as ex officio members representing the
Congress; Justice Regino C. Hermosisima Jr. as regular member representing the
retired Supreme Court Justices; Justice Aurora Santiago Lagman as regular
member representing the Private Sector; Atty. Maria Milagros N. Fernan-Cayosa
as regular member representing the Integrated Bar of the Philippines; and Atty.
Jose V. Mejia as regular member representing the academe. The JBC Executive
Committee (Execom) was composed of the JBC Regular Members and assisted
by the Office of the Executive Officer (OEO) headed by Atty. Annaliza S. Ty-
Capacite (Atty. Capacite).
The JBC announcement was preceded by an En Banc meeting held on June 4,
2012 wherein the JBC agreed to require the applicants for the Chief Justice
position to submit, instead of the usual submission of the SALNs for the last two
years of public service, all previous SALNs up to December 31, 2011 for those in
government service.33 However, for the other judicial vacancies, the JBC required
the submission of only two SALNs.34 Accordingly, in the
Announcement35 published on June 5, 2012, the JBC specifically directed the
candidates for the Chief Justice post to submit, in addition to the usual
documentary requirements, the following:
(1) Sworn Statement of Assets, Liabilities, and Networth (SALN):
a. for those in the government: all previous SALNs (up to
31 December 2011)
b. for those from the private sector: SALN as of 31
December 2011
(2) Waiver in favor of the JBC of the confidentiality of local and foreign bank
accounts under the Bank Secrecy Law and Foreign Currency Deposits
Act.36 (Emphasis ours)
The JBC announcement further provided that "applicants with incomplete or out-of-
date documentary requirements will not be interviewed or considered for
nomination."37
Nevertheless, the JBC En Banc subsequently agreed to extend the deadline for
the filing of applications or recommendations to July 2, 2012 and the submission of
the other documentary requirements to July 17, 2012. 38
On June 25, 2012, the JBC En Banc resolved not to require the incumbent
Supreme Court Justices who are candidates for the Chief Justice position to
submit other documentary requirements, particularly the required clearances.
Instead, the JBC En Banc required the incumbent Justices to submit only the
SALNs, bank waiver, medical certificate, laboratory results and the PDS.
On July 2, 2012, respondent accepted several nominations from the legal and the
evangelical community for the position of Chief Justice and in support of her
nomination, respondent submitted to the ORSN her SALNs for the years
2009,39 2010,40 and 2011.41 Respondent also executed waiver of
confidentiality42 of her local and foreign bank accounts. 43
On July 6, 2012, or even before the deadline of the submission of the documentary
requirements on July 17, 2012, the JBC En Banc came up with long list of the
candidates totaling twenty-two (22), respondent included, and scheduled the public
interview of said candidates on July 24-27, 2012.44
On July 20, 2012, the JBC in its Special En Banc Meeting,45 deliberated on the
candidates for the position of Chief Justice with incomplete documentary
requirements. In particular, the JBC examined the list of candidates and their
compliance with the required submission of SALNs. The minutes of the JBC
deliberation reveal as follows:
xxxx
The Executive Officer asked for clarification, particularly with respect to SALNs,
whether five (5) SALNs would constitute substantial compliance if the candidate
has been in the government service for twenty (20) years.
The Council examined the list with regard to the SALNs, particularly the candidates
coming from the government, and identified who among them would be considered
to have substantially complied:
1. Justice Arturo D. Brion has substantially complied
2. Justice Antonio Carpio has substantially complied
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3. Secretary Leila M. De Lima has substantially complied
4. Chairperson Teresita J. Herbosa has complied
5. Solicitor General Francis H. Jardeleza has complied
6. Justice Teresita J. Leonardo-De Castro has substantially complied
7. Dean Raul C. Pangalangan
The Executive Officer informed the Council that Dean Pangalangan lacks five (5)
SALNs. She was informed that he could not obtain them from the U.P., but he is
trying to get from the Civil Service Commission.
Justice Lagman moved that the SALNs of Dean Pangalangan be considered as
substantial compliance.
8. Congressman Rufus B. Rodriguez
Justice Peralta said that as per the report, Congressman Rodriguez did not submit
even one SALN. He commented that he may not be interested although he
accepted his nomination.
The Executive Officer informed the Council that he is abroad. He was notified
through email, as his secretary would not give his contact number.
9. Commissioner Rene V. Sarmiento has lacking SALNs
10. Justice Maria Lourdes P. A. Sereno
The Executive Officer informed the Council that she had not submitted her
SALNs for period of ten (10) years, that is, from 1986 to 2006.
Senator Escudero mentioned that Justice Sereno was his professor at U.P.
and that they were required to submit SALNs during those years.
11. Judge Manuel OJ Siayngco has complied Atty. Cayosa mentioned that Judge
Siayngco has to submit certificate of exemption because judges are also required
to comply with that requirement.
12. Dean Amado D. Valdez has lacking requirements
13. Justice Presbitero J. Velasco, Jr. has complied
14. Atty. Vicente R. Velasquez has lacking requirements
15. Dean Cesar L. Villanueva has lacking requirements
16. Atty. Ronaldo B. Zamora has lacking SALNs and MCLE cert.
x x x.46 (Emphasis ours)
Because there were several candidates with incomplete documentary
requirements, the JBC En Banc agreed to again extend the deadline for the
submission of the lacking requirements to July 23, 2012 and that the determination
of whether candidate has substantially complied with the requirements be
delegated to the Execom. It also appears that the JBC En Banc further agreed that
the candidates who fail to complete the requirements on said date are to be
excluded from the list of candidates to be interviewed and considered for
nomination, unless they would be included if in the determination of the Execom he
or she has substantially complied.47
Thus, on July 20, 2012, the ORSN, through its then Chief Atty. Richard Pascual
(Atty. Pascual), inquired as to respondent's SALNs for the years 1995, 1996, 1997
and 1999.48 During the Congressional hearings on impeachment, Atty. Pascual
would later on testify that he asked respondent to submit her SALNs from 1996 to
2006, or spanning period of 10 years.49 During the Oral Arguments, respondent
would maintain that Atty. Pascual only required her to submit her SALNs from
1995-1999 and did not ask for her more recent SALNs. Either way, the years
requested from respondent are within the period (1986 to 2006) covered by her
employment with the U.P. College of Law.
In response, the respondent, in the afternoon of July 23, 2012, transmitted
letter50 of even date to the JBC, which stated:
xxxx
As had noted in my Personal Data Sheet, after my resignation from government
service in 2006, as professor at the University of the Philippines, I became full-time
private practitioner. Hence, when I was nominated for the position of Associate
Justice of the Supreme Court in 2010, my nomination was considered as that of
private practitioner, and not as government employee. Thus, the requirements
imposed on me in connection with the consideration of my name, were those
imposed on nominees from the private sector, and my earlier-terminated
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government service, did not control nor dominate the kind of requirements
imposed on me.
Considering that most of my government records in the academe are more than
fifteen years old, it is reasonable to consider it infeasible to retrieve all of those
files.
In any case, the University of the Philippines has already cleared me of all
academic/administrative responsibilities, money and property accountabilities and
from administrative charges as of 01 June 2006. Since it is the ministerial duty of
the Head of the Office to ensure that the SALNs of its personnel are properly filed
and accomplished (CSC Resolution No. 060231 dated 01 February 2006 and CSC
Memorandum Circular No. 10-2006 dated 17 April 2006), this clearance can be
taken as an assurance that my previous government employer considered the
SALN requirements to have been met copy of the Clearance dated 19 September
2011 issued by the University of the Philippine is hereby attached.
In the 05 June 2012 Announcement, the Judicial and Bar Council imposed the
requirement of submitting all previous SALNs for those in the government. As
pointed out earlier, my service in government is not continuous. The period of my
private practice between my service in the University of the Philippines ending in
2006 and my appointment to the Supreme Court in 2010 presents break in
government service. Hence, in compliance with the documentary requirements for
my candidacy as Chief Justice, submitted only the SALNs from end of 2009 up to
31 December 2011, since am considered to have been returned to public office
and rendered government service anew from the time of my appointment as
Associate Justice on 16 August 2010.
Considering that have been previously cleared from all administrative
responsibilities and accountabilities from my entire earlier truncated government
service, may kindly request that the requirements that need to comply with, be
similarly viewed as that from private sector, before my appointment to the
Government again 2010 as Associate Justice of the Supreme Court.
x x x x51
The letter dated July 23, 2012 was received by the Office of the Administrative and
Financial Services (OAFS) and copies thereof were received by the offices of the
JBC regular members, the ORSN and the OEO.52 The letter, however, was neither
examined by the JBC regular members nor was it deliberated upon either by the
JBC En Banc or the Execom.53 Although the determination of whether candidate
has substantially complied with the documentary requirements was delegated to
the Execom, the latter could not produce any minutes of the meeting or record that
the members thereof deliberated on the July 23, 2012 letter of respondent. 54
On the scheduled date of the interview on July 24, 2012, despite respondent's
submission of only SALNs, Atty. Pascual prepared Report Re: Documentary
Requirements and SALN of candidates for the Position of Chief Justice of the
Philippines55 wherein respondent was listed as applicant No. 14 with an opposite
annotation that she had "COMPLETE REQUIREMENTS" and note stating "Letter
7/23/12 considering that her government records in the academe are more than 15
years old, it is reasonable to consider it infeasible to retrieve all those files."
The JBC then proceeded to interview the candidates, including respondent who
was interviewed on July 27, 2012. On August 6, 2012, the ORSN prepared list of
the 20 candidates, respondent included, vis-a-vis their SALN submissions.
Opposite respondent's name was an enumeration of the SALNs she
submitted, i.e., 2009, 2010 and 2011 and an excerpt from her July 23, 2012 letter
that "considering that [respondent's] government records in the academe are more
than 15 years old, it is reasonable to consider it infeasible to retrieve all those
files." On August 13, 2012, the JBC voted on who would be included in the short
list and on the same day, transmitted to the President its nominations 56 for the
position of Chief Justice, as follows:
1. Carpio, Antonio T.
2. Abad, Roberto A.
3. Brion, Arturo D.
4. Jardeleza, Francis H.
5. Sereno, Maria Lourdes P.A.
6. Zamora, Ronalda B.
7. Leonardo-De Castro, Teresita J.
8. Villanueva, Cesar L.
A month after respondent's acceptance of her nomination, or on August 24, 2012,
respondent was appointed by then President Aquino III as Chief Justice of the
Supreme Court.
On August 30, 2017, or five years after respondent's appointment as Chief Justice,
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an impeachment complaint was filed by Atty. Larry Gadon (Atty. Gadon) against
respondent with the Committee on Justice of the House of Representatives (House
Committee on Justice) for culpable violation of the Constitution, corruption, high
crimes, and betrayal of public trust. The complaint also alleged that respondent
failed to make truthful declarations in her SALNs.
The impeachment complaint was endorsed by several members of the House and,
thereafter, was found to be sufficient in form and substance. The respondent filed
her answer to the impeachment complaint. After the filing of the reply and the
rejoinder, the House Committee on Justice conducted several hearings on the
determination of probable cause, the last of which was held on February 27,
2018.57
During these hearings, it was revealed that respondent purportedly failed to file her
SALNs while she was member of the faculty of the U.P. College of Law and that
she filed her SALN only for the years 1998, 2002 and 2006. During the hearing on
February 7, 2018 of the House Committee on Justice, Justice Peralta, as resource
person being then the acting ex officio Chairman of the JBC, further claimed that
during the JBC deliberations in 2012, he was not made aware that respondent
submitted incomplete SALNs nor that respondent's letter dated July 23, 2012 to
the JBC was ever deliberated upon.58 This was confirmed by Atty. Fernan--
Cayosa;59 by Atty. Capacite, who emphasized that based on the rubber stamp
received, only the offices of the JBC regular members, the ORSN and the OEO
were furnished copies of the letter;60 and by Atty. Pascual on the basis of the
transmittal-letter.61
The foregoing sworn declarations made during the hearings before the House
Committee on Justice spawned two relevant incidents: one, the proposal of the
House Committee for this Court to investigate on the proceedings of the JBC
relative to the nomination of respondent as Chief Justice which is now presently
docketed as A.M. No. 17-11-12 and A.M. No. 17-11-17-SC; and two, the
Letter62 dated February 21, 2018 of Atty. Eligio Mallari to the OSG requesting that
the latter, in representation of the Republic, initiate quo warranto proceeding
against respondent.
Thus, the present petition.
The Case for the Republic
The Republic, through the OSG, claims that an action for quo warranto is the
proper remedy to question the validity of respondent's appointment. It alleges that
the instant petition is seasonably filed within the one-year reglementary period
under Section 11, Rule 66,63 of the Rules of Court since respondent's
transgressions only came to light during the proceedings of the House Committee
on Justice on the allegations of the impeachment complaint filed against her.
Alternatively, the Republic claims that it has an imprescriptible right to bring quo
warranto petition under the maxim nullum tempus occurit regi.
In justifying resort to petition for quo warranto, the Republic argues that quo
warranto is available as remedy even as against impeachable officers, like
respondent. The Republic argues that petition for quo warranto is different from the
impeachment proceedings because the writ of quo warranto is being sought to
question the validity of her appointment, while the impeachment complaint accuses
her of committing culpable violation of the Constitution and betrayal of public trust
while in office.64 Citing the 2010 Rules of the Presidential Electoral Tribunal (PET)
and the cases of Funa v. Chairman Villar65 and Nacionalista Party v. De
Vera,66 the Republic argues that quo warranto may be resorted to even against
impeachable officers and that the respondent's assumption of the position as Chief
Justice under the color of an executive appointment is public wrong correctible
by quo warranto.
The Republic seeks to oust respondent from her position as Chief Justice on the
ground that the latter failed to show that she is person of proven integrity which is
an indispensable qualification for membership in the Judiciary under Section
7(3),67 Article VIII of the Constitution. According to the Republic, because
respondent failed to fulfill the JBC requirement of filing the complete SALNs, her
integrity remains unproven. The Republic posits that the JBC's ostensible
nomination of respondent does not extinguish the fact that the latter failed to
comply with the SALN requirement as the filing thereof remains to be constitutional
and statutory requirement.68
In sum, the Republic contends that respondent's failure to submit her SALNs as
required by the JBC disqualifies her, at the outset, from being candidate for the
position of Chief Justice. Lacking her SALNs, respondent has not proven her
integrity which is requirement under the Constitution. The Republic thus concludes
that since respondent is ineligible for the position of Chief Justice for lack of proven
integrity, she has no right to hold office and may therefore be ousted via quo
warranto.
The Case for the Respondent
Being circumspect in the examination of every pleading and document on record,
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this Court observes that, initially, the Comment Ad Cautelam dated March 16,
2018 filed before Us was neither signed by the respondent herself nor verified to
have been read by her and attested by her that the allegations therein are true and
correct of her personal knowledge or based on authentic records. This Court is not
unaware that under the Rules of Court, specifically Section 4, Rule 7, not all
pleadings need to be under oath, verified, or accompanied by an affidavit. In fact,
the rules on quo warranto do not require the filing of such comment, but pursuant
to the dictates of the fundamental right of due process and also the desire of this
Court to dispose of this case judiciously, impartially, and objectively, this Court
gave the respondent the opportunity to be heard and oppose the allegations in the
petition by requiring her to file comment thereto. Thus, this Court anticipated
response from the respondent to take such opportunity to settle the uncertainty of
her nomination and appointment through her comment to the petition. What was
received by this Court, however, was an unverified Comment repudiating the
Court's jurisdiction, merely signed by counsel, who appeared to be representing
the respondent.
Wary of the legal implications of such unverified pleading, i.e. possible refutation of
the allegations stated therein and repudiation of the signing counsel's authority to
represent, this Court in its April 3, 2018 Resolution69 set as condition for the
conduct of Oral Arguments prayed for by respondent, that the latter affirm and
verify under oath the truth and veracity of the allegations in the Comment Ad
Cautelam filed by counsel supposedly on her behalf.
In an Ad Cautelam Partial Compliance/Manifestation dated April 5, 2018,
respondent affirmed and verified under oath the truth and veracity of the
allegations in the said Comment Ad Cautelam through Verification dated April 6,
2018 attached therein.
In the said Comment Ad Cautelam, respondent argues that, on the strength of
Section 2,70 Article XI of the 1987 Constitution and the cases of Mayor Lecaroz v.
Sandiganbayan,71Cuenco v. Hon. Fernan,72In Re: First Indorsement from Hon.
Gonzales,73 and Re: Complaint-Affidavit for Disbarment Against Senior Associate
Justice Antonio T. Carpio,74 the Chief Justice may be ousted from office only by
impeachment. Respondent contends that the use of the phrase "may be removed
from office" in Section 2, Article XI of the Constitution does not signify that
Members of the Supreme Court may be removed through modes other than
impeachment. According to respondent, the clear intention of the framers of the
Constitution was to create an exclusive category of public officers who can be
removed only by impeachment and not otherwise.
It is likewise the argument of respondent that since petition for quo warranto may
be filed before the RTC, such would result to conundrum because judge of lower
court would have effectively exercised disciplinary power and administrative
supervision over an official of the Judiciary much higher in rank and is contrary to
Sections and 11, Article VIII of the Constitution which vests upon the Supreme
Court disciplinary and administrative power over all courts and the personnel
thereof. She theorizes that if Member of the Supreme Court can be ousted
through quo warranto initiated by the OSG, the Congress' "check" on the Supreme
Court through impeachment would be rendered inutile.
Respondent argues that the present petition is time-barred as Section 11, Rule 66
provides that petition for quo warranto must be filed within one (1) year from the
"cause of ouster" and not from the "discovery" of the disqualification. Respondent
contends that the supposed "failure" to file the required SALNs allegedly took
place for several years from 1986 to 2006, thus, the "cause of ouster" existed even
before the respondent was appointed as Chief Justice on August 24, 2012.
Therefore, as early as her appointment, the Republic, through the OSG, already
had cause of action to seek her ouster. Even assuming that the one-year
prescriptive period may be counted from the Republic's "discovery" of the
disqualification, the petition would still be time-barred since the Republic would
have made such "discovery" through U.P., considering that the U.P. HRDO is
required to submit list of employees who failed to file their SALNs.
Respondent avers that the Court cannot presume that she failed to file her SALNs
because as public officer, she enjoys the presumption that her appointment to
office was regular. According to respondent, the Republic failed to overcome this
presumption as the documents relied upon by it, i.e., certifications from the U.P.
HRDO and the Ombudsman, do not categorically state that respondent failed to
file her SALNs. On the contrary, respondent points out that the U.P. HRDO had
certified that she had been cleared of all administrative responsibilities and
charges as of June 1, 2006 and that there was no pending administrative charge
against her.
It is likewise the contention of respondent that public officers without pay or those
who do not receive compensation are not required to file SALN. Thus, respondent
argues that for the periods that she was on official leave without pay, she was
actually not required to file any SALN for the inclusive years. She adds that to
require the submission of SALNs as an absolute requirement is to expand the
qualifications provided for under the Constitution.
Nonetheless, respondent represents that she continues to recover and retrieve her
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missing SALNs and will present them before the Senate sitting as the
Impeachment Tribunal and not to this Court considering her objections to the
latter's exercise of jurisdiction.
Respondent also stresses that the failure to file SALNs or to submit the same to
the JBC has no bearing on one's integrity. The submission of SALNs was simply
among the additional documents which the JBC had required of the applicants for
the position of Chief Justice. It is respondent's position that the non-filing of SALN
is not ground for disqualification unless the same was already the subject of
pending criminal or administrative case or if the applicant had already been finally
convicted for criminal offense involving said failure to file SALNs. In this case,
respondent points out that the JBC was made aware as early as July 20, 2012 that
respondent had not submitted to the JBC her SALNs as U.P. professor and yet
none of them invoked Section 2, Rule 10 of JBC-009 or the "integrity rule."
Respondent likewise contends that the issue of whether an applicant for the
position of Chief Justice is person of "proven integrity" is question "constitutionally
committed to the JBC" and is therefore political question which only the JBC could
answer, and it did so in the affirmative when it included respondent's name in the
shortlist of nominees for the position of Chief Justice.
The Republic's Reply
In refuting respondent's arguments, the Republic justifies its resort to the
unconventional method of quo warranto. The Republic cites the cases of Estrada
v. Desierto75 and Lawyers League for Better Philippines and/or Oliver Lozano v.
President Corazon Aquino et al.76 where this Court took cognizance of petition
for quo warranto to oust an impeachable official. It reiterates its argument that it
seeks respondent's ouster, not on account of commission of impeachable
offenses, but because of her ineligibility to assume the position of Chief Justice.
The Republic maintains that the phrase "may be removed from office" in Section 2,
Article XI of the Constitution means that Members of the Supreme Court may be
removed through modes other than impeachment and disagrees with respondent's
interpretation that the word "may" qualifies only the penalty imposable after the
impeachment trial, i.e., removal from office. The Republic claims that respondent's
interpretation would lead to an absurd situation in the event that the Senate
imposes lesser penalty, like suspension of the President, which would result in
vacancy in the position not intended by the Constitution. This is because vacancy
in the Office of the President occurs only in case of death, permanent disability,
removal from office, or resignation, in which event the Vice-President shall become
the President to serve the unexpired term.
Invoking the verba legis principle in statutory construction, the Republic claims that
Section 2, Article XI of the Constitution does not expressly prohibit resort to other
means to remove impeachable officers in position.
Contrary to respondent's claim that this Court has no disciplinary authority over its
incumbent members, the Republic cites Section 13 of A.M. No. 10-4-20-SC which
created permanent Committee on Ethics and Ethical Standards, tasked to
investigate complaints involving graft and corruption and ethical violations against
members of the Supreme Court. The Republic points out that such Ethics
Committee conducted the investigation in A.M. No. 10-7-17-SC77 and A.M. No. 09-
2-19-SC.78
Meanwhile, in support of its claim that the petition is not time-barred, the Republic
explains that the State has continuous interest in ensuring that those who partake
of its sovereign powers are qualified. It argues that the one-year period provided
under Section 11 of Rule 66 merely applies to individuals who are claiming rights
to public office, and not to the State. To consider the instant petition as time-
barred, the Republic argues, is to force the State to spend its resources in favor of
an unqualified person.
Further, the Republic claims that even if it be assumed that the one year period
applies against the State, it cannot be deemed to have been notified of
respondent's failure to file her SALNs. It argues that it has no statutory obligation
to monitor compliance of government employees other than its own. It alleges that
SALNs are not published, hence it has no feasible way of taking cognizance of
respondent's failure to file SALN.
In any case, the Republic claims that the unique circumstances of the instant case
behoove this Court to be liberal in interpreting the one-year reglementary period.
As to the question on jurisdiction, the Republic contends that the Supreme Court is
clothed with the authority to determine respondent's qualifications and eligibility to
hold the position of the Chief Justice. It argues that the determination of this issue
is not political question because such issue may be resolved through the
interpretation of the pertinent provisions of the Constitution, laws, JBC rules, and
Canons of Judicial Ethics.
Going to the fundamental issue of respondent's eligibility to hold the position of
Chief Justice, the Republic reiterates that respondent failed to comply with the
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requirement of submitting SALNs and thus has failed to prove her integrity.
Further, the Republic cites respondent's gross misrepresentation in stating that her
reason for non-submission of SALNs was because she could no longer retrieve all
of such SALNs. According to the Republic, respondent's allegation seems to imply
that she did file her SALNs when the Certifications from the U.P. and the
Ombudsman state otherwise.
The Republic posits that respondent's lack of integrity is further bolstered by her
failure to disclose to the JBC that she failed to file her SALN 11 times during her
tenure as U.P. Law Professor.
Integrity, the Republic claims, is simply faithful adherence to the law, and the filing
of SALN is qualification implied from the requirement of integrity. The filing of
SALN is not an additional requirement unduly imposed on applicants to positions in
the Judiciary. When respondent failed to file her SALN, she did not comply with the
Constitution, laws and appropriate codes of conduct. There is no need to allege or
prove graft and corruption in order to prove an aspiring magistrate's lack of
integrity.
Finally, the Republic contends that the presumption of regularity cannot be applied
in respondent's favor. The Republic claims that such presumption attaches only to
official acts and not to all acts of officials. The presumption, according to the
Republic, applies only to official acts specified by law as an official duty or to
function attached to public position. In this case, the filing of SALN is neither an
official duty nor function attached to position of U.P. College of Law Professor. In
any case, the Republic claims that it has successfully disputed such presumption
through the Certifications it presented from U.P. and the Ombudsman.
The Republic's Memorandum
In addition to the arguments put forth by the Republic in the Petition and the Reply,
the Republic further justified its non-inclusion of the JBC in the instant petition. It
contends that since the petition only disputes the respondent's eligibility to become
the Chief Justice, the Solicitor General correctly instituted the quo warranto petition
only against respondent.
Insisting on respondent's lack of integrity, the Republic argues that respondent had
the legal obligation to disclose to the JBC that she failed to file her SALNs at least
11 times, citing the case of OCA v. Judge Estacion Jr.79
The Republic also argues that respondent's claim of good faith is not defense.
Republic Act (R.A.) No. 301980 and R.A. No. 671381 are special laws and are thus
governed by the concept of malum prohibitum, wherein malice or criminal intent is
completely immaterial. Thus, her act of blaming the Review and Compliance
Committee of U.P. for its failure to inform her that she had no SALNs on file does
not exonerate her. The Republic further notes that respondent resorted to the
fallacy of tu quoque a diversionary tactic by using the fault of others to justify one's
own fault.
Believing in the strength of its case, the Republic underscores its contention that
the respondent was not able to dispute the evidence put forth by the Republic that
she failed to religiously file her SALNs throughout her entire stint in the
government. The Republic claims that it is futile for respondent to merely allege
during the Oral Arguments that she filed her SALNs and will produce them before
the Senate. Respondent's admissions during the Oral Arguments, together with
the U.P. HRDO's certification, prove that she did not religiously file her SALNs as
required by law.
As to the applicability of this Court's ruling in Concerned Taxpayer v. Doblada,
Jr.,82 the Republic argues that the case is not on all fours with the instant petition.
The Doblada ruling, according to the OSG, did not involve issues on qualifications
to public office unlike the present petition. Second, unlike in Doblada, respondent
in this case failed to offer any countervailing evidence to disprove the Certifications
by the U.P. HRDO and the Ombudsman. Lastly, the statement in Doblada relied
upon by the respondent is mere dictum. The issue therein is centered on
Doblada's unexplained wealth. Furthermore, Dobladawas decided only in 2005 or
after respondent violated the legal requirement on the filing of SALNs.
The Respondent's Memorandum
Respondent insists that she can be removed from office only through
impeachment. In addition to the arguments raised in her Comment Ad Cautelam,
respondent asserts that impeachment was chosen as the method of removing
certain high-ranking government officers to shield them from harassment suits that
will prevent them from performing their functions which are vital to the continued
operations of government. Such purpose, according to respondent, would be
defeated if Section 2, Article XI of the Constitution would not be construed as
providing an exclusive means for the removal of impeachable officers. Respondent
argues that it would be absurd for the framers of the Constitution to provide very
cumbersome process for removing said officers only to allow less difficult means to
achieve the same purpose.
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Respondent contends that the Republic, in citing the 2010 PET Rules and the
cases of Estrada v. Desierto83 and Lawyers League for Better Philippines and/or
Oliver Lozano v. President Corazon Aquino et al.,84 erroneously lumps together the
Chief Justice, the President and the Vice-President, simply because they are all
impeachable officers. Respondent argues that there are substantial distinctions
between the President and Vice-President on the one hand, and Members of the
Supreme Court on the other: first, unlike Section 4, Article VII of the 1987
Constitution vesting in the Court the power to be the "sole judge" of all contests
relating to the qualifications of the President and the Vice-President, there is no
similar provision with respect to the other impeachable officials, i.e., the Members
of this Court, the Members of the Constitutional Commission or the Ombudsman;
and second, the President and Vice-President are elected officials while the other
impeachable officers are appointive officials.
Respondent also argues that there is not single pronouncement in Funa v.
Chairman Villar,85 and Nacionalista Party v. De Vera86 (by way of ruling or obiter
dictum) to the effect that an impeachable officer may be ousted through writ of quo
warranto, and that both cases were not even for quo warranto.
Respondent maintains that whether respondent was person of "proven integrity"
when she applied for the position of Chief Justice is political question outside the
jurisdiction of this Honorable Court, which only the JBC and the President as the
appointing authority could determine. She avers that the application of the political
question doctrine is not confined to the President or Congress, as the Republic
supposedly argues, but extends to other government departments or officers
exercising discretionary powers, such as the JBC which uses its wisdom and
discretion in determining whether an applicant to the Judiciary is person of
"proven" integrity.
Respondent also contends that absent any challenge to her nomination and
appointment on the ground of grave abuse of discretion on the part of the JBC and
the President, her appointment can no longer be questioned.
Respondent reiterates that the instant petition is time-barred. She argues that the
Republic cannot rely on Agcaoili v. Suguitan87 because it mentioned the
principle nullum temus occurit regi or "no time runs against the king" only in
passing, as the "general rule concerning limitation of action in quo
warrantoproceedings." She avers that Agcaoili is in fact authority for the principle
that prescription will definitely run against the State if the rule or statute clearly so
provides.
Respondent avers that she complied with the SALN laws as Professor of the U.P.
College of Law and that the law presumes regularity in the filing of SALNs.
According to respondent, that at least 11 of her SALNs have been found tends to
prove pattern of filing, rather than non-filing.
Respondent argues that the burden of proof in quo warranto proceedings falls on
the party who brings the action and that based on Doblada, the Republic failed to
discharge this burden. Respondent claims that the records of the U.P. HRDO are
incomplete and unreliable and there was no categorical statement in its
Certification that she failed to file her SALNs for the years 1986, 1987, 1988, 1989,
1992, 1999, 2000, 2001, 2003, 2004, 2005, and 2006. Further, she avers that the
records of the Office of the Ombudsman are even more incomplete and unreliable,
thus, any certification from said office would likewise be insufficient to prove that
she failed to file 11 of her SALNs while she was U.P. Professor.
Respondent contends that she has actually presented preponderant evidence that
she filed her SALNs. She avers that she has recovered 11 of her U.P. SALNs and
she has direct proof that she executed at least 12 SALNs as U.P. Professor. She
stresses that the U.P. HRDO has thrice "cleared" her of all administrative
responsibilities and administrative charges.
Respondent also claims that she was not even required to file SALN from 1986 to
1991 because her status and appointment then was merely temporary. According
to her, the fact that she served as counsel for the Republic for the PIATCO cases
in 2004, 2005 and 2006 does not negate her defense that under the law, she was
not required to file her SALNs for the years when she was on leave and was not
receiving compensation arising from public office (i.e., 2001, 2004, 2005 and
2006).
Respondent's Memorandum also sought to address certain matters raised during
the Oral Arguments.
As to where her SALNs are, respondent avers that some of her SALNs were in fact
found in the records of the U.P. HRDO, and she was able to retrieve copies of
some of her SALNs from the U.P. Law Center. Without prejudice to her
jurisdictional objections, she attached them to the Memorandum. She argues that
the fact that the SALNs for certain years are missing cannot give rise to the
inference that they were not filed. She points out that U.P. was only required to
keep the SALNs for period of ten (10) years after receipt of the statement, after
which the SALN may be destroyed.
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In explaining her statement before the JBC that her SALNs were irretrievable,
respondent avers that she honestly could not retrieve copies from U.P. over the
course of weekend given to her to complete her missing documentary
requirements. She declares that she did not keep copies of her SALNs and she
was not required to do so by law.
Respondent asserts that her 2009 SALN was not belatedly filed. She explains that
her 2009 SALN is an entry SALN which she originally filed on September 16, 2010
within thirty (30) days after her assumption of office as an Associate Justice of the
Supreme Court. According to her, the revised 2009 SALN which has the
annotation "revised as of 22 June 2012," is revised version executed in June 2012
to more accurately reflect the acquisition cost of certain assets declared in 2010.
With respect to the purported 2006 SALN, respondent avers that it was not the
SALN required by RA 6713, but mere statement of her assets which the JBC
requested as tool to determine her assets for comparison with her income tax
returns. She explains that she merely happened to use downloadable SALN form
which she filled up and dated as of the time of its writing, i.e., July 27, 2010. She
claims that she never misrepresented the same to be her 2006 exit SALN from
U.P. According to her, she in fact considers her 2006 SALN as one of the missing
SALNs she is still trying to locate.
Respondent claims that she could not recall all the circumstances why her 1998
SALN was executed only in 2003 which, according to her, was reasonable since it
happened 15 years ago. She claims that there is no law prohibiting her from
submitting the same, and the fact that the SALN was filed serves the purpose of
the law and negates any intention to hide unexplained wealth.
It is also respondent's position that the omission of her husband's signature on her
2011 SALN was inadvertent and was not an offense. According to her, it could not
adversely impact on her integrity absent any allegation or finding that she acquired
ill-gotten wealth. She argues that the Civil Service Commission's Guidelines which
require the signature of the spouse who is not public officer, was promulgated only
in January 2013.
With regard to the jewelry she acquired from 1986 to 1991 which were supposedly
declared in her 1991 SALN but were undeclared in her 1990 SALN, respondent
avers that these assets were actually declared in her 1985 and 1989 SALNs, and
they were consistently declared in all her subsequent SALNs beginning 1991.
According to respondent, she should not be faulted for her inadvertent omission to
declare such assets in her 1990 SALN as her declaration of the same thereafter is
consistent with good faith and cured whatever error there may have been in her
1990 SALN. She argues that said assets were not manifestly disproportionate to
her lawful income and even as U.P. Professor, she could have afforded to
purchase jewelry worth Php15,000.00 over span of six (6) years.
Finally, respondent argues that it is an "unreasonable and oppressive"
interpretation of the law to reckon her entry SALN as Associate Justice of the
Court from the date of her appointment (August 16, 2010) and not from Decembr
31, 2009 when it was actually filed. Respondent contends that R.A. No. 6713 only
requires that the SALN be filed "within thirty days after assumption of office" a
directive she supposedly complied with. She argues that while the Implementing
Rules and Regulations of R.A. No. 6713 state that the SALN should be reckoned
from the first day of service, the law provides for review and compliance procedure
which requires that reporting individual first be informed and provided an
opportunity to take necessary corrective action should there be any error in her
SALN. Respondent avers that she did not receive any notice or compliance order
informing her that her entry SALN was erroneous, and she was not directed to take
the necessary corrective action.
The Respondent's Reply/Supplement to Memorandum
At the close of the Oral Argument, granted upon respondent's Ad
Cautelam motion, the Court specifically required the parties to submit their
respective memoranda within non-extendible period of ten (10) days, after which,
the petition shall be submitted for decision. Notwithstanding such clear directive
from the Court, and even without being required to, respondent moves (again Ad
Cautelam) for the inclusion of her Reply/Supplement to her memorandum filed
beyond the period granted by the Court to the parties. The belated filing of said
Reply/Supplement in disregard of the Court's directive merits its non-admission.
Nevertheless, as the Court remains circumspect of the pleadings submitted by the
parties and in accordance with the dictates of due process and fair play,
respondent's Reply/Supplement to her Memorandum, albeit filed Ad Cautelam, is
admitted.
Respondent raises two points in her Reply/Supplement: first, the new matter of tax
fraud allegedly committed by her; and second, the forumshopping allegedly
committed by the Republic.
Respondent sought to address the inclusion of the charge of tax fraud allegedly
committed by her relative to the fees she received in the PIATCO cases which
respondent argues to have been raised by the Republic only in its memorandum.
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Respondent denies having concealed or under declared her income in the
PIATCO cases. She further points out that the Summary and the Powerpoint
presentation prepared by BIR Deputy Commissioner Gtiballa and which were
attached to the Republic's memorandum were incomplete, inaccurate and merely
preliminary. In any case, respondent avers that BIR Deputy Commissioner Guballa
himself found that respondent had "substantially declared all income (legal fees)
from the PIATCO case in her ITRs from years 2004 to 2009 BUT there were
certain discrepancies."88
Respondent also accuses the Republic of having committed deliberate forum-
shopping in filing the action for quo warranto even when the impeachment
proceeding was already pending before the House of Representatives. Contending
that all the elements of forum-shopping are present, respondent points to the (1)
identity of parties between the quo warranto action and the impeachment case
inasmuch as the House Committee on Justice is also part of the Government; (2)
identity of causes of action considering that the quo warranto case is based on
respondent's alleged lack of proven integrity for failure to file all her SALNs when
she was teaching at the U.P. College of Law and for concealing her true income
and evasion of taxes which were the same attacks on her eligibility and
qualifications as enumerated in the Articles of Impeachment; and (3) identity in the
relief sought as both the quo warranto and the impeachment sought her removal
from the Office of the Chief Justice.
The Motions for Intervention
Through Joint Motion for Leave to Intervene and Admit Attached Comment-In-
Intervention, movant-intervenors composed of (1) former CEO of PAG-IBIG Fund,
Zorayda Amelia Capistrano Alonzo, (2) peace human rights advocate Remedios
Mapa Suplido, (3) urban poor advocate Alicia Gentolia Murphy, (4) Chairperson of
Pambansang Kilusan ng mga Samahang Magsasaka (PAKISAMA) Noland Merida
Penas, (5) Fr. Roberto Reyes, and (6) poet, feminist youth advocate Reyanne Joy
P. Librado (Capistrano, et al.,) seek to intervene in the present petition as citizens
and taxpayers.
The comment-in-intervention is virtual echo of the arguments raised in
respondent's comment that quo warranto is an improper remedy against
impeachable officials who may be removed only by impeachment and that the
application of the PET rules are limited only to the President and Vice-President'
who are elective, and not appointive, officials. Movant-intervenors similarly argue
that the petition is already time-barred as the cause of action arose upon
respondent's appointment as Chief Justice on August 24, 2012 or almost six (6)
years ago.
Capistrano et al. argue that it is not incumbent upon respondent to prove to the
JBC that she possessed the integrity required by the Constitution for members of
the Judiciary; rather, the onus of determining whether or not she qualified for the
post fell upon the JBC. They also posit that nowhere in the Constitution is the
submission of all prior SALNs required; instead, what is required is that all aspiring
justices of the Court must have the imprimatur of the JBC, the best proof of which
is person's inclusion in the shortlist.
Capistrano et al. persuade that respondent's explanation that her government
records in the academe for 15 years are irretrievable is reasonable and that
respondent did not mislead the JBC. On the contrary, they claim that the JBC
accepted her explanation when it deemed respondent as qualified. In doing so,
they conclude, that the JBC determined that she possessed the integrity as
required by the Constitution.
A few hours after the filing of the Capistrano et. al.'s Comment-in-Intervention,
another set of intervenors composed of: (1) BAYAN MUNA Representative (Rep.)
Carlos Isagani Zarate; (2) ACT Teachers Partylist Rep. Antonio Tinio Francisca
Castro; (3) GABRIELA Women's Party Rep. Emerenciana De Jesus Arlene
Brosas; (3) ANAKPAWIS Partylist Rep. Ariel Casilao; (5) KABATAAN Partylist
Rep. Sarah Jane Elago; (6) Convenors and members of Movement Against
Tyranny (MAT), namely: Francisco A. Alcuaz, Bonifacio P. Ilagan, Col. George A.
Rabusa (Ret.); (7) Former Senator Rene A.V. Saguisag; (8) Bishop Broderick S.
Pabillo, D.D.; (9) Secretary Gen. of Bagong Alyansang Makabayan (BAYAN)
Renato M. Reyes, Jr.; (10) Member of MDD Youth (an Affiliate of Aksyon
Demokratiko) Kaye Ann Legaspi; and (11) Secretary General of National Union of
People's Lawyers Atty. Ephraim B. Cortez (Zarate, et al.,) filed Motion for Leave to
File Motion to Intervene and Opposition-in Intervention, pursuant to Rule 19 of the
Rules of Court. They claim that as citizens and taxpayers, they have legal interest
in the matter of respondent's ouster or removal.
Zarate et al. raise the similar argument that the Chief Justice of the Supreme Court
may only be removed from office on impeachment for, and conviction of, culpable
violation of the constitution, treason, bribery, graft and corruption, other high
crimes, or betrayal of public trust and that it is only the Congress who has the
power to remove the Chief Justice through the exclusive mode of impeachment.
They further argue that the issue of respondent's non-submission of complete
SALNs, without more, does not have the effect of putting to question her integrity
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as she did not conceal her SALNs. They argue that the qualification of having
"proven integrity" is standard subject to the discretion of, first, the JBC who
submits the list of qualified candidates; and second, of the President, who will
select among the shortlist whom to appoint as Chief Justice.
Movant-Intervenor Rene A.V. Saguisag subsequently filed Supplement to Motion
for Leave to File Motion to Intervene and Opposition-in-Intervention CumPetition to
Recuse seeking the inhibition of unnamed Members of this Court who "may have
prematurely thrown their weight on the other side, actually or perceptually" on the
ground that respondent is entitled to an impartial arbiter.
As well, the Integrated Bar of the Philippines (IBP) filed its Motion for Leave to File
and to Admit Attached Opposition-in-Intervention as an organization of all
Philippine lawyers, having the fundamental duty to uphold the Constitution and an
interest in ensuring the validity of the appointments to the Judiciary. The IBP's
arguments reflect the arguments of the respondent and the other movant-
intervenors that the quo warranto petition is time-barred and is unavailable against
an impeachable officer. The IBP further argues that the determination of whether
respondent is of "proven integrity" belongs to the JBC and which question the
Court cannot inquire into without violating the separation of powers. It is likewise
the contention of the IBP that the petition is fatally flawed since the JBC never
required the submission of respondent's SALNs from 2001 to 2006.
Also seeking to intervene in the instant petition, Senators Leila M. De Lima
(Senator De Lima) and Antonio F. Trillanes IV (Senator Trillanes) as citizens,
taxpayers, and senators of the Republic, filed Motion to Intervene and Admit
Attached Opposition-In-Intervention (Ad Cautelam) on April 4, 2018.
In the said Motion, Senators De Lima and Trillanes assert that they possess clear
legal interest, both personal and official, in the subject matter of the Republic's
petition to oust the Chief justice on the ground that she does not possess the
constitutional requirement of integrity. According to Senators De Lima and
Trillanes, they have the right and duty to uphold the Constitution and to oppose
government actions that are clearly and patently unconstitutional. It is also
Senators De Lima and Trillanes' theory that the instant quo warranto case is aimed
to deprive the Senate of its jurisdiction as the impeachment tribunal. They argue
that their mandated duty as judges in the possible impeachment trial of the Chief
Justice will be pre-emptect and negated if the quo warranto petition will be granted.
Their claimed legal interest in their intervention in and opposition to the petition
for quo warranto is mainly anchored upon their duty and prerogatives as Senators-
judges in an impeachment trial and to protect the institution of impeachment as
mode of enforcing accountability.
Senators De Lima and Trillanes' Opposition-In-Intervention is mere reiteration of
the respondent's argument that this Court has no jurisdiction over petition for quo
warranto against an impeachable officer. They argue that the Chief Justice of the
Supreme Court is, by express provision of the Consitution, removable from office
exclusively by impeachment. They also aver that the ground raised in the petition
for quo warranto lack of integrity for failing to submit one's SALN is part of the
allegations in the impeachment case being heard in the House of Representatives.
Thus, they argue that the use of an identical ground in quo warranto proceeding
directly undermines the jurisdiction of the Senate to hear and decide impeachment
cases and the prerogative of the senators to try the same.
Senators De Lima and Trillanes also advance the argument that the Constitution
identifies and enumerates only three qualifications for appointment to the Supreme
Court: (1) natural born citizenship; (2) age, i.e., at least forty years; and (3) an
experience of at least 15 years either as judge of lower court or in the practice of
law in the Philippines. They assert that the filing of SALN, taking of psychological
or physical examination, and similar requirements, are merely discretionary
administrative requirements for consideration of the JBC, not Constitutional
requirements, hence, can be waived, removed entirely, or adjusted by the JBC in
the exercise of its discretion. According to the said movantintervenors, Section
7(3), Article VIII of the 1987 Constitution, which states that, "[a] Member of the
Judiciary must be person of proven competence, integrity, probity, and
independence", does not speak of objective constitutional qualifications, but only of
subjective characteristics of judge. They, therefore, contend that "qualifications"
such as citizenship, age, and experience are enforceable while "characteristics"
such as competence, integrity, probity, and independence are mere subjective
considerations.
Corollarily, Senators De Lima and Trillanes argue that the subjective
considerations are not susceptible to analysis with tools of legal doctrine. Hence,
questions on this matter are for the consideration of political institutions under the
Constitution, i.e., the JBC and the President (prior to appointment) and the House
of Representatives and the Senate (after appointment).
The Motions for Inhibition
By way of separately filed motions, respondent seeks affirmative relief, in the form
of the inhibition of five (5) Justices of the Court, the jurisdiction of which she
questions and assails. Respondent prays for the inhibition of Associate Justices
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Lucas P. Bersamin, Diosdado M. Peralta, Francis H. Jardeleza, Noel Gimenez
Tijam, and Teresita J. Leonardo-De Castro from hearing and deciding the present
petition.
In common, respondent imputes actual bias on said Justices for having testified
before the House Committee on Justice on the impeachment complaint. In
particular, respondent considered Justice Bersamin's allusion to respondent as
"dictator" and his personal resentment about the supposed withdrawal of the
privilege previously enjoyed by the members of the Court to recommend nominees
to vacant positions in the Judiciary, as evidence of actual bias.
Justice Peralta's inhibition, on the other hand, is being sought because as then
Acting ex officio Chairperson of the JBC when respondent was nominated for
appointment as Chief Justice, he would have personal knowledge of disputed
evidentiary facts concerning the proceedings and for having served as material
witness in the matter in controversy.
Justice Jardeleza's inhibition is sought on the ground that his testimony before the
House Committee on Justice reveals that he harbors ill feelings towards
respondent on account of the latter's challenge to his integrity during the
nomination process for the Associate Justice position vice Justice Roberto A. Abad
which he characterized as "inhumane".
Respondent seeks the inhibition of Justice Tijam based on the latter's statement as
quoted in Manila Times article to the effect that if respondent continues to ignore
and to refuse to participate in the impeachment process, she is clearly liable for
culpable violation of the Constitution.
Respondent likewise made mention that Justice Tijam and Justice Bersamin wore
touch of red during the "Red Monday" protest on March 12, 2018 wherein judges
and court employees reportedly called on respondent to make the supreme
sacrifice and resign.
Respondent also calls for the inhibition of Justice De Castro for having allegedly
prejudged the issue as regards the validity of respondent's nomination and
appointment in 2012 when Justice De Castro testified under oath during the House
Committee on Justice hearings that respondent should have been disqualified from
the shortlist on account of the SALNs she allegedly failed to submit.
At the last minute, respondent also seeks to disqualify Justice Samuel R. Martires
for his purported insinuations during the Oral Arguments questioning her "mental"
or "psychological" fitness on the basis of her belief that God is "the source of
everything in (her) life."89
Respondent also prays that the Ad Cautelam Respectful Motions for Inhibitions of
Associate Justices Peralta, Leonardo-De Castro, Jardeleza, Tijam, Bersamin and
Martires be resolved by the Court En Banc, without the participation of the Justices
she seeks to disqualify.
The Issues
From the arguments raised by the parties and the issues as delineated in the
Advisory governing the special Oral Arguments by way of accommodation to
respondent, the paramount issues to be resolved by the Court are:
1. Whether the Court can assume jurisdiction and give due course to the instant
petition for quo warranto against respondent who is an impeachable officer and
against whom an impeachment complaint has already been filed with the House of
Representatives;
2. Whether the petition is outrightly dismissible on the ground of prescription;
3. Whether respondent is eligible for the position of Chief Justice:
a. Whether the determination of candidate's eligibility for nomination is the sole
and exclusive function of the JBC and whether such determination. partakes of the
character of political question outside the Court's supervisory and review powers;
b. Whether respondent failed to file her SALNs as mandated by the Constitution
and required by the law and its implementing rules and regulations; and if so,
whether the failure to file SALNs voids the nomination and appointment of
respondent as Chief Justice;
c. Whether respondent failed to comply with the submission of SALNs as required
by the JBC; and if so, whether the failure to submit SALNs to the JBC voids the
nomination and appointment of respondent as Chief Justice;
d. In case of finding that respondent is ineligible to hold the position of Chief
Justice, whether the subsequent nomination by the JBC and the appointment by
the President cured such ineligibility.
4. Whether respondent is de jure or de facto officer.
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 The Ruling of the Court
Preliminary Issues
Intervention is an ancillary remedy restricted in purpose and in time
Intervention is remedy by which third party, not originally impleaded in the
proceedings, becomes litigant therein for certain purpose: to enable the third party
to protect or preserve right or interest that may be affected by those proceedings. 90
Nevertheless, the remedy of intervention is not matter of right but rests on the
sound discretion of the court upon compliance with the first requirement on legal
interest and the second requirement that no delay and prejudice should result as
spelled out under Section 1, Rule 19 of the Rules of Court, as follows:
Sec. 1. Who may intervene. A person who has legal interest in the matter in
litigation, or in the success of either of the parties, or an interest against both, or is
so situated as to be adversely affected by distribution or other disposition of
property in the custody of the court or of an officer thereof may, with leave of court,
be allowed to intervene in the action. The court shall consider whether or not the
intervention will unduly delay or prejudice the adjudication of the rights of the
original parties, and whether or not the intervenor's rights may be fully protected in
separate proceeding.
Each of the movant-intervenors in this case seek to intervene as citizens and
taxpayers, whose claimed interest to justify their intervention is their "sense of
patriotism and their common desire to protect and uphold the Philippine
Constitution". The movant-intervenors further assert "public right" to intervene in
the instant case by virtue of its "transcendental importance for the Filipino people
as whole". Apart from such naked allegations, movant-intervenors failed to
establish to the Court's satisfaction the required legal interest. Our jurisprudence is
well-settled on the matter:
Intervention is not matter of absolute right but may be permitted by the court when
the applicant shows facts which satisfy the requirements of the statute
authorizing intervention. Under our Rules of Court, what qualifies person to
intervene is his possession of legal interest in the matter in litigation or in the
success of either of the parties, or an interest against both; or when he is so
situated as to be adversely affected by distribution or other disposition of property
in the custody of the court or an officer thereof. As regards the legal interest as
qualifying factor, this Court has ruled that such interest must be of direct and
immediate character so that the intervenor will either gain or lose by the
direct legal operation of the judgment. The interest must be actual and
material, concern which is more than mere curiosity, or academic or
sentimental desire; it must not be indirect and contingent, indirect and
remote, conjectural, consequential or collateral. x x x.91 (Emphasis ours)
Clearly, herein movant-intervenors' sentiments, no matter how noble, do not, in
any way, come within the purview of the concept of "legal interest" contemplated
under the Rules to justify the allowance of intervention. Movant-intervenors failed
to show any legal interest of such nature that they will "either gain or lose by the
direct legal operation of the judgment". Even the IBP's assertion of their
"fundamental duty to uphold the Constitution, advocate for the rule of law, and
safeguard the administration of justice", being the official organization of all
Philippine lawyers, will not suffice. Admittedly, their interest is merely out of
"sentimental desire" to uphold the rule of law. Meanwhile, Senators De Lima and
Trillanes' claimed legal interest is mainly grounded upon their would be
participation in the impeachment trial as Senators-judges if the articles of
impeachment will be filed before the Senate as the impeachment court.
Nevertheless, the fact remains that as of the moment, such interest is still
contingent on the filing of the articles of impeachment before the Senate. It bears
stressing that the interest contemplated by law must be actual, substantial,
material, direct and immediate, and not simply contingent or expectant.92
Indeed, if every person, not parties to the action but assert their desire to uphold
the rule of law and the Constitution, were allowed to intervene, proceedings would
become unnecessarily complicated, expensive, and interminable.93
Emphatically, quo warranto proceeding is an action by the government against
individuals unlawfully holding an office. Section 1, Rule 66 provides:
Section 1. Action by Government against individuals. An action for the usurpation
of public office, position or franchise may be commenced by verified petition
brought in the name of the Republic of the Philippines against:
(a) person who usurps, intrudes into, or unlawfully holds or exercises public office,
position or franchise;
(b) public officer who does or suffers an act which, by the provision of law,
constitutes ground for the forfeiture of his office; or
(c) An association which acts as corporation within the Philippines without being
legally incorporated or without lawful authority so to act.
The remedy of quo warranto is vested in the people, and not in any private
individual or group, because disputes over title to public office are viewed as public
question of governmental legitimacy and not merely private quarrel among rival
claimants.94
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Newman v. United States ex Rel. Frizzell,95 historically traced the nature of quo
warranto proceedings as crime which could only be prosecuted in the name of the
King by his duly authorized law officers. In time, the criminal features of quo
warranto proceedings were modified and as such, the writ came to be used as
means to determine which of two claimants was entitled to an office and to order
the ouster and the payment of fine against the usurper. This quasi-criminal nature
of quo warranto proceedings was adopted in some American states.
Nonetheless, Newman explains that the Code of the District of Colombia, which
was the venue of the case, continues to treat usurpation of office as public wrong
which can be corrected only by proceeding in the name of the government itself.
Thus:
In sense in very important sense every citizen and every taxpayer is interested in
the enforcement of law, in the administration of law, and in having only qualified
officers execute the law. But that general interest is not private, but public interest.
Being such, it is to be represented by the Attorney General or the District Attorney,
who are expected by themselves or those they authorize to institute quo
warrantoproceedings against usurpers in the same way that they are expected to
institute proceedings against any other violator of the law. That general public
interest is not sufficient to authorize private citizen to institute such proceedings,
for, if it was, then every citizen and every taxpayer would have the same interest
and the same right to institute such proceedings, and public officer might, from the
beginning to the end of his term, be harassed with proceedings to try his title.
The only time that an individual, in his own name, may bring an action for quo
warranto is when such individual has claim over the position in question. Section of
Rule 66 of the Rules of Court provides:
Section 5. When an individual may commence such an action. A person claiming
to be entitled to public office or position usurped or unlawfully held or exercised by
another may bring an action therefor in his own name.
In this case, the movants-intervenors are neither individuals claiming to be entitled
to the questioned position nor are they the ones charged with the usurpation
thereof.
Furthermore, it should be emphasized that the movants-intervenors, in their
respective Motions, presented nothing more than mere reiteration of respondent's
allegations and arguments in her Comment.
For these reasons, the Court, in its Resolution96 dated April 3, 2018, resolved to
deny the motions for intervention respectively filed by Capistrano et al., and
Zarate et al., and to note the IBP's intervention. For similar reasons, the Court
resolves to deny the motion for intervention of Senators De Lima and Trillanes.
No basis for the Associate Justices of the Supreme Court to inhibit in the
case
The instant petition comes at the heels of the recently-concluded hearings on the
determination of probable cause in the impeachment complaint against respondent
before the House Committee on Justice. Several Members of the Court, both
incumbent and retired, were invited, under pain of contempt, to serve as resource
persons. Those Members who were present at the Committee hearings were
armed with the requisite imprimatur of the Court En Banc, given that the Members
are to testify only on matters within their personal knowledge and insofar as
material and relevant to the issues being heard. For lack of particularity, the Court
supposes that the attendance of some of its Members in the House Committee
hearings is the basis of movant-intervenor Saguisag's motion to recuse.
On the other hand, respondent was more emphatic when she sought affirmative
relief, in the form of the inhibition of six (6) Justices, of the Court, whose jurisdiction
she questions and assails. Specifically, respondent prays for the inhibition of
Associate Justices Lucas P. Bersamin, Diosdado M. Peralta, Francis H. Jardeleza,
Noel Gimenez Tijam, Teresita J. LeonardoDe Castro and Samuel R. Martires
fundamentally on the ground of actual bias for having commonly testified before
the House Committee on Justice on the impeachment case.
As for Justice Samuel R. Martires, respondent concludes Justice Martires'
manifested actual bias based on his statements during the Oral Arguments which
purportedly tended to question respondent's mental and psychological fitness.
In particular, respondent seeks the inhibition of Justice Tijam based on the latter's
statement as quoted in Manila Times article to the effect that if respondent
continues to ignore and to refuse to participate in the impeachment process, she is
clearly liable for culpable violation of the Constitution.
Respondent cites the article entitled, "Appear in Congress or vialate Constitution,"
dated December 4, 2017, where Justice Tijam was purportedly quoted to have
said:
Impeachment is constitutional process and mandate enshrined in the Constitution.
Justices took an oath to defend, preserve, protect the Constitution. If Chief
Justice Sereno continues to ignore and continues to refuse to participate in
the impeachment process, ergo, she is clearly liable for culpable violation of
the Constitution. (emphasis supplied)
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Respondent claims that the aforesaid statements of Justice Tijam are indicative of
his stance that there may be ground to impeach and remove respondent from
office, which is also the objective of the quo warranto petition against her.
Ultimately, the cause for inhibition simmers to the question of whether, in so
appearing and testifying before the House Committee on Justice, the Members of
the Court are precluded from hearing and deciding the instant petition for quo
warranto. To this, the Court answers in the negative.
Jurisprudence recognizes the right of litigants to seek disqualification of judges.
Indeed, elementary due process requires hearing before an impartial and
disinterested tribunal. "A judge has both the duty of rendering just decision and the
duty of doing it in manner completely free from suspicion as to its fairness and as
to his integrity."97
However, the right of party to seek the inhibition or disqualification of judge who
does not appear to be wholly free, disinterested, impartial and independent in
handling the case must be balanced with the latter's sacred duty to decide cases
without fear of repression. The movant must therefore prove the ground of bias
and prejudice by clear and convincing evidence to disqualify judge from
participating in particular trial. "[W]hile it is settled principle that opinions formed in
the course of judicial proceedings, based on the evidence presented and conduct
observed by the judge, do not prove personal bias or prejudice on the part of the
judge."98
A circumspect reading of Justice Tijam's statements in the Manila Times article
reveals that the manifest intent of the statements was only to prod respondent to
observe and respect the constitutional process of impeachment, and to exemplify
the ideals of public accountability, thus:
He added that he wanted to encourage Sereno to show up at the Congress
hearings "to respect and participate in the impeachment (process), and to
defend herself and protect the institution."
Sereno, he said, should be role model when it comes to respecting the
Constitution.
"Impeachment is not an invention of politicians. It was drafted by the framers of the
Constitution. Media, which propagates the myth that impeachment is numbers
game, hence, is political and arbitrary, fails to emphasize the fact that the rule of
the majority is the essence of democracy," the magistrate stressed.
Tijam believes that the impeachment process against Sereno is not an attack on
the high court or the Judiciary because the Supreme Court does not consist of the
chief justice alone.
"Impeachment is [neither] an assault on the Judiciary nor an infringement on the
independence of the Judiciary, because it is enshrined in the Constitution.
Parenthetically, when the SC strikes down acts of Congress and acts of the
President and the Executive Department for being unlawful and unconstitutional,
the SC is not assaulting the independence of Congress and the Executive
Department because the expanded power of judicial review is enshrined in the
Constitution," Tijam pointed out.
Sereno, he said, should be role model when it comes to respecting the
Constitution.99 (Emphasis ours)
Notably, respondent conveniently and casually invoked only portion of the article
which suited her objective of imputing bias against Justice Tijam.
As, to the act of wearing red tie which purportedly establishes Justices Tijam and
Bersamin's prejudice against her, the argument is baseless and unfair. There is no
basis, whether in logic or in law, to establish connection between piece of clothing
and magistrate's performance of adjudicatory functions. Absent compelling proof to
the contrary, the red piece of clothing was merely coincidental and should not be
deemed sufficient ground to disqualify them.
In Philippine Commercial International Bank v. Sps. Dy Hong Pi, et al.,100 this
Court explained that:
[T]he second paragraph of Rule 137, Section 1,101 does not give judges unfettered
discretion to decide whether to desist from hearing case. The inhibition must be for
just and valid causes, and in this regard, We have noted that the mere imputation
of bias or partiality is not enough ground for inhibition, especially when the charge
is without basis. This Court has to be shown acts or conduct clearly indicative of
arbitrariness or prejudice before it can brand them with the stigma of bias or
partiality. Moreover, extrinsic evidence is required to establish bias, bad faith,
malice or corrupt purpose, in addition to palpable error which may be inferred from
the decision or order itself. The only exception to the rule is when the error is so
gross and patent as to produce an ,ineluctable inference of bad faith or
malice.102 (Citations omitted)
In this case, it does not appear that there are grounds for compulsory inhibition. As
to voluntary inhibition, the mere fact that some of the Associate Justices
participated in the hearings of the Committee on Justice determining probable
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cause for the impeachment of respondent does not make them disqualified to hear
the instant petition. Their appearance thereat was in deference to the House of
Representatives whose constitutional duty to investigate the impeachment
complaint filed against respondent could not be doubted. Their appearance was
with the prior consent of the Supreme Court En Banc and they faithfully observed
the parameters that the Court set for the purpose. Their statements in the hearing,
should be carefully viewed within this context, and should not be hastily interpreted
as an adverse attack against respondent.
In fact, Justice Tijam, in his Sworn Statement103 submitted to the House
Committee on Justice, clearly identified the purpose of his attendance thereat:
2. In reply, sent letter to Representative Umali on November 24, 2017, informing
him that inasmuch as the issue involved actions of the Supreme Court En Banc, I
deemed it proper to first secure its approval before participating in the
House Committee hearing.
3. On November 28, 2017, the Supreme Court En Banc gave clearance for
Justices who have been invited by the House Committee on Justice to testify in
connection with the impeachment complaint, to give testimony on administrative
matters if they so wish. The Court's Resolution in this regard states that the
authority was granted "only because the proceedings before the Committee
on Justice of the House of Representatives constitute part of the
impeachment process under Section 3, Article XI of the 1987 Constitution."
A copy of the Court's Resolution is hereto attached as Annex "A."
4. am submitting this Sworn Statement to the House Committee on Justice as my
testimony in relation to A.M. No. 17-06-02-SC, based on my best recollection of
events relating to said matter and available records. shall, however, be willing to
give further testimony should the House Committee find it appropriate to propound
questions thereon at the December 11, 2017 Committee hearing, subject to
applicable limitations under law and relevant rules.
5. I will appear and give testimony before the House Committee on Justice
not as witness for the complainant, but to honor the Committee's
invitation to shed light on A.M. No. 17-06-02-SC and to accord due respect to
the Constitutionally established process of impeachment. (Emphasis ours)
Likewise, the Justices, including Justice Tijam, who appeared during the House
Committee on Justice hearings, refused to form any conclusion or to answer the
uniform query as to whether respondent's acts constitute impeachable offenses, as
it was not theirs to decide but function properly belonging to the Senate, sitting as
an impeachment court.104 Evidently, no bias and prejudice on the part of the
Justices could be inferred therein.
A judge may decide, "in the exercise of his sound discretion," to recuse himself
from case for just or valid reasons. The phrase just or valid reasons, as the second
requisite for voluntary inhibition, must be taken to mean -
x x x causes which, though not strictly falling within those enumerated in the first
paragraph, are akin or analogous thereto. In determining what causes are just,
judges must keep in mind that next to importance to the duty of rendering
righteous judgment is that of doing it in such manner as will beget no suspicion of
the fairness and integrity of the judge. For it is an accepted axiom that every
litigant, including the state, in criminal cases, is entitled to nothing less than the
cold neutrality of an impartial judge, and the law intends that no judge shall preside
in any case in which he is not wholly free, disinterested, impartial, and
independent.105
Respondent's call for inhibition has been based on speculations, or on distortions
of the language, context and meaning of the answers the Justices may have given
as sworn witnesses in the proceedings of the House Committee on Justice.
Justice Bersamin's statement that "Ang Supreme Court ay hindi po maaring mag
function kung isa ay diktador," is clearly hypothetical statement, an observation on
what would the Court be if any of its Members were to act dictatorially.
Likewise, the Court cannot ascribe bias in Justice Bersamin's remark that he was
offended by respondent's attitude in ignoring the collegiality of the Supreme Court
when she withdrew the Justices' "privilege" to recommend nominees to fill
vacancies in the Supreme Court. It would be presumptuous to equate this
statement to personal resentment as respondent regards it. There has always
been high degree of professionalism among the Members of the Court in both their
personal and official dealings with each other. It cannot also be denied that the
statement reflected natural sentiment towards decision reached and imposed by
member of collegial body without consultation or consensus.
Meanwhile, respondent's allegation of actual bias and partiality against Justice
Peralta is negated by his testimony during the January 15, 2018 hearing of the
House Committee on Justice, where he stated that he has been very supportive of
the Judiciary reforms introduced by respondent as the Chief Justice, even if she
suspects that he is one of those behind her impeachment.
Justice Peralta's testimony before the House Committee on Justice also
contradicts respondent's allegation that Justice Peralta's apparent bias arose from
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his belief that respondent caused the exclusion of his wife, Court of Appeals (CA)
Associate Justice Fernanda Lampas Peralta, from the list of applications for the
position of CA Presiding Justice. Justice Peralta has made it clear during the
February 12, 2018 Congressional hearing that he has already moved on from said
issue and that the purpose of his testimony was merely to protect prospective
applicants to the Judiciary.
Justice Peralta's testimony during the Congressional hearing that "had (he) been
informed of (the) letter dated July 23, 2012 and certificate of clearance, (he) could
have immediately objected to the selection of the Chief Justice for voting because
this is very clear deviation from existing rules that if member of the Judiciary would
like...or...a candidate would like to apply for Chief Justice, then she or he is
mandated to submit the SALNs," is clearly a' hypothetical statement, which will not
necessarily result in the disqualification of respondent from nomination. It was also
expressed in line with his functions as then Acting Chairperson of the JBC, tasked
with determining the constitutional and statutory eligibility of applicants for the
position of Chief Justice. It bears stressing, too, that at the time said statement was
made, the petition for quo warranto has not been filed; thus, such statement
cannot amount to prejudgment of the case.
Furthermore, according to Justice Peralta, while he was then the Acting Ex
Officio Chairperson of the JBC at the time of respondent's application for the
position of Chief Justice, he had no personal knowledge of the disputed facts
concerning the proceedings, specifically the matters considered by the members of
the JBC in preparing the shortlist of nominees. He explained that it was the ORSN
of the JBC which was tasked to determine completeness of the applicants'
documentary requirements, including the SALNs.
As for Justice Martires' statements during the Oral Arguments, this Court does not
view them as indication of actual bias or prejudice against respondent. Our review
of the record reveals that Justice Martires' did not refer to respondent as the object
of his statements, as follows:
JUSTICE MARTIRES :
Solicitor Calida, would you agree with me na lahat ng taong may dibdib ay may
kaba sa dibdib? At lahat ng taong may ulo ay may katok sa ulo.
SOLICITOR GENERAL CALIDA:
Yes, Your Honor, agree.
JUSTICE MARTIRES:
Now would you consider it mental illness (sic) when person always invokes God as
the source of his strength? The source of his inspiration? The source of
happiness? The source of everything in life? Is that mental illness.
SOLICITOR GENERAL CALIDA:
Not necessarily, Your Honor.
JUSTICE MARTIRES:
So, I'm just making follow-up to the question that Justice Velasco earlier asked.
So, would you agree with me that the psychiatrist made wrong evaluation with
respect to the psychiatric report of the Chief Justice?106
Neither are We prepared to conclude that Justice Martires' statements were based
on an extraneous source, other than what what he has learned or encountered
over the course of the instant proceedings. There is nothing in the interpellation,
nor in Justice Martires' statements that he has read the psychiatric report, nor has
read newspaper accounts tackling the same. He merely asked the OSG if he has
read the same, and his opinion regarding it.
Contrary to respondent's contentions, Justice Martires has not suggested that she
suffers from some mental or psychological illness. At most, his questions and
statements were merely hypothetical in nature, which do not even constitute as an
opinion against respondent. Certainly, to impute actual bias based on such brief
discourse with respect to hypothetical matters is conjectural and highly
speculative. "Allegations and perceptions of bias from the mere tenor and
language of judge is insufficient to show prejudgment."107
In the same vein, insinuations that the Justices of the Supreme Court are towing
the line of President Rodrigo Roa Duterte in entertaining the quo warrantopetition
must be struck for being unfounded and for sowing seeds of mistrust and
discordance between the Court and the public. The Members of the Court are
beholden to no one, except to the sovereign Filipino people who ordained and
promulgated the Constitution. It is thus inappropriate to misrepresent that the
Solicitor General who has supposedly met consistent litigation success before the
Supreme Court shall likewise automatically and positively be received in the
present quo warranto action. That the Court spares the Solicitor General the rod is
easily dispelled by the Court's firm orders in G.R. Nos. 234359 and 234484
concerning alleged extra legal killings a case directly concerning the actuations of
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the executive department to provide the Court with documents relative to the
Oplan Tokhang operations and by uninamous vote, rebuked the Solicitor General's
plea for reconsideration. Suffice to say that the Court decides based on the merits
of case and not on the actors or the supposed benefactors involved.
Absent strong and compelling evidence establishing actual bias and partiality on
the part of the Justices whose recusal was sought, respondent's motions for
inhibition must perforce fail. Mere conjectures and speculations cannot justify the
inhibition of Judge or Justice from judicial matter. The presumption that the judge
will undertake his noble role of dispensing justice in accordance with law and
evidence, and without fear or favor, should not be abandoned without clear and
convincing evidence to the contrary.
In Dimo Realty Development, Inc. v. Dimaculangan,108 We held:
"[B]ias and prejudice, to be considered valid reasons for the voluntary inhibition of
judges, must be proved with clear and convincing evidence. Bare allegations of
partiality and prejudgment will not suffice. These cannot be presumed, especially if
weighed against the sacred obligation of judges whose oaths of office require them
to administer justice without respect to person and to do equal right to the poor and
the rich."109 (Citation omitted)
The Court has pointedly observed in Pimentel v. Hon. Salanga:110
Efforts to attain fair, just and impartial trial and decision, have natural and alluring
appeal. But, we are not licensed to indulge in unjustified assumptions, or make
speculative approach to this ideal. It ill behooves this Court to tar and feather
judge as biased or prejudiced, simply because counsel for party litigant
happens to complain against him. As applied here, respondent judge has not
as yet crossed the line that divides partiality and impartiality. He has not
thus far stepped to one side of the fulcrum. No act or conduct of his would
show arbitrariness or prejudice. Therefore, we are not to assume what
respondent judge, not otherwise legally disqualified, will do in case before
him. We have had occasion to rule in criminal case that charge made before
trial that party "will not be given fair, impartial and just hearing" is
"premature." Prejudice is not to be presumed. Especially if weighed against
judge's legal obligation under his oath to administer justice "without respect
to prison and do equal right to the poor and the rich." To disqualify or not to
disqualify himself then, as far as respondent judge is concerned, is matter of
conscience.111 (Citations omitted and emphasis ours)
The Court has consequently counseled that no Judge or Justice who is not legally
disqualified should evade the duty and responsibility to sit in the adjudication of
any controversy without committing dereliction of duty for which he or she may be
held accountable. Towards that end, the Court has aptly reminded:
To take or not to take cognizance of case, does not depend upon the discretion of
judge not legally disqualified to sit in given case. It is his duty not to sit in its trial
and decision if legally disqualified; but if the judge is not disqualified, it is matter of
official duty for him to proceed with the trial and decision of the case. He cannot
shirk the responsibility without the risk of being called upon to account for his
dereliction.112
It is timely to be reminded, too, that the Supreme Court is collegial judicial body
whose every Member has solemnly and individually sworn to dispense and
administer justice to every litigant. As collegial body, the Supreme Court
adjudicates without fear or favor. The only things that the Supreme Court
collectively focuses its attention to in every case are the merits thereof, and the
arguments of the parties on the issues submitted for consideration and
deliberation. Only thereby may the solemn individual oath of the Members to do
justice be obeyed.
In line with the foregoing, We deem it baseless, not to mention problematic, the
respondent's prayer that the matter of inhibition of the six Associate Justices be
decided by the remaining members of the Court En Banc. The respondent herself
was cognizant that the prevailing rule allows challenged Justices to participate in
the deliberations on the matter of their disqualification. Moreover, exclusion from
the deliberations due to delicadeza or sense of decency, partakes of ground apt for
voluntary inhibition. It bears to be reminded that voluntary inhibition, leaves to the
sound discretion of the judges concerned whether to sit in case for other just and
valid reasons, with only their conscience as guide.113 Indeed, the best person to
determine the propriety of sitting in case rests with the magistrate sought to be
disqualified. Moreover, to compel the remaining members to decide on the
challenged member's fitness to resolve the case is to give them authority to review
the propriety of acts of their colleagues, scenario which can undermine the
independence of each of the members of the High Court.
In the En Banc case of Jurado Co. v. Hongkong Bank,114 the Court elucidated that
challenge to the competency of judge may admit two constructions: first, the
magistrate decides for himself the question of his competency and when he does
so, his decision therein is conclusive and the other Members of the Court have no
voice in it; and second, the challenged magistrate sits with the Court and decides
the challenge as collegial body. It was in Jurado that the Court adopted the second
view as the proper approach when challenge is poised on the competency of
sitting magistrate, that is, the Court, together withthe challenged magistrate,
decides. Jurado further expressly excluded possible third construction wherein the
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Court decides the challenge but without the participation of the challenged member
on the ground that such construction would place power on party to halt the
proceedings by the simple expedient of challenging majority of the Justices. The
Court sees no reason to deviate from its standing practice of resolving competency
challenges as collegial body without excluding the challenged Member from
participating therein.
Accordingly, the Court resolves to DENY respondent's motion to exclude
Associate Justices Peralta, Leonardo-De Castro, Jardeleza, Tijam, Bersamin, and
Martires in the resolution of the separate motions' for inhibition against the said
Associate Justices. Likewise, the Court resolves to DENY the said separate
motions for inhibition.
Substantive Issues
I.
The Court has Jurisdiction over the instant Petition for Quo Warranto
The petition challenges respondent's right and title to the position of Chief Justice.
The Republic avers that respondent unlawfully holds her office because in failing to
regularly declare her assets, liabilities and net worth as member of the career
service prior to her appointment as an Associate Justice, and later as Chief
Justice, of the Court, she cannot be said to possess the requirement of proven
integrity demanded of every aspiring member of the Judiciary. The Republic thus
prays that respondent's appointment as Chief Justice be declared void.
Respondent counters that, as an impeachable officer, she may only be removed
through impeachment by the Senate sitting as an impeachment court.
Supreme Court has original jurisdiction over an action for quo warranto
Section 5, Article VIII of the Constitution, in part, provides that the Supreme Court
shall exercise original jurisdiction over petitions for certiorari, prohibition,
mandamus, quo warranto, and habeas corpus. This Court, the Court of Appeals
and the Regional Trial Courts have concurrent jurisdiction to issue the
extraordinary writs, including quo warranto.
Relatedly, Section 7, Rule 66 of the Rules of Court provides that the venue of an
action for quo warranto, when commenced by the Solicitor General, is either the
Regional Trial Court in the City of Manila, in the Court of Appeals, or in the
Supreme Court.
While the hierarchy of courts serves as general determinant of the appropriate
forum for petitions for the extraordinary writs, cl.irect invocation of the Supreme
Court's original jurisdiction to issue such writs is allowed when there are special
and important reasons therefor, clearly and specifically set out in the petition. 115 In
the instant case, direct resort to the Court is justified considering that the action
for quo warranto questions the qualification of no less than Member of the Court.
The issue of whether person usurps, intrudes into, or unlawfully holds or exercises
public office is matter of public concern over which the government takes special
interest as it obviously cannot allow an intruder or impostor to occupy public
position.116
The instant petition is case of transcendental importance
While traditionally, the principle of transcendental importance applies as an
exception to the rule requiring locus standi before the Courts can exercise its
judicial power of review, the same principle nevertheless, finds application in this
case as it is without doubt that the State maintains an interest on the issue of the
legality of the Chief Justice's appointment.
Further, it is apparent that the instant petition is one of first impression and of
paramount importance to the public in the sense that the qualification, eligibility
and appointment of an incumbent Chief Justice, the highest official of the Judiciary,
are being scrutinized through an action for quo warranto. The Court's action on the
present petition has far-reaching implications, and it is paramount that the Court
make definitive pronouncements on the issues herein presented for the guidance
of the bench, bar, and the public in future analogous cases. Thus, the questions
herein presented merit serious consideration from the Court and should not be
trifled on.
Policy and ethical considerations likewise behoove this Court to rule on the issues
put forth by the parties. This Court has always been vigilant advocate in ensuring
that its members and employees continuously possess the highest ideals of
integrity, honesty, and uprightness. More than professional competence, this Court
is cognizant of the reality that the strength of Our institution depends on the
confidence reposed on Us by the public. As can be gleaned from Our recent
decisions, this Court has not hesitated from disciplining its members whether they
be judges, Justices or regular court employees. This case should not therefore be
treated merely with kid gloves because it involves the highest official of the judicial
branch of the government. On the contrary, this is an opportune time for this Court
to exact accountability by examining whether there has been strict compliance with
the legal and procedural requirements in the appointment of its Members.
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Respondent, however, pounds on the fact that as member of the Supreme Court,
she is an impeachable officer. As such, respondent argues that quo
warranto proceeding, which may result in her ouster, cannot be lodged against her,
especially when there is an impending impeachment case against her.
This argument is misplaced.
The origin, nature and purpose of impeachment and quo warranto are
materially different
While both impeachment and quo warranto may result in the ouster of the public
official, the two proceedings materially differ. At its most basic, impeachment
proceedings are political in nature, while an action for quo warranto is judicial or
proceeding traditionally lodged in the courts.
To lend proper context, We briefly recount the origin and nature of impeachment
proceedings and quo warranto petition:
Impeachment
Historians trace the origin of impeachment as far as the 5th century in ancient
Greece in process called eisangelia.117 The grounds for impeachment include
treason, conspiracy against the democracy, betrayal of strategic posts or
expeditionary forces and corruption and deception.118
Its, modem form, however, appears to be inspired by the British parliamentary
system of impeachment. Though both public and private officials can be the
subject of the process, the British system of impeachment is largely similar to the
current procedure in that it is undertaken in both Houses of the Parliament. The
House of Commons determines when an impeachment should be instituted. If the
grounds, normally for treason and other high crimes and misdemeanor, are
deemed sufficient, the House of Commons prosecutes the individual before the
House of Lords.119
While impeachment was availed for "high crimes and misdemeanors", it would
appear that the phrase was applied to variety of acts which can arguably amount
to breach of the public's confidence, such as advising the King to grant liberties
and privileges to certain persons to the hindrance of the due execution of the laws,
procuring offices for persons who were unfit, and unworthy of them and
squandering away the public treasure, browbeating witnesses and commenting on
their credibility, cursing and drinking to excess, thereby bringing the highest
scandal on the public justice of the kingdom, and failure to conduct himself on the
most distinguished principles of good faith, equity, moderation, and mildness. 120
While heavily influenced by the British concept of impeachment, the United States
of America made significant modifications from its British counterpart.
Fundamentally, the framers of the United States visualized the process as means
to hold accountable its public officials, as can be gleaned from their basic law:
The President, Vice-President, and all civil Officers of the United States, shall be
removed from Office on Impeachment for, and Conviction of, treason, Bribery, or
other High Crimes and Misdemeanors.121
Other noted differences from the British process of impeachment include limiting
and specifying the grounds to "treason, Bribery, or other High Criines and
Misdemeanors", and punishing the offender with removal and disqualification to
hold public office instead of death, forfeiture of property and corruption of blood. 122
In the Philippines, the earliest record of impeachment in our laws is from the 1935
Constitution.123 Compared to the US Constitution, it would appear that the drafters
of the 1935 Constitution further modified the process by making impeachment
applicable only to the highest officials of the country; providing "culpable violation
of the Constitution" as an additional ground, and requiring two-thirds vote of the
House of Representatives to impeach and three-fourths vote of the Senate to
convict.
As currently worded, our 1987 Constitution, in addition to those stated in the 1935
basic law, provided another additional ground to impeach highranking public
officials: "betrayal of public trust". Commissioner Rustico De los Reyes of the 1986
Constitutional Commission explained this ground as "catch-all phrase to include all
acts which are not punishable by statutes as penal offenses but, nonetheless,
render the officer unfit to continue in office. It includes betrayal of public interest,
inexcusable negligence of duty, tyrannical abuse of power, breach of official duty
by malfeasance or misfeasance, cronyism, favoritism, etc. to the prejudice of
public interest and which tend to bring the office into disrepute."124
From the foregoing, it is apparent that although the concept of impeachment has
undergone various modifications to suit different jurisdictions and government
forms, the consensus seems to be that it is essentially political process meant to
vindicate the violation of the public's trust. Buckner Melton, in his book The First
Impeachment: The Constitutions Framers and the Case of Senator William Blount,
succintly opined:
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Practically all who have written on the subject agree that impeachment involves
protection of public interest, incorporating public law element, much like criminal
proceeding....[I]mpeachment is process instigated by the government, or some
branch thereof, against person who has somehow harmed the government or the
community. The process, moreover, is adversarial in nature and resembles, to that
extent, judicial trial.125
Quo warranto
The oft-cited origin of quo warranto was the reign of King Edward of England who
questioned the local barons and lords who held lands or title under questionable
authority. After his return from his crusade in Palestine, he discovered that
England had fallen because of ineffective central administration by his
predecessor, King Henry III.126 The inevitable result was that the barons, whose
relations with the King were governed on paper by Magna Carta, assumed to
themselves whatever power the King's officers had neglected. Thus, King Edward
deemed it wise to inquire as to what right the barons exercised any power that
deviated in the slightest from normal type of feudalism that the King had in mind.
The theory is that certain rights are regalia and can be exercised only upon
showing of actual grants from the King or his predecessor. Verily, King Edward's
purpose was to catalogue the rights, properties and possessions of the kingdom in
his efforts to restore the same.
In the Philippines, the remedies against usurpers of public office appeared in the
1900s, through Act No. 190.127 Section 197 of the Act provides for provision
comparable to Section 1, Rule 66 of the Rules of Court:
Sec. 197. Usurpation of an Office or Franchise A civil action may be brought in the
name of the Government of the Philippine Islands:
1. Against person who usurps, intrudes into, or unlawfully holds or
exercises public civil office or franchise within the Philippine
Islands, or an office in corporation created by the authority of the
Government of the Philippine Islands;
2. Against public civil officer who does or suffers an act which, by the
provisions of law, works forfeiture of his office;
3. Against an association of persons who act as corporation within
the Philippine Islands, without being legally incorporated or without
lawful authority so to act.
Based from the foregoing, it appears that impeachment is proceeding exercised by
the legislative, as representatives of the sovereign, to vindicate the breach of the
trust reposed by the people in the hands of the public officer by determining the
public officer's fitness to stay in the office. Meanwhile, an action for quo warranto,
involves judicial determination of the eligibility or validity of the election or
appointment of public official based on predetermined rules.
Quo warranto and impeachment can proceed independently and
simultaneously
Aside from the difference in their origin and nature, quo warranto and
impeachment may proceed independently of each other as these remedies are
distinct as to (1) jurisdiction (2) grounds, (3) applicable rules pertaining to initiation,
filing and dismissal, and (4) limitations.
The term "quo warranto" is Latin for "by what authority."128 Therefore, as the name
suggests, quo warranto is writ of inquiry.129 It detennines whether an individual has
the legal right to hold the public office he or she occupies.130
In review, Section 1, Rule 66 of the Rules of Court provides:
Action by Government against individuals. An action for the usurpation of public
office, position or franchise may be commenced by verified petition brought in the
name of the Republic of the Philippines against:
(a) person who usurps, intrudes into, or unlawfully holds or exercises public office,
position or franchise;
(b) public officer who does or suffers an act which, by the provision of law,
constitutes ground for the forfeiture of his office; or
(c) An association which acts as corporation within the Philippines without being
legally incorporated or without lawful authority so to act.
Thus, quo warranto proceeding is the proper legal remedy to determine the right or
title to the contested public office or to oust the holder from its enjoyment. In quo
warranto proceedings referring to offices filled by election, what is to be
determined is the eligibility of the candidates elected, while in quo
warranto proceedings referring to offices filled by appointment, what is determined
is the legality of the appointment.
The title to public office may not be contested collaterally but only directly, by quo
warranto proceedings. In the past, the Court held that title to public office cannot
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be assailed even through mandamus or motion to annul or set aside
order.131 That quo warranto is the proper legal vehicle to directly attack title to
public office likewise precludes the filing of petition for prohibition for purposes of
inquiring into the validity of the appointment of public officer. Thus, in Nacionalista
Party v. De Vera,132 the Court held:
"[T]he writ of prohibition, even when directed against persons acting as judges or
other judicial officers, cannot be treated as substitute for quo warranto or be
rightfully called upon to perform any of the functions of the writ. If there is court,
judge or officer de facto, the title to the office and the right to act cannot be
questioned by prohibition. If an intruder takes possession of judicial office, the
person dispossessed cannot obtain relief through writ of prohibition commanding
the alleged intruder to cease from performing judicial acts, since in its very nature
prohibition is an improper remedy by which to determine the title to an office."133
As earlier discussed, an action for quo warranto may be commenced by the
Solicitor General or public prosecutor, or by any person claiming to be entitled to
the public office or position usurped or unlawfully held or exercised by another. 134
That usurpation of public office is treated as public wrong and carries with it public
interest in our jurisdiction is clear when Section 1, Rule 66 provides that where the
action is for the usurpation of public office, position or franchise, it shall be
commenced by verified petition brought in the name of the Republic of the
Philippines through the Solicitor General or public prosecutor.135
Nonetheless, the Solicitor General, in the exercise of sound discretion, may
suspend or turn down the institution of an action for quo warranto where there are
just and valid reasons. Upon receipt of case certified to him, the Solicitor General
may start the prosecution of the case by filing the appropriate action in court or he
may choose not to file the case at all. The Solicitor General is given permissible
latitude within his legal authority in actions for quo warranto, circumscribed only by
the national interest and the government policy on the matter at hand.136
The instance when an individual is allowed to commence an action for quo
warranto in his own name is when such person is claiming to be entitled to public
office or position usurped or unlawfully held or exercised by another.137Feliciano v.
Villasin138 reiterates the basic principle enunciated in Acosta v. Flor139that for quo
warranto petition to be successful, the private person suing must show no less
than clear right to the contested office.
In case of usurpation of public office, when the respondent is found guilty of
usurping, intruding into, or unlawfully holding or exercising public office, position or
franchise, the judgment shall include the following:
(a) the respondent shall be ousted and excluded from the office;
(b) the petitioner or relator, as the case may be, shall recover his costs; and
(c) such further judgment determining the respective rights in and to the public
office, position or franchise of all the parties to the action as justice requires.140
The remedies available in quo warranto judgment do not include correction or
reversal of acts taken under the ostensible authority of an office or franchise.
Judgment is limited to ouster or forfeiture and may not be imposed retroactively
upon prior exercise of official or corporate duties.141
Quo warranto and impeachment are, thus, not mutually exclusive remedies and
may even proceed simultaneously. The existence of other remedies against the
usurper does not prevent the State from commencing quo warranto proceeding.142
Respondent's Reply/Supplement to the Memorandum Ad Cautelam specifically
tackled the objection to the petition on the ground of forum shopping: Essentially,
respondent points out that the inclusion of the matter on tax fraud, which will
further be discussed below, is already covered by Article of the Articles of
Impeachment. Hence, respondent argues, among others, that the petition should
be dismissed on the ground of forum shopping.
Forum shopping is the act of litigant who repetitively availed of several judicial
remedies in different courts, simultaneously or successively, all substantially
founded on the same transactions and the same essential facts and
circumstances, and all raising substantially the same issues, either pending in or
already resolved adversely by some other court, to increase his chances of
obtaining favorable decision if not in one court, then in another. 143 Forum shopping
originated as concept in private international law, where non-resident litigants are
given the option to choose the forum or place wherein to bring their suit for various
reasons or excuses, including to secure procedural advantages, to annoy and
harass the defendant, to avoid overcrowded dockets, or to select more friendly
venue.144 At present, our jurisdiction has recognized several ways to commit forum
shopping, to wit: (1) filing multiple cases based on the same cause of action and
with the same prayer, the previous case not having been resolved yet (where the
ground for dismissal is litis pendentia); (2) filing multiple cases based on the same
cause of action and the same prayer, the previous case having been finally
resolved (where the ground for dismissal is res judicata); and (3) filing multiple
cases based on the same cause of action but with different prayers (splitting of
causes of action, where the ground for dismissal is also either litis pendentia or res
judicata).145
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We have already settled that the test for determining existence of forum shopping
is as follows:
To determine whether party violated the rule against forum shopping, the most
important factor to ask is whether the elements of litis pendentia are present, or
whether final judgment in one case will amount to res judicata in another;
otherwise stated, the test for determining forum shopping is whether in the two
(or more) cases pending, there is identity of parties, rights or causes of
action, and reliefs sought.146 (Emphasis ours)
Litis pendentia is Latin term, which literally means "a pending suit" and is variously
referred to in some decisions as lis pendens and auter action pendant. As ground
for the dismissal of civil action, it refers to the situation where two actions are
pending between the same parties for the same cause of action, so that one of
them becomes unnecessary and vexatious. It is based on the policy against
multiplicity of suits. Litis pendentia requires the concurrence of the following
requisites: (1) identity of parties, or at least such parties as those representing the
same interests in both actions; (2) identity of rights asserted and reliefs prayed for,
the reliefs being founded on the same facts; and (3) identity with respect to the two
preceding particulars in the two cases, such that any judgment that may be
rendered in the pending case, regardless of which party is successful, would
amount to res judicata in the other case.147
On the other hand, res judicata or prior judgment bars subsequent case when the
following requisites are satisfied: (1) the former judgment is final; (2) it is rendered
by court having jurisdiction over the subject matter and the parties; (3) it is
judgment or an order on the merits; (4) there is between the first and the second
actions identity of parties, of subject matter, and of causes of action.148
Ultimately, what is critical is the vexation brought upon the courts and the litigants
by party who asks different courts to rule on the same or related causes and grant
the same or substantially the same reliefs and in the process creates the possibility
of conflicting decisions being rendered by the different fora upon the same
issues.149
Guided by the foregoing, there can be no forum shopping in this case despite the
pendency of the impeachment proceedings before the House of Representatives,
contrary to respondent's position.
The causes of action in the two proceedings are unequivocally different. In quo
warranto, the cause of action lies on the usurping, intruding, or unlawfully holding
or exercising of public office, while in impeachment, it is the commission of an
impeachable offense. Stated in different manner, the crux of the controversy in
this quo warranto proceedings is the determination of whether or not respondent
legally holds the Chief Justice position to be considered as an impeachable officer
in the first place. On the other hand, impeachment is for respondent's prosecution
for certain impeachable offenses. To be sure, respondent is not being prosecuted
herein for such impeachable offenses enumerated in the Articles of Impeachment.
Instead, the resolution of this case shall be based on established facts and related
laws. Simply put, while respondent's title to hold public office is the issue in quo
warranto proceedings, impeachment necessarily presupposes that respondent
legally holds the public office and thus, is an impeachable officer, the only issue
being whether or not she committed impeachable offenses to warrant her removal
from office.
Likewise, the reliefs sought in the two proceedings are different. Under the Rules
on quo warranto, "when the respondent is found guilty of usurping, intruding into,
or unlawfully holding or exercising public office, x x x, judgment shall be rendered
that such respondent be ousted and altogether excluded therefrom, x x x."150 In
short, respondent in quo warranto proceeding shall be adjudged to cease from
holding public office, which he/she is ineligible to hold. On the other hand, in
impeachment, conviction for the charges of impeachable offenses shall result to
the removal of the respondent from the public office that he/she is legally
holding.151 It is not legally possible to impeach or remove person from an office
that he/she, in the first place, does not and cannot legally hold or occupy.
In the said Reply/Supplement to the Memorandum Ad Cautelam, respondent
advanced the argument that the "impeachment proceeding" is different from the
"impeachment case", the former refers to the filing of the complaint before the
Committee on Justice while the latter refers to the proceedings before the Senate.
Citing Francisco v. House of Representatives, respondent posits that the
"impeachment proceeding" against her is already pending upon the filing of the
verified complaint before the House Committee on Justice albeit the "impeachment
case" has not yet started as the Articles of Impeachment has not yet been filed
with the Senate. Hence, in view of such proceeding before the Committee on
Justice, the filing of the instant petition constitutes forum shopping.
The difference between the "impeachment proceeding" and the "impeachment
case" correctly cited by the respondent, bolsters the conclusion that there can be
no forum shopping. Indeed, the "impeachment proceeding" before the House
Committee on Justice is not the "impeachment case" proper. The impeachment
case is yet to be initiated by the filing of the Articles of Impeachment before the
Senate. Thus, at the moment, there is no pending impeachment case against the
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respondent.
The House Committee on Justice's determination of probable cause on whether
the impeachment against the respondent should go on trial before the Senate is
akin to the prosecutor's determination of probable cause during
the preliminary investigation in criminal case. In preliminary investigation, the
prosecutor does not determine the guilt or innocence of the accused; he does not
exercise adjudication nor rule-making functions. The process is merely inquisitorial
and is merely means of discovering if person may be reasonably charged with
crime. It is not trial of the case on the merits and has no purpose except that of
determining whether crime has been committed and whether there is probable
cause to believe that the accused is guilty thereof.152 As such, during the
preliminary investigation before the prosecutor, there is no pending case to speak
of yet. In fact, jurisprudence states that the preliminary investigation stage is not
part of the trial.153
Thus, at the time of the filing of this petition, there is no pending impeachment
case that would bar the quo warrranto petition on the ground of forum shopping.
In fine, forum shopping and litis pendentia are not present and final decision in one
will not strictly constitute as res judicata to the other. judgment in quo
warranto case determines the respondent's constitutional or legal authority to
perform any act in, or exercise any function of the office to which he lays
claim;154 meanwhile judgment in an impeachment proceeding pertain to
respondent's "fitness for public office."155
Considering the legal basis and nature of an action for quo waranto, this Court
cannot shirk from resolving the instant controversy in view of the fact that
respondent is an impeachable officer and/or in view of the possibility of an
impeachment trial against respondent.
Impeachment is not an exclusive remedy by which an invalidly appointed or
invalidly elected impeachable official may be removed from office
Respondent anchors her position that she can be removed from office only by
impeachment on the Court's ruling in Lecaroz v. Sandiganbayan,156Cuenco v.
Fernan,157 In Re Gonzales,158Jarque v. Desierto159 and Marcoleta v. Borra.160 It
should be stressed, however, that none of these cases concerned the validity of an
impeachable officer's appointment. Lecaroz involved criminal charge against
mayor before the Sandiganbayan, while the rest were disbarment cases filed
against impeachable officers principally for acts done during their tenure in public
office. Whether the impeachable officer unlawfully held his office or whether his
appointment was void was not an issue raised before the Court. The principle laid
down in said cases is to the effect that during their incumbency, impeachable
officers cannot be criminally prosecuted for an offense that carries with it the
penalty of removal, and if they are required to be members of the Philippine Bar to
qualify for their positions, they cannot be charged with disbarment. The
proscription does not extend to actions assailing the public officer's title or right to
the office he or she occupies. The ruling therefore cannot serve as authority to
hold that quo warranto action can never be filed against an impeachable officer. In
issuing such pronouncement, the Court is presumed to have been aware of its
power to issue writs of quo warrantounder Rule 66 of the Rules of Court.
Even the PET Rules expressly provide for the remedy of either an election protest
or petition for quo warranto to question the eligibility of the President and the Vice-
President, both of whom are impeachable officers. Following respondent's theory
that an impeachable officer can be removed only through impeachment means
that President or Vice-President against whom an election protest has been filed
can demand for the dismissal of the protest on the ground that it can potentially
cause his/her removal from office through mode other than by impeachment. To
sustain respondent's position is to render election protests under the PET Rules
nugatory. The Constitution could not have intended such absurdity since fraud and
irregularities in elections cannot be countenanced, and the will of the people as
reflected in their votes must be determined and respected. The Court could not,
therefore, have unwittingly curtailed its own judicial power by prohibiting quo
warranto proceedings against impeachable officers.
Further, the PET Rules provide that petition for quo warranto, contesting the
election of the President or Vice-President on the ground of ineligibility or disloyalty
to the Republic of the Philippines, may be filed by any registered voter who has
voted in the election concerned within ten (10) days after the proclamation of the
winner.161 Despite disloyalty to the Republic being crime against public
order162 defined and penalized under the penal code, and thus may likewise be
treated as "other high crimes,"163 constituting an impeachable offense, quo
warranto as remedy to remove the erring President or Vice-President is
nevertheless made expressly available.
In fact, this would not be the first time the Court shall take cognizance of quo
warranto petition against an impeachable officer. In the consolidated cases
of Estrada v. Desierto, et al. and Estrada v. MacapagalArroyo,164 the Court took
cognizance and assumed jurisdiction over the quo warranto petition filed against
respondent therein who, at the time of the filing of the petition, had taken an oath
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and assumed the Office of the President. Petitioner therein prayed for judgment
confinning him to be the lawful and incumbent President of the Republic
temporarily unable to discharge the duties of his office, and declaring respondent
to have taken her oath and to be holding the Office of the President, only in an
acting capacity. In fact, in the said cases, there was not even claim that
respondent therein was disqualified from holding office and accordingly
challenged respondent's status as de jure 14th President of the Republic. By
entertaining the quo warranto petition, the Court in fact determined whether then
President Estrada has put an end to his official status by his alleged act of
resignation.
Furthermore, the language of Section 2, Article XI of the Constitution does not
foreclose quo warranto action against impeachable officers. The provision reads:
Section 2. The President, the Vice-President, the Members of the Supreme Court,
the Members of the Constitutional Commissions, and the Ombudsman may be
removed from office on impeachment for, and conviction of, culpable violation of
the Constitution, treason, bribery, graft and corruption, other high crimes, or
betrayal of public trust. All other public officers and employees may be removed
from office as provided by law, but not by impeachment. (Emphasis ours)
It is settled rule of legal hermeneutics that if the language under consideration is
plain, it is neither necessary nor permissible to resort to extrinsic aids, like the
records of the constitutional convention, for its interpretation.165
The provision uses the permissive term "may" which, in statutory construction,
denotes discretion and cannot be construed as having mandatory effect.166We
have consistently held that the term "may" is indicative of mere possibility, an
opportunity or an option. The grantee of that opportunity is vested with right or
faculty which he has the option to exercise.167 An option to remove by
impeachment admits of an alternative mode of effecting the removal.
On this score, Burke Shartel in his work Federal Judges: Appointment,
Supervision, and Removal: Some Possibilities under the Constitution,168 makes an
interesting and valid observation on parallel provision on impeachment under the
U.S. Constitution from which ours was heavily patterned:
x x x it is not reasonable to spell out of the express provisiOn for impeachment, an
intention or purpose of the framers to create an exclusive remedy. The common
canon for interpreting legislation, expresio unius excusio est alterius has no proper
application to an express provision for one of several common-law remedies. The
express provision for removal by impeachment ought not to be taken as tacit
prohibition of removal by other methods when there are other adequate reasons to
account for this express provision. The main purpose of the framers of the
Constitution in providing for impeachment was to supply legislative check on the
other departments of our government, and particularly on the chief executive.
Without an express provision, impeachment would have been impliedly prohibited
by the doctrine of separation of powers. If this legislative check was desired,
reservation in express words was essential. Another reason for the express
provisions on this subject was that the framers of the Constitution did not wish to
make the executive and judicial officers of our government completely dependent
on Congress. They wanted to confer only limited power of removal, and the
desired limitations on the power to impeach had to be explicitly stated. These two
reasons explain the presence in the Constitution of the express provisions for
impeachment; it is not necessary to resort to any supposed intent to establish an
exclusive method of removal in order to account for them. On the contrary, logic
and sound policy demand that the Congressional power be construed to be
concurrent, not an exclusive, power of removal.
We hold, therefore, that by its tenor, Section 2, Article XI of the Constitution allows
the institution of quo warranto action against an impeachable officer. After all, quo
warranto petition is predicated on grounds distinct from those of impeachment. The
former questions the validity of public officer's appointment while the latter indicts
him for the so-called impeachable offenses without questioning his title to the office
he holds.
Further, that the enumeration of "impeachable offenses" is made absolute, that is,
only those enumerated offenses are treated as grounds for impeachment, is not
equivalent to saying that the enumeration likewise purport to be complete
statement of the causes of removal from office. Shartel, above cited, eloquently
incites as follows:
x x x. There is no indication in the debates of the Convention that the framers of
the Constitution intended at this point to make complete statement of causes of
removal from office. The emphasis was on the causes for which Congress might
remove executive and judicial officers, not on causes of removal as such. x x x
How then can the causes of removal by impeachment be construed as recital of
the causes for which judges may be removed? It is especially hard to see why the
express provision for impeachment limited legislative method of removing all civil
officers for serious misconduct should be construed to forbid removal of judges by
judicial action on account of disability or any reasonable cause not proper ground
for action by the Houses of Congress.
Neither can the Court accept respondent's argument that the term "may" in Section
2, Article XI qualifies only the penalty imposable at the conclusion of the
impeachment trial, such that conviction may result in lesser penalties like censure
or reprimand. Section 3(7), Article XI of the Constitution specifies the penalty of
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"removal from office" and "disqualification to hold any office under the Republic of
the Philippines" in impeachment cases.169 There is nothing in the said provision
that deliberately vests authority on the impeachment court to impose penalties
lower than those expressly mentioned. Also, respondent has not shown that such
was authority was intended by the framers of the 1987 Constitution. The ultimate
penalty of removal is imposed owing to the serious nature of the impeachable
offenses. This Court had occasion to rule:
The task of the Court is rendered lighter by the existence of relatively clear
provisions in the Constitution. In cases like this, we follow what the Court, speaking
through Mr. Justice (later, Chief Justice) Jose Abad Santos stated in Gold Creek
Mining Corp. v. Rodriguez, that:
The fundamental principle of constitutional construction is to give effect to the
intent of the framers of the organic law and of the people adopting it. The
intention to which force is to be given is that which is embodied and
expressed in the constitutional provisions themselves.170 (Emphasis supplied)
To subscribe to the view that appointments or election of impeachable officers are
outside judicial review is to cleanse their appointments or election of any possible
defect pertaining to the Constitutionally-prescribed qualifications which cannot
otherwise be raised in an impeachment proceeding.
The courts should be able to inquire into the validity of appointments even of
impeachable officers. To hold otherwise is to allow an absurd situation where the
appointment of an impeachable officer cannot be questioned even when, for
instance, he or she has been determined to be of foreign nationality or, in offices
where Bar membership is qualification, when he or she fraudulently represented to
be member of the Bar. Unless such an officer commits any of the grounds for
impeachment and is actually impeached, he can continue discharging the
functions of his office even when he is clearly disqualified from holding it Such
would result in permitting unqualified and ineligible public officials to continue
occupying key positions, exercising sensitive sovereign functions until they are
successfully removed from office through impeachment. This could not have been
the intent of the framers of the Constitution.
We must always put in mind that public office is public trust.171 Thus, the people
have the right to have only qualified individuals appointed to public' office. To
construe Section 2, Article XI of the Constitution as proscribing quo
warranto petition is to deprive the State of remedy to correct "public wrong" arising
from defective or void appointments. Equity will not suffer wrong to be without
remedy. Ubi jus ibi remedium. Where there is right, there must be remedy.172
As respondent herself previously opined in one case: "Reason is the foundation of
all legal interpretation, including that of constitutional interpretation. And the most
powerful tool of reason is reflecting on the essence of things."173
The essence of quo warranto is to protect the body politic from the usurpation of
public office and to ensure that government authority is entrusted only to qualified
individuals. Reason therefore dictates that quo warranto should be an available
remedy to question the legality of appointments especially of impeachable officers
considering that they occupy some of the highest-ranking offices in the land and
are capable of wielding vast power and influence on matters of law and policy.
At this juncture, it would be apt to dissuade and allay the fear that ruling on the
availability of quo warranto would allow the Solicitor General to "wield sword over
our collective heads, over all our individual heads, and on that basis, impair the
integrity of the Couas court."174
Such view, while not improbable, betrays fallacious and cynical view of the
competence and professionalism of the Solicitor General and the members, of this
Court. It presupposes that members of this Court are law offenders. It also
proceeds from the premise that the Solicitor General is the Executive's pawn in its
perceived quest for "more friendly" Court. Verily, fear, particularly if unfounded,
should not override settled presumptions of good faith and regularity in the
performance of official duties. This Court, absent compelling proof to the contrary,
has no basis to doubt the independence and autonomy of the Solicitor
General.175 It is worthwhile to note that while the Solicitor General has prerogative
in the institution of an action for quo warranto, its exercise of such discretion is
nevertheless subject to the Court's review. In Topacio v. Ong,176 this Court
explained:
In the exercise of sound discretion, the Solicitor General may suspend or turn
down the institution of an action for quo warranto where there are just and valid
reasons. Thus, in Gonzales v. Chavez, the Court ruled:
Like the Attorney-General of the United States who has absolute discretion in
choosing whether to prosecute or not to prosecute or to abandon prosecution
already started, our own Solicitor General may even dismiss, abandon, discontinue
or compromise suits either with or without stipulation with the other
party. Abandonment of case, however, does not mean that the Solicitor
General may just drop it without any legal and valid reasons, for the
discretion given him is not unlimited. Its exercise must be, not only within the
parameters set by law but with the best interest of the State as the ultimate goal.
Upon receipt of case certified to him, the Solicitor General exercises his discretion
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in the management of the case. He may start the prosecution of the case by filing
the appropriate action in court or he may opt not to file the case at all. He may do
everything within his legal authority but always conformably with the national
interest and the policy of the government on the matter at hand. (Emphasis
ours)
Neither should it be forgotten that the Solicitor General is an officer of the Court,
tasked "to share in the task and responsibility of dispensing justice and resolving
disputes;" therefore, he may be enjoined in the same manner that special
prosecutor was sought enjoined by this Court from committing any act which may
tend to "obstruct, pervert or impede and degrade the administration of
justice."177 Either way, in the event that quo warranto cases against members of
the Judiciary inundate the courts' dockets, it does not follow that the courts are
powerless to shield its members against suits which are obviously lacking in merit,
or those merely intended to harass the respondent.
The Supreme Court's exercise of its jurisdiction over quo warranto petition is
not violative of the doctrine of separation of powers
Section 3(1) and 3(6), Article XI, of the Constitution respectively provides that the
House of Representatives shall have the exclusive power to initiate all cases of
impeachment while the Senate shall have the sole power to try and decide all
cases of impeachment. Thus, there is no argument that the constitutionally-defined
instrumentality which is given the power to try impeachment cases is the Senate.
Nevertheless, the Court's assumption of jurisdiction over an action for quo
warranto involving person who would otherwise be an impeachable official had it
not been for disqualification, is not violative of the core constitutional provision that
impeachment cases shall be exclusively tried and decided by the Senate.
Again, an action for quo warranto tests the right of person to occupy public
position. It is direct proceeding assailing the title to public office.178 The issue to be
resolved by the Court is whether or not the defendant is legally occupying public
position which goes into the questions of whether defendant was legally appointed,
was legally qualified and has complete legal title to the office. If defendant is found
to be not qualified and without any authority, the relief that the Court grants is the
ouster and exclusion of the defendant from office.179 In other words, while
impeachment concerns actions that make the officer unfit to continue exercising
his or her office, quo warranto involves matters that render him or her ineligible to
hold the position to begin with.
Given the nature and effect of an action for quo warranto, such remedy is
unavailing to determine whether or not an official has committed misconduct in
office nor is it the proper legal vehicle to evaluate the person's performance in the
office. Apropos, an action for quo warranto does not try person's culpability of an
impeachment offense, neither does writ of quo warranto conclusively pronounce
such culpability.
In Divinagracia v. Consolidated Broadcasting System, Inc.,180 the Court further
explained the court's authority to issue writ of quo warranto, as complementary to,
and not violative of, the doctrine of separation of powers, as follows:
And the role of the courts, through quo warranto proceedings, neatly
complements the traditional separation of powers that come to bear in our
analysis. The courts are entrusted with the adjudication of the legal status of
persons, the final arbiter of their rights and obligations under law. The
question of whether franchisee is in breach of the franchise specially
enacted for it by Congress is one inherently suited to court of law, and not
for an administrative agency, much less one to which no such function has
been delegated by Congress. In the same way that availability of judicial review
over laws does not preclude Congress from undertaking its own remedial
measures by appropriately amending laws, the viability of quo warranto in the
instant cases does not preclude Congress from enforcing its own
prerogative by abrogating the legislative franchises of respondents should it
be distressed enough by the franchisees' violation of the franchises
extended to them. (Emphasis ours)
Applying the ratio in Divinagracia, the Court's exercise of its jurisdiction over quo
warranto proceedings does not preclude Congress from enforcing its own
prerogative of determining probable cause for impeachment, to craft and transmit
the Articles of Impeachment, nor will it preclude Senate from exercising its
constitutionally committed power of impeachment.
Indeed, respondent's case is peculiar in that her omission to file her SALN also
formed part of the allegations against her in the Verified Complaint for
Impeachment. Verily, the filing of the SALN is Constituional requirement, and the
transgression of which may, in the wisdom of the impeachment court, be
interpreted as constituting culpable violation of the Constitution. But then,
respondent, unlike the President, the Vice-President, Members of the
Constitutional Commissions, and the Ombudsman, apart from having to comply
with the Constitutional SALN requirement, also answers to the unique
Constitutional qualification of having to be person of proven competence, integrity,
probity, and independence-qualifications not expressly required by the
fundamental law for the other impeachable officers.181 And as will be extensively
demonstrated hereunder, respondent's failure to file her SALNs and to submit the
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same to the JBC go into the very qualification of integrity. In other words, when
Member of the Supreme Court transgresses the SALN requirement prior to his or
her appointment as such, he or she commits violation of the Constitution and
belies his or her qualification to hold the office. It is not therefore accurate to place
Members of the Supreme Court, such as, respondent, on absolutely equal plane
as that of the other impeachable officers, when more stringent and burdensome
requirements for qualification and holding of office are expressly placed upon
them.
In the same vein, the fact that the violation of the SALN requirement formed part of
the impeachment complaint does not justify shifting responsibility to the Congress,
no matter how noble the respondent and the intervenors portray such act to be.
The fact remains that the Republic raised an issue as to respondent's eligibility to
occupy the position of Chief Justice, an obviously legal question, which can be
resolved through review of jurisprudence and pertinent laws. Logic, common
sense, reason, practicality and even principles of plain arithmetic bear out the
conclusion that an unqualified public official should be removed from the position
immediately if indeed Constitutional and legal requirements were not met or
breached. To abdicate from resolving legal controversy simply because of
perceived availability of another remedy, in this case impeachment, would be to
sanction the initiation of process specifically intended to be long and arduous and
compel the entire membership of the Legislative branch to momentarily abandon
their legislative duties to focus on impeachment proceedings for the possible
removal of public official, who at the outset, may clearly be unqualified under
existing laws and case law. Evidently, this scenario would involve waste of time,
not to mention unnecessary disbursement of public funds.
Further, as an impeachment court, the Senate is tribunal composed of politicians
who are indubitably versed in pragmatic decision making and cognizant of political
repercussions of acts purported to have been committed by impeachable
officials.182 As representatives of the Filipino people, they determine whether the
purported acts of highest ranking officials of the country constitute as an offense to
the citizenry. Following this premise, the impeachment tribunal cannot be expected
to rule on the validity or constitutionality of the Chief Justice's appointment, nor can
their ruling be of jurisprudential binding effect to this Court. To authorize Congress.
to rule on public officials' eligibility would disturb the system of checks and
balances as it would dilute the judicial power of courts, upon which jurisdiction is
exclusively vested to rule on actions for quo warranto.
Nevertheless, for the guidance of the bench and the bar, and to obliviate confusion
in the future as to when quo warranto as remedy to oust an ineligible public official
may be availed of, and in keeping with the Court's function of harmonizing the laws
and the rules with the Constitution, the Court herein demarcates that an act or
omission committed prior to or at the time of appointment or election relating to an
official's qualifications to hold office as to render such appointment or election
invalid is properly the subject of quo warranto petition, provided that the requisites
for the commencement thereof are present. Contrariwise, acts or omissions, even
if it relates to the qualification of integrity, being continuing requirement but
nonetheless committed during the incumbency of validly appointed and/or validly
elected official, cannot be the subject of quo warranto proceeding, but of
something else, which may either be impeachment if the public official concerned
is impeachable and the act or omission constitutes an impeachable offense, or
disciplinary, administrative or criminal action, if otherwise.
Judicial power versus Judicial restraint and fear of constitutional crisis
Judicial power is vested in one Supreme Court and in such lower courts as may be
established by law. Judicial power includes the duty of the courts of justice to settle
actual controversies involving rights which are legally demandable and
enforceable, and to determine whether or not there has been grave abuse of
discretion amounting to lack or excess of jurisdiction on the part of any branch or
instrumentality of the Govemment.183
In the presence of all the requisites184 for the Court's exercise of judicial review,
there can be no doubt that the exercise thereof is not discretionary upon the Court,
nor dependent upon the whims and caprices of any of its Members nor any of the
parties. Even in cases rendered moot and academic by supervening events, the
Court nevertheless exercised its power of review on the basis of certain
recognized exceptions.185 Neither is its exercise circumscribed by fear of
displeasing co-equal branch of the government. Instead, the Constitution makes it
crystal clear that the exercise of judicial power is duty of the Court.
As such, the exercise of judicial power could never be made dependent upon the
action or inaction of another branch of the government. The exercise of judicial
restraint on the ground that the Senate, sitting as an impeachment court, has the
sole power to try and decide all cases of impeachment, is thus misplaced.
For one, at the time of the filing of, and even during the pendency of the resolution
of the instant petition, no impeachment trial has been commenced by the Senate.
In fact, it will be purely skeptical, nay lackadaisical, on the part of the Court to
assume, at the time the petition was filed, that the House of Representatives will
affirm favorable resolution with the Articles of Impeachment and that trial will
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eventually carry on.
For another, and as extensively discussed, the question of whether or not
respondent usurped public office is undoubtedly justiciable. Recall Francisco, Jr.,
v. House of Representatives:186
The exercise of judicial restraint over justiciable issues is not an option before this
Court. Adjudication may not be declined, because this Court is not legally
disqualified. Nor can jurisdiction be renounced as there is no other tribunal to
which the controversy may be referred. Otherwise, this Court would be shirking
from its duty vested under Art. VIII, Sec. 1(2) of the Constitution. More than being
clothed with authority thus, this Court is duty-bound to take cognizance of the
instant petitions. In the august words of amicus curiae Father Bernas, jurisdiction is
not just power; it is solemn duty which may not be renounced. To renounce it, even
if it is vexatious, would be dereliction of duty.
Thus, to exercise restraint in reviewing an impeachable officer's appointment is
clear renunciation of judicial duty. We have held that:
While an appointment is an essentially discretionary executive power, it is subject
to the limitation that the appointee should possess none of the disqualifications but
all the qualifications required by law. Where the law prescribes certain
qualifications for given office or position, courts may determine whether the
appointee has the requisite qualifications, absent which, his right or title
thereto may be declared void.187 (Emphasis ours)
Clearly, an outright dismissal of the petition based on speculation that respondent
will eventually be tried on impeachment is clear abdication of the Court's duty to
settle actual controversy squarely presented before it. Indeed, the easiest way to
lose power is to abdicate it.
Neither does the possibility of the occurrence of constitutional crisis reason for the
Court to abandon its positive constitutional duty to take cognizance of case over
which it enjoys jurisdiction and is not otherwise legally disqualified. constitutional
crisis may arise from conflict over the determination by the independent branches
of government of the nature, scope and extent of their respective constitutional
powers. Thus, there can be no constitutional crisis where the Constitution itself
provides the means and bases for the resolution of the "conflict." To reiterate, the
Court's exercise of jurisdiction over an action for quo warranto falls within the ambit
of its judicial power to settle justiciable issues or actual controversies involving
rights which are legally demandable and enforceable. In so doing, the Court is not
arrogating upon itself the Congress' power to determine whether an impeachable
officer may be removed by impeachment or not, which is political, rather than
judicial, exercise.188
In fine, it is settled that jurisdiction is conferred by law. It cannot be waived by
stipulation, by abdication or by estoppel. Quo warranto proceedings are essentially
judicial in character it calls for the exercise of the Supreme Court's constitutional
duty and power to decide cases and settle actual controversies. This constitutional
duty cannot be abdicated or transferred in favor of, or in deference to, any other
branch of the government including the Congress, even as it acts as an
impeachment court through the Senate. As an impeachment court, the Senate's
jurisdiction and the effect of its pronouncement is as limited under the Constitution
it cannot rule on the constitutionality of an appointment of Member of the Supreme
Court with jurisprudential binding effect because rulings of the impeachment court,
being political rather than judicial body, do not form part of the laws of the land.
Any attempt to derogate or usurp judicial power in the determination of whether the
respondent's appointment is constitutional or not will, in point of fact, amount to
culpable violation of the Constitution.
In the same breath, the Supreme Court cannot renege on its avowed constitutional
duty and abdicate its judicial power. To do so would similarly amount to culpable
violation of the Constitution. Instead, this Court asserts its judicial independence
and equanimity to decide cases without fear or favor; without regard as to party's
power or weakness; without regard to personalities; all to the ultimate end that Our
sacrosanct oaths as magistrates of this Court, which We voluntarily imposed upon
ourselves without any mental reservation or purpose of evasion, to support and
defend the Constitution and to obey the laws of the land, are strongly and faithfully
realized.
Seeking affirmative relief from the Court is tantamount to voluntary
appearance
In repudiating the Court's jurisdiction over her person and over the subject matter,
respondent harps on the fact that as Chief Justice, she is an impeachable officer
who may be removed only by impeachment by the Senate constituted as an
impeachment court. As extensively discussed, the Court maintains jurisdiction over
the present quo warranto proceedings despite respondent's occupation of an
impeachable office, as it is the legality or illegality of such occupation that is the
subject matter of the instant petition. Further, respondent cannot now be heard to
deny the Court's jurisdiction over her person even as she claims to be an
impeachable official because respondent in fact invoked and sought affirmative
relief from the Court by praying for the inhibition of several Members of this Court
and by moving that the case be heard on Oral Arguments, albeit ad cautelam.
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While mindful of Our ruling in La Naval Drug Corporation v. Court of
Appeals,189 which pronounced that party may file Motion to Dismiss on the ground
of lack of jurisdiction over its person, and at the same time raise affirmative
defenses and pray for affirmative relief without waiving its objection to the
acquisition of jurisdiction over its person, as well as Section 20, 190 Rule 15, this
Court, in several cases, ruled that seeking affirmative relief in court is tantamount
to voluntary appearance therein.191
Thus, in Philippine Commercial International Bank v. Dy Hong Pi,192 cited in NM
Rotchschild Sons (Australia) Limited v. Lepanto Consolidated Mining
Company,193 wherein defendants filed Motion for Inhibition without submitting
themselves to the jurisdiction of this Court, We held:
Besides, any lingering doubts on the issue of voluntary appearance dissipate when
the respondents' motion for inhibition is considered. This motion seeks sole relief:
inhibition of Judge Napoleon Inoturan from further hearing the case. Evidently, by
seeking affirmative relief other than dismissal of the case, respondents
manifested their voluntary submission to the court's jurisdiction. It is well-
settled that the active participation of party in the proceedings is tantamount to an
invocation of the court's jurisdiction and willingness to abide by the resolution of
the case, and will bar said party from later on impugning the court's jurisdiction.
(Emphasis in the original)
Accordingly, We rule that respondent, by seeking affirmative relief, is deemed to
have voluntarily submitted to the jurisdiction of the Court. Following settled
principles, respondent cannot invoke the Court's jurisdiction on one hand to secure
affirmative relief, and then repudiate that same jurisdiction after obtaining or failing
to obtain such relief.
II.
The Petition is Not Dismissible on the Ground of Prescription
Prescription does not lie against the State
The rules on quo warranto, specifically Section 11, Rule 66, provides:
Limitations. Nothing contained in this Rule shall be construed to authorize an
action against public officer or employee for his ouster from office unless the
same be commenced within one (1) year after the cause of such ouster, or
the right of the petitioner to hold such office or position, arose; nor to
authorize an action for damages in accordance with the provisions of the next
preceding section unless the same be commenced within one (1) year after the
entry of the judgment establishing the petitioner's right to the office in question.
(Emphasis supplied)
Since the 1960's the Court had explained in ample jurisprudence the application of
the one-year prescriptive period for filing an action for quo warranto.
In Bumanlag v. Fernandez and Sec. of Justice,194 the Court held that the one-year
period fixed in then Section 16, Rule 68 of the Rules of Court is condition
precedent to the existence of the cause of action for quo warranto and that the
inaction of an officer for one year could be validly considered waiver of his right to
file the same.
In Madrid v. Auditor General and Republic,195 We held that person claiming to
position in the civil service must institute the proper proceedings to assert his right
within the one-year period, otherwise, not only will he be considered to have
waived his right to bring action therefor but worse, he will be considered to have
acquiesced or consented to the very matter that he is questioning.
The Court explained in Madrid that the reason for setting prescriptive period is the
urgency of the matter to be resolved. The government must be immediately
informed or advised if any person claims to be entitled to an office or position in the
civil service, as against another actually holding it, so that the government may not
be faced with the predicament of having to pay two salaries, one for the person
actually holding the office although illegally, and another for one not actually
rendering service although entitled to do so.196
In Torres v. Quintos,197 the Court further explained that public interest requires that
the rights of public office should be determined as speedily as practicable. We
have also explained in Cristobal v. Melchor and Arcala198 that there are weighty
reasons of public policy and convenience that demand the adoption of such
limitation as there must be stability in the service so that public business may not
be unduly retarded.199
Distinctively, the petitioners in these cited cases were private individuals asserting
their right of office, unlike the instant case where no private individual claims title to
the Office of the Chief Justice. Instead, it is the government itself which
commenced the present petition for quo warranto and puts in issue the
qualification of the person holding the highest position in the Judiciary.
Thus, the question is whether the one-year limitation is equally applicable when
the petitioner is not mere private individual pursuing private interest, but the
government itself seeking relief for public wrong and suing for public interest? The
answer is no.
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Reference must necessarily be had to Section 2, Rule 66 which makes
it compulsory for the Solicitor General to commence quo warranto action:
SEC. 2. When Solicitor General or public prosecutor must commence action. The
Solicitor General or public prosecutor, when directed by the President of the
Philippines, or when upon complaint or otherwise he has good reason to believe
that any case specified in the preceding section can be established by
proof must commence such action. (Emphasis supplied)
In other words, when the Solicitor General himself commences the quo
warranto action either (1) upon the President's directive, (2) upon complaint or (3)
when the Solicitor General has good reason to believe that there is proof that (a)
person usurps, intrudes into, or unlawfully holds or exercises public office, position
or franchise; (b) public officer does or suffers an act which is ground for the
forfeiture of his office; or (c) an association acts as corporation without being
legally incorporated or without lawful authority so to act, he does so in the
discharge of his task and mandate to see to it that the best interest of the public
and the government are upheld. In these three instances, the Solicitor General is
mandated under the Rules to commence the necessary quo warranto petition.
That the present Rule 66 on quo warranto takes root from Act No. 160, which is
legislative act, does not give the one-year rule on prescription absolute
application. Agcaoili v. Suguitan,200 squarely addressed this non-absolute
character of the one-year prescriptive period as follows:
x x x in re prescription or limitation of the action, it may be said that originally there
was no limitation or prescription of action in an action for quo warranto, neither
could there be, for the reason that it was an action by the Government and
prescription could not be plead as defense to an action by the Government. The
ancient writ of quo warranto was high prerogative writ in the nature of writ of right
by the King against any one who usurped or claimed any office, franchise or liberty
of the crown, to inquire by what authority the usurper supported his claim, in order
to determine the right. Even at the present time in many of the civilized countries of
the world the action is still regarded as prerogative writ and no limitation or
prescription is permitted to bar the action. As general principle it may be stated
that ordinary statutes of limitation, civil or penal, have no application to quo
warranto proceeding brought to enforce public right.
xxxx
In our opinion, even granting that section 216 is applicable to the appellant, the
period of prescription had not begun to run at the time of the commencement of
the present action. He was justified in delaying the commencement of his
action until an answer to his protest had been made. He had right to await the
answer to his protest, in the confident belief that it would be resolved in his favor
and that action would be unnecessary.201 (Citations omitted and emphasis ours)
Continuing, Agcaoili cites People ex rel. Moloney v. Pullmans Palace Car Co.,202 to
emphasize that the State is not bound by statute of limitations nor by the laches,
acquiescence or unreasonable delay on the part of its officers:
It is conceded, the state, acting in its character as sovereign, is not bound by any
statute of limitations or technical estoppel. It is urged, however, that in quo
warranto, under the common-law rule, the courts, in the exercise of their discretion
to grant the writ or not, or upon final hearing, refused aid when the conditions
complained of had existed for number of years with knowledge on the part of the
sovereign, and that the provisions of 1 of chapter 112 of the Revised Statutes,
entitled Quo Warranto, that leave to file the information shall be given if the court
or judge to whom the petition is presented shall be satisfied there is probable
cause for the proceeding, leave the court still possessed of power to consider upon
the hearing, and then apply the same doctrine of waiver and acquiescence. It is
the general rule that laches, acquiescence, or unreasonable delay in the
performance of duty on the part of the officers of the state, is not imputable
to the state when acting in its character as sovereign. There are exceptions to
this general rule, but we are unable to see that the allegations of the plea bring the
case within the principles of any such exceptions.
Jurisprudence acros the United States likewise richly reflect that when the Solicitor
General files quo warranto petition in behalf of the people and where the interests
of the public is involved, the lapse of time presents no effective bar:
An information in the nature of quo warranto cannot be filed by private individual
without leave, which the court may, at its discretion, either grant or refuse. To
regulate their discretion as affected by the lapse of time, the English courts
adopted the rule which we have stated. But the Attorney General, representing
the Crown in England and the State in this country, may file an information in the
nature of quo warranto, without leave, according to his own discretion; and
we find no English law which holds that an information, so filed, can be barred by
the lapse of six years independently of any statute to that effect. x x x
The Attorney General being public officer, may be presumed to be capable of
salutary and reasonable discretion, as well as the court, and when, acting in behalf
of the State, he deems it his duty to prosecute for forfeiture, it is not for the court, in
the absence of any statutory limitation, to say he is too late. Indeed this court has
itself decided that, after the information has once been filed, its discretion ceases,
and it has then nothing to do but administer the law the same as in any other
case.203 (Citations omitted)
In People v. Bailey:204
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Appellant claims that the action is barred by the provisions of the statute of
limitations. x x x x We are of the opinion that the established rule of law, as to the
statute of limitations and its bearing upon cases of this character, is correctly
stated in the quotations above made and "that the attorney general may file the
information on behalf of the people at any time, and that lapse of time
constitutes no bar to the proceeding." The law, in thus permitting the attorney-
general, either upon his own information or upon the information of private party, to
file an information at any time against one who has unlawfully intruded into and is
holding public office, does not place the courts or private parties in much danger of
having to deal with stale claims. The action can only be brought with the
consent and permission of the attorney-general of the state, and, it is to be
assumed, he will not permit the institution of such suit, if by reason of great
lapse of time the claim has become stale, or for any other reason the state
has ceased to have present interest in it. (Citations omitted)
People v. Bailey quotes McPhail v. People ex rel. Lambert,205 as follows:
We do not consider this quo warranto proceeding, prosecuted by the state's
attorney, for the purpose of ousting one charged with wrongfully and without
authority of law exercising the office, jurisdiction and powers of police magistrate,
as simply civil remedy, for the protection of private rights only. Police magistrates
are public officers, that are provided for in the constitution of the state; and by that
instrument the judicial powers of the state are, in part, vested in them. The office of
police magistrate is one in which the state and the general public have deep
interest, and the jurisdiction attached to it is uniform with that belonging to the
office of justice of the peace. It is matter of public concern to the people of the
state, and against their peace and dignity, that any one should unlawfully, and
without authority of right, exercise the jurisdiction, powers and functions of such
office, and also matter of interest to the state and to the general public that more
persons than the law authorizes are acting as police magistrates. In this country
the rule is that the attorney general or state's attorney may file the information
in behalf of the people, where the interests of the general public are
involved, at any time, and that, in conformity with the maxim, 'Nullum tempus
occurrit regi,' lapse of time constitutes no bar to the proceeding. (Citations
omitted)
Aptly, in State ex rel Stovall v. Meneley,206 it was held that quo warranto action is
governmental function and not propriety function, and therefore the doctrine of
laches does not apply:
Governmental functions are those performed for the general public with respect to
the common welfare for which no compensation or particular benefit is received. x
x x Quo warranto proceedings seeking ouster of public official are
governmental function. (Citations and annotations omitted) No statute of
limitations is, therefore, applicable. The district court did not err in denying
Meneley's motion to dismiss based on the statute of limitations. x x x x
The doctrine of laches, furthermore, does not apply when cause of action is
brought by the State seeking to protect the public. (Citations and annotations
omitted) x x x Having already noted that the quo warranto action is governmental
function and not propriety function, we hold the district court did not err in denying
Meneley's motion to dismiss on the basis of laches.
In fact, liberal interpretation to quo warranto provisions is sanctioned given that its
primary purpose is to ascertain whether one is constitutionally authorized to hold
office. State ex rel Anaya v. McBride207 elucidates:
Since the Constitution provides for separate and equal branches of government in
New Mexico, any legislative measure which affects pleading, practice or procedure
in relation to power expressly vested by the Constitution in the judiciary, such
as quo warranto, cannot be deemed binding. We cannot render inoperative clause
in the Constitution on so slender reed. One of the primary purposes of quo
warranto is to ascertain whether one is constitutionally authorized to hold
the office he claims, whether by election or appointment, and we must
liberally interpret the quo warranto statutes to effectuate that purpose.
Indeed, when the government is the real party in interest, and is proceeding mainly
to assert its rights, there can be no defense on the ground of laches or
prescription.208 Indubitably, the basic principle that "prescription does not lie
against the State" which finds textual basis under Article 1108 (4)209 of the Civil
Code, applies in this case.
Circumstances obtaining in this case preclude the application of the
prescriptive period
That prescription does not lie in this case can also be deduced from the very
purpose of an action for quo warranto. People v. City Whittier,210 explains that the
remedy of quo warranto is intended to prevent continuing exercise of an authority
unlawfully asserted. Indeed, on point is People v. Bailey,211 when it ruled that
because quo warranto serves to end continuous usurpation, no statute of
limitations applies to the action. Needless to say, no prudent and just court would
allow an unqualified person to hold public office, much more the highest position in
the Judiciary.
In fact, in Cristobal, the Court considered certain exceptional circumstances which
took the case out of the statute of limitations, to wit: (1) there was no acquiescence
to or inaction on the part of the petitioner, amounting to the abandonment of his
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right to the position; (2) it was an act of the government through its responsible
officials which contributed to the delay in the filing of the action; and (3) the petition
was grounded upon the assertion that petitioner's removal from the questioned
position was contrary to law.
In this case, the Republic cannot be faulted for questioning respondent's
qualification for office only upon discovery of the cause of ouster.
As will be demonstrated hereunder, respondent was never forthright as to whether
or not she filed her SALNs covering the period of her employment in U.P. Recall
that during her application for the Chief Justice position, the JBC required the
submission of her previous SALNs. In response to the JBC, respondent never
categorically stated that she filed the required SALNs. Instead, she cleverly hid the
fact of non-filing by stating that she should not be required to submit the said
documents as she was considered to be coming from private practice; that it was
not feasible to retrieve most of her records in the academe considering that the
same are more than fifteen years old; and that U.P. already cleared her of "all
academic/administrative responsibilities, money and property accountabilities and
from administrative charges as of June 1, 2006"212 in Clearance213 dated
September 19, 2011.
Even up to the present, respondent has not been candid on whether she filed the
required SALNs or not. While respondent stated in her Comment that she filed the
required SALNs when she was still connected with the U.P. College of Law,214 she
again offered as support the U.P. Clearance above-cited; that she was considered
as coming from private practice when she was nominated as Associate Justice of
the Supreme Court, hence, should not be required to submit those SALNs; and
that it was not feasible for her to retrieve said SALNs from U.P. as her records
therein are more than 15 years old. Notably, these are mere reiterations of her
representations before the JBC.
Hence, until recently when respondent's qualification for office was questioned
during the hearings conducted by the House Committee on Justice on the
impeachment complaint against the respondent, there was no indication that would
have prompted the Republic to assail respondent's appointment, much less
question the wisdom or reason behind the said recommending and appointing
authorities' actions. The defect on respondent's appointment was therefore not
discernible, but was, on the contrary, deliberately rendered obscure.
Given the foregoing, there can be no acquiescence or inaction, in this case, on the
part of the Republic as would amount to an abandonment of its right to seek
redress against public wrong and vindicate public interest. Neither can delay be
attributed to the Republic in commencing the action since respondent deliberately
concealed the fact of her disqualification to the position. Prescription, therefore,
cannot be pleaded against the Republic.
Neither can respondent successfully invoke Act No. 3326215 as mentioned in her
Table of Authorities.216 Respondent refers to Section 1217 thereof which provides
for the prescriptive periods for violations penalized by special acts and municipal
ordinances. Plainly, Act No. 3326 is inapplicable to the instant petition as
respondent is not being sought to be penalized for violation of the laws relating to
the non-filing or incomplete, irregular or untruthful filing of SALNs. At any rate,
even the theorized applicability of Act No. 26 will not work to respondent's
advantage given that Section 2218 thereof provides that the prescriptive period shall
be reckoned either from the day of the commission of the violation of the law, or if
such be not known at the time, from the discovery thereof and the institution of the
judicial proceeding for its investigation and punishment.
Finally, it bears to stress that this Court finds it more important to rule on the merits
of the novel issues imbued with public interest presented before Us than to dismiss
the case outright merely on technicality. The Court cannot compromise on the
importance of settling the controversy surrounding the highest position in the
Judiciary only to yield to the unacceptable plea of technicality. It is but more
prudent to afford the Republic, as well as the respondent, ample opportunities to
present their cases for proper and just disposition of the case instead of dismissing
the petition outright on the ground of prescription. Inasmuch as the ultimate
consideration in providing for one-year prescriptive period was public interest, so is
it the same consideration which prompts this Court not to act nonchalantly and idly
watch title to the public office in question be continuously subjected to uncertainty.
Indeed, dismissal of cases on technicality is frowned upon especially where public
interest is at the other end of the spectrum.
III.
Respondent is Ineligible as Candidate and Nominee for the Position of Chief
Justice
To arrive at judicious appreciation of the parties' respective contentions as to
respondent's qualification for the position of Chief Justice, the Court first reviews
the supervisory authority exercised by it over the JBC, and visits the JBC's rules
and procedure relating to the acceptance and nomination of respondent as Chief
Justice.
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 A.
The Court Exercises Supervisory Authority Over the JBC
The Court's supervisory authority over the JBC includes ensuring that the
JBC complies with its own rules
Section 8(1), Article VIII of the Constitution provides:
A Judicial and Bar Council is hereby created under the supervision of the
Supreme Court, composed of the Chief Justice as ex officioChairman, the
Secretary of Justice, and representative of the Congress as ex officio Members,
representative of the Integrated Bar, professor of law, retired Member of the
Supreme Court, and representative of the private sector. (Emphasis ours)
Ambil, Jr. v. Sandiganbayan, et al.,219 elucidates on the power of supervision in
general:
On the other hand, the power of supervision means "overseeing or the authority of
an officer to see to it that the subordinate officers perform their duties." If the
subordinate officers fail or neglect to fulfill their duties, the official may take such
action or step as prescribed by law to make them perform their duties. Essentially,
the power of supervision means no more than the power of ensuring that laws are
faithfully executed, or that subordinate officers act within the law. The supervisor or
superintendent merely sees to it that the rules are followed, but he does not lay
down the rules, nor does he have discretion to modify or replace them.220
Reflective of the above and similar pronouncements,221 the seminal case
of Jardeleza v. Chief Justice Ma. Lourdes P. A. Sereno, et al.,222 explains that the
power of supervision being power of oversight does not authorize the holder of the
supervisory power to lay down the rules nor to modify or replace the rules of its
subordinate. If the rules are, however, not or improperly observed, then the
supervising authority may order the work be done or redone, but only for the
purpose of conforming to such rules.
Thus, in interpreting the power of the Court vis-a-vis the power of the JBC, it is
consistently held that the Court's supervisory power consists of seeing to it that the
JBC complies with its own rules and procedures. As when the policies of the JBC
are being attacked, the Court, through its supervisory authority over the me, has
the duty to inquire about the matter and ensure that the JBC is compliant with its
own rules.223
The JBC occupies unique position in the body of government. While the JBC is
created by the Constitution, the Constitution itself prescribes that it exists as an
office subordinate to the Supreme Court. Thus, under the Constitution, the JBC is
chaired by the Chief Justice of the Supreme Court and it is the Supreme Court that
determines the emoluments of the regular JBC members and provides for the
appropriations of the me in its annual budget.224
The Constitution also vests upon the JBC the principal function of recommending
appointees to the Judiciary and such other functions and duties as the Supreme
Court may assign to it.225 On this, Justice Arturo Brion, in his Concurring and
Dissenting Opinion in De Castro v. Judicial and Bar Council, et al.,226offers
succinct point:
Under this definition, the Court cannot dictate on the JBC the results of its
assigned task, i.e., who to recommend or what standards to use to determine who
to recommend. It cannot even direct the JBC on how and when to do its duty,
but it can, under its power of supervision, direct the JBC to "take such
action or step as prescribed by law to make them perform their duties," if the
duties are not being performed because of JBC's fault or inaction, or
because of extraneous factors affecting performance. Note in this regard
that, constitutionally, the Court can also assign the JBC other functions and
duties a power that suggests authority beyond what is purely
supervisory.227 (Emphasis ours)
JBC's absolute autonomy from the Court as to place its non-action or improper
actions beyond the latter's reach is therefore not what the Constitution
contemplates.
What is more, the JBC's duty to recommend or nominate, although calling for the
exercise of discretion, is neither absolute nor unlimited.
In Villanueva v. Judicial and Bar Council,228 this Court explained that while certain
leeway must be given to the JBC in screening aspiring magistrates, the same does
not give it an unbridled discretion to ignore Constitutional and legal requirements:
The functions of searching, screening, and selecting are necessary and incidental
to the JBC's principal function of choosing and recommending nominees for
vacancies in the Judiciary for appointment by the President. However, the
Constitution did not lay down in precise terms the process that the JBC shall follow
in determining applicants' qualifications. In carrying out its main function, the
JBC has the authority to set the standards/criteria in choosing its nominees
for every vacancy in the Judiciary, subject only to the minimum
qualifications required by the Constitution and law for every position. The
search for these long held qualities necessarily requires degree of flexibility in
order to determine who is most fit among the applicants. Thus, the JBC has
sufficient but not unbridled license to act in performing its duties.
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JBC's ultimate goal is to recommend nominees and not simply to fill up judicial
vacancies in order to promote an effective and efficient administration
ofjustice.229 (Emphasis ours)
So too, the JBC's exercise of discretion is not automatically equivalent to an
exercise of policy decision as to place, in wholesale, the JBC process beyond the
scope of the Comi's supervisory and corrective powers. The primary limitation to
the JBC's exercise of discretion is that the nominee must possess the minimum
qualifications required by the Constitution and the laws relative to the position.
While the resolution of who to nominate as between two candidates of equal
qualification cannot be dictated by this Court upon the JBC, such surrender of
choice presupposes that whosoever is nominated is not otherwise disqualified. The
question of whether or not nominee possesses the requisite qualifications is
determined based on facts and therefore does not depend on, nor call for, the
exercise of discretion on the part of the nominating body.
Thus, along this line, the nomination by the JBC is not accurately an exercise of
policy or wisdom as to place the JBC's actions in the same category as political
questions that the Court is barred from resolving. Questions of policy or wisdom
refer "to those questions which, under the Constitution, are to be decided by the
people in their sovereign capacity, or in regard to which full discretionary authority
has been delegated to the legislative or executive branch of government."230
Baker v. Carr231 gives the classic definition of political question:
x x x [p]rominent on the surface of ruiy case held to involve political question is
found textually demonstrable constitutional commitment of the issue to coordinate
political department; or lack of judicially discoverable and manageable standards
for resolving it; or the impossibility of deciding without an initial policy determination
of kind clearly for non-judicial discretion; or the impossibility of court's undertaking
independent resolution without expressing lack of the respect due coordinate
branches of government; or an unusual need for unquestioning adherence to
political decision already made; or the potentiality of embarrassment from
multifarious pronouncements by various departments on the one question.
Obviously, the exercise of the JBC's discretion in the nomination process is not full
as it is limited by the requirements prescribed by the Constitution and the laws for
every position. It does not involve aquestion of policy but simply determination,
based on facts, of whether candidate possesses the requisite qualifications or not.
The JBC neither assumes an existence separate from the Judiciary as it is not
intended to be an independent Constitutional body but merely Constitutional office
created and expressly subjected to the Court's supervision. Judicial encroachment
upon the exercise of wisdom of co-equal branch of the government, which is the
very basis of the political question doctrine, is therefore not attendant when the
Court supervises and reviews the action of the JBC which is neither an executive
nor legislative branch enjoying independent political prerogatives.
In fine, the Court has authority, as an incident of its power of supervision over the
JBC, to insure that the JBC faithfully executes its duties as the Constitution
requires of it. Wearing its hat of supervision, the Court is thus empowered to
inquire into the processes leading to respondent's nomination for the position of
Chief Justice on the face of the Republic's contention that respondent was
ineligible to be candidate to the position to begin with.
Qualifications under the Constitution cannot be waived or bargained away
by the JBC
As emphasized, the JBC's exercise of discretion is limited by the Constitution itself
when it prescribed the qualifications absolutely required of person to be eligible for
appointment as Member of the Court.
The qualifications of an aspiring Member of the Supreme Court are enshrined in
Section 7, Article VIII of the Constitution:
SECTION 7. (1) No person shall be appointed Member of the Supreme Court or
any lower collegiate court unless he is natural-born citizen of the Philippines. A
Member of the Supreme Court must be at least forty years of age, and must have
been for fifteen years or more judge of lower court or engaged in the practice of
law in the Philippines.
(2) The Congress shall prescribe the qualifications of judges of lower courts, but no
person may be appointed judge thereof unless he is citizen of the Philippines and
member of the Philippine Bar.
(3) Member of the Judiciary must be person of proven competence, integrity,
probity, and independence. (Emphasis ours)
Evidently, more than age, citizenship and professional qualifications, Our
fundamental law is clear that member of the Judiciary must be person of proven
competence, integrity, probity and independence. The inclusion of subsection is
explained in this wise:
xxxx
MR. NOLLEDO. Thank you, Mr. Presiding Officer.
My amendment is to add new subsection (3) on Section which reads: MEMBER
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OF THE Judiciary MUST BE PERSON OF PROVEN COMPETENCE,
INTEGRITY, PROBITY, AND INDEPENDENCE.
Before the Committee decides on whether or not to accept the amendment, would
like to explain it first.
Mr. Presiding Officer, this is moral provision lifted with modifications from the
"Canons of Judicial Ethics." The reputation of our justices and judges has been
unsavory. hate to say this, but it seems that it has become the general rule that the
members of the Judiciary are corrupt and the few honest ones are the exceptions.
We hear of justices and judges who would issue injunctive relief to the highest
bidder and would decide cases based on hundreds of thousands, and even
millions, mercenary reasons.
The members of the deposed Supreme Court, with few exceptions, catered to the
political likings and personal convenience of Mr. Marcos by despicably
surrendering their judicial independence. Why should we resist incorporating
worthy moral principles in our fundamental law? Why should we canalize our
conservative thoughts within the narrow confines of pure legalism?
I plead to the members of the Committee and to my colleagues in this
Constitutional Commission to support my amendment in order to strengthen the
moral fiber of our Judiciary. Let not our Constitution be merely legal or political
document. Let it be moral document as well.
x x x232
Requirement of these traits stems from the need to ensure the strength and
sustainability of the third branch of the government. Caperton v. A.T. Massey Coal
Co., Inc.,233 sufficiently explains the state interest involved in safeguardingjudicial
integrity:
Courts, in our system, elaborate principles of law in the course of resolving
disputes. The power and the prerogative of court to perform this function rest, in
the end, upon the respect accorded to its judgments. The citizen's respect for
judgments depends in turn upon the issuing court's absolute probity. Judicial
integrity is, in consequence, state interest of the highest order.
An approximation of what defines the term "integrity" was made by the Court
in Jardeleza, as follows:
In the performance of this sacred duty, the JBC itself admits, as stated in the
"whereas clauses" of JBC-009, that qualifications such as "competence,
integrity, probity and independence are not easily determinable as they are
developed and nurtured through the years." Additionally, "it is not possible or
advisable to lay down iron-clad rules to determine the fitness of those who aspire
to become Justice, Judge, Ombudsman or Deputy Ombudsman." Given this
realistic situation, there is need "to promote stability and uniformity in JBC's
guiding precepts and principles." set of uniform criteria had to be established in the
ascertainment of "whether one meets the minimum constitutional qualifications and
possesses qualities of mind and heart expected of him" and his office. Likewise for
the sake of transparency of its proceedings, the JBC had put these criteria in
writing, now in the form of JBC-009. True enough, guidelines have been set in the
determination of competence, "probity and independence," soundness of physical
and mental condition, and "integrity."
As disclosed by the guidelines and lists of recognized evidence of qualification laid
down in JBC-009, "integrity" is closely related to, or if not, approximately
equated to an applicant's good reputation for honesty, incorruptibility,
irreproachable conduct, and fidelity to sound moral and ethical standards.
That is why proof of an applicant's reputation may be shown in certifications or
testimonials from reputable government officials and non-governmental
organizations and clearances from the courts, National Bureau of Investigation,
and the police, among others. In fact, the JBC may even conduct discreet
background check and receive feedback from the public on the integrity, reputation
and character of the applicant, the merits of which shall be verified and checked.
As qualification, the term is taken to refer to a virtue, such that, "integrity is the
quality of person's character."234 (Emphasis ours)
The case of Jardeleza, however, is not the first time this Court interpreted the
requirement of integrity. In Samson v. Judge Caballero,235 this Court dismissed
judge for "obvious lack of integrity" in making false statement in his Personal Data
Sheet (PDS). Meanwhile, in Re: Judge Jaime V. Quitain,236 this Court declared
Judge Quitain to be dishonest and lacking in integrity when he failed to disclose in
his PDS that he was imposed penalty of dismissal from service in an administrative
case filed against him.
Emphatically, integrity is not only prerequisite for an aspirng Member of the Court
but is likewise continuing requirement common to judges and lawyers alike. Canon
of the New Code of Judicial Conduct237 provides:
CANON 2
INTEGRITY
Integrity is essential not only to the proper discharge of the judicial office but also
to the personal demeanor of judges.
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SECTION 1. Judges shall ensure that not only is their conduct above reproach, but
that it is perceived to be so in the view of reasonable observer.
SEC. 2. The behavior and conduct of judges must reaffirm the people's faith in the
integrity of the Judiciary. Justice must not merely be done but must also be seen to
be done.
SEC. 3. Judges should take or initiate appropriate disciplinary measures against
lawyers or court personnel for unprofessional conduct of which the judge may have
become aware.
The Code of Professional Responsibility, equally applicable to respondent being
first and foremost lawyer, mince no words in requiring that lawyer shall perform his
profession in manner compatible with the integrity of the profession, thus:
CANON - LAWYER SHALL MAKE HIS LEGAL SERVICES AVAILABLE IN AN
EFFICIENT AND CONVENIENT MANNER COMPATIBLE WITH THE
INDEPENDENCE, INTEGRITY AND EFFECTIVENESS OF THE PROFESSION.
Rule 2.01 A lawyer shall not reject, except for valid reasons, the cause of the
defenseless or the oppressed.
Rule 2.02 In such cases, even if the lawyer does not accept case, he shall not
refuse to render legal advice to the person concerned if only to the extent
necessary to safeguard the latter's rights.
Rule 2.03 A lavvyer shall not do or permit to be done any act designed primarily to
solicit legal business.
Rule 2.04 A lawyer shall not charge rates lower than those customarily prescribed
unless the circumstances so warrant.
xxxx
CANON - LAWYER SHALL AT ALL TIMES UPHOLD THE INTEGRITY AND
DIGNITY OF THE LEGAL PROFESSION AND SUPPORT THE ACTIVITIES OF
THE INTEGRATED BAR.
Rule 7.01 A lawyer shall be answerable for knowingly making false statement or
suppressing material fact in connection with his application for admission to the
bar.
Rule 7.02 A lawyer shall not support the application for admission to the bar of any
person known by him to be unqualified in respect to character, education, or other
relevant attribute.
Rule 7.03 A lawyer shall not engage in conduct that adversely reflects on his
fitness to practice law, nor shall he whether in public or private life, behave in
scandalous manner to the discredit of the legal profession.
It is also important to note that the Court has always viewed integrity with goal of
preserving the confidence of the litigants in the Judiciary. In Edaño v. Judge
Asdala,238 this Court stated that:
The New Code of Judicial Conduct for the Philippine Judiciary mandates that
judges must not only maintain their independence, integrity and impartiality; but
they must also avoid any appearance of impropriety or partiality, which may erode
the peoples faith in the Judiciary. Integrity and impartiality, as well as the
appearance thereof, are deemed essential not just in the proper discharge of
judicial office, but also to the personal demeanor of judges. This standard applies
not only to the decision itself, but also to the process by which the decision is
made. Section 1, Canon 2, specifically mandates judges to ensure that not only is
their conduct above reproach, but that it is perceived to be so in the view of
reasonable observers. Clearly, it is of vital importance not only that
independence, integrity and impartiality have been observed by judges and
reflected in their decisions, but that these must also appear to have been so
observed in the eyes of the people, so as to avoid any erosion of faith in the
justice system. Thus, judges must be circumspect in their actions in order to
avoid doubt and suspicion in the dispensation of justice.239 (Emphasis ours)
To make sure that applicants to judicial posttwns possess these constitutionally-
prescribed character requirement, the JBC was created. Jardeleza captures the
purpose of the JBC which it finds to be rooted in the categorical constitutional
declaration that "[a] member of the Judiciary must be person of proven
competence, integrity, probity, and independence." To ensure the fulfillment of
these standards in every member of the Judiciary, the JBC has been tasked to
screen aspiring judges and justices, among others, making certain that the
nominees submitted to the President are all qualified and suitably best for
appointment. Jardeleza continues that, in this manner, the appointing process itself
is shielded from the possibility of extending judicial appointment to the undeserving
and mediocre and, more importantly, to the ineligible or disqualified.
Thus, in compliance with their mandate, the JBC provided for Rule on Integrity in
JBC-009 Rules,240 as follows:
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 RULE 4
INTEGRITY
Section 1. Evidence of Integrity The council shall take every possible step to verify
the applicants records and of reputation for honesty, integrity, incorruptibility,
irreproachable conduct and fidelity to sound moral and ethical standards. For this
purpose, the applicant shall submit to the council certifications or testimonials
thereof from reputable government officials and non-governmental organizations,
and clearances from the court National Bureau of Investigation, police, and from
such other agencies as the council may require.
Section 2. Background Check The Council may order discrete [sic] background
check on the integrity, reputation and character of the applicant, and receive
feedback thereon from the public, which it shall check or verify to validate the
means thereof.
Section 3. Testimonies of Parties The Council may receive written opposition to an
applicant on ground of his moral fitness and its discretion, the Council may receive
the testimony of the oppositor at hearing conducted for the purpose, with due
notice to the applicant who shall be allowed to be [sic] cross-examine the opposite
and to offer countervailing evidence.
Section 4. Anonymous Complaints Anonymous complaints against an applicant
shall not be given due course, unless there appears on its face probable cause
sufficient to engender belief that the allegations may be true. In the latter case the
Council may either direct discrete [sic] investigation or require the applicant to
comment thereon in writing or during the interview.
Section 5. Disqualification The following are disqualified from being nominated for
appointment to any judicial post or as Ombudsman or Deputy Ombudsman:
1. Those with pending criminal or regular administrative cases;
2. Those with pending criminal cases in foreign courts or tribunals; and
3. Those who have been convicted in any criminal case; or in administrative case,
where the penalty imposed is at least fine or more than P10,000, unless has been
granted judicial clemency.
Section 6. Other instances of disqualification Incumbent judges, officials or
personnel of the Judiciary who are facing administrative complaints under informal
preliminary investigation (IPI) by the Office of the Court of Administrator may
likewise be disqualified from being nominated if, in the determination of the
Council, the charges are serious or grave as to affect the fitness of the applicant
for nomination.
For purpose of this Section and of the preceding Section in so far as pending
regular administrative cases are concerned, the Secretary of the Council shall,
from time to time, furnish the Office of the Court of Administrator the name of an
applicant upon receipt of the application/recommendation and completion of the
required papers; and within ten days from the receipt thereof the Court
Administrator shall report in writing to the Council whether or not the applicant is
facing regular administrative case or an IPI case and the status thereof. In regard
to the IPI case, the Court Administrator shall attach to his report copies of the
complaint and the comment of the respondent.
B.
Compliance with the Constitutional and statutory requirement of filing of
SALN intimately relates to person's integrity.
Respondent postulates that the filing of SALNs bear no relation to the
Constitutional qualification of integrity. In so arguing, respondent loses sight of the
fact that the SALN requirement is imposed no less than by the Constitution and
made more emphatic by its accompanying laws and its implementing rules and
regulations. In other words, one who fails to file his or her SALN violates the
Constitution and the laws; and one who violates the Constitution and the laws
cannot rightfully claim to be person of integrity as such equation is theoretically
and practically antithetical.
We elaborate:
The filing of SALN is Constitutional and statutory requirement
The filing SALN is an essential requirement to one's assumption of public post. It
has Constitutional, legal and jurisprudential bases.
Of paramount significance, Section 17, Article XI of the Constitution on the
Accountability of Public Officers states:
Section 17. public officer or employee shall, upon assumption of office and
as often thereafter as may be required by law, submit declaration under oath
of his assets, liabilities, and net worth. In the case of the President, the Vice-
President, the Members of the Cabinet, the Congress, the Supreme Court, the
Constitutional Commissions and other constitutional offices, and officers of the
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armed forces with general or flag rank, the declaration shall be disclosed to the
public in the manner provided by law. (Emphasis ours) In 1961, R.A. No. 3019 was amended by R.A. No. 3047242 by specifying the period
However, even prior to the 1987 Constitution, and as early as 1960, our laws within which public official should make the disclosure and enumerating certain
public officials who are exempt from the requirement.
through R.A. No. 3019, required from every public officer detailed and sworn
statement of their assets and liabilities, thus:
Even during the martial law years, under then President Marcos, the obligation
SECTION 7. Statement of assets and liabilities. Every public officer, within thirty
imposed upon public officers and employees to declare their assets and liabilities
days after assuming office, thereafter, on or before the fifteenth day of April
following the close of every calendar year, as well as upon the expiration of his was maintained under Presidential Decree (P.D.) No. 379243 but with the curious
term of office, or upon his resignation or separation from office, shall prepare and addition that the filing and submission of SALN are now to be required from all
citizens, subject to few exceptions. P.D. No. 379 was later on amended by P.D.
file with the office of the corresponding Department Head, or in the case of Head of
No. 417244 which amended the contents of the statement and the manner of
department or Chief of an independent office, with the Office of the President, true,
providing the acquisition cost of the properties. Yet still, P.D. No. 379 was further
detailed sworn statement of assets and liabilities, including statement of the
amended by P.D. No. 555,245 which prescribed stiffer penalties for violation
amounts and sources of his income, the amounts of his personal and family
expenses and the amount of income taxes paid for the next preceding calendar thereof.
year: Provided, That public officers assuming office less than two months before
Two years after the birth of the 1987 Constitution, R.A. No. 6713 or the Code of
the end of the calendar year, may file their first statement on or before the fifteenth
Conduct and Ethical Standards for Public Officials and Employees246 was enacted
day of April following the close of the said calendar year.
and thereby expanded the obligation to disclose by enumerating the information
SECTION 8. Prima facie evidence of and dismissal due to unexplained wealth. If in required to be disclosed as regards the assets, liabilities, business interests and
accordance with the provisions of Republic Act Numbered One thousand three financial connections; requiring the identification and disclosure of relatives in
hundred seventy-nine, public official has been found to have acquired during his government; making the statements and disclosures available and accessible to
the public; and prohibiting certain acts.
incumbency, whether in his name or in the name of other persons, an amount of
property and/or money manifestly out of proportion to his salary and to his other
In particular, Sections and 11 of R.A. No. 6713 provide:
lawful income, that fact shall be ground for dismissal or removal. Properties in the
Section 8. Statements and Disclosure. Public officials and employees have an
name of the spouse and dependents of such public official may be taken into
consideration, when their acquisition through legitimate means cannot be obligation to accomplish and submit declarations under oath of, and the public has
the right to know, their assets, liabilities, net worth and financial and business
satisfactorily shown. Bank deposits in the name of or manifestly excessive
interests including those of their spouses and of unmarried children under eighteen
expenditures incurred by the public official, his spouse or any of their dependents
(18) years of age living in their households.
including but not limited to activities in any club or association or any ostentatious
display of wealth including frequent travel abroad of non-official character by any
public official when such activities entail expenses evidently out of proportion to (A) Statements of Assets and Liabilities and Financial Disclosure.
legitimate income, shall likewise be taken into consideration in the enforcement of
- All public officials and employees, except those who serve in an honorary
this section, notwithstanding any ovision of law to the contrary. The circumstances
capacity, laborers and casual or temporary workers, shall file under oath their
hereinabove mentioned shall constitute valid ground for the administrative
Statement of Assets, Liabilities and Net Worth and Disclosure of Business
suspension of the public official concerned for an indefinite period until the
Interests and Financial Connections and those of their spouses and unmarried
investigation of the unexplained wealth is completed.
children under eighteen (18) years of age living in their households.
Respondent herself, in her Dissenting Opinion in Phil. Savings Bank v. Senate
Impeachment Court241 interprets that "failure to comply" with the law is "prima The two documents shall contain information on the following:
facie evidence of unexplained wealth, which may result in the dismissal from
service of the public officer."

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(a) real property, its improvements, acquisition costs, assessed value and current
fair market value;
(b) personal property and acquisition cost;
(c) all other assets such as investments, cash on hand or in banks, stocks, bonds,
and the like;
(d) liabilities, and;
(e) all business interests and financial connections.
The documents must be filed:
(a) within thirty (30) days after assumption of office;
(b) on or before April 30, of every year thereafter; and
(c) within thirty (30) days after separation from the service.
All public officials and employees required under this section to file the aforestated
documents shall also execute, within thirty (30) days from the date of their
assumption of office, the necessary authority in favor of the Ombudsman to obtain
from all appropriate government agencies, including the Bureau of Internal
Revenue, such documents as may show their assets, liabilities, net worth, and also
their business interests and financial connections in previous years, including, if
possible, the year when they first assumed any office in the Government.
Husband and wife who are both public officials or employees may file the required
statements jointly or separately.
The Statements of Assets, Liabilities and Net Worth and the Disclosure of
Business Interests and Financial Connections shall be filed by:
(1) Constitutional and national elective officials, with the national office of the
Ombudsman;
(2) Senators and Congressmen, with the Secretaries of the Senate and the House
of Representatives, respectively; Justices, with the Clerk of Court of the Supreme
Court; Judges, with the Court Administrator; and all national executive officials with
the Office of the President.
(3) Regional and local officials and employees, with the Deputy Ombudsman in
their respective regions;
(4) Officers of the armed forces from the rank of colonel or naval captain, with the
Office of the President, and those below said ranks, with the Deputy Ombudsman
in their respective regions; and
(5) All other public officials and employees, defined in Republic Act No. 3019, as
amended, with the Civil Service Commission.
(B) Identification and disclosure of relatives. It shall be the duty of every public
official or employee to identify and disclose, to the best of his knowledge and
information, his relatives in the Government in the form, manner and frequency
prescribed by the Civil Service Commission.
(C) Accessibility of documents. (1) Any and all statements filed under this Act, shall
be made available for inspection at reasonable hours.
(2) Such statements shall be made available for copying or reproduction after ten
(10) working days from the time they are filed as required by law.
(3) Any person requesting copy of statement shall be required to pay reasonable
fee to cover the cost of reproduction and mailing of such statement, as well as the
cost of certification.
(4) Any statement filed under this Act shall be available to the public for period of
ten (10) years after receipt of the statement. After such period, the statement may
be destroyed unless needed in an ongoing investigation.
(D) Prohibited acts. It shall be unlawful for any person to obtain or use any
statement filed under this Act for:
(a) any purpose contrary to morals or public policy; or
(b) any commercial purpose other than by news and communications media for
dissemination to the general public.
xxxx
Section 11. Penalties. (a) Any public official or employee, regardless of whether
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or not he holds office or employment in casual, temporary, holdover, permanent or
regular capacity, committing any violation of this Act shall be punished with fine not
exceeding the equivalent of six (6) months salary or suspension not exceeding one
(1) year, or removal depending on the gravity of the offense after due notice and
hearing by the appropriate body or agency. If the violation is punishable by heavier
penalty under another law, he shall be prosecuted under the latter statute.
Violations of Sections 7, or of this Act shall be punishable with imprisonment not
exceeding five (5) years, or fine not exceeding five thousand pesos (P5,000), or
both, and, in the discretion of the court of competent jurisdiction, disqualification to
hold public office.
(b) Any violation hereof proven in proper administrative proceeding shall be
sufficient cause for removal or dismissal of public official or employee, even if no
criminal prosecution is instituted against him.
xxxx
The filing of the SALN is so important for purposes of transparency and
accountability that failure to comply with such requirement may result not only in
dismissal from the public service but also in criminal liability. Section of R.A. No.
3019, as amended provides:
Section 9. Penalties for violations. x x x
(b) Any public officer violating any of the provisions of Section of this Act shall be
punished by fine of not less than one thousand pesos nor more than five thousand
pesos, or by imprisonment not exceeding one year and six months, or by both
such fine and imprisonment, at the discretion of the Court.
The violation of said section proven in proper administrative proceeding shall be
sufficient cause for removal or dismissal of public officer, even if no criminal
prosecution is instituted against him.
Bolh Section of R.A. No. 6713 and Section of R.A. No. 3019 require the
accomplishment and submission of true, detailed and sworn statement of assets
and liabilities.247 Further, under Section 11 of R.A. No. 6713, non-compliance with
this requirement is not only punishable by imprisonment and/or fine, it may also
result in disqualification to hold public office. As the Court explained in Hon.
Casimiro, et al. v. Rigor:248
x x x The requirement of filing SALN is enshrined in the Constitution to promote
transparency in the civil service and serves as deterrent against government
officials bent on enriching themselves through unlawful means. By mandate of law,
every government official or employee must make complete disclosure of his
assets, liabilities and net worth in order to avoid any issue regarding questionable
accumulation of wealth. The importance of requiring the submission of complete,
truthful, and sworn SALN as measure to defeat corruption in the bureaucracy
cannot be gainsaid. Full disclosure of wealth in the SALN is necessary to
particularly minimize, if not altogether eradicate, the opportunities for official
corruption, and maintain standard of honesty in the public service. Through the
SALN, the public can monitor movement in the fortune of public official; it serves
as valid check and balance mechanism to verify undisclosed properties and
wealth. The failure to file truthful SALN reasonably puts in doubts the integrity of
the officer and normally amounts to dishonesty.249
As respondent acutely relates her dissent in Philippine Savings Bank:250
In the present case, because of the fact that the Chief Justice is public officer, he is
constitutionally and statutorily mandated to perform positive duty to disclose all of
his assets and liabilities. This already operates as the consent required by law.
The Offices of the Chief Justice and of the 14 Associate Justices of the Supreme
Court are an express creation of the Constitution, which vests them with explicit
powers necessary for the proper functioning of democratic government.
Foremost is the principle that public office is by virtue of the peoples mandate to
exercise sovereign function of the government. Hence, public office is public trust
or agency. Appended to the constitutional principle that public office is public trust
is the tenet that public officers occupy very delicate positions that exact certain
standards generally not demanded from or required of ordinary citizens.
Those who accept public office do so cum onere, or with burden, and are
considered as accepting its burdens and obligations, together with its benefits.
They thereby subject themselves to all constitutional and legislative provisions
relating thereto, and undertake to perform all the duties of their office. The public
has the right to demand the performance of those duties.
One of these burdens or duties is explicitly articulated in Sec. 17 of Art. XI of the
1987 Constitution, viz:
xxxx
This provision reqmres all public officers and employees, regardless of rank, to
declare their assets and liabilities upon their assumption of office, as may be
required by law. However, it likewise imposes positive duty and heavier onus on
the President; the Vice-President; and members of the Cabinet, Congress, the
Supreme Court, Constitutional Commissions and other Constitutional offices and
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officers of the Armed Forces with general or flag ranks to publicly disclose their
assets and liabilities.251 (Citations omitted and emphasis in the original)
Faithful compliance with the requirement of the filing of SALN is rendered even
more exacting when the public official concerned is member of the Judiciary.
In Office of the Court Administrator v. Judge Usman,252 the Court emphasized:
From the foregoing, it is imperative that every public official or government
employee must make and submit complete disclosure of his assets, liabilities and
net worth in order to suppress any questionable accumulation of wealth. This
serves as the basis of the government and the people in monitoring the income
and lifestyle of public officials and employees in compliance with the constitutional
policy to eradicate corruption, to promote transparency in government, and to
ensure that all government employees and officials lead just and modest lives, with
the end in view of curtailing and minimizing the opportunities for official corruption
and maintaining standard of honesty in the public service.
In the present case, respondent clearly violated the abovequoted laws when
he Jailed to file his SALN for the years 2004-2008. He gave no explanation
either why he failed to file his SALN for five (5) consecutive years. While
every office in the government service is public trust, no position exacts
greater demand on moral righteousness and uprightness of an individual
than seat in the Judiciary. Hence, judges are strictly mandated to abide with
the law, the Code of Judicial Conduct and with existing administrative
policies in order to maintain the faith of our people in the administration of
justice.253 (Emphasis ours)
The above holds necessarily true considering that the obligation of members of the
Judiciary to file their respective SALNs is not only statutory requirement but forms
part of the mandatory conduct expected of judge so that an "honorable competent
and independent Judiciary exists to administer justice and thus promote the unity
of the country, the stability of government, and the well-being of the people."254
The Code of Judicial Conduct, in no uncertain terms, provide:
FINANCIAL ACTIVITIES
RULE 5.02 A judge shall refrain from financial and business dealing that tend to
reflect adversely on the court's impartiality, interfere with the proper performance
of judicial activities or increase involvement with lawyers or persons likely to come
before the court. judge should so manage investments and other financial interests
as to minimize the number of cases giving grounds for disqualifications.
xxxx
FINANCIAL DISCLOSURE
RULE 5.08 A judge shall make full financial disclosure as required by
law. (Emphasis ours)
xxxx
Compliance with the SALN requirement indubitably reflects on person's
integrity
To recapitulate, Section 7, Article VIII of the Constitution requires that member of
the Judiciary must be of proven integrity. To be of proven integrity means that the
applicant must have established steadfast adherence to moral and ethical
principles.255
The necessity of having integrity among the members of the judiciary is clearly
discussed in the Commentary on the Bangalore Principles of Judicial Conduct:256
Integrity is the attribute of rectitude and righteousness. The components of integrity
are honesty and judicial morality. judge should always, not only in the discharge of
official duties, act honourably and in manner befitting the judicial office; be free
from fraud, deceit and falsehood; and be good and virtuous in behaviour and in
character. There are no degrees of integrity as so defined. Integrity is absolute. In
the judiciary, integrity is more than virtue; it is necessity.
Failure to file the SALN is clearly violation of the law. The offense is penal in
character and is clear breach of the ethical standards set for public officials and
employees. It disregards the requirement of transparency as deterrent to graft and
corruption. For these reasons, public official who has failed to comply with the
requirement of filing the SALN cannot be said to be of proven integrity and the
Court may consider him/her disqualified from holding public office. In De Castro v.
Field Investigation Office, Office of the Ombudsman,257 We held:
Public service demands the highest level of honesty and transparency from its
officers and employees. The Constitution requires that all public officers and
employees be, at all times, accountable to the people; serve with utmost
responsibility, integrity, loyalty and efficiency; act with patriotism and justice; and
lead modest lives. Public office is public trust; it must be treated as privilege rather
than right, and rest firmly upon one's sense of service rather than entitlement. In
this light, the Court deems it necessary to reiterate, as final note, its
pronouncement in Casimiro v. Rigor:
The constitutionalization of public accountability shows the kind of standards of
public officers that are woven into the fabric of our legal system. To reiterate,
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public office is public trust, which embodies set of standards such as responsibility,
integrity and efficiency. Unfortunately, reality may sometimes depart from these
standards, but our society has consciously embedded them in our laws so that
they may be demanded and enforced as legal principles, and the Court is
mandated to apply these principles to bridge actual reality to the norms envisioned
for our public service.
The requirement to file SALN is not trivial or formal requirement. Neither is it
something over which public officials can exercise discretion. It is mandated by
Our Constitution and laws. It is meant to forge transparency and accountability in
the government and as measure meant to curb corruption. This is dear from the
policy of R.A. No. 6713:
Section 2. Declaration of Policies. It is the policy of the State to promote high
standard of ethics in public service. Public officials and employees shall at all times
be accountable to the people and shall discharge their duties with utmost
responsibility, integrity, competence, and loyalty, act with patriotism and justice,
lead modest lives, and uphold public interest over personal interest.
Respondent nevertheless argues that the filing of SALN has no relation to an
applicant's integrity, moral fitness or character. She cites the cases of Office of the
Ombudsman v. Racho,258Daplas v. Department of Finance and the Office of the
Ombudsman,259Atty. Navarro v. Office of the Ombudsman and Department of
Finance-Revenue Integrity Protection Services,260 to support her argument that in
order to establish lack of integrity, there is an additional requirement that there
must be showing that there is an intent to commit wrong.261
It is inaccurate to use the aforesaid cases to support respondent's conclusion that
her integrity is not affected by her failure to file SALNs.
In Office of the Ombudsman v. Racho,262 the Court upheld the Ombudsman's
finding that Racho is guilty of dishonesty for unexplained wealth. The Court, in that
case, noted that Racho's SALN did not reflect the aggregate amount of his bank
deposits.
In Daplas v. Department of Finance and the Office of the Ombudsman,263 this
Court merely held therein petitioner Daplas guilty of simple negligence instead of
dishonesty and grave misconduct for her failure to declare several real and
personal properties in her SALN. The Court found that "petitioner's failure to
declare the Galant sedan in her SALNs from 1997 to 2003 stemmed from the fact
that the same was registered in her husband's name, and purportedly purchased
out of his personal money".
Meanwhile, in Navarro v. Office of the Ombudsman and Department of Finance-
Revenue Integrity Protection Service,264 this Court exonerated Atty. Navarro of
dishonesty, grave misconduct and violation of R.A. No. 6713. The Court ruled, in
that case, that the properties not reflected in therein petitioner's SALN were
rightfully excluded as they do not actually belong to him. This Court even noted
therein that the SALN before 2011 merely required general statement of one's
assets and liabilities.
It is apparent from the foregoing that the above mentioned cases are factually
different from the instant petition. The aforesaid jurisprudence, aside from
determining the administrative liability of therein public employees, dealt
with misdeclaration of assets or properties. Meanwhile, the instant petition
questions respondent's qualifications and as an incident thereto, the validity of the
process leading to her appointment. Further, the fundamental issue in the case at
bar is not merely inaccurate entries, but the glaring absence of respondent's SALN
for various years prior to her resignation from the U.P. College of Law.
Respondent posits that person's failure to file SALN, without more, would not
automatically negate "integrity."265 It is respondent's theory that the failure to file
SALN without any allegation or evidence that one committed graft and corruption
by acquiring unexplained wealth has no bearing on integrity. Respondent's
argument, however, does not persuade.
The SALN laws contemplate both the (1) physical act of filing her and her family's
statement of assets, liabilities and net worth and (2) filing of true, genuine and
accurate SALN. RA 6713 and RA 3019, being special laws that punish offenses,
are malum prohibitum and not malum in se. Thus, it is the omission or commission
of that act as defined by the law, and not the character or effect thereof, that
detennines whether or not the provision has been violated. An act which is
declared malum prohibitum renders malice or criminal intent completely
immaterial.266 Thus, whether or not respondent accumulated unexplained wealth is
not in issue at this point in time, but whether she, in the first place, complied with
the mandatory requirement of filing of SALNs. Worse, to subscribe to respondent's
view means that the Court would altogether be deprived of the opportunity to
ascertain whether or not she accumulated unexplained wealth as the tools for
doing so, that is, the filed SALNs and the representations contained therein, are
lacking.
Respondent chronically failed to file her SALNs and thus violated the
Constitution, the law and the Code of Judicial Conduct, member of the
Judiciary who commits such violations cannot be deemed to be person of
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proven integrity
To recall, the record of the U.P. HRDO only contains respondent's SALNs for the
years 1985, 1990, 1991, 1993, 1994, 1995, 1996, 1997, and 2002. Later,
respondent produced photocopy of her SALN for 1989 and attached the same to
her Ad Cautelam Manifestation/Submission. On the other hand, the records of the
Central Records Division of the Office of the Ombudsman yields "no SALN filed by
respondent except for the SALN ending December 1998" which was subscribed
only in August 2003 and transmitted by the U.P. HRDO to the Ombudsman only on
December 16, 2003. Further, despite having worked as legal counsel for the
Republic from 2003 to 2006 (up until 2009), there is no record that respondent filed
her SALNs for that period.
Respondent could have easily dispelled doubts as to the filing or nonfiling of the
unaccounted SALNs by presenting them before the Court. Yet, respondent opted
to withhold such information or such evidence, if at all, for no clear reason.
Respondent likewise manifests having been successful in retrieving most of the
"missing" SALNs and yet withheld presentation of such before the Court, except
for photocopy of her 1989 SALN submitted only in the morning of the Oral
Argument and allegedly sourced from the "drawers of U.P." Only in respondent's
Memorandum Ad Cautelam did she attach the SALNs she supposedly recovered.
But the SALNs so attached, except for the 1989 SALN, were the same SALNs
priorly offered by the Republic. Other than offering legal or technical justifications,
respondent has not endeavored to convince this Court of the existence of the still
unaccounted SALNs. As she herself stated in her July 23, 2012 letter to the JBC,
only some, but not all, of her SALNs are infeasible to retrieve. Thus, this Court is
puzzled as to why there has been no account of respondent's more recent SALNs,
particularly those from 2000, 2001, 2003, 2004, 2005 and 2006.
Instead, respondent layers her defenses as follows:
1. Invoking the so-called "Doblada doctrine", respondent maintains having
filed all her SALNs.
Respondent firmly latches on to her allegation that she filed her SALNs, only that
she has no records of the same. It is, however, too shallow and impetuous for this
Court to accept such excuse and disregard the overwhelming evidence to the
contrary.
Respondent urges the Court to apply in her favor the case of Concerned Taxpayer
v. Doblada, Jr.,267 and deem as sufficient and acceptable her statement that she
"maintains that she consistently filed her SALNs." Respondent argues that
in Doblada, the Court gave no evidentiary value to the Office of the Court
Administrator's (OCA) report stating that branch Sheriff had failed to file his SALN
for eighteen (18) years, based only on contrary evidence presented by the
respondent Sheriff that proves the existence of only one (1) of his missing SALNs.
According to respondent, the Court's rationale in Doblada that one cannot readily
conclude that respondent failed to file his sworn SALN simply because these
documents are missing in the OCA's files should likewise be made applicable to
her case. Respondent thus concludes that the Republic must categorically prove
its allegation that respondent did not file her SALNs for all relevant years, and not
just show that the same are no longer on file with the relevant offices.
A more cerebral reading of Doblada, however, poses checkered differences to the
case at bar.
To begin with, the Court imposed the ultimate penalty of dismissal, with forfeiture
of all benefits and with prejudice to re-employment in any branch or service of the
government including government-owned and controlled corporation against
Doblada for his failure to declare true and detailed statement of his assets and
liabilities for the years 1974, 1976, 1989, 1991, 1993, 1995 and 1998. The
pronouncement of the Court with regard to the non-filing of his SALNs for several
years was therefore not the basis for the imposition of the appropriate penalty
against Doblada.
The progenesis of Doblada's troubles was letter-complaint filed by concerned
taxpayer with the Ombudsman. The Ombudsman, in turn, referred the complaint to
the OCA. Upon report and recommendation of the OCA, the Court directed the
National Bureau of Investigation (NBI) to conduct discreet investigation of the case
and thereafter, to submit report thereon. The NBI reported discrepancies in
Doblada's SALNs and his yearly salaries constituting prima facie evidence of
unexplained wealth and further stated that "[Doblada] also failed to submit his
sworn statement of assets and liabilities for the years 1975 to 1988, 1990, 1992,
1994 and 1997 as said documents were not submitted to the NBI by the Records
Control Division of the Supreme Court." Thereafter, the case was referred to the
OCA for evaluation, report and recommendation.
Initially, the OCA reported that Doblada's records disclose that he had not been
submitting his SALNs for the years 1975, 1977 to 1988, 1990, 1992, 1999 and
2000. When asked to explain, Doblada maintains having filed all his SALNs and
admits that he does not have copies of said SALNs as he might have accidentally
disposed of the same during the various times that he transferred office. As proof,
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Doblada submitted copy of letter dated May 7, 2001 sent by the Acting Branch
Clerk of Court, stating therein that attached to said letter are the sworn SAL[N] of
the staff of RTC, Pasig City, Branch 155, including that of respondent's, for the
year 2000. Said letter was established to have been sent to and duly received by
the OCA, and yet Doblada's SALN for 2000 was one of those missing in the OCA's
files.
It was factually established then that Doblada submitted his SALNs to the branch
clerk of court, presumably as the chief or head of the office. The head of the office
then transmitted the original copy of the SALNs received to the repository agency
which, in Doblada's case, is the OCA. Thus, the OCA's report that Doblada did not
file his SALNs was rendered inaccurate by proof that Doblada, through the head of
the office, actually transmitted the required original copy of the 2000 SALN to the
OCA.
Considering the contrary proof presented by Doblada in the form of the letter of the
head of the personnel of Branch 155 that the SALN for 2000 exists and was duly
transmitted and received by the OCA as the repository agency, te Court
therein inferred that Doblada filed his SALNs.
In respondent's case, while the U.P. HRDO, as the concerned personnel division,
produced respondent's SALNs for 1985, 1989, 1990, 1991, 1993, 1994, 1995,
1996, 1997, and 2002, these very same SALNs are neither proven to be in the
records of, nor was proven to have been sent to and duly received by the
Ombudsman as the repository agency. Even then, the Court presently receives the
certified copies of said SALNs as evidence of the existence and the filing thereof.
Nevertheless, for the SALNs which the U.P. HRDO itself cannot produce, i.e.,
1986, 1987, 1988, 1992, 1999, 2000, 2001, 2003, 2004, 2005 and 2006, and not
proven to be in the records of, nor proven to have been sent to and duly received
by the Ombudsman, are altogether different matter. The existence of these SALNs
and the fact of filing thereof were neither established by direct proof constituting
substantial evidence nor by mere inference.
The Court in Doblada also gave the latter the benefit of the doubt considering the
lack of the categorical statement from the OCA, as the repository agency, that
Doblada failed to file his SALN for the relevant years. Te Court observed that the
report of the OCA simply stated that "it does not have on its file the subject SAL[N]
of [Doblada]." Hence, the Court therein concluded that there was no substantial
evidence to show that Doblada failed to file his SALNs for the relevant years.
In stark contrast, the Certification of the Omdusman, as the repository agency in
respondent's case, made the categorical statement that "based on records on
file, there is no SALN filed by [respondent] for calendar years 1999 to 2009 except
SALN ending December 1998 which was submitted to this Office on December 16,
2003."
Respondent, through counsel, attempts to mislead the Court as to the value of the
Ombudsman's Certification by re-directing Our attention to "handwritten
certification"268 affixed by the SALN custodian of the Ombudsman. Upon closer
examination, the "handwritten certification" aside from having been "issued" only
on April 6, 2018 appears to have been made at the behest of respondent's counsel
where the handwritten words may have been tailor-fitted to suit respondent's
theory. The signatory of the "handwritten certification" is the same signatory as that
of the Certification earlier issued by the Ombudsman, and thus the former could
not have possibly negated or altered the tenor of the latter. In any case, such
"handwritten certification" cannot eclipse Certification duly and officially issued by
the Ombudsman in response to subpoena issued by the Congress.
Thus, taking the undisputed pieces of evidence consisting of (1) the U.P. HRDO
certifications proving that respondent's SALNs for 1986, 1987, 1988, 1992, 1999,
2000, 2001, 2003, 2004, 2005 and 2006 are not in its possession; and (2) the
Ombudsman certification that based on its records, there is no SALN filed by
respondent except that for 1998; coupled with respondent's inability to show proof
that these SALNs actually exist and that these were actually transmitted to and
duly received by the Ombudsman as the repository agency, conclusively establish
that for the years 1986, 1987, 1988, 1992, 1999, 2000, 2001, 2003, 2004, 2005
and 2006, respondent did not file her SALNs.
Otherwise stated, on the basis of the evidence on record and respondent's
unexplained failure to support her allegation of filing with substantial proof, the
Court reaches the inevitable conclusion that the only SALNs filed by respondent
were those for the calendar years 1985, 1989, 1990, 1991, 1993, 1994, 1995,
1996, 1997, 1998, and 2002, or only eleven (11) SALNs out of her 20 years in
U.P., or for even more ifher engagement as legal counsel by the Republic and as
Deputy Commissioner of the Commission on Human Rights as lauded in
respondent's PDS, are treated as government service.
It is for this reason that We hold that the Republic was able to discharge its burden
of proof, and thus it becomes incumbent upon respondent to discharge her burden
of evidence. Sps. De Leon, et al., v. Bank of the Philippine Islands 269 offers
distinction between burden of proof and burden of evidence:
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Section 1, Rule 131 of the Rules of Court defines "burden of proof" as "the duty of
party to present evidence on the facts in issue necessary to establish his claim or
defense by the amount of evidence required by law." In civil cases, the burden of
proof rests upon the plaintiff, who is required to establish his case by
preponderance of evidence. Once the plaintiff has established his case, the
burden of evidence shifts to the defendant, who, in turn, has the burden to
establish his defense.270 (Emphasis ours)
Further, the burden of proof in quo warranto proceeding is different when it is filed
by the State. Floyd Mechem in his book, entitled A Treatise on the Law of Public
Offices and Officers,271 explains that when the respondent is called upon at the suit
of the State to show by what warrant he assumes to exercise the functions of
public office, the burden of proving his title rests upon the respondent. When,
however, the respondent has made out prima facie right to the office, it is only at
that time that the burden of evidence shifts to the State.272
Montgomery H. Throop adopted the same view as Mechem. Throop, in his book,
entitled A Treatise on the Law relating to Public Officers and Sureties in Official
Bonds,273 states that upon the trial of an information in the nature of quo warranto,
the prosecutor is not required, in the first instance, to show want of title in the
person, against whom the information is exhibited. The burden is upon the
respondent to establish good title; he must establish the continued existence of
every qualification, necessary to the continued holding of the office, if any such
qualifications exist. But where the respondent has shown good prima facie title, the
burden of proof is shifted to the prosecutor.274
In this jurisdiction, Vicente J. Francisco wrote in his book the Revised Rules of
Court in the Philippines,275 that in quo warranto proceeding, the burden rests on
the defendant or respondent, as against the State at least, to show his right to the
office from which it is sought to oust him. Moreover, since the object of such
proceedings is to test the actual right to the office, and not merely use color of
right, it is incumbent upon the respondent to show good legal title, and not merely
colorable one, for he must rely wholly on the strength of his own title.276
With the submission of its evidence, including the Certifications from the U.P.
College of Law and the Ombudsman showing that respondent did not file all her
SALNs, the Republic has made out prima facie case that respondent failed to
comply with the SALN law. The duty or burden of evidence thus shifted to
respondent to controvert the Republic's prima facie case, otherwise, verdict must
be returned in favor of the Republic.277 However, what respondent merely offered
in response to the Republic's evidence is an unsubstantiated claim that she had
filed all her SALNs. Without admissible documentary and testimonial support, this
bare and uncorroborated assertion scarcely overcomes the Republic's case.
2. Being on leave without pay exempts respondent from filing her SALNs.
Aside from maintaining that she filed all her SALNs, respondent layers her
defenses by saying that her non-filing of SALN is nevertheless excused because
she was on leave from the U.P. College of Law during June 1, 1998 to October 16,
1998, June 1, 2000 to May 31, 2001, June 1, 2001 to May 31, 2002, November 1,
2003 to May 31, 2004, June 1, 2004 to October 31, 2004, February 11, 2005 to
October 31, 2005 and November 15, 2005 to May 31, 2006. However, per the
Certification278 issued by the U.P. HRDO dated December 8, 2017, it appears that
respondent filed her SALN for the year ending December 31, 2002, year she was
purportedly on leave. To this Court, respondent's own act of filing SALN in 2002
negates her argument that being on leave excuses her from filing her SALN. As
likewise pointed out during the Oral Arguments,279 respondent, as regular faculty
member, receives monthly compensation and from at least January 2000 to May
2000 (when she was not on leave), she earned income and thus should have filed
her SALN covering said period.
Further, being on leave from government service is not synonymous with
separation from government service. Suffice to say that one does not cease to
become government employee only because one takes an official leave.
On the contrary, relevant laws provide that all public officials and employees are
required to file SALN.
To review, Section 17, Article XI of the Constitution categorically requires that "[a]
public officer or employee shall, upon assumption of office and as often thereafter
as may be required by law, submit declaration under oath of his assets, liabilities,
and net worth. In the case of the President, the Vice-President, the Members of the
Cabinet, the Congress, the Supreme Court, the Constitutional Commissions and
other constitutional offices, and officers of the armed forces with general or flag
rank, the declaration shall be disclosed to the public in the manner provided by
law."
Section of R.A. No. 6713 states that "[p]ublic officials and employees have an
obligation to accomplish and submit declarations under oath of, and the public has
the right to know, their assets, liabilities, net worth and financial and business
interests including those of their spouses and of unmarried children under eighteen
(18) years of age living in their households." Further, "[t]he [SALN] and the
[d]isclosure of [b]usiness [i]nterests and [f]inancial [c]onnections shall be filed by:
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(1) Constitutional and national elective officials, with the national office of the
Ombudsman; (2) Senators and Congressmen, with the Secretaries of the Senate
and the House of Representatives, respectively; Justices, with the Clerk of Court of
the Supreme Court; Judges, with the Court Administrator; and all national
executive officials with the Office of the President; (3) Regional and local officials
and employees, with the Deputy Ombudsman in their respective regions; (4)
Officers of the armed forces from the rank of colonel or naval captain, with the
Office of the President, and those below said ranks, with the Deputy Ombudsman
in their respective regions; and (5) All other public officials and employees, defined
in RA 3019, as amended, with the Civil Service Commission."
Relatedly, Section 34, Chapter 9, Book of the Administrative Code of 1987 also
states that "[a] public officer or employee shall upon assumption of office and as
often thereafter as may be required by law, submit declaration under oath of his
assets, liabilities, and net worth."
Section of R.A. No. 6713, however, provides for certain exceptions to the
requirement: (1) those serving in honorary capacity these are persons who are
working in the government without service credit and without pay; (2) laborers
these are persons who perform ordinary manual labor; and (3) casual or temporary
workers. Respondent claims exception on the argument that for the periods she
was on official leave from U.P., she did not receive any pay.
This statement, however, is inaccurate. The fact that respondent did not receive
any pay for the periods she was on leave does not make her government worker
"serving in an honorary capacity" to he exempted from the SALN laws. She did not
receive pay not because she was serving in an honorary capacity, but for the
simple reason that she did not render any service for said period. Fundamental is
the rule that workers who were not required to work are not, by law, entitled to any
compensation.
3. Respondent is not required by law to keep record of her SALNs.
Respondent invokes Section 8, paragraph C(4) of R.A. No. 6713 which provides:
Section 8. Statements and Disclosure. x x x
xxxx
(C) Accessibility of documents. (1) Any and all statements filed under this Act, shall
be made available for inspection at reasonable hours.
(2) Such statements shall be made available for copying or reproduction after ten
(10) working days from the time they are filed as required by law.
(3) Any person requesting copy of statement shall be required to pay reasonable
fee to cover the cost of reproduction and mailing of such statement, as well as the
cost of certification.
(4) Any statement filed under this Act shall be available to the public for period of
ten (10) years after receipt of the statement. After such period, the statement may
be destroyed unless needed in an ongoing investigation.
There is no argument that the filed SALNs need not be retained by the receiving
officer or the custodian after more than ten years from the filing or receipt thereof
as such documents may be destroyed unless needed in an ongoing investigation.
In this context, the filer is likewise under no obligation to keep records of such
SALNs after the ten-year period.
The fact, however, remains that even respondent's more recent SALNs falling
within the ten-year period for her application to the Chief Justice position are not
on record. Logically, public officer under question should obtain certification from
the repository agency to attest to the fact of filing. In the event that the SALNs
were actually filed but missing, such certification should likewise attest to the fact
that the SALNs filed could no longer be located due to valid reason (such as
destruction by natural calamity, gutted by fire or destruction pursuant to the ten-
year period abovecited).
4. Respondent was never asked to comply with the SALN laws.
Respondent likewise banks on the supposed presumption that she filed the SALNs
considering that the U.P. HRDO never called her attention to the non-filing thereof
and instead, released clearance and certification in her favor. However, said
circumstance, if true, does not detract from the fact that the duty to properly
accomplish the SALN belongs to the public official and the corrective action that
the concerned authority is expected to undertake is limited only to typographical or
mathematical rectifications.
For the years that respondent rendered government service in U.P., the relevant
rules would be that provided under the Rules Implementing the Code of Conduct
and Ethical Standards for Public Officials and Employees dated April 21, 1989.
Rule VIII thereof provides:
Rule VIII
Review and Compliance Procedure
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Section 1. The following shall have the authority to establish compliance
procedures for the review of statements to determine whether said statements
have been properly accomplished:
(a) In the case of Congress, the designated committees of both Houses of
Congress subject to approval by the affirmative vote of the majority of the
particular House concerned;
(b) In the case of the Executive Department, the heads of the departments,
offices and agencies insofar as their respective departments, offices and
agencies are concerned subject to approval of the Secretary of Justice
(c) In the case of the Judicial Department, the Chief Justice of the Supreme
Court; and
(d) In the case of the Constitutional Commissions and other Constitutional
Offices, the respective Chairman and members thereof; in the case of the
Office of the Ombudsman, the Ombudsman.
The above official shall likewise have the authority to render any opinion
interpreting the provisions on the review and compliance procedures in the filing of
statements of assets, liabilities, net worth and disclosure of information.
In the event said authorities determine that statement is not properly filed, they
shall inform the reporting individual and direct him to take the necessary corrective
action.
The individual to whom an opinion is rendered, and any other individual involved in
similar factual situation, and who, after issuance of the opinion acts in good faith in
accordance with it shall not be subject to any sanction provided in the Code.
The Rules implementing R.A. No. 6713 thus authorize only certain officials of the
Legislative, Executive and Judicial Departments, and the Constitutional
Commissions and Constitutional offices to establish compliance procedures for the
review of statements in the SALN to determine whether said statements have been
been properly accomplished. The said officials are also authorized to render
opinions interpreting the provisions on the review and compliance procedures and
to determine whether or not SALN is properly filed. If the SALN was not properly
filed, the authorized officials are required to inform the reporting individual and
direct him/her to take the necessary corrective action. The records do not show
that at the time respondent assumed her post as professor in U.P., or at any time
thereafter until her resignation, that concerned authorized official/s of the Office of
the President or the Ombudsman had established compliance procedures for the
review of SALNs filed by officials and employees of State Colleges and
Universities, like U.P.
The ministerial duty of the head of office to issue compliance order came about
only on April 16, 2006 when the Civil Service Commission (CSC) issued
Memorandum Circular No. 10, s. 2006 amending Rule VIII. This was pursuant to
CSC Resolution No. 06-0231 dated February 1, 2006 wherein the esc adopted the
revised rules on review and compliance procedure. As such, the U.P. HRDO could
not have been expected to perform its ministerial duty of issuing compliance orders
to respondent when such rule was not yet in existence at that time.
At any rate, Navarro v. Office of the Ombudsman280 clarifies on the limited
corrective action which the head of office can perform as regards the review of
SALNs:
xxxx
Lest it be misunderstood, the corrective action to be allowed should only
refer to typographical or mathematical rectifications and explanation of
disclosed entries. It does not pertain til hidden, undisclosed or undeclared
acquired assets which the official concerned intentionally concealed by one
way or another like, for instance, the use of dummies. There is actually no
hard and fast rule. If income has been actually reported to the BIR in one's ITR,
such fact can be considered sign of good faith.
xxxx
The Court is mindful of the duty of public officials and employees to disclose their
assets, liabilities and net worth accurately and truthfully. In keeping up with the
constantly changing and fervent society and for the purpose of eliminating
corruption in the government, the new SALN is stricter, especially with regard to
the details of real properties, to address the pressing issue of transparency among
those in the government service. Although due regard is given to those charged
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with the duty of filtering malicious elements in the government service, it must still amount to dishonesty if the same is attended by malicious intent to conceal the
be stressed that such duty must be exercised with great caution as grave truth or to make false statements.283
consequences result therefrom. Thus, some leeway should be accorded the public
officials. They must be given the opportunity to explain any prima facie appearance On its face, the SALNs filed by respondent covering her years of government
of discrepancy. To repeat, where his explanation is adequate, convincing service in U.P., appear to have been executed and filed under suspicious
and verifiable, his assets cannot be considered unexplained wealth or illegally circumstances:
obtained.281 (Emphasis ours)
5. Respondent's inclusion in the matrix of candidates with complete (a) Respondent's SALN as of December 31, 1996 was accomplished and
requirements and in the shortlist nominated by the JBC confirms or ratifies notarized only on June 29, 1998, or two years late;
her compliance with the SALN requirement.
(b) Her SALN as of December 31, 1998 was filed only in 2003, or five years late;
Respondent, both in her pleadings and in the Oral Arguments, harps on the
(c) Her SALNs for the years 1997, 1998, 1999 and 2002 were notarized only on
purported failure of the JBC to exclude her from the list of shortlisted applicants.
She points to at least eleven times that the JBC could have disqualified her due to August 21, 2003;284
her lack of SALNs but failed to do so. Hence, she argues that she is deemed to
(d) Both the 1996285 and 1997286 SALNs were subscribed and sworn to by
have substantially complied with the legal requirements at the time of her
respondent before Zenaida P. Cruz (Administrative Officer IV, Human Resource
application.
Development and Records Section, U.P. Law Center) on June 29, 1998. However,
under the Notarial Registry of Eugenia A. Borras, four SALNs of respondent were
Respondent's argument is specious. The invalidity of respondent's appointment
springs from her lack of qualifications. Her inclusion in the shortlist of candidates acknowledged before her on August 21, 2003 as cited in the next preceding
for the position of Chief Justice does not negate, nor supply her with the requisite paragraph. It appears thus that there were two SALNs for 1997 executed by
respondent;
proof of integrity. She should have been disqualified at the outset. It must be
underscored that the JBC En Banc included respondent in the shortlist for the
(d) She failed to file her SALNs for 2004, 2005, and 2006 which were the years
position of Chief Justice without deliberating her July 23, 2012 Letter. Without
prejudice to this Court's ruling in A.M No. 17-11-12-SC and A.M. No. 17-11-17-SC, when she received the bulk of her fees from the PIATCO cases. As respondent
the JBC En Banc cannot be deemed to have considered respondent eligible divulged, she received from the Republic, through the OSG, the following fees 287 in
relation to the PIATCO cases:
because it does not appear that respondent's failure to submit her SALNs was
squarely addressed by the body. Her inclusion in the shortlist of nominees and Year Income
subsequent appointment to the position do not estop the Republic or this Court
from looking into her qualifications. Verily, no estoppel arises where the 2004 P7,055,513.56
representation or conduct of the party sought to be estopped is due to ignorance
founded upon an innocent mistake.282 Again, without prejudice to the outcome of 2005 P11,532,226.00
the pending administrative matter, it appears that respondent's inclusion was made
under the erroneous belief that she complied with all the legal requirements 2006 P2,636,006.64
concomitant to the position.
2007 P4,673,866.36
Respondent failed to properly and promptly file her SALNs, again in violation
of the Constitutional and statutory requirements 2008 P4,070,810.93

Further, the failure to file truthful SALN not only puts in doubt the integrity of the 2009 P301,552.00
officer, but such failure to file truthful, complete and accurate SALN would likewise
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 TOTAL P30,269,975.49
(e) Her SALN for 2006 was accomplished only on July 27, 2010 and unsubscribed,
only to be later on claimed by respondent to have been really intended as SALN as
of July 27, 2010;
The SALNs that she submitted in support of her application for Chief Justice
likewise bear badges of irregularities:
(f) Her SALN for 2009 was not accomplished under oath, was likewise belatedly
filed only on June 22, 2012 and indicates therein that she was an Associate
Justice of the Court when her appointment came only on August 16, 2010;
(g) Her SALNs for 2006 and 2009 did not reflect the fees she received as counsel
for the Republic in the PIATCO cases.
The Bureau of Internal Revenue's (BIR) Report shows that respondent received
from the OSG the total gross amount of P32,494,805.27 as fees from 2004 to 2009
for the PIATCO cases. The BIR Report also shows that she paid the withholding
taxes on said fees in the total amount of Php4,599,504.71. By mathematical
computation, respondent would have had Php27,895,300.56 as her net disposable
income. This net disposable income was not reflected in respondent's SALN for
2006 (which she claims to really be her SALN as of July 27, 2010) nor in her SALN
as of 2009. Her SALN for 2009 revealed net worth of only Php17,936,353.00;
(h) The unaccounted income from the PIATCO cases could not have been due to
losses or liabilities considering that respondent have had an increase in her net
worth from 2002 to 2009. Her SALN for 2002 shows net worth of only
Php3,804,000.00 while her SALN for 2009 shows net worth of Php17,936,353.00,
her net worth thus increased by Php14,132,353.00. While the BIR Report shows
that respondent received approximately Php27M in disposable net income, her
SALN only shows an increase of approximately Php14M in net worth. The
difference between the two, in the amount of estimatedly Php13M, was
conspicuously missing in the SALNs filed by respondent;
(i) There is glaring difference between the two 2010 SALNs filed. The total value of
respondent's personal properties in the "SALN as of July 27, 2010" is
Php9,000,000.00, while the value of her personal properties as declared in her
"SALN as of December 31, 2010" increased to Php11,723,010. Respondent,
therefore, enjoyed an increase of approximately Php2,700,000.00 in personal
properties in just span of five (5) months after having been appointed as Associate
Justice.
j) It is contrary to human experience that the SALNs purportedly recovered by
respondent's husband were not stamped received by the UP HRDO. It is unusual
that respondent did not bother to demand that her personal copy be duly stamped
received with particulars as to the date and initial, at least of the party who
received the same as proof that she timely filed her SALN.
(k) There is no indication from the stamped "Certified Photocopy" and initialed by
Rosemarie Pabiona on the SALNs that she is the official custodian of the same,
and whether the photocopies of the original are on file, contrary to Section 24, Rule
1322 of the Rules of Court.
The above circumstances betray respondent's intention to falsely state material
fact and to practice deception in order to secure for herself the appointment as
Chief Justice. It is therefore clear as day that respondent failed not only in
complying with the physical act of filing, but also committed dishonesty betraying
her lack of integrity, honesty and probity.288
Consistently, the Court does not hesitate to impose the supreme penalty of
dismissal against public officials whose SALNs were found to have contained
discrepancies, inconsistencies and non-disclosures. For instance, in Rabe v.
Flores,289 the Court unanimously imposed the ultimate penalty of dismissal from
service upon regional trial court interpreter with forfeiture of all retirement benefits
and accrued leaves and with prejudice to re-employment for dishonesty and for
failure to disclose her business interest, which was "stall in the market" for
continued period of four years.The Court stressed that it is the obligation of an
employee to submit sworn statement as the "public has right to know" the
employee's assets, liabilities and net worth and financial and business interests.
The dockets of the Sandiganbayan itself show that several charges for violationof
R.A. No. 6713 for failure to file and for untruthful declarations in the SALNs
resulted to plea of guilt from the accused, lest the latter run the risk of being
imprisoned.290 Interestingly, the Sandiganbayan concluded
criminal case291 against certain Rogelio Pureza, then Senior Superintendent of the
Philippine National Police, who was charged with counts of violation of Section in
relation to Section 11 of R.A. No. 6713 for failure to file his annual SALN for the
years 1990, 1991, 1992 and 1993. In the course of the investigation by the Office
of the Deputy Ombudsman for the Military relative to an anonymous letter of
concerned resident of Kalookan City on the alleged illegal activities and
unexplained wealth of several policemen, Pureza was found to have no record of
his SALN from 1989 to 1993 on file with the PNP Records Center. In handing guilty
verdict, the Sandiganbayan reasoned that the non-existence of the SALs with the
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Records Center of the PNP proved that the accused did not file his SAL for 1990 to
1993. The Sandiganbayan observed that even assuming that the accused had
indeed filed his SAL with the PNP and his records were lost during the transfer of
records, he could have easily and conveniently obtained copy of his SAL from
either the CSC or the Office of the Military Ombudsman.
It is thus plainly obvious that the courts do not take violations of the SALN laws
slightly even as against lowly public officials.
With more reason should such test of dishonesty and lack of integrity be applied in
the instant case when respondent failed to file her SALNs for several years and for
those years that she filed, the SALNs so filed prove to be untruthful.
C.
Respondent failed to submit the required SALNs as to qualify for nomination
pursuant to the JBC rules
The JBC required the submission of at least ten SALNs from those
applicants who are incumbent Associate Justices, absent which, the
applicant ought not to have been interviewed, much less been considered
for nomination
Further compounding respondent's woes is the established and undisputed fact
that she failed to submit the required number of SALNs in vjolation of the rules set
by the JBC itself during the process of nomination.
To recall, the announcement for the opening of the application and
recommendation of the position of Chief Justice in 2012 was preceded by JBC En
Bancmeeting where the members thereof agreed that applicants who were
previously in the government service must submit all previous SALNs. This
agreement was reflected in the JBC's announcement published on June 5, 2012,
where it was made clear that applicants from the government shall submit, in
addition to the usual documentary requirements, all previous SALNs, with warning
that those with incomplete or out-of-date documentary requirements will not be
interviewed or considered for nomination.
As extensively quoted, the minutes292 of the JBC deliberation held on July 20,
2012 show that the JBC deliberated on the candidates who submitted incomplete
SALNs and then determined who among them are to be considered as having
"substantially complied." Senator Francis G. Escudero, as then ex officio member,
suggested that "at least an attempt to comply with particular requirement" can be
used as parameter for determining substantial compliance.293
With this, the JBC proceeded to go over, one by one, the compliance of the
candidates with the lacking documentary requirements. For instance, Justice Abad
was considered as having substantially complied because he submitted SALNs in
his year-stint with the OSG and because the filing of the SALN at the time Justice
Abad joined the government was not yet required. Dean Raul C. Pangalangan
lacked SALNs but that he was trying to get them from the Civil Service
Commission and so, regular member Justice Aurora Santiago-Lagman moved that
the SALNs he submitted be considered as substantial compliance. Congressman
Rufus B. Rodriguez did not submit even one SALN which prompted Justice Peralta
to remark that Congressman Rodriguez may no longer be interested.
Commissioner Rene V. Sarmiento also submitted incomplete SALNs, but there
was no mention whether the SALNs he submitted were considered as substantial
compliance. Similarly, for respondent, the JBC determined that she did not submit
her SALNs from 1986 to 2006 and that, as remarked by Senator Escudero, the
filing thereof during those years was already required. There was no indication that
the JBC deemed the three SALNs (for the years 2009, 2010 and 2011) submitted
by respondent for her 20 years as professor in the U.P. College of Law and two
years as Associate Justice, as substantial compliance.
We revisit the pertinent portions of the aforesaid Minutes as follows:
III. Deliberation on Candidates with Incomplete Documentary Requirements:
xxxx
Justice Peralta suggested that the Council examine the matrix per candidate as
follows:
Justice Roberto A. Abad
The Executive Officer reported that Justice Abad lacks the Statement of Assets,
Liabilities and Networth (SALN) for the years 1982-1983.
Justice Peralta mentioned that Justice Abad joined the government in the late
70's and during that time there was no R.A. 6713 yet. He added that Justice
Abad might no longer locate them.
Senator Escudero said that SALNs were not yet required at that time.
The Executive Officer said that Justice Abad had been with the OSG from 1982 to
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1986; but he submitted only his SALNs for the period 1981, 1984, 1985 and
1986. He was already asked to submit the lacking SALNs.
Justice Peralta asked whether there is need for them to explain the reason for
failing to comply with the requirements considering the time constraint.
Senator Escudero said that it would be more proper for the JBC to ask the
candidate for the reason; however, in the case of Justice Abad, he opined that he
substantially complied with the requirements of the JBC.
Justice Lagman agreed with the Senator.
There being no objection, the Council agreed that Justice Abad had
SUBSTANTIALLY COMPLIED with the requirements of the JBC.
xxxx
The Executive Officer asked for clarification, particularly with respect to SALNs,
whether five (5) SALNs would constitute substantial compliance if the candidate
has been in the government service for twenty (20) years.
The Council examined the list with regard to the SALNs, particularly the candidates
corning from the government, and identified who among them, would be
considered to have substantially complied:
1. Justice Arturo D. Brion - has substantially complied;
2. Justice Antonio T. Carpio - has substantially complied;
xxxx
5. Solicitor General Francis H. Jardeleza - has complied;
6. Justice Teresita J. Leonardo-De Castro - has substantially complied;
xxxx
10. Justice Maria Lourdes P.A. Sereno
The Executive Officer informed the Council that she had not submitted her
SALNs for period of ten (10) years, (sic) that is, from 1986 to 2006.
Senator Escudero mentioned that Justice Sereno was his professor at U.P. and
that they were required to submit SALNs during those years.
xxxx
16. Atty. Ronaldo B. Zamora has lacking SALNs and MCLE cert.
xxxx
From the foregoing discourse, it appears that respondent was specifically singled
out from the rest of the applicants for having failed to submit single piece of SALN
for her years of service in the U.P. College of Law. This is in obvious contrast with
the other shortlisted applicants who submitted SALNs, or whose years in
government service correspond to the period prior to the effectivity of R.A. No.
6713.
The minutes of the JBC En Banc meeting also show that Senator Escudero moved
that the determination of whether candidate has substantially complied with the
requirements be delegated to the Executive Committee.294 In the end, it appears
that the JBC En Banc decided to require only the submission of the past ten (10)
SALNs, or from 2001-2011, for applicants to the Chief Justice position.295 This, as
much, was confirmed by Atty. Pascual during the Congressional hearings. 296
From the foregoing, it is clear that the JBC En Banc did not do away with the
requirement of submission of SALNs, only that substantial compliance
therewith, i.e., the submission of the SALNs for the immediately preceding 10
years instead of all SALNs, was deemed sufficient.
Conformably thereto, the following candidates submitted their respective letters as
regards the submission of the SALNs:
(a) Justice De Castro submitted letter297 dated July 17, 2012 with the attached
SALNs for 16 years covering the period 1997 to 2011, from the time she became
an Associate Justice of the Sandiganbayan on September 23, 1997 until
December 2011 as Associate Justice of the Supreme Court. She also disclosed
that her SALN from February 19, 1973 until November 30, 1978 which she filed
during her employment in the Supreme Court, could no longer be located. She
also disclosed that her personal files, including her SALNs that she filed while
employed at the Department of Justice from December 1, 1978 to September 22,
1997, were among those burned when the third floor of the DOJ was gutted by fire
in late 1996 or early 1997. In any case, upon inquiry from the CSC, she was told
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that her SALNs filed as DOJ employee were already disposed of, as it was way
beyond the statutory ten (10) year period.
(b) Jose Manuel Diokno submitted sworn and verified statement298 dated July 17,
2012, stating therein that while he served as General Counsel of the Senate Blue
Ribbon Committee and as Special Counsel to the Board of Directors of the
Development [Bank] of the Philippines, his engagement was only as consultant on
contractual basis and as such, was not required to file SALN.
(c) Justice Carpio submitted letter299 dated July 23, 2012 stating that he resigned
as Chief Presidential Legal Counsel effective January 31, 1996 and as such, he
did not submit SALN for the year 1995 because the submission for that year was
on April 30, 1996 when he was no longer employed with the government.
Nevertheless, the clearance issued by the Office of the President certifies that
Justice Carpio has submitted his SALN and that he has no pending criminal or
administrative case.
(d) Justice Abad submitted an attestation300 dated July 23, 2012 that he does not
have copy of his SALNs for the years 1968 to 1974, 1976 to 1980 and 1982 to
1983.
(e) Dean Amado Valdez wrote letter301 dated July 23, 2012 saying that he could no
longer find the SALNs covering the years 1985 to 1987, 2002 to 2003 and 2004
representing the years of his intermittent government service. He said that in, any
case, the assets reflected in the SALN which he already filed were acquired after
he left government service as shown by his income tax returns for the periods from
2005 to 2011.
Notably, Jose Manuel Diokno and Dean Amado Valdez were not included in the
short list.
That such was the standing requirement of the JBC from at least the incumbent
Associate Justices applying for the position of Chief Justice is evident from the fact
that five (5) out of six (6) applicants who were incumbent Associate Justices,
namely: (1) Justice Carpio; (2) Justice Brion; (3) Justice Velasco; and (4) Justice
De Castro were determined to have completely complied with the SALN
requirement; and (5) Justice Abad was determined to have substantially complied.
These Justices submitted the following numbers of SALNs:302
Justice Carpio 14 SALNs
Justice Brion 12 SALNs
Justice Velasco 19 SALNs
Justice Leonardo-De Castro 15 SALNs
Justice Abad 7 SALNs
This belies respondent's representation that the JBC maintained its requirement
that the candidates submit all previous SALNs. If such were the case, only those
candidates determined to have complied should have been shortlisted, and the
others, including respondent, should not have qualified. In any case, the
requirement of submitting SALNs within the ten-year period instead of all previous
SALNs is more in keeping with the law. Recall that Section 8, paragraph C(4) of
R.A. No. 6713 provides that the filed SALNs need not be retained by the receiving
officer or the custodian after more than ten years from the filing or receipt thereof,
and actually allows such documents to be destroyed unless needed in an ongoing
investigation.
Be that as it may, records clearly show that the only remaining applicant-
incumbent Justice who was not determined by the JBC En Banc to have
substantially complied was respondent, who submitted only SALNs, i.e., 2009,
2010 and 2011, even after extensions of the deadline for the submission to do so.
Instead of complying, respondent offered, by way of her letter dated July 23,
2012, justifications why she should no longer be required to file the SALNs: that
she resigned from U.P. in 2006 and then resumed government service only in
2009, thus her government service is not continuous; that her government records
are more than 15 years old and thus infeasible to retrieve; and that U.P. cleared
her of all academic and administrative responsibilities and charges.
These justifications, however, did not obliterate the simple fact that respondent
submitted only SALNs in her 20-year service in U.P., and that there was nary an
attempt on respondent's part to comply.
Respondent sought to be excused from complying with the SALN requirement
because, allegedly, the SALNs requested from her (1995-1999 as respondent
alleged) from U.P., are old and thus "infeasible to retrieve." But the Republic,
through the OSG, was able to present before the Court copies of respondent's
SALNs for 1985, 1990, 1991, 1993, 1994, 1995, 1996, 1997, and 2002 from the
U.P. HRDO. These files, therefore, are not "infeasible to retrieve." Also, in
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comparison with the other nominees, the SALNs which the latter could no longer
produce are much older in age than the SALNs which respondent regarded as
"infeasible to retrieve". For instance, Justice Abad had no copy of his SALN from
1968-1974, 1976-1980 and 1981-1983 while Justice Leonardo-De Castro had no
copy of her SALNs from 1973-1978.
Respondent likewise sought special treatment as having complied with the
submission of the SALN by submitting Certificate of Clearance issued by the U.P.
HRDO. This clearance, however, hardly suffice as substitute for SALNs. The
import of said clearance is limited only to clearing respondent of her academic and
administrative responsibilities, money and property accountabilities and from
administrative charges as of the date of her resignation on June 1, 2006. But such
could not, by any stretch of imagination, be considered as compliance with the
SALN requirement. Obviously, an administrative officer, performing ministerial and
administrative duties, could not have certified respondent's compliance with the
filing of SALNs which is statutory, and not merely an administrative, requirement.
In all these, respondent curiously failed to mention that she, in fact, did not file
several SALNs during the course of her employment in U.P. Such failure to
disclose material fact and the concealment thereof from the JBC betrays any claim
of integrity especially from Member of the Supreme Court. On this score, the
observations of the Court in the case of OCA v. Judge Estacion, Jr.303 ring special
significance:
He concealed from the appointing authority, at the time he applied for the judicial
post until his appointment, information regarding the criminal charges for homicide
and attempted homicide filed against him. Such fact would have totally eluded the
Court had it not been complained of by one Mrs. Ruth L. Vda. de Sison who,
incidentally, is the mother of one of the victims. x x x
xxxx
x x x Respondent did not honestly divulge all that the appointing authority ought to
know to correctly discern whether he is indeed fit for the judicial post. He
continuously suppressed vital information on his personal circumstances under the
false belief that he can mislead the Court and get away with it for good. What
respondent did, or omitted to do, was calculated deception committed not only
against the Court but against the public as well, clearly indicative of his lack of
moral rectitude to sit as magistrate, and sufficiently repulsive that it detracts from
public confidence in the integrity of the judiciary. Dismissal indeed is the
appropriate retribution for such kind of transgression.
Be it stressed that judges are held to higher standards of integrity and ethical
conduct than attorneys or other persons not invested with the public trust. They
should inspire trust and confidence, and should bring honor to the judiciary. And
because of their critical position in the judicial bureaucracy, this Court as overseer
is duty-bound to insure that the integrity of the judicial system is preserved and
maintained, by pursuing that ever-vigilant search for the virtues of competence,
integrity, probity and independence mandated by no less than the Constitution
itself.304 (Citations omitted)
Indubitably, respondent not only failed to substantially comply with the submission
of the SALNs but there was no compliance at all. The contents of respondent's
Letter dated July 23, 2012 itself betray an exercise of dishonesty and disposition to
deceive in an attempt to secure for herself the appointment as Chief Justice.
In Ombudsman v. Peliño,305 We held:
Under the laws governing civil service, dishonesty is classified as grave offense
the penalty of which is dismissal from the service at the first infraction. person
aspiring to public office must observe honesty, candor anq faithful compliance with
the law. Nothing less is expected. This ideal standard ensures that only those of
known probity, competence and integrity are called to the challenge of public
service. It is understood to imply disposition to lie, cheat, deceive, or defraud;
untrustworthiness; lack of integrity; lack of honesty, probity or integrity in principle;
lack of fairness and straightforwardness; disposition to defraud, deceive or betray.
Dishonesty is malevolent act that puts serious doubt upon one's ability to perform
his duties with the integrity and uprightness demanded of public officer or
employee.306
For these reasons, the JBC should no longer have considered respondent for
interview as it already required the submission of, at least, the SALNs
corresponding to the immediately preceding 10 years up to December 31, 2011.
Parenthetically, the Court observes that the circumstances surrounding the receipt
of, and the action or non-action of the JBC, on respondent's Letter dated July 23,
2012 likewise leave much to be desired. The Letter, while ostensibly sent to and
received by the JBC on the same date, does not appear to have been brought to
the attention of the JBC En Banc. Excerpts307 from the Report of the House
Committe on Justice on this point is revealing:
Justice Peralta, who was acting Chief Justice and ex officio Chairman of the JBC
at the time, testified that he never learned about the non-submission of the SALNs
by then-applicant [respondent], and that he also never saw the letter submitted by
the [r]espondent explaining why she could not submit her SALNs. He stated that
had he known about these matters, he could have raised these issues during the
en banc meeting of the JBC. Atty. [Maria Milagros N. Fernan-]Cayosa likewise
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stated that she never saw the letter-explanation, and that she merely relied on the
matrix prepared by the JBC Secretariat which stated that the Respondent Chief
Justice Sereno had already submitted her complete requirements.308
Even the JBC's Execom to which the duty of ascertaining whether or not the
candidates have substantially complied with the documentary requirements had
been expressly delegated by the JBC En Banc, could not produce any minutes of
meeting or record to show that respondent was in fact determined to have
complied.
At any rate, the issue of whether or not there is administrative culpability in the
ranks of the JBC, the OEO or the ORSN relative to the nomination of respondent
in 2012 is not concern in the instant petition and is matter best left to be decided in
A.M. No. 17-11-12-SC and A.M. No. 17-11-17-SC, now pending before the Court.
Respondent's failure to submit to the JBC her SALNs for several years
means that her integrity was not established at the time of her application
Respondent argues that failure to submit the SALNs to the JBC is not cause for
disqualification because the SALN was not among the documents which the JBC
considered as evidence of integrity.
This Court, again, disagrees.
The requirement to submit SALNs is made more emphatic when the applicant is
eyeing the position of the Chief Justice. The minutes of the JBC En
Bancmeeting309 enlightens as to the rationale behind the requirement:
Senator Escudero moved that additional requirements be imposed by the (JBC) for
the position of Chief Justice, namely (1) all previous SALNs (up to December 31,
[2011]) for those in the government or SALN as of December 31, (2011) for those
from the private sector; and (2) waiver in favor of the JBC of the confidentiality of
local and foreign currency bank accounts under the Bank Secrecy Law and
Foreign Currency Deposits Act. The documents shall be treated with utmost
confidentiality and only for the use of the JBC. He proposed that these additional
requirements be included in the publication of the announcement opening the said
position. He explained that the basis of his motion was the fact that the
reason why Chief Justice Corona was removed from office was due to
inaccuracies in his SALN. The Members of the House of Representatives, in
the exercise of their wisdom, determined that non-inclusion of assets in
one's SALN is an impeachable offense. Likewise, majority of the Senate
voted to convict because of the inaccuracies in the bank accounts and
statements in his SALN. He said that the JBC would not want to recommend
person who is susceptible to such kind of attack. He said that the JBC
should impose higher standards to aspirants for the position of Chief
Justice.
Congressman Tupas concurred with Senator Escudero's motion and suggested
that the waiver should not be limited to year-end balances only.
There being no objection, the motion was APPROVED. The (JBC) agreed to
PUBLISH the announcement opening the position of Chief Justice of the Supreme
Court of the Philippines together with the additional requirements.
x x x. (Emphasis ours)
The requirement to submit the SALNs along hand with the waiver of bank deposits,
is therefore not an empty requirement that may easily be dispensed with, but was
placed by the JBC itself for reason in order to allow thJBC to carry on its mandate
of recommending only applicants of high standards and who would be
unsusceptible to impeachment attacks due to inaccuracies in SALNs.
Further, the failure to submit the required SALNs means that the JBC and the
public are divested of the opportunity to consider the applicant's fitness or
propensity to commit corruption or dishonesty. In respondent's case, for example,
the waiver of the confidentiality of bank deposits would be practically useless for
the years that she failed to submit her SALN since the JBC cannot verify whether
the same matches the entries indicated in the SALN. This is precisely the reason
why the JBC required the submission of the SALNs together with the waiver of
bank deposits, thus:
Justice Lagman expressed that previously the Members had agreed that they
would only use the waiver when there is complaint, doubt, or suspicion on the
SALN of any of the candidates.
Senator Escudero said that if the argument that the JBC would not use the waiver
unless there is complaint, bank information could not be secured. The complaint
could have no basis. He commented that by the time the JBC receives the
information, the public interview is finished. In this case, the least that the JBC
could do is to give the candidate an opportunity to explain his side. He explained
that the theory and logic behind the requirement of waiver was precisely due
to the fact that the former Chief Justice was impeached because of
inaccuracies in his SALN. Thus, the JBC should ensure that all the nominees
who would be nominated would not be accused of the same. The JBC would
just want to avoid situation where the next Chief Justice, nominated by the
JBC and appointed by the President, would again be subjected to
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impeachment.
Justice Peralta asked the Senator for clarification whether it is his suggestion that if
the JBC finds something wrong on the bank account of any candidate, he or she
would be asked in public.
Senator Escudero replied that it could be done; however, in the questions that
would be propounded by Member, or in the response of the candidates, the
amounts need not be stated. The questions should only tackle inconsistencies
of bank deposits as against their SALNs.
Justice Lagman agreed with the Senator.
xxxx
Justice Hermosisima commented that the waiver is very easy to comply with. The
problem is that banks may not be able to respond given the very short period of
time. He said that the JBC requires waiver so that in the event that there is any
question as to the accuracy of candidate's accounting in his or her SALN, then, the
JBC would be able to look into the bank accounts without violating the bank
secrecy law. He said that the JBC need not look into their accounts for now as no
complaint has been filed yet on any of the candidates.
Senator Escudero and Congressman Tupas commented that everybody
should comply.
x x x.310 (Emphasis ours)
Respondent is presumed to know of the importance of the filing of the SALN
together with the bank waiver. The waiver which respondent executed under oath
clearly provides:
This waiver is executed on the condition that the JBC or its duly authorized
representatives shall make use of it, as well as any and all information or data
obtained by virtue thereof, for the exclusive and sole purpose of evaluating my
qualifications for the position of Chief Justice of the Supreme Court.
(Emphasis ours)
Conclusively then, respondent's failure to submit her SALNs to the JBC means
that she was not able to prove her integrity at the time of her application as Chief
Justice.
D.
Respondent's disposition to commit deliberate acts and omissions
demonstrating dishonesty and lack of forthrightness is discordant with any
claim of integrity
The Court cannot play blind against the manifest inconsistencies, lack of
forthrightness and dishonesty committed by respondent as government official
prior to and at the time of her application as Chief Justice. In addition to the
suspicious and highly questionable circumstances surrounding the execution of
her SALNs, the following untruthful statements and dishonest acts (as herein
elsewhere discussed) ultimately negate respondent's claim that she is person of
proven integrity:
(1) Respondent had no permit from U.P. to engage in private practice while in
government service but she did engage in private practice as shown in her PDS
and admitted in her Ad Cautelam Comment;
(2) Respondent represented that after her resignation from U.P. in 2006, she was
engaged, full time, in private practice. However, in her PDS, it was stated that she
was engaged as counsel by the government in the PIATCO cases from 1994 up to
2009;
(3) Respondent claims that the clearance issued by U.P., clearing her of
academic/administrative responsibilities, money and property accountabilities and
from administrative charges as of June 1, 2006 can be taken as an assurance that
U.P. considered the SALN requirements to have been met since it is the ministerial
duty of the Head of the Office to ensure that the SALNs of its personnel are
properly filed and accomplished. However, this ministerial duty of U.P. HRDO to
call her attention as regards compliance with the SALN requirements was imposed
only in April 2006 (CSC Resolution No. Memorandum Circular No. 10-2006 dated
April 17, 2006) as stated in her Letter. Hence, the U.P. HRDO could not have been
expected to perform its ministerial duty of issuing compliance orders to respondent
when such rule was not yet in existence at that time;
(4) Her PDS shows that she was Deputy Ca,mmissioner of the Commission on
Human Rights only later to be disclaimed by her during the Oral Argument stating
that it was only functional title;
(5) In her Letter dated July 23, 2012 to the JBC, respondent represented that her
SALNs were infeasible to retrieve when the SALNs that she selectively filed were
available all along in U.P. and in fact the OSG was able to get copies of the same.
Even respondent herself was able to get copy of her 1989 SALN from U.P.;
Page 274 of 507
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 Q4 1,387,292.12 1,246,992.00 -140,300.12
(6) There is marked incompatibility between the excuse respondent proffered in
her Letter dated July 23, 2012, and the explanation she gave in the Oral Argument.
2007
In the Letter, the respondent reasoned that it is "infeasible to retrieve" all her
SALNs because of the age of said documents, i.e., that they are more than fifteen
Q1 - 2,620,340.17 2,620,340.17
years old. However, during her Oral Arguments, she explained that it was
"infeasible" to retrieve them only because of time constraints; Q2 - -
(7) She claims that the other candidates for the Chief Justice position did not Q3 4,379,198.29 2,183,529.33 -2,195,668.96
comply with the SALN requirement for the application, when it was only she who
did not comply. Out of the six incumbent Justices who were candidates for the Q4 633,670.58 - -633,670.58
Chief Justice positions, it was only respondent who did not comply with SALN
submission. There are competent proofs on record to show these other 2008
candidates' compliance, contrary to respondent's allegations.
Q1 - 2,650,440.00 2,650,440.00
(8) Respondent committed tax fraud when she failed to truthfully declare her
income in her income tax returns for the years 2007-2009 and in her value-added Q2 - -
tax (VAT) returns for the years 2005-2009;
Q3 - 508,032.00 508,032.00
Per the BIR Report,311 respondent underdeclared her income in her quarterly VAT
Returns the following amounts in the taxable years 2005-2009: Q4 5,184,435.85 1,045,262.67 -4,139,173.19

2009
Quarterly Income Declared Income
Over (Under)
Period from PIATCO Case per VAT Return
(Php) Q1 344,243.65 301,552.00 -42,691.65
(Php) (Php)
Total Undeclared
2005
Income Subject -16,656,980.39
to VAT
Q3 1,398,807.50 - -1,398,807.50
On this matter, respondent avers in her Reply/Supplement to the Memorandum Ad
Q4 7,234,455.44 667,333.33 -6567122.11 Cautelam that she was not given the chance to be heard on this new matter in the
Republic's Memorandum, which makes reference to new documents, totally alien
2006 to and outside of the matters raised in the Republic's Petition, Reply, and other
previous submissions.
Q1 - 469,375.00 469,375.00
There is no truth to the allegation that respondent was not afforded the opportunity
Q2 - 1,416,664.25 1,416,664.25 to address this matter or that this matter is "totally alien" to this proceedings. This
matter was actually brought up during the Oral Argument. In its Memorandum, the
Q3 1,539,546.28 - -1,539,546.28 Republic explained that during the Oral Argument, some Members of the Court
raised questions regarding respondent's income as counsel in the PIATCO cases
and the payment of the corresponding taxes thereto, hence, the inclusion of the
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Cases – Special Civil Actions (Part 1)
same in its Memorandum.312 In the same way, respondent could have addressed
the same in her Memorandum Ad Cautelam, instead she opted to do so in
belatedly filed Reply/Supplement to the Memorandum Ad Cautelam.
At any rate, respondent's argument in the said Reply/Supplement, implying that
the allegations on the tax fraud are unfounded, and that in including this matter,
which is mere reiteration of the discussion in Article of the Articles of
Impeachment, the OSG usurped the sole power of the House of Representatives
to initiate and prosecute the Articles of Impeachment in blatant disregard of the
Constitution,313 deserve scam consideration.
It bears stressing that respondent is not being prosecuted for tax fraud in this case.
The Court did not discuss the merits of the said tax fraud nor did the Court made
any conviction against the respondent as regards the said offense. Neither is this
Court's finding of respondent's lack of proven integrity during her application
anchored upon this act. This matter is cited as corroborative circumstance to
respondent's non-filing of certain SALNs, already established in this case. Notably,
the Congress had already determined that probable cause exist that respondent
committed the said offense.
Further, respondent's disposition and propensity to commit dishonesty and lack of
candidness are manifested through her subsequent acts committed during her
incumbency as Chief Justice, which are now matters of public record and also
determined to be constituting probable cause for impeachment:
(9) Caused the procurement of brand-new Toyota Land Cruiser worth at least
Php5,000,000.00;
(10) Caused the hiring of Ms. Helen Macasaet without the requisite public bidding
and who received excessive compensation amounting to more than
Php11,000,000.00;
(11) Misused at least Php3,000,000.00 of government funds for hotel
accommodation at Shangri-La Boracay as the venue of the 3rd ASEAN Chief
Justices meeting;
(12) Created the Judiciary Decentralized Office (JDO) in the guise of reopening the
Regional Court Administration Office (RCAO) without being sanctioned by the
Court En Banc;
(13) Issued Temporary Restraining Order (TRO) in Coalition of Associations of
Senior Citizens in the Philippines v. COMELEC contrary to the Supreme Court's
internal rules an misrepresented that the TRO was issued upon the
recommendation of the Member-in-charge;
(14) Manipulated the disposition of the DOJ request to transfer the venue of the
Maute cases outside of Mindanao;
(15) Ignored rulings of the Supreme Court with respect to the grant of survivorship
benefits which caused undue delay to the release of survivorship benefits to
spouses of deceased judges and Justices;
(16) Appointed Geraldine Econg as Head of the JDO and Brenda Jay Angeles-
Mendoza as Chief of the Philippine Mediation Center Office (PMCO) without the
approval of the Court En Banc;
(17) Failed and refused to appoint qualified applicants to several high-ranking
positions in the Supreme Court;
(18) Ordered the dissemination of erroneous information on what transpired during
the Supreme Court En Banc deliberations in A.M. No. 16-08-04-SC on the alleged
involvement of four (4) incumbent judges in illegal drugs and undermined the co-
equal power of the Executive Department by ordering the Executive Secretary
himself to file cases against the judges;
(19) Manipulated the processes of the JBC to exclude then Solicitor General, now
Associate Justice Francis Jardeleza, by using highly confidential document
involving national security against the latter;
(20) Clustered the nominees for the six (6) vacant positions of Associate Justice in
the Sandiganbayan without legal basis and in so doing, impaired the power of the
President to appoint members of the Judiciary;
(21) Misrepresented to the members of the Supreme Court En Banc that there
were Justices who requested to do away with the voting of recommended
applicants to the vacant positions in the Supreme Court;
(22) Manipulated the processes of the JBC to exclude Court of Appeals Associate
Justice Fernanda Lampas-Peralta from the shortlist of nominees for the position of
Presiding Justice of the Court of Appeals;
(23) Interfered with the investigation conducted by the House of Representatives
on the alleged misuse of the tobacco funds in the Province of Ilocos Norte by
Page 276 of 507
Cases – Special Civil Actions (Part 1)
unilaterally preparing Joint Statement, asking the House of Representatives to
reconsider its show cause order against the Justices of the Court of Appeals, and
then pressuring then Presiding Justice of the Court of Appeals, now Associate
Justice Andres B. Reyes, Jr. to likewise sign the same;
(24) Undermined and disrespected the impeachment proceedings conducted by
the House of Representatives against her.314
Again, while concedingly the foregoing acts as revealed during the Congressional
hearings on the impeachment are not proper subjects of the instant quo
warranto petition, these acts are nevertheless reflective and confirmatory of
respondent's lack of integrity at the time of her nomination and appointment as
Chief Justice and her inability to possess such continuing requirement of integrity.
Indeed, Rule 130, Section 34 of the Rules on Evidence provide:
SEC. 34. Similar acts as evidence. Evidence that one did or did not do certain
thing at one time is not admissible to prove that he did or did not do the same or
similar thing at another time; but it may be received to prove specific inent or
knowledge, identity, plan, system, scheme, habit, custom or usage, and the
like. (Emphasis ours)
E.
Respondent's ineligibility for lack of proven integrity cannot be cured by her
nomination and subsequent appointment as Chief Justice
The Court is all too aware that the instant petition neither partakes of an
administrative or criminal proceeding meant to determine culpability for failure to
file SALNs. Respondent maintains that she filed ail her SALNs, only that she
refuses to present proof of such SALNs before the Court. The Court's
pronouncement, however, should not be made dependent upon the pieces of
evidence which party may possibly present in different forum. Rather, the Court is
mandated to render judgment based on the evidence presented before it, in
compliance with the dictates of due process. And the evidence, as it stands before
Us, shows that respondent failed to file nine SALNs in her 20-year service in U.P.
College of Law and submitted to the JBC only three out of the required ten SALNs
at the time of her application as Chief Justice.
Respondent split hairs in stating that failure to file is different from failure to submit
the SALNs to the JBC. That may be true. But it is likewise true that despite ample
opportunity to do so, respondent chose not to present evidence as to preponderate
the case in her favor. The Court cannot therefore be faulted, at least for purposes
of the instant quo warranto proceedings, to conclude that respondent not only
failed to submit the SALNs to the JBC, but altogether failed to file the same.
Such failure to file and to submit the SALNs to the JBC, is clear violation not only
of the JBC rules, but also of the law and the Constitution. The discordance
between respondent's non-filing and non-submission of the SALNs and her
claimed integrity as person is too patent to ignore. For lack of proven integrity,
respondent ought to have been disqualified by the JBC and ought to have been
excluded from the list of nominees transmitted to the President. As the qualification
of proven integrity goes into the barest standards set forth under the Constitution
to qualify as Member of the Court, the subsequent nomination and appointment to
the position will not qualify an otherwise excluded candidate. In other words, the
inclusion of respondent in the shortlist of nominees submitted to the President
cannot override the minimum Constitutional qualifications.
Well-settled is the rule that qualifications for public office must be possessed at the
time of appointment and assumption of office and also during the officer's entire
tenure as continuing requirement.315 When the law requires certain qualifications to
be possessed or that certain disqualifications be not possessed by persons
desiring to serve as public officials, those qualifications must be met before one
even becomes candidate.316
The voidance of the JBC nomination as necessary consequence of the Court's
finding that respondent is ineligible, in the first place, to be candidate for the
position of Chief Justice and to be nominated for said position follows as matter of
course. The Court has ample jurisdiction to do so without the necessity of
impleading the JBC as the Court can take judicial notice of the explanations from
the JBC members and the OEO, as regards the circumstances relative to the
selection and nomination of respondent submitted to this Court in A.M. No. 17-11-
12 and A.M. No. 17-11-17-SC. Relatedly, the Court, in quo warrantoproceeding,
maintains the power to issue such further judgment determining the respective
rights in and to the public office, position or franchise of all the parties to the
action as justice requires.317
Neither will the President's act of appointment cause to qualify respondent.
Although the JBC is an office constitutionally created, the participation of the
President in the selection and nomination process is evident from the composition
of the JBC itself. The regular members of the JBC are appointees of the President,
including an ex officio member, the Secretary of Justice, who serves as the
President's alter ego. As observed during the deliberations of the 1986
Constitutiopal Commission:
xxxx
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MR. CONCEPCION. The Judicial and Bar Council is no doubt an innovation. But it
is an innovation made in response to the public clamor in favor of eliminating
politics in the appointment of judges.
At present, there will be about 2,200 positions of judges, excluding those of the
Supreme Court, to be filled. We feel that neither the President alone nor the
Commission on Appointments would have the time and the means necessary to
study the background of every one of the candidates for appointment to the
various courts in the Philippines, specially considering that we have accepted this
morning the amendment to the effect that no person shall be qualified unless he
has proven high sense of morality and probity. These are matters that require time,
which we are sure the President does not have except, probably, he would have to
endorse the matter to the National Bureau of Investigation or to some intelligence
agency of the government. And we do not think that these agencies are qualified to
pass upon questions of morality, integrity and competence of lawyers.
As regards the implication that we are, in effect, depriving the President of the
power of appointment, all we do consider is the fact that the members of the
Council are all appointees of the President. They are alter egos of the President
so, in effect, they are exercising the power by virtue of the appointment by the
President. So, the alleged negation or denial or emasculation of the appointing
power of the President does not really exist since all members of the Council,
except those who are ex officio members who, by the way, are also appointees of
the President, are all appointees of the President.
In effect, the action of the JBC, particularly that of the Secretary of Justice as ex
officio member, is reflective of the action of the President. Such as when the JBC
mistakenly or wrongfully accepted and nominated respondent, the President,
through his alter egos in the JBC, commits the same mistake and the President's
subsequent act of appointing respondent cannot have any curative effect.
Besides in Luego v. Civil Service Commission,318 We said:
Appointment is an essentially discretionary power and must be performed by the
officer in which it is vested according to his best lights, the only condition being
that the appointee should possess the qualifications required by law. If he
does, then the appointment cannot be faulted on the ground that there are others
better qualified who should have been preferred. This is political question involving
considerations of wisdom which only the appointing authority can decide.
(Emphasis ours)
As emphasized in Central Bank v. Civil Service Commission:319
It is well-settled that when the appointee is qualified, as in this case, and all
the other legal requirements are satisfied, the Commission has no alternative
but to attest to the appointment in accordance with the Civil Service Law. The
Commission has no authority to revoke an appointment on the ground that another
person is more qualified for particular position. It also has no authority to direct the
appointment of sub'stitute of its choice. To do so would be an encroachment on
the discretion vested upon the appointing authority. An appointment is
essentially within the discretionary power of whomsoever it is vested,
subject to the only condition that the appointee should possess the
qualifications required by law. (Emphasis ours)
Thus, while the Court surrenders discretionary appointing power to the President,
the exercise of such discretion is subject to the non-negotiable requirements that
the appointee is qualified and all other legal requirements are satisfied, in the
absence of which, the appointment is susceptible to attack.
Even as respondent took her "oath of office," she remains disqualified. An oath of
office is qualifying requirement for public office and prerequisite to the full
investiture of the office.320 The oath, couched in the following tenor, states:
Ako ay taimtim na nanunumpa na tutuparin ko nang buong husay at katapatan, sa
abot ng aking kakayahan, ang mga tungkulin ng aking kasalukuyang katungkulan
at ng mga iba pang pagkaraan nito gagampanan ko sa ilalim ng Republika ng
Pilipinas, na aking itataguyod at ipagtatanggol ang Saligang Batas ng Pilipinas; na
tunay na mananalig at tatalima ako rito; na susundin ko ang mga batas, mga
kautusang legal, at mga dekretong pinaiiral ng mga sadyang itinakdang may
kapangyarihan ng Republika ng Pilipinas; at kusa kong babalikatin ang
pananagutang ito nang walang ano mang pasubali hangaring umiwas.
Kasihan nawa ako ng Diyos.
As respondent herself expressed through her dissent in Philippine Savings
Bank, "[w]hen public officer affixes his signature on his Oath of Office, he
embraces all his constitutional and statutory duties as public officer, one of which
is the positive duty to disclose all of his assets and liabilities. Thus, for all public
officers, what is absolute is not the confidentiality privilege, but the obligation
of disclosure."321
While respondent putatively took an oath to defend and support the Constitution
and to obey the laws of the land, she had not been forthright with the
circumstances surrounding the lacking SALNs. This makes her oath untruthful and
altogether false.
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 F.
Respondent is de facto officer removable through quo warranto
The effect of finding that person appointed to an office is ineligible therefor is that
his presumably valid appointment will give him color of title that confers on him the
status of de facto officer.322
Tayko v. Capistrano,323 through Justice Ostrand, instructs:
Briefly defined, de facto judge is one who exercises the duties of judicial office
under color of an appointment or election thereto x x x. He differs, on the one
hand, from mere usurper who undertakes to act officially without any color of right,
and on the others hand, from judge de jure who is in all respects legally appointed
and qualified and whose term of office has not expired x x x. (Citations omitted)
For lack of Constitutional qualification, respondent is ineligible to hold the position
of Chief Justice and is merely holding colorable right or title thereto. As such,
respondent has never attained the status of an impeachable official and her
removal from the office, other than by impeachment, is justified. The remedy,
therefore, of quo warranto at the instance of the State is proper to oust respondent
from the appointive position of Chief Justice. Tayko continues:
The rightful authority of judge, in the full exercise of his public judicial functions,
cannot be questioned by any merely private suitor, nor by any other, excepting in
the form especially provided by law. judge de facto assumes the exercise of part of
the prerogative of sovereignty, and the legality of that assumption is open to the
attack of the sovereign power alone. Accordingly, it is well established principle,
dating from the earliest period and repeatedly confirmed by an unbroken current of
decisions, that the official acts of de facto judge are just as valid for all purposes as
those of de jure judge, so far as the public or third persons who are interested
therein are concerned. The rule is the same in civil and criminal cases. The
principle is one founded in policy and convenience, for the right of no one claiming
title or interest under or through the proceedings of an officer having an apparent
authority to act would be safe, if it were necessary in every case to examine the
legality of the title of such officer up to its original source, and the title or interest of
such person were held to be invalidated by some accidental defect or flaw in the
appointment, election or qualification of such officer, or in the rights of those from
whom his appointment or election emanated; nor could the supremacy of the laws
be maintained, or their execution enforced, if the acts of the judge having
colorable, but not legal title, were to be deemed invalid. As in the case of judges of
courts of record, the acts of justice de facto cannot be called in question in any suit
to which he is not party. The official acts of de facto justice cannot be attacked
collaterally. An exception to the general rule that the title of person assuming to act
as judge cannot be questioned in suit before him in generally recognized in the
case of special judge, and it is held that party to an action before special judge
may question his title to the office of judge on the proceedings before him, and that
the judgment will be reversed on appeal, where proper exceptions are taken, if the
person assuming to act as special judge is not judge de jure. The title of de facto
officer cannot be indirectly questioned in proceeding to obtain writ of prohibition to
prevent him from doing an official act nor in suit to enjoin the collection of judgment
rendered by him. Having at least colorable right to the officer his title can be
determined only in quo warranto proceeding or information in the nature of quo
warranto at suit of the sovereign. (Citation omitted)
Although Tayko dealt with challenge to the title of judge, who is not an
impeachable official, the ruling therein finds suitable application since quo
warrantoas remedy is available against respondent who is de facto Chief Justice,
having mere colorable right thereto. This must necessarily be so since the
Constitution, in providing that impeachable officials can only be removed by
impeachment, presumes that such impeachable official is one having de juretitle to
the office.
Upon finding that respondent is in fact ineligible to hold the position of Chief
Justice and is therefore unlawfully holding and exercising such public office, the
consequent judgment under Section 9, Rule 66 of the Rules of Court is the ouster
and exclusion of respondent from holding and exercising the rights, functions and
duties of the Office of the Chief Justice.
IV.
Guidelines for the Bench, the Bar and the JBC
The present is the exigent and opportune time for the Court to establish well-
defined guidelines that would serve as guide posts for the bench, the bar and the
JBC, as well, in the discharge of its Constitutionally mandated functions. In sum,
this Court holds:
Quo warranto as remedy to oust an ineligible public official may be availed of,
provided that the requisites for the commencement thereof are present, when the
subject act or omission was committed prior to or at the time of appointment or
election relating to an official's qualifications to hold office as to render such
appointment or election invalid. Acts or omissions, even if it relates to the
qualification of integrity being continuing requirement but nonetheless committed
during the incumbency of validly appointed and/or validly elected official cannot be
the subject of a quo warranto proceeding, but of impeachment if the public official
concerned is impeachable and the act or omission constitutes an impeachable
offense, or to disciplinary, administrative or criminal action, if otherwise.
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Members of the Judiciary are bound by the qualifications of honesty, probity,
competence, and integrity. In ascertaining whether candidate possesses such
qualifications, the JBC in the exercise of its Constitutional mandate, set certain
requirements which should be complied with by the candidates to be able to
qualify. These requirements are announced and published to notify not only the
applicants but the public as well. Changes to such set of requirements, as agreed
upon by the JBC En Banc through proper deliberation, such as in this case when
the JBC decided to allow substantial compliance with the SALN submission
requirement, should also be announced and published for the same purpose of
apprising the candidates and the public of such changes. At any rate, if candidate
is appointed despite being unable to comply with the requirements of the JBC and
despite the lack of the aforementioned qualifications at the time of application, the
appointment may be the subject of quo warranto provided it is filed within one year
from the appointment or discovery of the defect. Only the Solicitor General may
institute the quo warranto petition.
The willful non-filing of SALN is an indication of dishonesty, lack of probity and lack
of integrity. Moreso if the non-filing is repeated in complete disregard of the
mandatory requirements of the Constitution and the law.
Consistent with the SALN laws, however, SALNs filed need not be retained after
more than ten years by the receiving office or custodian or repository unless these
are the subject of investigation pursuant to the law. Thus, to be in keeping with the
spirit of the law requiring public officers to file SALNs to manifest transparency and
accountability in public office if public officers cannot produce their SALNs from
their personal files, they must obtain certification from the office where they filed
and/or the custodian or repository thereof to attest to the fact of filing. In the event
that said offices certify that the SALN was indeed filed but could not be located,
said offices must certify the valid and legal reason of their non-availability, such as
by reason of destruction by natural calamity due to fire or earthquake, or by reason
of the allowed destruction after ten years under Section of R.A. No. 6713.
V.
Blatant Disregard and Open Defiance to the Sub Judice Rule
Perhaps owing to novelty, the instant case has opened pandora's box of
unsolicited opinions, streaming in abundance from those professed legal and non-
legal experts alike. This flurry of opinions, demonstrations, public and media
appearances made by the parties themselves or at their behest, or by their lawyers
and spokespersons, had demonstrably shifted the plane from what should
otherwise be purely legal, calm and sober approach to the present controversy into
detestable feast of pros and cons, and of mediocre and haphazard approximation
of perceived good versus evil. This veritable feast had become too delectable to
escape the waiting predators' keen sense of attack, especially at time when the
prey appears to be at its most vulnerable. This Court is an institution designed and
dedicated to specific purpose and thus refuses to fall prey and invite claws to dig
into its walls. Because of the various extraneous redirections from the merits which
the instant case has received, there is need to emphasize that this case involves
purely legal and justiciable matter which the Court intends, and had resolved,
through the application of the Constitution, the law and relevant jurisprudence,
unswayed by personalities or sentiments.
As such, the Court had lent extreme tolerance to the parties and nonparties
equally, as the Court shall ultimately speak through its decision. Be that as it may,
the Court, in jealous regard of judicial independence, cannot simply overlook the
open and blatant defiance of the sub judice rule suffered by the present action.
The sub judice rule restricts comments and disclosures pertaining to the judicial
proceedings in order to avoid prejudging the issue, influencing the court, or
obstructing the administration of justice.324 The rationale for this rule is for the
courts, in the decision of issues of fact and law, to be immune from every
extraneous influence; for the case to be decided upon evidence produced in court;
and for the determination of such facts be uninfluenced by bias, prejudice or
symphathies. In fine, what is sought to be protected is the primary duty of the
courts to administer justice in the resolution of cases before them. 325
Thus, it is generally inappropriate to discuss the merits of and make comments on
cases sub judice and such acts may even result to contempt of court. In US. v.
Sullen326 it was stated:
In clear case where it is necessary in order to dispose of judicial business
unhampered by publications which reasonably tend to impair the impartiality of
verdicts; or otherwise obstruct the administration of justice, this Court will not
hesitate to exercise its undoubted power to punish for contempt. This Court must
be permitted to proceed with the disposition of its business in an orderly manner
free from outside interference obstructive of its constitutional functions. This right
will be insisted upon as vital to an impartial court, and, as last resort, as an
individual exercises the right of self-defense, it will act to preserve its existence as
an unprejudiced tribunal.
In Our jurisdiction, this rule finds legal basis on the Court's power of contempt.
Rule 71 of the Rules of Court provides:
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Sec. 3. Indirect contempt to be punished after charge and hearing. After charge in
writing has been filed, and an opportunity given to the respondent to comment
thereon within such period may be fixed by the court and to be heard by himself or
counsel, person guilty of any of the following acts may be punished for indirect
contempt:
xxxx
(d) Any improper conduct tending, directly or indirectly, to impede, obstruct,
or degrade the administration of justice;
x x (Emphasis ours)
The oft-cited defense of persons charged with indirect contempt for violating
the sub judice rule is their right to free speech. Needless to say, this Court would
be the first in line of combat in legal battle to uphold such constitutionally-protected
right. However, when actions, posing to be innocent exercise of such right,
"impede, interfere with and embarrass the administration of justice" or "make
serious and imminent threat thereto", this Court will not hesitate to call out and
punish the same.327 In Sheppard v. Maxwell,328 the US Supreme Court reminds
that although the freedom of expression should be given great latitutde, it must not
be so broad as to divert the trial away from its objective which is to adjudicate both
criminal and civil matters in an objective, calm, and solemn courtroom setting.
The sub judice rule finds more austere application to members of the Bar and of
the Bench as the strict observance thereof is mandated by the Code of
Professional Responsibility and the Code of Judicial Conduct:
CODE OF PROFESSIONAL RESPONSIBILITY
CANON 13 A LAWYER SHALL RELY UPON THE MERITS OF HIS CAUSE AND
REFRAIN FROM ANY IMPROPRIETY WHICH TENDS TO INFLUENCE, OR
GIVES THE APPEARANCE OF INFLUENCING THE COURT.
Rule 13.02 A lawyer shall not make public statements in the media regarding
pending case tending to arouse public opinion for or against party.
NEW CODE OF JUDICIAL CONDUCT FOR THE PHILIPPINE JUDICIARY
CANON - INDEPENDENCE
Judicial independence is pre-requisite to the rule of law and fundamental
guarantee of fair trial. judge shall therefore uphold and exemplify judicial
independence in both its individual and institutional aspects.
SECTION 3. Judges shall refrain from influencing in any manner the outcome of
litigation or dispute pending before any court or administrative agency.
SECTION 7. Judges shall encourage and uphold safeguards for the discharge of
judicial duties in order to maintain and enhance the institutional and operational
independence of the judiciary.
SECTION 8. Judges shall exhibit and promote high standards of judicial conduct in
order to reinforce public confidence in the judiciary, which is fundamental to the
maintenance of judicial independence.
CANON - INTEGRITY
Integrity is essentially not only to the proper discharge of the judicial office but also
to the personal demeanor of judges.
SECTION 1. Judges shall ensure that not only is their conduct above reproach, but
that it is perceived to be so in the view of reasonable observer.
SECTION 2. The behavior and conduct of judges must reaffirm the people's faith
in the integrity of the judiciary. Justice must not merely be done but must also be
seen to be done.
CANON - IMPARTIALITY
Impartiality is essential to the proper discharge of the judicial office. It applies not
only to the decision itself but to the process by which the decision is made.
SECTION 2. Judges shall ensure that his or her conduct, both in and out of court,
maintains and enhances the confidence of the public, the legal profession, and
litigants in the impartiality of the judge and of the judiciary.
SECTION 4. Judges shall not knowingly, while proceeding is before or could come
before them, make any comment that might reasonably be expected to affect the
outcome of such proceeding or impair the manifest fairness of the process. Nor
shall judges make any comment in public or otherwise that might affect the fair trial
of any person or issue.
CANON - PROPRIETY
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SECTION 2. As subject of constant public scrutiny, judges must accept personal These public appearances,330 to name few, are as follows:
restrictions that might be viewed as burdensome by the ordinary citizen and should
do so freely and willingly. In particular, judges shall conduct themselves in way that Event Source Quotation
is consistent with the dignity of the judicial office. s

SECTION 6. Judges, like any other citizen, are entitled to freedom of expression, 'Speak Video: "Kung
belief, association and assembly, but in exercising such rights, they shall always Truth to <https://web.facebook.com/juliusnleonen/videos/889 manalo
conduct themselves in such manner as to preserve the dignity of the judicial office Power' 291114607029/> ang quo
and the impartiality and independence of the judiciary. forum in Article: warranto,
UP <https://www.rappler.com/nation/201854-sereno- mapupunt
Lawyer speech is subject to greater regulation for two significant reasons: one, Diliman, quo-warranto-destroyjudicial-independence> a tayo sa
because of the lawyer's relationship to the judicial process; and two, the signficant Quezon diktaturya,
dangers that lawyer's speech poses to the trial process.329 As such, actions in City " she said
violation of the sub judice rule may be dealt with not only through contempt on May 5, "Talagang
proceedings but also through administrative actions. 2018 wawasaki
n
It is thus perturbing that certain officials of the separate branches of the completel
Government and even men and women learned in law had succumbed to the y ng quo
tempting affray that tends to divert the instant quo warranto action from its primary warranto
purpose. Even worse, respondent and her spokepersons chose to litigate na ito ang
respondent's case, apart from her Ad Cautelam submissions to the Court, before judiciary."
several media-covered engagements. Through her actuations, respondent
appears to have forgotten that this is court action for quo warranto, and as such, "Pag itong
the concomitant rule on sub judice unnegotiably applies. Worst still, respondent quo
who is lawyer and who asserts right to the Chief Justice position and therefore warranto
must foremost be aware of the rule, continues to conjure public clamor against the natuloy,
Court and its Members with regard to this pending case in Court. hindi na
right and
It is interesting to note that respondent initially refused to participate in the reason,
congressional hearings for the impeachment complaint. When this petition for quo kundi will
warranto was filed, respondent continuously refuses to recognize this Court's will na
jurisdiction. Instead of participating in the process and answering the charges nu'ng
against her truthfully to assist in the expeditious resolution of the matter, whoever
respondent opted to proceed to nationwide campaign, conducting speeches and is on top.
accepting interviews, discussing the merits of the case and making comments So
thereon to vilify the members of the Congress, cast aspersions on the impartiality kailangan
of the Members of the Court, degrade the faith of the people to the Judiciary, and natin
falsely impute ill motives against the government that it is orchestrating the pigilan ito
charges against her. It is well-nigh unthinkable for respondent to profess ..." she
deprivation of due process when she herself chose to litigate her case before the said.
media.
Page 282 of 507
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Integrated Article: "Ano po
Bar of the <https://businessmirror.com.ph/sereno-sees- ang tawag "The
Philippine dictatorship-after-filingof-quo-warranto-petition- sa booming
s (IBP) against-her/> kondisyon voice of
Central na ang Justice
Luzon citizen Vicente
Regional walang Mendoza
Conventio kalaban- has
n and laban sa reverberat
Mandatory gobyerno" ed that if
Continuing Chief the quo
Legal Justice waranto
Education Maria petition is
at thr Lourdes granted,
Quest A. Sereno the
Hotel here asked. Judiciary
on May 2, will
2018 "Ang destroy
tawag po itself,"
doon Sereno
dictatorshi said as
p, hindi po she also
constitutio praised
nal the IBP's
democrac stand to
y ang oppose
tawag and
doon, " dismiss
she said. the
petition.
"That is
what is Forum on Video: "Of my
going to upholding <https://web.facebook.com/24OrasGMA/videos/l colleague
happen if Judicial 0156438427991977/?t=16> s, know
the quo Independe Article: that
waranto nce at the <http://newsinfo.inquirer. net/985460/defend-judicial- several of
petition is Ateneo independence-cjsereno-tells-law-students> them,
granted, " Law have had
Sereno School in their
stated. Rockwell, qualificati

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Cases – Special Civil Actions (Part 1)
Makati ons, their forum on
City on inability to judicial
Wednesda submit independ
y, April document ence.
25, 2018 ary
requireme "The
nts, questions
waived, propound
several of ed by
them. If Supreme
the JBC Court
was itself, they
correct in wanted to
saying examine
that an everything
attempt to did in the
submit past in the
requireme hope they
nts, that would find
good faith something
should be scandalou
accorded s in my
to the 14, life. was
including just
those preparing
against myself for
me, why the
am the question,
only one 'ilang
being boyfriend
singled mo na?,'"
out?, " Sereno
she told said,
law which
students elicited
at the laughter
Ateneo from the
Law crowd.
School
during

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Cases – Special Civil Actions (Part 1)
 "Hindi ko of San decisions
naman po Agustin in the
minanipul (USA) in many
a ni konti Iloilo City, pending
ang on April cases
JBC...14 20, 2018 before the
kaming Court.
pare- Anyway
parehong the
sitwasyon session
. Bakit will
nagrekla resume
mo kung on June
kayo 5, so
nalagay wha's with
sa the rush?"
listahan at
ako "Wala
nalagay namang
sa dahilan
listahan. para
Ang magmada
masama li."
ay hindi
kayo ang "Kung
nalagay at totoo po,
ako ang indication
nalagay, " po ito na
she mayroon
added. na po
silang
Speech at <https://www.philstar.com/headlines/2018/04/23/180 "The conclusio
the 8492/sereno-camp-questions-sc-haste-decide-her- month of n bago pa
Commenc case> May is man
ement time that marinig
Exercises <https://news.mb.com.ph/2018/04/21/no-need-to- 'is ang
of the rush-quo-warranto-sereno/> supposed lahat,"
College of to be Sereno
Law of the devoted said.
University to writing

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Cases – Special Civil Actions (Part 1)
Fellowship <http://newsinfo.inquirer.net/981806/sereno-ups- "Even hara-kiri,
of the attack-vs-quo-warranto-in-speech-at-lawyers-forum? your very if not
Philippine utm_campaign=Echobox&utm_medium=Social&utm livelihood judicial
Bar _source=Facebook#link_time=1523450119> s are kamikaze
Associatio threatene bringing it
n (PBA) in d; there is the
Makati no safety destructio
City for any of n of the
on April you... entire
11, 2018 That is judiciary
how as well as
deadly the entire
this quo consitutio
warranto nal
petition framewor
is," she k."
added.
30th <http://newsinfo.inquirer.net/973692/sereno-delivers- "I look at
Sereno Anniversar most-powerful-speech-yet-not-all-peers-happy> any forum
said if the y and 23rd to try me
Supreme National other than
Court Conventio the
would n of the constitutio
cooperate Philippine nally
in the Women exclusive
move of Judges form of
the Associatio impeachm
Executive n (PWJA) ent as an
to oust in Manila admission
her sans Hotel on by the
impeachm Thursday, complaina
ent trial, "I March 8, nt and my
will use 2018 other
directly detractors
the words that after
of Chief 15
Justice hearings,
Davide they have
that it will failed to
be judicial come up

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Cases – Special Civil Actions (Part 1)
with any Sereno
evidence added.
which can
be CNN <https://www.youtube.com/watch?v=HlYKAQ4QPcY In this
convicted Philippine 1. http://cnnphilippines.com/videos/2018/03/09/One- interview,
in the s (March on-one-with-Chief-Justice-Maria-Lourdes- CJOL
Senate," 9,2018); Sereno.html> Sereno,
she One on among
asserted. One with others,
the Chief stated
"Sila ang Justice that her
nagsimula with defense
bakit ay Pinky preparatio
aw nilang Webb n was
tapusin? directed
Napakaag towards
a naman the
yata para impeachm
umamin ent
sila na proceedin
wala gs as she
silang has not
napala assessed
kundi yet the
matinding quo
kabiguan warranto
kaya't petition as
kung anu- of the
ano na interview.
lamang
ang gimik - "From
ang the very
ginagawa beginning,
nila we were
masunod looking
lamang really at
ang the
kanilang impeachm
nais," ent
provisions

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Cases – Special Civil Actions (Part 1)
of the the
Constituti petition.
on so that CJOL
has been said that
the such
preparatio action of
n all the SC
along. does not
Well, mean
haven't anything
yet and
assessed affirmed
this latest Webb's
quo interepret
warranto ation that
petition. such
Not yet action
time does not
maybe" mean that
the SC
- CJOL assumes
Sereno jurisdictio
refused to n over the
talk about quo
the quo warranto
warranto case.
petition,
but - "Yan
interprete naman
d the SC's talaga
resolution ang hindi
which ko pwede
directed pagusapa
her to n, ano."
comment
on said - On
petition jurisdictio
without n:
taking due "Normal
course to yan, mar

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Cases – Special Civil Actions (Part 1)
ami laging
kaming ginagamit
ganyan na without
petition. due
Wala course at
naman marami
talagang kaming
ibig dinidismis
sabihin s na
yan. In nanggalin
most g sa
cases, without
walang giving due
ibig course
sabihin pero
yun kasi pinagkoco
hindi pa mment...
prejudged It doesn't
. Pero mean...
hayaan Ang usual
niyo po tradition
muna po namin
yung ay walang
lawyers ibig
ko ang sabihin po
magsabi yun"
kasi
mahirap Speech of <https: Directed
naman CJOL www.youtube.com/watch?v="iN511xW9bpk"> towards
pong Sereno at politicians
pangunah the supposedl
an ko sila Panpacifi y
eh c regarding
ginagawa Universit the
pa po nila y North ongoing
yung Philippine impeachm
sagot eh". s (March ent
9, 2018) proceedin
- "Marami (Posted gs, CJOL
ho kaming by CNN Sereno

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Philippine said, kung
s) "Wag na palagay
'wag niyo nyo kayo
kami ay tama
gigipitin" at andyan
and ang
further ebidensya
stated , lalabas
that such naman
what yan eh.
judicial Pero
independ huwag na
ence huwag
means. nyo
kaming
- I know gigipitin.
that our Yan ang
women ibig
judges, sabihin ng
for judicial
example, independ
are ence"
always
eager to Speech <http://newsinfo.inquirer.net/987807/live-chief- - CJOL
make on "The justice-sereno-at-up-diliman-forum> Sereno
stand for Mumshie emphasiz
judicial on Fire: ed that AJ
independ Speak Leonardo-
ence. Truth to De
Kayong Power" Castro's
mga held at inhibition
pulitiko, the would
wag Universit prove that
nyong y of the she is
pakialama Philippine unbiased.
n ang s (May 5,
aming 2018)
mga * Forum - Hindi
gustong was sila
gawin organized tumigil,

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Cases – Special Civil Actions (Part 1)
by youth hangga't said that
groups, Ak naisip ng "Even
o Ay Isang isa, yung when they
Sereno an nagaakus thought
d Youth a sa akin, they have
for Miriam "ay yung won, in
SALN the end,
niya, yung they will
SALN nya never win.
na sinabi The
nya sa country is
JBC na already
nahihirap woke. The
art niyang youth
humanap would not
(sic). Yun, listen to
dun lies. The
tugisin. At people
sinabi nya own the
na dapat judiciary.
ako ay They are
idisqualify not owned
dahil by the
unjust judiciary,
daw na the
ako ang justices,
naappoint the
. May judges"
injustice and that
na the "good
nangyari. will
So alam always
na natin prevail
ang isa sa over evil".
pinagsisi
mulan - CJOL
nito" Sereno
said that
- CJOL two of her
Sereno accusers,

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Cases – Special Civil Actions (Part 1)
who she ako dapat
considers naappoint
as her eh sila rin
rival also, ang
will be maghuhu
one of sga sa
those who akin.
will decide Saan
the quo kayo
warranto nakakila
petition ng
filed sitwasyon
against na yung
her, karibal
thereby niyo sa
against posisyon
the basic ang may
rules of kapangya
fair play. rihan
sabihin
- "Eh bakit kayong
biglang dapat ka
umatras matangga
sila(pertai l sa
ning to his posisyon,
accusers hindi ikaw
in the dapat.
impeachm Paano
ent nangyari?
proceedin Under
gs) at what rules
ginawa of
itong kaso fairness,
net quo what rules
warranto of
kung saan Constituti
ang on or
dalawa sa legal
nags ab system,
ing hindi can an

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accuser retirement
who acted benefits.
also as
my - "At alam
prosecuto nyo ho,
r during pag sinabi
the oral na invalid
argument yung
s now sit appointm
as judge? ent, pati
This yung
violates retirement
the most benefits
basic ho
norms of tatanggali
fairplay... n"
Ngayon
talaga, - The
nakita na, granting
na hindi of quo
ho ako warranto
bibigyan would
talaga ng result into
Hang ito dictatorshi
ng kahit p and
anong would
modicum destroy
of the
fairness" judiciary.

- She - At ano
discussed ho ang
that one mangyaya
of the ri kung
effects of ang
an invalid buong
appointm sangay
ent is the ang lahat
forfeiture ng kawani
of ng

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Cases – Special Civil Actions (Part 1)
gobyerno pananako
ay kayang t sa
takutin at buong
hindi na bayan?
pwedeng Ang
maging tawag po
independ dun,
ent?.. Ano diktalurya.
hong . Kung
mangyaya manalo
ri kung po ang
ang quo
COMELE warranto,
C ho ay yan po
sinabihan ang
ng magiging
President resulta"
e at
Solicitor - "Saang
General korte kayo
na pupunta?
"yungparti Sino ang
do lang magtatap
namin ang na
ang huwes
pwedeng kung
manalo, madali na
kung hindi sila
i-quo mapatang
warranto gal?...
ka Hindi na
namin?" ho kayo
Ano po makakata
yun? Ano kbo, kasi
yung lahat ho
tawag sa ng judges
ganoong tatakutin
sitwasyon ng
na may Solicitor
matinding General...

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Saan ho sa JBC.
kayo eh
pupunta naglalaba
sa isang san na ho
arbiter na ang SALN
impartial?. ko... pero
. wala na eto
po. tatanggali
Wawasaki n at
n nitong gagawa
quo sila ng
warranto prinsipyo
petition at
nito, ikawawas
completel ak ng
y ang buong
judiciary" bayan
para lang
- "Ano na sa
ho ang kanilang
mangyaya personal
ri sa na
bayan interes.
natin kung Nakakala
wala na gim po
hong ang
security of pangyaya
tenure sa ring ito"
governme
nt Speech <https://www.youtube.com/watch?v="oh35V4BMiww CJOL
service? on > Sereno
Kasi kung Ateneo discussed
may Law the
haunting School contents
kulang for the of the quo
lang sa forum warranto
file... Tindig: petition.
kulang forum on
ang file na upholdin - On the
nabigay g judicial prescriptiv

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independ e period, the one
ence as CJOL year
pillar of Sereno prescriptiv
democrac said that e period
y (April jobs of the can never
25, 2018) justices, apply
judges against
and governme
governme nt. It must
nt be
employee personal
s are knowledg
jeopardize e of the
d because Solicitor
of the General
assertion himself
of the And so if
OSG that you
petition change
for quo the
warranto person of
does not the
prescribe Solicitor
against General,
the the
governme period,
nt. CJOL continues
Sereno to always
said that be fresh.
such It's never
assertion prescriptib
makes the le,
action completel
imprescrip y
tible. imprescrip
tible
- "Accordi action. So
ng to the you
Solicitor jeopardize
General, the jobs of

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the prejudiced
justices, because
the judges their
and all qualificati
gov't ons may
employee suddenly
s. You be
allow reviewed.
selected
targeting - "The SC
against itself
the Chief really
Justice for wanted to
reasons examine
that are every little
very thing did
obvious in the past
now and in the
you hope that
destroy they
the legal would find
profession something
" scandalou
s about
1. my life..."

- On the - "It also

effect of prejudices
the quo more than
warranto 2000
petition, judges
CJOL and
Sereno justices
said that that are
all already
incumbent sitting
judges now
and because
justices all of their
would be qualificati

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ons may submit the
suddenly requireme
be nts, the
reviewed. good faith
The JBC accorded
was to those
wrong to who had
waive this missing
qualificati requireme
on for this nts,
position. should be
can tell accorded
you as to 14 of
matter of us,
record including
that of my those who
colleague have
s, know complaine
that d loudly
several of against
them me
have had among
their my
qualificati colleague
ons, their s, why am
inability to the only
submit one being
document singled
ary out? The
requireme rules of
nts, inability to
waived. submit all
Several of the
them. So SALNs
if the JBC were
was waived in
correct in favor of
saying 14 out of
that an 20
attempt to applicants

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, out of
the were
shortlisted
. Why is
the rule
being
invoked
only
against
me? And
so it
would
appear
that this is
selected
targeting"
The public actuation of respondent showing disdain and contempt towards some
Members of the Court whom she dubbed as "Biased 5" later increased and
modified to "Biased 6" can no longer be tolerated. She may be held liable for
disbarment for violating the Canons of Professional Responsibility for violating
the sub judice rule by repeatedly discussing the merits of the quo warranto petition
in different fora and for casting aspersions and ill motives to the Members of the
Court even before decision is made, designed to affect the results of the Court's
collegial vote and influence public opinion. This wrongful actuation exemplify poor
regard for the judicial system and may amount to conduct unbecoming of Justice
and lawyer.
Such actions, indeed, resulted to the obfuscation of the issues on hand,
camouflaging the charges against her with assaults to judicial independence, and
falsely conditioning the public's mind that this is fight for democracy. Once and for
all, it should be stated that this is not fight for democracy nor for judicial
independence. This is an undertaking of the Court's duty, as it is called for by the
Republic, to judicially determine and settle the uncertainty in the qualification, or
otherwise, of respondent to sit on the highest position in the Judiciary.
The detrimental effect of this open and blatant disregard of the sub judice rule or
the evil sought to be prevented by the said rule is already manifest. In fact, in the
May 2, 2018 issue of the Philippine Daily Inquirer, certain individuals, including
lawyers, already made their own pre-judgment on the case:
GRANTING THE QUO WARRANTO PETITION IS ILLEGAL, BETRAYAL OF
DEMOCRACY
THE SUPREME COURT TRAMPLED ON the Philippine Constitution and betrayed
its primary duty to the Filipino people when it violated Chief Justice Ma. Loudes
Sereno's right to due process.
The Supreme Court abandoned its chief mandate to ensure an independent
judiciary by accepting bankrupt Quo Warranto petition and refusing to inhibit five
openly biased Justices.
The Judiciary's Code of Conduct decrees resistance against attempts to subvert
judicial independence. It orders judges to be impartial. The five justices bowed to
Congress' impeaclunent summons. They attacked the Chief Justice in proceedings
that refused her right to question accusers. Doing so, they prejudged the Chief
Justice and betrayed the Court's position as co-equal branch of the government.
We repudiate as illegal ruling tainted with these shameful acts.
The Quo Warranto action against CJ Sereno, filed beyond the one year deadline,
is itself illegal and unconstitutional the Supreme Court has affirmed many times
that impeachment is the only mode for removing an impeachable officer.
In accepting this farcical petition, it crushes constitutional checks and balances it
threatens every Filipino citizen's right to free, impartial justice system.
The State derives its power from the people. When the key instruments of the
State conspire to subvert the Constitution and democracy, the people must rise as
the last bastion of our rights and freedoms.
We challenge the Supreme Court: Pull back from the brink. Do not be party to the
death of judicial independence. Heed the Constitution. OBEY THE CODE OF
JUDICIAL CONDUCT. COMPEL THE INHIBITION OF THE BIASED 5. DISMISS
THE ILLEGAL QUO WARRANTO PETITION!
If the Biased will not inhibit, then we call on them to resign. The people will not
acccept any Decision tainted by gross injustice and Justices who cannot act with
justice. (Emphasis ours)
It could readily be seen that such statements do not only "tend to" but categorically
force and influence the deliberative and decision-making process of this Court.
Notably, the threatening tenor could not go unnoticed.
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To be sure, the Court is not merely being unreasonably sensitive in addressing this
matter, as in fact, it guarantees that it is not swayed or influenced by such attacks
and maintains its judicial independence in resolving this controversial case.
However, when aggressive actions are taken against the Judiciary as an institution
and clouds of doubt are casted upon the people's faith in the administration of
justice, especially so when the same are perpetrated by members of the Bar, this
Court cannot be apathetic to and is not helpless against such attacks, but the
prudent thing to do is to stand and deal with it head on.
Epilogue
The foregoing discourse thins down to public officer's accountability to the public.
The very purpose and nature of public office is grounded upon it being public trust.
No less than our Constitution gave special importance on the principle of public
office being public trust. Section 1, Article XI of the 1987 Constitution categorically
states that:
Section 1. Public office is public trust. Public officers and employees must at
all times be accountable to the people, serve them with utmost
responsibility, integrity, loyalty, and efficiency, act with patriotism and justice,
and lead modest lives.
It is therefore an established principle that public office is not "property" but is
public trust or agency, governed by the Constitution and by existing laws. There is
no Torrens title to public office. Justice Malcolm, in Cornejo v. Gabriel and
Provincial Board of Rizal,331 expounded on this principle, viz.:
In the case of Taylor v. Beckham ([1899], 178, U. S., 548), Mr. Chief Justice Fuller
said that: "Decisions are numerous to the effect that public offices are mere
agencies or trust, and not property as such." The basic idea of government in the
Philippine Islands, as in the United States, is that of popular representative
government, the officers being mere agents and not rulers of the people, one
where no one man or set of men has proprietary or contractual right to an
office, but where every officer accepts office pursuant to the provisions of
the law and holds the office as trust for the people whom he
represents.332 (Emphasis ours)
The right to hold public office under our political system is therefore not natural
right. It exists, when it exists at all, only because and by virtue of some law
expressly or impliedly creating and conferring it.333 Needless to say, before one
can hold public office, he or she must be eligible in accordance with the
qualifications fixed by law and the authority conferring and creating the office.
There is no such thing as vested interest or an estate in an office, or even an
absolute right to hold office public officer who is not truthful, not forthright, in
complying with the qualifications to public office, perforce, has not legally qualified,
was not legally appointed, and consequently, has not legally assumed the said
public office disqualification cannot be erased by intentional concealment of certain
defects in complying with the qualifications to public office set by the Constitution
and laws. The passage of time will not cure such invalidity of holding public office,
much less, foreclose the right and duty of the government, the keeper of the said
public office, to oust and remove the usurper.
One who claims title to public office must prove beyond cavil that he/she is legally
qualified to the said office, otherwise, he or she has no ground to stand upon his or
her claim of title to the office and his or her title may reasonably be challenged.
qualification must be proved positively, clearly, and affirmatively. It cannot be
proved by mere acquiescence nor by estoppel or prescription. In the same vein,
disqualification cannot be obliterated by intentional concealment thereof. As matter
of fact, such concealment is clear manifestation of lack of integrity, probity, and
honesty. It cannot be over-emphasized that public service requires integrity. For
this reason, public servants must, at all times, exhibit the highest sense of honesty.
By the very nature of their duties and responsibilities, they must faithfully adhere
to, and hold sacred and render inviolate the constitutional principle that public
office is public trust.334 The expectation of strong adherence to this principle
escalates proportionately as one ascends to public office. John Adams, then
President of the United States, said, "society's demands for moral authority and
character increase as the importance of the position increases."
In this case, it was found that respondent is ineligible to hold the Chief Justice of
the Supreme Court position for lack of integrity on account of her failure to file
substantial number of SALNs and also, her failure to submit the required SALNs to
the JBC during her application for the position. Again, one of the Constitutional
duties of public officer is to submit declaration under oath of his or her assets,
liabilities, and net worth upon assumption of office and as often thereafter as may
be required by law.335 When the Constitution and the law exact obedience, public
officers must comply and not offer excuses. When public officer is unable or
unwilling to comply, he or she must not assume office in the first place, or if
already holding one, he or she must vacate that public office because it is the
correct and honorable thing to do. public officer who ignores, trivializes or
disrespects Constitutional and legal provisions, as well as the canons of ethical
standards, forfeits his or her right to hold and continue in that office.
WHEREFORE, the Petition for Quo Warranto is GRANTED. Respondent Maria
Lourdes P.A. Sereno is found DISQUALIFIED from and is hereby
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adjudged GUILTY of UNLAWFULLY HOLDING and EXERCISING the OFFICE
OF THE CHIEF JUSTICE. Accordingly, Respondent Maria Lourdes P. A. Sereno
is OUSTED and EXCLUDED therefrom.
The position of the Chief Justice of the Supreme Court is declared vacant and the
Judicial and Bar Council is directed to commence the application and nomination
process.
This Decision is immediately executory without need of further action from the
Court.
Respondent Maria Lourdes P.A. Sereno is ordered to SHOW CAUSE within ten
(10) days from receipt hereof why she should not be sanctioned for violating the
Code of Professional Responsibility and the Code of Judicial Conduct for
transgressing the sub judice rule and for casting aspersions and ill motives to the
Members of the Supreme Court.
SO ORDERED.
[G.R. No. 131977. February 4, 1999]
PEDRO MENDOZA, Petitioner, v. RAY ALLAS and GODOFREDO
OLORES, Respondents.
DECISION
PUNO, J.:
Before us, petitioner prays for the execution of the decision of the trial
court1 granting his petition for quo warranto which ordered his reinstatement as
Director III, Customs Intelligence and Investigation Service, and the payment of his
back salaries and benefits.
Petitioner Pedro Mendoza joined the Bureau of Customs in 1972. He held the
positions of Port Security Chief from March 1972 to August 1972, Deputy
Commissioner of Customs from August 1972 to September 1975, Acting
Commissioner of Customs from September 1975 to April 1977 and Customs
Operations Chief I from October 1987 to February 1988.2On March 1, 1988, he
was appointed Customs Service Chief of the Customs Intelligence and
Investigation Service (CIIS). In 1989, the position of Customs Service Chief was
reclassified by the Civil Service as "Director III" in accordance with Republic Act
No. 6758 and National Compensation Circular No. 50. Petitioner's position was
thus categorized as "Director III, CIIS" and he discharged the function and duties
of said office.
On April 22, 1993, petitioner was temporarily designated as Acting District
Collector, Collection District X, Cagayan de Oro City. In his place, respondent Ray
Allas was appointed as "Acting Director III" of the CIIS. Despite petitioner's new
assignment as Acting District Collector, however, he continued to receive the
salary and benefits of the position of Director III.
In September 1994, petitioner received a letter from Deputy Customs
Commissioner Cesar Z. Dario, informing him of his termination from the Bureau of
Customs, in view of respondent Allas' appointment as Director III by President
Fidel V. Ramos. The pertinent portion of the letter reads:
"Effective March 4, 1994, Mr. Ray Allas was appointed Director III by President
Fidel V. Ramos and as a consequence, [petitioner's] services were terminated
without prejudice to [his] claim for all government benefits due [him]."
Attached to the letter was the appointment of respondent Ray Allas as "Director III,
CIIS, Bureau of Customs, vice Pedro Mendoza."
Petitioner wrote the Customs Commissioner demanding his reinstatement with full
back wages and without loss of seniority rights. No reply was made.
On December 2, 1994, petitioner filed a petition for quo warranto against
respondent Allas before the Regional Trial Court, Paranaque, Branch 258. 3 The
case was tried and on September 11, 1995, a decision was rendered granting the
petition. The court found that petitioner was illegally terminated from office without
due process of law and in violation of his security of tenure, and that as he was
deemed not to have vacated his office, the appointment of respondent Allas to the
same office was void ab initio. The court ordered the ouster of respondent Allas
from the position of Director III, and at the same time directed the reinstatement of
petitioner to the same position with payment of full back salaries and other benefits
appurtenant thereto.
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Respondent Allas appealed to the Court of Appeals. On February 8, 1996, while
the case was pending before said court, respondent Allas was promoted by
President Ramos to the position of Deputy Commissioner of Customs for
Assessment and Operations. As a consequence of this promotion, petitioner
moved to dismiss respondent's appeal as having been rendered moot and
academic. The Court of Appeals granted the motion and dismissed the case
accordingly. The order of dismissal became final and entry of judgment was made
on March 19, 1996.4cräläwvirtualibräry
On May 9, 1996, petitioner filed with the court a quo a Motion for Execution of its
decision. On July 24, 1996, the court denied the motion on the ground that the
contested position vacated by respondent Allas was now being occupied by
respondent Godofredo Olores who was not a party to the quo
warranto petition.5cräläwvirtualibräry
Petitioner filed a special civil action for certiorari and mandamus with the Court of
Appeals questioning the order of the trial court.6 On November 27, 1997, the Court
of Appeals dismissed the petition.7 Hence, this recourse.
Petitioner claims that:
"The Court of Appeals grossly erred in holding that a writ of execution may no
longer be issued, considering that respondent Olores who was not a party to the
case now occupies the subject position."8
The instant petition arose from a special civil action for quo warranto under Rule
66 of the Revised Rules of Court. Quo warranto is a demand made by the state
upon some individual or corporation to show by what right they exercise some
franchise or privilege appertaining to the state which, according to the Constitution
and laws of the land, they cannot legally exercise except by virtue of a grant or
authority from the state.9 In other words, a petition for quo warranto is a
proceeding to determine the right of a person to the use or exercise of a franchise
or office and to oust the holder from its enjoyment, if his claim is not well-founded,
or if he has forfeited his right to enjoy the privilege.10 The action may be
commenced for the Government by the Solicitor General or the fiscal11 against
individuals who usurp a public office, against a public officer whose acts constitute
a ground for the forfeiture of his office, and against an association which acts as a
corporation without being legally incorporated.12 The action may also be instituted
by an individual in his own name who claims to be entitled to the public office or
position usurped or unlawfully held or exercised by another.13cräläwvirtualibräry
Where the action is filed by a private person, he must prove that he is entitled to
the controverted position, otherwise respondent has a right to the undisturbed
possession of the office.14 If the court finds for the respondent, the judgment
should simply state that the respondent is entitled to the office. 15 If, however, the
court finds for the petitioner and declares the respondent guilty of usurping,
intruding into, or unlawfully holding or exercising the office, judgment may be
rendered as follows:
"Sec. 10. Judgment where usurpation found.-- When the defendant is found guilty
of usurping, intruding into, or unlawfully holding or exercising an office, position,
right, privilege, or franchise, judgment shall be rendered that such defendant be
ousted and altogether excluded therefrom, and that the plaintiff or relator, as the
case may be, recover his costs. Such further judgment may be rendered
determining the respective rights in and to the office, position, right, privilege, or
franchise of all the parties to the action as justice requires."
If it is found that the respondent or defendant is usurping or intruding into the
office, or unlawfully holding the same, the court may order:
(1) The ouster and exclusion of the defendant from office;
(2) The recovery of costs by plaintiff or relator;
(3) The determination of the respective rights in and to the office, position, right,
privilege or franchise of all the parties to the action as justice requires. 16
The character of the judgment to be rendered in quo warranto rests to some extent
in the discretion of the court and on the relief sought.17 In the case at bar, petitioner
prayed for the following relief:
"WHEREFORE, it is respectfully prayed that respondent be ousted and altogether
excluded from the position of Director III, Customs Intelligence and Investigation
Service of the Bureau of Customs, and petitioner be seated to the position as the
one legally appointed and entitled thereto.
Other reliefs, just or equitable in the premises, are likewise prayed for."18
In granting the petition, the trial court ordered that:
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"WHEREFORE, viewed in the light of the foregoing, judgment is hereby rendered
granting this petition for quo warranto by:
1. Ousting and excluding respondent Ray Allas from the position of Director III,
Customs Intelligence and Investigation Service of the Bureau of Customs; and
2. Reinstating petitioner Pedro C. Mendoza, Jr. to the position of Director III,
Customs Intelligence and Investigation Service of the Bureau of Customs with full
back wages and other monetary benefits appurtenant thereto from the time they
were withheld until reinstated."19
The trial court found that respondent Allas usurped the position of "Director III,
Chief of the Customs Intelligence and Investigation Service." Consequently, the
court ordered that respondent Allas be ousted from the contested position and that
petitioner be reinstated in his stead. Although petitioner did not specifically pray for
his back salaries, the court ordered that he be paid his "full back wages and other
monetary benefits" appurtenant to the contested position "from the time they were
withheld until reinstated."
The decision of the trial court had long become final and executory, and petitioner
prays for its execution. He alleges that he should have been reinstated despite
respondent Olores' appointment because the subject position was never vacant to
begin with. Petitioner's removal was illegal and he was deemed never to have
vacated his office when respondent Allas was appointed to the same. Respondent
Allas' appointment was null and void and this nullity allegedly extends to
respondent Olores, his successor-in-interest.20cräläwvirtualibräry
Ordinarily, a judgment against a public officer in regard to a public right binds his
successor in office. This rule, however, is not applicable in quo warranto cases.21 A
judgment in quo warranto does not bind the respondent's successor in office, even
though such successor may trace his title to the same source. This follows from
the nature of the writ of quo warranto itself. It is never directed to an officer as
such, but always against the person-- to determine whether he is constitutionally
and legally authorized to perform any act in, or exercise any function of the office
to which he lays claim.22 In the case at bar, the petition for quo warranto was filed
by petitioner solely against respondent Allas. What was threshed out before the
trial court was the qualification and right of petitioner to the contested position as
against respondent Ray Allas, not against Godofredo Olores. The Court of Appeals
did not err in denying execution of the trial court's decision.
Petitioner has apprised this Court that he reached the compulsory retirement age
of sixty-five (65) years on November 13, 1997. Reinstatement not being possible,
petitioner now prays for the payment of his back salaries and other benefits from
the time he was illegally dismissed until finality of the trial court's
decision.23cräläwvirtualibräry
Respondent Allas cannot be held personally liable for petitioner's back salaries
and benefits. He was merely appointed to the subject position by the President of
the Philippines in the exercise of his constitutional power as Chief Executive.
Neither can the Bureau of Customs be compelled to pay the said back salaries and
benefits of petitioner. The Bureau of Customs was not a party to the petition
for quo warranto.24cräläwvirtualibräry
IN VIEW WHEREOF, the petition is denied and the decision of the Court of
Appeals in CA-G.R. SP No. 41801 is affirmed.
SO ORDERED.
G.R. No. 168696 February 28, 2006
MA. LUTGARDA P. CALLEJA, JOAQUIN M. CALLEJA, JR., JADELSON
PETER P. CALLEJA, MA. JESSICA T. FLORES, MERCIE C. TIPONES and
PERFECTO NIXON C. TABORA, Petitioners,
vs.
JOSE PIERRE A. PANDAY, AUGUSTO R. PANDAY and MA. THELNA P.
MALLARI, Respondents.
DECISION
AUSTRIA-MARTINEZ, J.:
This resolves the petition for review on certiorari assailing the Order1 of the
Regional Trial Court of San Jose, Camarines Sur, Branch 58 (RTC-Br. 58) issued
on July 13, 2005.
The antecedent facts are as follows.
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On May 16, 2005, respondents filed a petition with the Regional Trial Court of San
Jose, Camarines Sur for quo warranto with Damages and Prayer for Mandatory
and Prohibitory Injunction, Damages and Issuance of Temporary Restraining
Order against herein petitioners. Respondents alleged that from 1985 up to the
filing of the petition with the trial court, they had been members of the board of
directors and officers of St. John Hospital, Incorporated, but sometime in May
2005, petitioners, who are also among the incorporators and stockholders of said
corporation, forcibly and with the aid of armed men usurped the powers which
supposedly belonged to Respondents.
On May 24, 2005, RTC-Br. 58 issued an Order transferring the case to the
Regional Trial Court in Naga City. According to RTC-Br. 58, since the verified
petition showed petitioners therein (herein respondents) to be residents of Naga
City, then pursuant to Section 7, Rule 66 of the 1997 Rules of Civil Procedure, the
action for quo warrantoshould be brought in the Regional Trial Court exercising
jurisdiction over the territorial area where the respondents or any of the
respondents resides. However, the Executive Judge of RTC, Naga City refused to
receive the case folder of the subject case for quo warranto, stating that improper
venue is not a ground for transferring a quo warranto case to another
administrative jurisdiction.
The RTC-Br. 58 then proceeded to issue and serve summons on herein petitioners
(respondents below). Petitioner Tabora filed his Answer dated June 8, 2005,
raising therein the affirmative defenses of (1) improper venue, (2) lack of
jurisdiction, and (3) wrong remedy of quo warranto. Thereafter, the other
petitioners also filed their Answer, also raising the same affirmative defenses. All
the parties were then required to submit their respective memoranda.
On July 13, 2005, RTC-Br. 58 issued the assailed Order, the pertinent portions of
which read as follows:
It is undisputed that the plaintiffs’ cause of action involves controversies arising out
of intra-corporate relations, between and among stockholders, members or
associates of the St. John Hospital Inc. which originally under PD 902-A approved
on March 11, 1976 is within the original and exclusive jurisdiction of the Securities
and Exchange Commission to try and decide in addition to its regulatory and
adjudicated functions (Section 5, PD 902-A). Upon the advent of RA 8799
approved on July 19, 2000, otherwise known as the Securities and Regulation
Code, the Commission’s jurisdiction over all cases enumerated in Section 5,
Presidential Decree 902-A were transferred ["]to the Court of general jurisdiction or
the appropriate Regional Trial Court with a proviso that the "Supreme Court in the
exercise of its authority may designate the Regional Trial Court branches that shall
exercise jurisdiction over these cases." Pursuant to this mandate of RA 8799, the
Supreme Court in the exercise of said mandated authority, promulgated on
November 21, 2000, A.M. No. 00-11-03-SC which took effect 15 December 2000
designated certain branches of the Regional Trial Court to try and decide
Securities and Exchange Commission Cases arising within their respective
territorial jurisdiction with respect to the National Capital Region and within the
respective provincesin the First to Twelve Judicial Region. Accordingly, in the
Province of Camarines Sur, (Naga City) RTC Branch 23 presided by the Hon.
Pablo M. Paqueo, Jr. was designated as "special court" (Section 1, A.M. No. 00-
11-03-SC).
Subsequently, on January 23, 2001, supplemental Administrative Circular No. 8-01
which took effect on March 1, 2001 was issued by the Supreme Court which
directed that "all SEC cases originally assigned or transmitted to the regular
Regional Trial Court shall be transferred to branches of the Regional Trial Court
specially designated to hear such cases in accordance with A.M. No. 00-11-03-SC.
On March 13, 2001, A.M. No. 01-2-04 SC was promulgated and took effect on
April 1, 2001.
From the foregoing discussion and historical background relative to the venue and
jurisdiction to try and decide cases originally enumerated in Section 5 of PD 902-A
and later under Section 5.2 of RA 8799, it is evident that the clear intent of the
circular is to bestow the juridiction "to try and decide these cases to the "special
courts" created under A.M. No. 00-11-03-SC. . . .
Under Section 8, of the Interim Rules, [a] Motion to Dismiss is among the
prohibited pleadings. On the otherhand, the Supreme Court under Administrative
Order 8-01 has directed the transfer from the regular courts to the branches of the
Regional Trial Courts specially designated to try and decide intra-corporate
dispute.
In the light of the above-noted observations and discussion, the Motion to
Dismiss is DENIED pursuant to the Interim Rules of Procedure for Intra-Corporate
Controversies (A.M. No. 01-2-04-SC) which mandates that motion to dismiss is a
prohibited pleading (Section 8) and in consonance with Administrative Order 8-01
of the Supreme Court dated March 1, 2001, this case is hereby
ordered remanded to the Regional Trial Court Branch 23, Naga City which under
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A.M. No. 00-11-03-SC has been designated as special court to try and decide
intra-corporate controversies under R.A. 8799.
The scheduled hearing on the prayer for temporary restraining order and
preliminary injunction set on July 18, 2005 is hereby cancelled.
For reasons of comity the issue of whether Quo Warranto is the proper remedy is
better left to the court of competent jurisdiction to rule upon.
SO ORDERED. 2
Petitioners no longer moved for reconsideration of the foregoing Order and,
instead, immediately elevated the case to this Court via a petition for review
on certiorari under Rule 45 of the 1997 Rules of Civil Procedure.
The petition raises the following issues:
I another branch of the Regional Trial Court that had been designated as a special
WHETHER A BRANCH OF THE REGIONAL TRIAL COURT WHICH HAS
NO JURISDICTION TO TRY AND DECIDE A CASE HAS AUTHORITY
TO REMAND THE SAME TO ANOTHER CO-EQUAL COURT IN ORDER
TO CURE THE DEFECTS ON VENUE AND JURISDICTION
II
WHETHER OR NOT ADMINISTRATIVE CIRCULAR NO. 8-01 DATED
JANUARY 23, 2001 WHICH TOOK EFFECT ON MARCH 1, 2001 MAY
BE APPLIED IN THE PRESENT CASE WHICH WAS FILED ON MAY 16,
2005. 3
In their Comment, respondents argue that the present petition should be denied
due course and dismissed on the grounds that (1) an appeal under Rule 45 is
inappropriate in this case because the Order dated July 13, 2005 is merely an
interlocutory order and not a final order as contemplated under Rule 45 of the 1997
Rules of Civil Procedure; (2) a petition for review on certiorari under Rule 45 is the
wrong remedy under A.M. No. 04-9-07-SC, which provides that "all decisions and
final orders in cases falling under the Interim Rules of Corporate Rehabilitation and
the Interim Rules of Procedure Governing Intra-Corporate Controversies under
Republic Act No. 8799 shall be appealable to the Court of Appeals through a
petition for review under Rule 43 of the Rules of Court;" and (3) the petition was
intended merely to delay the proceedings in the trial court because when the case
was transferred to Branch 21 of the Regional Trial Court, said court granted
petitioners’ motion to hold the proceedings in view of the present petition pending
before this Court.
Subsequently, petitioners also filed an Urgent Motion to Restore Status Quo Ante,
alleging that on January 12, 2006, respondent Jose Pierre Panday, with the aid of
14 armed men, assaulted the premises of St. John Hospital in Naga City, taking
away the daily hospital collections estimated at ₱400,000.00.
The Court notes that, indeed, petitioners chose the wrong remedy to assail the
Order of July 13, 2005. It is hornbook principle that Rule 45 of the 1997 Rules of
Civil Procedure governs appeals from judgments or final orders. 4 The Order dated
July 13, 2005 is basically a denial of herein petitioners’ prayer in their Answer for
the dismissal of respondents’ case against them. As a consequence of the trial
court’s refusal to dismiss the case, it then directed the transfer of the case to
court to hear cases formerly cognizable by the SEC. Verily, the order was merely
interlocutory as it does not dispose of the case completely, but leaves something
more to be done on its merits. Such being the case, the assailed Order cannot
ordinarily be reviewed through a petition under Rule 45. As we held in Tolentino v.
Natanauan, 5 to wit:
In the case of Bangko Silangan Development Bank vs. Court of Appeals, the Court
reiterated the well-settled rule that:
. . . an order denying a motion to dismiss is merely interlocutory and therefore not
appealable, nor can it be the subject of a petition for review on certiorari. Such
order may only be reviewed in the ordinary course of law by an appeal from the
judgment after trial. The ordinary procedure to be followed in that event is to file an
answer, go to trial, and if the decision is adverse, reiterate the issue on appeal
from the final judgment.6
It appears, however, that the longer this case remains unresolved, the greater
chance there is for more violence between the parties to erupt. In Philippine
Airlines v. Spouses Kurangking,7 the Court proceeded to give due course to a case
despite the wrong remedy resorted to by the petitioner therein, stating thus:
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While a petition for review on certiorari under Rule 45 would ordinarily be
inappropriate to assail an interlocutory order, in the interest, however, of arresting
the perpetuation of an apparent error committed below that could only serve to
unnecessarily burden the parties, the Court has resolved to ignore the technical
flaw and, also, to treat the petition, there being no other plain, speedy and
adequate remedy, as a special civil action for certiorari. Not much, after all, can be
gained if the Court were to refrain from now making a pronouncement on an issue
so basic as that submitted by the parties.8
In this case, the basic issue of which court has jurisdiction over cases previously
cognizable by the SEC under Section 5, Presidential Decree No. 902-A (P.D. No.
902-A), and the propensity of the parties to resort to violence behoove the Court to
look beyond petitioners’ technical lapse of filing a petition for review
on certiorari instead of filing a petition for certiorari under Rule 65 with the proper
court. Thus, the Court shall proceed to resolve the case on its merits.
It should be noted that allegations in a complaint for quo warranto that certain
persons usurped the offices, powers and functions of duly elected members of the
board, trustees and/or officers make out a case for an intra-corporate
controversy.9 Prior to the enactment of R.A. No. 8799, the Court, adopting Justice
Jose Y. Feria’s view, declared in Unilongo v. Court of Appeals 10 that Section 1,
Rule 66 of the 1997 Rules of Civil Procedure is "limited to actions of quo
warranto against persons who usurp a public office, position or franchise; public
officers who forfeit their office; and associations which act as corporations without
being legally incorporated," while "[a]ctions of quo warrantoagainst corporations, or
against persons who usurp an office in a corporation, fall under the jurisdiction of
the Securities and Exchange Commission and are governed by its rules. (P.D. No.
902-A as amended)."11
However, R.A. No. 8799 was passed and Section 5.2 thereof provides as follows:
5.2. The Commission’s jurisdiction over all cases enumerated under Section 5 of
Presidential Decree No. 902-A is hereby transferred to the Courts of general
jurisdiction or the appropriate Regional Trial Court: Provided, That the Supreme
Court in the exercise of its authority may designate the Regional Trial Court
branches that shall exercise jurisdiction over these cases. xxx
Therefore, actions of quo warranto against persons who usurp an office in a
corporation, which were formerly cognizable by the Securities and Exchange
Commission under PD 902-A, have been transferred to the courts of general
jurisdiction. But, this does not change the fact that Rule 66 of the 1997 Rules of
Civil Procedure does not apply to quo warranto cases against persons who usurp
an office in a private corporation. Presently, Section 1(a) of Rule 66 reads thus:
Section 1. Action by Government against individuals. – An action for the usurpation
of a public office, position or franchise may be commenced by a verified petition
brought in the name of the Republic of the Philippines against
(a) A person who usurps, intrudes into, or unlawfully holds or exercises a public
office, position or franchise;
xxxx
As explained in the Unilongo12 case, Section 1(a) of Rule 66 of the present Rules
no longer contains the phrase "or an office in a corporation created by authority of
law" which was found in the old Rules. Clearly, the present Rule 66 only applies to
actions of quo warranto against persons who usurp a public office, position or
franchise; public officers who forfeit their office; and associations which act as
corporations without being legally incorporated despite the passage of R.A. No.
8799. It is, therefore, The Interim Rules of Procedure Governing Intra-Corporate
Controversies Under R.A. No. 8799 (hereinafter the Interim Rules) which applies to
the petition for quo warrantofiled by respondents before the trial court since what is
being questioned is the authority of herein petitioners to assume the office and act
as the board of directors and officers of St. John Hospital, Incorporated.
The Interim Rules provide thus:
Section 1. (a) Cases covered. – These Rules shall govern the procedure
to be observed in civil cases involving the following:
xxxx
(2) Controversies arising out of intra-corporate, partnership, or
association relations, between and among stockholders, members,
or associates, and between, any or all of them and the corporation,
partnership, or association of which they are stockholders, members, or
associates, respectively;
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 (3) Controversies in the election or appointment of directors,
trustees, officers, or managers of corporations, partnerships, or
associations;
xxxx
SEC. 5. Venue. – All actions covered by these Rules shall be commenced
and tried in the Regional Trial Court which has jurisdiction over the
principal office of the corporation, partnership, or association concerned.
xxx (Emphasis ours)
Pursuant to Section 5.2 of R.A. No. 8799, the Supreme Court promulgated A.M.
No. 00-11-03-SC (effective December 15, 2000) designating certain branches of
the Regional Trial Courts to try and decide cases formerly cognizable by the
Securities and Exchange Commission. For the Fifth Judicial Region, this Court
designated the following branches of the Regional Trial Court, to wit:
Camarines Sur (Naga City) Branch 23, Judge Pablo M. Paqueo, Jr.
Albay (Legaspi City) Branch 4, Judge Gregorio A. Consulta
Sorsogon (Sorsogon) Branch 52, Judge Honesto A. Villamor
Subsequently, the Court promulgated A.M. No. 03-03-03-SC, effective July 1,
2003, which provides that:
1. The Regional Courts previously designated as SEC Courts through
the: (a) Resolutions of this Court dated 21 November 2000, 4 July 2001,
12 November 2002, and 9 July 2002, all issued in A.M. No. 00-11-03-SC,
(b) Resolution dated 27 August 2001 in A.M. No. 01-5-298-RTC; and (c)
Resolution dated 8 July 2002 in A.M. No. 01-12-656-RTC are
hereby DESIGNATED and shall be CALLED as Special Commercial
Courts to try and decide cases involving violations of Intellectual
Property Rights which fall within their jurisdiction and those cases
formerly cognizable by the Securities and Exchange Commission;
xxxx
4. The Special Commercial Courts shall have jurisdiction over cases
arising within their respective territorial jurisdiction with respect to the
National Capital Judicial Region and within the respective provinces with
respect to the First to Twelfth Judicial Regions. Thus, cases shall be filed
in the Office of the Clerk of Court in the official station of the
designated Special Commercial Court; (Emphasis ours)
The next question then is, which branch of the Regional Trial Court has jurisdiction
over the present action for quo warrato? Section 5 of the Interim Rules provides
that the petition should be commenced and tried in the Regional Trial Court that
has jurisdiction over the principal office of the corporation. It is undisputed that the
principal office of the corporation is situated at Goa, Camarines Sur. Thus,
pursuant to A.M. No. 00-11-03-SC and A.M. No. 03-03-03-SC, it is the Regional
Trial Court designated as Special Commercial Courts in Camarines Sur which
shall have jurisdiction over the petition for quo warranto filed by herein
Respondents.
Evidently, the RTC-Br. 58 in San Jose, Camarines Sur is bereft of jurisdiction over
respondents’ petition for quo warranto. Based on the allegations in the petition, the
case was clearly one involving an intra-corporate dispute. The trial court should
have been aware that under R.A. No. 8799 and the aforementioned administrative
issuances of this Court, RTC-Br. 58 was never designated as a Special
Commercial Court; hence, it was never vested with jurisdiction over cases
previously cognizable by the SEC.
Such being the case, RTC-Br. 58 did not have the requisite authority or power to
order the transfer of the case to another branch of the Regional Trial Court. The
only action that RTC-Br. 58 could take on the matter was to dismiss the petition for
lack of jurisdiction. In HLC Construction and Development Corp. v. Emily Homes
Subdivision Homeowners’ Association,13 the Court held that the trial court, having
no jurisdiction over the subject matter of the complaint, should dismiss the same
so the issues therein could be expeditiously heard and resolved by the tribunal
which was clothed with jurisdiction.
Note, further, that respondents’ petition for quo warranto was filed as late as 2005.
A.M. No. 03-03-03-SC took effect as early as July 1, 2003 and it was clearly
provided therein that such petitions shall be filed in the Office of the Clerk of
Court in the official station of the designated Special Commercial Court.
Since the official station of the designated Special Commercial Court for
Camarines Sur is the Regional Trial Court in Naga City, respondents should have
filed their petition with said court. A.M. No. 00-11-03-SC having been in effect for
four years and A.M. No. 03-03-03-SC having been in effect for almost two years by
the time respondents filed their petition, there is no cogent reason why
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respondents were not aware of the appropriate court where their petition should be
filed.
The ratiocination of RTC-Br.58 that Administrative Circular No. 08-2001 authorized
said trial court to order the transfer of respondents’ petition to the Regional Trial
Court of Naga City is specious because as of the time of filing of the petition, A.M.
No. 03-03-03-SC, which clearly stated that cases formerly cognizable by the SEC
should be filed with the Office of the Clerk of Court in the official station of the
designated Special Commercial Court,had been in effect for almost two years.
Thus, the filing of the petition with the Regional Trial Court of San Jose, Camarines
Sur, which had no jurisdiction over those kinds of actions, was clearly erroneous.
WHEREFORE, the petition is GIVEN DUE COURSE and GRANTED. The Order of
the Regional Trial Court of San Jose, Camarines Sur dated July 13, 2005 is SET
ASIDE for being NULL and VOID. The petition for quo warranto in Civil Case No.
T-1007 (now re-docketed as SEC Case No. RTC 2005-0001), entitled "Jose Pierre
A. Panday, et al. v. Sps. Joaquin M. Calleja, Jr., et al." is ordered DISMISSED.
SO ORDERED.
G.R. Nos. 179431-32 June 22, 2010
LUIS K. LOKIN, JR., as the second nominee of CITIZENS BATTLE AGAINST
CORRUPTION (CIBAC),Petitioner,
vs.
COMMISSION ON ELECTIONS and the HOUSE OF
REPRESENTATIVES, Respondents.
x - - - - - - - - - - - - - - - - - - - - - - -x
G.R. No. 180443
LUIS K. LOKIN, JR., Petitioner,
vs.
COMMISSION ON ELECTIONS (COMELEC), EMMANUEL JOEL J.
VILLANUEVA, CINCHONA C. GONZALES and ARMI JANE R.
BORJE, Respondents.
DECISION
BERSAMIN, J.:
The principal question posed in these consolidated special civil actions for
certiorari and mandamus is whether the Commission on Elections (COMELEC)
can issue implementing rules and regulations (IRRs) that provide a ground for the
substitution of a party-list nominee not written in Republic Act (R.A.) No.
7941,1 otherwise known as the Party-List System Act, the law that the COMELEC
thereby implements.
Common Antecedents
The Citizens’ Battle Against Corruption (CIBAC) was one of the organized groups
duly registered under the party-list system of representation that manifested their
intent to participate in the May 14, 2007 synchronized national and local elections.
Together with its manifestation of intent to participate, 2 CIBAC, through its
president, Emmanuel Joel J. Villanueva, submitted a list of five nominees from
which its representatives would be chosen should CIBAC obtain the required
number of qualifying votes. The nominees, in the order that their names appeared
in the certificate of nomination dated March 29, 2007,3 were: (1) Emmanuel Joel J.
Villanueva; (2) herein petitioner Luis K. Lokin, Jr.; (3) Cinchona C. Cruz-Gonzales;
(4) Sherwin Tugna; and (5) Emil L. Galang. The nominees’ certificates of
acceptance were attached to the certificate of nomination filed by CIBAC. The list
of nominees was later published in two newspapers of general circulation, The
Philippine Star News4 (sic) and The Philippine Daily Inquirer.5
Prior to the elections, however, CIBAC, still through Villanueva, filed a certificate of
nomination, substitution and amendment of the list of nominees dated May 7,
2007,6 whereby it withdrew the nominations of Lokin, Tugna and Galang and
substituted Armi Jane R. Borje as one of the nominees. The amended list of
nominees of CIBAC thus included: (1) Villanueva, (2) Cruz-Gonzales, and (3)
Borje.
Following the close of the polls, or on June 20, 2007, Villanueva sent a letter to
COMELEC Chairperson Benjamin Abalos,7 transmitting therewith the signed
petitions of more than 81% of the CIBAC members, in order to confirm the
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withdrawal of the nomination of Lokin, Tugna and Galang and the substitution of
Borje. In their petitions, the members of CIBAC averred that Lokin and Tugna were
not among the nominees presented and proclaimed by CIBAC in its proclamation
rally held in May 2007; and that Galang had signified his desire to focus on his
family life.
On June 26, 2007, CIBAC, supposedly through its counsel, filed with the
COMELEC en banc sitting as the National Board of Canvassers a motion seeking
the proclamation of Lokin as its second nominee.8 The right of CIBAC to a second
seat as well as the right of Lokin to be thus proclaimed were purportedly based on
Party-List Canvass Report No. 26, which showed CIBAC to have garnered a grand
total of 744,674 votes. Using all relevant formulas, the motion asserted that CIBAC
was clearly entitled to a second seat and Lokin to a proclamation.
The motion was opposed by Villanueva and Cruz-Gonzales.
Notwithstanding Villanueva’s filing of the certificate of nomination, substitution and
amendment of the list of nominees and the petitions of more than 81% of CIBAC
members, the COMELEC failed to act on the matter, prompting Villanueva to file a
petition to confirm the certificate of nomination, substitution and amendment of the
list of nominees of CIBAC on June 28, 2007.9
On July 6, 2007, the COMELEC issued Resolution No. 8219,10 whereby it resolved
to set the matter pertaining to the validity of the withdrawal of the nominations of
Lokin, Tugna and Galang and the substitution of Borje for proper disposition and
hearing. The case was docketed as E.M. No. 07-054.
In the meantime, the COMELEC en banc, sitting as the National Board of
Canvassers, issued National Board of Canvassers (NBC) Resolution No. 07-60
dated July 9, 200711 to partially proclaim the following parties, organizations and
coalitions participating under the Party-List System as having won in the May 14,
2007 elections, namely: Buhay Hayaan Yumabong, Bayan Muna, CIBAC, Gabriela
Women's Party, Association of Philippine Electric Cooperatives, Advocacy for
Teacher Empowerment Through Action, Cooperation and Harmony Towards
Educational Reforms, Inc., Akbayan! Citizen's Action Party, Alagad, Luzon
Farmers Party, Cooperative-Natco Network Party, Anak Pawis, Alliance of Rural
Concerns and Abono; and to defer the proclamation of the nominees of the parties,
organizations and coalitions with pending disputes until final resolution of their
respective cases.
The COMELEC en banc issued another resolution, NBC Resolution No. 07-72
dated July 18, 2007,12 proclaiming Buhay Hayaan Yumabong as entitled to 2
additional seats and Bayan Muna, CIBAC, Gabriela Women's Party, and
Association of Philippine Electric Cooperatives to an additional seat each; and
holding in abeyance the proclamation of the nominees of said parties,
organizations and coalitions with pending disputes until the final resolution of their
respective cases.
With the formal declaration that CIBAC was entitled to an additional seat, Ricardo
de los Santos, purportedly as secretary general of CIBAC, informed Roberto P.
Nazareno, Secretary General of the House of Representatives, of the promulgation
of NBC Resolution No. 07-72 and requested that Lokin be formally sworn in by
Speaker Jose de Venecia, Jr. to enable him to assume office. Nazareno replied,
however, that the request of Delos Santos could not be granted because
COMELEC Law Director Alioden D. Dalaig had notified him of the pendency of
E.M. 07-054.
On September 14, 2007, the COMELEC en banc resolved E.M. No. 07-
05413 thuswise:
WHEREFORE, considering the above discussion, the Commission hereby
approves the withdrawal of the nomination of Atty. Luis K. Lokin, Sherwin N. Tugna
and Emil Galang as second, third and fourth nominees respectively and the
substitution thereby with Atty. Cinchona C. Cruz-Gonzales as second nominee and
Atty. Armi Jane R. Borje as third nominee for the party list CIBAC. The new order
of CIBAC's nominees therefore shall be:
1. Emmanuel Joel J. Villanueva
2. Cinchona C. Cruz-Gonzales
3. Armi Jane R. Borje
SO ORDERED.
The COMELEC en banc explained that the actions of Villanueva in his capacity as
the president of CIBAC were presumed to be within the scope of his authority as
such; that the president was charged by Section 1 of Article IV of the CIBAC By-
Laws to oversee and direct the corporate activities, which included the act of
submitting the party's manifestation of intent to participate in the May 14, 2007
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elections as well as its certificate of nominees; that from all indications, Villanueva
as the president of CIBAC had always been provided the leeway to act as the
party's representative and that his actions had always been considered as valid;
that the act of withdrawal, although done without any written Board approval, was
accomplished with the Board’s acquiescence or at least understanding; and that
the intent of the party should be given paramount consideration in the selection of
the nominees.
As a result, the COMELEC en banc proclaimed Cruz-Gonzales as the official
second nominee of CIBAC.14 Cruz-Gonzales took her oath of office
as a Party-List Representative of CIBAC on September 17, 2007.15
Precís of the Consolidated Cases
In G.R. No. 179431 and G.R. No. 179432, Lokin seeks through mandamus to
compel respondent COMELEC to proclaim him as the official second nominee of
CIBAC.
In G.R. No. 180443, Lokin assails Section 13 of Resolution No. 7804 promulgated
on January 12, 2007;16 and the resolution dated September 14, 2007 issued in
E.M. No. 07-054 (approving CIBAC’s withdrawal of the nominations of Lokin,
Tugna and Galang as CIBAC’s second, third and fourth nominees, respectively,
and the substitution by Cruz-Gonzales and Borje in their stead, based on the right
of CIBAC to change its nominees under Section 13 of Resolution No. 7804). 17 He
alleges that Section 13 of Resolution No. 7804 expanded Section 8 of R.A. No.
7941.18the law that the COMELEC seeks to thereby implement.
In its comment, the COMELEC asserts that a petition for certiorari is an
inappropriate recourse in law due to the proclamation of Cruz-Gonzales as
Representative and her assumption of that office; that Lokin’s proper recourse was
an electoral protest filed in the House of Representatives Electoral Tribunal
(HRET); and that, therefore, the Court has no jurisdiction over the matter being
raised by Lokin.
For its part, CIBAC posits that Lokin is guilty of forum shopping for filing a petition
for mandamus and a petition for certiorari, considering that both petitions ultimately
seek to have him proclaimed as the second nominee of CIBAC.
Issues
The issues are the following:
(a) Whether or not the Court has jurisdiction over the controversy;
(b) Whether or not Lokin is guilty of forum shopping;
(c) Whether or not Section 13 of Resolution No. 7804 is unconstitutional
and violates the Party-List System Act; and
(d) Whether or not the COMELEC committed grave abuse of discretion
amounting to lack or excess of jurisdiction in approving the withdrawal of
the nominees of CIBAC and allowing the amendment of the list of
nominees of CIBAC without any basis in fact or law and after the close of
the polls, and in ruling on matters that were intra-corporate in nature.
Ruling
The petitions are granted.
A
The Court has jurisdiction over the case
The COMELEC posits that once the proclamation of the winning party-list
organization has been done and its nominee has assumed office, any question
relating to the election, returns and qualifications of the candidates to the House of
Representatives falls under the jurisdiction of the HRET pursuant to Section 17,
Article VI of the 1987 Constitution. Thus, Lokin should raise the question he poses
herein either in an election protest or in a special civil action for quo warranto in the
HRET, not in a special civil action for certiorari in this Court.
We do not agree.
An election protest proposes to oust the winning candidate from office. It is strictly
a contest between the defeated and the winning candidates, based on the grounds
of electoral frauds and irregularities, to determine who between them has actually
obtained the majority of the legal votes cast and is entitled to hold the office. It can
only be filed by a candidate who has duly filed a certificate of candidacy and has
been voted for in the preceding elections.
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A special civil action for quo warranto refers to questions of disloyalty to the State,
or of ineligibility of the winning candidate. The objective of the action is to unseat
the ineligible person from the office, but not to install the petitioner in his place. Any
voter may initiate the action, which is, strictly speaking, not a contest where the
parties strive for supremacy because the petitioner will not be seated even if the
respondent may be unseated.
The controversy involving Lokin is neither an election protest nor an action for quo
warranto, for it concerns a very peculiar situation in which Lokin is seeking to be
seated as the second nominee of CIBAC. Although an election protest may
properly be available to one party-list organization seeking to unseat another party-
list organization to determine which between the defeated and the winning party-
list organizations actually obtained the majority of the legal votes, Lokin’s case is
not one in which a nominee of a particular party-list organization thereby wants to
unseat another nominee of the same party-list organization. Neither does an action
for quo warranto lie, considering that the case does not involve the ineligibility and
disloyalty of Cruz-Gonzales to the Republic of the Philippines, or some other cause
of disqualification for her.
Lokin has correctly brought this special civil action for certiorari against the
COMELEC to seek the review of the September 14, 2007 resolution of the
COMELEC in accordance with Section 7 of Article IX-A of the 1987 Constitution,
notwithstanding the oath and assumption of office by Cruz-Gonzales. The
constitutional mandate is now implemented by Rule 64 of the 1997 Rules of Civil
Procedure, which provides for the review of the judgments, final orders or
resolutions of the COMELEC and the Commission on Audit. As Rule 64 states, the
mode of review is by a petition for certiorari in accordance with Rule 65 to be filed
in the Supreme Court within a limited period of 30 days. Undoubtedly, the Court
has original and exclusive jurisdiction over Lokin’s petitions for certiorari and for
mandamus against the COMELEC.
B nominees of concerned parties, organizations and coalitions with pending disputes
Petitioner is not guilty of forum shopping
Forum shopping consists of the filing of multiple suits involving the same parties for
the same cause of action, either simultaneously or successively, for the purpose of
obtaining a favorable judgment. Thus, forum shopping may arise: (a) whenever as
a result of an adverse decision in one forum, a party seeks a favorable decision
(other than by appeal or certiorari) in another; or (b) if, after having filed a petition
in the Supreme Court, a party files another petition in the Court of Appeals,
because he thereby deliberately splits appeals "in the hope that even as one case
in which a particular remedy is sought is dismissed, another case (offering a
similar remedy) would still be open"; or (c) where a party attempts to obtain a writ
of preliminary injunction from a court after failing to obtain the writ from another
court.19
What is truly important to consider in determining whether forum shopping exists or
not is the vexation caused to the courts and the litigants by a party who accesses
different courts and administrative agencies to rule on the same or related causes
or to grant the same or substantially the same reliefs, in the process creating the
possibility of conflicting decisions being rendered by the different fora upon the
same issue.20
The filing of identical petitions in different courts is prohibited, because such act
constitutes forum shopping, a malpractice that is proscribed and condemned as
trifling with the courts and as abusing their processes. Forum shopping is an
improper conduct that degrades the administration of justice.21
Nonetheless, the mere filing of several cases based on the same incident does not
necessarily constitute forum shopping. The test is whether the several actions filed
involve the same transactions and the same essential facts and
circumstances.22 The actions must also raise identical causes of action, subject
matter, and issues.23 Elsewise stated, forum shopping exists where the elements
of litis pendentia are present, or where a final judgment in one case will amount
to res judicata in the other.24
Lokin has filed the petition for mandamus to compel the COMELEC to proclaim
him as the second nominee of CIBAC upon the issuance of NBC Resolution No.
07-72 (announcing CIBAC’s entitlement to an additional seat in the House of
Representatives), and to strike down the provision in NBC Resolution No. 07-60
and NBC Resolution No. 07-72 holding in abeyance "all proclamation of the
shall likewise be held in abeyance until final resolution of their respective cases."
He has insisted that the COMELEC had the ministerial duty to proclaim him due to
his being CIBAC’s second nominee; and that the COMELEC had no authority to
exercise discretion and to suspend or defer the proclamation of winning party-list
organizations with pending disputes.
On the other hand, Lokin has resorted to the petition for certiorari to assail the
September 14, 2007 resolution of the COMELEC (approving the withdrawal of the
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nomination of Lokin, Tugna and Galang and the substitution by Cruz-Gonzales as
the second nominee and Borje as the third nominee); and to challenge the validity
of Section 13 of Resolution No. 7804, the COMELEC’s basis for allowing CIBAC’s
withdrawal of Lokin’s nomination.
Applying the test for forum shopping, the consecutive filing of the action for
certiorari and the action for mandamus did not violate the rule against forum
shopping even if the actions involved the same parties, because they were based
on different causes of action and the reliefs they sought were different.
C 1. Its promulgation must be authorized by the Legislature;
Invalidity of Section 13 of Resolution No. 7804
The legislative power of the Government is vested exclusively in the Legislature in
accordance with the doctrine of separation of powers. As a general rule, the
Legislature cannot surrender or abdicate its legislative power, for doing so will be
unconstitutional. Although the power to make laws cannot be delegated by the
Legislature to any other authority, a power that is not legislative in character may
be delegated.25
Under certain circumstances, the Legislature can delegate to executive officers
and administrative boards the authority to adopt and promulgate IRRs. To render
such delegation lawful, the Legislature must declare the policy of the law and fix
the legal principles that are to control in given cases. The Legislature should set a
definite or primary standard to guide those empowered to execute the law. For as
long as the policy is laid down and a proper standard is established by statute,
there can be no unconstitutional delegation of legislative power when the
Legislature leaves to selected instrumentalities the duty of making subordinate
rules within the prescribed limits, although there is conferred upon the executive
officer or administrative board a large measure of discretion. There is a distinction
between the delegation of power to make a law and the conferment of an authority
or a discretion to be exercised under and in pursuance of the law, for the power to
make laws necessarily involves a discretion as to what it shall be. 26
The authority to make IRRs in order to carry out an express legislative purpose, or
to effect the operation and enforcement of a law is not a power exclusively
legislative in character, but is rather administrative in nature. The rules and
regulations adopted and promulgated must not, however, subvert or be contrary to
existing statutes. The function of promulgating IRRs may be legitimately exercised
only for the purpose of carrying out the provisions of a law. The power of
administrative agencies is confined to implementing the law or putting it into effect.
Corollary to this is that administrative regulation cannot extend the law and amend
a legislative enactment. It is axiomatic that the clear letter of the law is controlling
and cannot be amended by a mere administrative rule issued for its
implementation. Indeed, administrative or executive acts shall be valid only when
they are not contrary to the laws or the Constitution. 27
To be valid, therefore, the administrative IRRs must comply with the following
requisites to be valid:28
2. It must be within the scope of the authority given by the Legislature;
3. It must be promulgated in accordance with the prescribed procedure;
and
4. It must be reasonable.
The COMELEC is constitutionally mandated to enforce and administer all laws and
regulations relative to the conduct of an election, a plebiscite, an initiative, a
referendum, and a recall.29 In addition to the powers and functions conferred upon
it by the Constitution, the COMELEC is also charged to promulgate IRRs
implementing the provisions of the Omnibus Election Code or other laws that the
COMELEC enforces and administers.30
The COMELEC issued Resolution No. 7804 pursuant to its powers under the
Constitution, Batas Pambansa Blg. 881, and the Party-List System Act.31 Hence,
the COMELEC met the first requisite.
The COMELEC also met the third requisite. There is no question that Resolution
No. 7804 underwent the procedural necessities of publication and dissemination in
accordance with the procedure prescribed in the resolution itself.
Whether Section 13 of Resolution No. 7804 was valid or not is thus to be tested on
the basis of whether the second and fourth requisites were met. It is in this respect
that the challenge of Lokin against Section 13 succeeds.
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As earlier said, the delegated authority must be properly exercised. This simply
means that the resulting IRRs must not be ultra vires as to be issued beyond the
limits of the authority conferred. It is basic that an administrative agency cannot
amend an act of Congress,32 for administrative IRRs are solely intended to carry
out, not to supplant or to modify, the law. The administrative agency issuing the
IRRs may not enlarge, alter, or restrict the provisions of the law it administers and
enforces, and cannot engraft additional non-contradictory requirements not
contemplated by the Legislature.33
Section 8 of R.A. No. 7941 reads:
Section 8. Nomination of Party-List Representatives.-Each registered party,
organization or coalition shall submit to the COMELEC not later that forty-five (45)
days before the election a list of names, not less than five (5), from which party-list
representatives shall be chosen in case it obtains the required number of votes.
A person may be nominated in one (1) list only. Only persons who have given their
consent in writing may be named in the list. The list shall not include any candidate
of any elective office or a person who has lost his bid for an elective office in the
immediately preceding election. No change of names or alteration of the order of
nominees shall be allowed after the same shall have been submitted to the
COMELEC except in cases where the nominee dies, or withdraws in writing his
nomination, becomes incapacitated in which case the name of the substitute
nominee shall be placed last in the list. Incumbent sectoral representatives in the
House of Representatives who are nominated in the party-list system shall not be
considered resigned.
The provision is daylight clear. The Legislature thereby deprived the party-list
organization of the right to change its nominees or to alter the order of nominees
once the list is submitted to the COMELEC, except when: (a) the nominee dies; (b)
the nominee withdraws in writing his nomination; or (c) the nominee becomes
incapacitated. The provision must be read literally because its language is plain
and free from ambiguity, and expresses a single, definite, and sensible meaning.
Such meaning is conclusively presumed to be the meaning that the Legislature
has intended to convey. Even where the courts should be convinced that the
Legislature really intended some other meaning, and even where the literal
interpretation should defeat the very purposes of the enactment, the explicit
declaration of the Legislature is still the law, from which the courts must not
depart.34 When the law speaks in clear and categorical language, there is no
reason for interpretation or construction, but only for application.35Accordingly, an
administrative agency tasked to implement a statute may not construe it by
expanding its meaning where its provisions are clear and unambiguous.36
The legislative intent to deprive the party-list organization of the right to change the
nominees or to alter the order of the nominees was also expressed during the
deliberations of the Congress, viz:
MR. LAGMAN: And again on Section 5, on the nomination of party list
representatives, I do not see any provision here which prohibits or for that matter
allows the nominating party to change the nominees or to alter the order of
prioritization of names of nominees. Is the implication correct that at any time after
submission the names could still be changed or the listing altered?
MR. ABUEG: Mr. Speaker, that is a good issue brought out by the distinguished
Gentleman from Albay and perhaps a perfecting amendment may be introduced
therein. The sponsoring committee will gladly consider the same.
MR. LAGMAN: In other words, what I would like to see is that after the list is
submitted to the COMELEC officially, no more changes should be made in the
names or in the order of listing.
MR. ABUEG: Mr. Speaker, there may be a situation wherein the name of a
particular nominee has been submitted to the Commission on Elections but before
election day the nominee changed his political party affiliation. The nominee is
therefore no longer qualified to be included in the party list and the political party
has a perfect right to change the name of that nominee who changed his political
party affiliation.
MR. LAGMAN: Yes of course. In that particular case, the change can be effected
but will be the exception rather than the rule. Another exception most probably is
the nominee dies, then there has to be a change but any change for that matter
should always be at the last part of the list so that the prioritization made by the
party will not be adversely affected.37
The usage of "No" in Section 8 – "No change of names or alteration of the order of
nominees shall be allowed after the same shall have been submitted to the
COMELEC except in cases where the nominee dies, or withdraws in writing his
nomination, or becomes incapacitated, in which case the name of the substitute
nominee shall be placed last in the list" – renders Section 8 a negative law, and is
indicative of the legislative intent to make the statute mandatory. Prohibitive or
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negative words can rarely, if ever, be directory, for there is but one way to obey the
command "thou shall not," and that is to completely refrain from doing the
forbidden act,38 subject to certain exceptions stated in the law itself, like in this
case.
Section 8 does not unduly deprive the party-list organization of its right to choose
its nominees, but merely divests it of the right to change its nominees or to alter
the order in the list of its nominees’ names after submission of the list to the
COMELEC.
The prohibition is not arbitrary or capricious; neither is it without reason on the part
of lawmakers. The COMELEC can rightly presume from the submission of the list
that the list reflects the true will of the party-list organization. The COMELEC will
not concern itself with whether or not the list contains the real intended nominees
of the party-list organization, but will only determine whether the nominees pass all
the requirements prescribed by the law and whether or not the nominees possess
all the qualifications and none of the disqualifications. Thereafter, the names of the
nominees will be published in newspapers of general circulation. Although the
people vote for the party-list organization itself in a party-list system of election, not
for the individual nominees, they still have the right to know who the nominees of
any particular party-list organization are. The publication of the list of the party-list
nominees in newspapers of general circulation serves that right of the people,
enabling the voters to make intelligent and informed choices. In contrast, allowing
the party-list organization to change its nominees through withdrawal of their
nominations, or to alter the order of the nominations after the submission of the list
of nominees circumvents the voters’ demand for transparency. The lawmakers’
exclusion of such arbitrary withdrawal has eliminated the possibility of such
circumvention.
D to a nomination. In any of these cases, the name of the substitute nominee shall
Exceptions in Section 8 of R.A. 7941 are exclusive
Section 8 of R.A. No. 7941 enumerates only three instances in which the party-list
organization can substitute another person in place of the nominee whose name
has been submitted to the COMELEC, namely: (a) when the nominee dies; (b)
when the nominee withdraws in writing his nomination; and (c) when the nominee
becomes incapacitated.
The enumeration is exclusive, for, necessarily, the general rule applies to all cases
not falling under any of the three exceptions.
When the statute itself enumerates the exceptions to the application of the general
rule, the exceptions are strictly but reasonably construed. The exceptions extend
only as far as their language fairly warrants, and all doubts should be resolved in
favor of the general provision rather than the exceptions. Where the general rule is
established by a statute with exceptions, none but the enacting authority can
curtail the former. Not even the courts may add to the latter by implication, and it is
a rule that an express exception excludes all others, although it is always proper in
determining the applicability of the rule to inquire whether, in a particular case, it
accords with reason and justice.391avvphi1
The appropriate and natural office of the exception is to exempt something from
the scope of the general words of a statute, which is otherwise within the scope
and meaning of such general words. Consequently, the existence of an exception
in a statute clarifies the intent that the statute shall apply to all cases not excepted.
Exceptions are subject to the rule of strict construction; hence, any doubt will be
resolved in favor of the general provision and against the exception. Indeed, the
liberal construction of a statute will seem to require in many circumstances that the
exception, by which the operation of the statute is limited or abridged, should
receive a restricted construction.
E
Section 13 of Resolution No. 7804 expanded
the exceptions under Section 8 of R.A. No. 7941
Section 13 of Resolution No. 7804 states:
Section 13. Substitution of nominees. – A party-list nominee may be substituted
only when he dies, or his nomination is withdrawn by the party, or he
becomes incapacitated to continue as such, or he withdraws his acceptance
be placed last in the list of nominees.
No substitution shall be allowed by reason of withdrawal after the polls.
Unlike Section 8 of R.A. No. 7941, the foregoing regulation provides four
instances, the fourth being when the "nomination is withdrawn by the party."
Lokin insists that the COMELEC gravely abused its discretion in expanding to four
the three statutory grounds for substituting a nominee.
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We agree with Lokin.
The COMELEC, despite its role as the implementing arm of the Government in the
enforcement and administration of all laws and regulations relative to the conduct
of an election,40 has neither the authority nor the license to expand, extend, or add
anything to the law it seeks to implement thereby. The IRRs the COMELEC issues
for that purpose should always accord with the law to be implemented, and should
not override, supplant, or modify the law. It is basic that the IRRs should remain
consistent with the law they intend to carry out. 41
Indeed, administrative IRRs adopted by a particular department of the Government
under legislative authority must be in harmony with the provisions of the law, and
should be for the sole purpose of carrying the law’s general provisions into effect.
The law itself cannot be expanded by such IRRs, because an administrative
agency cannot amend an act of Congress.42
The COMELEC explains that Section 13 of Resolution No. 7804 has added
nothing to Section 8 of R.A. No. 7941,43because it has merely reworded and
rephrased the statutory provision’s phraseology.
The explanation does not persuade.
To reword means to alter the wording of or to restate in other words; to rephrase is
to phrase anew or in a new form.44 Both terms signify that the meaning of the
original word or phrase is not altered.
However, the COMELEC did not merely reword or rephrase the text of Section 8 of
R.A. No. 7941, because it established an entirely new ground not found in the text
of the provision. The new ground granted to the party-list organization the
unilateral right to withdraw its nomination already submitted to the COMELEC,
which Section 8 of R.A. No. 7941 did not allow to be done. Neither was the grant of
the unilateral right contemplated by the drafters of the law, who precisely denied
the right to withdraw the nomination (as the quoted record of the deliberations of
the House of Representatives has indicated). The grant thus conflicted with the
statutory intent to save the nominee from falling under the whim of the party-list
organization once his name has been submitted to the COMELEC, and to spare
the electorate from the capriciousness of the party-list organizations.
We further note that the new ground would not secure the object of R.A. No. 7941
of developing and guaranteeing a full, free and open party-list electoral system.
The success of the system could only be ensured by avoiding any arbitrariness on
the part of the party-list organizations, by seeing to the transparency of the system,
and by guaranteeing that the electorate would be afforded the chance of making
intelligent and informed choices of their party-list representatives.
The insertion of the new ground was invalid. An axiom in administrative law
postulates that administrative authorities should not act arbitrarily and capriciously
in the issuance of their IRRs, but must ensure that their IRRs are reasonable and
fairly adapted to secure the end in view. If the IRRs are shown to bear no
reasonable relation to the purposes for which they were authorized to be issued,
they must be held to be invalid and should be struck down.45
F
Effect of partial nullity of Section 13 of Resolution No. 7804
An IRR adopted pursuant to the law is itself law.46 In case of conflict between the
law and the IRR, the law prevails. There can be no question that an IRR or any of
its parts not adopted pursuant to the law is no law at all and has neither the force
nor the effect of law.47 The invalid rule, regulation, or part thereof cannot be a valid
source of any right, obligation, or power.
Considering that Section 13 of Resolution No. 7804 – to the extent that it allows
the party-list organization to withdraw its nomination already submitted to the
COMELEC – was invalid, CIBAC’s withdrawal of its nomination of Lokin and the
others and its substitution of them with new nominees were also invalid and
ineffectual. It is clear enough that any substitution of Lokin and the others could
only be for any of the grounds expressly stated in Section 8 of R.A. No. 7941.
Resultantly, the COMELEC’s approval of CIBAC’s petition of withdrawal of the
nominations and its recognition of CIBAC’s substitution, both through its assailed
September 14, 2007 resolution, should be struck down for lack of legal basis.
Thereby, the COMELEC acted without jurisdiction, having relied on the invalidly
issued Section 13 of Resolution No. 7804 to support its action.
WHEREFORE, we grant the petitions for certiorari and mandamus.
We declare Section 13 of Resolution No. 7804 invalid and of no effect to the extent
that it authorizes a party-list organization to withdraw its nomination of a nominee
once it has submitted the nomination to the Commission on Elections.
Accordingly, we annul and set aside:
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 (a) The resolution dated September 14, 2007 issued in E. M. No. 07-054
approving Citizens’ Battle Against Corruption’s withdrawal of the
nominations of Luis K. Lokin, Jr., Sherwin N. Tugna, and Emil Galang as
its second, third, and fourth nominees, respectively, and ordering their
substitution by Cinchona C. Cruz-Gonzales as second nominee and Armi
Jane R. Borje as third nominee; and
(b) The proclamation by the Commission on Elections of Cinchona C.
Cruz-Gonzales as a Party-List Representative representing Citizens’ Battle
Against Corruption in the House of Representatives.
We order the Commission on Elections to forthwith proclaim petitioner Luis K.
Lokin, Jr. as a Party-List Representative representing Citizens’ Battle Against
Corruption in the House of Representatives.
We make no pronouncements on costs of suit.
SO ORDERED.
G.R. No. 195229 October 9, 2012
EFREN RACEL ARA TEA, Petitioner,
vs.
COMMISSiON ON ELECTIONS and ESTELA D. ANTlPOLO, Respondents.
DECISION
CARPIO, J.:
The Case
This is a special civil action for certiorari1 seeking to review and nullify the
Resolution2 dated 2 February 2011 and the Order3 dated 12 January 2011 of the
Commission on Elections (COMELEC) En Banc in Dra. Sigrid S. Rodolfo v.
Romeo D. Lonzanida, docketed as SPA No. 09-158 (DC). The petition asserts that
the COMELEC issued the Resolution and Order with grave abuse of discretion
amounting to lack or excess of jurisdiction.
The Facts
Romeo D. Lonzanida (Lonzanida) and Estela D. Antipolo (Antipolo) were
candidates for Mayor of San Antonio, Zambales in the May 2010 National and
Local Elections. Lonzanida filed his certificate of candidacy on 1 December
2009.4 On 8 December 2009, Dra. Sigrid S. Rodolfo (Rodolfo) filed a petition under
Section 78 of the Omnibus Election Code to disqualify Lonzanida and to deny due
course or to cancel Lonzanida’s certificate of candidacy on the ground that
Lonzanida was elected, and had served, as mayor of San Antonio, Zambales for
four (4) consecutive terms immediately prior to the term for the May 2010
elections. Rodolfo asserted that Lonzanida made a false material representation in
his certificate of candidacy when Lonzanida certified under oath that he was
eligible for the office he sought election. Section 8, Article X of the 1987
Constitution5 and Section 43(b) of the Local Government Code6 both prohibit a
local elective official from being elected and serving for more than three
consecutive terms for the same position.
The COMELEC Second Division rendered a Resolution7 on 18 February 2010
cancelling Lonzanida’s certificate of candidacy. Pertinent portions of the 18
February 2010 Resolution read:
Respondent Lonzanida never denied having held the office of mayor of San
Antonio, Zambales for more than nine consecutive years. Instead he raised
arguments to forestall or dismiss the petition on the grounds other than the main
issue itself. We find such arguments as wanting. Respondent Lonzanida, for
holding the office of mayor for more than three consecutive terms, went against the
three-term limit rule; therefore, he could not be allowed to run anew in the 2010
elections. It is time to infuse new blood in the political arena of San Antonio.
WHEREFORE, premises considered, the instant petition is hereby GRANTED.
The Certificate of Candidacy of Respondent Romeo D. Lonzanida for the position
of mayor in the municipality of San Antonio, Zambales is hereby CANCELLED. His
name is hereby ordered STRICKEN OFF the list of Official Candidates for the
position of Mayor of San Antonio, Zambales in May 10, 2010 elections.
SO ORDERED.8
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Lonzanida’s motion for reconsideration before the COMELEC En Banc remained
pending during the May 2010 elections. Lonzanida and Efren Racel Aratea
(Aratea) garnered the highest number of votes and were respectively proclaimed
Mayor and Vice-Mayor.
Aratea took his oath of office as Acting Mayor before Regional Trial Court (RTC)
Judge Raymond C. Viray of Branch 75, Olongapo City on 5 July 2010. 9 On the
same date, Aratea wrote the Department of Interior and Local Government (DILG)
and requested for an opinion on whether, as Vice-Mayor, he was legally required
to assume the Office of the Mayor in view of Lonzanida’s disqualification. DILG
Legal Opinion No. 117, S. 201010 stated that Lonzanida was disqualified to hold
office by reason of his criminal conviction. As a consequence of Lonzanida’s
disqualification, the Office of the Mayor was deemed permanently vacant. Thus,
Aratea should assume the Office of the Mayor in an acting capacity without
prejudice to the COMELEC’s resolution of Lonzanida’s motion for reconsideration.
In another letter dated 6 August 2010, Aratea requested the DILG to allow him to
take the oath of office as Mayor of San Antonio, Zambales. In his response dated
24 August 2010, then Secretary Jesse M. Robredo allowed Aratea to take an oath
of office as "the permanent Municipal Mayor of San Antonio, Zambales without
prejudice however to the outcome of the cases pending before the [COMELEC]."11
On 11 August 2010, the COMELEC En Banc issued a Resolution12 disqualifying
Lonzanida from running for Mayor in the May 2010 elections. The COMELEC En
Banc’s resolution was based on two grounds: first, Lonzanida had been elected
and had served as Mayor for more than three consecutive terms without
interruption; and second, Lonzanida had been convicted by final judgment of ten
(10) counts of falsification under the Revised Penal Code. Lonzanida was
sentenced for each count of falsification to imprisonment of four (4) years and one
(1) day of prisión correccional as minimum, to eight (8) years and one (1) day
of prisión mayor as maximum. The judgment of conviction became final on 23
October 2009 in the Decision of this Court in Lonzanida v. People,13 before
Lonzanida filed his certificate of candidacy on 1 December 2009. Pertinent
portions of the 11 August 2010 Resolution read:
Prescinding from the foregoing premises, Lonzanida, for having served as Mayor
of San Antonio, Zambales for more than three (3) consecutive terms and for
having been convicted by a final judgment of a crime punishable by more than one
(1) year of imprisonment, is clearly disqualified to run for the same position in the
May 2010 Elections.
WHEREFORE, in view of the foregoing, the Motion for Reconsideration is hereby
DENIED.
SO ORDERED.14
On 25 August 2010, Antipolo filed a Motion for Leave to Intervene and to Admit
Attached Petition-in-Intervention.15She claimed her right to be proclaimed as
Mayor of San Antonio, Zambales because Lonzanida ceased to be a candidate
when the COMELEC Second Division, through its 18 February 2010 Resolution,
ordered the cancellation of his certificate of candidacy and the striking out of his
name from the list of official candidates for the position of Mayor of San Antonio,
Zambales in the May 2010 elections.
In his Comment filed on 26 January 2011, Aratea asserted that Antipolo, as the
candidate who received the second highest number of votes, could not be
proclaimed as the winning candidate. Since Lonzanida’s disqualification was not
yet final during election day, the votes cast in his favor could not be declared stray.
Lonzanida’s subsequent disqualification resulted in a permanent vacancy in the
Office of Mayor, and Aratea, as the duly-elected Vice-Mayor, was mandated by
Section 4416 of the Local Government Code to succeed as Mayor.
The COMELEC’s Rulings
The COMELEC En Banc issued an Order dated 12 January 2011, stating:
Acting on the "Motion for Leave to Intervene and to Admit Attached Petition-in-
Intervention" filed by Estela D. Antipolo (Antipolo) and pursuant to the power of this
Commission to suspend its Rules or any portion thereof in the interest of justice,
this Commission hereby RESOLVES to:
1. GRANT the aforesaid Motion;
2. ADMIT the Petition-in-Intervention filed by Antipolo;
3. REQUIRE the Respondent, ROMEO DUMLAO LONZANIDA, as well as EFREN
RACEL ARATEA, proclaimed Vice-Mayor of San Antonio, Zambales, to file their
respective Comments on the Petition-in- Intervention within a non-extendible
period of five (5) days from receipt thereof;
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4. SET the above-mentioned Petition-in-Intervention for hearing on January 26,
2011 at 10:00 a.m. COMELEC Session Hall, 8th Floor, Palacio del Gobernador,
Intramuros, Manila.
WHEREFORE, furnish copies hereof the parties for their information and
compliance.
SO ORDERED.17
In its Resolution dated 2 February 2011, the COMELEC En Banc no longer
considered Lonzanida’s qualification as an issue: "It is beyond cavil that Lonzanida
is not eligible to hold and discharge the functions of the Office of the Mayor of San
Antonio, Zambales. The sole issue to be resolved at this juncture is how to fill the
vacancy resulting from Lonzanida’s disqualification."18 The Resolution further
stated:
We cannot sustain the submission of Oppositor Aratea that Intervenor Antipolo
could never be proclaimed as the duly elected Mayor of Antipolo [sic] for being a
second placer in the elections. The teachings in the cases of Codilla vs. De
Venecia and Nazareno and Domino vs. COMELEC, et al., while they remain sound
jurisprudence find no application in the case at bar. What sets this case apart from
the cited jurisprudence is that the notoriety of Lonzanida’s disqualification and
ineligibility to hold public office is established both in fact and in law on election day
itself. Hence, Lonzanida’s name, as already ordered by the Commission on
February 18, 2010 should have been stricken off from the list of official candidates
for Mayor of San Antonio, Zambales.
WHEREFORE, in view of the foregoing, the Commission hereby:
1. Declares NULL and VOID the proclamation of respondent ROMEO D.
LONZANIDA;
2. GRANTS the Petition for Intervention of Estela D. Antipolo;
3. Orders the immediate CONSTITUTION of a Special Municipal Board of
Canvassers to PROCLAIM Intervenor Estela D. Antipolo as the duly elected Mayor
of San Antonio, Zambales;
4. Orders Vice-Mayor Efren Racel Aratea to cease and desist from discharging the
functions of the Office of the Mayor, and to cause a peaceful turn-over of the said
office to Antipolo upon her proclamation; and
5. Orders the Office of the Executive Director as well as the Regional Election
Director of Region III to cause the implementation of this Resolution and
disseminate it to the Department of Interior and Local Government.
SO ORDERED.19
Aratea filed the present petition on 9 February 2011.
The Issues
The manner of filling up the permanent vacancy in the Office of the Mayor of San
Antonio, Zambales is dependent upon the determination of Lonzanida’s removal.
Whether Lonzanida was disqualified under Section 68 of the Omnibus Election
Code, or made a false material representation under Section 78 of the same
Code that resulted in his certificate of candidacy being void ab initio, is
determinative of whether Aratea or Antipolo is the rightful occupant to the Office of
the Mayor of San Antonio, Zambales.
The dissenting opinions reverse the COMELEC’s 2 February 2011 Resolution and
12 January 2011 Order. They hold that Aratea, the duly elected Vice-Mayor of San
Antonio, Zambales, should be declared Mayor pursuant to the Local Government
Code’s rule on succession.
The dissenting opinions make three grave errors: first, they ignore prevailing
jurisprudence that a false representation in the certificate of candidacy as to
eligibility in the number of terms elected and served is a material fact that is a
ground for a petition to cancel a certificate of candidacy under Section 78; second,
they ignore that a false representation as to eligibility to run for public office due to
the fact that the candidate suffers from perpetual special disqualification is a
material fact that is a ground for a petition to cancel a certificate of candidacy
under Section 78; and third, they resort to a strained statutory construction to
conclude that the violation of the three-term limit rule cannot be a ground for
cancellation of a certificate of candidacy under Section 78, even when it is clear
and plain that violation of the three-term limit rule is an ineligibility affecting the
qualification of a candidate to elective office.
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The dissenting opinions tread on dangerous ground when they assert that a
candidate’s eligibility to the office he seeks election must be strictly construed to
refer only to the details, i.e., age, citizenship, or residency, among others, which
the law requires him to state in his COC, and which he must swear under oath to
possess. The dissenting opinions choose to view a false certification of a
candidate’s eligibility on the three-term limit rule not as a ground for false material
representation under Section 78 but as a ground for disqualification under Section
68 of the same Code. This is clearly contrary to well-established jurisprudence.
The Court’s Ruling
We hold that Antipolo, the alleged "second placer," should be proclaimed Mayor
because Lonzanida’s certificate of candidacy was void ab initio. In short,
Lonzanida was never a candidate at all. All votes for Lonzanida were stray votes.
Thus, Antipolo, the only qualified candidate, actually garnered the highest number
of votes for the position of Mayor.
Qualifications and Disqualifications
Section 65 of the Omnibus Election Code points to the Local Government Code for
the qualifications of elective local officials. Paragraphs (a) and (c) of Section 39
and Section 40 of the Local Government Code provide in pertinent part:
Sec. 39. Qualifications. ‒ (a) An elective local official must be a citizen of the
Philippines; a registered voter in the barangay, municipality, city or province x x x;
a resident therein for at least one (1) year immediately preceding the day of the
election; and able to read and write Filipino or any other local language or dialect.
xxxx
(c) Candidates for the position of mayor or vice-mayor of independent component
cities, component cities, or municipalities must be at least twenty-one (21) years of
age on election day.
xxxx
Sec. 40. Disqualifications. - The following persons are disqualified from running for
any elective local position:
(a) Those sentenced by final judgment for an offense involving moral
turpitude or for an offense punishable by one (1) year or more of
imprisonment, within two (2) years after serving sentence;
(b) Those removed from office as a result of an administrative case;
(c) Those convicted by final judgment for violating the oath of allegiance to the
Republic;
(d) Those with dual citizenship;
(e) Fugitives from justice in criminal or non-political cases here or abroad;
(f) Permanent residents in a foreign country or those who have acquired the right
to reside abroad and continue to avail of the same right after the effectivity of this
Code; and
(g) The insane or feeble-minded. (Emphasis supplied)
Section 12 of the Omnibus Election Code provides:
Sec. 12. Disqualification. — Any person who has been declared by competent
authority insane or incompetent, or has been sentenced by final judgment for
subversion, insurrection, rebellion or for any offense for which he was
sentenced to a penalty of more than eighteen months or for a crime
involving moral turpitude, shall be disqualified to be a candidate and to hold any
office, unless he has been given plenary pardon or granted amnesty.
The disqualifications to be a candidate herein provided shall be deemed removed
upon the declaration by competent authority that said insanity or incompetence
had been removed or after the expiration of a period of five years from his service
of sentence, unless within the same period he again becomes disqualified.
(Emphasis supplied)
The grounds for disqualification for a petition under Section 68 of the Omnibus
Election Code are specifically enumerated:
Sec. 68. Disqualifications. ‒ Any candidate who, in an action or protest in which he
is a party is declared by final decision by a competent court guilty of, or found by
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the Commission of having (a) given money or other material consideration to
influence, induce or corrupt the voters or public officials performing
electoral functions; (b) committed acts of terrorism to enhance his
candidacy; (c) spent in his election campaign an amount in excess of that
allowed by this Code; (d) solicited, received or made any contribution
prohibited under Sections 89, 95, 96, 97 and 104; (e) violated any of Sections
80, 83, 85, 86 and 261, paragraphs d, e, k, v, and cc, subparagraph 6, shall be
disqualified from continuing as a candidate, or if he has been elected, from holding
the office. Any person who is a permanent resident of or an immigrant to a foreign
country shall not be qualified to run for any elective office under this Code, unless
said person has waived his status as permanent resident or immigrant of a foreign
country in accordance with the residence requirement provided for in the election
laws. (Emphasis supplied)
A petition for disqualification under Section 68 clearly refers to "the commission of
prohibited acts and possession of a permanent resident status in a foreign
country."20 All the offenses mentioned in Section 68 refer to election offenses
under the Omnibus Election Code, not to violations of other penal laws.
There is absolutely nothing in the language of Section 68 that would justify
including violation of the three-term limit rule, or conviction by final judgment of the
crime of falsification under the Revised Penal Code, as one of the grounds or
offenses covered under Section 68. In Codilla, Sr. v. de Venecia,21 this Court ruled:
[T]he jurisdiction of the COMELEC to disqualify candidates is limited to those
enumerated in Section 68 of the Omnibus Election Code. All other election
offenses are beyond the ambit of COMELEC jurisdiction. They are criminal and not
administrative in nature. x x x
Clearly, the violation by Lonzanida of the three-term limit rule, or his conviction by
final judgment of the crime of falsification under the Revised Penal Code, does not
constitute a ground for a petition under Section 68.
False Material Representation
Section 78 of the Omnibus Election Code states that a certificate of candidacy may
be denied or cancelled when there is false material representation of the
contents of the certificate of candidacy:
Sec. 78. Petition to deny due course to or cancel a certificate of candidacy. ‒ A
verified petition seeking to deny due course or to cancel a certificate of candidacy
may be filed by the person exclusively on the ground that any material
representation contained therein as required under Section 74 hereof is
false. The petition may be filed at any time not later than twenty-five days from the
time of the filing of the certificate of candidacy and shall be decided, after due
notice and hearing, not later than fifteen days before the election. (Emphasis
supplied)
Section 74 of the Omnibus Election Code details the contents of the certificate
of candidacy:
Sec. 74. Contents of certificate of candidacy. ‒ The certificate of candidacy shall
state that the person filing it is announcing his candidacy for the office stated
therein and that he is eligible for said office; if for Member of the Batasang
Pambansa, the province, including its component cities, highly urbanized city or
district or sector which he seeks to represent; the political party to which he
belongs; civil status; his date of birth; residence; his post office address for all
election purposes; his profession or occupation; that he will support and defend the
Constitution of the Philippines and will maintain true faith and allegiance thereto;
that he will obey the laws, legal orders, and decrees promulgated by the duly
constituted authorities; that he is not a permanent resident or immigrant to a
foreign country; that the obligation imposed by his oath is assumed voluntarily,
without mental reservation or purpose of evasion; and that the facts stated in the
certificate of candidacy are true to the best of his knowledge.
x x x x (Emphasis supplied)
A candidate for mayor in the 2010 local elections was thus required to provide 12
items of information in the certificate of candidacy:22 name; nickname or stage
name; gender; age; place of birth; political party that nominated the candidate; civil
status; residence/address; profession or occupation; post office address for
election purposes; locality of which the candidate is a registered voter; and period
of residence in the Philippines before 10 May 2010. The candidate also certifies
four statements: a statement that the candidate is a natural born or naturalized
Filipino citizen; a statement that the candidate is not a permanent resident of, or
immigrant to, a foreign country; a statement that the candidate is eligible for the
office he seeks election; and a statement of the candidate’s allegiance to the
Constitution of the Republic of the Philippines.23 The certificate of candidacy
should also be under oath, and filed within the period prescribed by law.
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The conviction of Lonzanida by final judgment, with the penalty of prisión
mayor, disqualifies him perpetually from holding any public office, or from
being elected to any public office. This perpetual disqualification took effect
upon the finality of the judgment of conviction, before Lonzanida filed his
certificate of candidacy. The pertinent provisions of the Revised Penal Code are
as follows:
Art. 27. Reclusion perpetua. — x x x
Prisión mayor and temporary disqualification. — The duration of the penalties
of prisión mayor and temporary disqualification shall be from six years and
one day to twelve years, except when the penalty of disqualification is
imposed as an accessory penalty, in which case, it shall be that of the
principal penalty.
xxxx
Art. 30. Effects of the penalties of perpetual or temporary absolute disqualification.
— The penalties of perpetual or temporary absolute disqualification for public
office shall produce the following effects:
1. The deprivation of the public offices and employments which the offender
may have held, even if conferred by popular election.
2. The deprivation of the right to vote in any election for any popular elective
office or to be elected to such office.
3. The disqualification for the offices or public employments and for the
exercise of any of the rights mentioned.
In case of temporary disqualification, such disqualification as is comprised in
paragraphs 2 and 3 of this article shall last during the term of the sentence.
4. The loss of all rights to retirement pay or other pension for any office formerly
held.
Art. 31. Effects of the penalties of perpetual or temporary special disqualification.
— The penalties of perpetual or temporary special disqualification for public
office, profession or calling shall produce the following effects:
1. The deprivation of the office, employment, profession or calling affected.
2. The disqualification for holding similar offices or employments either perpetually
or during the term of the sentence, according to the extent of such disqualification.
Art. 32. Effects of the penalties of perpetual or temporary special disqualification
for the exercise of the right of suffrage. — The perpetual or temporary special
disqualification for the exercise of the right of suffrage shall deprive the
offender perpetually or during the term of the sentence, according to the
nature of said penalty, of the right to vote in any popular election for any public
office or to be elected to such office. Moreover, the offender shall not be
permitted to hold any public office during the period of his disqualification.
Art. 42. Prisión mayor — Its accessory penalties. — The penalty of prision mayor
shall carry with it that of temporary absolute disqualification and that
of perpetual special disqualification from the right of suffrage which the offender
shall suffer although pardoned as to the principal penalty, unless the same shall
have been expressly remitted in the pardon. (Emphasis supplied)
The penalty of prisión mayor automatically carries with it, by operation of law,24 the
accessory penalties of temporary absolute disqualification and perpetual special
disqualification. Under Article 30 of the Revised Penal Code, temporary absolute
disqualification produces the effect of "deprivation of the right to vote in any
election for any popular elective office or to be elected to such office.” The duration
of temporary absolute disqualification is the same as that of the principal penalty
of prisión mayor. On the other hand, under Article 32 of the Revised Penal
Code, perpetual special disqualification means that "the offender shall not be
permitted to hold any public office during the period of his
disqualification,” which is perpetually. Both temporary absolute disqualification
and perpetual special disqualification constitute ineligibilities to hold elective public
office. A person suffering from these ineligibilities is ineligible to run for
elective public office, and commits a false material representation if he
states in his certificate of candidacy that he is eligible to so run.
In Lacuna v. Abes (Lacuna),25 the Court, speaking through Justice J.B.L. Reyes,
explained the import of the accessory penalty of perpetual special
disqualification:
On the first defense of respondent-appellee Abes, it must be remembered that
appellee’s conviction of a crime penalized with prision mayor which carried the
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accessory penalties of temporary absolute disqualification and perpetual special
disqualification from the right of suffrage (Article 42, Revised Penal Code); and
Section 99 of the Revised Election Code disqualifies a person from voting if he had
been sentenced by final judgment to suffer one year or more of imprisonment.
The accessory penalty of temporary absolute disqualification disqualifies the
convict for public office and for the right to vote, such disqualification to last only
during the term of the sentence (Article 27, paragraph 3, & Article 30, Revised
Penal Code) that, in the case of Abes, would have expired on 13 October 1961.
But this does not hold true with respect to the other accessory penalty of perpetual
special disqualification for the exercise of the right of suffrage. This accessory
penalty deprives the convict of the right to vote or to be elected to or hold public
office perpetually, as distinguished from temporary special disqualification, which
lasts during the term of the sentence. Article 32, Revised Penal Code, provides:
Art. 32. Effects of the penalties of perpetual or temporary special disqualification
for the exercise of the right of suffrage. — The perpetual or temporary special
disqualification for the exercise of the right of suffrage shall deprive the offender
perpetually or during the term of the sentence, according to the nature of said
penalty, of the right to vote in any popular election for any public office or to be
elected to such office. Moreover, the offender shall not be permitted to hold any
public office during the period of disqualification.
The word "perpetually" and the phrase "during the term of the sentence" should be
applied distributively to their respective antecedents; thus, the word "perpetually"
refers to the perpetual kind of special disqualification, while the phrase "during the
term of the sentence" refers to the temporary special disqualification. The duration
between the perpetual and the temporary (both special) are necessarily different
because the provision, instead of merging their durations into one period, states
that such duration is "according to the nature of said penalty" — which means
according to whether the penalty is the perpetual or the temporary special
disqualification. (Emphasis supplied)
Clearly, Lacuna instructs that the accessory penalty of perpetual special
disqualification "deprives the convict of the right to vote or to be elected to or
hold public office perpetually.”
The accessory penalty of perpetual special disqualification takes effect
immediately once the judgment of conviction becomes final. The effectivity of
this accessory penalty does not depend on the duration of the principal penalty, or
on whether the convict serves his jail sentence or not. The last sentence of Article
32 states that "the offender shall not be permitted to hold any public office during
the period of his [perpetual special] disqualification." Once the judgment of
conviction becomes final, it is immediately executory. Any public office that the
convict may be holding at the time of his conviction becomes vacant upon finality
of the judgment, and the convict becomes ineligible to run for any elective
public office perpetually. In the case of Lonzanida, he became ineligible
perpetually to hold, or to run for, any elective public office from the time the
judgment of conviction against him became final. The judgment of
conviction was promulgated on 20 July 2009 and became final on 23 October
2009, before Lonzanida filed his certificate of candidacy on 1 December 2009
. 26
Perpetual special disqualification is a ground for a petition under Section 78 of
the Omnibus Election Code because this accessory penalty is an ineligibility,
which means that the convict is not eligible to run for public office, contrary to the
statement that Section 74 requires him to state under oath in his certificate of
candidacy. As this Court held in Fermin v. Commission on Elections,27 the false
material representation may refer to "qualifications or eligibility.” One who
suffers from perpetual special disqualification is ineligible to run for public office. If
a person suffering from perpetual special disqualification files a certificate of
candidacy stating under oath that "he is eligible to run for (public) office," as
expressly required under Section 74, then he clearly makes a false material
representation that is a ground for a petition under Section 78. As this Court
explained in Fermin:
Lest it be misunderstood, the denial of due course to or the cancellation of the CoC
is not based on the lack of qualifications but on a finding that the candidate made a
material representation that is false, which may relate to the qualifications
required of the public office he/she is running for. It is noted that the
candidate states in his/her CoC that he/she is eligible for the office he/she
seeks. Section 78 of the OEC, therefore, is to be read in relation to the
constitutional and statutory provisions on qualifications or eligibility for
public office. If the candidate subsequently states a material representation
in the CoC that is false, the COMELEC, following the law, is empowered to
deny due course to or cancel such certificate. Indeed, the Court has already
likened a proceeding under Section 78 to a quo warranto proceeding under
Section 253 of the OEC since they both deal with the eligibility or qualification of a
candidate, with the distinction mainly in the fact that a "Section 78" petition is filed
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before proclamation, while a petition for quo warranto is filed after proclamation of
the winning candidate.28(Emphasis supplied)
Latasa, Rivera and Ong:
The Three-Term Limit Rule as a Ground for Ineligibility
Section 74 requires the candidate to certify that he is eligible for the public
office he seeks election. Thus, Section 74 states that "the certificate of
candidacy shall state that the person filing x x x is eligible for said office.”
The three-term limit rule, enacted to prevent the establishment of political
dynasties and to enhance the electorate’s freedom of choice,29 is found both in the
Constitution30 and the law.31 After being elected and serving for three consecutive
terms, an elective local official cannot seek immediate reelection for the same
office in the next regular election32 because he is ineligible. One who has an
ineligibility to run for elective public office is not "eligible for [the] office." As used in
Section 74, the word "eligible"33 means having the right to run for elective public
office, that is, having all the qualifications and none of the ineligibilities to run for
the public office.
In Latasa v. Commission on Elections,34 petitioner Arsenio Latasa was elected
mayor of the Municipality of Digos, Davao del Sur in 1992, 1995, and 1998. The
Municipality of Digos was converted into the City of Digos during Latasa’s third
term. Latasa filed his certificate of candidacy for city mayor for the 2001 elections.
Romeo Sunga, Latasa’s opponent, filed before the COMELEC a "petition to deny
due course, cancel certificate of candidacy and/or disqualification" under Section
78 on the ground that Latasa falsely represented in his certificate of candidacy that
he is eligible to run as mayor of Digos City. Latasa argued that he did not make
any false representation. In his certificate of candidacy, Latasa inserted a footnote
after the phrase "I am eligible" and indicated "*Having served three (3) term[s] as
municipal mayor and now running for the first time as city mayor." The COMELEC
First Division cancelled Latasa’s certificate of candidacy for violation of the three-
term limit rule but not for false material representation. This Court affirmed the
COMELEC En Banc’s denial of Latasa’s motion for reconsideration.
We cancelled Marino Morales’ certificate of candidacy in Rivera III v. Commission
on Elections (Rivera).35 We held that Morales exceeded the maximum three-term
limit, having been elected and served as Mayor of Mabalacat for four consecutive
terms (1995 to 1998, 1998 to 2001, 2001 to 2004, and 2004 to 2007). We declared
him ineligible as a candidate for the same position for the 2007 to 2010 term.
Although we did not explicitly rule that Morales’ violation of the three-term limit rule
constituted false material representation, we nonetheless granted the petition to
cancel Morales’ certificate of candidacy under Section 78. We also affirmed the
cancellation of Francis Ong’s certificate of candidacy in Ong v. Alegre,36 where the
"petition to disqualify, deny due course and cancel" Ong’s certificate of candidacy
under Section 78 was predicated on the violation of the three-term limit rule.
Loong, Fermin and Munder:
When Possession of a Disqualifying Condition
is Not a Ground for a Petition for Disqualification
It is obvious from a reading of the laws and jurisprudence that there is an overlap
in the grounds for eligibility and ineligibility vis-à-vis qualifications and
disqualifications. For example, a candidate may represent that he is a resident of a
particular Philippine locality37 when he is actually a permanent resident of another
country.38 In cases of such overlap, the petitioner should not be constrained in his
choice of remedy when the Omnibus Election Code explicitly makes available
multiple remedies.39 Section 78 allows the filing of a petition to deny due course or
to cancel a certificate of candidacy before the election, while Section 253 allows
the filing of a petition for quo warranto after the election. Despite the overlap of the
grounds, one should not confuse a petition for disqualification using grounds
enumerated in Section 68 with a petition to deny due course or to cancel a
certificate of candidacy under Section 78.
The distinction between a petition under Section 68 and a petition under Section
78 was discussed in Loong v. Commission on Elections40 with respect to the
applicable prescriptive period. Respondent Nur Hussein Ututalum filed a petition
under Section 78 to disqualify petitioner Benjamin Loong for the office of Regional
Vice-Governor of the Autonomous Government of Muslim Mindanao for false
representation as to his age. The petition was filed 16 days after the election, and
clearly beyond the prescribed 25 day period from the last day of filing certificates of
candidacy. This Court ruled that Ututalum’s petition was one based on false
representation under Section 78, and not for disqualification under Section 68.
Hence, the 25-day prescriptive period provided in Section 78 should be strictly
applied. We recognized the possible gap in the law:
It is true that the discovery of false representation as to material facts required to
be stated in a certificate of candidacy, under Section 74 of the Code, may be made
only after the lapse of the 25-day period prescribed by Section 78 of the Code,
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through no fault of the person who discovers such misrepresentations and who
would want the disqualification of the candidate committing the misrepresentations.
It would seem, therefore, that there could indeed be a gap between the time of the
discovery of the misrepresentation, (when the discovery is made after the 25-day
period under Sec. 78 of the Code has lapsed) and the time when the proclamation
of the results of the election is made. During this so-called "gap" the would-be
petitioner (who would seek the disqualification of the candidate) is left with nothing
to do except to wait for the proclamation of the results, so that he could avail of a
remedy against the misrepresenting candidate, that is, by filing a petition for quo
warranto against him. Respondent Commission sees this "gap" in what it calls a
procedural gap which, according to it, is unnecessary and should be remedied.
At the same time, it can not be denied that it is the purpose and intent of the
legislative branch of the government to fix a definite time within which petitions of
protests related to eligibility of candidates for elective offices must be filed, as seen
in Sections 78 and 253 of the Code. Respondent Commission may have seen the
need to remedy this so-called “procedural gap", but it is not for it to prescribe what
the law does not provide, its function not being legislative. The question of whether
the time to file these petitions or protests is too short or ineffective is one for the
Legislature to decide and remedy.41
In Fermin v. Commission on Elections,42 the issue of a candidate’s possession of
the required one-year residency requirement was raised in a petition for
disqualification under Section 68 instead of a petition to deny due course or to
cancel a certificate of candidacy under Section 78. Despite the question of the
one-year residency being a proper ground under Section 78, Dilangalen, the
petitioner before the COMELEC in Fermin, relied on Section 5(C)(1) and
5(C)(3)(a)(4) of COMELEC Resolution No. 780043 and filed the petition under
Section 68. In Fermin, we ruled that "a COMELEC rule or resolution cannot
supplant or vary legislative enactments that distinguish the grounds for
disqualification from those of ineligibility, and the appropriate proceedings to
raise the said grounds."44 A petition for disqualification can only be premised on a
ground specified in Section 12 or 68 of the Omnibus Election Code or Section 40
of the Local Government Code. Thus, a petition questioning a candidate’s
possession of the required one-year residency requirement, as distinguished from
permanent residency or immigrant status in a foreign country, should be filed
under Section 78, and a petition under Section 68 is the wrong remedy.
In Munder v. Commission on Elections,45 petitioner Alfais Munder filed a certificate
of candidacy for Mayor of Bubong, Lanao del Sur on 26 November 2009.
Respondent Atty. Tago Sarip filed a petition for Munder’s disqualification on 13
April 2010. Sarip claimed that Munder misrepresented that he was a registered
voter of Bubong, Lanao del Sur, and that he was eligible to register as a voter in
2003 even though he was not yet 18 years of age at the time of the voter’s
registration. Moreover, Munder’s certificate of candidacy was not accomplished in
full as he failed to indicate his precinct and did not affix his thumb-mark. The
COMELEC Second Division dismissed Sarip’s petition and declared that his
grounds are not grounds for disqualification under Section 68 but for denial or
cancellation of Munder’s certificate of candidacy under Section 78. Sarip’s petition
was filed out of time as he had only 25 days after the filing of Munder’s certificate
of candidacy, or until 21 December 2009, within which to file his petition.
The COMELEC En Banc, however, disqualified Munder. In reversing the
COMELEC Second Division, the COMELEC En Banc did not rule on the propriety
of Sarip’s remedy but focused on the question of whether Munder was a registered
voter of Bubong, Lanao del Sur. This Court reinstated the COMELEC Second
Division’s resolution. This Court ruled that the ground raised in the petition, lack of
registration as voter in the locality where he was running as a candidate, is
inappropriate for a petition for disqualification. We further declared that with our
ruling in Fermin, we had already rejected the claim that lack of substantive
qualifications of a candidate is a ground for a petition for disqualification under
Section 68. The only substantive qualification the absence of which is a ground for
a petition under Section 68 is the candidate’s permanent residency or immigrant
status in a foreign country.
The dissenting opinions place the violation of the three-term limit rule as a
disqualification under Section 68 as the violation allegedly is "a status,
circumstance or condition which bars him from running for public office despite the
possession of all the qualifications under Section 39 of the [Local Government
Code]." In so holding the dissenting opinions write in the law what is not found in
the law. Section 68 is explicit as to the proper grounds for disqualification under
said Section. The grounds for filing a petition for disqualification under Section 68
are specifically enumerated in said Section. However, contrary to the specific
enumeration in Section 68 and contrary to prevailing jurisprudence, the dissenting
opinions add to the enumerated grounds the violation of the three-term limit rule
and falsification under the Revised Penal Code, which are obviously not found in
the enumeration in Section 68.
The dissenting opinions equate Lonzanida’s possession of a disqualifying
condition (violation of the three-term limit rule) with the grounds for disqualification
under Section 68. Section 68 is explicit as to the proper grounds for
disqualification: the commission of specific prohibited acts under the Omnibus
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Election Code and possession of a permanent residency or immigrant status in a
foreign country. Any other false representation regarding a material fact should be
filed under Section 78, specifically under the candidate’s certification of his
eligibility. In rejecting a violation of the three-term limit as a condition for eligibility,
the dissenting opinions resort to judicial legislation, ignoring the verba
legis doctrine and well-established jurisprudence on this very issue.
In a certificate of candidacy, the candidate is asked to certify under oath his
eligibility, and thus qualification, to the office he seeks election. Even though the
certificate of candidacy does not specifically ask the candidate for the number of
terms elected and served in an elective position, such fact is material in
determining a candidate’s eligibility, and thus qualification for the office. Election to
and service of the same local elective position for three consecutive terms renders
a candidate ineligible from running for the same position in the succeeding
elections. Lonzanida misrepresented his eligibility because he knew full well that
he had been elected, and had served, as mayor of San Antonio, Zambales for
more than three consecutive terms yet he still certified that he was eligible to run
for mayor for the next succeeding term. Thus, Lonzanida’s representation that he
was eligible for the office that he sought election constitutes false material
representation as to his qualification or eligibility for the office.
Legal Duty of COMELEC
to Enforce Perpetual Special Disqualification
Even without a petition under Section 78 of the Omnibus Election Code, the
COMELEC is under a legal duty to cancel the certificate of candidacy of anyone
suffering from perpetual special disqualification to run for public office by virtue of a
final judgment of conviction. The final judgment of conviction is judicial notice to
the COMELEC of the disqualification of the convict from running for public office.
The law itself bars the convict from running for public office, and the
disqualification is part of the final judgment of conviction. The final judgment of the
court is addressed not only to the Executive branch, but also to other government
agencies tasked to implement the final judgment under the law.
Whether or not the COMELEC is expressly mentioned in the judgment to
implement the disqualification, it is assumed that the portion of the final judgment
on disqualification to run for elective public office is addressed to the COMELEC
because under the Constitution the COMELEC is duty bound to "enforce and
administer all laws and regulations relative to the conduct of an election."46 The
disqualification of a convict to run for elective public office under the Revised Penal
Code, as affirmed by final judgment of a competent court, is part of
the enforcement and administration of "all the laws" relating to the conduct of
elections.
Effect of a Void Certificate of Candidacy
A cancelled certificate of candidacy void ab initio cannot give rise to a valid
candidacy, and much less to valid votes.47 We quote from the COMELEC’s 2
February 2011 Resolution with approval:
As early as February 18, 2010, the Commission speaking through the Second
Division had already ordered the cancellation of Lonzanida’s certificate of
candidacy, and had stricken off his name in the list of official candidates for the
mayoralty post of San Antonio, Zambales. Thereafter, the Commission En Banc in
its resolution dated August 11, 2010 unanimously affirmed the resolution
disqualifying Lonzanida. Our findings were likewise sustained by the Supreme
Court no less. The disqualification of Lonzanida is not simply anchored on one
ground. On the contrary, it was emphasized in our En Banc resolution that
Lonzanida’s disqualification is two-pronged: first, he violated the constitutional fiat
on the three-term limit; and second, as early as December 1, 2009, he is known to
have been convicted by final judgment for ten (10) counts of Falsification under
Article 171 of the Revised Penal Code. In other words, on election day, respondent
Lonzanida’s disqualification is notoriously known in fact and in law. Ergo, since
respondent Lonzanida was never a candidate for the position of Mayor [of] San
Antonio, Zambales, the votes cast for him should be considered stray votes.
Consequently, Intervenor Antipolo, who remains as the sole qualified candidate for
the mayoralty post and obtained the highest number of votes, should now be
proclaimed as the duly elected Mayor of San Antonio, Zambales.48 (Boldfacing and
underscoring in the original; italicization supplied)
Lonzanida's certificate of candidacy was cancelled because he was ineligible or
not qualified to run for Mayor.1âwphi1Whether his certificate of candidacy is
cancelled before or after the elections is immaterial because the cancellation on
such ground means he was never a candidate from the very beginning, his
certificate of candidacy being void ab initio. There was only one qualified candidate
for Mayor in the May 201 0 elections - Anti polo, who therefore received the
highest number of votes.
WHEREFORE, the petition is DISMISSED. The Resolution dated 2 February 2011
and the Order dated 12 January 2011 of the COMELEC En Bane in SPA No. 09-
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158 (DC) are AFFIRMED. The COMELEC En Bane is DIRECTED to constitute a
Special Municipal Board of Canvassers to proclaim Estela D. Antipolo as the duly
elected Mayor of San Antonio, Zambales. Petitioner Efren Racel Aratea
is ORDERED to cease and desist from discharging the functions of the Office of
the Mayor of San Antonio, Zambales.
SO ORDERED.
G.R. No. 194994 April 16, 2013
EMMANUEL A. DE CASTRO, Petitioner,
vs.
EMERSON S. CARLOS, Respondent.
DECISION
SERENO, CJ.:
Before us is a Petition for the issuance of a writ of quo warranto under Rule 66
filed by Emmanuel A. de Castro (petitioner) seeking to oust respondent Emerson
S. Carlos (respondent) from the position of assistant general manager for
operations (AGMO) of the Metropolitan Manila Development Authority (MMDA).
On 29 July 2009, then President Gloria Macapagal Arroyo appointed petitioner as
AGM0.1 His appointment was concurred in by the members of the Metro Manila
Council in MMDA Resolution No. 09-10, Series of 2009.2 He took his oath on 17
August 2009 before then Chairperson Bayani F. Fernando.3
Meanwhile, on 29 July 2010, Executive Secretary Paquito Ochoa issued Office of
the President (OP) Memorandum Circular No. 2, Series of 2010, amending OP
Memorandum Circular No. 1, Series of 2010.
OP Memorandum Circular No. 2 states:
2. All non-Career Executive Service Officials (non-CESO) occupying Career
Executive Service (CES) positions in all agencies of the executive branch shall
remain in office and continue to perform their duties and discharge their
responsibility until October 31, 2010 or until their resignations have been accepted
and/or until their respective replacements have been appointed or designated,
whichever comes first, unless they are reappointed in the meantime.4
On 30 July 2010, Atty. Francis N. Tolentino, chairperson of the MMDA, issued
Office Order No. 106,5 designating Corazon B. Cruz as officer-in-charge (OIC) of
the Office of the AGMO. Petitioner was then reassigned to the Legal and
Legislative Affairs Office, Office of the General Manager. The service vehicle and
the office space previously assigned to him were withdrawn and assigned to other
employees.
Subsequently, on 2 November 2010, Chairperson Tolentino designated
respondent as OIC of the Office of the AGMO by virtue of Memorandum Order No.
24,6 which in turn cited OP Memorandum Circular No. 2 as basis. Thereafter, the
name of petitioner was stricken off the MMDA payroll, and he was no longer paid
his salary beginning November 2010.
Petitioner sought a clarification7 from the Career Executive Service Board (CESB)
as to the proper classification of the position of AGMO. In her reply, 8 Executive
Director Maria Anthonette Allones (Executive Director Allones), CESO I, stated
that the position of AGMO had not yet been classified and could not be considered
as belonging to the Career Executive Service (CES). She further stated that a
perusal of the appointment papers of petitioner showed that he was not holding a
coterminous position. In sum, she said, he was not covered by OP Memorandum
Circular Nos. 1 and 2.
Petitioner was later offered the position of Director IV of MMDA Public Health and
Safety Services and/or MMDA consultant. He turned down the offer, claiming that
it was a demotion in rank.
Demanding payment of his salary and reinstatement in the monthly
payroll,9 petitioner sent a letter on 5 December 2010 to Edenison Faisan, assistant
general manager (AGM) for Finance and Administration; and Lydia Domingo,
Director III, Administrative Services. For his failure to obtain an action or a
response from MMDA, he then made a formal demand for his reinstatement as
AGMO through a letter addressed to the Office of the President on 17 December
2010.10
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However, on 4 January 2011, President Benigno S. Aquino III (President Aquino)
appointed respondent as the new AGMO of the MMDA.11 On 10 January 2011, the
latter took his oath of office.
Hence, the instant Petition.
The Office of the Solicitor General (OSG), representing respondent, filed its
Comment on 19 August 2011.12However, upon motion of petitioner, it was
disqualified from representing respondent. Thus, a private law firm 13entered an
appearance as counsel for respondent and adopted the Comment filed by the
OSG.14
Petitioner filed his Reply on 17 November 2011.
ISSUES
Petitioner raises the following issues15 for the consideration of this Court:
(1) Whether respondent Emerson S. Carlos was validly appointed by President
Aquino to the position of AGMO of the MMDA;
(2) Whether petitioner Emmanuel A. de Castro is entitled to the position of AGMO;
and
(3) Whether or not respondent should pay petitioner the salaries and financial
benefits he received during his illegal tenure as AGMO of the MMDA.
THE COURT’S RULING
Petitioner contends that Section 2(3), Article IX(B) of the 1987 Constitution
guarantees the security of tenure of employees in the civil service. He further
argues that his appointment as AGMO is not covered by OP Memorandum
Circular No. 2, since it is not a CES position as determined by the CESB.
On the other hand, respondent posits that the AGMO position belongs to the CES;
thus, in order to have security of tenure, petitioner, must be a Career Executive
Service official (CESO). Respondent maintains that the function of an AGM is
executive and managerial in nature. Thus, considering that petitioner is a non-
CESO occupying a CES position, he is covered by OP Memorandum Circular Nos.
1 and 2. Respondent likewise raises the issue of procedural infirmity in the direct
recourse to the Supreme Court by petitioner, who thereby failed to adhere to the
doctrine of hierarchy of courts.
Hierarchy of Courts
As to the procedural issue, petitioner submits that a direct recourse to this Court is
warranted by the urgent demands of public interest, particularly the veritable need
for stability in the civil service and the protection of the rights of civil servants.
Moreover, considering that no other than the President of the Philippines is the
appointing authority, petitioner doubts if a trial court judge or an appellate court
justice, with a prospect of promotion in the judiciary would be willing to go against
a presidential appointment.
Although Section 5(1) of Article VIII of the 1987 Constitution explicitly provides that
the Supreme Court has original jurisdiction over petitions for certiorari, prohibition,
mandamus, quo warranto, and habeas corpus, the jurisdiction of this Court is not
exclusive but is concurrent with that of the Court of Appeals and regional trial court
and does not give petitioner unrestricted freedom of choice of court forum. 16 The
hierarchy of courts must be strictly observed.
Settled is the rule that "the Supreme Court is a court of last resort and must so
remain if it is to satisfactorily perform the functions assigned to it by the
fundamental charter and immemorial tradition."17 A disregard of the doctrine of
hierarchy of courts warrants, as a rule, the outright dismissal of a petition. 18
A direct invocation of this Court’s jurisdiction is allowed only when there are special
and important reasons that are clearly and specifically set forth in a petition. 19 The
rationale behind this policy arises from the necessity of preventing (1) inordinate
demands upon the time and attention of the Court, which is better devoted to those
matters within its exclusive jurisdiction; and (2) further overcrowding of the Court’s
docket.20
In this case, petitioner justified his act of directly filing with this Court only when he
filed his Reply and after respondent had already raised the procedural infirmity that
may cause the outright dismissal of the present Petition. Petitioner likewise cites
stability in the civil service and protection of the rights of civil servants as rationale
for disregarding the hierarchy of courts.
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Petitioner’s excuses are not special and important circumstances that would allow
a direct recourse to this Court. More so, mere speculation and doubt to the
exercise of judicial discretion of the lower courts are not and cannot be valid
justifications to hurdle the hierarchy of courts. Thus, the Petition must be
dismissed.
Nature of the AGMO Position
Even assuming that petitioner’s direct resort to this Court is permissible, the
Petition must still be dismissed for lack of merit.
"A petition for quo warranto is a proceeding to determine the right of a person to
use or exercise a franchise or an office and to oust the holder from the enjoyment,
thereof, if the claim is not well-founded, or if his right to enjoy the privilege has
been forfeited."21 Where the action is filed by a private person, in his own name, he
must prove that he is entitled to the controverted position, otherwise, respondent
has a right to the undisturbed possession of the office.22
The controversy arose from the issuance of OP Memorandum Circular Nos. 1 and
2, which applies to all non-CESO’s occupying CES positions in all agencies of the
executive branch. Petitioner, being a non-CESO, avers that he is not covered by
these OP memoranda considering that the AGMO of the MMDA is a non-CES
position.
In order to settle the controversy, there is a need to determine the nature of the
contentious position of AGMO of the MMDA.
Career vs. non-career
Section 4 of Republic Act No. (R.A.) 7924,23 otherwise known as the MMDA
Charter, specifically created the position of AGMO. It reads as follows:
Sec. 4 Metro Manila Council. x x x.
xxxx
The Council shall be headed by a Chairman, who shall be appointed by the
President and who shall continue to hold office at the discretion of the appointing
authority. He shall be vested with the rank, rights, privileges, disqualifications, and
prohibitions of a Cabinet member.
The Chairman shall be assisted by a General Manager, an Assistant General
Manager for Finance and Administration, an Assistant General Manager for
Planning and an Assistant General Manager for Operations, all of whom shall be
appointed by the President with the consent and concurrence of the majority of the
Council, subject to civil service laws and regulations. They shall enjoy security of
tenure and may be removed for cause in accordance with law. (Emphasis
supplied)
Executive Order No. (E.O.) 292, otherwise known as The Revised Administrative
Code of 1987, provides for two classifications of positions in the civil service:
career and non-career.24
Career service is characterized by the existence of security of tenure, 25 as
contradistinguished from non-career service whose tenure is coterminous with that
of the appointing authority; or subject to the latter’s pleasure; or limited to a period
specified by law or to the duration of a particular project for which purpose the
appointment was made.26
Applying the foregoing distinction to the instant case, this Court finds that an
AGMO holds a career position, considering that the MMDA Charter specifically
provides that AGMs enjoy security of tenure – the core characteristic of a career
service, as distinguished from a non-career service position.
CES vs. non-CES
Career service includes the following:
(1) Open Career positions for appointment to which prior qualification in an
appropriate examination is required;
(2) Closed Career positions which are scientific, or highly technical in nature; these
include the faculty and academic staff of state colleges and universities, and
scientific and technical positions in scientific or research institutions which shall
establish and maintain their own merit systems;
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(3) Positions in the Career Executive Service; namely, Undersecretary, Assistant
Secretary, Bureau Director, Assistant Bureau Director, Regional Director, Assistant
Regional Director, Chief of Department Service and other officers of equivalent
rank as may be identified by the Career Executive Service Board, all of whom are
appointed by the President;
(4) Career officers, other than those in the Career Executive Service, who are
appointed by the President, such as the Foreign Service Officers in the
Department of Foreign Affairs;
(5) Commissioned officers and enlisted men of the Armed Forces which shall
maintain a separate merit system;
(6) Personnel of government-owned or controlled corporations, whether performing
governmental or proprietary functions, who do not fall under the non-career
service; and
(7) Permanent laborers, whether skilled, semi-skilled, or unskilled.27 (Emphasis
supplied)
In Civil Service Commission v. Court of Appeals and PCSO,28 the Court clarified
the positions covered by the CES:
Thus, from the long line of cases cited above, in order for a position to be covered
by the CES, two elements must concur. First, the position must either be (1) a
position enumerated under Book V, Title I, Subsection A, Chapter 2, Section 7(3)
of the Administrative Code of 1987, i.e., Undersecretary, Assistant Secretary,
Bureau Director, Assistant Bureau Director, Regional Director, Assistant Regional
Director, Chief of Department Service, or (2) a position of equal rank as those
enumerated, and identified by the Career Executive Service Board to be such
position of equal rank. Second, the holder of the position must be a presidential
appointee. Failing in any of these requirements, a position cannot be considered
as one covered by the third-level or CES. (Emphasis supplied)
In sum, there are two elements required for a position to be considered as CES:
1) The position is among those enumerated under Book V, Title I, Subtitle A,
Chapter 2, Section 7(3) of the Administrative Code of 1987 OR a position of equal
rank as those enumerated and identified by the CESB to be such position of equal
rank; AND
2) The holder of the position is a presidential appointee. Records show that in
reply29 to Chairperson Tolentino’s query on whether the positions of general
manager and AGM of the MMDA are covered by the CES,30 the CESB – thru
Executive Director Allones – categorically stated that these positions are not
among those covered by the CES.
Upon petitioner’s separate inquiry on the matter,31 the CESB similarly responded
that the AGMO’s position could not be considered as belonging to the
CES.32 Additionally, Executive Director Allones said that petitioner was not covered
by OP Memorandum Circular Nos. 1 and 2, to wit:
A cursory perusal of your appointment papers would show that it does not bear
any indication that you are holding a coterminous appointment. Neither your
position as AGMO can be considered as created in excess of the authorized
staffing pattern since RA 7924, the law that created the MMDA clearly provided for
such position. As further stated above, your position will not fall under paragraph
No. 2 of OP MC 1 because it is not yet considered as belonging to the CES.
Hence, we posit that you are not covered by OP MC 1 and 2.33
However, contrary to Executive Director Allones’ statement, the CESB, through
Resolution No. 799 already declared certain positions meeting the criteria set
therein as embraced within the CES.
It is worthy of note that CESB Resolution No. 799 was issued on 19 May 2009,
even prior to petitioner’s appointment on 29 July 2009. Moreover, as early as 31
May 1994, the above classification was already embodied in CSC Resolution No.
34-2925, circularized in CSC Memorandum Circular 21, Series of 1994.
Resolution No. 799 classified the following positions as falling within the coverage
of the CES:
a. The Career Executive Service includes the positions of Undersecretary,
Assistant Secretary, Bureau director, Assistant Bureau Director, regional Director
(department-wide and bureau-wide), Assistant Regional Director (department-wide
and bureau-wide), and Chief of Department Service;
b. Unless provided otherwise, all other managerial or executive positions in the
government, including government-owned or controlled corporations with original
charters are embraced within the CES provided that they meet the following
criteria:
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i.) The position is a career position;
ii.) The position is above division chief level; and,
iii.) The duties and responsibilities of the position require performance of executive
and managerial functions.
Without a doubt, the AGMO position is not one of those enumerated in the above-
cited paragraph(a) but it clearly falls under paragraph(b) considering that it belongs
to a government-owned and controlled corporation with an original charter. The
nature of AGMO is clear from the provisions of the MMDA Charter.
First, we have already determined that an AGMO is a career position that enjoys
security of tenure by virtue of the MMDA Charter.
Second, it is undisputed that the position of AGMO is above the division chief level,
which is equivalent to the rank of assistant secretary with Salary Grade 29. 34
Third, a perusal of the MMDA Charter readily reveals that the duties and
responsibilities of the position require the performance of executive and
managerial functions.
Section 12.4, Rule IV of the Rules and Regulations Implementing R.A. 7924
provides the powers, functions, duties and responsibilities of an AGMO, as follows:
12.4 Assistant General Manager for Operations
The Assistant General Manager for Operations shall perform the following
functions:
a. Establish a mechanism for coordinating and operationalizing the delivery of
metro-wide basic services;
b. Maintain a monitoring system for the effective evaluation of the implementation
of approved policies, plans and programs for the development of Metropolitan
Manila;
c. Mobilize the participation of local government units, executive departments or
agencies of the national government, and the private sector in the delivery of
metro-wide services; and
d. Operate a central radio communication system.
He shall perform such other duties as are incidental or related to the above
functions or as may be assigned from time to time.
An AGMO performs functions that are managerial in character; exercises
management over people, resource, and/or policy; and assumes functions like
planning, organizing, directing, coordinating, controlling, and overseeing the
activities of MMDA. The position requires the application of managerial or
supervisory skills necessary to carry out duties and responsibilities involving
functional guidance, leadership, and supervision.
For the foregoing reasons, the position of AGMO is within the coverage of the
CES.
In relation thereto, positions in the career service, for which appointments require
examinations, are grouped into three major levels:35
Sec. 8. Classes of positions in the Career Service. — (1) Classes of positions in
the career service appointment to which requires examinations shall be grouped
into three major levels as follows:
(a) The first level shall include clerical, trades, crafts and custodial service
positions which involve non-professional or sub-professional work in a non-
supervisory or supervisory capacity requiring less than four years of collegiate
studies;
(b) The second level shall include professional, technical, and scientific positions
which involve professional, technical or scientific work in a non-supervisory or
supervisory capacity requiring at least four years of college work up to Division
Chief levels; and
(c) The third level shall cover positions in the Career Executive Service. (Emphasis
supplied)
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Entrance to different levels requires corresponding civil service eligibilities. 36 Those
at the third level (CES positions) require career service executive eligibility (CSEE)
as a requirement for permanent appointment.37
Evidently, an AGMO should possess all the qualifications required by third-level
career service within the CES. In this case, petitioner does not have the required
eligibility. Therefore, we find that his appointment to the position of AGMO was
merely temporary.
Amores v. Civil Service Commission38 is instructive as to the nature of temporary
appointments in the CES. The Court held therein that an appointee cannot hold a
position in a permanent capacity without the required CES eligibility:
We begin with the precept, firmly established by law and jurisprudence that a
permanent appointment in the civil service is issued to a person who has met the
requirements of the position to which the appointment is made in accordance with
law and the rules issued pursuant thereto. An appointment is permanent where the
appointee meets all the requirements for the position to which he is being
appointed, including the appropriate eligibility prescribed, and it is temporary where
the appointee meets all the requirements for the position except only the
appropriate civil service eligibility.
xxxx
With particular reference to positions in the career executive service (CES), the
requisite civil service eligibility is acquired upon passing the CES examinations
administered by the CES Board and the subsequent conferment of such eligibility
upon passing the examinations. Once a person acquires eligibility, he either earns
the status of a permanent appointee to the CES position to which he has
previously been appointed, or he becomes qualified for a permanent appointment
to that position provided only that he also possesses all the other qualifications for
the position. Verily, it is clear that the possession of the required CES eligibility is
that which will make an appointment in the career executive service a permanent
one. Petitioner does not possess such eligibility, however, it cannot be said that his
appointment to the position was permanent.
Indeed, the law permits, on many occasions, the appointment of non-CES eligibles
to CES positions in the government in the absence of appropriate eligibles and
when there is necessity in the interest of public service to fill vacancies in the
government. But in all such cases, the appointment is at best merely temporary as
it is said to be conditioned on the subsequent obtention of the required CES
eligibility. This rule, according to De Leon v. Court of Appeals, Dimayuga v.
Benedicto, Caringal v. Philippine Charity Sweepstakes Office, and Achacoso v.
Macaraig, is invariable even though the given appointment may have been
designated as permanent by the appointing authority.
xxxx
Security of tenure in the career executive service, which presupposes a permanent
appointment, takes place upon passing the CES examinations administered by the
CES Board x x x.
Petitioner undisputedly lacked CES eligibility. Thus, he did not hold the position of
AGMO in a permanent capacity or acquire security of tenure in that position.
Otherwise stated, his appointment was temporary and "co-terminus with the
appointing authority."39 In Carillo v. CA,40 this Court ruled that "one who holds a
temporary appointment has no fixed tenure of office; his employment can be
terminated at the pleasure of the appointing power, there being no need to show
that the termination is for cause." Therefore, we find no violation of security of
tenure when petitioner was replaced by respondent upon the latter’s appointment
to the position of AGMO by President Aquino.
Even granting for the sake of argument that the position of AGMO is yet to be
classified by the CESB, petitioner’s appointment is still deemed coterminous
pursuant to CESB Resolution No. 945 issued on 14 June 2011, which reads:
WHEREAS, on November 23, 2010, the Supreme Court in the case of PCSO v.
CSC, G.R. NO. 185766 and G.R. No. 185767 limited the coverage of positions
belonging to the CES to positions requiring Presidential appointments.
WHEREAS, in the same vein, CES positions have now become synonymous to
third level positions by virtue of the said ruling.
WHEREFORE, foregoing premises considered, the Board RESOLVES, as it is
hereby RESOLVED, to issue the following guidelines to clarify the policy on the
coverage of CES and its classification:
1. For career service positions requiring Presidential appointments expressly
enumerated under Section 7(3), Chapter 2, Subtitle A, Title 1, Book V of the
Administrative Code of 1987 namely:
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Undersecretary, Assistant Secretary, Bureau Director, Assistant Bureau Director,
Regional Director, Assistant Regional Director, and Chief of Department Service,
no classification of position is necessary to place them under the coverage of the
CES, except if they belong to Project Offices, in which case a position
classification is required, in consultation with the Department of Budget and
Management (DBM).
2. For positions requiring Presidential appointments other than those enumerated
above, a classification of positions is necessary which shall be conducted by the
Board, upon request of the head of office of the government department/agency
concerned, to place them under the coverage of the CES provided they comply
with the following criteria:
i.) The position is a career position;
ii.) The position is above division chief level; and,
iii.)The duties and responsibilities of the position require the performance of
executive and managerial functions.
All appointments to positions which have not been previously classified as part of
the CES would be deemed co-terminus with the appointing authority. (Emphasis
supplied)
Therefore, considering that petitioner is an appointee of then President Arroyo
whose term ended on 30 June 2010, petitioner’s term of office was also deemed
terminated upon the assumption of President Aquino.
Likewise, it is inconsequential that petitioner was allegedly replaced by another
non-CESO eligible. In a quo warranto proceeding, the person suing must show
that he has a clear right to the office allegedly held unlawfully by another. Absent a
showing of that right, the lack of qualification or eligibility of the supposed usurper
is immaterial.41
All the foregoing considered, the petition merits an outright dismissal for
disregarding the hierarchy of courts and petitioner’s lack of cause of action against
respondent for failure to sufficiently show that he has undisturbed rights to the
position of AGMO of the MMDA.
WHEREFORE, premises considered, the Petition is DENIED.
SO ORDERED.
January 12, 2016
G.R. No. 211140
LORD ALLAN JAY Q. VELASCO, Petitioner,
vs.
HON. SPEAKER FELICIANO R. BELMONTE, JR., SECRETARY GENERAL
MARILYN1 B. BARUA-YAP AND REGINA ONGSIAKO REYES, Respondents.
DECISION
LEONARDO-DE CASTRO, J.:
In the same manner that this Court is cautioned to be circumspect because one
party is the son of a sitting Justice of this Court, so too must we avoid abjuring
what ought to be done as dictated by law and justice solely for that reason.
Before this Court is a Petition for Mandamus filed under Rule 65 of the Rules of
Court, as amended, by Lord Allan Jay Q. Velasco (Velasco) against Hon. Feliciano
R. Belmonte, Jr. (Speaker Belmonte, Jr.), Speaker, House of Representatives,
Hon. Marilyn B. Barua-Yap (Sec. Gen. Barua-Yap ), Secretary General, House of
Representatives, and Hon. Regina Ongsiako Reyes
(Reyes), Representative, Lone District of the Province of Marinduque .
Velasco principally alleges that he is the "legal and rightful winner during the May
13, 2013 elections in accordance with final and executory resolutions of the
Commission on Elections (COMELEC) and [this] Honorable Court;"2 thus, he
seeks the following reliefs:
a. that a WRIT OF MANDAMUS against the HON. SPEAKER FELICIANO
BELMONTE, JR. be issued ordering said respondent to administer the
proper OATH in favor of petitioner Lord Allan Jay Q. Velasco for the
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 position of Representative for the Lone District of Marinduque; -and allow
petitioner to assume the position of representative for Marinduque and
exercise the powers and prerogatives of said position of Marinduque
representative;
b. that a WRIT OF MANDAMUS against SECRETARY-GENERAL
[MARILYN] BARUA-YAP be issued ordering said respondent to REMOVE
the name of Regina 0. Reyes in the Roll of Members of the House of
Representatives and to REGISTER the name of petitioner Lord Allan Jay
Q. Velasco, herein petitioner, in her stead; and
c. that a TEMPORARY RESTRAINING ORDER be issued to RESTRAIN,
PREVENT and PROHIBIT respondent REGINA ONGSIAKO REYES from
usurping the position of Member of the House of Representatives for the
Lone District of Marinduque and from further exercising the prerogatives of
said position and performing the duties pertaining thereto, and
DIRECTING her to IMMEDIATELY VACATE said position.3
The pertinent facts leading to the filing of the present petition are:
On October 10, 2012, one Joseph Socorro Tan (Tan), a registered voter and
resident of the Municipality of Torrijos, Marinduque, filed with the Commission on
Elections (COMELEC) a petition4 to deny due course or cancel the Certificate of
Candidacy (COC) of Reyes as candidate for the position of Representative of the
Lone District of the Province of Marinduque. In his petition, Tan alleged that
Reyes made several material misrepresentations in her COC, i.e., "(i) that she
is a resident of Brgy. Lupac, Boac, Marinduque; (ii) that she is a natural-born
Filipino citizen; (iii) that she is not a permanent resident of, or an immigrant to, a
foreign country; (iv) that her date of birth is July 3, 1964; (v) that her civil status is
single; and finally (vi) that she is eligible for the office she seeks to be elected
to."5 The case was docketed as SPA No. 13-053 (DC), entitled "Joseph Socorro B.
Tan v. Atty. Regina Ongsiako Reyes."
On March 27, 2013, the COMELEC First Division resolved to grant the petition;
hence, Reyes's COC was accordingly cancelled. The dispositive part of said
resolution reads:
WHEREFORE, in view of the foregoing, the instant Petition is GRANTED.
Accordingly, the Certificate of Candidacy of respondent REGINA ONGSIAKO
REYES is hereby CANCELLED.6
Aggrieved, Reyes filed a motion for reconsideration thereto.
But while said motion was pending resolution, the synchronized local and national
elections were held on May 13, 2013.
The day after, or on May 14, 2013, the COMELEC En Banc affirmed the resolution
of the COMELEC First Division, to wit:
WHEREFORE, premises considered, the Motion for Reconsideration is
hereby DENIED for lack of merit. The March 27, 2013 Resolution of the
Commission (First Division) is hereby AFFIRMED.7
A copy of the foregoing resolution was received by the Provincial Election
Supervisor of Marinduque, through Executive Assistant Rossini M. Oscadin, on
May 15, 2013.
Likewise, Reyes's counsel, Atty. Nelia S. Aureus, received a copy of the same on
May 16, 2013.
On May 18, 2013, despite its receipt of the May 14, 2013 COMELEC Resolution,
the Marinduque Provincial Board of Canvassers (PBOC) proclaimed Reyes as the
winner of the May 13, 2013 elections for the position of Representative of the Lone
District of Marinduque.
On May 31, 2013, Velasco filed an Election Protest Ad Cautelam against Reyes in
the House of Representatives Electoral Tribunal (HRET) docketed as HRET Case
No. 13-028, entitled "Lord Allan Jay Q. Velasco v. Regina Ongsiako Reyes."
Also on the same date, a Petition for Quo Warranto Ad Cautelam was also filed
against Reyes in the HRET docketed as HRET Case No. 13-027,
entitled "Christopher P Matienzo v. Regina Ongsiako Reyes."
On June 5, 2013, the COMELEC En Banc issued a Certificate of Finality8 in SPA
No. 13-053 (DC), which provides:
NOW, THEREFORE, considering that more than twenty-one (21) days have
lapsed since the date of the promulgation with no Order issued by the Supreme
Court restraining its execution, the Resolution of the Commission en
banc promulgated on May 14, 2013 is hereby declared FINAL and EXECUTORY.9
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On June 7, 2013, Speaker Belmonte, Jr. administered the oath of office to Reyes.
On June 10, 2013, Reyes filed before this Court a Petition for Certiorari docketed
as GR. No. 207264, entitled "Regina Ongsiako Reyes v. Commission on Elections
and Joseph Socorro Tan," assailing (i) the May 14, 2013 Resolution of the
COMELEC En Banc, which denied her motion for reconsideration of the March 27,
2013 Resolution of the COMELEC First Division cancelling her . Certificate of
Candidacy (for material misrepresentations made therein); and (ii) the June 5,
2013 Certificate of Finality.
In the meantime, it appears that Velasco filed a Petition for Certiorari before the
COMELEC docketed as SPC No. 13-010, entitled "Rep. Lord Allan Jay Q. Velasco
vs. New Members/Old Members of the Provincial Board of Canvassers (PBOC) of
the Lone District of Marinduque and Regina Ongsiako Reyes," assailing the
proceedings of the PBOC and the proclamation of Reyes as null and void.
On June 19, 2013, however, the COMELEC denied the aforementioned petition in
SPC No. 13-010.
On June 25, 2013, in G.R. No. 207264, this Court promulgated a Resolution
dismissing Reyes's petition, viz.:
IN VIEW OF THE· FOREGOING, the instant petition is DISMISSED, finding no
grave abuse of discretion on the part of the Commission on Elections. The 14 May
2013 Resolution of the COMELEC En Banc affirming the 27 March 2013
Resolution of the COMELEC First Division is upheld.10
Significantly, this Court held that Reyes cannot assert that it is the HRET which
has jurisdiction over her since she is not yet considered a Member of the House of
Representatives. This Court explained that to be considered a Member of the
House of Representatives, there must be a concurrence of the following
requisites: (i) a valid proclamation, (ii) a proper oath, and (iii) assumption of
office.11
On June 28, 2013, Tan filed a Motion for Execution (of the March 27, 2013
Resolution of the COMELEC First Division and the May 14, 2013 Resolution of the
COMELEC En Banc) in SPA No. 13-053 (DC), wherein he prayed that:
[A]n Order be issued granting the instant motion; and cause the immediate
EXECUTION of this Honorable Commission's Resolutions dated March 27, 2013
and May 14, 2013; CAUSE the PROCLAMATION of LORD ALLAN JAY Q.
VELASCO as the duly elected Member of the House of Representatives for the
Lone District of Marinduque, during the May 2013 National and Local Elections. 12
At noon of June 30, 2013, it would appear that Reyes assumed office and started
discharging the functions of a Member of the House of Representatives.
On July 9, 2013, in SPC No. 13-010, acting on the motion for reconsideration of
Velasco, the COMELEC En Banc reversed the June 19, 2013 denial of Velasco's
petition and declared null and void and without legal effect the proclamation of
Reyes. The dispositive part reads:
WHEREFORE, in view of the foregoing, the instant motion for reconsideration is
hereby GRANTED. The assailed June 19, 2013 Resolution of the First Division is
REVERSED and SET ASIDE.
Corollary thereto, the May 18, 2013 proclamation of respondent REGINA
ONGSIAKO REYES is declared NULL and VOID and without any legal force and
effect. Petitioner LORD ALLAN JAY Q. VELASCO is hereby proclaimed the
winning candidate for the position of representative in the House of
Representatives for the province of Marinduque.13 (Emphasis supplied.)
Significantly, the aforequoted Resolution has not been challenged in this Court.
On July 10, 2013, in SPA No. 13-053 (DC), the COMELEC En Banc, issued an
Order (i) granting Tan's motion for execution (of the May 14, 2013 Resolution);
and (ii) directing the reconstitution of a new PBOC of Marinduque, as well as the
proclamation by said new Board of Velasco as the duly elected Representative of
the Lone District of Marinduque. The fallo of which states:
IN VIEW OF THE FOREGOING, the Commission hereby GRANTS the instant
Motion. Accordingly, a new composition of the Provincial Board of Canvassers of
Marinduque is hereby constituted to be composed of the following:
1. Atty. Ma. Josefina E. Dela Cruz - Chairman
2. Atty. Abigail Justine Cuaresma-Lilagan - Vice Chairman
3. Dir. Ester Villaflor-Roxas - Member
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 4. Three (3) Support Staffs
For this purpose, the Commission hereby directs, after due notice to the parties,
the convening of the New Provincial Board of Canvassers of Marinduque on July
16, 2013 (Tuesday) at 2:00 p.m., at the COMELEC Session Hall. gth Floor. PDG
Intramuros, Manila and to PROCLAIM LORD ALLAN JAY Q. VELASCO as the
duly elected Member of the House of Representatives for the Lone District of
Marinduque in the May 13, 2013 National and Local Elections.
Further, Director Ester Villaflor-Roxas is directed to submit before the New
Provincial Board of Canvassers (NPBOC) a certified true copy of the votes of
congressional candidate Lord Allan Jay Q. Velasco in the 2013 National and Local
Elections.
Finally, the NPBOC of the Province of Marinduque is likewise directed to furnish
copy of the Certificate of Proclamation to the Department of Interior and Local
Government (DILG) and the House of Representatives.14
On July 16, 2013, the newly constituted PBOC of Marinduque proclaimed herein
petitioner Velasco as the duly elected Member of the House of Representatives for
the Lone District of Marinduque with 48,396 votes obtained from 245 clustered
precincts.15
On July 22, 2013, the 16th Congress of the Republic of the Philippines formally
convened in a joint session. On the same day, Reyes, as the recognized elected
Representative for the Lone District of Marinduque, along with the rest of the
Members of the House of Representatives, took their oaths in open session before
Speaker Belmonte, Jr.
On July 23, 2013, Reyes filed a Manifestation and Notice of Withdrawal of
Petition "without waiver of her arguments, positions, defenses/causes of action as
will be articulated in the HRET which is now the proper forum."16
On October 22, 2013, Reyes's motion for reconsideration17 (of this Court's June
25, 2013 Resolution in GR. No. 207264) filed on July 15, 2013, was denied by this
Court, viz.:
WHEREFORE, The Motion for Reconsideration is DENIED. The dismissal of the
petition is affirmed. Entry of Judgment is ordered.18
On November 27, 2013, Reyes filed a Motion for Leave of Court to File and Admit
Motion for Reconsideration in G.R. No. 207264.
On December 3, 2013, said motion was treated as a second motion for
reconsideration and was denied by this Court.
On December 5, 2013 and January 20, 2014, respectively, Velasco sent two
letters to Reyes essentially demanding that she vacate the office of Representative
of the Lone District of Marinduque and to relinquish the same in his favor.
On December 10, 2013, Velasco wrote a letter to Speaker Belmonte, Jr.
requesting, among others, that he be allowed to assume the position of
Representative of the Lone District of Marinduque.
On December 11, 2013, in SPC No. 13-010, acting .on the Motion for Issuance of
a Writ of Execution filed by Velasco on November 29, 2013, praying that:
WHEREFORE, it is respectfully prayed that a writ of execution be ISSUED to
implement and enforce the May 14, 2013 Resolution in SPA No. 13-053, the July
9, 2013 Resolution in SPC No. 13-010 and the July 16, 2013 Certificate of
Proclamation of Petitioner Lord Allan Jay Q. Velasco as Representative of
Marinduque. It is further prayed that a certified true copy of the writ of execution be
personally served and delivered by the Commission's bailiff to Speaker Feliciano
Belmonte for the latter's implementation and enforcement of the aforementioned
May 14, 2013 Resolution and July 9, 2013 Resolution and the July 16, 2013
Certificate of Proclamation issued by the Special Board of Canvassers of the
Honorable Commission.19
the COMELEC issued an Order20 dated December 11, 2013 directing, inter
alia, that all copies of its Resolutions in SPA No. 13-053 (DC) and SPC No. 13-
010, the Certificate of Finality dated June 5, 2013, the Order dated July 10, 2013,
and the Certificate of Proclamation dated July 16, 2013 be forwarded and
furnished to Speaker Belmonte, Jr. for the latter's information and guidance.
On February 4, 2014, Velasco wrote another letter to Speaker Belmonte, Jr.
reiterating the above-mentioned request but to no avail.
On February 6, 2014, Velasco also wrote a letter to Sec. Gen. Barua-Yap
reiterating his earlier requests (July 12 and 18, 2013) to delete the name of Reyes
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from the Roll of Members and register his name in her place as the duly elected
Representative of the Lone District of Marinduque.
However, Velasco relates that his efforts proved futile. He alleges that despite all
the letters and requests to Speaker Belmonte, Jr. and Sec. Gen. Barua-Yap, they
refused to recognize him as the duly elected Representative of the Lone District of
Marinduque. Likewise, in the face of numerous written demands for Reyes to
vacate the position and office of the Representative of the Lone District of
Marinduque, she continues to discharge the duties of said position.
Hence, the instant Petition for Mandamus with prayer for issuance of a temporary
restraining order and/or injunction anchored on the following issues:
A. Whether or not Speaker Belmonte, Jr. can be COMPELLED,
DIRECTED and ORDERED by a Writ of Mandamus to administer the oath
in favor of petitioner as duly elected Marinduque Representative and allow
him to assume said position and exercise the prerogatives of said office.
B. Whether or not respondent SG Barna-Yap can be COMPELLED,
DIRECTED and ORDERED by a Writ of Mandamus to delete the name of
respondent Reyes from the Roll of Members of the House and include the
name of the Petitioner in the Roll of Members of the House of
Representatives.
C. Whether or not a TEMPORARY RESTRAINING ORDER (TRO) and a
Writ of PERMANENT. INJUNCTION can be issued to prevent, restrain and
prohibit respondent Reyes from exercising the prerogatives and
performing the functions as Marinduque Representative, and to order her
to VACATE the said office.21
As to the first and second issues, Velasco contends that he "has a well-defined
and clear legal right and basis to warrant the grant of the writ of mandamus."22 He
insists that the final and executory decisions of the COMELEC in SPA No. 13-053
(DC), and this Court in G.R. No. 207264, as well as the nullification of respondent
Reyes's proclamation and his subsequent proclamation as the duly elected
Representative of the Lone District of Marinduque, collectively give him the legal
right to claim the congressional seat.
Thus, he contends that it is the ministerial duty of (i) respondent Speaker
Belmonte, Jr. "to administer the oath to [him] and to allow him to assume and
exercise the prerogatives of the congressional seat for Marinduque
representative;"23 and (ii) respondent Sec. Gen. Barua-Yap "to register [his] name
xx x as the duly elected member of the House and delete the name of respondent
Reyes from the Roll ofM embers." 24 Velasco anchors his position on Codilla, Sr. v.
De Venecia,25 citing a statement of this Court to the effect that the Speaker of the
House of Representatives has the ministerial duty to recognize the petitioner
therein (Codilla) as the duly elected Representative of the Fourth District of Leyte.
Despite the foregoing, Velasco asserts that both respondents Speaker Belmonte,
Jr. and Sec. Gen. Barua-Yap are unlawfully neglecting the performance of their
alleged ministerial duties; thus, illegally excluding him (Velasco) from the
enjoyment of his right as the duly elected Representative of the Lone District of
Marinduque.26
With respect to the third issue, Velasco posits that the "continued usurpation and
unlawful holding of such position by respondent Reyes has worked injustice and
serious prejudice to [him] in that she has already received the salaries, allowances,
bonuses and emoluments that pertain to the position of Marinduque
Representative since June 30, 2013 up to the present in the amount of around
several hundreds of thousands of pesos." Therefore, he prays for the issuance of a
temporary restraining order and a writ of permanent injunction against respondent
Reyes to "restrain, prevent and prohibit [her] from usurping the position."27
In her Comment, Reyes contends that the petition is actually one for quo
warranto and not mandamus given that it essentially seeks a declaration that she
usurped the subject office; and the installation of Velasco in her place by Speaker
Belmonte, Jr. when the latter administers his oath of office and enters his name in
the Roll of Members. She argues that, being a collateral attack on a title to public
office, the petition must be dismissed as enunciated by the Court in several
cases.28
As to the issues presented for resolution, Reyes questions the jurisdiction of the
Court over Quo Warranto cases involving Members of the House of
Representatives. She posits that "even if the Petition for Mandamus be treated as
one of Quo Warranto, it is still dismissible for lack of jurisdiction and absence of a
clear legal right on the part of [Velasco]. "29 She argues that numerous
jurisprudence have already ruled that it is the House of Representatives Electoral
Tribunal that has the sole and exclusive jurisdiction over all contests relating to the
election, returns and qualifications of Members of the House of Representatives.
Moreover, she insists that there is also an abundance of case law that
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categorically states that the COMELEC is divested of jurisdiction upon her
proclamation as the winning candidate, as, in fact, the HRET had already assumed
jurisdiction over quo warranto cases30 filed against Reyes by several individuals.
Given the foregoing, Reyes concludes that this Court is "devoid of original
jurisdiction to annul [her] proclamation. "31But she hastens to point out that (i)
"[e]ven granting for the sake of argument that the proclamation was validly
nullified, [Velasco] as second placer cannot be declared the winner x x x" as he
was not the choice of the people of the Province of Marinduque; and (ii) Velasco is
estopped from asserting the jurisdiction of this Court over her (Reyes) election
because he (Velasco) filed an Election Protest Ad Cautelam in the HRET on May
31, 2014.
The Office of the Solicitor General (OSG), arguing for Speaker Belmonte, Jr. and
Sec. Gen. Barua-Yap, opposed Velasco's petition on the following grounds:
I.
UPON RESPONDENT REYES' PROCLAMATION ON MAY 18, 2013,
EXCLUSIVE JURISDICTION TO RESOLVE ELECTION CONTESTS INVOLVING
RESPONDENT REYES, INCLUDING THE VALIDITY OF HER PROCLAMATION
AND HER ELIGIBILITY FOR OFFICE, VESTED IN THE HRET.
Hence, until and unless the HRET grants any quo warranto petition or election
protest filed against respondent Reyes, and such HRET resolution or resolutions
become final and executory, respondent Reyes may not be restrained from
exercising the prerogatives of Marinduque Representative, and respondent Sec.
Gen. Barua-Yap may not be compelled by mandamus to remove respondent
Reyes :S name from the Roll of Members of the House.
II.
CODILLA v. COMELEC IS NOT APPLICABLE TO THIS CASE, GIVEN THAT
PETITIONER, BEING MERELY THE SECOND PLACER IN THE MAY 13, 2013
ELECTIONS, CANNOT VALIDLY ASSUME THE POST OF MARINDUQUE
REPRESENTATIVE.
Hence, respondents Speaker Belmonte and Sec. Gen. Barua-Yap may not be
compelled by mandamus to, respectively, administer the proper oath to petitioner
and register the latter's name in the Roll of Members of the House.
III.
PETITIONER IS NOT ENTITLED TO THE INJUNCTIVE RELIEFS PRAYED
FOR.32
The OSG presents the foregoing arguments on the premise that there is a need for
this Court to revisit its twin Resolutions dated June 25, 2013 and October 22, 2013
both in GR. No. 207264, given that (i) this Court was "divided" when it issued the
same; and (ii) there were strong dissents to the majority opinion. It argues that this
Court has in the past revisited decisions already final and executory; there is no
hindrance for this Court to do the same in G.R. No. 207264.
Moreover, the OSG contends that:
Despite the finality of the June 25, 2013 Resolution and the October 22, 2013
Resolution, upholding the cancellation of respondent Reyes's CoC, there has been
no compelling reason for the House to withdraw its recognition of respondent
Reyes as Marinduque Representative, in the absence· of any specific order or
directive to the House. To be sure, there was nothing in the Honorable Court's
disposition in Reyes v. COMELEC that required any action from the House. Again,
it bears emphasis that neither petitioner nor respondents Speaker Belmonte and
Sec. Gen. Barna-Yap were parties in Reyes v. COMELEC.
Further, records with the HRET show that the following cases have been filed
against respondent Reyes:
(i) Case No. 13-036 (Quo Warranto), entitled Noeme Mayores Tan &
Jeasseca L. Mapacpac v. Regina Ongsiako Reyes;
(ii) Case No. 13-037 (Quo Warranto), entitled Eric D. Junio v. Regina
Ongsiako Reyes;
(iii) Case No. 13-027 (Quo Warranto ), entitled Christopher Matienzo v.
Regina Ongsiako Reyes; and
(iv) Case No. 13-028 (Election Protest), entitled Lord Allan Jay
Velasco v. Regina Ongsiako Reyes.33
And in view of the cases filed in the HRET, the OSG insists that:
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If the jurisdiction of the COMELEC were to be retained until the assumption of
office of the winner, at noon on the thirtieth day of June next following the election,
then there would obviously be a clash of jurisdiction between the HRET and the
COMELEC, given that the 2011 HRET Rules provide that the appropriate cases
should be filed before it within 15 days from the date of proclamation of the winner.
If, as the June 25, 2013 Resolution provides, the HRET's jurisdiction begins only
after assumption of office, at noon of June 30 following the election, then quo
warranto petitions and election protests filed on or after said date would be
dismissed outright by the HRET under its own rules for having been filed out of
time, where the winners have already been proclaimed within the period after the
May elections and up to June 14.34
In recent development, however, the HRET promulgated a Resolution on
December 14, 2015 dismissing HRET Case Nos. 13-036 and 13-037,35 the twin
petitions for quo warranto filed against Reyes, to wit:
WHEREFORE, in view of the foregoing, the September 23, 2014 Motion for
Reconsideration of Victor Vela Sioco is hereby GRANTED. The September 11,
2014 Resolution of [the] Tribunal is hereby REVERSED and SET ASIDE.
Accordingly, the present Petitions for Quo Warranto are hereby DISMISSED for
lack of jurisdiction.36
In the said Resolution, the HR.ET held that "the final Supreme Court ruling in GR.
No. 207264 is the COGENT REASON to set aside the September 11, 2014
Resolution."37
To make clear, the September 11, 2014 Resolution of the HRET ordered the
dismissal of a Petition-In-Intervention filed by one Victor Vela Sioco (Sioco) in the
twin petitions for quo warranto, for "lack of merit." Further, the HRET directed "the
hearing and reception of evidence of the two Petitions for Quo Warranto against x
x x Respondent [Reyes] to proceed. "38 Sioco, however, moved for the
reconsideration of the said September 11, 2014 HR.ET Resolution based on the
argument that the latter was contrary to law and jurisprudence given the Supreme
Court ruling in G.R. No. 207264.
Subsequently, the December 14, 2015 Resolution of the HRET held that-
The Tribunals Jurisdiction
It is necessary to clarify the Tribunal's jurisdiction over the present petitions for quo
warranto, considering the parties' divergent postures on how the Tribunal should
resolve the same vis-a-vis the Supreme Court ruling in G.R. No. 207264.
The petitioners believe that the Tribunal has jurisdiction over their petitions. They
pray that "after due proceedings," the Tribunal "declare Respondent REGINA
ONGSIAKO REYES DISQUALIFIED/INELIGIBLE to sit as Member of the House of
Representatives, representing the Province of Marinduque." In addition, the
petitioner Eric Del Mundo Junio urges the Tribunal to follow the Supreme Court
pronouncement in G.R. No. 207264.
On the other hand, Victor Vela Sioco, in his Petition-In-Intervention, pleads for the
outright dismissal of the present petitions considering the Supreme Court final
ruling in G.R. No. 207264. For her part, respondent Regina Reyes prays too for the
dismissal of the present petitions, albeit after reception of evidence by the
contending parties.
The constitutional mandate of the Tribunal is clear: It is "the sole judge of all
contests relating to the election, returns, and qualifications of [House] Members."
Such power or authority of the Tribunal is echoed in its 2011 Rules of the House of
Representatives Electoral Tribunal: "The Tribunal is the sole judge of all contests
relating to the elections, returns, and qualifications of the Members of the House of
Representatives."
xxxx
In the present cases, before respondent Regina Reyes was proclaimed on May 18,
2013, the COMELEC En Banc, in its Resolution of May 14, 2013 in SPA No. 13-
053 (DC), had already resolved that the COMELEC First Division correctly
cancelled her COC on the ground that she lacked the Filipino citizenship and
residency requirements. Thus, the COMELEC nullified her proclamation. When
Regina Reyes challenged the COMELEC actions, the Supreme Court En Banc, in
its Resolution of June 25, 2013 in G.R. No. 207246, upheld the same.
With the COMELEC's cancellation of respondent Regina Reyes' COC, resulting in
the nullification of her proclamation, the Tribunal, much as we would want to,
cannot assume jurisdiction over the present petitions. The jurisdiction of the HRET
begins only after the candidate is considered a Member of the House of
Representatives. And to be considered a Member of the House of
Representatives, there must be a concurrence of the following requisites: (1) a
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valid proclamation, (2) a proper oath, and (3) assumption of office, so the Supreme
Court pronounced in its Resolution of June 25, 2013 in G.R. No. 207264, thus:
x x x, the jurisdiction of the HRET begins only after the candidate is considered
a Member of the House of Representatives, as stated in Section 17, Article VI of
the 1987 Constitution:
xxxx
As held in Marcos v. COMELEC, the HRET does not have jurisdiction over a
candidate who is not a member of the House of Representatives x x x.
xxxx
The next inquiry, then, is when is a candidate considered a Member of the House
of Representatives?
In Vinzons-Chato v. COMELEC, citing Aggabao v.
COMELEC and Guerrero v. COMELEC, the Court ruled that:
The Court has invariably held that once a winning candidate has been proclaimed,
taken his oath, and assumed office as a Member of the House of Representatives,
the COMELEC's jurisdiction over election contests relating to his election, returns,
and qualifications ends, and the HRET's own jurisdiction begins.xx x
From the foregoing, it is then clear that to be considered a Member of the House of
Representatives, there must be a concurrence of the following requisites: (1)
a valid proclamation, (2) a proper oath, and (3) assumption of office x x x.
Based on the above-quoted ruling of the Supreme Court, a valid proclamation is
the first essential element before a candidate can be considered a Member of the
House of Representatives over which the Tribunal could assume jurisdiction. Such
element is obviously absent in the present cases as Regina Reyes' proclamation
was nullified by the COMELEC, which nullification was upheld by the Supreme
Court. On this ground alone, the Tribunal is without power to assume jurisdiction
over the present petitions since Regina Reyes "cannot be considered a Member of
the House of Representatives," as declared by the Supreme Court En Banc in
G.R. No. 207264. It further stresses:
"x x x there was no basis for the proclamation of petitioner [Regina Reyes] on 18
May 2013. Without the proclamation, the petitioner's oath of office is likewise
baseless, and without a precedent oath of office, there can be no valid and
effective assumption of office."
The Supreme Court has spoken. Its pronouncements must be respected. Being
the ultimate guardian of the Constitution, and by constitutional design, the
Supreme Court is "supreme in its task of adjudication; x x x. As a rule, all decisions
and determinations in the exercise of judicial power ultimately go to and stop at the
Supreme Court whose judgment is final." This Tribunal, as all other courts, must
take their bearings from the decisions and rulings of the Supreme Court. 39
Incidentally, it appears that an Information against Reyes for violation of Article 1
77 (Usurpation of Official Functions) of the Revised Penal Code, dated August 3,
2015, has been filed in court,40 entitled "People of the Philippines v. Regina
Ongsiako Reyes. "41
The Issue
The issue for this Court's resolution boils down to the propriety of issuing a writ
of mandamus to compel Speaker Belmonte, Jr. and Sec. Gen. Barua-Yap to
perform the specific acts sought by Velasco in this petition.
The Ruling
The petition has merit.
At the outset, this Court observes that the respondents have taken advantage of
this petition to re-litigate what has been settled in G.R. No. 207264. Respondents
are reminded to respect the Entry of Judgment that has been issued therein on
October 22, 2013.
After a painstaking evaluation of the allegations in this petition, it is readily
apparent that this special civil action is really one for mandamus and not a quo
warranto case, contrary to the asseverations of the respondents.
A petition for quo warranto is a proceeding to determine the right of a person to the
use or exercise of a franchise or office and to oust the holder from its enjoyment, if
his claim is not well-founded, or if he has forfeited his right to enjoy the privilege.
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Where the action is filed by a private person, he must prove that he is entitled to
the controverted position; otherwise, respondent has a right to the undisturbed
possession of the office.42 In this case, given the present factual milieu, i.e., (i) the
final and executory resolutions of this Court in G.R. No. 207264; (ii) the final and
executory resolutions of the COMELEC in SPA No. 13-053 (DC) cancelling
Reyes's Certificate of Candidacy; and (iii) the final and executory resolution of the
COMELEC in SPC No. 13-010 declaring null and void the proclamation of Reyes
and proclaiming Velasco as the winning candidate for the position of
Representative for the Lone District of the Province of Marinduque - it cannot be
claimed that the present petition is one for the determination of the right of Velasco
to the claimed office.
To be sure, what is prayed for herein is merely the enforcement of clear legal
duties and not to try disputed title. That the respondents make it appear so will not
convert this petition to one for quo warranto.
Section 3, Rule 65 of the Rules of Court, as amended, provides that any person
may file a verified petition for mandamus "when any tribunal, corporation, board,
officer or person unlawfully neglects the performance of an act which the law
specifically enjoins as a duty resulting from an office, trust, or station, or unlawfully
excludes another from the use and enjoyment of a right or office to which such
other is entitled, and there is no other plain, speedy and adequate remedy in the
ordinary course of law." A petition for mandamus will prosper if it is shown that the
subject thereof is a ministerial act or duty, and not purely discretionary on the part
of the board, officer or person, and that the petitioner has a well-defined, clear and
certain right to warrant the grant thereof.43
The difference between a ministerial and discretionary act has long been
established. A purely ministerial act or duty is one which an officer or tribunal
performs in a given state of facts, in a prescribed manner, in obedience to the
mandate of a legal authority, without regard to or the exercise of his own judgment
upon the propriety or impropriety of the act done. If the law imposes a duty upon a
public officer and gives him the right to decide how or when the duty shall be
performed, such duty is discretionary and not ministerial. The duty is ministerial
only when the discharge of the same requires neither the exercise of official
discretion or judgment.44
As the facts stand in this case, Speaker Belmonte, Jr. and Sec. Gen. Barua-Y ap
have no discretion whether or not to administer the oath of office to Velasco and to
register the latter's name in the Roll of Members of the House of Representatives,
respectively. It is beyond cavil that there is in existence final and executory
resolutions of this Court in G.R. No. 207264 affirming the final and executory
resolutions of the COMELEC in SPA No. 13-053 (DC) cancelling Reyes's
Certificate of Candidacy. There is likewise a final and executory resolution of the
COMELEC in SPC No. 13-010 declaring null and void the proclamation of Reyes,
and proclaiming Velasco as the winning candidate for the position of
Representative for the Lone District of the Province of Marinduque.
The foregoing state of affairs collectively lead this Court to consider the facts as
settled and beyond dispute - Velasco is the proclaimed winning candidate for
the Representative of the Lone District of the Province of Marinduque.
Reyes argues in essence that this Court is devoid of original jurisdiction to annul
her proclamation. Instead, it is the HRET that is constitutionally mandated to
resolve any questions regarding her election, the returns of such election, and her
qualifications as a Member of the House of Representatives especially so that she
has already been proclaimed, taken her oath, and started to discharge her duties
as a Member of the House of Representatives representing the Lone District of the
Province of Marinduque. But the confluence of the three acts in this case - her
proclamation, oath and assumption of office - has not altered the legal situation
between Velasco and Reyes.
The important point of reference should be the date the COMELEC finally decided
to cancel the Certificate of Candidacy (COC) of Reyes which was on May 14,
2013. The most crucial time is when Reyes's COC was cancelled due to her non-
eligibility to run as Representative of the Lone District of the Province of
Marinduque - for without a valid COC, Reyes could not be treated as a
candidate in the election and much less as a duly proclaimed winner. That
particular decision of the COMELEC was promulgated even before Reyes' s
proclamation, and which was affirmed by this Court's final and
executory Resolutions dated June 25, 2013 and October 22, 2013.
This Court will not give premium to the illegal actions of a subordinate entity of the
COMELEC, the PBOC who, despite knowledge of the May 14, 2013 resolution of
the COMELEC En Banc cancelling Reyes' s COC, still proclaimed her as the
winning candidate on May 18, 2013. Note must also be made that as early as May
16, 2013, a couple of days before she was proclaimed, Reyes had already
received the said decision cancelling her COC. These points clearly show that the
much argued proclamation was made in clear defiance of the said COMELEC En
Banc Resolution.
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That Velasco now has a well-defined, clear and certain right to warrant the grant of
the present petition for mandamus is supported by the following undisputed facts
that should be taken into consideration:
First. At the time of Reyes's proclamation, her COC was already cancelled
by the COMELEC En Banc in its final finding in its resolution dated May
14, 2013, the effectivity of which was not enjoined by this Court, as Reyes
did not avail of the prescribed remedy which is to seek a restraining order
within a period of five (5) days as required by Section 13(b), Rule 18 of
COMELEC Rules. Since no restraining order was forthcoming, the PBOC
should have refrained from proclaiming Reyes.
Second. This Court upheld the COMELEC decision cancelling respondent
Reyes's COC in its Resolutions of June 25, 2013 and October 22, 2013
and these Resolutions are already final and executory.
Third. As a consequence of the above events, the COMELEC in SPC No.
13-010 cancelled respondent Reyes's proclamation and, in turn,
proclaimed Velasco as the duly elected Member of the House of
Representatives in representation of the Lone District of the Province of
Marinduque. The said proclamation has not been challenged or
questioned by Reyes in any proceeding.
Fourth. When Reyes took her oath of office before respondent Speaker
Belmonte, Jr. in open session, Reyes had NO valid COC NOR a valid
proclamation.
Thus, to consider Reyes' s proclamation and treating it as a material fact in
deciding this case will paradoxically alter the well-established legal milieu
between her and Velasco.
Fifth. In view of the foregoing, Reyes HAS ABSOLUTELY NO LEGAL
BASIS to serve as a Member of the House of Representatives for the
Lone District of the Province of Marinduque, and therefore, she HAS NO
LEGAL PERSONALITY to be recognized as a party-respondent at a quo
warranto proceeding before the HRET.
And this is precisely the basis for the HRET' s December. 14, 2015 Resolution
acknowledging and ruling that it has no jurisdiction over the twin petitions for quo
warranto filed against Reyes. Its finding was based on the existence of a final and
executory ruling of this Court in G.R. No. 207264 that Reyes is not a bona
fide member of the House of Representatives for lack of a valid proclamation. To
reiterate this Court's pronouncement in its Resolution, entitled Reyes v.
Commission on Elections45-
The averred proclamation is the critical pointer to the correctness of petitioner's
submission. The crucial question is whether or not petitioner [Reyes] could be
proclaimed on 18 May 2013. Differently stated, was there basis for the
proclamation of petitioner on 18 May 2013?
Dates and events indicate that there was no basis for the proclamation of petitioner
on 18 May 2013. Without the proclamation, the petitioner's oath of office is likewise
baseless, and without a precedent oath of office, there can be no valid and
effective assumption of office.
xxxx
"More importantly, we cannot disregard a fact basic in this controversy - that
before the proclamation of petitioner on 18 May 2013, the COMELEC En Banc had
already finally disposed of the issue of petitioner's [Reyes] lack of Filipino
citizenship and residency via its Resolution dated 14 May 2013. After 14 May
2013, there was, before the COMELEC, no longer any pending case on
petitioner's qualifications to run for the position of Member of the House of
Representatives. x x x."
As the point has obviously been missed by the petitioner [Reyes] who continues to
argue on the basis of her "due proclamation," the instant motion gives us the
opportunity to highlight the undeniable fact we here repeat that the proclamation
which petitioner secured on 18 May 2013 was WITHOUT ANY BASIS."
(Emphasis supplied.)
Put in another way, contrary to the view that the resort to the jurisdiction of the
HRET is a plain, speedy and adequate remedy, such recourse is not a legally
available remedy to any party, specially to Velasco, who should be the sitting
Member of the House of Representatives if it were not for the disregard by the
leadership of the latter of the binding decisions of a constitutional body, the
COMELEC, and the Supreme Court
Though the earlier existence of the twin quo warranto petitions filed against Reyes
before the HRET had actually no bearing on the status of finality of the decision of
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the COMELEC in SPC No. 13-010. Nonetheless, their dismissal pursuant to the
HRET' s December 14, 2015 Resolution sustained Velasco's well-defined, clear
and certain right to the subject office.
The present Petition for Mandamus seeks the issuance of a writ of mandamus to
compel respondents Speaker Belmonte, Jr. and Sec. Gen. Barua-Yap
to acknowledge and recognize the final and executory Decisions and Resolution
of this Court and of the COMELEC by administering the oath of office to Velasco
and entering the latter's name in the Roll of Members of the House of
Representatives. In other words, the Court is called upon to determine whether or
not the prayed for acts, i.e., (i) the administration of the oath of office to Velasco;
and (ii) the inclusion of his name in the Roll of Members, are ministerial in
character vis-a-vis the factual and legal milieu of this case. As we have previously
stated, the administration of oath and the registration of Velasco in the Roll of
Members of the House of Representatives for the Lone District of the Province of
Marinduque are no longer a matter of discretion or judgment on the part of
Speaker Belmonte, Jr. and Sec. Gen. Barua-Yap. They are legally duty-bound to
recognize Velasco as the duly elected Member of the House of Representatives
for the Lone District of Marinduque in view of the ruling rendered by this Court and
the COMELEC'S compliance with the said ruling, now both final and executory.
It will not be the first time that the Court will grant Mandamus to compel the
Speaker of the House of Representatives to administer the oath to the rightful
Representative of a legislative district and the Secretary-General to enter said
Representative's name in the Roll of Members of the House of Representatives.
In Codilla, Sr. v. De Venecia,46 the Court decreed:
Under Rule 65, Section 3 of the 1997 Rules of Civil Procedure, any person may file
a verified petition for mandamus "when any tribunal, corporation, board, officer or
person unlawfully neglects the performance of an act which the law specifically
enjoins as a duty resulting from an office, trust, or station, or unlawfully excludes
another from the use and enjoyment of a right or office to which such other is
entitled, and there is no other plain, speedy and adequate remedy in the ordinary
course of law." For a petition for mandamus to prosper, it must be shown that the
subject of the petition for mandamus is a ministerial act or duty, and not purely
discretionary on the part of the board, officer or person, and that the petitioner has
a well-defined, clear and certain right to warrant the grant thereof.
The distinction between a ministerial and discretionary act is well delineated. A
purely ministerial act or duty is one which an officer or tribunal performs in a given
state of facts, in a prescribed manner, in obedience to the mandate of a legal
authority, without regard to or the exercise of his own judgment upon the propriety
or impropriety of the act done. If the law imposes a duty upon a public officer and
gives him the right to decide how or when the duty shall be performed, such duty is
discretionary and not ministerial. The duty is ministerial only when the discharge of
the same requires neither the exercise of official discretion or judgment.
In the case at bar, the administration of oath and the registration of the petitioner in
the Roll of Members of the House of Representatives representing the 4th
legislative district of Leyte is no longer a matter of discretion on the part of the
public respondents. The facts are settled and beyond dispute: petitioner garnered
71,350 votes as against respondent Locsin who only got 53,447 votes in the May
14, 2001 elections. The COMELEC Second Division initially ordered the
proclamation of respondent Locsin; on Motion for Reconsideration the
COMELEC en banc set aside the order of its Second Division and ordered the
proclamation of the petitioner. The Decision of the COMELEC en banc has not
been challenged before this Court by respondent Locsin and said Decision has
become final and executory.
In sum, the issue of who is the rightful Representative of the 4th legislative district
of Leyte has been finally settled by the COMELEC en banc, the constitutional body
with jurisdiction on the matter. The rule of law demands that its Decision be
obeyed by all officials of the land There is no alternative to the rule of law except
the reign of chaos and confusion.
IN VIEW WHEREOF, the Petition for Mandamus is granted. Public Speaker of the
House of Representatives shall administer the oath of petitioner EUFROCINO M.
CODILLA, SR., as the duly-elected Representative of the 4th legislative district of
Leyte. Public respondent Secretary-General shall likewise register the name of the
petitioner in the Roll of Members of the House of Representatives after he has
taken his oath of office. This decision shall be immediately executory. (Citations
omitted.)
Similarly, in this case, by virtue of (i) COMELEC en bane Resolution dated May 14,
2013 in SPA No. 13-053 (DC); (ii) Certificate of Finality dated June 5, 2013 in SPA
No. 13-053 (DC); (iii) COMELEC en banc Resolution dated June 19, 2013 in SPC
No. 13-010; (iv) COMELEC en banc Resolution dated July 10, 2013 in SPA No.
13-053 (DC); and (v) Velasco's Certificate of Proclamation dated July 16,
2013, Velasco is the rightful Representative of the Lone District of the
Province of Marinduque; hence, entitled to a writ of Mandamus.
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As to the view of Reyes and the OSG that since Velasco, Speaker Belmonte, Jr.
and Sec. Gen. Barna-Yap are not parties to G.R. No. 207264, Velasco can neither
ask for the enforcement of the Decision rendered therein nor argue that the
doctrine of res judieata by conclusiveness of judgment applies to him and the
public respondents, this Court maintains that such contention is incorrect. Velasco,
along with public respondents Speaker Belmonte, Jr. and Sec. Gen. Barna-Yap,
are all legally bound by this Court's judgment in G.R. No. 207264, i.e., essentially,
that the COMELEC correctly cancelled Reyes' s COC for Member of the House of
Representatives for the Lone District of the Province of Marinduque on the ground
that the latter was ineligible for the subject position due to her failure to prove her
Filipino citizenship and the requisite one-year residency in the Province of
Marinduque. A contrary view would have our dockets unnecessarily clogged with
petitions to be filed in every direction by any and all registered voters not a party to
a case to question the final decision of this Court. Such restricted interpretation
of res judieata is intolerable for it will defeat this Court's ruling in G.R. No. 207264.
To be sure, Velasco who was duly proclaimed by COMELEC is a proper party to
invoke the Court's final judgment that Reyes was ineligible for the subject
position.47
It is well past the time for everyone concerned to accept what has been
adjudicated and take judicial notice of the fact that Reyes's ineligibility to run for
and be elected to the subject position had already been long affirmed by this
Court. Any ruling deviating from such established ruling will be contrary to the Rule
of Law and should not be countenanced.
In view of finality of the rulings in G.R. No. 207264, SPA No. 13-053 (DC) and SPC
No. 13-010, there is no longer any issue as to who is the rightful Representative of
the Lone District of the Province of Marinduque; therefore, to borrow the
pronouncement of this Court, speaking through then Associate Justice Reynato S.
Puno, in Codilla, Sr. v. De Venecia,48 "[t]he rule of law demands that its Decision
be obeyed by all officials of the land. There is no alternative to the rule of law
except the reign of chaos and confusion."
WHEREFORE, the Petition for Mandamus is GRANTED. Public respondent Hon.
Feliciano R. Belmonte, Jr., Speaker, House of Representatives, shall administer
the oath of office of petitioner Lord Allan Jay Q. Velasco as the duly-elected
Representative of the Lone District of the Province of Marinduque. And public
respondent Hon. Marilyn B. Barua-Yap, Secretary General, House of
Representatives, shall register the name of petitioner Lord Allan Jay Q. Velasco in
the Roll of Members of the House of Representatives after he has taken his oath of
office. This Decision shall be IMMEDIATELY EXECUTORY.
SO ORDERED.
EXPROPRIATION
G.R. No. 142304 June 20, 2001
CITY OF MANILA, petitioner,
vs.
OSCAR, FELICITAS, JOSE, BENJAMIN, ESTELITA, LEONORA AND
ADELAIDA, ALL SURNAMED SERRANO, respondents.
Mendoza, J.:
This is a petition for review on certiorari of the decision, dated November 16, 1999,
and resolution, dated February 23, 2000, of the Court of Appeals reversing the
order, dated December 15, 1998, of the Regional Trial Court, Branch 16, Manila
and perpetually enjoining it from proceeding with the petitioner's complaint for
eminent domain in Civil Case No. 94-72282.
The facts are as follows:
On December 21, 1993, the City Council of Manila enacted the Ordinance No.
7833, authorizing the expropriation of certain properties in Manila 's First District in
Tondo, covered by TCT Nos. 70869, 105201, 105202, and 138273 of the Register
of Deeds of Manila, which are to be sold and distributed to qualified occupants
pursuant to the Land Use Development Program of the City of Manila.
One of the properties sought to be expropriated, denominated as Lot 1-C, consists
of 343.10 square meters. It is covered by TCT No. 138272 which was derived from
TCT No. 70869 issued in the name of Feliza De Guia.1 After her death, the estate
of Feliza De Guia was settled among her heirs by virtue of a compromise
agreement, which was duly approved by the Regional Trial Court, Branch 53,
Manila in its decision, dated May 8, 1986.2 In 1989, Alberto De Guia, one of the
heirs of Feliza De Guia, died, as a result of which his estate, consisting of his
share in the properties left by his mother, was partitioned among his heirs. Lot 1-C
was assigned to Edgardo De Guia, one of the heirs of Alberto De Guia.3 On April
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15, 1994, Edgardo De Guia was issued TCT No. 215593, covering Lot 1-C.4On
July 29, 1994, the said property was transferred to Lee Kuan Hui, in whose name
TCT No. 217018 was issued.5
The property was subsequently sold on January 24,1996 to Demetria De Guia to
whom TCT No. 226048 was issued.6
On September 26, 1997, petitioner City of Manila filed an amended complaint for
expropriation, docketed as Civil Case No. 94-72282, with the Regional Trial Court,
Branch 16, Manila, against the supposed owners of the lots covered by TCT Nos.
70869 (including Lot 1-C), 105201, 105202 and 138273, which included herein
respondents Oscar, Felicitas, Jose, Benjamin, Estelita, Leonora, Adelaida, all
surnamed are Serrano.7 On November 12, 1997, respondents filed a consolidated
answer, in which they alleged that their mother, the late Demetria De Guia, had
acquired Lot l-C from Lee Kian Hui; that they had been the bona fide occupants of
the said parcel of land for more than 40 years; that the expropriation of Lot l-C
would result in their disclosure, it being the only residential land left to them by
their deceased mother; and that the said lot was exempt from expropriation
because dividing the said parcel of land among them would entitle each of them to
only about 50 square meters of land. Respondents, therefore, prayed that
judgment be rendered declaring Lot l-C exempt from expropriation and ordering
the cancellation of the notice annotated on the back of TCT No.
226048,8 regarding the pendency of Civil Case No. 94-72282. for eminent domain
filed by petitioner.9
Upon motion by petitioner, the trial court issued an order, dated October 9, 1998,
directing petitioner to deposit the amount of Pl,825,241.00 equivalent to the
assessed value of the properties.10 After petitioner had made the deposit, the trial
court issued another order, dated December 15, 1998, directing the issuance of a
writ of possession in favor of petitioner.ll
Respondents filed a petition for certiorari with the Court of Appeals, alleging that
the expropriation of Lot l-C would render respondents, who are actual occupants
thereof, landless; that Lot l-C is exempt from expropriation because R.A. No. 7279
provides that properties consisting of residential lands not exceeding 300 square
meters in highly urbanized cities are exempt from expropriations; that respondents
would only receive around 49 square meters each after the partition of Lot l-C
which consists of only 343.10 square meters; and that R.A. No. 7279 was not
meant to deprive an owner of the entire residential land but only that in excess of
300 square meters.12
On November 16, 1999, the Court of Appeals rendered a decision holding that Lot
l-C is not exempt from expropriation because it undeniably exceeds 300 square
meters which is no longer considered a small property within the framework of R.A.
No. 7279. However, it held that in accordance with the ruling in Filstream
International Inc. v. Court of Appeals,13 the other modes of acquisition of lands
enumerated in §§9-10 of the law must first be tried by the city government before it
can resort to expropriation. As petitioner failed to show that it had done so, the
Court of Appeals gave judgment for respondents and enjoined petitioner from
expropriating Lot 1-C. The dispositive portion of its decision reads:
WHEREFORE, in view of all the foregoing, the instant petition is hereby
GIVEN DUE COURSE and accordingly GRANTED. The Order, dated
December 15, 1998, denying petitioner's motion for reconsideration issued
by the respondent Regional Trial Court of Manila, Branch 16, in Civil Case
No. 94-72282 is hereby REVERSED and SET ASIDE. Let a writ of
injunction issue perpetually enjoining the same respondent court from
proceeding with the complaint for eminent domain in Civil Case No. 94-
72282,14
In its resolution, dated February 23, 2000, the Court of Appeals likewise denied
two motions for reconsideration filed by petitioner.l5 Hence this petition. Petitioner
contends that the Court of Appeals erred in --
1) Giving due course to the petition of the Serranos under Rule 65
notwithstanding its own declaration of the impropriety of the resort to the
writ and filing thereof with the wrong appellate court;
2) Concluding that the Order of October 9, 1998 which authorizes the
immediate entry of the City as the expropriating agency into the property
sough to be expropriated upon the deposit of the provisionally fixed fair
market value thereof as tantamount to condemnation of the property
without prior showing of compliance with the acquisition of other lands
enumerated in Sec. 9 of R.A. 7279 ergo a violation of due process of the
Serranos by the doctrinaire application of FILSTREAM ruling and
corrollarily,
3) In prohibiting permanently, by writ of injunction, the trial court from
proceeding with a complaint for expropriation of the City in Civil Case No.
94-72282.16
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We will deal with these contentions in the order they are presented.
First. Petitioner contends that the respondents' remedy against the order of the
trial court granting a writ of possession was not to file a petition for certiorari under
Rule 65 but a petition for review under Rule 45 which should have been filed in the
Supreme Court.17
This contention has no merit. A petition for review under Rule 45 is a mode of
appeal. Accordingly, it could not have been resorted to by the respondents
inasmuch as the order of the trial court granting a writ of possession was merely
interlocutory from which no appeal could be taken. Rule 45, §1 of the 1997 Rules
for Civil Procedure applies only to final judgments or orders of the Court of
Appeals, the Sandiganbayan, and the Regional Trial Court. On the other hand, a
petition for certiorari is the suitable remedy in view of Rule 65, §1 which provides:
When any tribunal, board or officer exercising judicial or quasi-judicial
functions has acted without or in excess of its or his jurisdiction, or with
grave abuse of discretion amounting to lack or excess of jurisdiction, and
there is no appeal, nor any plain, speedy, and adequate remedy in the
ordinary course of law, a person aggrieved thereby may file a verified
petition in the proper court, alleging the facts with certainly and praying
that judgment be rendered annulling or modifying the proceedings of such
tribunal, board or officer, and granting such incidental reliefs as laws and
justice may require.
Respondents' petition before the Court of Appeals alleged that the trial court had
acted without or in excess of its jurisdiction or with grave abuse of discretion
amounting to lack of jurisdiction in issuing the order, dated December 15, 1998,
resolving that Lot 1-C is not exempt from expropriation and ordering the issuance
of the writ of possession in favor of petitioner.18
Second. Petitioner faults the Court of Appeals for deciding issues not raised in the
trial court, specifically the question of whether or not there was compliance with
§§9 and 10 of RA. No. 7279. It argues that the sole defense set up by respondents
in their petition before the Court of Appeals was that their property was exempted
from expropriation because it comes within the purview of a "small property" as
defined by R.A. No. 7279 . Accordingly, the Court of Appeals should not have
applied the doctrine laid down by this Court in the Filstream19 case as such issue
was not raised by respondents in their petition before the Court of Appeals.
This contention likewise has no merit. In their petition before the Court of Appeals,
respondents raised the following issues:
1. Whether or not the subject Lot 1-C with an area of 343.10 square
meters covered by T.C.T. No. 226048 in the name of petitioners' mother,
the late Demetria [De Guia] Serrano, may be lawfully expropriated "for the
public purpose of providing landless occupants thereof homelots of their
own under the "land-for-the landless program of respondent City of
Manila."
2. Whether or not the expropriation of the said Lot l-C by respondent City
of Manila violates the equal protection clause of the Constitution, since
petitioners, with the exemption of petitioner Oscar G. Serranno, who are
likewise landless are actual occupants hereof.
3. Whether or not Lot 1-C is or may be exempted from expropriation
pursuant to R.A. 7279, otherwise known as the Urban Development and
Housing Act of 1992.20
It is clear that respondents raised in issue the propriety of the expropriation of their
property in connection with RA. No. 7279. Although what was discussed at length
in their petition before the Court of Appeals was whether or not the said property
could be considered a small property within the purview of the exemption under
the said law, the other provisions of the said law concerning expropriation
proceedings need also be looked into to address the first issue raised by the
respondents and to determine whether or not expropriation of Lot 1-C was proper
under the circumstances. The Court of Appeals properly considered relevant
provisions of R A. No.7279 to determine the issues raised by respondents.
Whether or not it correctly applied the doctrine laid down in Filstream in resolving
the issues raised by respondents, however, is a different matter altogether, and
this brings us to the next point.
Third. Petitioner contends that the Court of Appeals erroneously presumed that Lot
1-C has been ordered condemned in its favor when the fact is that the order of the
trial court, dated December 15, 1998, merely authorized the issuance of a writ of
possession and petitioner's entry into the property pursuant to Rule 67, §2. At that
stage, it was premature to determine whether the requirements of RA. No. 7279,
§§9 - 10 have been complied with since no evidentiary hearing had yet been
conducted by the trial court.21
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This contention is well taken. Rule 67, §2 provides:
Upon the filing of the complaint or at any time thereafter and after due
notice to the defendant, the plaintiff shall have the right to take or enter
upon possession of the real property involved if he deposits with the
authorized government depository an amount equivalent to the assessed
value of the property for purposes of taxation to be held by such bank
subject to the orders of the court. Such deposit shall be in money, unless
in lieu thereof the court authorizes the deposit of a certificate of deposit of
a government bank of the Republic of the Philippines payable on demand
to the authorized government depositary.
If personal property is involved, its value shall be provisionally ascertained
and the amount to be deposited shall be fixed by the court.
After such deposit is made the court shall order the sheriff or other proper
officer to forthwith place the plaintiff in possession of the property involved
and promptly submit a report thereof to the court with service of copies to
the parties.
Thus, a writ of execution may be issued by a court upon the filing by the
government of a complaint for expropriation sufficient in form and substance and
upon deposit made by the government of the amount equivalent to the assessed
value of the property subject to expropriation. Upon compliance with these
requirements, the issuance of the writ of possession becomes ministerial.22 In this
case, these requirements were satisfied and, therefore, it became the ministerial
duty of the court to issue the writ of possession.
The Court of Appeals, however, ruled that petitioner failed to comply with the
requirements laid down in §§9 - 10 of RA. No. 7279 and reiterated
in Filstream ruling. This is error. The ruling in the Filstream was necessitated
because an order of condemnation had already been issued by the trial court in
that case. Thus, the judgment in that case had already become final. In this case,
the trial court has not gone beyond the issuance of a writ of possession. Hearing is
still to be held to determine whether or not petitioner indeed complied with the
requirements provided in RA. No. 7279. It is, therefore, premature at this stage of
the proceedings to find that petitioner resorted expropriation without first trying the
other modes of acquisition enumerated in § 10 of the law.
RA. No 7279 in pertinent parts provide:
SEC. 9. Priorities in the Acquisition of Land… Lands for socialized housing
shall be acquired in the following order:
(a) Those owned by the Government or any of its subdivisions,
instrumentalities, or agencies, including government owned and controlled
corporations and their subsidiaries;
(b) Alienable lands of the public domain;
(c) Unregistered or abandoned and idle lands;
(d) Those within the declares Areas or Priority Development, Zone
Improvement Program sites, and Slum Improvement and Resettlement
Programs sites which have not yet been acquired;
(e) Bagong Lipunan Improvement and Sites and Services or BLISS sites
which have not yet been acquired, and;
(f) Privately-owned lands.
Where on-site development is found more practicable and advantageously
to the beneficiaries, the priorities mentioned in this section shall not apply.
The local government units shall give budgetary priority on-site
development of government lands.
SEC. 10. Modes of Lands Acquisition. -- The modes of acquiring lands for
purposes of this Act shall include, amount others, community mortgage,
land swapping, land assembly or consolidation, land banking, donation to
the Government, joint-venture agreement, negotiated purchase, and
expropriation: Provided, however; That expropriation shall be resorted to
only when other modes of acquisition have been exhausted: Provided,
further; That were expropriation is resorted to, parcels of land owned by
small property owners shall be exempted for purposes of this
Act: Provided finally, That abandoned property, as herein defined, shall be
reverted and escheated to the State in a proceeding analogous to the
procedure laid down in Rule 91 of the Rules of Court.
For the purpose of socialized housing, government-owned and foreclosed
properties shall be acquired by the local government units, or by the
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 National Housing Authority primarily through negotiated
purchase: Provided, That qualified beneficiaries who are actual occupants
of the lands shall be given the right of first refusal.
Whether petitioner has complied with these provisions requires the presentation of
evidence, although in its amended complaint petitioner did allege that it had
complied with the requirements.23 The determination of this question must await
that hearing on the complaint for expropriation, particularly the hearing for the
condemnation of the properties sought to be expropriated. Expropriation
proceedings consist of two stages: first, condemnation of the property after it is
determined that its acquisition will be for a public purpose or public use and,
second, the determination of just compensation to be paid for the taking of the
private property to be made by the court with the assistance of not more than three
commissioners.24
WHEREFORE, the decision, dated November 16,1999, and resolution, dated
February 23, 2000, of the Court of Appeals are REVERSED and the order of the
trial court, dated December 15,1998, is REINSTATED. This case is REMANDED
to the trial court to further proceedings.1âwphi1.nêt
SO ORDERED.
G.R. No. 106804 August 12, 2004
NATIONAL POWER CORPORATION, petitioner,
vs.
COURT OF APPEALS and ANTONINO POBRE, respondents.
DECISION
CARPIO, J.:
The Case
Before us is a petition for review1 of the 30 March 1992 Decision2 and 14 August
1992 Resolution of the Court of Appeals in CA-G.R. CV No. 16930. The Court of
Appeals affirmed the Decision3 of the Regional Trial Court, Branch 17, Tabaco,
Albay in Civil Case No. T-552.
The Antecedents
Petitioner National Power Corporation ("NPC") is a public corporation created to
generate geothermal, hydroelectric, nuclear and other power and to transmit
electric power nationwide.4 NPC is authorized by law to acquire property and
exercise the right of eminent domain.
Private respondent Antonino Pobre ("Pobre") is the owner of a 68,969 square-
meter land ("Property") located in Barangay Bano, Municipality of Tiwi, Albay. The
Property is covered by TCT No. 4067 and Subdivision Plan 11-9709.
In 1963, Pobre began developing the Property as a resort-subdivision, which he
named as "Tiwi Hot Springs Resort Subdivision." On 12 January 1966, the then
Court of First Instance of Albay approved the subdivision plan of the Property. The
Register of Deeds thus cancelled TCT No. 4067 and issued independent titles for
the approved lots. In 1969, Pobre started advertising and selling the lots.
On 4 August 1965, the Commission on Volcanology certified that thermal mineral
water and steam were present beneath the Property. The Commission on
Volcanology found the thermal mineral water and steam suitable for domestic use
and potentially for commercial or industrial use.
NPC then became involved with Pobre's Property in three instances.
First was on 18 February 1972 when Pobre leased to NPC for one year eleven lots
from the approved subdivision plan.
Second was sometime in 1977, the first time that NPC filed its expropriation case
against Pobre to acquire an 8,311.60 square-meter portion of the Property.5 On 23
October 1979, the trial court ordered the expropriation of the lots upon NPC's
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payment of P25 per square meter or a total amount of P207,790. NPC began
drilling operations and construction of steam wells. While this first expropriation
case was pending, NPC dumped waste materials beyond the site agreed upon by
NPC with Pobre. The dumping of waste materials altered the topography of some
portions of the Property. NPC did not act on Pobre's complaints and NPC
continued with its dumping.
Third was on 1 September 1979, when NPC filed its second expropriation case
against Pobre to acquire an additional 5,554 square meters of the Property. This is
the subject of this petition. NPC needed the lot for the construction and
maintenance of Naglagbong Well Site F-20, pursuant to Proclamation No.
7396 and Republic Act No. 5092.7 NPC immediately deposited P5,546.36 with the
Philippine National Bank. The deposit represented 10% of the total market value of
the lots covered by the second expropriation. On 6 September 1979, NPC entered
the 5,554 square-meter lot upon the trial court's issuance of a writ of possession to
NPC.
On 10 December 1984, Pobre filed a motion to dismiss the second complaint for
expropriation. Pobre claimed that NPC damaged his Property. Pobre prayed for
just compensation of all the lots affected by NPC's actions and for the payment of
damages.
On 2 January 1985, NPC filed a motion to dismiss the second expropriation case
on the ground that NPC had found an alternative site and that NPC had already
abandoned in 1981 the project within the Property due to Pobre's opposition.
On 8 January 1985, the trial court granted NPC's motion to dismiss but the trial
court allowed Pobre to adduce evidence on his claim for damages. The trial court
admitted Pobre's exhibits on the damages because NPC failed to object.
On 30 August 1985, the trial court ordered the case submitted for decision since
NPC failed to appear to present its evidence. The trial court denied NPC's motion
to reconsider the submission of the case for decision.
NPC filed a petition for certiorari8 with the then Intermediate Appellate Court,
questioning the 30 August 1985 Order of the trial court. On 12 February 1987, the
Intermediate Appellate Court dismissed NPC's petition but directed the lower court
to rule on NPC's objections to Pobre's documentary exhibits.
On 27 March 1987, the trial court admitted all of Pobre's exhibits and upheld its
Order dated 30 August 1985. The trial court considered the case submitted for
decision.
On 29 April 1987, the trial court issued its Decision in favor of Pobre. The
dispositive portion of the decision reads:
WHEREFORE, premises considered, judgment is hereby rendered in
favor of the defendant and against the plaintiff, ordering the plaintiff to pay
unto the defendant:
(1) The sum of THREE MILLION FOUR HUNDRED FORTY
EIGHT THOUSAND FOUR HUNDRED FIFTY (P3,448,450.00)
PESOS which is the fair market value of the subdivision of
defendant with an area of sixty eight thousand nine hundred sixty
nine (68,969) square meters, plus legal rate of interest per annum
from September 6, 1979 until the whole amount is paid, and upon
payment thereof by the plaintiff the defendant is hereby ordered to
execute the necessary Deed of Conveyance or Absolute Sale of
the property in favor of the plaintiff;
(2) The sum of ONE HUNDRED FIFTY THOUSAND
(P150,000.00) PESOS for and as attorney's fees.
Costs against the plaintiff.
SO ORDERED.9
On 13 July 1987, NPC filed its motion for reconsideration of the decision. On 30
October 1987, the trial court issued its Order denying NPC's motion for
reconsideration.
NPC appealed to the Court of Appeals. On 30 March 1992, the Court of Appeals
upheld the decision of the trial court but deleted the award of attorney's fees. The
dispositive portion of the decision reads:
WHEREFORE, by reason of the foregoing, the Decision appealed from is
AFFIRMED with the modification that the award of attorney's fees is
deleted. No pronouncement as to costs.
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 SO ORDERED.10
The Court of Appeals denied NPC's motion for reconsideration in a Resolution
dated 14 August 1992.
The Ruling of the Trial Court
In its 69-page decision, the trial court recounted in great detail the scale and scope
of the damage NPC inflicted on the Property that Pobre had developed into a
resort-subdivision. Pobre's Property suffered "permanent injury" because of the
noise, water, air and land pollution generated by NPC's geothermal plants. The
construction and operation of the geothermal plants drastically changed the
topography of the Property making it no longer viable as a resort-subdivision. The
chemicals emitted by the geothermal plants damaged the natural resources in the
Property and endangered the lives of the residents.
NPC did not only take the 8,311.60 square-meter portion of the Property, but also
the remaining area of the 68,969 square-meter Property. NPC had rendered
Pobre's entire Property useless as a resort-subdivision. The Property has become
useful only to NPC. NPC must therefore take Pobre's entire Property and pay for it.
The trial court found the following badges of NPC's bad faith: (1) NPC allowed five
years to pass before it moved for the dismissal of the second expropriation case;
(2) NPC did not act on Pobre's plea for NPC to eliminate or at least reduce the
damage to the Property; and (3) NPC singled out Pobre's Property for piecemeal
expropriation when NPC could have expropriated other properties which were not
affected in their entirety by NPC's operation.
The trial court found the just compensation to be P50 per square meter or a total
of P3,448,450 for Pobre's 68,969 square-meter Property. NPC failed to contest
this valuation. Since NPC was in bad faith and it employed dilatory tactics to
prolong this case, the trial court imposed legal interest on the P3,448,450 from 6
September 1979 until full payment. The trial court awarded Pobre attorney's fees
of P150,000.
The Ruling of the Court of Appeals
The Court of Appeals affirmed the decision of the trial court. However, the
appellate court deleted the award of attorney's fees because Pobre did not
properly plead for it.
The Issues
NPC claims that the Court of Appeals committed the following errors that warrant
reversal of the appellate court's decision:
1. In not annulling the appealed Decision for having been rendered by the
trial court with grave abuse of discretion and without jurisdiction;
2. In holding that NPC had "taken" the entire Property of Pobre;
3. Assuming arguendo that there was "taking" of the entire Property, in not
excluding from the Property the 8,311.60 square-meter portion NPC had
previously expropriated and paid for;
4. In holding that the amount of just compensation fixed by the trial court
at P3,448,450.00 with interest from September 6, 1979 until fully paid, is
just and fair;
5. In not holding that the just compensation should be fixed at P25.00 per
square meter only as what NPC and Pobre had previously mutually
agreed upon; and
6. In not totally setting aside the appealed Decision of the trial court. 11
Procedural Issues
NPC, represented by the Office of the Solicitor General, insists that at the time that
it moved for the dismissal of its complaint, Pobre had yet to serve an answer or a
motion for summary judgment on NPC. Thus, NPC as plaintiff had the right to
move for the automatic dismissal of its complaint. NPC relies on Section 1, Rule 17
of the 1964 Rules of Court, the Rules then in effect. NPC argues that the dismissal
of the complaint should have carried with it the dismissal of the entire case
including Pobre's counterclaim.
NPC's belated attack on Pobre's claim for damages must fail. The trial court's
reservation of Pobre's right to recover damages in the same case is already
beyond review. The 8 January 1985 Order of the trial court attained finality when
NPC failed to move for its reconsideration within the 15-day reglementary period.
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NPC opposed the order only on 27 May 1985 or more than four months from the
issuance of the order.
We cannot fault the Court of Appeals for not considering NPC's objections against
the subsistence of Pobre's claim for damages. NPC neither included this issue in
its assignment of errors nor discussed it in its appellant's brief. NPC also failed to
question the trial court's 8 January 1985 Order in the petition for certiorari12 it had
earlier filed with the Court of Appeals. It is only before this Court that NPC now
vigorously assails the preservation of Pobre's claim for damages. Clearly, NPC's
opposition to the existence of Pobre's claim for damages is a mere afterthought.
Rules of fair play, justice and due process dictate that parties cannot raise an issue
for the first time on appeal.13
We must correct NPC's claim that it filed the notice of dismissal just "shortly" after
it had filed the complaint for expropriation. While NPC had intimated several times
to the trial court its desire to dismiss the expropriation case it filed on 5 September
1979,14 it was only on 2 January 1985 that NPC filed its notice of dismissal. 15 It
took NPC more than five years to actually file the notice of dismissal. Five years is
definitely not a short period of time. NPC obviously dilly-dallied in filing its notice of
dismissal while NPC meanwhile burdened Pobre's property rights.
Even a timely opposition against Pobre's claim for damages would not yield a
favorable ruling for NPC. It is not Section 1, Rule 17 of the 1964 Rules of Court
that is applicable to this case but Rule 67 of the same Rules, as well as
jurisprudence on expropriation cases. Rule 17 referred to dismissal of civil actions
in general while Rule 67 specifically governed eminent domain cases.
Eminent domain is the authority and right of the state, as sovereign, to take private
property for public use upon observance of due process of law and payment of just
compensation.16 The power of eminent domain may be validly delegated to the
local governments, other public entities and public utilities17 such as NPC.
Expropriation is the procedure for enforcing the right of eminent
domain.18 "Eminent Domain" was the former title of Rule 67 of the 1964 Rules of
Court. In the 1997 Rules of Civil Procedure, which took effect on 1 July 1997, the
prescribed method of expropriation is still found in Rule 67, but its title is now
"Expropriation."
Section 1, Rule 17 of the 1964 Rules of Court provided the exception to the
general rule that the dismissal of the complaint is addressed to the sound
discretion of the court.19 For as long as all of the elements of Section 1, Rule 17
were present the dismissal of the complaint rested exclusively on the plaintiff's
will.20 The defending party and even the courts were powerless to prevent the
dismissal.21 The courts could only accept and record the dismissal.22
A plain reading of Section 1, Rule 17 of the 1964 Rules of Court makes it obvious
that this rule was not intended to supplement Rule 67 of the same Rules. Section
1, Rule 17 of the 1964 Rules of Court, provided that:
SECTION 1. Dismissal by the plaintiff. — An action may be dismissed by
the plaintiff without order of court by filing a notice of dismissal at any time
before service of the answer or of a motion for summary judgment. Unless
otherwise stated in the notice, the dismissal is without prejudice, except
that a notice operates as an adjudication upon the merits when filed by a
plaintiff who has once dismissed in a competent court an action based on
or including the same claim. A class suit shall not be dismissed or
compromised without approval of the court.
While Section 1, Rule 17 spoke of the "service of answer or summary judgment,"
the Rules then did not require the filing of an answer or summary judgment in
eminent domain cases.23 In lieu of an answer, Section 3 of Rule 67 required the
defendant to file a single motion to dismiss where he should present all of his
objections and defenses to the taking of his property for the purpose specified in
the complaint.24 In short, in expropriation cases under Section 3 of Rule 67, the
motion to dismiss took the place of the answer.
The records show that Pobre had already filed and served on NPC his "motion to
dismiss/answer"25 even before NPC filed its own motion to dismiss. NPC filed its
notice of dismissal of the complaint on 2 January 1985. However, as early as 10
December 1984, Pobre had already filed with the trial court and served on NPC
his "motion to dismiss/answer." A certain Divina Cerela received Pobre's pleading
on behalf of NPC.26 Unfortunately for NPC, even Section 1, Rule 17 of the 1964
Rules of Court could not save its cause.
NPC is in no position to invoke Section 1, Rule 17 of the 1964 Rules of Court. A
plaintiff loses his right under this rule to move for the immediate dismissal of the
complaint once the defendant had served on the plaintiff the answer or a motion
for summary judgment before the plaintiff could file his notice of dismissal of the
complaint.27 Pobre's "motion to dismiss/answer," filed and served way ahead of
NPC's motion to dismiss, takes the case out of Section 1, Rule 17 assuming the
same applies.
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In expropriation cases, there is no such thing as the plaintiff's matter of right to
dismiss the complaint precisely because the landowner may have already suffered
damages at the start of the taking. The plaintiff's right in expropriation cases to
dismiss the complaint has always been subject to court approval and to certain
conditions.28The exceptional right that Section 1, Rule 17 of the 1964 Rules of
Court conferred on the plaintiff must be understood to have applied only to other
civil actions. The 1997 Rules of Civil Procedure abrogated this exceptional right. 29
The power of eminent domain is subject to limitations. A landowner cannot be
deprived of his right over his land until expropriation proceedings are instituted in
court.30 The court must then see to it that the taking is for public use, there is
payment of just compensation and there is due process of law. 31
If the propriety of the taking of private property through eminent domain is subject
to judicial scrutiny, the dismissal of the complaint must also pass judicial inquiry
because private rights may have suffered in the meantime. The dismissal,
withdrawal or abandonment of the expropriation case cannot be made arbitrarily. If
it appears to the court that the expropriation is not for some public use,32 then it
becomes the duty of the court to dismiss the action.33However, when the
defendant claims that his land suffered damage because of the expropriation, the
dismissal of the action should not foreclose the defendant's right to have his
damages ascertained either in the same case or in a separate action. 34
Thus, NPC's theory that the dismissal of its complaint carried with it the dismissal
of Pobre's claim for damages is baseless. There is nothing in Rule 67 of the 1964
Rules of Court that provided for the dismissal of the defendant's claim for
damages, upon the dismissal of the expropriation case. Case law holds that in the
event of dismissal of the expropriation case, the claim for damages may be made
either in a separate or in the same action, for all damages occasioned by the
institution of the expropriation case.35 The dismissal of the complaint can be made
under certain conditions, such as the reservation of the defendant's right to recover
damages either in the same or in another action.36 The trial court in this case
reserved Pobre's right to prove his claim in the same case, a reservation that has
become final due to NPC's own fault.
Factual Findings of the Trial and Appellate Courts Bind the Court
The trial and appellate courts held that even before the first expropriation case,
Pobre had already established his Property as a resort-subdivision. NPC had
wrought so much damage to the Property that NPC had made the Property
uninhabitable as a resort-subdivision. NPC's facilities such as steam wells, nag
wells, power plants, power lines, and canals had hemmed in Pobre's Property.
NPC's operations of its geothermal project also posed a risk to lives and
properties.
We uphold the factual findings of the trial and appellate courts. Questions of facts
are beyond the pale of Rule 45 of the Rules of Court as a petition for review may
only raise questions of law.37 Moreover, factual findings of the trial court,
particularly when affirmed by the Court of Appeals, are generally binding on this
Court.38 We thus find no reason to set aside the two courts' factual findings.
NPC points out that it did not take Pobre's 68,969 square-meter Property. NPC
argues that assuming that it is liable for damages, the 8,311.60 square-meter
portion that it had successfully expropriated and fully paid for should have been
excluded from the 68,969 square-meter Property that Pobre claims NPC had
damaged.
We are not persuaded.
In its 30 October 1987 Order denying NPC's motion for reconsideration, the trial
court pointed out that the Property originally had a total area of 141,300 square
meters.39 Pobre converted the Property into a resort-subdivision and sold lots to
the public. What remained of the lots are the 68,969 square meters of
land.40 Pobre no longer claimed damages for the other lots that he had before the
expropriation.
Pobre identified in court the lots forming the 68,969 square-meter Property. NPC
had the opportunity to object to the identification of the lots.41 NPC, however, failed
to do so. Thus, we do not disturb the trial and appellate courts' finding on the total
land area NPC had damaged.
NPC must Pay Just Compensation for the Entire Property
Ordinarily, the dismissal of the expropriation case restores possession of the
expropriated land to the landowner.42However, when possession of the land
cannot be turned over to the landowner because it is neither convenient nor
feasible anymore to do so, the only remedy available to the aggrieved landowner is
to demand payment of just compensation.43
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In this case, we agree with the trial and appellate courts that it is no longer
possible and practical to restore possession of the Property to Pobre. The Property
is no longer habitable as a resort-subdivision. The Property is worthless to Pobre
and is now useful only to NPC. Pobre has completely lost the Property as if NPC
had physically taken over the entire 68,969 square-meter Property.
In United States v. Causby,44 the U.S. Supreme Court ruled that when private
property is rendered uninhabitable by an entity with the power to exercise eminent
domain, the taking is deemed complete. Such taking is thus compensable.
In this jurisdiction, the Court has ruled that if the government takes property
without expropriation and devotes the property to public use, after many years the
property owner may demand payment of just compensation.45 This principle is in
accord with the constitutional mandate that private property shall not be taken for
public use without just compensation.46
In the recent case of National Housing Authority v. Heirs of Isidro
Guivelondo,47 the Court compelled the National Housing Authority ("NHA") to pay
just compensation to the landowners even after the NHA had already abandoned
the expropriation case. The Court pointed out that a government agency could not
initiate expropriation proceedings, seize a person's property, and then just decide
not to proceed with the expropriation. Such a complete turn-around is arbitrary and
capricious and was condemned by the Court in the strongest possible terms. NHA
was held liable to the landowners for the prejudice that they had suffered.
In this case, NPC appropriated Pobre's Property without resort to expropriation
proceedings. NPC dismissed its own complaint for the second expropriation. At no
point did NPC institute expropriation proceedings for the lots outside the 5,554
square-meter portion subject of the second expropriation. The only issues that the
trial court had to settle were the amount of just compensation and damages that
NPC had to pay Pobre.
This case ceased to be an action for expropriation when NPC dismissed its
complaint for expropriation. Since this case has been reduced to a simple case of
recovery of damages, the provisions of the Rules of Court on the ascertainment of
the just compensation to be paid were no longer applicable. A trial before
commissioners, for instance, was dispensable.
We have held that the usual procedure in the determination of just compensation is
waived when the government itself initially violates procedural
requirements.48 NPC's taking of Pobre's property without filing the appropriate
expropriation proceedings and paying him just compensation is a transgression of
procedural due process.
From the beginning, NPC should have initiated expropriation proceedings for
Pobre's entire 68,969 square-meter Property. NPC did not. Instead, NPC
embarked on a piecemeal expropriation of the Property. Even as the second
expropriation case was still pending, NPC was well aware of the damage that it
had unleashed on the entire Property. NPC, however, remained impervious to
Pobre's repeated demands for NPC to abate the damage that it had wrought on
his Property.
NPC moved for the dismissal of the complaint for the second expropriation on the
ground that it had found an alternative site and there was stiff opposition from
Pobre.49 NPC abandoned the second expropriation case five years after it had
already deprived the Property virtually of all its value. NPC has demonstrated its
utter disregard for Pobre's property rights.
Thus, it would now be futile to compel NPC to institute expropriation proceedings
to determine the just compensation for Pobre's 68,969 square-meter Property.
Pobre must be spared any further delay in his pursuit to receive just compensation
from NPC.
Just compensation is the fair and full equivalent of the loss.50 The trial and
appellate courts endeavored to meet this standard. The P50 per square meter
valuation of the 68,969 square-meter Property is reasonable considering that the
Property was already an established resort-subdivision. NPC has itself to blame for
not contesting the valuation before the trial court. Based on the P50 per square
meter valuation, the total amount of just compensation that NPC must pay Pobre
is P3,448,450.
The landowner is entitled to legal interest on the price of the land from the time of
the taking up to the time of full payment by the government.51 In accord with
jurisprudence, we fix the legal interest at six per cent (6%) per annum. 52 The legal
interest should accrue from 6 September 1979, the date when the trial court issued
the writ of possession to NPC, up to the time that NPC fully pays Pobre. 53
NPC's abuse of its eminent domain authority is appalling. However, we cannot
award moral damages because Pobre did not assert his right to it.54 We also
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cannot award attorney's fees in Pobre's favor since he did not appeal from the
decision of the Court of Appeals denying recovery of attorney's fees. 55
Nonetheless, we find it proper to award P50,000 in temperate damages to Pobre.
The court may award temperate or moderate damages, which are more than
nominal but less than compensatory damages, if the court finds that a party has
suffered some pecuniary loss but its amount cannot be proved with certainty from
the nature of the case.56As the trial and appellate courts noted, Pobre's resort-
subdivision was no longer just a dream because Pobre had already established
the resort-subdivision and the prospect for it was initially encouraging. That is, until
NPC permanently damaged Pobre's Property. NPC did not just destroy the
property. NPC dashed Pobre's hope of seeing his Property achieve its full potential
as a resort-subdivision.
The lesson in this case must not be lost on entities with eminent domain authority.
Such entities cannot trifle with a citizen's property rights. The power of eminent
domain is an extraordinary power they must wield with circumspection and utmost
regard for procedural requirements. Thus, we hold NPC liable for exemplary
damages of P100,000. Exemplary damages or corrective damages are imposed,
by way of example or correction for the public good, in addition to the moral,
temperate, liquidated or compensatory damages.57
WHEREFORE, we DENY the petition for lack of merit. The appealed Decision of
the Court of Appeals dated 30 March 1992 in CA-G.R. CV No. 16930 is
AFFIRMED with MODIFICATION. National Power Corporation is ordered to pay
Antonino Pobre P3,448,450 as just compensation for the 68,969 square-meter
Property at P50 per square meter. National Power Corporation is directed to pay
legal interest at 6% per annum on the amount adjudged from 6 September 1979
until fully paid. Upon National Power Corporation's payment of the full amount,
Antonino Pobre is ordered to execute a Deed of Conveyance of the Property in
National Power Corporation's favor. National Power Corporation is further ordered
to pay temperate and exemplary damages of P50,000 and P100,000, respectively.
No costs.
SO ORDERED.
G.R. No. 160656 June 15, 2007
REPUBLIC OF THE PHILIPPINES (Department of Public Works and
Highways), petitioner,
vs.
ISMAEL ANDAYA, respondent.
DECISION
QUISUMBING, J.:
This is a petition for review of the Decision1 dated October 30, 2003 of the Court of
Appeals in CA-G.R. CV No. 65066 affirming with modification the Decision2 of the
Regional Trial Court of Butuan City, Branch 33 in Civil Case No. 4378, for
enforcement of easement of right-of-way (or eminent domain).
Respondent Ismael Andaya is the registered owner of two parcels of land in
Bading, Butuan City. His ownership is evidenced by Transfer Certificates of Title
Nos. RT-10225 and RT-10646. These properties are subject to a 60-meter wide
perpetual easement for public highways, irrigation ditches, aqueducts, and other
similar works of the government or public enterprise, at no cost to the government,
except only the value of the improvements existing thereon that may be affected.
Petitioner Republic of the Philippines (Republic) negotiated with Andaya to enforce
the 60-meter easement of right-of-way. The easement was for concrete levees and
floodwalls for Phase 1, Stage 1 of the Lower Agusan Development Project. The
parties, however, failed to reach an agreement.
On December 13, 1995, the Republic instituted an action before the Regional Trial
Court of Butuan City to enforce the easement of right-of-way or eminent domain.
The trial court issued a writ of possession on April 26, 1996.3 It also constituted a
Board of Commissioners (Board) to determine the just compensation. Eventually,
the trial court issued an Order of Expropriation upon payment of just
compensation.4 Later, the Board reported that there was a discrepancy in the
description of the property sought to be expropriated. The Republic thus amended
its complaint, reducing the 60-meter easement to 10 meters, or an equivalent of
701 square meters.
On December 10, 1998, the Board reported that the project would affect a total of
10,380 square meters of Andaya’s properties, 4,443 square meters of which will be
for the 60-meter easement. The Board also reported that the easement would
diminish the value of the remaining 5,937 square meters. As a result, it
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recommended the payment of consequential damages amounting to ₱2,820,430
for the remaining area.5
Andaya objected to the report because although the Republic reduced the
easement to 10 meters or an equivalent of 701 square meters, the Board still
granted it 4,443 square meters. He contended that the consequential damages
should be based on the remaining area of 9,679 square meters. Thus, the just
compensation should be ₱11,373,405. The Republic did not file any comment,
opposition, nor objection.
After considering the Board’s report, the trial court decreed on April 29, 1999, as
follows:
WHEREFORE, in the light of the foregoing, the Court decides as follows:
a) That the plaintiff is legally entitled to its inherent right of expropriation to, viz.: 1)
the lot now known as lot 3291-B-1-A, portion of lot 3291-B-1, (LRC) Psd-255693,
covered by TCT No. RT-10225, with an area of 288 sq. m.; and 2) the lot now
known as lot 3293-F-5-B-1, portion of lot 3293-F-5-B (LRC) Psd-230236, covered
by TCT No. RT-10646, with an area of 413 sq. m., both of the Butuan City Registry
of Deeds, it being shown that it is for public use and purpose --- free of charge by
reason of the statutory lien of easement of right-of-way imposed on defendant’s
titles;
b) That however, the plaintiff is obligated to pay defendant the sum of TWO
MILLION EIGHT HUNDRED TWENTY THOUSAND FOUR HUNDRED THIRTY
(P2,820,430.00) PESOS as fair and reasonable severance damages;
c) To pay members of the Board of Commissioners, thus: for the chairman ---
TWENTY THOUSAND (P20,000.00) PESOS and the two (2) members at
FIFTEEN THOUSAND (P15,000.00) PESOS each;
d) To pay defendant’s counsel FIFTY THOUSAND (P50,000.00) PESOS as
Attorney’s fees; and finally,
e) That the Registry of Deeds of Butuan City is also directed to effect the issuance
of Transfer Certificate of Titles for the aforementioned two (2) lots in the name of
the Republic of the Philippines, following the technical description as appearing in
pages 6, 7, and 8 of the Commissioner’s Report.
NO COSTS.
IT IS SO ORDERED.6
Both parties appealed to the Court of Appeals. The Republic contested the awards
of severance damages and attorney’s fees while Andaya demanded just
compensation for his entire property minus the easement. Andaya alleged that the
easement would prevent ingress and egress to his property and turn it into a catch
basin for the floodwaters coming from the Agusan River. As a result, his entire
property would be rendered unusable and uninhabitable. He thus demanded
₱11,373,405 as just compensation based on the total compensable area of 9,679
square meters.
The Court of Appeals modified the trial court’s decision by imposing a 6% interest
on the consequential damages from the date of the writ of possession or the actual
taking, and by deleting the attorney’s fees.
Hence, the instant petition. Simply put, the sole issue for resolution may be stated
thus: Is the Republic liable for just compensation if in enforcing the legal easement
of right-of-way on a property, the remaining area would be rendered unusable and
uninhabitable?
It is undisputed that there is a legal easement of right-of-way in favor of the
Republic. Andaya’s transfer certificates of title7 contained the reservation that the
lands covered thereby are subject to the provisions of the Land Registration
Act8 and the Public Land Act.9 Section 11210 of the Public Land Act provides that
lands granted by patent shall be subject to a right-of-way not exceeding 60 meters
in width for public highways, irrigation ditches, aqueducts, and other similar works
of the government or any public enterprise, free of charge, except only for the
value of the improvements existing thereon that may be affected. In view of this,
the Court of Appeals declared that all the Republic needs to do is to enforce such
right without having to initiate expropriation proceedings and without having to pay
any just compensation.11 Hence, the Republic may appropriate the 701 square
meters necessary for the construction of the floodwalls without paying for it.
We are, however, unable to sustain the Republic’s argument that it is not liable to
pay consequential damages if in enforcing the legal easement on Andaya’s
property, the remaining area would be rendered unusable and uninhabitable.
"Taking," in the exercise of the power of eminent domain, occurs not only when the
government actually deprives or dispossesses the property owner of his property
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or of its ordinary use, but also when there is a practical destruction or material
impairment of the value of his property.12 Using this standard, there was
undoubtedly a taking of the remaining area of Andaya’s property. True, no burden
was imposed thereon and Andaya still retained title and possession of the
property. But, as correctly observed by the Board and affirmed by the courts a quo,
the nature and the effect of the floodwalls would deprive Andaya of the normal use
of the remaining areas. It would prevent ingress and egress to the property and
turn it into a catch basin for the floodwaters coming from the Agusan River.
Butuan City, Branch 33 in Civil Case No. 4378, is AFFIRMED with
MODIFICATION as herein set forth.
The case is hereby REMANDED to the Regional Trial Court of Butuan City,
Branch 33 for the determination of the final just compensation of the compensable
area consisting of 5,937 square meters, with interest thereon at the legal rate of
6% per annum from the date of the writ of possession or actual taking until fully
paid.

For this reason, in our view, Andaya is entitled to payment of just compensation, No pronouncement as to costs.
which must be neither more nor less than the monetary equivalent of the
land.13 One of the basic principles enshrined in our Constitution is that no person
SO ORDERED.
shall be deprived of his private property without due process of law; and in
expropriation cases, an essential element of due process is that there must be just
compensation whenever private property is taken for public use. Noteworthy,
Section 9, Article III of our Constitution mandates that private property shall not be
taken for public use without just compensation.14
G.R. No. 169914 April 18, 2008
Finally, we affirm the findings of the Court of Appeals and the trial court that just
compensation should be paid only for 5,937 square meters of the total area of ASIA'S EMERGING DRAGON CORPORATION, petitioner,
10,380 square meters. Admittedly, the Republic needs only a 10-meter easement vs.
or an equivalent of 701 square meters. Yet, it is also settled that it is legally entitled DEPARTMENT OF TRANSPORTATION AND COMMUNICATIONS,
to a 60-meter wide easement or an equivalent of 4,443 square meters. Clearly, SECRETARY LEANDRO R. MENDOZA and MANILA INTERNATIONAL
although the Republic will use only 701 square meters, it should not be liable for AIRPORT AUTHORITY, respondents.
the 3,742 square meters, which constitute the difference between this area of 701
square meters and the 4,443 square meters to which it is fully entitled to use as x ----------------------------------------- x
easement, free of charge except for damages to affected existing improvements, if
any, under Section 112 of the Public Land Act.
G.R. No. 174166 April 18, 2008

In effect, without such damages alleged and proved, the Republic is liable for just
REPUBLIC OF THE PHILIPPINES, represented by the DEPARTMENT OF
compensation of only the remaining areas consisting of 5,937 square meters, with
TRANSPORTATION AND COMMUNICATIONS and MANILA INTERNATIONAL
interest thereon at the legal rate of 6% per annum from the date of the writ of
AIRPORT AUTHORITY, petitioner,
possession or the actual taking until full payment is made. For the purpose of
vs.
determining the final just compensation, the case is remanded to the trial court.
HON. COURT OF APPEALS and SALACNIB BATERINA, respondents.
Said court is ordered to make the determination of just compensation payable to
respondent Andaya with deliberate dispatch.
DECISION
WHEREFORE, the Decision of the Court of Appeals dated October 30, 2003 in
CA-G.R. CV No. 65066, modifying the Decision of the Regional Trial Court of CHICO-NAZARIO, J.:

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This Court is still continuously besieged by Petitions arising from the awarding of
the Ninoy Aquino International Airport International Passenger Terminal III (NAIA
IPT III) Project to the Philippine International Air Terminals Co., Inc. (PIATCO),
despite the promulgation by this Court of Decisions and Resolutions in two
cases, Agan, Jr. v. Philippine International Air Terminals Co., Inc.1 and Republic v.
Gingoyon,2 which already resolved the more basic and immediate issues arising
from the said award. The sheer magnitude of the project, the substantial cost of its
building, the expected high profits from its operations, and its remarkable impact
on the Philippine economy, consequently raised significant interest in the project
from various quarters.
Once more, two new Petitions concerning the NAIA IPT III Project are before this
Court. It is only appropriate, however, that the Court first recounts its factual and
legal findings in Agan and Gingoyon to ascertain that its ruling in the Petitions at
bar shall be consistent and in accordance therewith.
Agan, Jr. v. Philippine International Air Terminals Co., Inc. (G.R. Nos. 155001,
155547, and 155661)
Already established and incontrovertible are the following facts in Agan:
In August 1989, the [Department of Trade and Communications (DOTC)]
engaged the services of Aeroport de Paris (ADP) to conduct a
comprehensive study of the Ninoy Aquino International Airport (NAIA) and
determine whether the present airport can cope with the traffic
development up to the year 2010. The study consisted of two parts: first,
traffic forecasts, capacity of existing facilities, NAIA future requirements,
proposed master plans and development plans; and second, presentation
of the preliminary design of the passenger terminal building. The ADP
submitted a Draft Final Report to the DOTC in December 1989.
Some time in 1993, six business leaders consisting of John Gokongwei,
Andrew Gotianun, Henry Sy, Sr., Lucio Tan, George Ty and Alfonso
Yuchengco met with then President Fidel V. Ramos to explore the
possibility of investing in the construction and operation of a new
international airport terminal. To signify their commitment to pursue the
project, they formed the Asia's Emerging Dragon Corp. (AEDC) which was
registered with the Securities and Exchange Commission (SEC) on
September 15, 1993.
On October 5, 1994, AEDC submitted an unsolicited proposal to the
Government through the DOTC/[Manila International Airport Authority
(MIAA)] for the development of NAIA International Passenger Terminal III
(NAIA IPT III) under a build-operate-and-transfer arrangement pursuant to
RA 6957 as amended by RA 7718 (BOT Law).
On December 2, 1994, the DOTC issued Dept. Order No. 94-832
constituting the Prequalification Bids and Awards Committee (PBAC) for
the implementation of the NAIA IPT III project.
On March 27, 1995, then DOTC Secretary Jose Garcia endorsed the
proposal of AEDC to the National Economic and Development Authority
(NEDA). A revised proposal, however, was forwarded by the DOTC to
NEDA on December 13, 1995. On January 5, 1996, the NEDA Investment
Coordinating Council (NEDA ICC) - Technical Board favorably endorsed
the project to the ICC - Cabinet Committee which approved the same,
subject to certain conditions, on January 19, 1996. On February 13, 1996,
the NEDA passed Board Resolution No. 2 which approved the NAIA IPT III
project.
On June 7, 14, and 21, 1996, DOTC/MIAA caused the publication in two
daily newspapers of an invitation for competitive or comparative proposals
on AEDC's unsolicited proposal, in accordance with Sec. 4-A of RA 6957,
as amended. The alternative bidders were required to submit three (3)
sealed envelopes on or before 5:00 p.m. of September 20, 1996. The first
envelope should contain the Prequalification Documents, the second
envelope the Technical Proposal, and the third envelope the Financial
Proposal of the proponent.
On June 20, 1996, PBAC Bulletin No. 1 was issued, postponing the
availment of the Bid Documents and the submission of the comparative
bid proposals. Interested firms were permitted to obtain the Request for
Proposal Documents beginning June 28, 1996, upon submission of a
written application and payment of a non-refundable fee of P50,000.00
(US$2,000).
The Bid Documents issued by the PBAC provided among others that the
proponent must have adequate capability to sustain the financing
requirement for the detailed engineering, design, construction, operation,
and maintenance phases of the project. The proponent would be
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evaluated based on its ability to provide a minimum amount of equity to
the project, and its capacity to secure external financing for the project.
On July 23, 1996, the PBAC issued PBAC Bulletin No. 2 inviting all
bidders to a pre-bid conference on July 29, 1996.
On August 16, 1996, the PBAC issued PBAC Bulletin No. 3 amending the
Bid Documents. The following amendments were made on the Bid
Documents:
a. Aside from the fixed Annual Guaranteed Payment, the
proponent shall include in its financial proposal an additional
percentage of gross revenue share of the Government, as follows:
i. First 5 years 5.0%
ii. Next 10 years 7.5%
iii. Next 10 years 10.0%
b. The amount of the fixed Annual Guaranteed Payment shall be
subject of the price challenge. Proponent may offer an Annual
Guaranteed Payment which need not be of equal amount, but
payment of which shall start upon site possession.
c. The project proponent must have adequate capability to sustain
the financing requirement for the detailed engineering, design,
construction, and/or operation and maintenance phases of the
project as the case may be. For purposes of pre-qualification, this
capability shall be measured in terms of:
i. Proof of the availability of the project proponent and/or
the consortium to provide the minimum amount of equity
for the project; and
ii. a letter testimonial from reputable banks attesting that
the project proponent and/or the members of the
consortium are banking with them, that the project
proponent and/or the members are of good financial
standing, and have adequate resources.
d. The basis for the prequalification shall be the proponent's
compliance with the minimum technical and financial requirements
provided in the Bid Documents and the [Implementing Rules and
Regulations (IRR)] of the BOT Law. The minimum amount of
equity shall be 30% of the Project Cost.
e. Amendments to the draft Concession Agreement shall be
issued from time to time. Said amendments shall only cover items
that would not materially affect the preparation of the proponent's
proposal.
On August 29, 1996, the Second Pre-Bid Conference was held where
certain clarifications were made. Upon the request of prospective bidder
People's Air Cargo & Warehousing Co., Inc (Paircargo), the PBAC
warranted that based on Sec. 11.6, Rule 11 of the Implementing Rules
and Regulations of the BOT Law, only the proposed Annual Guaranteed
Payment submitted by the challengers would be revealed to AEDC, and
that the challengers' technical and financial proposals would remain
confidential. The PBAC also clarified that the list of revenue sources
contained in Annex 4.2a of the Bid Documents was merely indicative and
that other revenue sources may be included by the proponent, subject to
approval by DOTC/MIAA. Furthermore, the PBAC clarified that only those
fees and charges denominated as Public Utility Fees would be subject to
regulation, and those charges which would be actually deemed Public
Utility Fees could still be revised, depending on the outcome of PBAC's
query on the matter with the Department of Justice.
In September 1996, the PBAC issued Bid Bulletin No. 5, entitled "Answers
to the Queries of PAIRCARGO as Per Letter Dated September 3 and 10,
1996." Paircargo's queries and the PBAC's responses were as follows:
1. It is difficult for Paircargo and Associates to meet the required
minimum equity requirement as prescribed in Section 8.3.4 of the
Bid Documents considering that the capitalization of each member
company is so structured to meet the requirements and needs of
their current respective business undertaking/activities. In order to
comply with this equity requirement, Paircargo is requesting PBAC
to just allow each member of (sic) corporation of the Joint Venture
to just execute an agreement that embodies a commitment to
infuse the required capital in case the project is awarded to the
Page 357 of 507
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 Joint Venture instead of increasing each corporation's current
authorized capital stock just for prequalification purposes.
In prequalification, the agency is interested in one's financial
capability at the time of prequalification, not future or potential
capability.
A commitment to put up equity once awarded the project is not
enough to establish that "present" financial capability. However,
total financial capability of all member companies of the
Consortium, to be established by submitting the respective
companies' audited financial statements, shall be acceptable.
2. At present, Paircargo is negotiating with banks and other
institutions for the extension of a Performance Security to the joint
venture in the event that the Concessions Agreement (sic) is
awarded to them. However, Paircargo is being required to submit
a copy of the draft concession as one of the documentary
requirements. Therefore, Paircargo is requesting that they'd (sic)
be furnished copy of the approved negotiated agreement between
the PBAC and the AEDC at the soonest possible time.
A copy of the draft Concession Agreement is included in the Bid
Documents. Any material changes would be made known to
prospective challengers through bid bulletins. However, a final
version will be issued before the award of contract.
The PBAC also stated that it would require AEDC to sign Supplement C of
the Bid Documents (Acceptance of Criteria and Waiver of Rights to Enjoin
Project) and to submit the same with the required Bid Security.
On September 20, 1996, the consortium composed of People's Air Cargo
and Warehousing Co., Inc. (Paircargo), Phil. Air and Grounds Services,
Inc. (PAGS) and Security Bank Corp. (Security Bank) (collectively,
Paircargo Consortium) submitted their competitive proposal to the PBAC.
On September 23, 1996, the PBAC opened the first envelope containing
the prequalification documents of the Paircargo Consortium. On the
following day, September 24, 1996, the PBAC prequalified the Paircargo
Consortium.
On September 26, 1996, AEDC informed the PBAC in writing of its
reservations as regards the Paircargo Consortium, which include:
a. The lack of corporate approvals and financial capability of
PAIRCARGO;
b. The lack of corporate approvals and financial capability of
PAGS;
c. The prohibition imposed by RA 337, as amended (the General
Banking Act) on the amount that Security Bank could legally invest
in the project;
d. The inclusion of Siemens as a contractor of the PAIRCARGO
Joint Venture, for prequalification purposes; and
e. The appointment of Lufthansa as the facility operator, in view of
the Philippine requirement in the operation of a public utility.
The PBAC gave its reply on October 2, 1996, informing AEDC that it had
considered the issues raised by the latter, and that based on the
documents submitted by Paircargo and the established prequalification
criteria, the PBAC had found that the challenger, Paircargo, had
prequalified to undertake the project. The Secretary of the DOTC
approved the finding of the PBAC.
The PBAC then proceeded with the opening of the second envelope of the
Paircargo Consortium which contained its Technical Proposal.
On October 3, 1996, AEDC reiterated its objections, particularly with
respect to Paircargo's financial capability, in view of the restrictions
imposed by Section 21-B of the General Banking Act and Sections 1380
and 1381 of the Manual Regulations for Banks and Other Financial
Intermediaries. On October 7, 1996, AEDC again manifested its objections
and requested that it be furnished with excerpts of the PBAC meeting and
the accompanying technical evaluation report where each of the issues
they raised were addressed.
Page 358 of 507
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On October 16, 1996, the PBAC opened the third envelope submitted by
AEDC and the Paircargo Consortium containing their respective financial
proposals. Both proponents offered to build the NAIA Passenger Terminal
III for at least $350 million at no cost to the government and to pay the
government: 5% share in gross revenues for the first five years of
operation, 7.5% share in gross revenues for the next ten years of
operation, and 10% share in gross revenues for the last ten years of
operation, in accordance with the Bid Documents. However, in addition to
the foregoing, AEDC offered to pay the government a total of P135 million
as guaranteed payment for 27 years while Paircargo Consortium offered to
pay the government a total of P17.75 billion for the same period.
Thus, the PBAC formally informed AEDC that it had accepted the price
proposal submitted by the Paircargo Consortium, and gave AEDC 30
working days or until November 28, 1996 within which to match the said
bid, otherwise, the project would be awarded to Paircargo.
As AEDC failed to match the proposal within the 30-day period, then
DOTC Secretary Amado Lagdameo, on December 11, 1996, issued a
notice to Paircargo Consortium regarding AEDC's failure to match the
proposal.
On February 27, 1997, Paircargo Consortium incorporated into Philippine
International Airport Terminals Co., Inc. (PIATCO).
AEDC subsequently protested the alleged undue preference given to
PIATCO and reiterated its objections as regards the prequalification of
PIATCO.
On April 11, 1997, the DOTC submitted the concession agreement for the
second-pass approval of the NEDA-ICC.
On April 16, 1997, AEDC filed with the Regional Trial Court of Pasig a
Petition for Declaration of Nullity of the Proceedings, Mandamus and
Injunction against the Secretary of the DOTC, the Chairman of the PBAC,
the voting members of the PBAC and Pantaleon D. Alvarez, in his capacity
as Chairman of the PBAC Technical Committee.
xxxx
On July 9, 1997, the DOTC issued the notice of award for the project to
PIATCO.
On July 12, 1997, the Government, through then DOTC Secretary Arturo
T. Enrile, and PIATCO, through its President, Henry T. Go, signed the
"Concession Agreement for the Build-Operate-and-Transfer Arrangement
of the Ninoy Aquino International Airport Passenger Terminal III" (1997
Concession Agreement). x x x.
On November 26, 1998, the Government and PIATCO signed an
Amended and Restated Concession Agreement (ARCA). x x x.
Subsequently, the Government and PIATCO signed three Supplements to
the ARCA. The First Supplement was signed on August 27, 1999; the
Second Supplement on September 4, 2000; and the Third Supplement on
June 22, 2001 (collectively, Supplements).
xxxx
Meanwhile, the MIAA which is charged with the maintenance and
operation of the NAIA Terminals I and II, had existing concession contracts
with various service providers to offer international airline airport services,
such as in-flight catering, passenger handling, ramp and ground support,
aircraft maintenance and provisions, cargo handling and warehousing, and
other services, to several international airlines at the NAIA. x x x.
On September 17, 2002, the workers of the international airline service
providers, claiming that they stand to lose their employment upon the
implementation of the questioned agreements, filed before this Court a
petition for prohibition to enjoin the enforcement of said agreements.
On October 15, 2002, the service providers, joining the cause of the
petitioning workers, filed a motion for intervention and a petition-in-
intervention.
On October 24, 2002, Congressmen Salacnib Baterina, Clavel Martinez
and Constantino Jaraula filed a similar petition with this Court.
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 On November 6, 2002, several employees of the MIAA likewise filed a
petition assailing the legality of the various agreements.
On December 11, 2002, another group of Congressmen, Hon. Jacinto V.
Paras, Rafael P. Nantes, Eduardo C. Zialcita, Willie B. Villarama, Prospero
C. Nograles, Prospero A. Pichay, Jr., Harlin Cast Abayon and Benasing O.
Macaranbon, moved to intervene in the case as Respondents-Intervenors.
They filed their Comment-In-Intervention defending the validity of the
assailed agreements and praying for the dismissal of the petitions.
During the pendency of the case before this Court, President Gloria
Macapagal Arroyo, on November 29, 2002, in her speech at the 2002
Golden Shell Export Awards at Malacañang Palace, stated that she will
not "honor (PIATCO) contracts which the Executive Branch's legal offices
have concluded (as) null and void."3
The Court first dispensed with the procedural issues raised in Agan, ruling that (a)
the MIAA service providers and its employees, petitioners in G.R. Nos. 155001
and 155661, had the requisite standing since they had a direct and substantial
interest to protect by reason of the implementation of the PIATCO Contracts which
would affect their source of livelihood;4 and (b) the members of the House of
Representatives, petitioners in G.R. No. 155547, were granted standing in view of
the serious legal questions involved and their impact on public interest. 5
As to the merits of the Petitions in Agan, the Court concluded that:
In sum, this Court rules that in view of the absence of the requisite
financial capacity of the Paircargo Consortium, predecessor of respondent
PIATCO, the award by the PBAC of the contract for the construction,
operation and maintenance of the NAIA IPT III is null and void. Further,
considering that the 1997 Concession Agreement contains material and
substantial amendments, which amendments had the effect of converting
the 1997 Concession Agreement into an entirely different agreement from
the contract bidded upon, the 1997 Concession Agreement is similarly null
and void for being contrary to public policy. The provisions under Sections
4.04(b) and (c) in relation to Section 1.06 of the 1997 Concession
Agreement and Section 4.04(c) in relation to Section 1.06 of the ARCA,
which constitute a direct government guarantee expressly prohibited by,
among others, the BOT Law and its Implementing Rules and Regulations
are also null and void. The Supplements, being accessory contracts to the
ARCA, are likewise null and void.6
Hence, the fallo of the Court's Decision in Agan reads:
WHEREFORE, the 1997 Concession Agreement, the Amended and
Restated Concession Agreement and the Supplements thereto are set
aside for being null and void.7
In a Resolution8 dated 21 January 2004, the Court denied with finality the Motions
for Reconsideration of its 5 May 2003 Decision in Agan filed by therein
respondents PIATCO and Congressmen Paras, et al., and respondents-
intervenors.9 Significantly, the Court declared in the same Resolution that:
This Court, however, is not unmindful of the reality that the structures
comprising the NAIA IPT III facility are almost complete and that funds
have been spent by PIATCO in their construction. For the government to
take over the said facility, it has to compensate respondent PIATCO as
builder of the said structures. The compensation must be just and in
accordance with law and equity for the government can not unjustly
enrich itself at the expense of PIATCO and its investors.10 (Emphasis
ours.)
It is these afore-quoted pronouncements that gave rise to the Petition in Gingoyon.
Republic v. Gingoyon (G.R. No. 166429)
According to the statement of facts in Gingoyon:
After the promulgation of the rulings in Agan, the NAIA 3 facilities have
remained in the possession of PIATCO, despite the avowed intent of the
Government to put the airport terminal into immediate operation. The
Government and PIATCO conducted several rounds of negotiation
regarding the NAIA 3 facilities. It also appears that arbitral proceedings
were commenced before the International Chamber of Commerce
International Court of Arbitration and the International Centre for the
Settlement of Investment Disputes, although the Government has raised
jurisdictional questions before those two bodies.
Page 360 of 507
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Then, on 21 December 2004, the Government filed a Complaint for
expropriation with the Pasay City Regional Trial Court (RTC), together with
an Application for Special Raffle seeking the immediate holding of a
special raffle. The Government sought upon the filing of the complaint the
issuance of a writ of possession authorizing it to take immediate
possession and control over the NAIA 3 facilities. The Government also
declared that it had deposited the amount of P3,002,125,000.00 (3 Billion)
in Cash with the Land Bank of the Philippines, representing the NAIA 3
terminal's assessed value for taxation purposes.
The case was raffled to Branch 117 of the Pasay City RTC, presided by
respondent judge Hon. Henrick F. Gingoyon (Hon. Gingoyon). On the
same day that the Complaint was filed, the RTC issued an Order directing
the issuance of a writ of possession to the Government, authorizing it to
"take or enter upon the possession" of the NAIA 3 facilities. Citing the case
of City of Manila v. Serrano, the RTC noted that it had the ministerial duty
to issue the writ of possession upon the filing of a complaint for
expropriation sufficient in form and substance, and upon deposit made by
the government of the amount equivalent to the assessed value of the
property subject to expropriation. The RTC found these requisites present,
particularly noting that "[t]he case record shows that [the Government has]
deposited the assessed value of the [NAIA 3 facilities] in the Land Bank of
the Philippines, an authorized depositary, as shown by the certification
attached to their complaint." Also on the same day, the RTC issued a Writ
of Possession. According to PIATCO, the Government was able to take
possession over the NAIA 3 facilities immediately after the Writ of
Possession was issued.
However, on 4 January 2005, the RTC issued another Order designed to
supplement its 21 December 2004 Order and the Writ of Possession. In
the 4 January 2005 Order, now assailed in the present petition, the RTC
noted that its earlier issuance of its writ of possession was pursuant to
Section 2, Rule 67 of the 1997 Rules of Civil Procedure. However, it was
observed that Republic Act No. 8974 (Rep. Act No. 8974), otherwise
known as "An Act to Facilitate the Acquisition of Right-of-Way, Site or
Location for National Government Infrastructure Projects and For Other
Purposes" and its Implementing Rules and Regulations (Implementing
Rules) had amended Rule 67 in many respects.
There are at least two crucial differences between the respective
procedures under Rep. Act No. 8974 and Rule 67. Under the statute, the
Government is required to make immediate payment to the property owner
upon the filing of the complaint to be entitled to a writ of possession,
whereas in Rule 67, the Government is required only to make an initial
deposit with an authorized government depositary. Moreover, Rule 67
prescribes that the initial deposit be equivalent to the assessed value of
the property for purposes of taxation, unlike Rep. Act No. 8974 which
provides, as the relevant standard for initial compensation, the market
value of the property as stated in the tax declaration or the current relevant
zonal valuation of the Bureau of Internal Revenue (BIR), whichever is
higher, and the value of the improvements and/or structures using the
replacement cost method.
Accordingly, on the basis of Sections 4 and 7 of Rep. Act No. 8974 and
Section 10 of the Implementing Rules, the RTC made key qualifications to
its earlier issuances. First, it directed the Land Bank of the Philippines,
Baclaran Branch (LBP-Baclaran), to immediately release the amount of
US$62,343,175.77 to PIATCO, an amount which the RTC characterized
as that which the Government "specifically made available for the purpose
of this expropriation;" and such amount to be deducted from the amount of
just compensation due PIATCO as eventually determined by the
RTC. Second, the Government was directed to submit to the RTC a
Certificate of Availability of Funds signed by authorized officials to cover
the payment of just compensation. Third, the Government was directed "to
maintain, preserve and safeguard" the NAIA 3 facilities or "perform such
as acts or activities in preparation for their direct operation" of the airport
terminal, pending expropriation proceedings and full payment of just
compensation. However, the Government was prohibited "from performing
acts of ownership like awarding concessions or leasing any part of [NAIA
3] to other parties."
The very next day after the issuance of the assailed 4 January
2005 Order, the Government filed an Urgent Motion for Reconsideration,
which was set for hearing on 10 January 2005. On 7 January 2005, the
RTC issued another Order, the second now assailed before this Court,
which appointed three (3) Commissioners to ascertain the amount of just
compensation for the NAIA 3 Complex. That same day, the Government
filed a Motion for Inhibition of Hon. Gingoyon.
The RTC heard the Urgent Motion for Reconsideration and Motion for
Inhibition on 10 January 2005. On the same day, it denied these motions
in an Omnibus Order dated 10 January 2005. This is the third Order now
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 assailed before this Court. Nonetheless, while the Omnibus Order affirmed
the earlier dispositions in the 4 January 2005 Order, it excepted from
affirmance "the superfluous part of the Order prohibiting the plaintiffs from
awarding concessions or leasing any part of [NAIA 3] to other parties."
Thus, the present Petition for Certiorari and Prohibition under Rule 65 was
filed on 13 January 2005. The petition prayed for the nullification of the
RTC orders dated 4 January 2005, 7 January 2005, and 10 January 2005,
and for the inhibition of Hon. Gingoyon from taking further action on the
expropriation case. A concurrent prayer for the issuance of a temporary
restraining order and preliminary injunction was granted by this Court in
a Resolution dated 14 January 2005.11
The Court resolved the Petition of the Republic of the Philippines and Manila
International Airport Authority in Gingoyon in this wise:
In conclusion, the Court summarizes its rulings as follows:
(1) The 2004 Resolution in Agan sets the base requirement that has to be
observed before the Government may take over the NAIA 3, that there
must be payment to PIATCO of just compensation in accordance with law
and equity. Any ruling in the present expropriation case must be
conformable to the dictates of the Court as pronounced in the Agan cases.
(2) Rep. Act No. 8974 applies in this case, particularly insofar as it requires
the immediate payment by the Government of at least the proffered value
of the NAIA 3 facilities to PIATCO and provides certain valuation
standards or methods for the determination of just compensation.
(3) Applying Rep. Act No. 8974, the implementation of Writ of Possession
in favor of the Government over NAIA 3 is held in abeyance until PIATCO
is directly paid the amount of P3 Billion, representing the proffered value of
NAIA 3 under Section 4(c) of the law.
(4) Applying Rep. Act No. 8974, the Government is authorized to start the
implementation of the NAIA 3 Airport terminal project by performing the
acts that are essential to the operation of the NAIA 3 as an international
airport terminal upon the effectivity of the Writ of Possession, subject to
the conditions above-stated. As prescribed by the Court, such authority
encompasses "the repair, reconditioning and improvement of the complex,
maintenance of the existing facilities and equipment, installation of new
facilities and equipment, provision of services and facilities pertaining to
the facilitation of air traffic and transport, and other services that are
integral to a modern-day international airport."
5) The RTC is mandated to complete its determination of the just
compensation within sixty (60) days from finality of this Decision. In doing
so, the RTC is obliged to comply with the standards set under Rep. Act
No. 8974 and its Implementing Rules. Considering that the NAIA 3
consists of structures and improvements, the valuation thereof shall be
determined using the replacements cost method, as prescribed under
Section 10 of the Implementing Rules.
(6) There was no grave abuse of discretion attending the
RTC Order appointing the commissioners for the purpose of determining
just compensation. The provisions on commissioners under Rule 67 shall
apply insofar as they are not inconsistent with Rep. Act No. 8974, its
Implementing Rules, or the rulings of the Court in Agan.
(7) The Government shall pay the just compensation fixed in the decision
of the trial court to PIATCO immediately upon the finality of the said
decision.
(8) There is no basis for the Court to direct the inhibition of Hon. Gingoyon.
All told, the Court finds no grave abuse of discretion on the part of the RTC
to warrant the nullification of the questioned orders. Nonetheless, portions
of these orders should be modified to conform with law and the
pronouncements made by the Court herein.12
The decretal portion of the Court's Decision in Gingoyon thus reads:
WHEREFORE, the Petition is GRANTED in PART with respect to the
orders dated 4 January 2005 and 10 January 2005 of the lower court. Said
orders are AFFIRMED with the following MODIFICATIONS:
1) The implementation of the Writ of Possession dated 21 December 2004
is HELD IN ABEYANCE, pending payment by petitioners to PIATCO of the
amount of Three Billion Two Million One Hundred Twenty Five Thousand
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 Pesos (P3,002,125,000.00), representing the proffered value of the NAIA
3 facilities;
2) Petitioners, upon the effectivity of the Writ of Possession, are authorized
[to] start the implementation of the Ninoy Aquino International Airport
Pasenger Terminal III project by performing the acts that are essential to
the operation of the said International Airport Passenger Terminal project;
3) RTC Branch 117 is hereby directed, within sixty (60) days from finality
of this Decision, to determine the just compensation to be paid to PIATCO
by the Government.
The Order dated 7 January 2005 is AFFIRMED in all respects subject to
the qualification that the parties are given ten (10) days from finality of
this Decision to file, if they so choose, objections to the appointment of the
commissioners decreed therein.
The Temporary Restraining Order dated 14 January 2005 is hereby
LIFTED.
No pronouncement as to costs.13
Motions for Partial Reconsideration of the foregoing Decision were filed by therein
petitioners Republic and MIAA, as well as the three other parties who sought to
intervene, namely, Asakihosan Corporation, Takenaka Corporation, and
Congressman Baterina.
In a Resolution dated 1 February 2006, this Court denied with finality the Motion
for Partial Reconsideration of therein petitioners and remained faithful to its
assailed Decision based on the following ratiocination:
Admittedly, the 2004 Resolution in Agan could be construed as mandating
the full payment of the final amount of just compensation before the
Government may be permitted to take over the NAIA 3. However, the
Decision ultimately rejected such a construction, acknowledging the public
good that would result from the immediate operation of the NAIA 3.
Instead, the Decision adopted an interpretation which is in consonance
with Rep. Act No. 8974 and with equitable standards as well, that allowed
the Government to take possession of the NAIA 3 after payment of the
proffered value of the facilities to PIATCO. Such a reading is substantially
compliant with the pronouncement in the 2004 Agan Resolution, and is in
accord with law and equity. In contrast, the Government's position, hewing
to the strict application of Rule 67, would permit the Government to
acquire possession over the NAIA 3 and implement its operation without
having to pay PIATCO a single centavo, a situation that is obviously unfair.
Whatever animosity the Government may have towards PIATCO does not
acquit it from settling its obligations to the latter, particularly those which
had already been previously affirmed by this Court.14
The Court, in the same Resolution, denied all the three motions for intervention of
Asakihosan Corporation, Takenaka Corporation, and Congressman Baterina, and
ruled as follows:
We now turn to the three (3) motions for intervention all of which were filed
after the promulgation of the Court's Decision. All three (3) motions must
be denied. Under Section 2, Rule 19 of the 1997 Rules of Civil Procedure
the motion to intervene may be filed at any time before rendition of
judgment by the court. Since this case originated from an original action
filed before this Court, the appropriate time to file the motions-in-
intervention in this case if ever was before and not after resolution of this
case. To allow intervention at this juncture would be highly irregular. It is
extremely improbable that the movants were unaware of the pendency of
the present case before the Court, and indeed none of them allege such
lack of knowledge.
Takenaka and Asahikosan rely on Mago v. Court of Appeals wherein the
Court took the extraordinary step of allowing the motion for intervention
even after the challenged order of the trial court had already become final.
Yet it was apparent in Mago that the movants therein were not impleaded
despite being indispensable parties, and had not even known of the
existence of the case before the trial court, and the effect of the final order
was to deprive the movants of their land. In this case, neither Takenaka
nor Asahikosan stand to be dispossessed by reason of the Court's
Decision. There is no palpable due process violation that would militate the
suspension of the procedural rule.
Moreover, the requisite legal interest required of a party-in-intervention has
not been established so as to warrant the extra-ordinary step of allowing
intervention at this late stage. As earlier noted, the claims of Takenaka and
Asahikosan have not been judicially proved or conclusively established as
Page 363 of 507
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 fact by any trier of facts in this jurisdiction. Certainly, they could not be
considered as indispensable parties to the petition for certiorari. In the
case of Representative Baterina, he invokes his prerogative as legislator
to curtail the disbursement without appropriation of public funds to
compensate PIATCO, as well as that as a taxpayer, as the basis of his
legal standing to intervene. However, it should be noted that the amount
which the Court directed to be paid by the Government to PIATCO was
derived from the money deposited by the Manila International Airport
Authority, an agency which enjoys corporate autonomy and possesses a
legal personality separate and distinct from those of the National
Government and agencies thereof whose budgets have to be approved by
Congress.
It is also observed that the interests of the movants-in-intervention may be
duly litigated in proceedings which are extant before lower courts. There is
no compelling reason to disregard the established rules and permit the
interventions belatedly filed after the promulgation of the Court's
Decision.15
Asia's Emerging Dragon Corporation v. Department of Transportation and
Communications and Manila International Airport Authority (G.R. No. 169914)
Banking on this Court's declaration in Agan that the award of the NAIA IPT III
Project to PIATCO is null and void, Asia's Emerging Dragon Corporation (AEDC)
filed before this Court the present Petition for Mandamus and Prohibition (with
Application for Temporary Restraining Order), praying of this Court that:
(1) After due hearing, judgment be rendered commanding the
Respondents, their officers, agents, successors, representatives or
persons or entities acting on their behalf, to formally award the NAIA-APT
[sic]III PROJECT to Petitioner AEDC and to execute and formalize with
Petitioner AEDC the approved Draft Concession Agreement embodying
the agreed terms and conditions for the operation of the NAIA-IPT III
Project and directing Respondents to cease and desist from awarding the
NAIA-IPT Project to third parties or negotiating into any concession
contract with third parties.
(2) Pending resolution on the merits, a Temporary Restraining Order be
issued enjoining Respondents, their officers, agents, successors or
representatives or persons or entities acting on their behalf from
negotiating, re-bidding, awarding or otherwise entering into any
concession contract with PIATCO and other third parties for the operation
of the NAIA-IPT III Project.
Other relief and remedies, just and equitable under the premises, are
likewise prayed for.16
AEDC bases its Petition on the following grounds:
I. PETITIONER AEDC, BEING THE RECOGNIZED AND
UNCHALLENGED ORIGINAL PROPONENT, HAS THE EXCLUSIVE,
CLEAR AND VESTED STATUTORY RIGHT TO THE AWARD OF THE
NAIA-IPT III PROJECT;
II. RESPONDENTS HAVE A STATUTORY DUTY TO PROTECT
PETITIONER AEDC AS THE UNCHALLENGED ORIGINAL
PROPONENT AS A RESULT OF THE SUPREME COURT'S
NULLIFICATION OF THE AWARD OF THE NAIA-IPT III PROJECT TO
PIATCO[; and]
III. RESPONDENTS HAVE NO LEGAL BASIS OR AUTHORITY TO TAKE
OVER THE NAIA-IPT III PROJECT, TO THE EXCLUSION OF
PETITIONER AEDC, OR TO AWARD THE PROJECT TO THIRD
PARTIES.17
At the crux of the Petition of AEDC is its claim that, being the recognized and
unchallenged original proponent of the NAIA IPT III Project, it has the exclusive,
clear, and vested statutory right to the award thereof. However, the Petition of
AEDC should be dismissed for lack of merit, being as it is, substantially and
procedurally flawed.
SUBSTANTIVE INFIRMITY
A petition for mandamus is governed by Section 3 of Rule 65 of the Rules of Civil
Procedure, which reads –
SEC. 3. Petition for mandamus. – When any tribunal, corporation, board,
officer or person unlawfully neglects the performance of an act which the
law specifically enjoins as a duty resulting from an office, trust, or station,
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 or unlawfully excludes another from the use and enjoyment of a right or
office to which such other is entitled, and there is no other plain, speedy
and adequate remedy in the ordinary course of law, the person aggrieved
thereby may file a verified petition in the proper court, alleging the facts
with certainty and praying that judgment be rendered commanding the
respondent, immediately or some other time to be specified by the court,
to do the act required to be done to protect the rights of the petitioner, and
to pay the damages sustained by the petitioner by reason of the wrongful
acts of the respondent.
It is well-established in our jurisprudence that only specific legal rights are
enforceable by mandamus, that the right sought to be enforced must be certain
and clear, and that the writ will not issue in cases where the right is doubtful. Just
as fundamental is the principle governing the issuance of mandamus that the
duties to be performed must be such as are clearly and peremptorily enjoined by
law or by reason of official station.18
A rule long familiar is that mandamus never issues in doubtful cases. It requires a
showing of a complete and clear legal right in the petitioner to the performance of
ministerial acts. In varying language, the principle echoed and reechoed is that
legal rights may be enforced by mandamus only if those rights are well-defined,
clear and certain. Otherwise, the mandamus petition must be dismissed.19
The right that AEDC is seeking to enforce is supposedly enjoined by Section 4-A of
Republic Act No. 6957,20 as amended by Republic Act No. 7718, on unsolicited
proposals, which provides –
SEC. 4-A. Unsolicited proposals. – Unsolicited proposals for projects may
be accepted by any government agency or local government unit on a
negotiated basis: Provided, That, all the following conditions are met: (1)
such projects involve a new concept or technology and/or are not part of
the list of priority projects, (2) no direct government guarantee, subsidy or
equity is required, and (3) the government agency or local government unit
has invited by publication, for three (3) consecutive weeks, in a newspaper
of general circulation, comparative or competitive proposals and no other
proposal is received for a period of sixty (60) working days: Provided,
further, That in the event another proponent submits a lower price
proposal, the original proponent shall have the right to match the price
within thirty (30) working days.
In furtherance of the afore-quoted provision, the Implementing Rules and
Regulations (IRR) of Republic Act No. 6957, as amended by Republic Act No.
7718, devoted the entire Rule 10 to Unsolicited Proposals, pertinent portions of
which are reproduced below –
Sec. 10.1. Requisites for Unsolicited Proposals. – Any Agency/LGU may
accept unsolicited proposals on a negotiated basis provided that all the
following conditions are met:
a. the project involves a new concept or technology and/or is not part of
the list of priority projects;
b. no direct government guarantee, subsidy or equity is required; and
c. the Agency/LGU concerned has invited by publication, for three (3)
consecutive weeks, in a newspaper of general circulation, comparative or
competitive proposals and no other proposal is received for a period of
sixty (60) working days. In the event that another project proponent
submits a price proposal lower than that submitted by the original
proponent, the latter shall have the right to match said price proposal
within thirty (30) working days. Should the original proponent fail to match
the lower price proposal submitted within the specified period, the contract
shall be awarded to the tenderer of the lowest price. On the other hand, if
the original project proponent matches the submitted lowest price within
the specified period, he shall be immediately be awarded the project.
xxxx
Sec. 10.6. Evaluation of Unsolicited Proposals. – The Agency/LGU is
tasked with the initial evaluation of the proposal. The Agency/LGU shall: 1)
appraise the merits of the project; 2) evaluate the qualification of the
proponent; and 3) assess the appropriateness of the contractual
arrangement and reasonableness of the risk allocation. The Agency/LGU
is given sixty (60) days to evaluate the proposal from the date of
submission of the complete proposal. Within this 60-day period, the
Agency/LGU, shall advise the proponent in writing whether it accepts or
rejects the proposal. Acceptance means commitment of the
Agency/LGU to pursue the project and recognition of the proponent
as the "original proponent." At this point, the Agency/LGU will no
longer entertain other similar proposals until the solicitation of
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comparative proposals. The implementation of the project, however, is
still contingent primarily on the approval of the appropriate approving
authorities consistent with Section 2.7 of these IRR, the agreement
between the original proponent and the Agency/LGU of the contract terms,
and the approval of the contract by the [Investment Coordination
Committee (ICC)] or Local Sanggunian.
xxxx
Sec. 10.9. Negotiation With the Original Proponent. – Immediately after
ICC/Local Sanggunian's clearance of the project, the Agency/LGU
shall proceed with the in-depth negotiation of the project scope,
implementation arrangements and concession agreement, all of
which will be used in the Terms of Reference for the solicitation of
comparative proposals. The Agency/LGU and the proponent are given
ninety (90) days upon receipt of ICC's approval of the project to conclude
negotiations. The Agency/LGU and the original proponent shall negotiate
in good faith. However, should there be unresolvable differences
during the negotiations, the Agency/LGU shall have the option to
reject the proposal and bid out the project. On the other hand, if the
negotiation is successfully concluded, the original proponent shall
then be required to reformat and resubmit its proposal in accordance
with the requirements of the Terms of Reference to facilitate
comparison with the comparative proposals. The Agency/LGU shall
validate the reformatted proposal if it meets the requirements of the
TOR prior to the issuance of the invitation for comparative proposals.
xxxx
Sec. 10.11. Invitation for Comparative Proposals. The Agency/LGU shall
publish the invitation for comparative or competitive proposals only after
ICC/Local Sanggunian issues a no objection clearance of the draft
contract. The invitation for comparative or competitive proposals should be
published at least once every week for three (3) weeks in at least one (1)
newspaper of general circulation. It shall indicate the time, which should
not be earlier than the last date of publication, and place where
tender/bidding documents could be obtained. It shall likewise explicitly
specify a time of sixty (60) working days reckoned from the date of
issuance of the tender/bidding documents upon which proposals shall be
received. Beyond said deadline, no proposals shall be accepted. A pre-bid
conference shall be conducted ten (10) working days after the issuance of
the tender/bidding documents.
Sec. 10.12. Posting of Bid Bond by Original Proponent. – The original
proponent shall be required at the date of the first date of the publication of
the invitation for comparative proposals to submit a bid bond equal to
the amount and in the form required of the challengers.
Sec. 10.13. Simultaneous Qualification of the Original Proponent. – The
Agency/LGU shall qualify the original proponent based on the provisions of
Rule 5 hereof, within thirty (30) days from start of negotiation. For
consistency, the evaluation criteria used for qualifying the original
proponent should be the same criteria used for qualifying the original
proponent should be the criteria used in the Terms of Reference for the
challengers.
xxxx
Sec. 10.16. Disclosure of the Price Proposal. – The disclosure of the price
proposal of the original proponent in the Tender Documents will be left to
the discretion of the Agency/LGU. However, if it was not disclosed in the
Tender Documents, the original proponent's price proposal should be
revealed upon the opening of the financial proposals of the
challengers. The right of the original proponent to match the best
proposal within thirty (30) working days starts upon official
notification by the Agency/LGU of the most advantageous financial
proposal. (Emphasis ours.)
In her sponsorship speech on Senate Bill No. 1586 (the precursor of Republic Act
No. 7718), then Senator (now President of the Republic of the Philippines) Gloria
Macapagal-Arroyo explained the reason behind the proposed amendment that
would later become Section 4-A of Republic Act No. 6957, as amended by
Republic Act No. 7718:
The object of the amendment is to protect proponents which have already
incurred costs in the conceptual design and in the preparation of the
proposal, and which may have adopted an imaginative method of
construction or innovative concept for the proposal. The amendment also
aims to harness the ingenuity of the private sector to come up with
solutions to the country's infrastructure problems.21
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It is irrefragable that Section 4-A of Republic Act No. 6957, as amended by
Republic Act No. 7718, and Section 10 of its IRR, accord certain rights or
privileges to the original proponent of an unsolicited proposal for an infrastructure
project. They are meant to encourage private sector initiative in conceptualizing
infrastructure projects that would benefit the public. Nevertheless, none of these
rights or privileges would justify the automatic award of the NAIA IPT III Project to
AEDC after its previous award to PIATCO was declared null and void by this Court
in Agan.
The rights or privileges of an original proponent of an unsolicited proposal for an
infrastructure project are never meant to be absolute. Otherwise, the original
proponent can hold the Government hostage and secure the award of the
infrastructure project based solely on the fact that it was the first to submit a
proposal. The absurdity of such a situation becomes even more apparent when
considering that the proposal is unsolicited by the Government. The rights or
privileges of an original proponent depends on compliance with the procedure and
conditions explicitly provided by the statutes and their IRR.
An unsolicited proposal is subject to evaluation, after which, the government
agency or local government unit (LGU) concerned may accept or reject the
proposal outright.
Under Section 10.6 of the IRR, the "acceptance" of the unsolicited proposal by the
agency/LGU is limited to the "commitment of the [a]gency/LGU to pursue the
project and recognition of the proponent as the 'original proponent.'" Upon
acceptance then of the unsolicited proposal, the original proponent
is recognized as such but no award is yet made to it. The commitment of the
agency/LGU upon acceptance of the unsolicited proposal is to the pursuit of the
project, regardless of to whom it shall subsequently award the same. The
acceptance of the unsolicited proposal only precludes the agency/LGU from
entertaining other similar proposals until the solicitation of comparative proposals.
Consistent in both the statutes and the IRR is the requirement that invitations be
published for comparative or competitive proposals. Therefore, it is mandatory that
a public bidding be held before the awarding of the project. The negotiations
between the agency/LGU and the original proponent, as provided in Section 10.9
of the IRR, is for the sole purpose of coming up with draft agreements, which shall
be used in the Terms of Reference (TOR) for the solicitation of comparative
proposals. Even at this point, there is no definite commitment made to the original
proponent as to the awarding of the project. In fact, the same IRR provision even
gives the concerned agency/LGU, in case of unresolvable differences during the
negotiations, the option to reject the original proponent's proposal and just bid out
the project.
Generally, in the course of processing an unsolicited proposal, the original
proponent is treated in much the same way as all other prospective bidders for the
proposed infrastructure project. It is required to reformat and resubmit its proposal
in accordance with the requirements of the TOR.22 It must submit a bid bond equal
to the amount and in the form required of the challengers. 23 Its qualification shall
be evaluated by the concerned agency/LGU, using evaluation criteria in
accordance with Rule 524 of the IRR, and which shall be the same criteria to be
used in the TOR for the challengers.25 These requirements ensure that the public
bidding under Rule 10 of IRR on Unsolicited Proposals still remain in accord with
the three principles in public bidding, which are: the offer to the public, an
opportunity for competition, and a basis for exact comparison of bids. 26
The special rights or privileges of an original proponent thus come into play only
when there are other proposals submitted during the public bidding of the
infrastructure project. As can be gleaned from the plain language of the statutes
and the IRR, the original proponent has: (1) the right to match the lowest or most
advantageous proposal within 30 working days from notice thereof, and (2) in the
event that the original proponent is able to match the lowest or most advantageous
proposal submitted, then it has the right to be awarded the project. The second
right or privilege is contingent upon the actual exercise by the original proponent of
the first right or privilege. Before the project could be awarded to the original
proponent, he must have been able to match the lowest or most advantageous
proposal within the prescribed period. Hence, when the original proponent is able
to timely match the lowest or most advantageous proposal, with all things being
equal, it shall enjoy preference in the awarding of the infrastructure project.
This is the extent of the protection that Legislature intended to afford the original
proponent, as supported by the exchange between Senators Neptali Gonzales and
Sergio Osmeña during the Second Reading of Senate Bill No. 1586:
Senator Gonzales:
xxxx
The concept being that in case of an unsolicited proposal and nonetheless
public bidding has been held, then [the original proponent] shall, in
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 effect, be granted what is the equivalent of the right of first refusal by
offering a bid which shall equal or better the bid of the winning
bidder within a period of, let us say, 30 days from the date of bidding.
Senator Osmeña:
xxxx
To capture the tenor of the proposal of the distinguished Gentleman, a
subsequent paragraph has to be added which says, "IF THERE IS A
COMPETITIVE PROPOSAL, THE ORIGINAL PROPONENT SHALL
HAVE THE RIGHT TO EQUAL THE TERMS AND CONDITIONS OF THE
COMPETITIVE PROPOSAL."
In other words, if there is nobody who will submit a competitive proposal,
then nothing is lost. Everybody knows it, and it is open and transparent.
But if somebody comes in with another proposal – and because it was the
idea of the original proponent – that proponent now has the right to equal
the terms of the original proposal.
SENATOR GONZALES:
That is the idea, Mr. President. Because it seems to me that it is utterly
unfair for one who has conceived an idea or a concept, spent and invested
in feasibility studies, in the drawing of plans and specifications, and the
project is submitted to a public bidding, then somebody will win on the
basis of plans and specifications and concepts conceived by the original
proponent. He should at least be given the right to submit an
equalizing bid. x x x.27 (Emphasis ours.)
As already found by this Court in the narration of facts in Agan, AEDC failed to
match the more advantageous proposal submitted by PIATCO by the time the 30-
day working period expired on 28 November 1996;28 and, without exercising its
right to match the most advantageous proposal, it cannot now lay claim to the
award of the project.
The bidding process as to the NAIA IPT III Project was already over after the
award thereof to PIATCO, even if eventually, the said award was nullified and
voided. The nullification of the award to PIATCO did not revive the proposal nor re-
open the bidding. AEDC cannot insist that this Court turn back the hands of time
and award the NAIA IPT III Project to it, as if the bid of PIATCO never existed and
the award of the project to PIATCO did not take place. Such is a simplistic
approach to a very complex problem that is the NAIA IPT III Project.
In his separate opinion in Agan, former Chief Justice Artemio V. Panganiban noted
that "[T]here was effectively no public bidding to speak of, the entire bidding
process having been flawed and tainted from the very outset, therefore, the
award of the concession to Paircargo's successor Piatco was void, and the
Concession Agreement executed with the latter was likewise void ab initio. x x x.29"
(Emphasis ours.) In consideration of such a declaration that the entire bidding
process was flawed and tainted from the very beginning, then, it would be
senseless to re-open the same to determine to whom the project should have been
properly awarded to. The process and all proposals and bids submitted in
participation thereof, and not just PIATCO's, were placed in doubt, and it would be
foolhardy for the Government to rely on them again. At the very least, it may be
declared that there was a failure of public bidding. 30
In addition, PIATCO is already close to finishing the building of the structures
comprising NAIA IPT III,31 a fact that this Court cannot simply ignore. The NAIA
IPT III Project was proposed, subjected to bidding, and awarded as a build-
operate-transfer (BOT) project. A BOT project is defined as –
A contractual arrangement whereby the project proponent undertakes
the construction, including financing, of a given infrastructure facility,
and the operation and maintenance thereof. The project proponent
operates the facility over a fixed term during which it is allowed to charge
facility users appropriate tolls, fees, rentals, and charges not exceeding
those proposed in its bid or as negotiated and incorporated in the contract
to enable the project proponent to recover its investment, and operating
and maintenance expenses in the project. The project
proponent transfers the facility to the government agency or local
government unit concerned at the end of the fixed term that shall not
exceed fifty (50) years. This shall include a supply-and-operate situation
which is a contractual arrangement whereby the supplier of equipment and
machinery for a given infrastructure facility, if the interest of the
Government so requires, operates the facility providing in the process
technology transfer and training to Filipino nationals.32 (Emphasis ours.)
The original proposal of AEDC is for a BOT project, in which it undertook
to build, operate, and transfer to the Government the NAIA IPT III facilities. This is
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clearly no longer applicable or practicable under the existing circumstances. It is
undeniable that the physical structures comprising the NAIA IPT III Project are
already substantially built, and there is almost nothing left for AEDC to construct.
Hence, the project could no longer be awarded to AEDC based on the theory of
legal impossibility of performance.
Neither can this Court revert to the original proposal of AEDC and award to it only
the unexecuted components of the NAIA IPT III Project. Whoever shall assume the
obligation to operate and maintain NAIA IPT III and to subsequently transfer the
same to the Government (in case the operation is not assumed by the Government
itself) shall have to do so on terms and conditions that would necessarily be
different from the original proposal of AEDC. It will no longer include any
undertaking to build or construct the structures. An amendment of the proposal of
AEDC to address the present circumstances is out of the question since such an
amendment would be substantive and tantamount to an entirely new proposal,
which must again be subjected to competitive bidding.
AEDC's offer to reimburse the Government the amount it shall pay to PIATCO for
the NAIA IPT III Project facilities, as shall be determined in the ongoing
expropriation proceedings before the RTC of Pasay City, cannot restore AEDC to
its status and rights as the project proponent. It must be stressed that the law
requires the project proponent to undertake the construction of the
project, including financing; financing, thus, is but a component of the
construction of the structures and not the entirety thereof.
Moreover, this "reimbursement arrangement" may even result in the unjust
enrichment of AEDC. In its original proposal, AEDC offered to construct the NAIA
IPT III facilities for $350 million or P9 billion at that time. In exchange, AEDC would
share a certain percentage of the gross revenues with, and pay a guaranteed
annual income to the Government upon operation of the NAIA IPT III. In Gingoyon,
the proferred value of the NAIA IPT III facilities was already determined to be P3
billion. It seems improbable at this point that the balance of the value of said
facilities for which the Government is still obligated to pay PIATCO shall reach or
exceed P6 billion. There is thus the possibility that the Government shall be
required to pay PIATCO an amount less than P9 billion. If AEDC is to reimburse
the Government only for the said amount, then it shall acquire the NAIA IPT III
facilities for a price less than its original proposal of P9 billion. Yet, per the other
terms of its original proposal, it may still recoup a capital investment of P9 billion
plus a reasonable rate of return of investment. A change in the agreed value of the
NAIA IPT III facilities already built cannot be done without a corresponding
amendment in the other terms of the original proposal as regards profit sharing
and length of operation; otherwise, AEDC will be unjustly enriched at the expense
of the Government.
Again, as aptly stated by former Chief Justice Panganiban, in his separate opinion
in Agan:
If the PIATCO contracts are junked altogether as I think they should be,
should not AEDC automatically be considered the winning bidder and
therefore allowed to operate the facility? My answer is a stone-cold 'No.'
AEDC never won the bidding, never signed any contract, and never built
any facility. Why should it be allowed to automatically step in and benefit
from the greed of another?33
The claim of AEDC to the award of the NAIA IPT III Project, after the award thereof
to PIATCO was set aside for being null and void, grounded solely on its being the
original proponent of the project, is specious and an apparent stretch in the
interpretation of Section 4-A of Republic Act No. 6957, as amended by Republic
Act No. 7718, and Rule 10 of the IRR.
In all, just as AEDC has no legal right to the NAIA IPT III Project, corollarily, it has
no legal right over the NAIA IPT III facility. AEDC does not own the NAIA IPT III
facility, which this Court already recognized in Gingoyon as owned by PIATCO; nor
does AEDC own the land on which NAIA IPT III stands, which is undisputedly
owned by the Republic through the Bases Conversion Development Authority
(BCDA). AEDC did not fund any portion of the construction of NAIA IPT III, which
was entirely funded by PIATCO. AEDC also does not have any kind of lien over
NAIA IPT III or any kind of legal entitlement to occupy the facility or the land on
which it stands. Therefore, nothing that the Government has done or will do in
relation to the project could possibly prejudice or injure AEDC. AEDC then does
not possess any legal personality to interfere with or restrain the activities of the
Government as regards NAIA IPT III. Neither does it have the legal personality to
demand that the Government deliver or sell to it the NAIA IPT III facility despite the
express willingness of AEDC to reimburse the Government the proferred amount it
had paid PIATCO and complete NAIA IPT III facility at its own cost.
AEDC invokes the Memorandum of Agreement, purportedly executed between the
DOTC and AEDC on 26 February 1996, following the approval of the NAIA IPT III
Project by the National Economic Development Authority Board in a Resolution
dated 13 February 1996, which provided for the following commitments by the
parties:
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 a. commitment of Respondent DOTC to target mid 1996 as the time frame
for the formal award of the project and commencement of site preparation
and construction activities with the view of a partial opening of the
Terminal by the first quarter of 1998;
b. commitment of Respondent DOTC to pursue the project envisioned in
the unsolicited proposal and commence and conclude as soon as possible
negotiations with Petitioner AEDC on the BOT contract;
c. commitment of Respondent DOTC to make appropriate arrangements
through which the formal award of the project can be affected[;]
d. commitment of Petitioner AEDC to a fast track approach to project
implementation and to commence negotiations with its financial partners,
investors and creditors;
e. commitment of Respondent DOTC and Petitioner AEDC to fast track
evaluation of competitive proposals, screening and eliminating nuisance
comparative bids;34
It is important to note, however, that the document attached as Annex "E" to the
Petition of AEDC is a "certified photocopy of records on file." This Court cannot
give much weight to said document considering that its existence and due
execution have not been established. It is not notarized, so it does not enjoy the
presumption of regularity of a public document. It is not even witnessed by anyone.
It is not certified true by its supposed signatories, Secretary Jesus B. Garcia, Jr. for
DOTC and Chairman Henry Sy, Sr. for AEDC, or by any government agency
having its custody. It is certified as a photocopy of records on file by an Atty.
Cecilia L. Pesayco, the Corporate Secretary, of an unidentified corporation.
Even assuming for the sake of argument, that the said Memorandum of
Agreement, is in existence and duly executed, it does little to support the claim of
AEDC to the award of the NAIA IPT III Project. The commitments undertaken by
the DOTC and AEDC in the Memorandum of Agreement may be simply
summarized as a commitment to comply with the procedure and requirements
provided in Rules 10 and 11 of the IRR. It bears no commitment on the part of the
DOTC to award the NAIA IPT III Project to AEDC. On the contrary, the document
includes express stipulations that negate any such government obligation. Thus, in
the first clause,35 the DOTC affirmed its commitment to pursue, implement and
complete the NAIA IPT III Project on or before 1998, noticeably without mentioning
that such commitment was to pursue the project specifically with AEDC. Likewise,
in the second clause,36 it was emphasized that the DOTC shall pursue the project
under Rules 10 and 11 of the IRR of Republic Act No. 6957, as amended by
Republic Act No. 7718. And most significantly, the tenth clause of the same
document provided:
10. Nothing in this Memorandum of Understanding shall be understood,
interpreted or construed as permitting, allowing or authorizing the
circumvention of, or non-compliance with, or as waiving, the provisions of,
and requirements and procedures under, existing laws, rules and
regulations.37
AEDC further decries that:
24. In carrying out its commitments under the DOTC-AEDC MOU,
Petitioner AEDC undertook the following activities, incurring in the process
tremendous costs and expenses.
a. pre-qualified 46 design and contractor firms to assist in the NAIA-IPT III
Project;
b. appointed a consortium of six (6) local banks as its financial advisor in
June 1996;
c. hired the services of GAIA South, Inc. to prepare the Project Description
Report and to obtain the Environmental Clearance Certificate (ECC) for
the NAIA-IPT III Project;
d. coordinated with the Airline Operators Association, Bases Conversion
Development Authority, Philippine Air Force, Bureau of Customs, Bureau
of Immigration, relative to their particular requirements regarding the NAIA-
IPT III [P]roject; and
e. negotiated and entered into firm commitments with Ital Thai, Marubeni
Corporation and Mitsui Corporation as equity partners. 38
While the Court may concede that AEDC, as the original proponent, already
expended resources in its preparation and negotiation of its unsolicited proposal,
the mere fact thereof does not entitle it to the instant award of the NAIA IPT III
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Project. AEDC was aware that the said project would have to undergo public
bidding, and there existed the possibility that another proponent may submit a
more advantageous bid which it cannot match; in which case, the project shall be
awarded to the other proponent and AEDC would then have no means to recover
the costs and expenses it already incurred on its unsolicited proposal. It was a
given business risk that AEDC knowingly undertook.
Additionally, the very defect upon which this Court nullified the award of the NAIA
IPT III Project to PIATCO similarly taints the unsolicited proposal of AEDC. This
Court found Paircargo Consortium financially disqualified after striking down as
incorrect the PBAC's assessment of the consortium's financial capability.
According to the Court's ratio in Agan:
As the minimum project cost was estimated to be US$350,000,000.00 or
roughly P9,183,650,000.00, the Paircargo Consortium had to show to the
satisfaction of the PBAC that it had the ability to provide the minimum
equity for the project in the amount of at least P2,755,095,000.00.
xxxx
Thus, the maximum amount that Security Bank could validly invest in the
Paircargo Consortium is only P528,525,656.55, representing 15% of its
entire net worth. The total net worth therefore of the Paircargo Consortium,
after considering the maximum amounts that may be validly invested by
each of its members is P558,384,871.55 or only 6.08% of the project
cost, an amount substantially less than the prescribed minimum equity
investment required for the project in the amount of P2,755,095,000.00 or
30% of the project cost.
The purpose of pre-qualification in any public bidding is to determine, at
the earliest opportunity, the ability of the bidder to undertake the project.
Thus, with respect to the bidder's financial capacity at the pre-qualification
stage, the law requires the government agency to examine and determine
the ability of the bidder to fund the entire cost of the project by
considering the maximum amounts that each bidder may invest in
the project at the time of pre-qualification.
xxxx
Thus, if the maximum amount of equity that a bidder may invest in the
project at the time the bids are submitted falls short of the minimum
amounts required to be put up by the bidder, said bidder should be
properly disqualified. Considering that at the pre-qualification stage, the
maximum amounts which the Paircargo Consortium may invest in the
project fell short of the minimum amounts prescribed by the PBAC, we
hold that Paircargo Consortium was not a qualified bidder. Thus the award
of the contract by the PBAC to the Paircargo Consortium, a disqualified
bidder, is null and void.39
Pursuant to the above-quoted ruling, AEDC, like the Paircargo Consortium, would
not be financially qualified to undertake the NAIA IPT III Project. Based on AEDC's
own submissions to the Government, it had then a paid-in capital of
only P150,000,000.00,40 which was less than the P558,384,871.55 that Paircargo
Consortium was capable of investing in the NAIA IPT III Project, and even far less
that what this Court prescribed as the minimum equity investment required for the
project in the amount of P2,755,095,000.00 or 30% of the project cost. AEDC had
not sufficiently demonstrated that it would have been financially qualified to
undertake the project at the time of submission of the bids.
Instead, AEDC took pains to present to this Court that allowing it to take over and
operate NAIA IPT III at present would be beneficial to the Government. This Court
must point out, however, that AEDC is precisely making a new proposal befitting
the current status of the NAIA IPT III Project, contrary to its own argument that it is
merely invoking its original BOT proposal. And it is not for this Court to evaluate
AEDC's new proposal and assess whether it would truly be most beneficial for the
Government, for the same is an executive function rather than judicial, for which
the statutes and regulations have sufficiently provided standards and procedures
for evaluation.
It can even be said that if the award of the NAIA IPT III Project was merely a
matter of choosing between PIATCO and AEDC (which it is not), there could be no
doubt that PIATCO is more qualified to operate the structure that PIATCO itself
built and PIATCO's offer of P17.75 Billion in annual guaranteed payments to the
Government is far better that AEDC's offer of P135 Million.
Hence, AEDC is not entitled to a writ of mandamus, there being no specific,
certain, and clear legal right to be enforced, nor duty to be performed that is clearly
and peremptorily enjoined by law or by reason of official station.
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PROCEDURAL LAPSES
In addition to the substantive weaknesses of the Petition of AEDC, the said
Petition also suffers from procedural defects.
AEDC revived its hope to acquire the NAIA IPT III Project when this Court
promulgated its Decision in Agan on 5 May 2003. The said Decision became final
and executory on 17 February 2004 upon the denial by this Court of the Motion for
Leave to File Second Motion for Reconsideration submitted by PIATCO. It is this
Decision that declared the award of the NAIA IPT III Project to PIATCO as null and
void; without the same, then the award of the NAIA IPT III Project to PIATCO
would still subsist and other persons would remain precluded from acquiring rights
thereto, including AEDC. Irrefutably, the present claim of AEDC is rooted in the
Decision of this Court in Agan. However, AEDC filed the Petition at bar only 20
months after the promulgation of the Decision in Agan on 5 May 2003.
It must be emphasized that under Sections 2 and 3, Rule 65 of the revised Rules
of Civil Procedure, petitions for prohibition and mandamus, such as in the instant
case, can only be resorted to when there is no other plain, speedy and adequate
remedy for the party in the ordinary course of law.
In Cruz v. Court of Appeals,41 this Court elucidates that –
Although Rule 65 does not specify any period for the filing of a petition for
certiorari and mandamus, it must, nevertheless, be filed within a
reasonable time. In certiorari cases, the definitive rule now is that such
reasonable time is within three months from the commission of the
complained act. The same rule should apply to mandamus cases.
The unreasonable delay in the filing of the petitioner's mandamus suit
unerringly negates any claim that the application for the said extraordinary
remedy was the most expeditious and speedy available to the petitioner.
(Emphasis ours.)
As the revised Rules now stand, a petition for certiorari may be filed within 60 days
from notice of the judgment, order or resolution sought to be
assailed.42 Reasonable time for filing a petition for mandamus should likewise be
for the same period. The filing by the AEDC of its petition for mandamus 20
months after its supposed right to the project arose is evidently beyond reasonable
time and negates any claim that the said petition for the extraordinary writ was the
most expeditious and speedy remedy available to AEDC.
AEDC contends that the "reasonable time" within which it should have filed its
petition should be reckoned only from 21 September 2005, the date when AEDC
received the letter from the Office of the Solicitor General refusing to recognize the
rights of AEDC to provide the available funds for the completion of the NAIA IPT III
Project and to reimburse the costs of the structures already built by PIATCO. It has
been unmistakable that even long before said letter – especially when the
Government instituted with the RTC of Pasay City expropriation proceedings for
the NAIA IPT III on 21 December 2004 – that the Government would not recognize
any right that AEDC purportedly had over the NAIA IPT III Project and that the
Government is intent on taking over and operating the NAIA IPT III itself.
Another strong argument against the AEDC's Petition is that it is already barred
by res judicata.
In Agan,43 it was noted that on 16 April 1997, the AEDC instituted before the RTC
of Pasig City Civil Case No. 66213, a Petition for the Declaration of Nullity of the
Proceedings, Mandamus and Injunction, against the DOTC Secretary and the
PBAC Chairman and members.
In Civil Case No. 66213, AEDC prayed for:
i) the nullification of the proceedings before the DOTC-PBAC, including its
decision to qualify Paircargo Consortium and to deny Petitioner AEDC's
access to Paircargo Consortium's technical and financial bid documents;
ii) the protection of Petitioner AEDC's right to match considering the void
challenge bid of the Paircargo Consortium and the denial by DOTC-PBAC
of access to information vital to the effective exercise of its right to match;
iii) the declaration of the absence of any other qualified proponent
submitting a competitive bid in an unsolicited proposal.44
Despite the pendency of Civil Case No. 66213, the DOTC issued the notice of
award for the NAIA IPT III Project to PIATCO on 9 July 1997. The DOTC and
PIATCO also executed on 12 July 1997 the 1997 Concession Agreement. AEDC
then alleges that:
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 k) On September 3, 1998, then Pres. Joseph Ejercito Estrada convened a
meeting with the members of the Board of Petitioner AEDC to convey his
"desire" for the dismissal of the mandamus case filed by Petition AEDC
and in fact urged AEDC to immediately withdraw said case.
l) The President's direct intervention in the disposition of this mandamus
case was a clear imposition that Petitioner AEDC had not choice but to
accept. To do otherwise was to take a confrontational stance against the
most powerful man in the country then under the risk of catching his ire,
which could have led to untold consequences upon the business interests
of the stakeholders in AEDC. Thus, Petitioner AEDC was constrained to
agree to the signing of a Joint Motion to Dismiss and to the filing of the
same in court.
m) Unbeknownst to AEDC at that time was that simultaneous with the
signing of the July 12, 1997 Concession Agreement, the DOTC and
PIATCO executed a secret side agreement grossly prejudicial and
detrimental to the interest of Government. It stipulated that in the event
that the Civil Case filed by AEDC on April 16, 1997 is not resolved in a
manner favorable to the Government, PIATCO shall be entitled to full
reimbursement for all costs and expenses it incurred in order to obtain the
NAIA IPT III BOT project in an amount not less than One Hundred Eighty
Million Pesos (Php 180,000,000.00). This was apparently the reason why
the President was determined to have AEDC's case dismissed
immediately.
n) On February 9, 1999, after the Amended and Restated Concession
Agreement (hereinafter referred to as "ARCA") was signed without
Petitioner AEDC's knowledge, Petitioner AEDC signed a Joint Motion to
Dismiss upon the representation of the DOTC that it would provide AEDC
with a copy of the 1997 Concession Agreement. x x x. 45
On 30 April 1999, the RTC of Pasig City issued an Order dismissing with
prejudice Civil Case No. 66213 upon the execution by the parties of a Joint
Motion to Dismiss. According to the Joint Motion to Dismiss –
The parties, assisted by their respective counsel, respectfully state:
1. Philippine International Air Terminals Company, Inc. ("PIATCO") and
the respondents have submitted to petitioner, through the Office of the
Executive Secretary, Malacañang, a copy of the Concession Agreement
which they executed for the construction and operation of the Ninoy
Aquino International Airport International Passenger Terminal III Project
("NAIA IPT III Project), which petitioner requested.
2. Consequently, the parties have decided to amicably settle the instant
case and jointly move for the dismissal thereof without any of the
parties admitting liability or conceding to the position taken by the other in
the instant case.
3. Petitioner, on the other hand, and the respondents, on the other hand,
hereby release and forever discharge each other from any and all
liabilities, direct or indirect, whether criminal or civil, which arose in
connection with the instant case.
4. The parties agree to bear the costs, attorney's fees and other expenses
they respectively incurred in connection with the instant case. (Emphasis
ours.)
AEDC, however, invokes the purported pressure exerted upon it by then President
Joseph E. Estrada, the alleged fraud committed by the DOTC, and paragraph 2 in
the afore-quoted Joint Motion to Dismiss to justify the non-application of the
doctrine of res judicata to its present Petition.
The elements of res judicata, in its concept as a bar by former judgment, are as
follows: (1) the former judgment or order must be final; (2) it must be a judgment or
order on the merits, that is, it was rendered after a consideration of the evidence or
stipulations submitted by the parties at the trial of the case; (3) it must have been
rendered by a court having jurisdiction over the subject matter and the parties; and
(4) there must be, between the first and second actions, identity of parties, of
subject matter and of cause of action.46 All of the elements are present herein so
as to bar the present Petition.
First, the Order of the RTC of Pasig City, dismissing Civil Case No. 66213, was
issued on 30 April 1999. The Joint Motion to Dismiss, deemed a compromise
agreement, once approved by the court is immediately executory and not
appealable.47
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Second, the Order of the RTC of Pasig City dismissing Civil Case No. 66213
pursuant to the Joint Motion to Dismiss filed by the parties constitutes a judgment
on the merits.
The Joint Motion to Dismiss stated that the parties were willing to settle the case
amicably and, consequently, moved for the dismissal thereof. It also contained a
provision in which the parties – the AEDC, on one hand, and the DOTC Secretary
and PBAC, on the other – released and forever discharged each other from any
and all liabilities, whether criminal or civil, arising in connection with the case. It is
undisputable that the parties entered into a compromise agreement, defined as "a
contract whereby the parties, by making reciprocal concessions, avoid a litigation
or put an end to one already commenced.48" Essentially, it is a contract perfected
by mere consent, the latter being manifested by the meeting of the offer and the
acceptance upon the thing and the cause which are to constitute the contract.
Once an agreement is stamped with judicial approval, it becomes more than a
mere contract binding upon the parties; having the sanction of the court and
entered as its determination of the controversy, it has the force and effect of any
other judgment.49 Article 2037 of the Civil Code explicitly provides that a
compromise has upon the parties the effect and authority of res judicata.
Because of the compromise agreement among the parties, there was accordingly
a judicial settlement of the controversy, and the Order, dated 30 April 1999, of the
RTC of Pasig City was no less a judgment on the merits which may be annulled
only upon the ground of extrinsic fraud.50 Thus, the RTC of Pasig City, in the same
Order, correctly granted the dismissal of Civil Case No. 66213 with prejudice.
A scrutiny of the Joint Motion to Dismiss submitted to the RTC of Pasig City would
reveal that the parties agreed to discharge one another from any and all liabilities,
whether criminal or civil, arising from the case, after AEDC was furnished with a
copy of the 1997 Concession Agreement between the DOTC and PIATCO. This
complete waiver was the reciprocal concession of the parties that puts to an end
the present litigation, without any residual right in the parties to litigate the same in
the future. Logically also, there was no more need for the parties to admit to any
liability considering that they already agreed to absolutely discharge each other
therefrom, without necessarily conceding to the other's position. For AEDC, it was
a declaration that even if it was not conceding to the Government's position, it was
nonetheless waiving any legal entitlement it might have to sue the Government on
account of the NAIA IPT III Project. Conversely, for the Government, it was an
avowal that even if it was not accepting AEDC's stance, it was all the same
relinquishing its right to file any suit against AEDC in connection with the same
project. That none of the parties admitted liability or conceded its position is
without bearing on the validity or binding effect of the compromise agreement,
considering that these were not essential to the said compromise.
Third, there is no question as to the jurisdiction of the RTC of Pasig City over the
subject matter and parties in Civil Case No. 66213. The RTC can exercise original
jurisdiction over cases involving the issuance of writs of certiorari,
prohibition, mandamus, quo warranto, habeas corpus and injunction.51 To recall,
the Petition of AEDC before the RTC of Pasig City was for the declaration of nullity
of proceedings, mandamus and injunction. The RTC of Pasig City likewise had
jurisdiction over the parties, with the voluntary submission by AEDC and proper
service of summons on the DOTC Secretary and the PBAC Chairman and
members.
Lastly, there is, between Civil Case No. 66213 before the RTC of Pasig City and
the Petition now pending before this Court, an identity of parties, of subject matter,
and of causes of action.
There is an identity of parties. In both petitions, the AEDC is the petitioner. The
respondents in Civil Case No. 66213 are the DOTC Secretary and the PBAC
Chairman and members. The respondents in the instant Petition are the DOTC,
the DOTC Secretary, and the Manila International Airport Authority (MIAA). While it
may be conceded that MIAA was not a respondent and did not participate in Civil
Case No. 66213, it may be considered a successor-in-interest of the PBAC. When
Civil Case No. 66213 was initiated, PBAC was then in charge of the NAIA IPT III
Project, and had the authority to evaluate the bids and award the project to the one
offering the lowest or most advantageous bid. Since the bidding is already over,
and the structures comprising NAIA IPT III are now built, then MIAA has taken
charge thereof. Furthermore, it is clear that it has been the intention of the AEDC
to name as respondents in their two Petitions the government agency/ies and
official/s who, at the moment each Petition was filed, had authority over the NAIA
IPT III Project.
There is an identity of subject matter because the two Petitions involve none other
than the award and implementation of the NAIA IPT III Project.
There is an identity of cause of action because, in both Petitions, AEDC is
asserting the violation of its right to the award of the NAIA IPT III Project as the
original proponent in the absence of any other qualified bidders. As early as in Civil
Case No. 66213, AEDC already sought a declaration by the court of the absence
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of any other qualified proponent submitting a competitive bid for the NAIA IPT III
Project, which, ultimately, would result in the award of the said project to it.
AEDC attempts to evade the effects of its compromise agreement by alleging that
it was compelled to enter into such an agreement when former President Joseph
E. Estrada asserted his influence and intervened in Civil Case No. 66213. This
allegation deserves scant consideration. Without any proof that such events did
take place, such statements remain mere allegations that cannot be given weight.
One who alleges any defect or the lack of a valid consent to a contract must
establish the same by full, clear and convincing evidence, not merely by
preponderance thereof.52 And, even assuming arguendo, that the consent of
AEDC to the compromise agreement was indeed vitiated, then President Estrada
was removed from office in January 2001. AEDC filed the present Petition only on
20 October 2005. The four-year prescriptive period, within which an action to annul
a voidable contract may be brought, had already expired.53
The AEDC further claims that the DOTC committed fraud when, without AEDC's
knowledge, the DOTC entered into an Amended and Restated Concession
Agreement (ARCA) with PIATCO. The fraud on the part of the DOTC purportedly
also vitiated AEDC's consent to the compromise agreement. It is true that a judicial
compromise may be set aside if fraud vitiated the consent of a party thereof; and
that the extrinsic fraud, which nullifies a compromise, likewise invalidates the
decision approving it.54 However, once again, AEDC's allegations of fraud are
unsubstantiated. There is no proof that the DOTC and PIATCO willfully and
deliberately suppressed and kept the information on the execution of the ARCA
from AEDC. The burden of proving that there indeed was fraud lies with the party
making such allegation. Each party must prove his own affirmative allegations. The
burden of proof lies on the party who would be defeated if no evidence were given
on either side. In this jurisdiction, fraud is never presumed.55
Moreover, a judicial compromise may be rescinded or set aside on the ground of
fraud in accordance with Rule 38 of the Rules on Civil Procedure on petition for
relief from judgment. Section 3 thereof prescribes the periods within which the
petition for relief must be filed:
SEC. 3. Time for filing petition; contents and verification.– A petition
provided for in either of the preceding sections of this Rule must be
verified, filed within sixty (60) days after the petitioner learns of the
judgment, final order or other proceeding to be set aside, and not more
than six (6) months after such judgment or final order was entered, or such
proceeding was taken, and must be accompanied with affidavits showing
the fraud, accident, mistake or excusable negligence relied upon, and the
facts constituting the petitioner's good and substantial cause of action or
defense, as the case may be.
According to this Court's ruling in Argana v. Republic,56 as applied to a judgment
based on compromise, both the 60-day and six-month reglementary periods within
which to file a petition for relief should be reckoned from the date when the
decision approving the compromise agreement was rendered because such
judgment is considered immediately executory and entered on the date that it was
approved by the court. In the present case, the Order of the RTC of Pasig City
granting the Joint Motion to Dismiss filed by the parties in Civil Case No. 66213
was issued on 30 April 1999, yet AEDC only spoke of the alleged fraud which
vitiated its consent thereto in its Petition before this Court filed on 20 October
2005, more than six years later.
It is obvious that the assertion by AEDC of its vitiated consent to the Joint Motion
to Dismiss Civil Case No. 66213 is nothing more than an after-thought and a
desperate attempt to escape the legal implications thereof, including the barring of
its present Petition on the ground of res judicata.
It is also irrelevant to the legal position of AEDC that the Government asserted
in Agan that the award of the NAIA IPT III Project to PIATCO was void. That the
Government eventually took such a position, which this Court subsequently
upheld, does not affect AEDC's commitments and obligations under its judicially-
approved compromise agreement in Civil Case No. 66213, which AEDC signed
willingly, knowingly, and ably assisted by legal counsel.
In addition, it cannot be said that there has been a fundamental change in the
Government's position since Civil Case No. 66213, contrary to the allegation of
AEDC. The Government then espoused that AEDC is not entitled to the award of
the NAIA IPT III Project. The Government still maintains the exact same position
presently. That the Government eventually reversed its position on the validity of
its award of the project to PIATCO is not inconsistent with its position that neither
should AEDC be awarded the project.
For the foregoing substantive and procedural reasons, the instant Petition of AEDC
should be dismissed.
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Republic of the Philippines v. Court of Appeals and Baterina (G.R. No.
174166)
As mentioned in Gingoyon, expropriation proceedings for the NAIA IPT III was
instituted by the Government with the RTC of Pasay City, docketed as Case No.
04-0876CFM. Congressman Baterina, together with other members of the House
of Representatives, sought intervention in Case No. 04-0876CFM by filing a
Petition for Prohibition in Intervention (with Application for Temporary Restraining
Order and Writ of Preliminary Injunction). Baterina, et al. believe that the
Government need not file expropriation proceedings to gain possession of NAIA
IPT III and that PIATCO is not entitled to payment of just compensation, arguing
thus –
A) Respondent PIATCO does not own Terminal III because BOT
Contracts do not vest ownership in PIATCO. As such, neither PIATCO nor
FRAPORT are entitled to compensation.
B) Articles 448, ET SEQ., of the New Civil Code, as regards builders in
good faith/bad faith, do not apply to PIATCO's Construction of Terminal III.
C) Article 1412(2) of the New Civil Code allows the Government to
demand the return of what it has given without any obligation to comply
with its promise.
D) The payment of compensation to PIATCO is unconstitutional, violative
of the Build-Operate-Transfer Law, and violates the Civil Code and other
laws. 57
On 27 October 2005, the RTC of Pasay City issued an Order admitting the Petition
in Intervention of Baterina, et al., as well as the Complaint in Intervention of
Manuel L. Fortes, Jr. and the Answer in Intervention of Gina B. Alnas, et al. The
Republic sought reconsideration of the 27 October 2005 Order of the RTC of
Pasay City, which, in an Omnibus Order dated 13 December 2005, was denied by
the RTC of Pasay City as regards the intervention of Baterina, et al. and Fortes,
but granted as to the intervention of Alnas, et al. On 22 March 2006, Baterina, et
al. filed with the RTC of Pasay City a Motion to Declare in Default and/or Motion for
Summary Judgment considering that the Republic and PIATCO failed to file an
answer or any responsive pleading to their Petition for Prohibition in Intervention.
In the meantime, on 19 December 2005, the Court's Decision in Gingoyon was
promulgated. Baterina also filed a Motion for Intervention in said case and sought
reconsideration of the Decision therein. However, his Motion for Intervention was
denied by this Court in a Resolution dated 1 February 2006.
On 27 March 2006, the RTC of Pasay City issued an Order and Writ of Execution,
the dispositive portion of which reads –
WHEREFORE, let a writ of execution be issued in this case directing the
Sheriff of this court to immediately implement the Order dated January 4,
2005 and January 10, 2005, as affirmed by the Decision of the Supreme
Court in G.R. No. 166429 in the above-entitled case dated December 19,
2005, in the following manner:
1. Ordering the General Manager, the Senior Assistant General Manager
and the Vice President of Finance of the Manila International Airport
Authority (MIAA) to immediately withdraw the amount
of P3,002,125,000.00 from the above-mentioned Certificates of US Dollar
Time Deposits with the Land Bank of the Philippines, Baclaran Branch;
2. Ordering the Branch Manager, Land Bank of the Philippines, Baclaran
Branch to immediately release the sum of P3,002,125,000.00 to PIATCO;
Return of Service of the Writs shall be made by the Sheriff of this court
immediately thereafter;58
The RTC of Pasay City, in an Order, dated 15 June 2006, denied the Motions for
Reconsideration of its Order and Writ of Execution filed by the Government and
Fortes. Baterina, meanwhile, went before the Court of Appeals via a Petition
for Certiorari and Prohibition (With Urgent Prayer for the Issuance of a Temporary
Restraining Order and Writ of Preliminary Injunction), docketed as CA-G.R. No.
95539, assailing the issuance, in grave abuse of discretion, by the RTC of Pasay
City of its Orders dated 27 March 2006 and 15 June 2006 and Writ of Execution
dated 27 March 2006.
During the pendency of CA-G.R. No. 95539 with the Court of Appeals, the RTC of
Pasay City issued an Order, dated 7 August 2006, denying the Urgent
Manifestation and Motion filed by the Republic in which it relayed willingness to
comply with the Order and Writ of Execution dated 27 March 2006, provided that
the trial court shall issue an Order expressly authorizing the Republic to award
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concessions and lease portions of the NAIA IPT III to potential users. The following B. THE TRO IS IN DIRECT CONTRAVENTION OF THIS
day, on 8 August 2006, the RTC of Pasay City issued an Order denying the COURT'S DECISION WICH HAD ATTAINED FINALITY.
intervention of Baterina, et al. and Fortes in Case No. 04-0876CFM. In a third
Order, dated 9 August 2006, the RTC of Pasay City directed PIATCO to receive II
the amount of P3,002,125,000.00 from the Land Bank of the Philippines, Baclaran
Branch.
THE REPUBLIC IS SUFFERING IRREPARABLE DAMAGE.

By 24 August 2006, the Republic was all set to comply with the 9 August 2006 III
Order of the RTC of Pasay City. Hence, the representatives of the Republic and
PIATCO met before the RTC of Pasay City for the supposed payment by the
former to the latter of the proferred amount. However, on the same day, the Court THE COURT OF APPEALS MUST BE PROHIBITED FROM GIVING DUE
of Appeals, in CA G.R. No. 95539, issued a Temporary Restraining Order (TRO) COURSE TO A PETITION THAT IS DEFECTIVE IN FORM AND
enjoining, among other things, the RTC of Pasay City from implementing the SUBSTANCE.
questioned Orders, dated 27 March 2006 and 15 June 2006, or "from otherwise
causing payment and from further proceeding with the determination of just A. PRIVATE RESPONDENT HAS NO LEGAL STANDING.
compensation in the expropriation case involved herein, until such time that
petitioner's motion to declare in default and motion for partial summary judgment 1. THIS HONORABLE COURT HAS RULED THAT
shall have been resolved by the trial court; or it is clarified that PIATCO PRIVATE RESPONDENT HAS NO LEGAL STANDING.
categorically disputes the proferred value for NAIA Terminal 3." The TRO was to
be effective for 30 days. Two days later, on 26 August 2006, the Republic filed with 2. PRIVATE RESPONDENT HAS LOST HIS STANDING
the Court of Appeals an Urgent Motion to Lift Temporary Restraining Order, which AS AN INTERVENOR.
the appellate court scheduled for hearing on 5 September 2006.
B. PRIVATE RESPONDENT FAILED TO DEMONSTRATE THAT
While the Urgent Motion to lift the TRO was still pending with the Court of Appeals, HE IS ENTITLED TO THE INJUNCTIVE RELIEFS PRAYED FOR.
the Republic already filed the present Petition for Certiorari and Prohibition With
Urgent Application for a Temporary Restraining Order and/or Writ of Preliminary
C. THE BOND POSTED IS INSUFFICIENT.
Injunction, attributing to the Court of Appeals grave abuse of discretion in granting
the TRO and seeking a writ of prohibition against the Court of Appeals to enjoin it
from giving due course to Baterina's Petition in CA-G.R. No. 95539. The Republic IV
thus raises before this Court the following arguments:
GRANTING ARGUENDO THAT PRIVATE RESPONDENT'S PETITION IS
I SUFFICIENT IN FORM AND SUBSTANCE, THE SAME HAS BECOME
MOOT AND ACADEMIC.
THE COURT OF APPEALS COMMITTED GRAVE ABUSE OF
DISCRETION AMOUNTING TO AN EXCESS OR LACK OF A. THE MOTION TO DECLARE IN DEFAULT AND/OR MOTION
JURISDICTION WHEN IT GRANTED THE TEMPORARY RESTRAINING FOR PARTIAL SUMMARY JUDGMENT HAS ALREADY BEEN
ORDER. RESOLVED.

A. THIS HONORABLE COURT'S DECISION IN GINGOYON B. PIATCO HAS CATEGORICALLY DISPUTED THE
CONSTITUTES THE "LAW OF THE CASE". PROFFERED VALUE FOR NAIA TERMINAL III.59

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The Republic prays of this Court that:
(a) Pending the determination of the merits of this petition, a temporary
restraining order and/or a writ of preliminary injunction be ISSUED
restraining the Court of Appeals from implementing the writ of preliminary
injunction in CA-G.R. SP No. 95539 and proceeding in said case such as
hearing it on September 5, 2006. After both parties have been heard, the
preliminary injunction be MADE PERMANENT;
(b) The Resolution date 24 August 2006 of the Court of Appeals be SET
ASIDE; and
(c) CA-G.R. SP No. 95539 be ORDERED DISMISSED.
Other just and equitable reliefs are likewise prayed for.60
On 4 September 2006, the Republic filed a Manifestation and Motion to Withdraw
Urgent Motion to Lift Temporary Restraining Order with the Court of Appeals
stating, among other things, that it had decided to withdraw the said Motion as it
had opted to avail of other options and remedies. Despite the Motion to Withdraw
filed by the Government, the Court of Appeals issued a Resolution, dated 8
September 2006, lifting the TRO it issued, on the basis of the following –
In view of the pronouncement of the Supreme Court in the Gingoyon case
upholding the right of PIATCO to be paid the proferred value in the amount
of P3,002,125,000.00 prior to the implementation of the writ of possession
issued by the trial court on December 21, 2004 over the NAIA Passenger
Terminal III, and directing the determination of just compensation, there is
no practical and logical reason to maintain the effects of the Temporary
Restraining Order contained in our Resolution dated August 24, 2006.
Thus, We cannot continue restraining what has been mandated in a final
and executory decision of the Supreme Court.
WHEREFORE, Our Resolution dated 24 August 2006 be SET ASIDE.
Consequently, the Motion to Withdraw the Motion to Lift the Temporary
Restraining Order is rendered moot and academic.61
There being no more legal impediment, the Republic tendered on 11 September
2006 Land Bank check in the amount of P3,002,125,000.00 representing the
proferred value of NAIA IPT III, which was received by a duly authorized
representative of PIATCO.
On 27 December 2006, the Court of Appeals rendered a Decision in CA G.R. No.
95539 dismissing Baterina's Petition.
The latest developments before the Court of Appeals and the RTC of Pasay City
render the present Petition of the Republic moot.
Nonetheless, Baterina, as the private respondent in the instant Petition, presented
his own prayer that a judgment be rendered as follows:
A. For this Honorable Court, in the exercise of its judicial discretion to relax
procedural rules consistent with Metropolitan Traffic Command v.
Gonong and deem that justice would be better served if all legal
issuesinvolved in the expropriation case and in Baterina are resolved in
this case once and for all, to DECLAREthat:
i. TERMINAL 3, as a matter of law, is public property and thus not
a proper object of eminent domain proceedings; and
ii. PIATCO, as a matter of law, is merely the builder of TERMINAL
3 and, as such, it may file a claim for recovery on quantum
meruit with the Commission on Audi[t] for determination of the
amount thereof, if any.
B. To DIRECT the Regional Trial Court of Pasay City, Branch 117 to
dismiss the expropriation case;
C. To DISMISS the instant Petition and DENY The Republic's application
for TRO and/or writ of preliminary injunction for lack of merit;
D. To DECLARE that the P3 Billion (representing the proferred value of
TERMINAL 3) paid to PIATCO on 11 September 2006 as funds held in
trust by PIATCO for the benefit of the Republic and subject to the
outcome of the proceedings for the determination of recovery on quantum
meruit due to PIATCO, if any.
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 E. To DIRECT the Solicitor General to disclose the evidence it has
gathered on corruption, bribery, fraud, bad faith, etc., to this Honorable
Court and the Commission on Audit, and to DECLARE such evidence to
be admissible in any proceeding for the determination of any
compensation due to PIATCO, if any.
[F]. In the alternative, to:
i. SET ASIDE the trial court's Order dated 08 August 2006 denying
Private Respondent's motion for intervention in the expropriation
case, and
ii. Should this Honorable Court lend credence to the argument of
the Solicitor General in its Commentdated 20 April 2006 that
"there are issues as to material fact that require presentation of
evidence", to REMAND the resolution of the legal issues raised by
Private Respondent to the trial court consistent with this
Honorable Court's holding in the Gingoyon Resolution that "the
interests of the movants-in-intervention [meaning Takenaka,
Asahikosan, and herein Private Respondent] may be duly
litigated in proceedings which are extant before the lower
courts."62
In essence, Baterina is opposing the expropriation proceedings on the ground that
NAIA IPT III is already public property. Hence, PIATCO is not entitled to just
compensation for NAIA IPT III. He is asking the Court to make a definitive ruling on
this matter considering that it was not settled in either Agan or Gingoyon.
We disagree. Contrary to Baterina's stance, PIATCO's entitlement to just and
equitable consideration for its construction of NAIA IPT III and the propriety of the
Republic's resort to expropriation proceedings were already recognized and
upheld by this Court in Agan and Gingoyon.
The Court's Decisions in both Agan and Gingoyon had attained finality, the former
on 17 February 2004 and the latter on 17 March 2006.
This Court already made an unequivocal pronouncement in its Resolution dated 21
January 2004 in Agan that for the Government of the Republic to take over the
NAIA IPT III facility, it has to compensate PIATCO as a builder of the structures;
and that "[t]he compensation must be just and in accordance with law and equity
for the government cannot unjustly enrich itself at the expense of PIATCO and its
investors."63 As between the Republic and PIATCO, the judgment on the need to
compensate PIATCO before the Government may take over NAIA IPT III is already
conclusive and beyond question.
Hence, in Gingoyon, this Court declared that:
This pronouncement contains the fundamental premises which permeate
this decision of the Court. Indeed, Agan, final and executory as it is, stands
as governing law in this case, and any disposition of the present petition
must conform to the conditions laid down by the Court in its
2004 Resolution.
xxxx
The pronouncement in the 2004 Resolution is especially significant
to this case in two aspects, namely: (i) that PIATCO must receive
payment of just compensation determined in accordance with law
and equity; and (ii) that the government is barred from taking over
NAIA 3 until such just compensation is paid. The parties cannot be
allowed to evade the directives laid down by this Court through any mode
of judicial action, such as the complaint for eminent domain.
It cannot be denied though that the Court in the 2004 Resolution
prescribed mandatory guidelines which the Government must observe
before it could acquire the NAIA 3 facilities. Thus, the actions of
respondent judge under review, as well as the arguments of the parties
must, to merit affirmation, pass the threshold test of whether such
propositions are in accord with the 2004 Resolution.64
The Court then, in Gingoyon, directly addressed the issue on the appropriateness
of the Republic's resort to expropriation proceedings:
The Government has chosen to resort to expropriation, a remedy
available under the law, which has the added benefit of an integrated
process for the determination of just compensation and the payment
thereof to PIATCO. We appreciate that the case at bar is a highly
unusual case, whereby the Government seeks to expropriate a building
complex constructed on land which the State already owns. There is an
inherent illogic in the resort to eminent domain on property already owned
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by the State. At first blush, since the State already owns the property on
which NAIA 3 stands, the proper remedy should be akin to an action for
ejectment.
However, the reason for the resort by the Government to
expropriation proceedings is understandable in this case. The 2004
Resolution, in requiring the payment of just compensation prior to the
takeover by the Government of NAIA 3, effectively precluded it from
acquiring possession or ownership of the NAIA 3 through the unilateral
exercise of its rights as the owner of the ground on which the facilities
stood. Thus, as things stood after the 2004 Resolution, the right of the
Government to take over the NAIA 3 terminal was preconditioned by lawful
order on the payment of just compensation to PIATCO as builder of the
structures.
xxxx
The right of eminent domain extends to personal and real property, and
the NAIA 3 structures, adhered as they are to the soil, are considered as
real property. The public purpose for the expropriation is also beyond
dispute. It should also be noted that Section 1 of Rule 67 (on
Expropriation) recognizes the possibility that the property sought to
be expropriated may be titled in the name of the Republic of the
Philippines, although occupied by private individuals, and in such
case an averment to that effect should be made in the complaint. The
instant expropriation complaint did aver that the NAIA 3 complex "stands
on a parcel of land owned by the Bases Conversion Development
Authority, another agency of [the Republic of the Philippines]."
Admittedly, eminent domain is not the sole judicial recourse by which
the Government may have acquired the NAIA 3 facilities while satisfying
the requisites in the 2004 Resolution. Eminent domain though may be
the most effective, as well as the speediest means by which such
goals may be accomplished. Not only does it enable immediate
possession after satisfaction of the requisites under the law, it also has a
built-in procedure through which just compensation may be ascertained.
Thus, there should be no question as to the propriety of eminent domain
proceedings in this case.
Still, in applying the laws and rules on expropriation in the case at bar, we
are impelled to apply or construe these rules in accordance with the
Court's prescriptions in the 2004 Resolution to achieve the end effect that
the Government may validly take over the NAIA 3 facilities. Insofar as this
case is concerned, the 2004 Resolution is effective not only as a legal
precedent, but as the source of rights and prescriptions that must be
guaranteed, if not enforced, in the resolution of this petition. Otherwise, the
integrity and efficacy of the rulings of this Court will be severely
diminished.65 (Emphasis ours.)
The Court, also in Gingoyon, categorically recognized PIATCO's ownership over
the structures it had built in NAIA IPT III, to wit:
There can be no doubt that PIATCO has ownership rights over the
facilities which it had financed and constructed. The 2004 Resolution
squarely recognized that right when it mandated the payment of just
compensation to PIATCO prior to the takeover by the Government of NAIA
3. The fact that the Government resorted to eminent domain proceedings
in the first place is a concession on its part of PIATCO's ownership.
Indeed, if no such right is recognized, then there should be no impediment
for the Government to seize control of NAIA 3 through ordinary ejectment
proceedings.
xxxx
Thus, the property subject of expropriation, the NAIA 3 facilities, are
real property owned by PIATCO. x x x (Emphasis ours.)66
It was further settled in Gingoyon that the expropriation proceedings shall be held
in accordance with Republic Act No. 8974,67 thus:
Unlike in the case of Rule 67, the application of Rep. Act No. 8974 will not
contravene the 2004 Resolution, which requires the payment of just
compensation before any takeover of the NAIA 3 facilities by the
Government. The 2004 Resolution does not particularize the extent such
payment must be effected before the takeover, but it unquestionably
requires at least some degree of payment to the private property owner
before a writ of possession may issue. The utilization of Rep. Act No. 8974
guarantees compliance with this bare minimum requirement, as it assures
the private property owner the payment of, at the very least, the proffered
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 value of the property to be seized. Such payment of the proffered value to
the owner, followed by the issuance of the writ of possession in favor of
the Government, is precisely the schematic under Rep. Act No. 8974, one
which facially complies with the prescription laid down in the 2004
Resolution.
And finally, as to the determination of the amount due PIATCO, this Court ruled
in Gingoyon that:
Under Rep. Act No. 8974, the Government is required to "immediately
pay" the owner of the property the amount equivalent to the sum of (1) one
hundred percent (100%) of the value of the property based on the current
relevant zonal valuation of the [BIR]; and (2) the value of the
improvements and/or structures as determined under Section 7. As stated
above, the BIR zonal valuation cannot apply in this case, thus the amount
subject to immediate payment should be limited to "the value of the
improvements and/or structures as determined under Section 7," with
Section 7 referring to the "implementing rules and regulations for the
equitable valuation of the improvements and/or structures on the land."
Under the present implementing rules in place, the valuation of the
improvements/structures are to be based using "the replacement cost
method." However, the replacement cost is only one of the factors to be
considered in determining the just compensation.
In addition to Rep. Act No. 8974, the 2004 Resolution in Agan also
mandated that the payment of just compensation should be in
accordance with equity as well. Thus, in ascertaining the ultimate
amount of just compensation, the duty of the trial court is to ensure that
such amount conforms not only to the law, such as Rep. Act No. 8974, but
to principles of equity as well.
Admittedly, there is no way, at least for the present, to immediately
ascertain the value of the improvements and structures since such
valuation is a matter for factual determination. Yet Rep. Act No. 8974
permits an expedited means by which the Government can immediately
take possession of the property without having to await precise
determination of the valuation. Section 4(c) of Rep. Act No. 8974 states
that "in case the completion of a government infrastructure project is of
utmost urgency and importance, and there is no existing valuation of
the area concerned, the implementing agency shall immediately pay the
owner of the property its proferred value, taking into consideration the
standards prescribed in Section 5 [of the law]." The "proffered value" may
strike as a highly subjective standard based solely on the intuition of the
government, but Rep. Act No. 8974 does provide relevant standards by
which "proffered value" should be based, as well as the certainty of judicial
determination of the propriety of the proffered value.
In filing the complaint for expropriation, the Government alleged to have
deposited the amount of P3 Billion earmarked for expropriation,
representing the assessed value of the property. The making of the
deposit, including the determination of the amount of the deposit, was
undertaken under the erroneous notion that Rule 67, and not Rep. Act No.
8974, is the applicable law. Still, as regards the amount, the Court sees no
impediment to recognize this sum of P3 Billion as the proffered value
under Section 4(b) of Rep. Act No. 8974. After all, in the initial
determination of the proffered value, the Government is not strictly
required to adhere to any predetermined standards, although its proffered
value may later be subjected to judicial review using the standards
enumerated under Section 5 of Rep. Act No. 8974.68
Gingoyon constitutes as the law of the case for the expropriation proceedings,
docketed as Case No. 04-0876CFM, before the RTC of Pasay City. Law of the
case has been defined in the following manner –
By "law of the case" is meant that "whatever is once irrevocably
established as the controlling legal rule or decision between the same
parties in the same case continues to be the law of the case" so long as
the "facts on which such decision was predicated continue to be the facts
of the case before the court" (21 C.J.S. 330). And once the decision
becomes final, it is binding on all inferior courts and hence beyond their
power and authority to alter or modify (Kabigting vs. Acting Director of
Prisons, G.R. L-15548, October 30, 1962).69
A ruling rendered on the first appeal, constitutes the law of the case, and, even if
erroneous, it may no longer be disturbed or modified since it has become final long
ago.70
The extensive excerpts from Gingoyon demonstrate and emphasize that the Court
had already adjudged the issues raised by Baterina, which he either conveniently
overlooked or stubbornly refused to accept.
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The general rule precluding the relitigation of material facts or questions which
were in issue and adjudicated in former action are commonly applied to all matters
essentially connected with the subject matter of the litigation. Thus, it extends to
questions necessarily involved in an issue, and necessarily adjudicated, or
necessarily implied in the final judgment, although no specific finding may have
been made in reference thereto, and although such matters were directly referred
to in the pleadings and were not actually or formally presented. Under this rule, if
the record of the former trial shows that the judgment could not have been
rendered without deciding the particular matter, it will be considered as having
settled that matter as to all future actions between the parties and if a judgment
necessarily presupposes certain premises, they are as conclusive as the
judgment itself. Reasons for the rule are that a judgment is an adjudication on all
the matters which are essential to support it, and that every proposition assumed
or decided by the court leading up to the final conclusion and upon which such
conclusion is based is as effectually passed upon as the ultimate question which is
finally solved.71
Since the issues Baterina wishes to raise as an intervenor in Case No. 04-
0876CFM were already settled with finality in both Agan and Gingoyon, then there
is no point in still allowing his intervention. His Petition-in-Intervention would only
be a relitigation of matters that had been previously adjudicated by no less than
the Highest Court of the land. And, in no manner can the RTC of Pasay City in
Case No. 04-0876CFM grant the reliefs he prayed for without departing from or
running afoul of the final and executory Decisions of this Court
in Agan and Gingoyon.
While it is true that when this Court, in a Resolution dated 1 February 2006,
dismissed the Motions for Intervention in Gingoyon, including that of Baterina, it
also observed that the interests of the movants-in-intervention may be duly
litigated in proceedings which are extant before the lower courts. This does not
mean, however, that the said movants-in-interest were assured of being allowed
as intervenors or that the reliefs they sought as such shall be granted by the trial
courts. The fate of their intervention still rests on their interest or legal standing in
the case and the merits of their arguments.
WHEREFORE, in view of the foregoing:
a. The Petition in G.R. No. 169914 is hereby DISMISSED for lack of merit; and
b. The Petition in G.R. No. 174166 is hereby likewise DISMISSED for being moot
and academic.
No costs.
SO ORDERED.
G.R. No. 189239 November 24, 2010
SPOUSES LETICIA & JOSE ERVIN ABAD, SPS. ROSARIO AND ERWIN
COLLANTES, SPS. RICARDO AND FELITA ANN, SPS. ELSIE AND ROGER
LAS PIÑAS, LINDA LAYDA, RESTITUTO MARIANO, SPS. ARNOLD AND
MIRIAM MERCINES, SPS. LUCITA AND WENCESLAO A. RAPACON, SPS.
ROMEO AND EMILYN HULLEZA, LUZ MIPANTAO, SPS. HELEN AND
ANTHONY TEVES, MARLENE TUAZON, SPS. ZALDO AND MIA SALES, SPS.
JOSEFINA AND JOEL YBERA, SPS. LINDA AND JESSIE CABATUAN, SPS.
WILMA AND MARIO ANDRADA, SPS. RAYMUNDO AND ARSENIA LELIS,
FREDY AND SUSANA PILONEO, Petitioners,
vs.
FIL-HOMES REALTY and DEVELOPMENT CORPORATION and MAGDIWANG
REALTY CORPORATION,Respondents.
DECISION
CARPIO MORALES, J.:
Fil-Homes Realty and Development Corporation and Magdiwang Realty
Corporation (respondents), co-owners of two lots situated in Sucat, Parañaque
City and covered by Transfer Certificates of Title Nos. 21712 and 21713, filed a
complaint for unlawful detainer on May 7, 2003 against above-named petitioners
before the Parañaque Metropolitan Trial Court (MeTC).
Respondents alleged that petitioners, through tolerance, had occupied the subject
lots since 1980 but ignored their repeated demands to vacate them.
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Petitioners countered that there is no possession by tolerance for they have been
in adverse, continuous and uninterrupted possession of the lots for more than 30
years; and that respondent’s predecessor-in-interest, Pilipinas Development
Corporation, had no title to the lots. In any event, they contend that the question of
ownership must first be settled before the issue of possession may be resolved.
During the pendency of the case or on June 30, 2004, the City of Parañaque filed
expropriation proceedings covering the lots before the Regional Trial Court of
Parañaque with the intention of establishing a socialized housing project therein for
distribution to the occupants including petitioners. A writ of possession was
consequently issued and a Certificate of Turn-over given to the City.
Branch 77 of the MeTC, by Decision of March 3, 2008, rendered judgment in the
unlawful detainer case against petitioners, disposing as follows:
WHEREFORE, judgment is hereby rendered in favor of the plaintiff and
against the defendants Leticia and Ervin Abad et. als. ordering the latter and all
persons claiming rights under them to VACATE and SURRENDERpossession of
the premises (Lots covered by TCT NOS. (71065) 21712 and (71066) 21713
otherwise known as Purok I Silverio Compound, Barangay San Isidro, Parañaque
City to plaintiff and to PAY the said plaintiff as follows:
1. The reasonable compensation in the amount of ₱20,000.00 a month
commencing November 20, 2002 and every month thereafter until the
defendants shall have finally vacated the premises and surrender peaceful
possession thereof to the plaintiff;
2. ₱20,000.00 as and for attorney’s fees, and finally
3. Costs of suit.
SO ORDERED.1 (emphasis in the original)
The MeTC held that as no payment had been made to respondents for the lots,
they still maintain ownership thereon. It added that petitioners cannot claim a
better right by virtue of the issuance of a Writ of Possession for the project
beneficiaries have yet to be named.
On appeal, the Regional Trial Court (RTC), by Decision of September 4,
2008,2 reversed the MeTC decision and dismissed respondents’ complaint in this
wise:
x x x The court a quo ruled that the case filed by plaintiffs (respondents herein) is
unlawful detainer as shown by the allegations of the Complaint. The ruling of the
court a quo is not accurate. It is not the allegations of the Complaint that finally
determine whether a case is unlawful detainer, rather it is the evidence in the
case.
Unlawful detainer requires the significant element of "tolerance". Tolerance of the
occupation of the property must be present right from the start of the defendants’
possession. The phrase "from the start of defendants’ possession" is
significant. When there is no "tolerance" right from the start of the
possession sought to be recovered, the case of unlawful detainer will not
prosper.3 (emphasis in the original; underscoring supplied)
The RTC went on to rule that the issuance of a writ of possession in favor of the
City bars the continuation of the unlawful detainer proceedings, and since the
judgment had already been rendered in the expropriation proceedings which
effectively turned over the lots to the City, the MeTC has no jurisdiction to
"disregard the . . . final judgment and writ of possession" due to non-payment of
just compensation:
The Writ of Possession shows that possession over the properties subject of this
case had already been given to the City of Parañaque since January 19, 2006
after they were expropriated. It is serious error for the court a quo to rule in the
unlawful detainer case that Magdiwang Realty Corporation and Fil-Homes
Realty and Development Corporation could still be given possession of the
properties which were already expropriated in favor of the City of Parañaque.
There is also another serious lapse in the ruling of the court a quo that the case for
expropriation in the Regional Trial Court would not bar, suspend or abate the
ejectment proceedings. The court a quo had failed to consider the fact that the
case for expropriation was already decided by the Regional Trial Court, Branch
196 way back in the year 2006 or 2 years before the court a quo rendered its
judgment in the unlawful detainer case in the year 2008. In fact, there was already
a Writ of Possession way back in the year 1996 (sic) issued in the expropriation
case by the Regional Trial Court, Branch 196. The court a quo has no valid
reason to disregard the said final judgment and the writ of possession
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already issued by the Regional Trial Court in favor of the City of Parañaque
and against Magdiwang Realty Corporation and Fil-Homes Realty
Development Corporation and make another judgment concerning
possession of the subject properties contrary to the final judgment of the
Regional Trial Court, Branch 196.4 (emphasis in the original)
Before the Court of Appeals where respondents filed a petition for review, they
maintained that respondents’ "act of allowing several years to pass without
requiring [them] to vacate nor filing an ejectment case against them amounts to
acquiescence or tolerance of their possession."5
By Decision of May 27, 2009,6 the appellate court, noting that petitioners did not
present evidence to rebut respondents’ allegation of possession by tolerance, and
considering petitioners’ admission that they commenced occupation of the property
without the permission of the previous owner ─ Pilipinas Development Corporation
─ as indicium of tolerance by respondents’ predecessor-in-interest, ruled in favor
of respondents. Held the appellate court:
Where the defendant’s entry upon the land was with plaintiff’s tolerance from the
date and fact of entry, unlawful detainer proceedings may be instituted within one
year from the demand on him to vacate upon demand. The status of such
defendant is analogous to that of a tenant or lessee, the term of whose lease, has
expired but whose occupancy is continued by the tolerance of the lessor. The
same rule applies where the defendant purchased the house of the former lessee,
who was already in arrears in the payment of rentals, and thereafter occupied the
premises without a new lease contract with the landowner.7
Respecting the issuance of a writ of possession in the expropriation proceedings,
the appellate court, citing Republic v. Gingoyon,8 held the same does not signify
the completion of the expropriation proceedings. Thus it disposed:
WHEREFORE, premises considered, the instant Petition is GRANTED. The
assailed Decision of the Court a quo is REVOKED and SET ASIDE. The Decision
of the Metropolitan Trial Court dated March 3, 2008 is hereby REINSTATED with
MODIFICATION [by] deleting the award for attorney’s fees.
SO ORDERED. (underscoring supplied)
Petitioners’ motion for reconsideration was denied by Resolution dated August 26,
2009, hence, the filing of the present petition for review.
The petition fails.
In the exercise of the power of eminent domain, the State expropriates private
property for public use upon payment of just compensation. A socialized housing
project falls within the ambit of public use as it is in furtherance of the constitutional
provisions on social justice.9
As a general rule, ejectment proceedings, due to its summary nature, are not
suspended or their resolution held in abeyance despite the pendency of a civil
action regarding ownership.
Section 1 of Commonwealth Act No. 53810 enlightens, however:
Section 1. When the Government seeks to acquire, through purchase or
expropriation proceedings, lands belonging to any estate or
chaplaincy (cappellania), any action for ejectment against the tenants occupying
said lands shall be automatically suspended, for such time as may be required by
the expropriation proceedings or the necessary negotiations for the purchase of
the lands, in which latter case, the period of suspension shall not exceed one year.
To avail himself of the benefits of the suspension, the tenants shall pay to the
landowner the current rents as they become due or deposit the same with the
court where the action for ejectment has been instituted. (emphasis and
underscoring supplied)
Petitioners did not comply with any of the acts mentioned in the law to avail of the
benefits of the suspension. They nevertheless posit that since the lots are the
subject of expropriation proceedings, respondents can no longer assert a better
right of possession; and that the City Ordinance authorizing the initiation of
expropriation proceedings designated them as beneficiaries of the lots, hence,
they are entitled to continue staying there.
Petitioners’ position does not lie.
The exercise of expropriation by a local government unit is covered by Section 19
of the Local Government Code (LGC):
SEC. 19. Eminent Domain. – A local government unit may, through its chief
executive and acting pursuant to an ordinance, exercise the power of eminent
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domain for public use, or purpose, or welfare for the benefit of the poor and the
landless, upon payment of just compensation, pursuant to the provisions of the
Constitution and pertinent laws: Provided, however, That the power of eminent
domain may not be exercised unless a valid and definite offer has been previously
made to the owner, and such offer was not accepted: Provided, further, That the
local government unit may immediately take possession of the property upon the
filing of the expropriation proceedings and upon making a deposit with the proper
court of at least fifteen percent (15%) of the fair market value of the property based
on the current tax declaration of the property to be expropriated: Provided, finally,
That the amount to be paid for the expropriated property shall be determined by
the proper court, based on the fair market value of the property.
Lintag v. National Power Corporation11 clearly outlines the stages of expropriation,
viz:
Expropriation of lands consists of two stages:
The first is concerned with the determination of the authority of the plaintiff to
exercise the power of eminent domain and the propriety of its exercise in the
context of the facts involved in the suit. It ends with an order, if not of dismissal of
the action, "of condemnation declaring that the plaintiff has a lawful right to take
the property sought to be condemned, for the public use or purpose described in
the complaint, upon the payment of just compensation to be determined as of the
date of the filing of the complaint x x x.
The second phase of the eminent domain action is concerned with the
determination by the court of "the just compensation for the property sought to be
taken." This is done by the court with the assistance of not more than three (3)
commissioners x x x .lavvphi1
It is only upon the completion of these two stages that expropriation is said to have
been completed. The process is not complete until payment of just compensation.
Accordingly, the issuance of the writ of possession in this case does not
write finis to the expropriation proceedings. To effectuate the transfer of ownership,
it is necessary for the NPC to pay the property owners the final just
compensation.12 (emphasis and underscoring supplied)
In the present case, the mere issuance of a writ of possession in the expropriation
proceedings did not transfer ownership of the lots in favor of the City. Such
issuance was only the first stage in expropriation. There is even no evidence that
judicial deposit had been made in favor of respondents prior to the City’s
possession of the lots, contrary to Section 19 of the LGC.
Respecting petitioners’ claim that they have been named beneficiaries of the lots,
the city ordinance authorizing the initiation of expropriation proceedings does not
state so.13 Petitioners cannot thus claim any right over the lots on the basis of the
ordinance.
Even if the lots are eventually transferred to the City, it is non sequitur for
petitioners to claim that they are automatically entitled to be beneficiaries thereof.
For certain requirements must be met and complied with before they can be
considered to be beneficiaries.
In another vein, petitioners posit that respondents failed to prove that their
possession is by mere tolerance. This too fails. Apropos is the ruling in Calubayan
v. Pascual:14
In allowing several years to pass without requiring the occupant to vacate the
premises nor filing an action to eject him, plaintiffs have acquiesced to defendant’s
possession and use of the premises. It has been held that a person who occupies
the land of another at the latter’s tolerance or permission, without any contract
between them, is necessarily bound by an implied promise that he will vacate upon
demand, failing which a summary action for ejectment is the proper remedy
against them. The status of the defendant is analogous to that of a lessee or
tenant whose term of lease has expired but whose occupancy continued by
tolerance of the owner. In such a case, the unlawful deprivation or withholding of
possession is to be counted from the date of the demand to vacate. (emphasis and
underscoring supplied)
Respondents bought the lots from Pilipinas Development Corporation in 1983.
They stepped into the shoes of the seller with respect to its relationship with
petitioners. Even if early on respondents made no demand or filed no action
against petitioners to eject them from the lots, they thereby merely maintained the
status quo – allowed petitioners’ possession by tolerance.
WHEREFORE, the petition for review is DENIED.
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G.R. No. 193936 December 11, 2013
NATIONAL POWER CORPORATION, Petitioner,
vs.
YCLA SUGAR DEVELOPMENT CORPORATION, Respondent.
DECISION
REYES, J.:
Before this Court is a petition for review on certiorari1under Rule 45 of the Rules of
Court seeking to annul and set aside the Decision2 dated September 23, 2010 of
the Court of Appeals (CA) in CA-G.R. CV No. 86508, which affirmed with
modification the Decision3 dated May 12, 2005 of the Regional Trial Court (RTC) of
Calapan City, Oriental Mindoro, Branch 40, in Civil Case No. R-4600.
The Facts
Petitioner National Power Corporation (NPC) is a government owned and
controlled corporation created for the purpose of undertaking the development of
hydroelectric power throughout the Philippines. NPC is thus authorized to exercise
the power of eminent domain to carry out the said purpose.4
Respondent YCLA Sugar Development Corporation (YCLA) is the registered
owner of three parcels of land situated in Puerto Galera, Oriental Mindoro, covered
by Transfer Certificates of Title Nos. T-5209, T-21280 and T-78583.
In order to complete its 69 KV Calapan-Mamburao Island Grid Project in Puerto
Galera, Oriental Mindoro, NPC had to construct transmission lines that would
traverse several private properties, including the said parcels of land owned by
YCLA.
Accordingly, on December 2, 1997, NPC filed a Complaint5 for expropriation with
the RTC against YCLA and several other individuals. The NPC sought the
expropriation of a portion of the parcels of land owned by the said defendants for
the acquisition of an easement of right-of-way over areas that would be affected by
the construction of transmission lines. The portion of YCLA’s properties that would
be affected by the construction of NPC’s transmission lines has an aggregate area
of 5,846 square meters.
YCLA filed its Answer6 dated July 9, 1998, alleging that the Complaint should be
dismissed outright due to NPC’s failure to allege the public use for the intended
expropriation of its properties.
On April 30, 1999, the parties moved, inter alia, for the constitution of a Board of
Commissioners to be appointed by the RTC to determine the reasonable amount
of just compensation to be paid by the NPC. Thus, on even date, the RTC issued
an order terminating the pre-trial conference and directing the constitution of a
Board of Commissioners, which would submit a report and recommendation as to
the reasonable amount of just compensation for the properties sought to be
expropriated.
Meanwhile, on June 4, 1999, the RTC, acting on NPC’s urgent ex- parte motion,
issued a writ of possession placing NPC in possession of the properties sought to
be expropriated.
On May 2, 2001, the Board of Commissioners submitted its Report,7 which fixed
the amount of just compensation of the subject properties at ₱500.00 per sq m.
YCLA objected to the amount recommended by the Board of Commissioners,
claiming that the amount of just compensation should be fixed at ₱900.00 per sq m
considering the improvements in their properties.
On October 19, 2001, the RTC issued an Order directing YCLA to submit its
written manifestation, together with supporting documents, on its position on the
proper valuation of the subject properties. NPC was likewise given 15 days to
comment thereon. Trial on the determination of the reasonable amount of just
compensation ensued thereafter.
Consequently, YCLA filed a motion asking the RTC to direct the Board of
Commissioners to conduct an ocular inspection over the subject properties and,
thereafter, amend/revise the Board of Commissioner’s Report dated May 2, 2001.
YCLA’s motion was granted by the RTC on July 25, 2003.
Meanwhile, on November 25, 2002, the RTC rendered a Partial Decision as
regards the amount of just compensation that would be paid by the NPC to the
other defendants.
On September 15, 2003, the Board of Commissioners submitted its second
Report,8 which fixed the just compensation of the subject properties at ₱1,000.00
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per sq m. The Board of Commissioners’ Report dated September 15, 2003, in part,
reads:
The undersigned secured from the office of the Provincial Assessor the actual
appraised value per square meter x x x of the Agricultural Land subject matter of
the case which is [₱11.50] per square meter[.] [H]owever, the prevailing market
value is Five Hundred Pesos ([P]500.00) to One Thousand Five Hundred Pesos
([P]1,500.00) per square meters x x x, per actual sale and opinion value of reliable
persons x x x.
In view thereof, the undersigned is submitting this report to the Honorable Court
that the amount of One Thousand Pesos ([P]1,000.00) per square meter should be
the basis in the computation of the price per square meter of the land subject
matter of the instant case, justified by its location on [a] strategic place and the
consequential damages to the whole properties of the defendants because the
plaintiff occupied the front portion along the highway. 9
On May 12, 2005, the RTC rendered a Decision,10 which adopted the report and
recommendation of the Board of Commissioners, viz:
ACCORDINGLY, judgment is hereby rendered directing the plaintiff National
Power Corporation to pay herein defendant YCLA the total amount of
[P]5,786,000.00 representing the value of the expropriated lands owned by the
said defendant and its 26 molave trees which were cut down to make way for the
plaintiff[’s] project, with legal interest from the time the plaintiff had actually took
possession of the subject properties on 19 April 1999 until full payment has been
made.
SO ORDERED.11
The RTC pointed out that the Board of Commissioner’s Report dated May 2, 2001,
which recommended that the amount of just compensation be fixed at ₱500.00 per
sq m, was arrived at without conducting an ocular inspection of the subject
properties. That, upon YCLA’s request, the Board of Commissioners subsequently
conducted an ocular inspection of the subject properties, which prompted them to
revise their earlier recommendation.
Unperturbed, NPC appealed the RTC Decision dated May 12, 2005 to the CA,
alleging that the RTC erred in relying on the recommendation of the Board of
Commissioners as regards the amount of just compensation. NPC claimed that the
amount of ₱1,000.00 per sq m recommended by the Board of Commissioners as
the reasonable amount of just compensation, which was adopted by the RTC, is
too excessive considering that the subject properties were barren and
undeveloped agricultural lands at the time it instituted the action for expropriation.
On September 23, 2010, the CA rendered the Decision12 which affirmed with
modification the RTC Decision dated May 12, 2005, thus:
WHEREFORE, the assailed Decision is AFFIRMED with the MODIFICATION only
in so far as the value of just compensation for the property involved is
concerned. Resultantly, the herein appellant is ordered to pay YCLA Sugar
Development Corporation the award of [P]900.00 per square meter, as and by way
of just compensation for the expropriated property. Costs against the herein
appellant.
SO ORDERED.13
The CA held that the RTC’s determination of the amount of just compensation was
reasonable notwithstanding that it was merely based on the Report submitted by
the Board of Commissioners. The RTC pointed out that there was no showing that
the said Report was tainted with irregularity, fraud or bias. Nevertheless, the CA
modified the award rendered by the RTC, by fixing the amount of just
compensation to ₱900.00 per sq m instead of ₱1,000.00 per sq m, since YCLA
only sought an award of ₱900.00 per sq m as just compensation for the subject
properties in the proceedings before the RTC.
The Issue
Essentially, the issue presented to the Court for resolution is whether the RTC and
the CA had sufficient basis in arriving at the questioned amount of just
compensation of the subject properties.
The NPC posits that the Board of Commissioners’ Report dated September 15,
2003 lacks factual basis; that both the RTC and the CA erred in giving credence to
the Report dated September 15, 2003 as to the recommended amount of just
compensation for the subject properties. NPC maintains that the amount of
₱900.00 per sq m that was fixed by the CA as just compensation is excessive
considering that the subject properties were barren and undeveloped agricultural
lands at the time it filed the complaint for expropriation. Thus, NPC prayed that the
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Court fix the amount of just compensation for the subject properties at ₱500.00 per
sq m pursuant to the Board of Commissioners’ Report dated May 2, 2001.
On the other hand, YCLA contends that the RTC and the CA aptly relied on the
Board of Commissioners’ Report dated September 15, 2003, pointing out that the
Board of Commissioners was in the best position to determine the amount of just
compensation considering that its members undertook intensive ocular inspection
of the subject properties.
The Court’s Ruling
The petition is partly meritorious.
In expropriation proceedings, just compensation is defined as the full and fair
equivalent of the property taken from its owner by the expropriator. The measure is
not the taker’s gain, but the owner’s loss. The word "just" is used to intensify the
meaning of the word "compensation" and to convey thereby the idea that the
equivalent to be rendered for the property to be taken shall be real, substantial, full
and ample. The constitutional limitation of "just compensation" is considered to be
a sum equivalent to the market value of the property, broadly defined as the price
fixed by the seller in open market in the usual and ordinary course of legal action
and competition; or the fair value of the property; as between one who receives
and one who desires to sell it, fixed at the time of the actual taking by the
government.14
It is settled that the amount of just compensation is to be ascertained as of the time
of the taking, which usually coincides with the commencement of the expropriation
proceedings. Where the institution of the action precedes entry into the property,
the amount of just compensation is to be ascertained as of the time of the filing of
the complaint.15
In this case, in arriving at the amount of just compensation, both the RTC and the
CA relied heavily on the Board of Commissioners’ Report dated September 15,
2003, which, in turn, was arrived at after conducting an ocular inspection of the
subject properties on August 27, 2003. However, the Board of Commissioners’
recommendation as to the amount of just compensation was based on the
prevailing market value of the subject properties in 2003. What escaped the
attention of the lower courts is that the prevailing market value of the subject
properties in 2003 cannot be used to determine the amount of just compensation
considering that the Complaint for expropriation was filed by NPC on December 2,
1997.
Further, the Court notes that the Board of Commissioners, in its Report dated
September 15, 2003, merely alleged that its members arrived at the amount of
₱1,000.00 per sq m as just compensation for the subject properties based on
actual sales, presumably of surrounding parcels of land, and on the opinion of
"reliable persons" that were interviewed. However, the Report dated September
15, 2003 is not supported by any corroborative documents such as sworn
declarations of the "reliable persons" that were supposedly interviewed.
The Court has consistently ruled that just compensation cannot be arrived at
arbitrarily; several factors must be considered such as, but not limited to,
acquisition cost, current market value of like properties, tax value of the
condemned property, its size, shape, and location. But before these factors can be
considered and given weight, the same must be supported by documentary
evidence.16 The amount of just compensation could only be attained by using
reliable and actual data as bases for fixing the value of the condemned property. A
commissioners’ report of land prices which is not based on any documentary
evidence is manifestly hearsay and should be disregarded by the court. 17
Under the Rules of Court, any evidence – whether oral or documentary – is
hearsay if its probative value is not based on the personal knowledge of the
witness, but on that of some other person who is not on the witness stand.18
A commissioners’ report of land prices is considered as evidence in the
determination of the amount of just compensation due the land owner in
expropriation cases. The recommended amount of just compensation contained in
the commissioners’ report of land prices, in turn, is based on various factors such
as the fair market value of the property, the value of like properties. Thus, it
becomes imperative that the commissioners’ report of land prices be supported by
pertinent documents, which impelled the commissioners to arrive at the
recommended amount for the condemned properties, to aid the court in its
determination of the amount of just compensation. Otherwise, the commissioner’s
report becomes hearsay and should thus not be considered by the court.
The trial court, in expropriation cases, may accept or reject, whether in whole or in
part, the report submitted by the Board of Commissioners, which is merely
advisory and recommendatory in character.1âwphi1 It may also recommit the
report or set aside the same and appoint new commissioners.19 In this case, the
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lower courts gave full faith and credence to the Board of Commissioners' Report
dated September 15, 2003 notwithstanding that it was not supported by any
documentary evidence.
Considering that the legal basis for the determination of just compensation for the
subject properties is insufficient, the respective Decisions of the RTC and the CA
should be set aside.
Nevertheless, the Court cannot fix the amount of just compensation for the subject
properties at ₱500.00 per sq m pursuant to the Board of Commissioners' Report
dated May 2, 2001. The said Report suffers from the same infirmity as the Report
dated September 15, 2003 - it is unsupported by any documentary evidence and
its recommendation as regards the amount of just compensation are based on the
prevailing market value of the subject properties in 2001.
WHEREFORE, in consideration of the foregoing disquisitions, the instant petition
is PARTIALLY GRANTED. The Decision dated September 23, 2010 of the Court
of Appeals in CA-G.R. CV No. 86508 and the Decision dated May 12, 2005 of the
Regional Trial Court of Calapan City, Oriental Mindoro, Branch 40, in Civil Case
No. R-4600 are hereby SET ASIDE. This case is remanded to the trial court for the
proper determination of just compensation, in conformity with this Decision.
SO ORDERED.
FORECLOSURE OF REAL ESTATE MORTGAGE
G.R. No. 198800 December 11, 2013
JOSE T. RAMIREZ, Petitioner,
vs.
THE MANILA BANKING CORPORATION, Respondent.
DECISION
VILLARAMA, JR., J.:
We have consistently held that unless the parties stipulate, personal notice to
the mortgagor in extrajudicial foreclosure proceedings is not necessary because
Section 31 of Act No. 31352 only requires the posting of the notice of sale in three
public places and the publication of that notice in a newspaper of general
circulation.3
Before us is a petition for review on certiorari under Rule 45 of the Decision4 dated
November 26, 2010 and Resolution5 dated September 28, 2011 of the Court of
Appeals (CA) in CA-G.R. CV No. 80616.
The facts of the case are as follows:
Petitioner Jose T. Ramirez mortgaged two parcels of land located at
Bayanbayanan, Marikina City and covered by Transfer Certificate of Title (TCT)
Nos. N-107226 and N-230337 in favor of respondent The Manila Banking
Corporation to secure his ₱265,000 loan. The real estate mortgage provides that
all correspondence relative to the mortgage including notifications of extrajudicial
actions shall be sent to petitioner Ramirez at his given address, to wit:
N) All correspondence relative to this MORTGAGE, including demand letters,
summons, subpoenas or notifications of any judicial or extrajudicial actions shall
be sent to the MORTGAGOR at the address given above or at the address that
may hereafter be given in writing by the MORTGAGOR to the MORTGAGEE, and
the mere act of sending any correspondence by mail or by personal delivery to the
said address shall be valid and effective notice to the MORTGAGOR for all legal
purposes and the fact that any communication is not actually received by the
MORTGAGOR, or that it has been returned unclaimed to the MORTGAGEE, or
that no person was found at the address given, or that the address is fictitious or
cannot be located, shall not excuse or relieve the MORTGAGOR from the effects
of such notice.8
Respondent filed a request for extrajudicial foreclosure of real estate
mortgage9 before Atty. Hipolito Sañez on the ground that Ramirez failed to pay his
loan despite demands. During the auction sale on September 8, 1994, respondent
was the only bidder for the mortgaged properties.10 Thereafter, a certificate of
sale11 was issued in its favor as the highest bidder.
In 2000, respondent demanded that Ramirez vacate the properties.12
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Ramirez sued respondent for annulment of sale and prayed that the certificate of
sale be annulled on the ground, among others, that paragraph N of the real estate
mortgage was violated for he was not notified of the foreclosure and auction sale. 13
In its answer, respondent claimed that the foreclosure proceedings were valid.
The trial court ruled that the extrajudicial foreclosure proceedings were null and
void and the certificate of sale is invalid. The fallo of the Decision14 dated June 30,
2003 of the Regional Trial Court, Branch 193, Marikina City, in Civil Case No.
2001-701-MK reads:
Premises considered, judgment is hereby rendered in favor of the plaintiff
[Ramirez] and against the defendant [bank], whose counterclaim is hereby
dismissed, declaring the Certificate of Sale of the properties covered by TCT Nos.
N-10722 and N-23033, as null and void and ordering the defendant [bank] to pay
the following:
1) One Hundred Thousand (₱100,000.00) Pesos as moral damages;
2) Fifty Thousand (₱50,000.00) Pesos as exemplary damages;
3) Fifty Thousand (₱50,000.00) Pesos as Attorney’s fees; and
4) Costs of suit.
SO ORDERED.15
The CA reversed the trial court’s decision and ruled that absence of personal
notice of foreclosure to Ramirez as required by paragraph N of the real estate
mortgage is not a ground to set aside the foreclosure sale.16 The fallo of the
assailed CA Decision reads:
WHEREFORE, the appealed decision dated June 30, 2003 of the Regional Trial
Court of Marikina, Branch 193 is hereby REVERSED and SET ASIDE, and a new
one is entered AFFIRMING the validity of the Certificate of Sale of the properties
covering TCT Nos. N-10722 and N-23033.
SO ORDERED.17
Ramirez’s motion for reconsideration was denied in the assailed CA Resolution.
Hence, this petition raising a lone issue:
What is the legal effect of violating paragraph N of the deed of mortgage
which requires personal notice to the petitioner-mortgagor by the
respondent-mortgagee bank?18
Ramirez insists that the auction sale as well as the certificate of sale issued to
respondent are null and void since no notice of the foreclosure and sale by public
auction was personally given to him in violation of paragraph N of the real estate
mortgage which requires personal notice to him of said extrajudicial foreclosure. 19
In its comment, respondent counters that under Section 3 of Act No. 3135, no
personal notice to the mortgagor is required in case of a foreclosure sale. The
bank claims that paragraph N of the real estate mortgage does not impose an
additional obligation to it to provide personal notice to the mortgagor Ramirez. 20
We agree with Ramirez and grant his petition.
The CA erred in ruling that absence of notice of extrajudicial foreclosure sale to
Ramirez as required by paragraph N of the real estate mortgage will not invalidate
the extrajudicial foreclosure sale. We rule that when respondent failed to send the
notice of extrajudicial foreclosure sale to Ramirez, it committed a contractual
breach of said paragraph N sufficient to render the extrajudicial foreclosure sale on
September 8, 1994 null and void. Thus, we reverse the assailed CA Decision and
Resolution.
In Carlos Lim, et al. v. Development Bank of the Philippines,21 we held that unless
the parties stipulate, personal notice to the mortgagor in extrajudicial foreclosure
proceedings is not necessary because Section 3 of Act No. 3135 only requires the
posting of the notice of sale in three public places and the publication of that notice
in a newspaper of general circulation. In this case, the parties stipulated in
paragraph N of the real estate mortgage that all correspondence relative to the
mortgage including notifications of extrajudicial actions shall be sent to mortgagor
Ramirez at his given address. Respondent had no choice but to comply with this
contractual provision it has entered into with Ramirez. The contract is the law
between them. Hence, we cannot agree with the bank that paragraph N of the real
estate mortgage does not impose an additional obligation upon it to provide
personal notice of the extrajudicial foreclosure sale to the mortgagor Ramirez.
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As we explained in Metropolitan Bank v. Wong,22 the bank’s violation of paragraph
N of the real estate mortgage is sufficient to invalidate the extrajudicial foreclosure
sale:
[A] contract is the law between the parties and … absent any showing that its
provisions are wholly or in part contrary to law, morals, good customs, public order,
or public policy, it shall be enforced to the letter by the courts. Section 3, Act No.
3135 reads:
"Sec. 3. Notice shall be given by posting notices of the sale for not less than
twenty days in at least three public places of the municipality or city where the
property is situated, and if such property is worth more than four hundred pesos,
such notice shall also be published once a week for at least three consecutive
weeks in a newspaper of general circulation in the municipality and city."
The Act only requires (1) the posting of notices of sale in three public places, and
(2) the publication of the same in a newspaper of general circulation. Personal
notice to the mortgagor is not necessary. Nevertheless, the parties to the mortgage
contract are not precluded from exacting additional requirements. In this case,
petitioner and respondent in entering into a contract of real estate mortgage,
agreed inter alia:
"all correspondence relative to this mortgage, including demand letters,
summonses, subpoenas, or notifications of any judicial or extra-judicial action shall
be sent to the MORTGAGOR…."
Precisely, the purpose of the foregoing stipulation is to apprise respondent of any
action which petitioner might take on the subject property, thus according him the
opportunity to safeguard his rights. When petitioner failed to send the notice of
foreclosure sale to respondent, he committed a contractual breach sufficient to
render the foreclosure sale on November 23, 1981 null and void.1âwphi1
We reiterated the Wong ruling in Global Holiday Ownership Corporation v.
Metropolitan Bank and Trust Company23and recently, in Carlos Lim, et al. v.
Development Bank of the Philippines.24 Notably, all these cases involved
provisions similar to paragraph N of the real estate mortgage in this case.
On another matter, we note that the trial court awarded moral and exemplary
damages, attorney’s fees and costs of suit to Ramirez. In granting said monetary
awards, the trial court noted that if the bank followed strictly the procedure in the
extrajudicial foreclosure of the real estate mortgage and had not filed prematurely
an unlawful detainer case against Ramirez, he would not have been forced to
litigate and incur expenses.25
We delete aforesaid monetary awards, except the award of costs of suit. Nothing
supports the trial court’s award of moral damages. There was no testimony of any
physical suffering, mental anguish, fright, serious anxiety, besmirched reputation,
wounded feelings, moral shock, social humiliation, and similar injury26 suffered by
Ramirez. The award of moral damages must be anchored on a clear showing that
Ramirez actually experienced mental anguish, besmirched reputation, sleepless
nights, wounded feelings or similar injury.27 Ramirez’s testimony28 is also wanting
as to the moral damages he suffered.
Similarly, no exemplary damages can be awarded since there is no basis for the
award of moral damages and there is no award of temperate, liquidated or
compensatory damages.29 Exemplary damages are imposed by way of example
for the public good, in addition to moral, temperate, liquidated or compensatory
damages.30
We likewise delete the trial court’s award of attorney’s fees since the trial court
failed to state in the body of its decision the factual or legal reasons for said
award.31
Indeed, even the instant petition32 does not offer any supporting fact or argument
for us to affirm the award of moral and exemplary damages and attorney’s fees.
However, we agree, with the trial court’s award of costs of suit to Ramirez. Costs
shall be allowed to the prevailing party as a matter of course unless otherwise
provided in the Rules of Court.33 These costs Ramirez may recover are those
stated in Section 10, Rule 142 of the Rules of Court.34 For instance, Ramirez may
recover the lawful fees he paid in docketing his action for annulment of sale before
the trial court. We add thereto the amount of ₱3,530 or the amount of docket and
lawful fees paid by Ramirez for filing this petition before this Court.35 We deleted
the award of moral and exemplary damages; hence, the restriction under Section
7, Rule 142 of the Rules of Court36 would have prevented Ramirez to recover any
cost of suit. But we certify, in accordance with said Section 7, that Ramirez’s action
for annulment of sale involved a substantial and important right such that he is
entitled to an award of costs of suit. Needless to stress, the purpose of paragraph
N of the real estate mortgage is to apprise the mortgagor, Ramirez, of any action
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that the mortgagee-bank might take on the subject properties, thus according him
the opportunity to safeguard his rights. 37
WHEREFORE, we GRANT the petition, REVERSE and SET ASIDE the Decision
dated November 26, 2010 and Resolution dated September 28, 2011 of the Court
of Appeals in CA-G.R. CV No. 80616. The extrajudicial foreclosure proceedings
and auction sale conducted by Atty. Hipolito Safiez on September 8, 1994 and the
Certificate of Sale over the mortgaged properties covered by TCT Nos. N-10722
and N-23033, issued in favor of respondent The Manila Banking Corporation, are
hereby DECLARED NULL and VOID.
Costs against respondent The Manila Banking Corporation.
SO ORDERED.
G.R. No. 184045 January 22, 2014
SPOUSES NICASIO C. MARQUEZ AND ANITA J. MARQUEZ, Petitioners,
vs.
SPOUSES CARLITO ALINDOG AND CARMEN ALINDOG, Respondents.
DECISION
PERLAS-BERNABE, J.:
Assailed in this petition for review on certiorari1 are the Decision2 dated February
29, 2008 and Resolution3 dated August 6, 2008 of the Court of Appeals (CA) in
CA-G.R. SP No. 97744 finding no grave abuse of discretion on the part of the
Regional Trial Court of Tagaytay City, Branch 18 (RTC) in issuing the Orders
dated November 14, 20054and January 17, 2007[[5 ]] in SCA No. TG-05-2521.
Based on these orders, a writ of preliminary injunction was issued against
petitioners-spouses Nicasio C. Marquez and Anita J. Marquez (Sps. Marquez),
enjoining them from taking possession of the property subject of this case despite
the consolidation of their title over the same.
The Facts
Records show that sometime in June 1998, petitioner Anita J. Marquez (Anita)
extended a loan in the amount of ₱500,000.00 to a certain Benjamin Gutierrez
(Gutierrez). As security therefor, Gutierrez executed a Deed of Real Estate
Mortgage6 dated June 16, 1998 over a parcel of land located in Tagaytay City with
an area of 660 square meters, more or less, covered by Transfer Certificate of Title
(TCT) No. T-134437 (subject property), registered under the name of Benjamin A.
Gutierrez, married to Liwanag Camerin (Sps. Gutiererez). The mortgage was duly
annotated on the dorsal portion of TCT No. T-13443, which Sps. Marquez had
verified as clean prior to the mortgage.8
Since Gutierrez defaulted in the payment of his loan obligation, Anita sought the
extra-judicial foreclosure of the subject property. At the public auction sale held on
January 19, 2000, Anita emerged as the highest bidder for the amount of
₱1,171,000.00.9 Upon Gutierrez’s failure to redeem the same property within the
prescribed period therefor, title was consolidated under TCT No. T-4193910 on
November 5, 2001 (in the name of Anita J. Marquez, married to Nicasio C.
Marquez) which, however, bore an annotation of adverse claim 11 dated March 2,
2000 in the names of respondents-spouses Carlito and Carmen Alindog (Sps.
Alindog). Said annotation was copied from an earlier annotation on TCT No. T-
13443 made only after the subject property’s mortgage to Sps. Marquez.
Subsequently, or on March 21, 2000, Sps. Alindog filed a civil case for annulment
of real estate mortgage and certificate of sale with prayer for damages against
Sps. Marquez and a certain Agripina Gonzales (Gonzales) before the RTC,
docketed as Civil Case No. TG-1966 (annulment case). In their complaint,12 Sps.
Alindog alleged that they purchased13 the subject property from Gutierrez way
back in September 1989, but were unable to secure a certificate of title in their
names because Gonzales – to whom they have entrusted said task – had
deceived them in that they were assured that the said certificate was already being
processed when such was not the case.14Eventually, they found out that the
property had already been mortgaged to Sps. Marquez, and that when they tried to
contact Gonzales for an explanation, she could no longer be found. Separately,
Sps. Alindog averred that when the mortgage was executed in favor of Sps.
Marquez, Gutierrez was already dead.15
In their defense,16 Sps. Marquez disputed Sps. Alindog’s ownership over the
subject property, arguing that the purported sale in the latter’s favor was never
registered and therefore, not binding upon them. Further, they insisted that their
certificate of title, TCT No. T-41939, was already indefeasible, and cannot be
attacked collaterally.
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Meanwhile, on March 16, 2005, Anita filed an ex-parte petition for the issuance of
a writ of possession17 (ex-parte petition) before the RTC, docketed as LRC Case
No. TG-05-1068, claiming that the same is ministerial on the court’s part following
the consolidation of her and her husband’s title over the subject property.
Impleaded in said petition are Sps. Gutierrez, including all persons claiming rights
under them.
The RTC Rulings and Subsequent Proceedings
In an Order18 dated August 1, 2005, the RTC granted Anita’s ex-parte petition and
thereby directed the issuance of a writ of possession in her favor. Consequently, a
notice to vacate19 dated September 23, 2005 was issued by Acting Sheriff
Teodorico V. Cosare (Sheriff Cosare) against Sps. Gutierrez and all persons
claiming rights under them. Sps. Alindog were served with a copy of the said
notice to vacate on September 27, 2005.20
Claiming that they would suffer irreparable injury if the implementation of the writ of
possession in favor of Sps. Marquez would be left unrestrained, Sps. Alindog
sought the issuance of a temporary restraining order (TRO) and/or writ of
preliminary injunction with prayer for damages,21 in a separate case docketed as
SCA No. TG-05-252122(injunction case) which was raffled to the same court.
While it appears that the RTC issued a 72-hour TRO on September 29, 2005 in
Sps. Alindog’s favor, records nonetheless show that said order was not extended
to a full 20-day TRO.23 To this end, the Sheriff’s Return24 dated November 14,
2005 shows that Sheriff Cosare was able to implement the writ of possession on
November 11, 2005, turning over the possession of the subject property to Sps.
Marquez.
After further proceedings on the injunction case, the RTC, through an
Order25 dated November 14, 2005, issued a writ of preliminary injunction enjoining
Sps. Marquez from taking possession of the subject property until after the
controversy has been fully resolved on the merits. The said issuance was based
on the RTC’s appreciation of the initial evidence adduced by Sps. Alindog,
concluding that they appear to have a right to be protected. Thus, notwithstanding
the consolidation of Sps. Marquez’s title over the subject property, the RTC
granted Sps. Alindog’s prayer for injunctive relief, holding that any further
dispossession on their part would cause them irreparable injury. 26
Aggrieved, Sps. Marquez moved for reconsideration,27 essentially pointing out that,
as the confirmed and registered owners of the subject property, they are entitled to
its possession as a matter of right. They argued that pursuant to Sections 728 and
829 of Act No. 3135,30 as amended by Act No. 4118,31 the RTC was legally bound
to place them in possession of the subject property pending resolution of the
annulment case. Further, it is their position that the purpose for the issuance of the
injunctive writ – i.e., to restrain the implementation of the writ of possession – had
already been rendered moot and academic by its actual enforcement in the
interim.
For their part, Sps. Alindog filed a Motion for Approval of Cash Bond and to Regain
Possession32 of the subject property.
In an Order33 dated January 17, 2007, the RTC denied the motion of Sps.
Marquez, while granted that of Sps. Alindog. Unperturbed, Sps. Marquez elevated
the case to the CA on certiorari.34
The CA Ruling
In a Decision35 dated February 29, 2008, the CA denied Sps. Marquez’s petition as
it found no grave abuse of discretion on the RTC’s part when it issued the
injunctive writ that enjoined Sps. Marquez from taking possession of the subject
property. It observed that Sps. Alindog had indeed "adduced prima facie proof of
their right to possess the subject property"36 while the annulment case was
pending, adding that the latter’s "right to remain in possession"37 proceeds from
the fact of the subject property’s earlier sale to them. Thus, while Sps. Marquez
concededly had a right to possess the subject property on account of the
consolidation of the title in their names, the CA nonetheless found no fault on the
part of the RTC for "proceeding with caution"38 in weighing the conflicting claims of
the parties and subsequently issuing the writ of preliminary injunction in Sps.
Alindog’s favor.
Dissatisfied, Sps. Marquez moved for reconsideration39 which was, however,
denied in a Resolution40 dated August 6, 2008, hence, this petition.
The Issue Before the Court
The essential issue in this case is whether or not the CA erred in finding no grave
abuse of discretion on the part of the RTC when it issued the injunctive writ which
enjoined Sps. Marquez from taking possession of the subject property.
Page 393 of 507
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 The Court’s Ruling
The petition is meritorious.
It is an established rule that the purchaser in an extra-judicial foreclosure sale is
entitled to the possession of the property and can demand that he be placed in
possession of the same either during (with bond) or after the expiration (without
bond) of the redemption period therefor. To this end, the Court, in China Banking
Corp. v. Sps. Lozada41 (China Banking Corp.), citing several cases on the matter,
explained that a writ of possession duly applied for by said purchaser should issue
as a matter of course, and thus, merely constitutes a ministerial duty on the part of
the court, viz.:42
The procedure for extrajudicial foreclosure of real estate mortgage is governed by
Act No. 3135, as amended. The purchaser at the public auction sale of an
extrajudicially foreclosed real property may seek possession thereof in accordance
with Section 7 of Act No. 3135, as amended, which provides:
SEC. 7. In any sale made under the provisions of this Act, the purchaser may
petition the Court of First Instance of the province or place where the property or
any part thereof is situated, to give him possession thereof during the redemption
period, furnishing bond in an amount equivalent to the use of the property for a
period of twelve months, to indemnify the debtor in case it be shown that the sale
was made without violating the mortgage or without complying with the
requirements of this Act. Such petition shall be made under oath and filed in form
or an ex parte motion in the registration or cadastral proceedings if the property is
registered, or in special proceedings in the case of property registered under the
Mortgage Law or under section one hundred and ninety-four of the Administrative
Code, or of any other real property encumbered with a mortgage duly registered in
the office of any register of deeds in accordance with any existing law, and in each
case the clerk of court shall, upon the filing of such petition, collect the fees
specified in paragraph eleven of section one hundred and fourteen of Act
Numbered Four hundred and ninety six as amended by Act Numbered Twenty-
eight hundred and sixty-six, and the court shall, upon approval of the bond, order
that a writ of possession issue addressed to the sheriff of the province in which the
property is situated, who shall execute said order immediately.
The Court expounded on the application of the foregoing provision in De Gracia v.
San Jose, thus:
As may be seen, the law expressly authorizes the purchaser to petition for a writ of
possession during the redemption period by filing an ex parte motion under oath
for that purpose in the corresponding registration or cadastral proceeding in the
case of property with Torrens title; and upon the filing of such motion and the
approval of the corresponding bond, the law also in express terms directs the court
to issue the order for a writ of possession. Under the legal provisions above
copied, the order for a writ of possession issues as a matter of course upon the
filing of the proper motion and the approval of the corresponding bond. No
discretion is left to the court. And any question regarding the regularity and validity
of the sale (and the consequent cancellation of the writ) is left to be determined in
a subsequent proceeding as outlined in section 8. Such question is not to be
raised as a justification for opposing the issuance of the writ of possession, since,
under the Act, the proceeding for this is ex parte.
Strictly, Section 7 of Act No. 3135, as amended, refers to a situation wherein the
purchaser seeks possession of the foreclosed property during the 12-month period
for redemption. Upon the purchaser’s filing of the ex parte petition and posting of
the appropriate bond, the RTC shall, as a matter of course, order the issuance of
the writ of possession in the purchaser’s favor.
In IFC Service Leasing and Acceptance Corporation v. Nera, the Court reasoned
that if under Section 7 of Act No. 3135, as amended, the RTC has the power
during the period of redemption to issue a writ of possession on the ex parte
application of the purchaser, there is no reason why it should not also have the
same power after the expiration of the redemption period, especially where a new
title has already been issued in the name of the purchaser. Hence, the procedure
under Section 7 of Act No. 3135, as amended, may be availed of by a purchaser
seeking possession of the foreclosed property he bought at the public auction sale
after the redemption period has expired without redemption having been made.
xxxx
It is thus settled that the buyer in a foreclosure sale becomes the absolute owner
of the property purchased if it is not redeemed during the period of one year after
the registration of the sale. As such, he is entitled to the possession of the said
property and can demand it at any time following the consolidation of ownership in
his name and the issuance to him of a new transfer certificate of title. The buyer
can in fact demand possession of the land even during the redemption period
except that he has to post a bond in accordance with Section 7 of Act No. 3135, as
amended. No such bond is required after the redemption period if the property is
Page 394 of 507
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not redeemed. Possession of the land then becomes an absolute right of the
purchaser as confirmed owner. Upon proper application and proof of title, the
issuance of the writ of possession becomes a ministerial duty of the court.
(Emphases and underscoring supplied; citations and emphases in the original
omitted)
In the case of Spouses Espiridion v. CA,43 the Court expounded on the ministerial
nature of the foregoing issuance as follows:44
The issuance of a writ of possession to a purchaser in a public auction is a
ministerial act.1âwphi1 After the consolidation of title in the buyer’s name for failure
of the mortgagor to redeem the property, the writ of possession becomes a matter
of right. Its issuance to a purchaser in an extrajudicial foreclosure sale is merely a
ministerial function. The trial court has no discretion on this matter. Hence, any talk
of discretion in connection with such issuance is misplaced.
A clear line demarcates a discretionary act from a ministerial one. Thus:
The distinction between a ministerial and discretionary act is well delineated. A
purely ministerial act or duty is one which an officer or tribunal performs in a given
state of facts, in a prescribed manner, in obedience to the mandate of a legal
authority, without regard to or the exercise of his own judgment upon the propriety
or impropriety of the act done. If the law imposes a duty upon a public officer and
gives him the right to decide how or when the duty shall be performed, such duty is
discretionary and not ministerial. The duty is ministerial only when the discharge of
the same requires neither the exercise of official discretion or judgment.
Clearly, the use of discretion and the performance of a ministerial act are mutually
exclusive. (Emphases and underscoring supplied; citations omitted)
The ministerial issuance of a writ of possession in favor of the purchaser in an
extra-judicial foreclosure sale, however, admits of an exception. Section 33,45 Rule
39 of the Rules of Court (Rules) pertinently provides that the possession of the
mortgaged property may be awarded to a purchaser in an extra-judicial foreclosure
unless a third party is actually holding the property by adverse title or right. In the
recent case of Rural Bank of Sta. Barbara (Iloilo), Inc. v. Centeno,46 citing the case
of China Banking Corp., the Court illumined that "the phrase ‘a third party who is
actually holding the property adversely to the judgment obligor’ contemplates a
situation in which a third party holds the property by adverse title or right, such as
that of a co-owner, tenant or usufructuary. The co-owner, agricultural tenant, and
usufructuary possess the property in their own right, and they are not merely the
successor or transferee of the right of possession of another co-owner or the
owner of the property. Notably, the property should not only be possessed by a
third party, but also held by the third party adversely to the judgment obligor." 47 In
other words, as mentioned in Villanueva v. Cherdan Lending Investors
Corporation,48 the third person must therefore claim a right superior to that of the
original mortgagor.
In this case, it is clear that the issuance of a writ of possession in favor of Sps.
Marquez, who had already consolidated their title over the extra-judicially
foreclosed property, is merely ministerial in nature. The general rule as herein
stated – and not the exception found under Section 33, Rule 39 of the Rules –
should apply since Sps. Alindog hinged their claim over the subject property on
their purported purchase of the same from its previous owner, i.e., Sps. Gutierrez
(with Gutierrez being the original mortgagor). Accordingly, it cannot be seriously
doubted that Sps. Alindog are only the latter’s (Sps. Gutierrez) successors-in-
interest who do not have a right superior to them.
That said, the RTC therefore gravely abused its discretion when it issued the
injunctive writ which enjoined Sps. Marquez from taking possession of the subject
property. To be sure, grave abuse of discretion arises when a lower court or
tribunal patently violates the Constitution, the law or existing jurisprudence. 49 Here,
while the RTC had initially issued a writ of possession in favor of Sps. Marquez, it
defied existing jurisprudence when it effectively rescinded the said writ by
subsequently granting Sps. Alindog's prayer for injunctive relief. The RTC's finding
anent the initial evidence adduced by Sps. Alindog constitutes improper basis to
justify the issuance of the writ of preliminary injunction in their favor since, in the
first place, it had no authority to exercise any discretion in this respect.
Jurisprudence is clear on the matter: without the exception under Section 33, Rule
39 of the Rules availing, the issuance of a writ of possession in favor of the
purchaser of an extra-judicially foreclosed property - such as Sps.
Marquez in this case - should come as a matter of course, and, in such regard,
constitutes only a ministerial duty on the part of the court. Besides, it was improper
for the RTC to have issued a writ of preliminary injunction since the act sought to
be enjoined, i.e., the implementation of the writ of possession, had already been
accomplished in the interim and thus, rendered the matter moot. Case law
instructs that injunction would not lie where the acts sought to be enjoined had
already become fait accompli (meaning, an accomplished or consummated
act).50 Hence, since the consummation of the act sought to be restrained had
Page 395 of 507
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rendered Sps. Alindog's injunction petition moot, the issuance of the said injunctive
writ was altogether improper.
All told, by acting averse to well-settled jurisprudential rules and resultantly
depriving Sps. Marquez of their right of possession over the subject property, the
Court therefore concludes that the RTC gravely abused its discretion in this case.
In effect, the CA's contrary ruling thereto is hereby reversed and set aside, which
consequentially leads to the nullification of the writ of preliminary injunction issued
by the RTC in favor of Sps. Alindog, and the reinstatement of the writ of
possession issued by the same court in favor of Sps. Marquez. It must, however,
be noted that these pronouncements are without prejudice to any separate action
which Sps. Alindog may file in order to recover ownership of the subject property.
WHEREFORE, the petition is GRANTED. The Decision dated February 29, 2008
and Resolution dated August 6, 2008 of the Court of Appeals in CA-G.R. SP No.
97744, as well as the Orders dated November 14, 2005 and January 17, 2007 of
the Regional Trial Court of Tagaytay City, Branch 18 in SCA No. TG-05-2521 are
hereby REVERSED and SET ASIDE. Accordingly, the writ of preliminary injunction
in SCA No. TG-05-2521 is NULLIFIED, while the Writ of Possession in LRC Case
No. TG-05-1068 is REINSTATED.
SO ORDERED.
G.R. No. 187973 January 20, 2014
LZK HOLDINGS and DEVELOPMENT CORPORATION, Petitioner,
vs.
PLANTERS DEVELOPMENT BANK, Respondent.
RESOLUTION
REYES, J.:
This resolves the appeal filed by petitioner LZK Holdings and Development
Corporation (LZK Holdings) assailing the Decision1 dated January 27, 2009 of the
Court of Appeals (CA) in CA-G.R. S.P. No. 103267 affirming the Order2dated April
8, 2008 of the Regional Trial Court (RTC) of San Fernando City (San Fernando),
La Union, Branch 66, which issued a writ of possession in favor of respondent
Planters Development Bank (Planters Bank).
The facts are not disputed.
LZK Holdings obtained a ₱40,000,000.00 loan from Planters Bank on December
16, 1996 and secured the same with a Real Estate Mortgage over its lot located in
La Union. The lot measures 589 square meters and is covered by Transfer
Certificate of Title No. T-45337.
On September 21, 1998, the lot was sold at a public auction after Planters Bank
extrajudicially foreclosed the real estate mortgage thereon due to LZK Holdings'
failure to pay its loan. Planters Bank emerged as the highest bidder during the
auction sale and its certificate of sale was registered on March 16, 1999.
On April 5, 1999, LZK Holdings filed before the RTC of Makati City, Branch 150, a
complaint for annulment of extra judicial foreclosure, mortgage contract,
promissory note and damages. LZK Holdings also prayed for the issuance of a
temporary restraining order (TRO) or writ of preliminary injunction to enjoin the
consolidation of title over the lot by Planters Bank.
On December 27, 1999, Planters Bank filed an ex-parte motion for the issuance of
a writ of possession with the RTC-San Fernando.
On March 13, 2000 or three (3) days before the expiration of LZK Holdings'
redemption period, the RTC-Makati issued a TRO effective for 20 days enjoining
Planters Bank from consolidating its title over the property. On April 3, 2000, the
RTC-Makati ordered the issuance of a writ of preliminary injunction for the same
purpose3 but the writ was issued only on June 20, 2000 upon LZK Holdings'
posting of a ₱40,000.00 bond.
In the meantime, Planters Bank succeeded in consolidating its ownership over the
property on April 24, 2000. However, the proceedings for its ex-parte motion for
the issuance of a writ of possession was suspended by the RTC-San Fernando in
an Order dated May 11, 2000 in view of the TRO and writ of preliminary injunction
issued by the RTC-Makati. Planters Bank moved for reconsideration but its motion
was denied by the RTC-San Fernando in an Order dated September 1, 2000.4
Page 396 of 507
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Meanwhile, upon motion of LZK Holdings, the RTC-Makati declared as null and
void the consolidated title of Planters Bank in an Order 5 dated June 2, 2000. Such
ruling was affirmed by the CA in a Decision6 dated February 26, 2004 in CA-G.R.
SP No. 59327. When the matter reached the Court via G.R. No. 164563, we
sustained the CA's judgment in our Resolution7 dated September 13, 2004.
Planters Bank also appealed the May 11, 2000 Order of the RTC-San Fernando
which held in abeyance the resolution of its ex parte motion for the issuance of a
writ of possession. This time, Planters Bank was victorious. The CA granted the
appeal and annulled the assailed order of the RTC-San Fernando. Aggrieved, LZK
Holdings sought recourse with the Court in a petition for review docketed as G.R.
No. 167998.8 In Our Decision dated April 27, 2007, we affirmed the CA's ruling and
decreed that Planters Bank may apply for and is entitled to a writ of possession as
the purchaser of the property in the foreclosure sale, viz:
"A writ of possession is a writ of execution employed to enforce a judgment to
recover the possession of land. It commands the sheriff to enter the land and give
possession of it to the person entitled under the judgment. It may be issued in case
of an extrajudicial foreclosure of a real estate mortgage under Section 7 of Act No.
3135, as amended by Act No. 4118.
Under said provision, the writ of possession may be issued to the purchaser in a
foreclosure sale either within the one-year redemption period upon the filing of a
bond, or after the lapse of the redemption period, without need of a bond.
We have consistently held that the duty of the trial court to grant a writ of
possession is ministerial. Such writ issues as a matter of course upon the filing of
the proper motion and the approval of the corresponding bond. No discretion is left
to the trial court. Any question regarding the regularity and validity of the sale, as
well as the consequent cancellation of the writ, is to be determined in a
subsequent proceeding as outlined in Section 8 of Act No. 3135. Such question
cannot be raised to oppose the issuance of the writ, since the proceeding is ex
parte. The recourse is available even before the expiration of the redemption
period provided by law and the Rules of Court.
To emphasize the writ's ministerial character, we have in previous cases
disallowed injunction to prohibit its issuance, just as we have held that issuance of
the same may not be stayed by a pending action for annulment of mortgage or the
foreclosure itself.
xxxx
x x x [Planters Bank], as the purchaser in the foreclosure sale, may apply for a writ
of possession during the redemption period. In fact, it did apply for a writ on
December 27, 1999, well within the redemption period. The San Fernando RTC,
given its ministerial duty to issue the writ, therefore, should have acted on the ex
parte petition. The injunction order is of no moment because it should be
understood to have merely stayed the consolidation of title. As previously stated,
an injunction is not allowed to prohibit the issuance of a writ of possession. Neither
does the pending case for annulment of foreclosure sale, mortgage contract,
promissory notes and damages stay the issuance of said writ.
Lastly, the trial on the merits has not even started. Until the foreclosure sale of the
property in question is annulled by a court of competent jurisdiction, petitioner is
bereft of valid title and of the right to prevent the issuance of a writ of possession to
[Planters Bank]. Until then, it is the trial court's ministerial function to grant the
possessory writ to [Planters Bank]. "9 (Citations omitted)
Armed with the above ruling, Planters Bank filed before the RTC-San Fernando a
motion to set ex-parte hearing for the issuance of a writ of possession. LZK
Holdings opposed the motion. In an Order dated April 2, 2008, the RTC-San
Fernando denied the opposition and set the hearing on April 14, 2008. On April 8,
2008, the RTC-San Fernando issued another Order10 declaring the scheduled
hearing moot and academic and granting Planter Bank's ex-parte motion for the
issuance of a writ of possession which was filed as early as December 27, 1999.
The decretal portion of the order reads:
WHEREFORE, premises considered, the pet1t10n is hereby granted, hence the
order setting the case for ex-parte hearing on April 14, 2008 is rendered moot and
academic by this order. Let [a] Writ of Possession issue in favor of Planters
Development Bank and the Deputy Sheriff of this Court is hereby directed to place
Planters Development Bank or any of its authorized representatives in possession
of the subject parcel of land, together with all the improvements existing thereon,
covered by TCT- 45337 of the Register of Deeds for the province of La Union
against LZK HOLDINGS AND DEVELOPMENT CORPORATION (referred to as
LZK) including all other persons/occupants who are claiming rights under them and
who are depriving [Planters Bank] of its right to possess the above-described
property upon the filing of bond by (Planters Bank] in the amount of two million
pesos (Php2,000,000.00).
Page 397 of 507
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SO ORDERED.11
In its herein assailed Decision12 dated January 27, 2009, the CA affirmed the
foregoing ruling and dismissed LZK Holdings' petition for certiorari docketed as
CA-G.R. SP No. 103267. The CA likewise denied LZK Holdings' motion for
reconsideration in its Resolution13 dated May 12, 2009.
LZK Holdings then filed a motion before the Court for a 30-day extension within
which to file a petition for review reckoned from the date of its receipt of the
resolution granting such extension. In our Resolution dated July 15, 2009 we
granted the motion but we ordered that the 30-day extended period shall be
counted from the expiration of the original reglementary period.14 As such, LZK
Holdings had until July 23, 2009 to file its petition and not August 24, 2009 or the
date when the petition was actually filed.
In our Resolution dated August 26, 2009, we denied the petition for being filed
beyond the extended period pursuant to Section 5(a), Rule 56 of the Rules of
Court and for lack of reversible error in the assailed judgment of the CA. 15LZK
Holdings moved for reconsideration16 explaining that it was able to obtain a copy of
the Court's July 15, 2009 Resolution on July 29, 2009 when Lourdes Z. Korshak,
LZK Holdings' Chief Executive Officer, went to the Office of the Clerk of Court of
the Third Division and that she still had to confront and get the case records from
the company's previous counsel and then look for a substitute lawyer. LZK
Holdings also claimed that the writ of possession issued to Planters Bank should
be annulled for the following reasons, to wit:
(a) with the cancellation of Planters Bank's consolidated title, LZK
Holdings remain to be the registered owner of the property and as such,
the former had no right to apply for a writ of possession pursuant to PNB v.
Sanao Marketing Corporation,17 which held that right of possession is
based on the ownership of the subject property by the applicant;
(b) LZK Holdings was deprived of due process because the RTC did not
conduct a hearing on Planter Bank's motion for the issuance of a writ of
possession;
(c) the P.2,000,000.00 bond posted by LZK Holdings does not conform
with Section 7 of Act No. 3135 which mandates that the bond amount shall
be equivalent to "twelve (12) months use of the subject property" which in
this case amounted to P.7,801,4 72.28 at the time the writ was issued.
In a Resolution18 dated October 13, 2010 the Court took a liberal stance on the late
filing of LZK Holdings' petition for review. Accordingly, its motion for
reconsideration was granted and the petition for review reinstated.
However, after a re-examination of the substantive merits of the petition, the Court
finds and stands by its initial determination that the CA committed no reversible
error in affirming the issuance of a writ of possession by the R TC in favor of
Planters Bank.
Under the principle of conclusiveness of judgment, the right of Planter's Bank to a
writ of possession as adjudged in G.R. No. 167998 is binding and conclusive on
the parties.
The doctrine of res judicata by conclusiveness of judgment postulates that "when a
right or fact has been judicially tried and determined by a court of competent
jurisdiction, or when an opportunity for such trial has been given, the judgment of
the court, as long as it remains unreversed, should be conclusive upon the parties
and those in privity with them."19
All the elements of the doctrine are present in this case. The final judgment in G.R.
No. 167998 was rendered by the Court pursuant to its jurisdiction over the review
of decisions and rulings of the CA. It was a judgment on the merits of Planters
Banks's right to apply for and be issued a writ of possession. Lastly, the parties in
G.R. No. 167998 are the same parties involved in the present case.20
Hence, LZK Holdings can no longer question Planter Bank's right to a writ of
possession over the subject property because the doctrine of conclusiveness of
judgment bars the relitigation of such particular issue.
Moreover, the authority relied upon by LZK Holdings defeats rather than support its
position. The ruling in PNB21echoes the very same rationale of the judgment in
G.R. No. 167998 that is - the purchaser in foreclosure sale may take possession of
the property even before the expiration of the redemption period by filing an ex
parte motion for such purpose and upon posting of the necessary bond. 22
The pronouncement in PNB that right of possession is based on the ownership of
the subject property by the applicant pertains to applications for writ of possession
after the expiration of the redemption period, a situation not contemplated within
the facts of the present case.
Page 398 of 507
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We cannot also uphold the contentions of LZK Holdings that the RTC, in issuing
the writ of possession, transgressed Act No. 3135.23
No hearing is required prior to the issuance of a writ of possession. This is clear
from the following disquisitions in Espinoza v. United Overseas Bank Phils. 24 which
reiterates the settled rules on writs of possession, to wit:
The proceeding in a petition for a writ of possession is ex parte and summary in
nature.1âwphi1 It is a judicial proceeding brought for the benefit of one party only
and without notice by the court to any person adverse of interest. It is a proceeding
wherein relief is granted without giving the person against whom the relief is
sought an opportunity to be heard.
By its very nature, an ex parte petition for issuance of a writ of possession is a
non-litigious proceeding. It is a judicial proceeding for the enforcement of one's
right of possession as purchaser in a foreclosure sale. It is not an ordinary suit filed
in court, by which one party sues another for the enforcement of a wrong or
protection of a right, or the prevention or redress of a wrong. 25 (Citations omitted)
Given the ex-parte nature of the proceedings for a writ of possession, the R TC did
not err in cancelling the previously scheduled hearing and in granting Planters
Bank's motion without affording notice to LZK Holdings or allowing it to participate.
Anent the correct amount of surety bond, it is well to emphasize that our task in an
appeal by petition for review on certiorari is limited, as a jurisdictional matter, to
reviewing errors of law that might have been committed by the CA.26The
allegations of incorrect computation of the surety bond involve factual matters
within the competence of the trial court to address as this Court is not a trier of
facts. The RTC found the amount of ₱2,000,000.00 to be sufficiently equivalent to
the use of the property for a period of twelve (12) months. We are bound by such
factual finding especially considering the affirmation accorded it by the CA.
In fine, the decision of the CA is in accordance with the law and jurisprudence on
the matter. It correctly sustained the Order of the RTC in issuing a writ of
possession in favor of Planters Bank.
WHEREFORE, premises considered, the petition is hereby DENIED. The Decision
dated January 27, 2009 of the Court of Appeals in CA-G.R. S.P. No. 103267 is
AFFIRMED.
SO ORDERED.
G.R. No. 195540 March 13, 2013
GOLDENWAY MERCHANDISING CORPORATION, Petitioner,
vs.
EQUITABLE PCI BANK, Respondent.
DECISION
VILLARAMA, JR., J.:
Before the Court is a petition for review on certiorari which seeks to reverse and
set aside the Decision1 dated November 19, 2010 and Resolution2 dated January
31, 2011 of the Court of Appeals (CA) in CA-G.R. CV No. 91120. The CA affirmed
the Decision3 dated January 8, 2007 of the Regional Trial Court (RTC) of-
Valenzuela City, Branch 171 dismissing the complaint in Civil Case No. 295-V -01.
The facts are undisputed.
On November 29, 1985, Goldenway Merchandising Corporation (petitioner)
executed a Real Estate Mortgage in favor of Equitable PCI Bank (respondent) over
its real properties situated in Valenzuela, Bulacan (now Valenzuela City) and
covered by Transfer Certificate of Title (TCT) Nos. T-152630, T-151655 and T-
214528 of the Registry of Deeds for the Province of Bulacan. The mortgage
secured the Two Million Pesos (₱2,000,000.00) loan granted by respondent to
petitioner and was duly registered.4
As petitioner failed to settle its loan obligation, respondent extrajudicially
foreclosed the mortgage on December 13, 2000. During the public auction, the
mortgaged properties were sold for ₱3,500,000.00 to respondent. Accordingly, a
Certificate of Sale was issued to respondent on January 26, 2001. On February
16, 2001, the Certificate of Sale was registered and inscribed on TCT Nos. T-
152630, T-151655 and T-214528.5
Page 399 of 507
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In a letter dated March 8, 2001, petitioner’s counsel offered to redeem the
foreclosed properties by tendering a check in the amount of ₱3,500,000.00. On
March 12, 2001, petitioner’s counsel met with respondent’s counsel reiterating
petitioner’s intention to exercise the right of redemption.6 However, petitioner was
told that such redemption is no longer possible because the certificate of sale had
already been registered. Petitioner also verified with the Registry of Deeds that title
to the foreclosed properties had already been consolidated in favor of respondent
and that new certificates of title were issued in the name of respondent on March
9, 2001.
On December 7, 2001, petitioner filed a complaint7 for specific performance and
damages against the respondent, asserting that it is the one-year period of
redemption under Act No. 3135 which should apply and not the shorter redemption
period provided in Republic Act (R.A.) No. 8791. Petitioner argued that applying
Section 47 of R.A. 8791 to the real estate mortgage executed in 1985 would result
in the impairment of obligation of contracts and violation of the equal protection
clause under the Constitution. Additionally, petitioner faulted the respondent for
allegedly failing to furnish it and the Office of the Clerk of Court, RTC of Valenzuela
City with a Statement of Account as directed in the Certificate of Sale, due to which
petitioner was not apprised of the assessment and fees incurred by respondent,
thus depriving petitioner of the opportunity to exercise its right of redemption prior
to the registration of the certificate of sale.
In its Answer with Counterclaim,8 respondent pointed out that petitioner cannot
claim that it was unaware of the redemption price which is clearly provided in
Section 47 of R.A. No. 8791, and that petitioner had all the opportune time to
redeem the foreclosed properties from the time it received the letter of demand
and the notice of sale before the registration of the certificate of sale. As to the
check payment tendered by petitioner, respondent said that even assuming
arguendo such redemption was timely made, it was not for the amount as required
by law.
On January 8, 2007, the trial court rendered its decision dismissing the complaint
as well as the counterclaim. It noted that the issue of constitutionality of Sec. 47 of
R.A. No. 8791 was never raised by the petitioner during the pre-trial and the trial.
Aside from the fact that petitioner’s attempt to redeem was already late, there was
no valid redemption made because Atty. Judy Ann Abat-Vera who talked to Atty.
Joseph E. Mabilog of the Legal Division of respondent bank, was not properly
authorized by petitioner’s Board of Directors to transact for and in its behalf; it was
only a certain Chan Guan Pue, the alleged President of petitioner corporation, who
gave instruction to Atty. Abat-Vera to redeem the foreclosed properties.9
Aggrieved, petitioner appealed to the CA which affirmed the trial court’s decision.
According to the CA, petitioner failed to justify why Section 47 of R.A. No. 8791
should be declared unconstitutional. Furthermore, the appellate court concluded
that a reading of Section 47 plainly reveals the intention to shorten the period of
redemption for juridical persons and that the foreclosure of the mortgaged
properties in this case when R.A. No. 8791 was already in effect clearly falls within
the purview of the said provision.10
Petitioner’s motion for reconsideration was likewise denied by the CA.
In the present petition, it is contended that Section 47 of R.A. No. 8791 is
inapplicable considering that the contracting parties expressly and categorically
agreed that the foreclosure of the real estate mortgage shall be in accordance with
Act No. 3135. Citing Co v. Philippine National Bank 11 petitioner contended that the
right of redemption is part and parcel of the Deed of Real Estate Mortgage itself
and attaches thereto upon its execution, a vested right flowing out of and made
dependent upon the law governing the contract of mortgage and not on the
mortgagee’s act of extrajudicially foreclosing the mortgaged properties. This Court
thus held in said case that "Under the terms of the mortgage contract, the terms
and conditions under which redemption may be exercised are deemed part and
parcel thereof whether the same be merely conventional or imposed by law."
Petitioner then argues that applying Section 47 of R.A. No. 8791 to the present
case would be a substantial impairment of its vested right of redemption under the
real estate mortgage contract. Such impairment would be violative of the
constitutional proscription against impairment of obligations of contract, a patent
derogation of petitioner’s vested right and clearly changes the intention of the
contracting parties. Moreover, citing this Court’s ruling in Rural Bank of Davao City,
Inc. v. Court of Appeals12 where it was held that "Section 119 prevails over
statutes which provide for a shorter period of redemption in extrajudicial
foreclosure sales", and in Sulit
v. Court of Appeals,13 petitioner stresses that it has always been the policy of this
Court to aid rather than defeat the mortgagor’s right to redeem his property.
Petitioner further argues that since R.A. No. 8791 does not provide for its
retroactive application, courts therefore cannot retroactively apply its provisions to
contracts executed and consummated before its effectivity. Also, since R.A. 8791
is a general law pertaining to the banking industry while Act No. 3135 is a special
law specifically governing real estate mortgage and foreclosure, under the rules of
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statutory construction that in case of conflict a special law prevails over a general
law regardless of the dates of enactment of both laws, Act No. 3135 clearly should
prevail on the redemption period to be applied in this case.
The constitutional issue having been squarely raised in the pleadings filed in the
trial and appellate courts, we shall proceed to resolve the same.
The law governing cases of extrajudicial foreclosure of mortgage is Act No.
3135,14 as amended by Act No. 4118. Section 6 thereof provides:
SEC. 6. In all cases in which an extrajudicial sale is made under the special power
hereinbefore referred to, the debtor, his successors-in-interest or any judicial
creditor or judgment creditor of said debtor, or any person having a lien on the
property subsequent to the mortgage or deed of
trust under which the property is sold, may redeem the same at any time within the
term of one year from and after the date of the sale; and such redemption shall be
governed by the provisions of sections four hundred and sixty-four to four hundred
and sixty-six, inclusive, of the Code of
Civil Procedure,15 in so far as these are not inconsistent with the provisions of this
Act.
The one-year period of redemption is counted from the date of the registration of
the certificate of sale. In this case, the parties provided in their real estate
mortgage contract that upon petitioner’s default and the latter’s entire loan
obligation becoming due, respondent may immediately foreclose the mortgage
judicially in accordance with the Rules of Court, or extrajudicially in accordance
with Act No. 3135, as amended.
However, Section 47 of R.A. No. 8791 otherwise known as "The General Banking
Law of 2000" which took effect on June 13, 2000, amended Act No. 3135. Said
provision reads:
SECTION 47. Foreclosure of Real Estate Mortgage. — In the event of foreclosure,
whether judicially or extrajudicially, of any mortgage on real estate which is
security for any loan or other credit accommodation granted, the mortgagor or
debtor whose real property has been sold for the full or partial payment of his
obligation shall have the right within one year after the sale of the real estate, to
redeem the property by paying the amount due under the mortgage deed, with
interest thereon at the rate specified in the mortgage, and all the costs and
expenses incurred by the bank or institution from the sale and custody of said
property less the income derived therefrom. However, the purchaser at the auction
sale concerned whether in a judicial or extrajudicial foreclosure shall have the right
to enter upon and take possession of such property immediately after the date of
the confirmation of the auction sale and administer the same in accordance with
law. Any petition in court to enjoin or restrain the conduct of foreclosure
proceedings instituted pursuant to this provision shall be given due course only
upon the filing by the petitioner of a bond in an amount fixed by the court
conditioned that he will pay all the damages which the bank may suffer by the
enjoining or the restraint of the foreclosure proceeding.
Notwithstanding Act 3135, juridical persons whose property is being sold pursuant
to an extrajudicial foreclosure, shall have the right to redeem the property in
accordance with this provision until, but not after, the registration of the certificate
of foreclosure sale with the applicable Register of Deeds which in no case shall be
more than three (3) months after foreclosure, whichever is earlier. Owners of
property that has been sold in a foreclosure sale prior to the effectivity of this Act
shall retain their redemption rights until their expiration. (Emphasis supplied.)
Under the new law, an exception is thus made in the case of juridical persons
which are allowed to exercise the right of redemption only "until, but not after, the
registration of the certificate of foreclosure sale" and in no case more than three
(3) months after foreclosure, whichever comes first.16
May the foregoing amendment be validly applied in this case when the real estate
mortgage contract was executed in 1985 and the mortgage foreclosed when R.A.
No. 8791 was already in effect?
We answer in the affirmative.
When confronted with a constitutional question, it is elementary that every court
must approach it with grave care and considerable caution bearing in mind that
every statute is presumed valid and every reasonable doubt should be resolved in
favor of its constitutionality. 17 For a law to be nullified, it must be shown that there
is a clear and unequivocal breach of the Constitution. The ground for nullity must
be clear and beyond reasonable doubt.18Indeed, those who petition this Court to
declare a law, or parts thereof, unconstitutional must clearly establish the basis
therefor. Otherwise, the petition must fail.19
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Petitioner’s contention that Section 47 of R.A. 8791 violates the constitutional
proscription against impairment of the obligation of contract has no basis.
The purpose of the non-impairment clause of the Constitution20 is to safeguard the
integrity of contracts against unwarranted interference by the State. As a rule,
contracts should not be tampered with by subsequent laws that would change or
modify the rights and obligations of the parties.21 Impairment is anything that
diminishes the efficacy of the contract. There is an impairment if a subsequent law
changes the terms of a contract between the parties, imposes new conditions,
dispenses with those agreed upon or withdraws remedies for the enforcement of
the rights of the parties.22
Section 47 did not divest juridical persons of the right to redeem their foreclosed
properties but only modified the time for the exercise of such right by reducing the
one-year period originally provided in Act No. 3135. The new redemption period
commences from the date of foreclosure sale, and expires upon registration of the
certificate of sale or three months after foreclosure, whichever is earlier. There is
likewise no retroactive application of the new redemption period because Section
47 exempts from its operation those properties foreclosed prior to its effectivity and
whose owners shall retain their redemption rights under Act No. 3135.
Petitioner’s claim that Section 47 infringes the equal protection clause as it
discriminates mortgagors/property owners who are juridical persons is equally
bereft of merit.
The equal protection clause is directed principally against undue favor and
individual or class privilege.1âwphi1 It is not intended to prohibit legislation which
is limited to the object to which it is directed or by the territory in which it is to
operate. It does not require absolute equality, but merely that all persons be
treated alike under like conditions both as to privileges conferred and liabilities
imposed.23 Equal protection permits of reasonable classification.24 We have ruled
that one class may be treated differently from another where the groupings are
based on reasonable and real distinctions.25 If classification is germane to the
purpose of the law, concerns all members of the class, and applies equally to
present and future conditions, the classification does not violate the equal
protection guarantee.26
We agree with the CA that the legislature clearly intended to shorten the period of
redemption for juridical persons whose properties were foreclosed and sold in
accordance with the provisions of Act No. 3135.27
The difference in the treatment of juridical persons and natural persons was based
on the nature of the properties foreclosed – whether these are used as residence,
for which the more liberal one-year redemption period is retained, or used for
industrial or commercial purposes, in which case a shorter term is deemed
necessary to reduce the period of uncertainty in the ownership of property and
enable mortgagee-banks to dispose sooner of these acquired assets. It must be
underscored that the General Banking Law of 2000, crafted in the aftermath of the
1997 Southeast Asian financial crisis, sought to reform the General Banking Act of
1949 by fashioning a legal framework for maintaining a safe and sound banking
system.28 In this context, the amendment introduced by Section 47 embodied one
of such safe and sound practices aimed at ensuring the solvency and liquidity of
our banks.1âwphi1 It cannot therefore be disputed that the said provision
amending the redemption period in Act 3135 was based on a reasonable
classification and germane to the purpose of the law.
This legitimate public interest pursued by the legislature further enfeebles
petitioner’s impairment of contract theory.
The right of redemption being statutory, it must be exercised in the manner
prescribed by the statute,29 and within the prescribed time limit, to make it
effective. Furthermore, as with other individual rights to contract and to property, it
has to give way to police power exercised for public welfare.30 The concept of
police power is well-established in this jurisdiction. It has been defined as the
"state authority to enact legislation that may interfere with personal liberty or
property in order to promote the general welfare." Its scope, ever-expanding to
meet the exigencies of the times, even to anticipate the future where it could be
done, provides enough room for an efficient and flexible response to conditions
and circumstances thus assuming the greatest benefits.31
The freedom to contract is not absolute; all contracts and all rights are subject to
the police power of the State and not only may regulations which affect them be
established by the State, but all such regulations must be subject to change from
time to time, as the general well-being of the community may require, or as the
circumstances may change, or as experience may demonstrate the
necessity.32 Settled is the rule that the non-impairment clause of the Constitution
must yield to the loftier purposes targeted by the Government. The right granted by
this provision must submit to the demands and necessities of the State’s power of
regulation.33 Such authority to regulate businesses extends to the banking industry
which, as this Court has time and again emphasized, is undeniably imbued with
public interest.34
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Having ruled that the assailed Section 47 of R.A. No. 8791 is constitutional, we find
no reversible error committed by the CA in holding that petitioner can no longer
exercise the right of redemption over its foreclosed properties after the certificate
of sale in favor of respondent had been registered.
WHEREFORE, the petition for review on certiorari is DENIED for lack of merit. The
Decision dated November 19, 2010 and Resolution dated January 31, 2011 of the
Court of Appeals in CA-G.R. CV No. 91120 are hereby AFFIRMED.
With costs against the petitioner.
SO ORDERED.
G.R. No. 167420 June 5, 2009
ALLIED BANKING CORPORATION, Petitioner,
vs.
RUPERTO JOSE H. MATEO, represented by WARLITA MATEO, as Attorney-
in-Fact, Respondent.
DECISION
PERALTA, J.:
Before the Court is a petition for review on certiorari filed by Allied Banking
Corporation (petitioner) seeking to reverse the Decision1 dated October 21, 2004,
as well as the Order2 dated February 10, 2005 of the Regional Trial Court (RTC),
Branch 35, Santiago City, docketed as SCA No. 35-0145 for legal redemption with
prayer for a temporary restraining order and preliminary injunction.
On February 19, 1996, Ruperto Jose Mateo (respondent) obtained a loan from
petitioner in the amount of ₱950,000.00. To secure the payment of the loan,
respondent executed in favor of petitioner a deed of real estate mortgage over a
parcel of land registered in respondent’s name under Transfer Certificate of Title
(TCT) No. 236351 of the Register of Deeds of Isabela. He likewise executed a
promissory note in the amount of ₱950,000.00. Subsequently, respondent incurred
default in the payment of his loan prompting petitioner to cause the extrajudicial
foreclosure of the mortgage constituted on the subject property. The property was
sold at public auction for ₱1,531,474.53 with petitioner as the sole and highest
bidder. The Certificate of Sale was issued to petitioner, and was registered with the
Register of Deeds on July 21, 1999.
Respondent, through her attorney-in-fact, Warlita N. Mateo (Warlita), sent, on
several dates, faxed letters to petitioner signifying his desire to redeem the
foreclosed property for ₱1.1 million pesos.
On July 21, 2000, or on the last day of the period for redemption, respondent,
represented by Warlita, filed a case for legal redemption with prayer for temporary
restraining order and preliminary injunction with the RTC of Isabela.
On January 19, 2001, petitioner effected the consolidation of its ownership over
the subject property and TCT No. 311043 was issued in its name on March 2,
2001.
During the pre-trial conference on September 18, 2002, respondent offered to
redeem the property for the foreclosed amount of ₱1,531,474.53, but petitioner
refused. Instead of continuing with the trial, the parties agreed to submit the case
for summary judgment.
On October 21, 2004, the RTC rendered its Decision, the dispositive portion of
which reads:
WHEREFORE, in view of the foregoing premises, judgment is hereby rendered in
favor of the plaintiff and against the defendant, ALLOWING the plaintiff to redeem
from the defendant the property now covered by TCT No. T-311043 in the name of
the defendant, upon payment of the amount of ₱1,531,474.53, plus one (1)
percent as interest for one (1) month only, and ORDERING the defendant to
accept the tender of redemption of the plaintiff and to deliver the proper certificate
of redemption to the latter and finally, ordering the defendant to indemnify the
plaintiff ₱30,000.00 as attorney’s fees and cost of the suit.3
In so ruling, the RTC found that: (1) respondent had the right to redeem the
foreclosed property from petitioner, as the one year period to redeem had not yet
expired when respondent filed the instant case; (2) even prior to the filing of the
case, respondent had sent petitioner several faxed letters to show his sincere
desire to avail himself of the right to redeem the property from petitioner; (3)
Page 403 of 507
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respondent already offered to pay the foreclosed price of ₱1,531,474.53 as in fact
he had consigned ₱1.1 million in the Land Bank. The trial court also found that
respondent began to exercise the right to redeem on August 10, 1999 when he,
through Warlita, sent a letter to petitioner on his intention to redeem; thus, applying
Section 28, Rule 39 of the Rules of Court, respondent should pay as redemption
price the foreclosed amount of ₱1,531,474.53, plus one percent interest for the
month that lapsed until August 10, 1999.
Petitioner filed a Motion for Reconsideration, which was denied in an Order 4 dated
February 10, 2005.lavvphi1
In denying the Motion for Reconsideration, the RTC ruled that respondent’s offer of
₱1,531,474.53 made during the pre-trial conference already covered petitioner’s
bid price at the foreclosure auction sale, which already incorporated the interest,
penalties, attorney’s fees and other expenses of sale; that such purchase price
should be the basis of the redemption price, plus interest at one percent, in order
to afford respondent a greater chance to redeem the foreclosed property.
Dissatisfied, petitioner filed a petition for review on certiorari with the Court,
alleging that:
THE LOWER COURT DECIDED A QUESTION OF SUBSTANCE IN A WAY NOT
IN ACCORD WITH LAW AND WITH THE APPLICABLE DECISIONS OF THE
SUPREME COURT IN THAT:
I. It is considered sufficient tender and consignation the amount which was
less than the price for which the property was bought and in the manner
not in conformity with the law and settled jurisprudence.
II. It applied the provisions of Sec. 28, Rule 39 of the Rules of Court and
Act No. 3135 in the computation of the redemption price even when the
said basis has been superseded by Sec. 78 of the General Banking Act
(now Section 47 of RA 8791).5
Petitioner contends that: (1) the RTC erred in considering the various offers made
by respondent to redeem the subject property for the amount of ₱1.1 million as
sufficient tender of payment for purposes of redemption; (2) the tender to be legally
sufficient must be for the amount of the purchase price, plus the agreed interest
rate on the principal obligation; (3) the RTC erred in considering the deposit of
₱1.1 million with Land Bank as sufficient consignation, since the amount should
have been deposited in court and not anywhere else; (4) the offer to redeem in the
amount of ₱1,531,474.53 was made only during the pre-trial conference, which
was already way past the redemption period; and (5) the redemption price should
be based on Section 47 of the General Banking Act.
In his Comment, respondent claims that the petition should be denied outright,
because it raises questions of fact and not purely of law; that the issue as to the
sufficiency or insufficiency of the amount tendered by respondent is a question of
fact, as the Court should consider the factual evidence in relation to the
computation of the purchase price paid by petitioner during the foreclosure sale
and the price offered by respondent; that he offered to pay petitioner’s purchase
amount of ₱1,531,474.53 during the pre-trial conference; that he can still exercise
the right of redemption over the subject property; and that a previous tender of
payment and consignation is only proper but is not essential when the
redemptioner exercises his right to redeem the foreclosed property through the
filing of a judicial action within the period of redemption.
In its Reply, petitioner argues that the case was decided on stipulation of facts by
the parties; thus, any appeal from a judgment based on stipulation of facts can
only be on questions of law; that, whether under Section 28, Rule 39 of the Rules
of Court or Section 47 of the General Banking Act, the minimum redemption
amount is ₱1,531,474.53, which was the amount paid by petitioner during the
foreclosure sale.
Preliminarily, the Court would first address the procedural matter raised by
respondent: that the petition should be denied outright because it raises questions
of fact and not purely of law. Respondent claims that the issue as to the sufficiency
or insufficiency of the amount tendered by respondent is a question of fact, which
could not be raised in an appeal by certiorari under Rule 45.
We are not persuaded.
Notably, it was already stipulated upon by the parties that respondent offered ₱1.1
million as redemption price before the filing of this action; thus, the issue is not the
amount of redemption price, but the sufficiency of the amount offered by
respondent that would warrant the redemption of the foreclosed property. This is a
question of law as it calls for the correct application of law and jurisprudence on
the matter, which is within the purview of Rule 45 of the Rules of Court.1avvphi1
The Court will now address the main issues presented, to wit:
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 (1) Whether or not respondent still has the right to redeem the subject
property; and
(2) Whether or not Section 78 of the General Banking Act6 should be
applied to the computation of the redemption price.
Section 6 of Act No. 3135,7 as amended by Act No. 4118, provides for a valid
redemption, to wit:
SEC. 6. In all cases in which an extrajudicial sale is made under the special power
hereinbefore referred to, the debtor, his successors in interest or any judicial
creditor or judgment creditor of said debtor, or any person having a lien on the
property subsequent to the mortgage or deed of trust under which the property is
sold, may redeem the same at any time within the term of one year from and after
the date of sale; and such redemption shall be governed by the provisions of
sections four hundred and sixty-four to four hundred and sixty-six, inclusive,8 of the
Code of Civil Procedure, insofar as these are not inconsistent with the provisions
of this Act.
Considering that petitioner is a banking institution, the determination of the
redemption price for the foreclosed property should be governed by Section 78 of
the General Banking Act. Union Bank of the Philippines v. Court of Appeals, 9 is
instructive:
x x x Petitioner’s contention that Section 78 of the General Banking Act governs
the determination of the redemption price of the subject property is meritorious.
In Ponce de Leon v. Rehabilitation Finance Corporation, this Court had occasion to
rule that Section 78 of the General Banking Act had the effect of amending Section
6 of Act No. 3135 insofar as the redemption price is concerned when the
mortgagee is a bank, as in this case, or a banking or credit institution. The
apparent conflict between the provisions of Act No. 3135 and the General Banking
Act was, therefore, resolved in favor of the latter, being a special and subsequent
legislation. This pronouncement was reiterated in the case of Sy v. Court of
Appeals where we held that the amount at which the foreclosed property is
redeemable is the amount due under the mortgage deed, or the outstanding
obligation of the mortgagor plus interest and expenses in accordance with Section
78 of the General Banking Act. It was, therefore, manifest error on the part of the
Court of Appeals to apply in the case at bar the provisions of Section 30, Rule 39
of the Rules of Court in fixing the redemption price of the subject foreclosed
property.
And Section 78 provides:
Sec. 78. In the event of foreclosure, whether judicially or extrajudicially, of any
mortgage on real estate which is security for any loan granted before the passage
of this Act or under the provisions of this Act, the mortgagor or debtor whose real
property has been sold at public auction, judicially or extrajudicially, for the full or
partial payment of an obligation to any bank, banking or credit institution, within the
purview of this Act shall have the right, within one year after the sale of the real
estate as a result of the foreclosure of the respective mortgage, to redeem the
property by paying the amount fixed by the court in the order of execution, or the
amount due under the mortgage deed, as the case may be, with interest thereon at
the rate specified in the mortgage, and all the costs, and judicial and other
expenses incurred by the bank or institution concerned by reason of the execution
and sale and as a result of the custody of said property less the income received
from the property.
In BPI Family Savings Bank, Inc. v. Veloso,10 the Court had occasion to state the
requirements for the redemption of the foreclosed property. The Court held:
The general rule in redemption is that it is not sufficient that a person offering to
redeem manifests his desire to do so. The statement of intention must be
accompanied by an actual and simultaneous tender of payment. This constitutes
the exercise of the right to repurchase.
In several cases decided by the Court where the right to repurchase was held to
have been properly exercised, there was an unequivocal tender of payment for
the full amount of the repurchase price. Otherwise, the offer to redeem is
ineffectual. Bona fide redemption necessarily implies a reasonable and valid
tender of the entire repurchase price, otherwise the rule on the redemption
period fixed by law can easily be circumvented.11
In this case, it was stipulated upon by the parties that the real estate mortgage
over respondent’s property was foreclosed in the amount of ₱1,531,474.53, and
that respondent offered the amount of ₱1.1 million as redemption price before the
filing of the complaint. It has been held that the tender of payment must be for the
full amount of the purchase price, i.e., the amount fixed by the court in the order of
execution or the amount due under the mortgage deed, as the case may be, with
interest thereon at the rate specified in the mortgage; and all the costs, and judicial
and other expenses incurred by the bank or institution concerned by reason of the
execution and sale and as a result of the custody of said property less the income
Page 405 of 507
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received from the property. Thus, the amount of ₱1.1 million offered by respondent
was ineffective, since not only did the amount not include the interest but it was
even below the purchase price. Such offer did not effect a valid redemption, and
petitioner was justified in refusing to accept such offer.
The RTC found that the instant case for legal redemption must prosper, as the
one-year period to redeem had not yet expired when respondents filed the case.
Notably, respondents filed the instant case on July 21, 2000 which was within one
year from the registration of the Certificate of Sale on July 21, 1999. The question
now is whether such judicial redemption is proper under the circumstances.
In Hi Yield Realty, Inc v. Court of Appeals,12 the Court held:
What is the redemptioner’s option therefore when the redemption period is about
to expire and the redemption cannot take place on account of disagreement over
the redemption price?
According to jurisprudence, the redemptioner faced with such a problem may
preserve his right of redemption through judicial action which in every case must
be filed within the one-year period of redemption. The filing of the court action to
enforce redemption, being equivalent to a formal offer to redeem, would have the
effect of preserving his redemptive rights and "freezing" the expiration of the one-
year period. This is a fair interpretation provided the action is filed on time and in
good faith, the redemption price is finally determined and paid within a reasonable
time, and the rights of the parties are respected.
Stated otherwise, the foregoing interpretation, as applied to the case at bar, has
three critical dimensions: (1) timely redemption or redemption by expiration date
(or, as what happened in this case, the redemptioner was forced to resort to
judicial action to "freeze" the expiration of the redemption period); (2) good faith as
always, meaning, the filing of the private respondent’s action on August 13, 1993
must have been for the sole purpose of determining the redemption price and not
to stretch the redemptive period indefinitely; and (3) once the redemption price is
determined within a reasonable time, the redemptioner must make prompt
payment in full.
Conversely, if private respondent had to resort to judicial action to stall the
expiration of the redemptive period on August 13, 1993 because he and the
petitioner could not agree on the redemption price which still had to be determined,
private respondent could not thereby be expected to tender payment
simultaneously with the filing of the action on said date.13
As above-stated, for the action to be considered filed in good faith, the filing of the
action must have been for the sole purpose of determining the redemption price
and not to stretch the redemptive period indefinitely. In this case, it was sufficiently
shown that respondent’s offer of ₱1.1 million was even below the amount paid by
petitioner in the foreclosure sale. Notably, in petitioner’s Answer to respondent’s
complaint, it had alleged that, as of June 16, 2000, the redemption price of the
foreclosed property consisting of the amount due under the mortgage deed, the
interest specified in the mortgage and all the costs and expenses incurred by
petitioner from the sale and custody of the property already amounted to
₱2,058,825.73.14 Yet, during the pre-trial conference, respondent merely offered to
pay the amount of the auction price alone which was ₱1,531,474.53, without any
payment of interest. In fact, respondent never even consigned such amount in
court to show good faith.
It is not difficult to understand why the redemption price should either be fully
offered in legal tender or else validly consigned in court. Only by such means can
the auction winner be assured that the offer to redeem is being made in good
faith.15 Thus, the Court finds that respondent’s action for legal redemption was not
filed in good faith. It was not filed for the purpose of determining the correct
redemption price, but to stretch the redemption period indefinitely.16
WHEREFORE, the petition for review is GRANTED. The Decision dated October
21, 2004, as well as the Order dated February 10, 2005 of the Regional Trial
Court, Branch 35, Santiago City, are hereby REVERSED and SET ASIDE. The
action for legal redemption filed by respondent is hereby DISMISSED.
SO ORDERED.
G.R. No. 169568, October 22, 2014
ROLANDO ROBLES, REPRESENTED BY ATTY. CLARA C.
ESPIRITU, Petitioner, v. FERNANDO FIDEL YAPCINCO, PATROCINIO B.
YAPCINCO, MARIA CORAZON B. YAPCINCO, AND MARIA ASUNCION B.
YAPCINCO-FRONDA, Respondents.
Page 406 of 507
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 DECISION
BERSAMIN, J.:
The dispute involves the ownership of a judicially-foreclosed parcel of land sold at
a public auction, but which sale was not judicially confirmed. On one side is the
petitioner, the successor in interest of the purchaser in the public auction, and, on
the other, the heirs of the mortgagor, who never manifested interest in redeeming
the property from the time of the foreclosure.
The Case
Assailed herein are the decision and resolution of the Court of Appeals (CA)
respectively promulgated on February 24, 2005 and September 12, 2005 in CA-
G.R. No. 79824 entitled Rolando Robles, represented by Atty. Clara C. Espiritu v.
Fernando Fidel Yapcinco, et al.,1 reversing and setting aside the decision rendered
on July 7, 2003 by the Regional Trial Court, Branch 63, in Tarlac City (RTC). 2
Antecedents
The property in litis was originally registered under Transfer Certificate (TCT) No.
20458 of the Registry of Deeds of Tarlac in the name of Fernando F. Yapcinco,
married to Maxima Alcedo.3 In May 4,1944, Yapcinco constituted a mortgage on
the property in favor of Jose C. Marcelo to secure the performance of his
obligation. In turn, Marcelo transferred his rights as the mortgagee to Apolinario
Cruz on October 24, 1944.4 When Yapcinco did not pay the obligation, Apolinario
Cruz brought an action for judicial foreclosure of the mortgage in the Court of First
Instance (CFI) of Tarlac, which rendered its decision on July 27, 1956 ordering
Patrocinio Y. Kelly, the administratrix of the estate of Yapcinco, who died during
the pendency of the action, to pay Apolinario Cruz the indebtedness secured by
the mortgage plus interest; and in case of the failure to pay after 90 days from the
date of the decision, the property would be sold at a public auction,5 to
wit:ChanRoblesVirtualawlibrary
IN VIEW OF THE FOREGOING, the Court renders decision to the following effect:
A. Ordering the defendant Patrocinio Y. Kelly, as judicial administratrix of the
intestate estate of Fernando Yapcinco, to pay to Apolinario Cruz the total amount
of P6,000.00, representing the mortgage indebtedness of the defendant in favor of
plaintiff, together with interest thereon at the rate of 8% per annum payable from
May 4, 1944, until all payment thereof; and if after ninety (90) days from the date of
this decision shall have become final and executory the defendant shall not have
paid the obligation herein ordered paid, the properties mortgaged shall be sold by
the Provincial Sheriff at Public Auction, and the proceeds thereof to be applied and
disposed of in accordance with law.
B. Dismissing the third-party complaint of defendant Fernando Yapcinco against
Jose C. Marcelo; and
C. Ordering the defendant to pay the costs of this suit.
SO ORDERED.
Apolinario Cruz was adjudged the highest bidder in the public auction held on
March 18, 1959. In his favor was then issued the certificate of absolute sale, 6 and
he took possession of the property in due course. However, he did not register the
certificate of sale; nor was a judicial confirmation of sale issued.
On September 5, 1972, Apolinario Cruz donated the property to his grandchildren,
namely: Carlos C. de la Rosa, Apolinario Bernabe, Ferdinand Cruz, and petitioner
Rolando Robles.7 On August 29, 1991, however, Apolinario Bernabe falsified a
deed of absolute sale, whereby he made it appear that Yapcinco had sold the
property to him, Ma. Teresita Escopete, Orlando Santos and Oliver Puzon.8 As a
consequence, the Register of Deeds cancelled Yapcinco's TCT No. 20458 and
issued TCT No. 243719 in their names as co-vendees.9 The sale was annotated
on TCT No. 20458. It appears that another instrument dated August 28, 1991 was
annotated on TCT No. 20458 purportedly releasing and cancelling the mortgage.
Both instruments were annotated on February 11, 1992.10
On February 3, 1993, Carlos C. dela Rosa and Ferdinand Cruz, the other donees,
filed a complaint for the nullification of the contract of sale, cancellation of title and
reconveyance against Apolinario Bernabe and his co-vendees, but the case was
not aggressively pursued inasmuch as the parties were first degree cousins. 11
On January 2, 2000, the respondents, all heirs of the Spouses Yapcinco, instituted
an action against Apolinario Bernabe and his co-vendees in the Regional Trial
Court (RTC) in Tarlae City for the annulment of TCT No. 243719, document
restoration, reconveyance and damages. They claimed that although the property
had been mortgaged, the mortgage had not been foreclosed, judicially or extra-
judicially;12 that the property was released from the mortgage per Entry No. 32-
2182 in the Memorandum of Incumbrances; and that the deed of absolute sale
between Fernando Yapcinco and Bemabe, et aL. was void and ineffectual
Page 407 of 507
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because the Spouses Yapcinco had already been dead as of the date of the
sale.13
Defendants Apolinario Bernabe and his co-vendees were declared in default.
On September 13, 2001, the RTC, Branch 64, in Tarlae City rendered its judgment
declaring TCT No. 243719 and the deed of absolute sale dated
August 28, 1991 null and void. As a consequence, TCT No. 243719 was
cancelled, and TCT No. 20458 in the name of Yapcinco was restored.14
On December 17, 2002, the petitioner filed an action for the nullification of
document, cancellation of title, reconveyance and damages against the
respondents (Civil Case No. 9436).15 He averred that the heirs of Yapcinco had
acted in bad faith in causing the issuance of TCT No. 354061 because they had
known fully well that the property had long been excluded from the estate of
Yapcinco by virtue of the CFI decision dated July 27, 1956, and which the CA
affirmed on April 25, 1958; that a certificate of absolute sale was issued in the
name of Apolinario Cruz as early as 1959; and that he had a vested right in the
property pursuant to the deed of donation executed on September 5, 1972 by
Apolinario Cruz in his favor, among others.
The respondents countered that TCT No. 20458 contained an annotation to the
effect that the property had been released from the mortgage by virtue of an
instrument dated August 28, 2001; and that, in any case, the certificate of absolute
sale and the deed of donation relied upon by the petitioner were not even inscribed
in TCT No. 20458.16
Ruling of the RTC
On July 7, 2003, the RTC rendered its judgment, disposing
thusly:ChanRoblesVirtualawlibrary
WHEREFORE, judgment is hereby rendered in favor of the plaintiff by declaring
the subject land covered by TCT No. 354067 to be owned by the late Apolinario
Cruz and is part of his estate; and
1. declaring null and void TCT No. 354067 and that a new title be
issued to Apolinario Cruz. Defendants should deliver to plaintiff or
to this Court the owner's copy of TCT No. 354067; if they will not
do so after finality of this judgment, the Registry of Deeds is
nevertheless authorized to cancel TCT NO. 354067 and issue a
new one in name [the] of Apolinario Cruz, even without the
surrender of the owner's copy;chanrobleslaw
2. declaring as null and void the extra-judicial settlement of the
estate of late the Fernando Yapcinco as far as the subject land is
concerned;chanrobleslaw
3. claim for damages of both parties are denied.
SO ORDERED.17
The RTC opined that the respondents could not claim to have no knowledge that
the property in litis was no longer part of the estate of the late Fernando F.
Yapcinco; that one of them had substituted the late Fernando F. Yapcinco in the
judicial foreclosure proceedings, and even appealed the adverse decision to the
CA; that they could not argue that they were not bound by the foreclosure of the
mortgage due to the nonregistration of the certificate of sale because as between
the parties registration was not a requisite for the validity of the foreclosure; and
that they did not redeem the property until the present. 18
Decision of the CA
The respondents appealed to the CA, insisting that the RTC erred, as follows: (1)
in declaring TCT No. 354061 as null and void, and issuing a new one to Apohnario
Cruz and including the subject land in his estate; (2) in holding that res
judicata applied; (3) in not honoring that the TCT No. 20458 was free from any lien
and encumbrances; (4) in finding that they were aware of the proceedings in Civil
Case No. CA-G.R. No. 19332-R; (5) in not considering prescription, laches and
estoppels to bar the action; and (6) in not considering that they had the better right
to the property.19
On February 24, 2005, the CA promulgated its assailed decision, 20 reversing the
judgment of the RTC, and holding that due to the nonregistration of the certificate
of sale, the period of redemption did not commence to run. It also held that
Apolinario Cruz never acquired title to the property and could not have conveyed
and transferred ownership over the same to his grandchildren through the deed of
donation;21 and that contrary to the RTC's finding, Patrocinio Yapcinco's
knowledge of Apolinario Cruz' interest over the subject property was not
tantamount to registration. It found that Patrocinio Yapcinco Kelly, the
administratrix of the estate of Fernando F. Yapcinco, and Patrocinio B. Yapcinco,
Page 408 of 507
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one of the respondents, were two different persons, such that it could not be
concluded that the respondents had knowledge of the sale. Accordingly, it
concluded that the heirs of Fernando F. Yapcinco had the right to include the
property as the asset of the estate of Fernando F. Yapcinco.22
The petitioner moved for reconsideration, but on September 12, 2005, the CA
denied his motion for reconsideration, observing that there had been no order
confirming the auction sale; hence, the respondents were never divested of their
rights and interest in the property.23
Issues
In this appeal, the petitioner posits the following
issues:ChanRoblesVirtualawlibrary
I binding on the respondents as the successors-in-interest of the judgment debtor;
THE COURT OF APPEALS SERIOUSLY ERRED IN HOLDING THAT
APOLINARIO CRUZ, AS PURCHASER IN A JUDICIAL FORECLOSURE OF
SALE, NEVER ACQUIRED TITLE TO THE SUBJECT PROPERTY BY THE
MERE OMISSION TO REGISTER THE CERTIFICATE OF SALE.
II
THE COURT OF APPEALS SERIOUSLY ERRED IN DECLARING THAT
RESPONDENTS HAD NO KNOWLEDGE OF, AND THUS COULD NOT BE
BOUND BY, THE FORECLOSURE OF MORTGAGE THAT WAS EARLIER
CONDUCTED AS THE SAME WAS NOT SUPPORTED BY THE REAL FACTS
AND CIRCUMSTANCES ATTENDANT TO THE INSTANT CASE.
Ill
THE COURT OF APPEALS SERIOUSLY ERRED IN NOT HOLDING THAT
WHATEVER RIGHTS BEING CLAIMED BY THE RESPONDENTS IN THE
INSTANT CASE ARE ALREADY BARRED BY
LACHES.24chanRoblesvirtualLawlibrary
The petitioner insists that the rules and principles relied upon by the CA were
applicable only to extra-judicial foreclosure, not to a judicial foreclosure like the one
herein; that the importance of registration of the certificate of sale was true only in
extrajudicial sale where it would be the reckoning point for the exercise of the right
of redemption;25cralawred that the respondents were aware of the auction sale and
even actually participated in the proceedings leading to the foreclosure, but they
never tried to exercise their equity of redemption, before or even after the
foreclosure sale;26 that the family of Apolinario Cruz had been occupying the
property for more than 40 years from the time of the foreclosure sale; and that the
respondents should not be allowed to recover the lot on the basis of the non-
registration of the certificate of sale.
The petitioner argues that the non-registration of the certificate of sale did not
affect the title acquired by Apolinario Cruz as the purchaser in the judicial
foreclosure of mortgage;27 that the respondents' actual knowledge of the judicial
foreclosure was equivalent to automatic registration; that the doctrine of
indefeasibility of Torrens title was not absolute, and should yield to the right of
another person based on equitable principles of laches;28 that the finality of the
judgment rendered in the judicial action for foreclosure of mortgage was valid and
and that whether or not respondent Patrocinio Yapcinco and Patrocinio Yapcinco
Kelly were the same persons, or whether Patrocinio Yapcinco was only the
daughter of the latter who was the administratrix was irrelevant because the
respondents remained charged with knowledge of the foreclosure sale by virtue of
their being the successors-in-interest of the mortgagor.29
In contrast, the respondents maintain that they were lawfully entitled to the
property in litis because there was no registration of the certificate of sale or
confirmation from the court;30 that even the deed of donation executed by
Apolinario Cruz was not registered;31 that the issue revolved on whether or not
there was a valid transfer of ownership;32 and that with the release of mortgage
being validly registered in the Office of Registry of Deeds of Tarlac on February 11,
1992, thereby rendering the title free from any lien and encumbrances, they
already had the right to transfer the property in their names.33
Ruling of the Court
The petition for review is meritorious.
Before anything more, the Court clarifies that the failure of Apolinario Cruz to
register the certificate of sale was of no consequence in this adjudication. The
registration of the sale is required only in extra-judicial foreclosure sale because
the date of the registration is the reckoning point for the exercise of the right of
redemption. In contrast, the registration of the sale is superfluous in judicial
foreclosure because only the equity of redemption is granted to the mortgagor,
Page 409 of 507
Cases – Special Civil Actions (Part 1)
except in mortgages with banking institutions.34 The equity of redemption is the
right of the defendant mortgagor to extinguish the mortgage and retain ownership
of the property by paying the secured debt within the 90-day period after the
judgment becomes final, or even after the foreclosure sale but prior to the
confirmation of the sale.35In this light, it was patent error for the CA to declare that:
"By Apolinario Cruz's failure to register the 18 March 1958 Certificate of Absolute
Sale in the Office of the Register of Deeds, the period of redemption did not
commence to run."36
The applicable rule on March 18, 1959, the date of the foreclosure sale, was
Section 3, Rule 7037 of the Rules of Court, which relevantly provided that: "Such
sale shall not affect the rights of persons holding prior incumbrances upon the
property or a part thereof, and when confirmed by an order of the court, it shall
operate to divest the rights of all the parties to the action and to vest their rights in
the purchaser, subject to such rights of redemption as may be allowed by law."
The records show that no judicial confirmation of the sale was made despite the
lapse of more than 40 years since the date of the sale. Hence, it cannot be said
that title was fully vested in Apolinario Cruz.
However, the Court will not be dispensing true and effective justice if it denies the
petition for review on the basis alone of the absence of the judicial confirmation of
the sale. Although procedural rules are not to be belittled or disregarded
considering that they insure an orderly and speedy administration of justice, it is
equally true that litigation is not a game of technicalities. Law and jurisprudence
grant to the courts the prerogative to relax compliance with procedural rules of
even the most mandatory character, mindful of the duty to reconcile both the need
to speedily put an end to litigation and the parties' right to an opportunity to be
heard.38 The Rules of Court itself calls for a liberal construction of its rules with the
view of promoting their objective of securing a just, speedy and inexpensive
disposition of every action and proceeding.39
To better serve the ends of justice, the Court holds that the real issue to consider
and resolve is who between the parties had the better right to the property, not
whether there was a valid transfer of ownership to Apolinario Cruz.
It was not denied that Fernando F. Yapcinco, as the mortgagor, did not pay his
obligation, and that his default led to the filing of the action for judicial foreclosure
against him, in which he actively participated in the proceedings, and upon his
death was substituted by the administratrix of his estate. In the end, the decision in
the action for judicial foreclosure called for the holding of the public sale of the
mortgaged property. Due to the subsequent failure of the estate of Fernando F.
Yapcinco to exercise the equity of redemption, the property was sold at the public
sale, and Apolinario Cruz was declared the highest bidder. Under the
circumstances, the respondents as the successors-in-interest of Fernando F.
Yapcinco were fully bound by that decision and by the result of the ensuing
foreclosure sale.
In this regard, determining whether Patrocinio Yapcinco Kelly, the adminsitratrix of
the estate, and respondent Patrocinio Yapcinco were one and the same person
was not necessary. Even if they were not one and the same person, they were
both bound by the foreclosure proceedings by virtue of their being both
successors-in-interest of Fernando F. Yapcinco.
Although the respondents admitted the existence of the mortgage, they somehow
denied knowledge of its foreclosure. Yet, in asserting their superior right to the
property, they relied on and cited the entry dated February 11, 1992 concerning
the release of mortgage inscribed on TCT No. 20458. This duplicity the Court
cannot countenance. Being the heirs and successors-in-interest of the late
Fernando F. Yapcinco, they could not repudiate the foreclosure sale and its
consequences, and escape such consequences that bound and concluded their
predecessor-in-interest whose shoes they only stepped into.40 Given their position
on the lack of judicial confirmation of the sale in favor of Apolinario Cruz, they
should have extinguished the mortgage by exercising their equity of redemption
through paying the secured debt. They did not do so, and, instead, they sought the
annulment of TCT No. 243719 and caused the issuance of another title in their
name.
Even assuming that there was no foreclosure of the mortgage, such that the
respondents did not need to exercise the equity of redemption, the legal obligation
to pay off the mortgage indebtedness in favor of Apolinario Cruz nonetheless
devolved on them and the estate of Fernando F. Yapcinco. They could not
sincerely rely on the entry about the release or cancellation of the mortgage in TCT
No. 20458, because such entry appeared to be unfounded in the face of the lack of
any showing by them that either they or the estate of Fernando F. Yapcinco had
settled the obligation.
The petitioner did not tender any explanation for the failure of Apolinario Cruz to
secure the judicial confirmation of the sale. Fie reminds only that Apolinario Cruz
and his successors-in-interest and representatives have been in actual, notorious,
public and uninterrupted possession of the property from the time of his purchase
at the foreclosure sale until the present.
Page 410 of 507
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The effect of the failure of Apolinario Cruz to obtain the judicial confirmation was DECISION
only to prevent the title to the property from being transferred to him. For sure,
such failure did not give rise to any right in favor of the mortgagor or the VELASCO JR., J.:
respondents as his successors-in-interest to take back the property already validly
sold through public auction. Nor did such failure invalidate the foreclosure The Case
proceedings. To maintain otherwise would render nugatory the judicial foreclosure
and foreclosure sale, thus unduly disturbing judicial stability. The non-transfer of
Before Us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court
the title notwithstanding, Apolinario Cruz as the purchaser should not be deprived assailing the September 28, 2011 Decision1 and February 13, 2012 Resolution2 of
of the property purchased at the foreclosure sale. With the respondents having the Court of Appeals (CA) rendered in CA-G.R. CV No. 91424. Said rulings
been fully aware of the mortgage, and being legally bound by the judicial
dismissed petitioner Metropolitan Banking and Trust Company's (MBTC's) claim
foreclosure and consequent public sale, and in view of the unquestioned
for deficiency payment upon foreclosing respondents' mortgaged properties and
possession by Apolinario Cruz and his successors-in-interest (including the
ordered the bank, instead, to return to respondent mortgagors the excess amount
petitioner) from the time of the foreclosure sale until the present, the respondents
of PhP 722,602.22.
could not assert any better right to the property. It would be the height of inequity
to still permit them to regain the property on the basis alone of the lack of judicial
The Facts
confirmation of the sale. After all, under the applicable rule earlier cited, the judicial
confirmation operated only "to divest the rights of all the parties to the action and
The facts of the case, as culled from the records, are as
to vest their rights in the purchaser, subject to such rights of redemption as may
follows:ChanRoblesVirtualawlibrary
be allowed by law."
From February to October 1997, respondent CPR Promotions and Marketing, Inc.
Consequently, the late Fernando F. Yapcinco and the respondents as his
(CPR Promotions) obtained loans from petitioner MBTC. These loans were
successors-in-interest were divested of their right in the property, for they did not
covered by fifteen (15) promissory notes (PNs) all signed by respondents, spouses
duly exercise the equity of redemption decreed in the decision of the trial court.
Leoniza F. Reynoso and Cornelio P. Reynoso, Jr. (spouses Reynoso), as
With Yapcinco having thereby effectively ceased to be the owner of the property
Treasurer and President of CPR Promotions, respectively. The issued PNs are as
sold, the property was taken out of the mass of the assets of Yapcinco upon the
follows:
expiration of the equity of redemption.
PN No. Date Amount
WHEREFORE, the Court REVERSES and SETS ASIDE decision promulgated on 1. 277894 (BDS-143/97) February 7, 1997 P 6,50,0,000.00
February 24, 2005 by the Court of Appeals; REINSTATES the decision rendered 2. 281728 (BD-216/97) July 21, 1997 P 959,034.20
on July 7, 2003 by the Regional Trial Court, Branch 63, in Tarlac City; 3. 281735 (BD-222/97) July 31, 1997 P 508,580.83
and ORDERS the respondents to pay the costs of suit. 4. 281736 (BD-225/97) August 12, 1997 P 291,732.50
5. 281737 (BD-226/97) August 12, 1997 P 157,173.12
SO ORDERED.cralawlawlibrary 6. 281745 (BD-229/97) August 22, 1997 P 449,812.25
281747 (BDS-
7. September 3, 1997 P 105,000.00
94854.696.00.999)
8. 281749 (BD-236/97) September 11, 1997 P 525,233.93
G.R. No. 200567, June 22, 2015 9. 281750 (BD-238/97) September 12, 1997 P 1,310,099.36
10. 473410 (BD-239/97) September 19, 1997 P 251,725.00
METROPOLITAN BANK AND TRUST COMPANY, Petitioner, v. CPR
11. 473414 (BD-240/97) September 19, 1997 P 288,975.66
PROMOTIONS AND MARKETING, INC. AND SPOUSES CORNELIO P.
REYNOSO, JR. AND LEONIZA* F. REYNOSO, Respondents. 12. 473412 (BD-244/97) September 26, 1997 P 62,982.53
Page 411 of 507
Cases – Special Civil Actions (Part 1)
13. 473411 (BD-245/97) September 26, 1997 P 156,038.85
14. 473413 (BD-251/97) October 3, 1997 P 767,512.30
15. 473431 (BD-252/97) October 6, 1997 P 557,497.45
TOTAL PRINCIPAL AMOUNT 12,891,397.78
To secure the loans, the spouses Reynoso executed two deeds of real estate
mortgage on separate dates. The first mortgage, securing the amount of PhP
6,500,000, was executed on February 2, 1996 over real estate covered by
Transfer Certificate of Title (TCT) No. 624835;3 the other was executed on July 18,
1996 over properties covered by TCT Nos. 565381,4 263421,5 and 2746826 to
secure the amount of PhP 2,500,000. All of the mortgaged properties are
registered under the spouses Reynoso's names, except for TCT No. 565381,
which is registered under CPR Promotions.7chanrobleslaw
Thereafter, on December 8, 1997, the spouses Reynoso executed a continuing
surety agreement8binding themselves solidarity with CPR Promotions to pay any
and all loans CPR Promotions may have obtained from petitioner MBTC, including
those covered by the said PNs, but not to exceed PhP 13,000,000.
Upon maturity of the loans, respondents defaulted, prompting MBTC to file a
petition for extra-judicial foreclosure of the real estate mortgages, pursuant to Act
No. 3135,9 as amended. MBTC's request for foreclosure,10 dated March 6, 1998,
pertinently reads:chanRoblesvirtualLawlibrary
We have the honor to request your good Office to conduct/undertake extra-judicial
foreclosure sale proceedings under Act No. 3135, as amended, and other
applicable laws on the properties covered by two Real Estate Mortgages executed
by CPR PROMOTIONS & MARKETING INC., represented by its President Mr.
Cornelio P. Reynoso and Treasurer Leoniza F. Reynoso and SPOUSES
CORNELIO P. REYNOSO, JR., AND LEONIZA F. REYNOSO in favour of the
mortgagee, METROPOLITAN BANK AND TRUST COMPANY, to secure fifteen
(15) loans with a total principal amount of TWELVE MILLION EIGHT HUNDRED
NINETY ONE THOUSAND THREE HUNDRED NINETY SEVEN PESOS AND
SEVENTY EIGHT CENTAVOS (P12,891,397.78), for breach of the terms of said
mortgage.11chanrobleslaw
xxxx
As Annex "R", a copy of the Statement of Account, showing that the total amount
due on the loans of the borrowers/mortgagers which remains unpaid and
outstanding as of February 10, 1998 was ELEVEN MILLION TWO HUNDRED
SIXTEEN THOUSAND SEVEN HUNDRED EIGHTY TRHEE PESOS AND
NINETY NINE CENTAVOS (Pll,216,783.99) x x x.12 (emphasis in the original)
Subsequently, on May 5, 1998, the mortgaged properties covered by TCT Nos.
624835 and 565381 were sold at a public auction sale. MBTC participated therein
and submitted the highest bid in the amount of PhP 10,374,000. The day after, on
May 6, 1998, petitioner again participated and won in the public auction sale of the
remaining mortgaged properties, having submitted the highest bid amounting to
PhP 3,240,000. As a result, petitioner was issued the corresponding Certificates of
Sale on July 15 and 16, 1998, covering the properties subjected to the first and
second public auctions, respectively.
Notwithstanding the foreclosure of the mortgaged properties for the total amount of
PhP 13,614,000, petitioner MBTC alleged that there remained a deficiency
balance of PhP 2,628,520.73, plus interest and charges as stipulated and agreed
upon in the PNs and deeds of real estate mortgages. Despite petitioner's repeated
demands, however, respondents failed to settle the alleged deficiency. Thus,
petitioner filed an action for collection of sum of money against respondents,
docketed as Civil Case No. 99-230, entitled Metropolitan Bank and Trust Company
v. CPR Promotions and Marketing, Inc. and Spouses Cornelio Reynoso, Jr. and
Leoniza F. Reynoso.
Ruling of the Regional Trial Court
In its Decision13 dated October 11, 2007, the Regional Trial Court, Branch 59 in
Makati City (RTC) ruled in favor of petitioner that there, indeed, was a balance of
PhP 2,628,520.73, plus interest and charges, as of September 18, 1998, and that
respondents are liable for the said amount, as part of their contractual
obligation.14 The court disposed of the case in this
wise:chanRoblesvirtualLawlibrary
WHEREFORE, premises considered, judgment is hereby rendered ordering
[respondents], jointly and severally, to pay [petitioner] Metro bank, as
follows:ChanRoblesVirtualawlibrary
a] the amount of PhP 2,628,520.73 plus stipulated interest and penalty charges
stipulated in the Promissory Notes marked as Exhibits A to O until full payment
thereof; and
b] the costs of the suit.
SO ORDERED.chanroblesvirtuallawlibrary
Respondents timely moved for reconsideration of the RTC's Decision, which was
denied through the trial court's February 7, 2008 Order. Aggrieved, respondents
elevated the case to the CA.
Page 412 of 507
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 Ruling of the Court of Appeals
The appellate court, through the assailed Decision, reversed the court a quo and
ruled in favor of respondents. The fallo of the said Decision
reads:chanRoblesvirtualLawlibrary
Wherefore, in view of the foregoing, the decision appealed from is reversed, and
the plaintiff-appellee Metrobank is ordered to refund or return to the defendants-
appellants Cornelio and Leoniza Reynoso the amount of PhP 722,602.22
representing the remainder of the proceeds of the foreclosure sale, with legal
interest of six percent per annum from the date of filing of the answer with
counterclaim on March 26, 1999, until paid.
SO ORDERED.15
Supporting the reversal is the CA's finding that there was a sudden change in the
terminology used, from "total amount due" to "principal amount."16 According to the
CA, from February to May 1998, the amount sought to be collected ballooned from
PhP 11,216,783.99 to PhP 12,891,397.78. From this apparently unexplained
increase, the CA deduced that the increased amount must mean the principal and
interest and other charges. Furthermore, the appellate court found that petitioner
failed to prove that there was a deficiency, since the records failed to corroborate
the claimed amount. As noted by the CA, "[Petitioner] did not even introduce the
continuing surety agreement on which the trial court gratuitously based its
decision."
On October 24, 2011, petitioner filed a motion for reconsideration of the assailed
Decision, which the appellate court denied in its assailed February 13, 2012
Resolution.
The Issues
Hence this recourse, on the following issues:ChanRoblesVirtualawlibrary
Whether or not the CA gravely abused its discretion when it failed to consider the
continuing surety agreement presented in evidence and in ruling that petitioner
MBTC failed to prove that the spouses Reynoso are solidarity liable with
respondent CPR Promotions.
Whether or not the CA gravely abused its discretion when it grossly
misappreciated the promissory notes, real estate mortgages, petition for
extrajudicial foreclosure of mortgage, certificates of sale and statement of account
marked in evidence and ruled that petitioner MBTC failed to prove that a deficiency
balance resulted after conducting the extrajudicial foreclosure sales of the
mortgaged properties.
The Arguments
Anent the first issue, MBTC faults the appellate court for finding that it did not
introduce the continuing surety agreement on which the RTC based its ruling that
respondent spouses are solidarity liable with respondent CPR
Promotions.17chanrobleslaw
As regards the second issue, petitioner asserts that the CA's grant of a refund
valued at PhP 722,602.22 plus legal interest of six percent (6%) in favor of
respondents is erroneous for two reasons: first, respondents never set up a
counterclaim for refund of any amount;18 and second, the total outstanding
obligation as of February 10, 1998, to which the full amount of the bid prices was
applied, is PhP 11,216,783.99 and not PhP 12,891,397.78, which was used by the
CA in its computation.19chanrobleslaw
Lastly, petitioner claims that respondents should be made to answer for certain
specific expenses connected with the foreclosure, i.e., filing fees, publication
expense, Sheriffs Commission on Sale, stipulated attorney's fee, registration fee
for the Certificate of Sale, insurance premium and other miscellaneous expenses,
in the amounts of PhP 1,373,238 and PhP 419,166.67 for the first and second
foreclosure sales, respectively.20chanrobleslaw
In their Comment,21 respondents maintained the propriety of the CA's grant of a
refund, arguing that in their Answer with Compulsory Counterclaim, they laid-down
in detail the excess of the prices of the foreclosed properties over their
obligation.22 Respondents then went on and argued that "from the beginning of the
instant case in the trial court, [they] have already raised in issue the fact of
[petitioner's] taking-over of [their] lands with values over and above the latter's
financial liabilities."23Thus, they postulate that the CA did right when it touched on
the issue and ruled thereon.24chanrobleslaw
Furthermore, respondents insist that there is actually no difference between the
PhP 12,891,397.78 and the PhP 11,261,783.99 amounts except for the
accumulated interest, penalties, and other charges.25Too, according to them, this
is the reason why what respondent CPR owed petitioner at that time increased
substantially from that on February 10, 1998, when the amount was just PhP
11,216,783.99.26chanrobleslaw
Page 413 of 507
Cases – Special Civil Actions (Part 1)
 The Court's Ruling
We partially grant the petition. While We fully agree with the CA that MBTC was
not able to prove the amount claimed, We however, find that neither were
respondents able to timely setup their claim for refund.
Respondents belatedly raised their compulsory counterclaim
Rule 6 of the Rules of Court defines a compulsory counterclaim
follows:chanRoblesvirtualLawlibrary
Section 7. Compulsory counterclaim. — A compulsory counterclaim is one which,
being cognizable by the regular courts of justice, arises out of or is connected with
the transaction or occurrence constituting the subject matter of the opposing
party's claim and does not require for its adjudication the presence of third parties
of whom the court cannot acquire jurisdiction. Such a counterclaim must be within
the jurisdiction of the court both as to the amount and the nature thereof, except
that in an original action before the Regional Trial Court, the counterclaim may be
considered compulsory regardless of the amount.chanroblesvirtuallawlibrary
Accordingly, a counterclaim is compulsory if: (a) it arises out of or is necessarily
connected with the transaction or occurrence which is the subject matter of the
opposing party's claim; (b) it does not require for its adjudication the presence of
third parties of whom the court cannot acquire jurisdiction; and (c) the court has
jurisdiction to entertain the claim both as to its amount and nature, except that in
an original action before the RTC, the counterclaim may be considered compulsory
regardless of the amount.27chanrobleslaw
In determining whether a counterclaim is compulsory or permissive, We have, in
several cases, utilized the following tests:28chanrobleslaw
(1) Are the issues of fact or law raised by the claim and the counterclaim largely
the same?
(2) Would res judicata bar a subsequent suit on defendant's claims, absent the
compulsory counterclaim rule?
(3) Will substantially the same evidence support or refute plaintiffs claim as well as
the defendant's counterclaim?
(4) Is there any logical relation between the claim and the counterclaim, such that
the conduct of separate trials of the respective claims of the parties would entail a
substantial duplication of effort and time by the parties and the court? This test is
the "compelling test of compulsoriness."29chanrobleslaw
Based on the above tests, it is evident that a claim for recovery of the excess in the
bid price vis-a-vis the amount due should be interposed as a compulsory
counterclaim in an action for recovery of a deficiency filed by the mortgagee
against the debtor-mortgagor. First, in both cases, substantially the same evidence
is needed in order to prove their respective claim. Second, adjudication in favor of
one will necessarily bar the other since these two actions are absolutely
incompatible with each other; a debt cannot be fully paid and partially unpaid at the
same time. Third, these two opposing claims arose from the same set of
transactions. And finally, if these two claims were to be the subject of separate
trials, it would definitely entail a substantial and needless duplication of effort and
time by the parties and the court, for said actions would involve the same parties,
the same transaction, and the same evidence. The only difference here would be
in the findings of the courts based on the evidence presented with regard to the
issue of whether or not the bid prices substantially cover the amounts due.
Having determined that a claim for recovery of an excess in the bid price should be
set up in the action for payment of a deficiency as a compulsory counterclaim, We
rule that respondents failed to timely raise the same.
It is elementary that a defending party's compulsory counterclaim should be
interposed at the time he files his Answer,30 and that failure to do so shall
effectively bar such claim.31 As it appears from the records, what respondents
initially claimed herein were moral and exemplary damages, as well as attorney's
fees.32 Then, realizing, based on its computation, that it should have sought the
recovery of the excess bid price, respondents set up another counterclaim, this
time in their Appellant's Brief filed before the CA.33 Unfortunately, respondents'
belated (assertion proved fatal to their cause as it did not cure their failure to timely
raise such claim in their Answer. Consequently, respondents' claim for the excess,
if any, is already barred. With this, We now resolve the substantive issues of this
case.
The CA erred in ruling that the total amount due was PhP 12,891,397.78
Basic is the rule that a Petition for Review on Certiorari under Rule 45 of the Rules
of Court should only cover questions of law.34 Moreover, findings of fact of the CA
are generally final and conclusive and this Court will not review them on
appeal.35 This rule, however, admits of several exceptions,36 such as when the
findings of fact are conflicting, manifestly mistaken, unsupported by evidence or
the result of a misapprehension of acts, or when the findings are contrary to that of
Page 414 of 507
Cases – Special Civil Actions (Part 1)
the trial court, as in this case. 11. 473414 (BD-240/97)48 P 288,975.66
12. 473412 (BD-244/97)49 P 62,982.53
To recall, the CA, in its assailed Decision, made the following findings as regards 13. 473411 (BD-245/97)50 P 156,038.85
the amount due on the loan against which the proceeds from the auction sales are 14. 473413 (BD-251/97)51 P 767,512.30
to be applied:chanRoblesvirtualLawlibrary 15. 473431 (BD-252/97)52 P 557,497.45
In the application for extrajudicial foreclosure sale dated March 6, 1998, the total TOTAL PRINCIPAL AMOUNT 12,891,397.78
amount due as of February 10, 1998 was stated to be P11,216,783.99. The This belies the findings of the CA that PhP 12,891,397.78 is the resulting value of
plaintiff categorically declared that P11,216,783.99 was the total amount due on PhP 11,216,783.99 plus interest and other charges. Consequently, the CA's
February 10, 1998. By the time the auction sales were conducted, in May 1998, as conclusion that there is an excess of PhP 722,602.22, after deducting the amount
reflected in the certificate of Sale, the principal amount was said to be of PhP 12,891,397.78 from the total bid price of PhP 13,614,000, is erroneous.
P12,891,397.78. What is the meaning of the change from total amount due to
principal amount? If from February to May 1998, a matter of three months, the Nevertheless, while the CA's factual finding as to the amount due is flawed,
amount sought to be collected ballooned to P12,891,397.78, the increase could petitioner, as discussed below, is still not entitled to the alleged deficiency balance
have resulted from no other source than the interest and other charges under the of PhP 2,628,520.73.
promissory notes after the defendants incurred in default. Thus, the amount of
P12,891,397.78 as of May 1998, must mean the principal and interest and MBTC failed to prove that there is a deficiency balance of PhP 2,628,520.73
other charges. The statement in the certificates of sale that it is the principal
amount is a subtle change in language, a legerdemain to suggest that the amount To support its deficiency claim, petitioner presented a Statement of
does not include the interest and other charges.37 (emphasis added, citations Account,53 which refers to the amounts due as of May 5, 1998, the date of the first
omitted) foreclosure sale, to wit:chanRoblesvirtualLawlibrary
In short, the CA concluded that the amount of PhP 12,891,397.78 is actually Statement of Account as of May 05, 1998
comprised of the PhP 11,216,783.99 due as of February 10, 1998, plus additional PN No. Principal Amt Outs. PDI Penalty
interest and other charges that became due from February 10, 1998 until the date 1 BD#216/97 489,219.20 54,808.77 49,166.53
of foreclosure on May 5, 1998. 2 BD#222/97 167,289.35 18,613.61 16,310.71
3 BD#225/97 291,732.50 32,683.72 27,422.86
The appellate court is mistaken. 4 BD#226/97 44,694.50 5,007.24 4,201.28
5 BD#229/97 435,229.25 48,760.10 44,393.38
By simply adding the figures stated in the PNs as the principal sum, it can readily
be seen that the amount of PhP 12,891,397.78 actually pertains to the aggregate 6 BD#238/97 365,238.55 40,918.83 33,236.71
value of the fifteen (15) PNs, viz:chanRoblesvirtualLawlibrary 7 BD#233/97 105,000.00 11,763.50 9,082.50
PN No. Amount 8 BD#244/97 62,982.53 7,056.13 5,290.53
1. 277894 (BDS-143/97)38 P 6,500,000.00 9 BD#236/97 497,649.70 56,135.10 38,070.20
2. 281728 (BD-216/97)39 P 959,034.20 10 BD#240/97 145,950.00 16,463.20 11,165.18
3. 281735 (BD-222/97)40 P 508,580.83 11 BD#245/97 156,038.85 17,481.55 11,897.43
4. 281736 (BD-225/97)41 P 291,732.50 12 BD#239/97 210,421.50 22,605.52 15,360.77
5. 281737 (BD-226/97)42 P 157,173.12
13 BD#251/97 572,470.15 64,574.86 38,232.57
6. 281745 (BD-229/97)43 P 449,812.25
7. 281747 (BDS-94854.696.00.999)44 P 105,000.00 14 BD#252/97 557,497.45 47,896.46 31,110.63
8. 281749(BD-236/97)45 P 525,233.93 16 BDS#143/97 6,500,000.00 573,681.89 336,818.28
9. 281750 (BD-238/97)46 P 1,310,099.36 17 BDS#218/97 1,800,000.00 93,536.05 74,401.15
10. 473410 (BD-239/97)47 P 251,725.00 18 Fire Insurance 49,238.69 0.00 1,698.73
Page 415 of 507
Cases – Special Civil Actions (Part 1)
 TOTAL 12,450,652.22 1,111,986.53 747,859.44
GRAND TOTAL 14,310,498.19
Applying the proceeds from the auction sales to the foregoing amount, according
to petitioner, would result in a deficiency balance of PhP 2,443,143.43. Afterwards,
the said amount allegedly earned interest for four (4) months in the amount of PhP
185,377.30,54 bringing petitioner's claim for deficiency judgment to a total of PhP
2,628,520.73.55chanrobleslaw
We are not convinced.
We have already ruled in several cases56 that in extrajudicial foreclosure of
mortgage, where the proceeds of the sale are insufficient to pay the debt, the
mortgagee has the right to recover the deficiency from the debtor. 57 In ascertaining
the deficit amount, Sec. 4, Rule 68 of the Rules of Court is elucidating, to
wit:chanRoblesvirtualLawlibrary
Section 4. Disposition of proceeds of sale. — The amount realized from the
foreclosure sale of the mortgaged property shall, after deducting the costs of the
sale, be paid to the person foreclosing the mortgage, and when there shall be
any balance or residue, after paying off the mortgage debt due, the same shall be
paid to junior encumbrancers in the order of their priority, to be ascertained by the
court, or if there be no such encumbrancers or there be a balance or residue after
payment to them, then to the mortgagor or his duly authorized agent, or to the
person entitled to it. (emphasis added)
Verily, there can only be a deficit when the proceeds of the sale is not sufficient to
cover (1) the costs of foreclosure proceedings; and (2) the amount due to the
creditor, inclusive of interests and penalties, if any, at the time of foreclosure.
a. Petitioner failed to prove the amount due at the time of foreclosure
Having alleged the existence of a deficiency balance, it behooved petitioner to
prove, at the very least, the amount due at the date of foreclosure against which
the proceeds from the auction sale would be applied. Otherwise, there can be no
basis for awarding the claimed deficiency balance. Unfortunately for petitioner, it
failed to substantiate the amount due as of May 5, 1998 as appearing in its
Statement of Account.
To recall, MBTC admitted that the amount due as of February 10, 1998 is PhP
11,216,783.99, inclusive of interests and charges. As alleged in the
petition:chanRoblesvirtualLawlibrary
57. Firstly, it should be noted that respondents' total unpaid obligations inclusive of
interest and penalties as of 10 February 1998 amounted to Php 11,216,783.99.
This amount was the subject of petitioner Metrobank's Petitions for Extra]udicial
Foreclosure of Mortgage and NOT Php 12,891,397.78 which is the total principal
amount of respondents' loan obligations at the time when they obtained said loans
as shown in the Promissory Notes and the Certificates of Sale. After the execution
of the Promissory Notes, payments were made, although insufficient, which
resulted in the balance of PhP 11,216,783.99 as of February 1198 inclusive of
interest and penalties.58 xxx
If the total amount due as of February 10, 1998 is PhP 11,216,783.99 is already
inclusive of interests and penalties, the principal amount, exclusive of interests and
charges, would naturally be lower than the PhP 11,216,783.99 threshold. How
petitioner made the determination in its Statement of Account that the principal
amount due on the date of the auction sale is PhP 12,450,652.22 is then
questionable, nay impossible, unless respondents contracted another loan anew.
Moreover, the amounts petitioner itself supplied would result in the following
computation:chanRoblesvirtualLawlibrary
PhP
Total outstanding obligation as of February 10, 1998
11,216,783.99
1,373,238.04 Add: Alleged May 5, 1998 public auction sale expenses
(no Consistent Add: Additional interests and charges earned between
data) February 10, 1998 to May 5, 1998
(no consistent
Subtotal: Amount due as of May 5, 1998
data)
10,374,000.00 Less: May 5 Bid Price to be applied to the amount due
419,166.67 Add: Alleged May 6, 1998 public auction sale expenses
(no consisted
Add: Interests and charges earned from May 5 to 6, 1998
data)
3,240,000.00 Less: May 6 Bid Price to be applied to the amount due
PhP Total: Deficiency reflected in the Statement of Account from May 5
2,443,143.43 to September 18, 1998
As can be gleaned, petitioner failed to sufficiently explain during the proceedings
how it came up with the alleged "deficiency" in the amount of PhP 2,443,143.43,
as per the Statement of Account. Reversing the formula, petitioner's claim would
only be mathematically possible if the missing interest and penalties for the
three-month period—from February 10, 1998 to May 6, 1998—amounted to
PhP 3,047,954,73,59 which is inconsistent with MBTC's declaration in its Statement
of Account as of May 5, 1998.60 Needless to say, this amount is not only
unconscionable, it also finds no support from any of the statement of accounts and
loan stipulations agreed upon by the parties.
Page 416 of 507
Cases – Special Civil Actions (Part 1)
Given MBTC's conflicting, if not irreconcilable, allegations as to the amount due as 10. Statement of Account (Exhibit DD).chanroblesvirtuallawlibrary
of the date of foreclosure—as noted in the statement of accounts, the petition for Curiously, petitioner never offered as evidence receipts proving payment of filing
foreclosure, and the promissory notes—the computation offered by MBTC cannot
fees, publication expenses, Sheriffs Commission on Sale, attorney's fee,
be accepted at face value. Consequently, there can then be no basis for
registration fee for the Certificate of Sale, insurance premium and other
determining the value of the additional interests and penalty charges that became
miscellaneous expenses, all of which MBTC claims that it incurred. Instead,
due, and, more importantly, whether or not there was indeed a deficiency balance
petitioner urges the Court to take judicial notice of the following
at the time the mortgaged properties were foreclosed. expenses:64cralawred
May 5, 1998 auction
In addition, it is noticeable that petitioner's presentation of the computation is
sale expenses
circuitous and needlessly lengthened. As a matter of fact, nowhere in the petition,
Filing Fee PhP 52,084.00
in its complaint,61 reply,62 pre-trial brief,63among others, did it make a simple
Publication Expenses 24,267.75
computation of respondents' obligation as well as the amounts to be applied to it,
Sheriffs Commission
or even a summary thereof, when it could have easily done so. 207,560.00
on Sale
Registration fee and
b. Petitioner failed to prove the amount of expenses incurred in foreclosing
other Miscellaneous 32,644.50
the mortgaged prop erties
Expenses
Attorney's Fees (10%
Another obstacle against petitioner's claim for deficiency balance is the burden of
of total amount 1,005,744.37
proving the amount of expenses incurred during the foreclosure sales. To recall, claimed)
petitioner alleged that it incurred expenses totalling PhP 1,373,238.04 and PhP Fire Insurance 50,937.42
419,166.67 for the first and second public auction sales, respectively. However, in Sub-total PhP 1,373,238.04
claiming that there is a deficiency, petitioner only submitted the following pieces of
evidence, to wit:chanRoblesvirtualLawlibrary
May 6, 1998 auction
1. The fifteen (15) promissory notes (Exhibits A to O); sale expenses
Publication Expenses 24,267.75
2. Continuing Surety Agreement (Exhibit P);
Sheriffs Commission
64,880.00
on Sale
3. Real Estate Mortgage (Exhibits Q & R);
Registration fee and
other Miscellaneous 16,593.00
4. Petition for Sale under Act. No. 3135, as amended (Exhibit S); Expenses
Attorney's Fees (10%
5. Notices of Sheriff s Sale (Exhibits T & U);
of total amount 313,425.92
claimed)
6. Affidavits of Publication (Exhibits V & W); Sub-total PhP 419,166.67
Petitioner's argument is untenable.
7. Certificates of Posting and a Xerox copy thereof (Exhibits X & Y);
First, the Court cannot take judicial notice of the attorney's fees being claimed by
8. Certificates of Sale (Exhibits Z & AA);
petitioner because although 10% was the rate agreed upon by the parties, We
have, in a line of cases, held that the percentage to be charged can still be fixed by
9. Demand Letters (Exhibits BB & CC); and

Page 417 of 507

Cases – Special Civil Actions (Part 1)
the Court. For instance, in Mambulao Lumber Company v. Philippine National
Bank,65 the Court held:chanRoblesvirtualLawlibrary
In determining the compensation of an attorney, the following circumstances
should be considered: the amount and character of the services rendered; the
responsibility imposed; the amount of money or the value of the property affected
by the controversy, or involved in the employment; the skill and experience called
for in the performance of the service; the professional standing of the attorney; the
results secured; and whether or not the fee is contingent or absolute, it being a
recognized rule that an attorney may properly charge a much larger fee when it is
to be contingent than when it is not. From the stipulation in the mortgage contract
earlier quoted, it appears that the agreed fee is 10% of the total indebtedness,
irrespective of the manner the foreclosure of the mortgage is to be effected.
The agreement is perhaps fair enough in case the foreclosure proceedings is
prosecuted judicially but, surely, it is unreasonable when, as in this case, the
mortgage was foreclosed extra-judicially, and all that the attorney did was to
file a petition for foreclosure with the sheriff concerned. x x x (emphasis
added)
Similarly, in Bank of the Philippine Islands, Inc. v. Spouses Norman and Angelina
Yu,66 the Court reduced the claim for attorney's fees from 10% to 1% based on the
following reasons: (1) attorney's fee is not essential to the cost of borrowing, but a
mere incident of collection; (2) 1% is just and adequate because the mortgagee
bank had already charged foreclosure expenses; (3) attorney's fee of 10% of the
total amount due is onerous considering the rote effort that goes into extrajudicial
foreclosures.
Second, the Court cannot also take judicial notice of the expenses incurred by
petitioner in causing the publication of the notice of foreclosure and the cost of
insurance. This is so because there are no standard rates cited or mentioned by
petitioner that would allow Us to take judicial notice of such expenses. It is not
unthinkable that the cost of publication would vary from publisher to publisher, and
would depend on several factors, including the size of the publication space.
Insurance companies also have their own computations on the insurance
premiums to be paid by the insurer, which the courts cannot be expected to be
knowledgeable of. To be sure, in arguing for the Court to take judicial notice of the
alleged expenses, MBTC merely cited Sec. 3 of Act 3135 requiring publication and
the mortgage agreement provision on the insurance requirement, without
more.67 Said provisions never expressly provided for the actual cost of publication
and insurance, nor any formulae for determining the same. Thus, the claims for
publication and insurance expenses ought to be disallowed.
Third, the claims for registration fees and miscellaneous expenses were also never
substantiated by receipts.
In sum, given petitioner's failure to establish the sum due at the time the
mortgaged properties were foreclosed and sold via public auction, as well as the
expenses incurred in those foreclosure proceedings, it would be impossible for the
Court to determine whether or not there is, indeed, a deficiency balance petitioner
would have been entitled to.
Conclusion
In demanding payment of a deficiency in an extrajudicial foreclosure of mortgage,
proving that there is indeed one and what its exact amount is, is naturally a
precondition thereto. The same goes with a claim for reimbursement of foreclosure
expenses, as here. In this regard, it is elementary that the burden to prove a claim
rests on the party asserting such. Ei incumbit probatio qui dicit, non qui negat. He
who asserts, not he who denies, must prove.68 For having failed to adequately
substantiate its claims, We cannot sustain the finding of the trial court that
respondents are liable for the claimed deficiency, inclusive of foreclosure
expenses. Neither can We sustain the CA's finding that respondents are entitled to
the recovery of the alleged excess payment.
In light of the foregoing, the Court need not belabor the other assigned errors.
WHEREFORE, premises considered, the instant petition is hereby PARTIALLY
GRANTED. Accordingly, the Decision of the Court of Appeals dated September
28, 2011 in CA-G.R. CV No. 91424 and its February 13, 2012 Resolution are
hereby AFFIRMED with MODIFICATION. The award of refund in favor of
respondents in the amount of P722,602.22 with legal interest of six percent (6%)
per annum is hereby DELETED.
No pronouncement as to costs.
SO ORDERED.cralawlawlibrary
PARTITION
Page 418 of 507
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G.R. No. 151334 February 13, 2013
CAROLINA (CARLINA) VDA. DE FIGURACION, HEIRS OF ELENA
FIGURACION-ANCHETA, namely: LEONCIO ANCHETA, JR., and ROMULO
ANCHETA, HEIRS OF HILARIA A. FIGURACION, namely: FELIPA
FIGURACION-MANUEL, MARY FIGURACION-GINEZ, and EMILIA
FIGURACION-GERILLA, AND HEIRS OF QUINTIN FIGURACION, namely:
LINDA M. FIGURACION, LEANDRO M. FIGURACION, II, and ALLAN M.
FIGURACION, Petitioners,
vs.
EMILIA FIGURACION-GERILLA, Respondent.
DECISION
REYES, J.:
Certiorari1
At bar is a Petition for Review on under Rule 45 of the Rules of Court,
assailing the Decision2 dated December 11, 2001 of the Court of Appeals (CA) in
CA-G.R. CV No. 58290, which reversed and set aside the Decision 3 dated June
26, 1997 of the Regional Trial Court (RTC) of Urdaneta, Pangasinan, Branch 49.
The RTC decision (1) dismissed respondent Emilia Figuracion-Gerilla’s (Emilia)
complaint for partition, annulment of documents, reconveyance, quieting of title
and damages, and (2) annulled the Affidavit of Self-Adjudication executed by
petitioner Carolina (Carlina) Vda. De Figuracion (Carolina).
The Facts
The parties are the heirs of Leandro Figuracion (Leandro) who died intestate in
May 1958. Petitioner Carolina is the surviving spouse. The other petitioners –
Elena Figuracion-Ancheta, Hilaria A. Figuracion (Hilaria), Felipa Figuracion-Manuel
(Felipa), Quintin Figuracion, and Mary Figuracion-Ginez – and respondent Emilia
were Carolina and Leandro’s children.4
Subject of the dispute are two parcels of land both situated in Urdaneta,
Pangasinan, which were acquired by Leandro during his lifetime. These properties
were: (1) Lot No. 2299 with a land area of 7,547 square meters originally covered
by Transfer Certificate of Title (TCT) No. 4221-P;5 and (2) Lot No. 705 measuring
2,900 square meters and covered by TCT No. 4220-P. Both lands were registered
in the name of "Leandro Figuracion married to Carolina Adviento". Leandro
executed a Deed of Quitclaim over the above real properties in favor of his six (6)
children on August 23, 1955. Their shares, however, were not delineated with
particularity because spouses Leandro and Carolina reserved the lots and its fruits
for their expenses.
Also involved in the controversy is Lot No. 707 of the Cadastral Survey of
Urdaneta, Pangasinan, with an area of 3,164 square meters originally owned by
Eulalio Adviento (Eulalio), covered by Original Certificate of Title (OCT) No. 15867
issued in his name on August 21, 1917. Eulalio begot Agripina Adviento (Agripina)
with his first wife Marcela Estioko (Marcela), whom Eulalio survived. When he
remarried, Eulalio had another daughter, herein petitioner Carolina, with his
second wife, Faustina Escabesa (Faustina).6
On November 28, 1961, Agripina7 executed a Deed of Quitclaim8 over the eastern
half of Lot No. 707 in favor of her niece, herein respondent Emilia.
Soon thereafter or on December 11, 1962, petitioner Carolina executed
an Affidavit of Self-Adjudication9adjudicating unto herself the entire Lot No. 707 as
the sole and exclusive heir of her deceased parents, Eulalio and Faustina. 10 On
the same date, Carolina also executed a Deed of Absolute Sale11 over Lot No. 707
in favor of petitioners Hilaria and Felipa, who in turn immediately caused the
cancellation of OCT No. 15867 and the issuance of TCT No. 42244 in their
names.12
In 1971, Emilia and her family went to the United States and returned to the
Philippines only in 1981. Upon her return and relying on the Deed of Quitclaim, she
built a house on the eastern half of Lot No. 707.13
The legal debacle of the Figuracions started in 1994 when Hilaria and her agents
threatened to demolish the house of Emilia who, in retaliation, was prompted to
seek the partition of Lot No. 707 as well as Lot Nos. 2299 and 705. The matter was
initially brought before the Katarungang Pambarangay, but no amicable settlement
was reached by the parties.14 On May 23, 1994, respondent Emilia instituted the
herein Complaint15 for the partition of Lot Nos. 2299, 705 and 707, annulment of
the Affidavit of Self- Adjudication, Deed of Absolute Sale and TCT No. 42244,
reconveyance of eastern half portion of Lot No. 707, quieting of title and damages.
In opposition, the petitioners averred the following special and affirmative
defenses: (1) the respondent’s cause of action had long prescribed and that she is
guilty of laches hence, now estopped from bringing the suit; (2) TCT No. 42244 in
the name of Felipa and Hilaria have already attained indefeasibility and
Page 419 of 507
Cases – Special Civil Actions (Part 1)
conclusiveness as to the true owners of Lot No. 707; and (3) an action for partition
is no longer tenable because Felipa and Hilaria have already acquired rights
adverse to that claimed by respondent Emilia and the same amount to a
repudiation of the alleged co-ownership.16
During pre-trial conference, the issues were simplified into: (1) whether or not Lot
Nos. 2299 and 705 are the exclusive properties of Leandro; and (2) whether or not
respondent Emilia is the owner of the eastern half of Lot No. 707.17
On the basis of the evidence adduced by the parties, the RTC rendered its
Decision dated June 26, 1997 disposing as follows:
WHEREFORE, premises considered, the complaint for partition, reconveyance,
quieting of title and damages is hereby ordered dismissed whereas the affidavit of
self-adjudication[,] deed of sale and the transfer certificate of title involving Lot 707
are hereby declared null and void.
No costs.
SO ORDERED.18
The RTC ruled that a partition of Lot Nos. 2299 and 705 will be premature since
their ownership is yet to be transmitted from Leandro to his heirs whose respective
shares thereto must still be determined in estate settlement proceedings. Anent
Lot No. 707, the RTC held that petitioner Carolina transferred only her one-half (½)
share to Felipa and Hilaria and any conveyance of the other half pertaining to
Agripina was void. While the RTC nullified the Affidavit of Self-Adjudication, Deed
of Absolute Sale and TCT No. 42244, it refused to adjudicate the ownership of the
lot’s eastern half portion in favor of respondent Emilia since a settlement of the
estate of Eulalio is yet to be undertaken.19
Respondent Emilia appealed to the CA, which, in its Decision dated December 11,
2001, ruled that the RTC erred in refusing to partition Lot No. 707. The CA
explained that there is no necessity for placing Lot No. 707 under judicial
administration since Carolina had long sold her ½ pro indiviso share to Felipa and
Hilaria. Thus, when Carolina sold the entire Lot No. 707 on December 11, 1962 as
her own, the sale affected only her share and not that belonging to her co-owner,
Agripina. The proper action in such case is not the nullification of the sale, or for
the recovery of possession of the property owned in common from the third
person, but for a division or partition of the entire lot. Such partition should result in
segregating the portion belonging to the seller and its delivery to the buyer.
The CA, however, agreed with the RTC that a partition of Lot Nos. 2299 and 705 is
indeed premature considering that there is a pending legal controversy with
respect to Lot No. 705 and the accounting of the income from Lot No. 2299 and of
the expenses for the last illness and burial of Leandro and Carolina, for which the
lots appear to have been intended.
Accordingly, the decretal portion of the CA decision reads:
WHEREFORE, premises considered, the present appeal is hereby GRANTED and
the decision appealed from in Civil Case No. U-5826 is hereby VACATED and
SET ASIDE. A new judgment is hereby rendered declaring Lot No. 707 covered by
TCT No. 42244 to be owned by appellant Emilia Figuracion-Gerilla [herein
respondent], ½ pro indiviso share, appellee Felipa Figuracion [herein petitioner],
¼ pro indiviso share, and appellee Hilaria Figuracion [herein petitioner], ¼ pro
indiviso share, who are hereby directed to partition the same and if they could not
agree on a partition, they may petition the trial court for the appointment of a
commissioner to prepare a project of partition, in accordance with the procedure as
provided in Rule 69 of the 1997 Rules of Civil Procedure, as amended.
No pronouncement as to costs.
SO ORDERED.20
Respondent Emilia appealed the CA’s decision to the Court, docketed as G.R. No.
154322. In a Decision promulgated on August 22, 2006, the Court denied the
appeal, concurring with the CA’s ruling that a partition of Lot Nos. 2299 and 705
would be inappropriate considering that: (1) the ownership of Lot No. 705 is still in
dispute; and (2) there are still unresolved issues as to the expenses chargeable to
the estate of Leandro.
The present petition involves the appeal of the petitioners who attribute this sole
error committed by the CA:
THE DECISION RENDERED BY THE HONORABLE COURT OF APPEALS IS
CONTRARY TO LAW AND EXISTING JURISPRUDENTIAL DICTA LAID DOWN
BY THE HONORABLE SUPREME COURT.21
Page 420 of 507
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In view of the Court’s ruling in G.R. No. 154322, the ensuing discussion shall
concern only Lot No. 707.
The Arguments of the Parties
The petitioners argue that respondent Emilia has no valid basis for her claim of
ownership because the Deed of Quitclaim executed in her favor by Agripina was in
fact a deed of donation that contained no acceptance and thus, void. The
petitioners attached a copy of the Deed of Quitclaim and stressed on the following
portions, viz:
I, AGRIPINA ESTIOKO ADVIENTO, of le[ga]l age, Filipino citizen, single and a
resident [of] San Vicenter (sic), Urdaneta City, Pangasinan, for and in
consideration of the sum of ONE PESO ([P]1.00), Philippine Currency and the
services rendered by my niece EMILIA FIGURACION, 20 years old, single, Filipino
citizen and a resident of San Vicente, Urdaneta City, Pangasinan, do hereby by
these presentsw (sic) RENOUNCE, RELEASE and forever QUITCLAIM in favor of
EMILIA FIGURACION, her heirs, and assigns the ONE[-]HALF (1/2) eastern
portion of the following parcel of land more particularly described and bounded as
follows to wit[.]22
They further aver that the Deed of Quitclaim is riddled with defects that evoke
questions of law, because: (a) it has not been registered with the Register of
Deeds, albeit, allegedly executed as early as 1961; (b) a certification dated June 3,
2003 issued by the Office of the Clerk of Court (OCC) of the RTC of Urdaneta,
Pangasinan, shows that it does not have a copy of the Deed of Quitclaim; (c) the
Office of the National Archives which is the depository of old and new notarized
documents has no record of the Deed of Quitclaim as evidenced by a certification
dated May 19, 2003;23 and (d) Atty. Felipe V. Abenojar, who supposedly notarized
the Deed of Quitclaim was not commissioned to notarize in 1961 per the
certification dated June 9, 2003 from the OCC of the RTC of Urdaneta,
Pangasinan.24
Respondent Emilia, on the other hand, contends that the Deed of Quitclaim should
be considered an onerous donation that requires no acceptance as it is governed
by the rules on contracts and not by the formalities for a simple donation. 25
The Court’s Ruling
Issues not raised before the courts a quo cannot be raised for the first time
in a petition filed under Rule 45
Records show that there is a palpable shift in the defense raised by the petitioners
before the RTC and the CA.
In the Pre-Trial Order26 of the RTC dated April 4, 1995, the parties agreed to limit
the issue with regard to Lot No. 707 as follows: whether or not respondent Emilia is
the owner of the eastern half portion of Lot No. 707. The petitioners’ supporting
theory for this issue was that "the Deed of Quitclaim dated November 28, 1961
was rendered ineffective by the issuance of [TCT No. 42244] in the name of Felipa
and Hilaria."27 On appeal to the CA, however, the petitioners raised a new theory
by questioning the execution and enforceability of the Deed of Quitclaim. They
claimed that it is actually a donation that was not accepted in the manner required
by law.28
The inconsistent postures taken by the petitioners breach the basic procedural
tenet that a party cannot change his theory on appeal as expressly adopted in
Rule 44, Section 15 of the Rules of Court, which reads:
Sec. 15. Questions that may be raised on appeal.  Whether or not the appellant
has filed a motion for new trial in the court below, he may include in his assignment
of errors any question of law or fact that has been raised in the court below and
which is within the issues framed by the parties.
Fortifying the rule, the Court had repeatedly emphasized that defenses not
pleaded in the answer may not be raised for the first time on appeal. When a party
deliberately adopts a certain theory and the case is decided upon that theory in the
court below, he will not be permitted to change the same on appeal, because to
permit him to do so would be unfair to the adverse party. 29 The Court had likewise,
in numerous times, affirmed that points of law, theories, issues and arguments not
brought to the attention of the lower court need not be, and ordinarily will not be,
considered by a reviewing court, as these cannot be raised for the first time at
such late stage. Basic considerations of due process underlie this rule. It would be
unfair to the adverse party who would have no opportunity to present further
evidence material to the new theory, which it could have done had it been aware of
it at the time of the hearing before the trial court.30
While a party may change his theory on appeal when the factual bases thereof
would not require presentation of any further evidence by the adverse party in
Page 421 of 507
Cases – Special Civil Actions (Part 1)
order to enable it to properly meet the issue raised in the new theory, 31this
exception does not, however, obtain in the case at hand.
Contrary to the petitioners’ assertion, the Court finds that the issues on the
supposed defects and actual nature of the Deed of Quitclaim are questions of fact
that require not only a review or re-evaluation of the evidence already adduced by
the parties but also the reception of new evidence as the petitioners themselves
have acknowledged when they attached in the petition several certifications 32 in
support of their new argument. It is settled that questions of fact are beyond the
province of a Rule 45 petition since the Court is not a trier of facts. 33
Accordingly, the Court will not give due course to the new issues raised by the
petitioners involving the nature and execution of the Deed of Quitclaim. For their
failure to advance these questions during trial, the petitioners are now barred by
estoppel34 from imploring an examination of the same.
The respondent can compel the
partition of Lot No. 707
The first stage in an action for partition is the settlement of the issue of ownership.
Such an action will not lie if the claimant has no rightful interest in the subject
property. In fact, the parties filing the action are required by the Rules of Court to
set forth in their complaint the nature and the extent of their title to the property. It
would be premature to effect a partition until and unless the question of ownership
is first definitely resolved.35
Here, the respondent traces her ownership over the eastern half of Lot No. 707
from the Deed of Quitclaim executed by Agripina, who in turn, was the co-owner
thereof being one of the legitimate heirs of Eulalio. It is well to recall that the
petitioners failed to categorically dispute the existence of the Deed of Quitclaim.
Instead, they averred that it has been rendered ineffective by TCT No. 42244 in
the name of Felipa and Hilaria―this contention is, of course, flawed.
Mere issuance of a certificate of title in the name of any person does not foreclose
the possibility that the real property may be under coownership with persons not
named in the certificate, or that the registrant may only be a trustee, or that other
parties may have acquired interest over the property subsequent to the issuance of
the certificate of title.36 Stated differently, placing a parcel of land under the mantle
of the Torrens system does not mean that ownership thereof can no longer be
disputed. The certificate cannot always be considered as conclusive evidence of
ownership.37 In this case, co-ownership of Lot No. 707 was precisely what
respondent Emilia was able to successfully establish, as correctly found by
the RTC and affirmed by the CA.
The status of Agripina and Carolina as the legitimate heirs of Eulalio is an
undisputed fact. As such heirs, they became co-owners of Lot No. 707 upon the
death of Eulalio on July 20, 1930. Since Faustina was predeceased by Eulalio, she
likewise became a co-owner of the lot upon Eulalio’s death. Faustina’s share,
however, passed on to her daughter Carolina when the former died on October 18,
1949. The Affidavit of Self-Adjudication executed by Carolina did not prejudice the
share of Agripina because it is not legally possible for one to adjudicate unto
himself an entire property he was not the sole owner of. A co-owner cannot
alienate the shares of her other co-owners – nemo dat qui non habet.38
Hence, Lot No. 707 was a co-owned property of Agripina and Carolina. As co-
owners, each of them had full ownership of her part and of the fruits and benefits
pertaining thereto. Each of them also had the right to alienate the lot but only in so
far as the extent of her portion was affected.39
Thus, when Carolina sold the entire Lot No. 707 on December 11, 1962 to Hilaria
and Felipa without the consent of her co-owner Agripina, the disposition affected
only Carolina’s pro indiviso share, and the vendees, Hilaria and Felipa, acquired
only what corresponds to Carolina’s share. A co-owner is entitled to sell his
undivided share; hence, a sale of the entire property by one co-owner without the
consent of the other co-owners is not null and void and only the rights of the co-
owner/seller are transferred, thereby making the buyer a co-owner of the
property.40
Accordingly, the deed of sale executed by Carolina in favor of Hilaria and Felipa
was a valid conveyance but only insofar as the share of Carolina in the co-
ownership is concerned. As Carolina’s successors-in-interest to the property,
Hilaria and Felipa could not acquire any superior right in the property than what
Carolina is entitled to or could transfer or alienate after partition.
In a contract of sale of co-owned property, what the vendee obtains by virtue of
such a sale are the same rights as the vendor had as co-owner, and the vendee
merely steps into the shoes of the vendor as co-owner.41 Hilaria and Felipa did not
acquire the undivided portion pertaining to Agripina, which has already been
effectively bequeathed to respondent Emilia as early as November 28, 1961 thru
the Deed of Quitclaim. In turn, being the successor-in-interest of Agripina’s share
Page 422 of 507
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in Lot No. 707, respondent Emilia took the former’s place in the co-ownership and
as such co-owner, has the right to compel partition at any time.42
The respondent’s right to demand
for partition is not barred by
acquisitive prescription or laches
The petitioners posit that the issuance of TCT No. 42244 in the name of Hilaria
and Felipa over Lot No. 707 on December 11, 1962 was an express repudiation of
the co-ownership with respondent Emilia. Considering the period of time that has
already lapsed since then, acquisitive prescription has already set in and the
respondent is now barred by laches from seeking a partition of the subject lot.
The contention is specious.
Co-heirs or co-owners cannot acquire by acquisitive prescription the share of the
other co-heirs or co-owners absent a clear repudiation of the co ownership.43 The
act of repudiation, as a mode of terminating co-ownership, is subject to certain
conditions, to wit: (1) a co-owner repudiates the co-ownership; (2) such an act of
repudiation is clearly made known to the other co-owners; (3) the evidence thereon
is clear and conclusive; and (4) he has been in possession through open,
continuous, exclusive, and notorious possession of the property for the period
required by law.44
The petitioners failed to comply with these conditions. The act of Hilaria and Felipa
in effecting the registration of the entire Lot No. 707 in their names thru TCT No.
42244 did not serve to effectively repudiate the co-ownership. The respondent built
her house on the eastern portion of the lot in 1981 without any opposition from the
petitioners. Hilaria also paid realty taxes on the lot, in behalf of the respondent, for
the years 1983-1987.45 These events indubitably show that Hilaria and Felipa
failed to assert exclusive title in themselves adversely to Emilia. Their acts clearly
manifest that they recognized the subsistence of their co-ownership with
respondent Emilia despite the issuance of TCT No. 42244 in 1962. Their acts
constitute an implied recognition of the co-ownership which in turn negates the
presence of a clear notice of repudiation to the respondent. To sustain a plea of
prescription, it must always clearly appear that one who was originally a joint
owner has repudiated the claims of his co-owners, and that his co-owners were
apprised or should have been apprised of his claim of adverse and exclusive
ownership before the alleged prescriptive period began to run.46
In addition, when Hilaria and Felipa registered the lot in their names to the
exclusion of Emilia, an implied trust was created by force of law and the two of
them were considered a trustee of the respondent’s undivided share.47 As trustees,
they cannot be permitted to repudiate the trust by relying on the registration.
In Ringor v. Ringor,48 the Court had the occasion to explain the reason for this rule:
A trustee who obtains a Torrens title over a property held in trust for him by
another cannot repudiate the trust by relying on the registration. A Torrens
Certificate of Title in Jose’s name did not vest ownership of the land upon him. The
Torrens system does not create or vest title. It only confirms and records title
already existing and vested. It does not protect a usurper from the true owner. The
Torrens system was not intended to foment betrayal in the performance of a trust.
It does not permit one to enrich himself at the expense of another. Where one
does not have a rightful claim to the property, the Torrens system of registration
can confirm or record nothing. Petitioners cannot rely on the registration of the
lands in Jose’s name nor in the name of the Heirs of Jose M. Ringor, Inc., for the
wrong result they seek. For Jose could not repudiate a trust by relying on a
Torrens title he held in trust for his co-heirs.1âwphi1 The beneficiaries are entitled
to enforce the trust, notwithstanding the irrevocability of the Torrens title. The
intended trust must be sustained.49 (Citations omitted and emphasis ours)
Further, records do not reflect conclusive evidence showing the manner of
occupation and possession exercised by Hilaria and Felipa over the lot from the
time it was registered in their names. The only evidence of possession extant in
the records dates back only to 1985 when Hilaria and Felipa declared the lot in
their names for taxation purposes.50 Prescription can only produce all its effects
when acts of ownership, or in this case, possession, do not evince any doubt as to
the ouster of the rights of the other co-owners. Hence, prescription among co-
owners cannot take place when acts of ownership exercised are vague or
uncertain.51
Moreover, the evidence relative to the possession, as a fact upon which the
alleged prescription is based, must be clear, complete and conclusive in order to
establish said prescription without any shadow of doubt; and when upon trial it is
not shown that the possession of the claimant has been adverse and exclusive
and opposed to the rights of the others, the case is not one of ownership, and
partition will lie.52 The petitioners failed to muster adequate evidence of possession
essential for the reckoning of the 10-year period for acquisitive prescription.
Page 423 of 507
Cases – Special Civil Actions (Part 1)
The express disavowal of the co-ownership did not happen on December 11, 1962
when TCT No. 42244 was issued but in 1994 when Hilaria attempted to demolish
Emilia’s house thus explicitly excluding her from the co-ownership. It was the only
time that Hilaria and Felipa made known their denial of the co-ownership. On the
same year, the respondent instituted the present complaint for partition; hence, the
period required by law for acquisitive period to set in was not met.
Anent laches, the Court finds it unavailing in this case in view of the proximity of
the period when the co-ownership was expressly repudiated and when the herein
complaint was filed. Laches is the negligence or omission to assert a right within a
reasonable time, warranting a presumption that the party entitled to assert it has
abandoned it or declined to assert it.53 More so, laches is a creation of equity and
its application is controlled by equitable considerations. It cannot be used to defeat
justice or perpetrate fraud and injustice. Neither should its application be used to
prevent the rightful owners of a property from recovering what has been
fraudulently registered in the name of another.54
Partition of Lot No. 707
Under the Old Civil Code55 which was then in force at the time of Eulalio and
Marcela’s marriage, Lot No. 707 was their conjugal property. 56 When Marcela died,
one-half of the lot was automatically reserved to Eulalio, the surviving spouse, as
his share in the conjugal partnership.57 Marcela’s rights to the other half, in turn,
were transmitted to her legitimate child, Agripina and surviving spouse
Eulalio.58 Under Article 834 of the Old Civil Code, Eulalio was entitled only to the
usufruct of the lot while the naked ownership belonged to Agripina. When he
remarried, Eulalio’s one half portion of the lot representing his share in the
conjugal partnership and his usufructuary right over the other half were brought
into his second marriage with Faustina.59
When Eulalio died on July 20, 1930, ¼ portion of the lot was reserved for Faustina
as her share in the conjugal partnership.60 The remaining ¼ were transmitted
equally to the widow Faustina and Eulalio’s children, Carolina and Agripina.61
However, Faustina is only entitled to the usufruct of the third available for
betterment.62
The usufructuary of Eulalio over the ½ portion inherited by Agripina earlier was
merged with her naked ownership.63Upon the death of Faustina, the shares in Lot
No. 707 which represents her share in the conjugal partnership and her inheritance
from Eulalio were in turn inherited by Carolina64 including Faustina’s usufructuary
rights which were merged with Carolina’s naked ownership.65
Consequently, Agripina is entitled to 5/8 portion of Lot No. 707 while the remaining
3/8 pertains to Carolina. Thus, when Carolina sold Lot No. 707 to Hilaria and
Felipa, the sale affected only 3/8 portion of the subject lot. Since the Deed of
Quitclaim, bequeathed only the ½ eastern portion of Lot No. 707 in favor of Emilia
instead of Agripina’s entire 5/8 share thereof, the remaining 1/8 portion shall be
inherited by Agripina’s nearest collateral relative,66 who, records show, is her sister
Carolina.
In sum, the CA committed no reversible error in holding that the respondent is
entitled to have Lot No. 707 partitioned. The CA judgment must, however, be
modified to conform to the above-discussed apportionment of the lot among
Carolina, Hilaria, Felipa and Emilia.
WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals in
CA-G.R. CV No. 58290 dated December 11, 2001, is AFFIRMED with
MODIFICATIONS as follows: (1) 3/8 portion of Lot No. 707 shall pertain in equal
shares to Hilaria Figuracion and Felipa Figuracion-Manuel; (2) ½ portion of Lot.
No. 707 shall pertain to Emilia Figuracion-Gerilla; and (3) 1/8 portion of Lot No.
707 shall pertain to the estate of Carolina (Carlina) Vda. De Figuracion. The case
is REMANDED to the Regional Trial Court of Urdaneta, Pangasinan, Branch 49,
who is directed to conduct a PARTITION BY COMMISSIONERS and effect the
actual physical partition of the subject property, as well as the improvements that
lie therein, in the foregoing manner. The trial court is DIRECTED to appoint not
more than three (3) competent and disinterested persons, who should determine
the technical metes and bounds of the property and the proper share appertaining
to each co-owner, including the improvements, in accordance with Rule 69 of the
Rules of Court. When it is made to appear to the commissioners that the real
estate, or a portion thereof, cannot be divided without great prejudice to the
interest of the parties, the court a quo may order it assigned to one of the parties
willing to take the same, provided he pays to the other parties such sum or sums of
money as the commissioners deem equitable, unless one of the parties interested
ask that the property be sold instead of being so assigned, in which case the court
shall order the commissioners to sell the real estate at public sale, and the
commissioners shall sell the same accordingly, and thereafter distribute the
proceeds of the sale appertaining to the just share of each co-owner. No
pronouncement as to costs.
Page 424 of 507
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SO ORDERED.
[G.R. No. 168970 : January 15, 2010]
CELESTINO BALUS, PETITIONER, VS. SATURNINO BALUS AND LEONARDA
BALUS VDA. DE CALUNOD, RESPONDENTS.
DECISION
PERALTA, J.:
Assailed in the present petition for review on certiorari under Rule 45 of the Rules
of Court is the Decision[1] of the Court of Appeals (CA) dated May 31, 2005 in CA-
G.R. CV No. 58041 which set aside the February 7, 1997 Decision of the Regional
Trial Court (RTC) of Lanao del Norte, Branch 4 in Civil Case No. 3263.
The facts of the case are as follows:
Herein petitioner and respondents are the children of the spouses Rufo and
Sebastiana Balus. Sebastiana died on September 6, 1978, while Rufo died on July
6, 1984.
On January 3, 1979, Rufo mortgaged a parcel of land, which he owns, as security
for a loan he obtained from the Rural Bank of Maigo, Lanao del Norte (Bank). The
said property was originally covered by Original Certificate of Title No. P-439(788)
and more particularly described as follows:
A parcel of land with all the improvements thereon, containing an area of 3.0740
hectares, more or less, situated in the Barrio of Lagundang, Bunawan, Iligan City,
and bounded as follows: Bounded on the NE., along line 1-2, by Lot 5122, Csd-
292; along line 2-12, by Dodiongan River; along line 12-13 by Lot 4649, Csd-292;
and along line 12-1, by Lot 4661, Csd-292. x x x [2]
Rufo failed to pay his loan. As a result, the mortgaged property was foreclosed and
was subsequently sold to the Bank as the sole bidder at a public auction held for
that purpose. On November 20, 1981, a Certificate of Sale[3] was executed by the
sheriff in favor of the Bank. The property was not redeemed within the period
allowed by law. More than two years after the auction, or on January 25, 1984, the
sheriff executed a Definite Deed of Sale[4] in the Bank's favor. Thereafter, a new
title was issued in the name of the Bank.
On October 10, 1989, herein petitioner and respondents executed an Extrajudicial
Settlement of Estate[5]adjudicating to each of them a specific one-third portion of
the subject property consisting of 10,246 square meters. The Extrajudicial
Settlement also contained provisions wherein the parties admitted knowledge of
the fact that their father mortgaged the subject property to the Bank and that they
intended to redeem the same at the soonest possible time.
Three years after the execution of the Extrajudicial Settlement, herein respondents
bought the subject property from the Bank. On October 12, 1992, a Deed of Sale
of Registered Land[6] was executed by the Bank in favor of respondents.
Subsequently, Transfer Certificate of Title (TCT) No. T-39,484(a.f.)[7] was issued in
the name of respondents. Meanwhile, petitioner continued possession of the
subject lot.
On June 27, 1995, respondents filed a Complaint[8] for Recovery of Possession
and Damages against petitioner, contending that they had already informed
petitioner of the fact that they were the new owners of the disputed property, but
the petitioner still refused to surrender possession of the same to them.
Respondents claimed that they had exhausted all remedies for the amicable
settlement of the case, but to no avail.
On February 7, 1997, the RTC rendered a Decision[9] disposing as follows:
WHEREFORE, judgment is hereby rendered, ordering the plaintiffs to execute a
Deed of Sale in favor of the defendant, the one-third share of the property in
question, presently possessed by him, and described in the deed of partition, as
follows:
A one-third portion of Transfer Certificate of Title No. T-39,484 (a.f.), formerly
Original Certificate of Title No. P-788, now in the name of Saturnino Balus and
Leonarda B. Vda. de Calunod, situated at Lagundang, Bunawan, Iligan City,
bounded on the North by Lot 5122; East by shares of Saturnino Balus and
Leonarda Balus-Calunod; South by Lot 4649, Dodiongan River; West by Lot 4661,
consisting of 10,246 square meters, including improvements thereon.
and dismissing all other claims of the parties.
The amount of P6,733.33 consigned by the defendant with the Clerk of Court is
Page 425 of 507
Cases – Special Civil Actions (Part 1)
hereby ordered delivered to the plaintiffs, as purchase price of the one-third portion
of the land in question.
Plaintiffs are ordered to pay the costs.
SO ORDERED.[10]
The RTC held that the right of petitioner to purchase from the respondents his
share in the disputed property was recognized by the provisions of the Extrajudicial
Settlement of Estate, which the parties had executed before the respondents
bought the subject lot from the Bank.
Aggrieved by the Decision of the RTC, herein respondents filed an appeal with the
CA.
On May 31, 2005, the CA promulgated the presently assailed Decision, reversing
and setting aside the Decision of the RTC and ordering petitioner to immediately
surrender possession of the subject property to the respondents. The CA ruled that
when petitioner and respondents did not redeem the subject property within the
redemption period and allowed the consolidation of ownership and the issuance of
a new title in the name of the Bank, their co-ownership was extinguished.
Hence, the instant petition raising a sole issue, to wit:
WHETHER OR NOT CO-OWNERSHIP AMONG THE PETITIONER AND THE
RESPONDENTS OVER THE PROPERTY PERSISTED/CONTINUED TO EXIST
(EVEN AFTER THE TRANSFER OF TITLE TO THE BANK) BY VIRTUE OF THE
PARTIES' AGREEMENT PRIOR TO THE REPURCHASE THEREOF BY THE
RESPONDENTS; THUS, WARRANTING THE PETITIONER'S ACT OF
ENFORCING THE AGREEMENT BY REIMBURSING THE RESPONDENTS OF
HIS (PETITIONER'S) JUST SHARE OF THE REPURCHASE PRICE.[11]
The main issue raised by petitioner is whether co-ownership by him and
respondents over the subject property persisted even after the lot was purchased
by the Bank and title thereto transferred to its name, and even after it was
eventually bought back by the respondents from the Bank.
Petitioner insists that despite respondents' full knowledge of the fact that the title
over the disputed property was already in the name of the Bank, they still
proceeded to execute the subject Extrajudicial Settlement, having in mind the
intention of purchasing back the property together with petitioner and of continuing
their co-ownership thereof.
Petitioner posits that the subject Extrajudicial Settlement is, in and by itself, a
contract between him and respondents, because it contains a provision whereby
the parties agreed to continue their co-ownership of the subject property by
"redeeming" or "repurchasing" the same from the Bank. This agreement, petitioner
contends, is the law between the parties and, as such, binds the respondents. As a
result, petitioner asserts that respondents' act of buying the disputed property from
the Bank without notifying him inures to his benefit as to give him the right to claim
his rightful portion of the property, comprising 1/3 thereof, by reimbursing
respondents the equivalent 1/3 of the sum they paid to the Bank.
The Court is not persuaded.
Petitioner and respondents are arguing on the wrong premise that, at the time of
the execution of the Extrajudicial Settlement, the subject property formed part of
the estate of their deceased father to which they may lay claim as his heirs.
At the outset, it bears to emphasize that there is no dispute with respect to the fact
that the subject property was exclusively owned by petitioner and respondents'
father, Rufo, at the time that it was mortgaged in 1979. This was stipulated by the
parties during the hearing conducted by the trial court on October 28,
1996.[12] Evidence shows that a Definite Deed of Sale[13] was issued in favor of the
Bank on January 25, 1984, after the period of redemption expired. There is neither
any dispute that a new title was issued in the Bank's name before Rufo died on
July 6, 1984. Hence, there is no question that the Bank acquired exclusive
ownership of the contested lot during the lifetime of Rufo.
The rights to a person's succession are transmitted from the moment of his
death.[14] In addition, the inheritance of a person consists of the property and
transmissible rights and obligations existing at the time of his death, as well as
those which have accrued thereto since the opening of the succession. [15] In the
present case, since Rufo lost ownership of the subject property during his lifetime,
it only follows that at the time of his death, the disputed parcel of land no longer
formed part of his estate to which his heirs may lay claim. Stated differently,
petitioner and respondents never inherited the subject lot from their father.
Petitioner and respondents, therefore, were wrong in assuming that they became
co-owners of the subject lot. Thus, any issue arising from the supposed right of
petitioner as co-owner of the contested parcel of land is negated by the fact that, in
Page 426 of 507
Cases – Special Civil Actions (Part 1)
the eyes of the law, the disputed lot did not pass into the hands of petitioner and
respondents as compulsory heirs of Rufo at any given point in time.
The foregoing notwithstanding, the Court finds a necessity for a complete
determination of the issues raised in the instant case to look into petitioner's
argument that the Extrajudicial Settlement is an independent contract which gives
him the right to enforce his right to claim a portion of the disputed lot bought by
respondents.
It is true that under Article 1315 of the Civil Code of the Philippines, contracts are
perfected by mere consent; and from that moment, the parties are bound not only
to the fulfillment of what has been expressly stipulated but also to all the
consequences which, according to their nature, may be in keeping with good faith,
usage and law.
Article 1306 of the same Code also provides that the contracting parties may
establish such stipulations, clauses, terms and conditions as they may deem
convenient, provided these are not contrary to law, morals, good customs, public
order or public policy.
In the present case, however, there is nothing in the subject Extrajudicial
Settlement to indicate any express stipulation for petitioner and respondents to
continue with their supposed co-ownership of the contested lot.
On the contrary, a plain reading of the provisions of the Extrajudicial Settlement
would not, in any way, support petitioner's contention that it was his and his
sibling's intention to buy the subject property from the Bank and continue what
they believed to be co-ownership thereof. It is a cardinal rule in the interpretation of
contracts that the intention of the parties shall be accorded primordial
consideration.[16]It is the duty of the courts to place a practical and realistic
construction upon it, giving due consideration to the context in which it is
negotiated and the purpose which it is intended to serve.[17] Such intention is
determined from the express terms of their agreement, as well as their
contemporaneous and subsequent acts.[18] Absurd and illogical interpretations
should also be avoided.[19]
For petitioner to claim that the Extrajudicial Settlement is an agreement between
him and his siblings to continue what they thought was their ownership of the
subject property, even after the same had been bought by the Bank, is stretching
the interpretation of the said Extrajudicial Settlement too far.
In the first place, as earlier discussed, there is no co-ownership to talk about and
no property to partition, as the disputed lot never formed part of the estate of their
deceased father.
Moreover, petitioner's asseveration of his and respondents' intention of continuing
with their supposed co-ownership is negated by no less than his assertions in the
present petition that on several occasions he had the chance to purchase the
subject property back, but he refused to do so. In fact, he claims that after the
Bank acquired the disputed lot, it offered to re-sell the same to him but he ignored
such offer. How then can petitioner now claim that it was also his intention to
purchase the subject property from the Bank, when he admitted that he refused
the Bank's offer to re-sell the subject property to him?
In addition, it appears from the recitals in the Extrajudicial Settlement that, at the
time of the execution thereof, the parties were not yet aware that the subject
property was already exclusively owned by the Bank. Nonetheless, the lack of
knowledge on the part of petitioner and respondents that the mortgage was
already foreclosed and title to the property was already transferred to the Bank
does not give them the right or the authority to unilaterally declare themselves as
co-owners of the disputed property; otherwise, the disposition of the case would be
made to depend on the belief and conviction of the party-litigants and not on the
evidence adduced and the law and jurisprudence applicable thereto.
Furthermore, petitioner's contention that he and his siblings intended to continue
their supposed co-ownership of the subject property contradicts the provisions of
the subject Extrajudicial Settlement where they clearly manifested their intention of
having the subject property divided or partitioned by assigning to each of the
petitioner and respondents a specific 1/3 portion of the same. Partition calls for the
segregation and conveyance of a determinate portion of the property owned in
common. It seeks a severance of the individual interests of each co-owner, vesting
in each of them a sole estate in a specific property and giving each one a right to
enjoy his estate without supervision or interference from the other. [20] In other
words, the purpose of partition is to put an end to co-ownership,[21] an objective
which negates petitioner's claims in the present case.
WHEREFORE, the instant petition is DENIED. The assailed Decision of the Court
of Appeals, dated May 31, 2005 in CA-G.R. CV No. 58041, is AFFIRMED.
SO ORDERED.
Page 427 of 507
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G.R. No. 161746 September 1, 2010
EUGENIO FELICIANO, substituted by his wife CEFERINA DE PALMA-
FELICIANO, ANGELINA DE LEON, representing the heirs of ESTEBAN
FELICIANO, TRINIDAD VALIENTE, AND BASILIA TRINIDAD, represented by
her son DOMINADOR T. FELICIANO, Petitioners,
vs.
PEDRO CANOZA, DELIA FELICIANO, ROSAURO FELICIANO, ELSA
FELICIANO AND PONCIANO FELICIANO, Respondents.
DECISION
VILLARAMA, JR., J.:
Before the Court is a petition for review on certiorari under Rule 45 of the 1997
Rules of Civil Procedure, as amended, seeking to annul and set aside the
Decision1 dated June 26, 2003 and Resolution2 dated January 15, 2004 of the
Court of Appeals (CA) in CA-G.R. CV No. 61888. The CA had reversed the
Decision3 dated August 3, 1998 of the Regional Trial Court (RTC) of Malolos,
Bulacan, Branch 11, in Civil Case No. 819-M-93 and dismissed petitioners’
complaint on the ground of prescription.
The facts are as follows:
When Antonio Feliciano passed away on May 20, 1930, he left behind his only
property, a parcel of land located at Bunga4 Mayor, Bustos, Bulacan. The land had
an area of 1,125 square meters and was evidenced by Tax Declaration No.
14025 in his name. On March 28, 1972, Leona, Maria, Pedro and Salina, all
surnamed Feliciano, declared themselves to be the only surviving heirs of Antonio
Feliciano, with the exception of Salina. They executed an extrajudicial settlement
of Antonio Feliciano’s estate6 and appropriated among themselves the said parcel
of land, to the exclusion of the heirs of Esteban Feliciano and Doroteo Feliciano,
deceased children of Antonio Feliciano. On even date, Leona, Maria, Pedro and
Salina executed a deed of absolute sale or Kasulatan sa Ganap Na Bilihan over
the property in favor of the late Jacinto Feliciano (Pedro’s portion), Felisa Feliciano
(Salina’s portion) and Pedro Canoza (Leona and Maria’s portions). 7
During his lifetime, Jacinto Feliciano applied for a free patent over the portion of
land he bought, declaring that the same was a public land, first occupied and
cultivated by Pedro Feliciano.8 Jacinto was issued Free Patent No. (IV-4) 012293
on November 28, 19779 and the same was forwarded to the Register of Deeds of
Malolos, Bulacan, but unfortunately, it was burned on March 7, 1987. Pedro
Canoza, for his part, also applied for a free patent over the portion of land which he
bought, claiming that the same was public land, first occupied and cultivated by
Leona and Maria Feliciano.10 He was issued Free Patent No. (IV-4) 012292, now
covered by Original Certificate of Title (OCT) No. P-364,11 on February 23, 1979.
On October 18, 1993, Eugenio Feliciano and Angelina Feliciano-de Leon, surviving
heirs of the late Esteban Feliciano, and Trinidad Feliciano-Valiente and Basilia
Feliciano-Trinidad, surviving children of the late Doroteo Feliciano, filed a
complaint12 against Salina Feliciano, Felisa Feliciano, Pedro Canoza and the heirs
of the late Jacinto Feliciano, namely Delia, Rosauro, Elsa, Nardo and Ponciano, all
surnamed Feliciano, for the Declaration of Nullity of Documents and Title,
Recovery of Real Property and Damages. They alleged that the settlement of the
estate and sale were done without their participation and consent as heirs of
Esteban and Doroteo. Likewise, they averred that the ancestral home of the
Felicianos is erected on the subject property and that they have occupied the
same since birth. Canoza and Jacinto falsely declared that the property was not
occupied, so their titles to the property should be declared null and void on the
ground that they have made false statements in their respective applications for
free patent.
On November 4, 1993, before an Answer could be filed, the petitioners amended
their complaint to include the allegation that they sought to recover the shares of
their fathers, Esteban and Doroteo, which they could have acquired as heirs of
Antonio Feliciano.13
In their Answer,14 respondent Pedro Canoza and his spouse, respondent Delia
Feliciano, alleged that they were buyers in good faith and for value. They likewise
contended that assuming that there was preterition of legal heirs, they never took
part in it. As affirmative defenses, they alleged that the complaint failed to state a
cause of action; the lower court had no jurisdiction as the subject of the case were
free patents and therefore prior exhaustion of administrative remedies was
required; the case was prematurely filed; no effort was exerted towards a
settlement; plaintiffs’ right has prescribed; Eugenio Feliciano was a mere squatter
who should be ordered to vacate; the deed of sale was validly, genuinely and duly
executed; Eugenio and Angelina were guilty of misleading the court because there
were other heirs who were indispensable parties but who were not included; and
Presidential Decree No. 1508 or the Revised Katarungang Pambarangay Law was
not resorted to by plaintiffs.
Page 428 of 507
Cases – Special Civil Actions (Part 1)
Respondents Rosauro Feliciano, Elsa Feliciano and Ponciano Feliciano likewise
filed an Answer15 containing the same allegations and defenses as respondents
Pedro Canoza and Delia Feliciano. The other defendants, Salina Feliciano, Felisa
Feliciano and Nardo Feliciano were declared in default.
On August 3, 1998, the trial court rendered a Decision, the dispositive portion of
which reads as follows:
WHEREFORE, judgment is hereby rendered in favor of the plaintiffs and against
the defendants, as follows:
1. Declaring the extra-judicial settlement of estate of Antonio Feliciano null
and void;
2. Declaring the sale of the property in question to Pedro Canoza, Felisa
Feliciano and Jacinto Feliciano null and void;
3. Declaring the original certificate of Title No. 364 in the name of Pedro
Canoza and the certificates of titles in the name of defendants over Lot
1874-Cad-344, Bustos Cadastre (Tax Declaration No. 1402) as null and
void;
4. Ordering defendants to reconvey ownership and possession of said
property to plaintiffs subject to a just and equitable partition thereof by and
between all interested parties.
No pronouncement as to cost.
SO ORDERED.16
The trial court explained that by operation of law, the plaintiffs (herein petitioners)
have as much right as Leona, Maria, Pedro and Salina Feliciano to inherit the
property in question, and they cannot be deprived of their right unless by
disinheritance for causes set forth in the law. When Leona Feliciano, Pedro
Feliciano, Maria Feliciano and Salina Feliciano appropriated the disputed lot solely
to themselves through the extrajudicial settlement of estate, they committed a
fraudulent act. To the extent that Doroteo and Esteban were deprived of their
rightful share, the said out-of-court settlement was annullable, said the trial court.
The trial court also declared that Pedro Canoza was not a buyer in good faith of
Leona and Maria’s shares. Records show that Pedro Canoza’s live-in partner,
Delia Feliciano, was a relative of the petitioners and the other defendants; thus, he
could be reasonably charged with the knowledge of petitioners’ status vis-à-vis the
subject property. The acquisition by Canoza and Jacinto Feliciano of free patent
titles over portions of the contested lot also did not legitimize their ownership
thereof, as they acquired no greater rights over the property than their
predecessors-in-interest, having merely stepped into their shoes.17
Aggrieved, respondents appealed to the CA with the following assignment of
errors:
I. THE LOWER COURT COMMITTED A REVERSIBLE ERROR IN ADMITTING IN
EVIDENCE THE EXTRA-JUDICIAL SETTLEMENT OF ESTATE OF ANTONIO
FELICIANO (EXHIBIT "B")[;]
II. THE LOWER COURT COMMITTED A REVERSIBLE ERROR IN DECLARING
AS NULL AND VOID THE EXTRA-JUDICIAL SETTLEMENT OF ESTATE OF
ANTONIO FELICIANO (EXHIBIT "B")[;]
III. THE LOWER COURT COMMITTED A REVERSIBLE ERROR IN DECLARING
AS NULL AND VOID THE DEED OF SALE (EXHIBIT "C") IN FAVOR OF
JACINTO FELICIANO, FELISA FELICIANO AND PEDRO CANOZA[;]
IV. THE LOWER COURT COMMITTED A REVERSIBLE ERROR IN DECLARING
O.C.T. NO. 364 IN THE NAME OF PEDRO CANOZA AND CERTIFICATES OF
TITLE OF DEFENDANTS AS NULL AND VOID[; AND]
V. THE LOWER COURT COMMITTED A REVERSIBLE ERROR IN ORDERING
DEFENDANTS TO RECONVEY OWNERSHIP AND POSSESSION OF THE
SUBJECT PROPERTY TO PLAINTIFFS SUBJECT TO A JUST AND EQUITABLE
PARTITION THEREOF BY AND BETWEEN ALL INTERESTED PARTIES.18
On June 26, 2003, the appellate court rendered the assailed Decision reversing
the trial court’s decision. The CA held,
WHEREFORE, premises considered, the appeal is hereby GRANTED.
Accordingly, the Decision dated August 3, 1998 of the Regional Trial Court, Branch
11 (XI), Malolos, Bulacan in Civil Case No. 819-M-93 is hereby REVERSED AND
SET ASIDE and plaintiffs-appellees’ complaint is ordered DISMISSED for being
time-barred.
Page 429 of 507
Cases – Special Civil Actions (Part 1)
SO ORDERED.19
The CA ruled that prescription had set in, citing the case of Pedrosa v. Court of
Appeals,20 which held that the applicable prescriptive period to annul a deed of
extrajudicial settlement is four (4) years from the discovery of the fraud. It
reasoned that when petitioners filed the instant complaint for the annulment of the
extrajudicial settlement of Antonio Feliciano’s estate, more than four (4) years had
elapsed from the issuance of the free patents. As regards the portion claimed by
the late Jacinto Feliciano, sixteen (16) years had elapsed from the time the free
patent was issued to him before petitioners filed the complaint, while in the case of
Canoza, fourteen (14) years had elapsed from the issuance of the free patent in
Canoza’s favor. Hence, according to the CA, the action for the annulment of the
documents had prescribed.
Petitioners filed a motion for reconsideration of the aforesaid Decision but it was
denied by the CA in the Resolution dated January 15, 2004 for lack of merit.
Hence, this petition.
The grounds relied upon by the petitioners are the following:
A. THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR IN
GRANTING THE APPEAL BY ORDERING THE DISMISSAL OF THE
COMPLAINT ON GROUND OF PRESCRIPTION OF ACTION, DESPITE
THE FACT THAT THE ISSUE OF PRESCRIPTION OF ACTION HAS
NOT BEEN RAISED ON APPEAL AS AN ISSUE, NOR ASSIGNED AS
AN ERROR, NOR DEFINED IN THE PRE-TRIAL ORDER AS AMONG
THE ISSUES TO BE RESOLVED;
B. ASSUMING THAT PRESCRIPTION OF ACTION MAY BE TAKEN AS
A GROUND FOR DISMISSING THE COMPLAINT EVEN IF NOT RAISED
ON APPEAL, NOR ASSIGNED AS AMONG THE ERRORS COMMITTED,
THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR IN
HOLDING THAT THE ACTION PRESCRIBES IN FOUR YEARS, OR IN
NOT HOLDING THAT THE ACTION IS IMPRESCRIPTIBLE;
C. THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR IN
NOT AFFIRMING THE DECISION OF THE TRIAL COURT.21
Essentially, the issue for our resolution is whether the CA erred in reversing the
trial court’s decision.
Petitioners allege that the CA gravely erred in granting the appeal and in
dismissing the complaint on the ground of prescription of action because that issue
was never raised on appeal, nor defined as one (1) of the issues outlined and
limited in the pre-trial order.
We do not agree.
While respondents have not assigned the defense of prescription in their appeal
before the CA, they raised such defense in their December 1, 1993 Answer as one
(1) of their affirmative defenses.22 In their brief before the CA, respondents
specifically prayed for the reliefs mentioned in their respective answers before the
trial court. Thus, by reference, they are deemed to have adopted the defense of
prescription, and could not properly be said to have waived the defense of
prescription.
Moreover, Rule 9, Section 1 of the 1997 Rules of Civil Procedure, as amended,
provides that when it appears from the pleadings or the evidence on record that
the action is already barred by the statute of limitations, the court shall dismiss the
claim. Thus, in Gicano v. Gegato,23 we held:
We have ruled that trial courts have authority and discretion to dismiss an action
on the ground of prescription when the parties’ pleadings or other facts on record
show it to be indeed time-barred x x x; and it may do so on the basis of a motion to
dismiss, or an answer which sets up such ground as an affirmative defense; or
even if the ground is alleged after judgment on the merits, as in a motion for
reconsideration; or even if the defense has not been asserted at all, as where no
statement thereof is found in the pleadings, or where a defendant has been
declared in default. What is essential only, to repeat, is that the facts
demonstrating the lapse of the prescriptive period, be otherwise sufficiently and
satisfactorily apparent on the record: either in the averments of the plaintiffs
complaint, or otherwise established by the evidence. (Underscoring supplied.)
But did the CA nonetheless commit error when it held that the applicable
prescriptive period is four (4) years?
Petitioners argue that the CA erroneously treated the action they filed at the trial
court as one (1) for annulment of the extrajudicial settlement and applied the four
Page 430 of 507
Cases – Special Civil Actions (Part 1)
(4)-year prescriptive period in dismissing the same. They contend that the action
they filed was one (1) for Declaration of Nullity of Documents and Titles, Recovery
of Real Property and Damages, and as such, their action was imprescriptible
pursuant to Article 141024 of the Civil Code.
Respondents, for their part, maintain that the CA did not err in holding that the
deed of extrajudicial partition executed without including some of the heirs, who
had no knowledge of the partition and did not consent thereto, is merely fraudulent
and not void. They stress that the action to rescind the partition based on fraud
prescribes in four (4) years counted from the date of registration, which is
constructive notice to the whole world.
We affirm the ruling of the CA. As the records show, the heirs of Doroteo and
Esteban did not participate in the extrajudicial partition executed by Salina with the
other compulsory heirs, Leona, Maria and Pedro. Undeniably, the said deed was
fraudulently obtained as it deprived the known heirs of Doroteo and Esteban of
their shares in the estate. A deed of extrajudicial partition executed without
including some of the heirs, who had no knowledge of and consent to the same, is
fraudulent and vicious.25 Hence, an action to set it aside on the ground of fraud
could be instituted. Such action for the annulment of the said partition, however,
must be brought within four (4) years from the discovery of the fraud.1avvphi1
In Gerona v. De Guzman,26 respondents therein executed a deed of extrajudicial
settlement declaring themselves to be the sole heirs of the late Marcelo de
Guzman. They secured new transfer certificates of title in their own names,
thereby excluding the petitioners therein from the estate of the deceased. The
petitioners brought an action for the annulment of the said deed upon the ground
that the same is tainted with fraud. The Court held,
Inasmuch as petitioners seek to annul the aforementioned deed of "extra-
judicial settlement" upon the ground of fraud in the execution thereof, the
action therefor may be filed within four (4) years from the discovery of the
fraud (Mauricio v. Villanueva, L-11072, September 24, 1959). Such discovery is
deemed to have taken place, in the case at bar, on June 25, 1948, when said
instrument was filed with the Register of Deeds and new certificates of title were
issued in the name of respondents exclusively, for the registration of the deed of
extra-judicial settlement constitute constructive notice to the whole
world.27 (Emphasis and underscoring supplied.)
Evidently, the applicable prescriptive period to institute the action to annul the deed
of extrajudicial settlement was four (4) years counted from the discovery of fraud
as held in the case of Gerona v. De Guzman.28 However, the records show that
petitioners’ complaint was filed only on October 18, 1993, or almost sixteen (16)
years after Jacinto Feliciano was issued Free Patent No. (IV-4) 012293 on
November 28, 1977, and almost fourteen (14) years from the time Pedro Canoza
was issued OCT No. P-364 on November 28, 1979. As petitioners are deemed to
have obtained constructive notice of the fraud upon the registration of the Free
Patent, they clearly failed to institute the present civil action within the allowable
period. The same result obtains even if their complaint is treated as one (1)
essentially for reconveyance as more than ten (10) years have passed since
petitioners’ cause of action accrued. The CA committed no error in dismissing their
complaint.
WHEREFORE, the petition for review on certiorari is DENIED. The Decision dated
June 26, 2003 and Resolution dated January 15, 2004, of the Court of Appeals in
CA-G.R. CV No. 61888 are AFFIRMED.
With costs against petitioners.
SO ORDERED.
G.R. No. 183852 October 20, 2010
CARMELA BROBIO MANGAHAS, Petitioner,
vs.
EUFROCINA A. BROBIO, Respondent.
RESOLUTION
NACHURA, J.:
This petition for review on certiorari seeks to set aside the Court of Appeals (CA)
Decision1 dated February 21, 2008, which dismissed petitioner’s action to enforce
payment of a promissory note issued by respondent, and Resolution 2 dated July 9,
2008, which denied petitioner’s motion for reconsideration.
Page 431 of 507
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The case arose from the following facts:
On January 10, 2002, Pacifico S. Brobio (Pacifico) died intestate, leaving three
parcels of land. He was survived by his wife, respondent Eufrocina A. Brobio, and
four legitimate and three illegitimate children; petitioner Carmela Brobio Mangahas
is one of the illegitimate children.
On May 12, 2002, the heirs of the deceased executed a Deed of Extrajudicial
Settlement of Estate of the Late Pacifico Brobio with Waiver. In the Deed,
petitioner and Pacifico’s other children, in consideration of their love and affection
for respondent and the sum of ₱150,000.00, waived and ceded their respective
shares over the three parcels of land in favor of respondent. According to
petitioner, respondent promised to give her an additional amount for her share in
her father’s estate. Thus, after the signing of the Deed, petitioner demanded from
respondent the promised additional amount, but respondent refused to pay,
claiming that she had no more money.3
A year later, while processing her tax obligations with the Bureau of Internal
Revenue (BIR), respondent was required to submit an original copy of the Deed.
Left with no more original copy of the Deed, respondent summoned petitioner to
her office on May 31, 2003 and asked her to countersign a copy of the Deed.
Petitioner refused to countersign the document, demanding that respondent first
give her the additional amount that she promised. Considering the value of the
three parcels of land (which she claimed to be worth ₱20M), petitioner asked for
₱1M, but respondent begged her to lower the amount. Petitioner agreed to lower it
to ₱600,000.00. Because respondent did not have the money at that time and
petitioner refused to countersign the Deed without any assurance that the amount
would be paid, respondent executed a promissory note. Petitioner agreed to sign
the Deed when respondent signed the promissory note which read —
31 May 2003
This is to promise that I will give a Financial Assistance to CARMELA B.
MANGAHAS the amount of ₱600,000.00 Six Hundred Thousand only on June 15,
2003.
(SGD)
EUFROCINA A. BROBIO4
When the promissory note fell due, respondent failed and refused to pay despite
demand. Petitioner made several more demands upon respondent but the latter
kept on insisting that she had no money.
On January 28, 2004, petitioner filed a Complaint for Specific Performance with
Damages5 against respondent, alleging in part—
2. That plaintiff and defendant are legal heirs of the deceased, Pacifico S.
Brobio[,] who died intestate and leaving without a will, on January 10,
2002, but leaving several real and personal properties (bank deposits),
and some of which were the subject of the extra-judicial settlement among
them, compulsory heirs of the deceased, Pacifico Brobio. x x x.
3. That in consideration of the said waiver of the plaintiff over the listed
properties in the extra-judicial settlement, plaintiff received the sum of
₱150,000.00, and the defendant executed a "Promissory Note" on June
15, 2003, further committing herself to give plaintiff a financial assistance
in the amount of ₱600,000.00. x x x.
4. That on its due date, June 15, 2003, defendant failed to make good of
her promise of delivering to the plaintiff the sum of ₱600,000.00 pursuant
to her "Promissory Note" dated May 31, 2003, and despite repeated
demands, defendant had maliciously and capriciously refused to deliver to
the plaintiff the amount [of] ₱600,000.00, and the last of which demands
was on October 29, 2003. x x x.6
In her Answer with Compulsory Counterclaim,7 respondent admitted that she
signed the promissory note but claimed that she was forced to do so. She also
claimed that the undertaking was not supported by any consideration. More
specifically, she contended that —
10. Defendant was practically held "hostage" by the demand of the
plaintiff. At that time, defendant was so much pressured and was in [a]
hurry to submit the documents to the Bureau of Internal Revenue because
of the deadline set and for fear of possible penalty if not complied with.
Defendant pleaded understanding but plaintiff was adamant. Her hand
could only move in exchange for 1 million pesos.
11. Defendant, out of pressure and confused disposition, was constrained
to make a promissory note in a reduced amount in favor of the plaintiff.
Page 432 of 507
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 The circumstances in the execution of the promissory note were obviously
attended by involuntariness and the same was issued without
consideration at all or for illegal consideration.8
On May 15, 2006, the Regional Trial Court (RTC) rendered a decision in favor of
petitioner. The RTC found that the alleged "pressure and confused disposition"
experienced by respondent and the circumstances that led to the execution of the
promissory note do not constitute undue influence as would vitiate respondent’s
consent thereto. On the contrary, the RTC observed that —
It is clear from all the foregoing that it is the defendant who took improper
advantage of the plaintiff’s trust and confidence in her by resorting to a worthless
written promise, which she was intent on reneging. On the other hand, plaintiff did
not perform an unlawful conduct when she insisted on a written commitment from
the defendant, as embodied in the promissory note in question, before affixing her
signature that was asked of her by the defendant because, as already mentioned,
that was the only opportunity available to her or which suddenly and unexpectedly
presented itself to her in order to press her demand upon the defendant to satisfy
the correct amount of consideration due to her. In other words, as the defendant
had repeatedly rebuffed her plea for additional consideration by claiming lack of
money, it is only natural for the plaintiff to seize the unexpected opportunity that
suddenly presented itself in order to compel the defendant to give to her [what is]
due [her]. And by executing the promissory note which the defendant had no
intention of honoring, as testified to by her, the defendant clearly acted in bad faith
and took advantage of the trust and confidence that plaintiff had reposed in her. 9
The RTC also brushed aside respondent’s claim that the promissory note was not
supported by valuable consideration. The court maintained that the promissory
note was an additional consideration for the waiver of petitioner’s share in the
three properties in favor of respondent. Its conclusion was bolstered by the fact
that the promissory note was executed after negotiation and haggling between the
parties. The dispositive portion of the RTC decision reads:
WHEREFORE, judgment is hereby rendered as follows:
1. Ordering the defendant to pay to plaintiff the sum of Six Hundred
Thousand Pesos (₱600,000.00) which she committed to pay to plaintiff
under the promissory note in question, plus interest thereon at the rate of
12% per annum computed from the date of the filing of the complaint;
2. Ordering the defendant to pay to plaintiff the sum of ₱50,000.00 as
attorney’s fees; and
3. Ordering the defendant to pay to plaintiff the costs of this suit.
SO ORDERED.10
On February 21, 2008, the CA reversed the RTC decision and dismissed the
complaint.11 The CA found that there was a complete absence of consideration in
the execution of the promissory note, which made it inexistent and without any
legal force and effect. The court noted that "financial assistance" was not the real
reason why respondent executed the promissory note, but only to secure
petitioner’s signature. The CA held that the waiver of petitioner’s share in the three
properties, as expressed in the deed of extrajudicial settlement, may not be
considered as the consideration of the promissory note, considering that petitioner
signed the Deed way back in 2002 and she had already received the consideration
of ₱150,000.00 for signing the same. The CA went on to hold that if petitioner
disagreed with the amount she received, then she should have filed an action for
partition.
Further, the CA found that intimidation attended the signing of the promissory note.
Respondent needed the Deed countersigned by petitioner in order to comply with
a BIR requirement; and, with petitioner’s refusal to sign the said document,
respondent was forced to sign the promissory note to assure petitioner that the
money promised to her would be paid.
Petitioner moved for the reconsideration of the CA Decision. In a Resolution dated
July 9, 2008, the CA denied petitioner’s motion.12
In this petition for review, petitioner raises the following issues:
1. The Honorable Court of Appeals erred in the appreciation of the facts of
this case when it found that intimidation attended the execution of the
promissory note subject of this case.
2. The Honorable Court of Appeals erred when it found that the promissory
note was without consideration.
Page 433 of 507
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 3. The Honorable Court of Appeals erred when it stated that petitioner
should have filed [an action] for partition instead of a case for specific
performance.13
The petition is meritorious.
Contracts are voidable where consent thereto is given through mistake, violence,
intimidation, undue influence, or fraud. In determining whether consent is vitiated
by any of these circumstances, courts are given a wide latitude in weighing the
facts or circumstances in a given case and in deciding in favor of what they believe
actually occurred, considering the age, physical infirmity, intelligence, relationship,
and conduct of the parties at the time of the execution of the contract and
subsequent thereto, irrespective of whether the contract is in a public or private
writing.14
Nowhere is it alleged that mistake, violence, fraud, or intimidation attended the
execution of the promissory note. Still, respondent insists that she was "forced"
into signing the promissory note because petitioner would not sign the document
required by the BIR. In one case, the Court – in characterizing a similar argument
by respondents therein – held that such allegation is tantamount to saying that the
other party exerted undue influence upon them. However, the Court said that the
fact that respondents were "forced" to sign the documents does not amount to
vitiated consent.15
There is undue influence when a person takes improper advantage of his power
over the will of another, depriving the latter of a reasonable freedom of
choice.16 For undue influence to be present, the influence exerted must have so
overpowered or subjugated the mind of a contracting party as to destroy his free
agency, making him express the will of another rather than his own.17
Respondent may have desperately needed petitioner’s signature on the Deed, but
there is no showing that she was deprived of free agency when she signed the
promissory note. Being forced into a situation does not amount to vitiated consent
where it is not shown that the party is deprived of free will and choice. Respondent
still had a choice: she could have refused to execute the promissory note and
resorted to judicial means to obtain petitioner’s signature. Instead, respondent
chose to execute the promissory note to obtain petitioner’s signature, thereby
agreeing to pay the amount demanded by petitioner.
The fact that respondent may have felt compelled, under the circumstances, to
execute the promissory note will not negate the voluntariness of the act. As rightly
observed by the trial court, the execution of the promissory note in the amount of
₱600,000.00 was, in fact, the product of a negotiation between the parties.
Respondent herself testified that she bargained with petitioner to lower the
amount:
ATTY. VILLEGAS:
Q And is it not that there was even a bargaining from ₱1-M to ₱600,000.00
before you prepare[d] and [sign[ed] that promissory note marked as
Exhibit "C"?
A Yes, sir.
Q And in fact, you were the one [who] personally wrote the amount of
₱600,000.00 only as indicated in the said promissory note?
A Yes, sir.
COURT:
Q So, just to clarify. Carmela was asking an additional amount of ₱1-M for
her to sign this document but you negotiated with her and asked that it be
lowered to ₱600,000.00 to which she agreed, is that correct?
A Yes, Your Honor. Napilitan na po ako.
Q But you negotiated and asked for its reduction from ₱1-M to
₱600,000.00?
A Yes, Your Honor.18
Contrary to the CA’s findings, the situation did not amount to intimidation that
vitiated consent.1awphil There is intimidation when one of the contracting parties is
compelled to give his consent by a reasonable and well-grounded fear of an
imminent and grave evil upon his person or property, or upon the person or
property of his spouse, descendants, or ascendants.19 Certainly, the payment of
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penalties for delayed payment of taxes would not qualify as a "reasonable and
well-grounded fear of an imminent and grave evil."
We join the RTC in holding that courts will not set aside contracts merely because
solicitation, importunity, argument, persuasion, or appeal to affection was used to
obtain the consent of the other party. Influence obtained by persuasion or
argument or by appeal to affection is not prohibited either in law or morals and is
not obnoxious even in courts of equity.20
On the issue that the promissory note is void for not being supported by a
consideration, we likewise disagree with the CA.
A contract is presumed to be supported by cause or consideration.21The
presumption that a contract has sufficient consideration cannot be overthrown by a
mere assertion that it has no consideration. To overcome the presumption, the
alleged lack of consideration must be shown by preponderance of evidence. 22 The
burden to prove lack of consideration rests upon whoever alleges it, which, in the
present case, is respondent.
Respondent failed to prove that the promissory note was not supported by any
consideration. From her testimony and her assertions in the pleadings, it is clear
that the promissory note was issued for a cause or consideration, which, at the
very least, was petitioner’s signature on the document.1avvphi1
It may very well be argued that if such was the consideration, it was inadequate.
Nonetheless, even if the consideration is inadequate, the contract would not be
invalidated, unless there has been fraud, mistake, or undue influence.23 As
previously stated, none of these grounds had been proven present in this case.
The foregoing discussion renders the final issue insignificant. Be that as it may, we
would like to state that the remedy suggested by the CA is not the proper one
under the circumstances. An action for partition implies that the property is still
owned in common.24 Considering that the heirs had already executed a deed of
extrajudicial settlement and waived their shares in favor of respondent, the
properties are no longer under a state of co-ownership; there is nothing more to be
partitioned, as ownership had already been merged in one person.
WHEREFORE, premises considered, the CA Decision dated February 21, 2008
and its Resolution dated July 9, 2008 are REVERSED and SET ASIDE. The RTC
decision dated May 15, 2006 is REINSTATED.
SO ORDERED.
FORCIBLE ENTRY AND UNLAWFUL DETAINER
March 12, 2014
G.R. No. 187944
VARMENCITA SUAREZ, Petitioner,
vs.
MR. and MRS. FELIX E. EMBOY, JR. and MARILOU P. EMBOY-
DELANTAR, Respondents.
DECISION
REYES, J.:
For review in the instant Petition1 is the Decision2 rendered on March 19, 2009 and
Resolution3 issued on May 5, 2009 by the Court of Appeals (CA) in CA-G.R. SP
No. 03489. The CA granted the Petition for Review4 filed by Mr. and Mrs. Felix
Emboy, Jr. (Felix) and Marilou Emboy-Delantar (Marilou) (respondents), seeking to
reverse the decisions of the Regional Trial Court (RTC), Branch 12, 5 and Municipal
Trial Court in Cities (MTCC), Branch 3,6 of Cebu City, rendered on February 26,
2008 in Civil Case No. CEB-33328,7 and on September 25, 2006 in Civil Case No.
R-49832, respectively. The RTC affirmed the MTCC in upholding the claims of
Carmencita Suarez (Carmencita) in her complaint for unlawful detainer instituted
against the respondents.
Antecedents
At the center of the dispute is a 222-square meter parcel of land, designated as Lot
No. 1907-A-2 (subject lot) of the subdivision plan Psd-165686, situated in
Barangay Duljo, Cebu City, and covered by Transfer Certificate of Title (TCT) No.
T-174880 issued in the name of Carmencita on February 9, 2005. The subject lot
used to be a part of Lot No. 1907-A,8 which was partitioned in the following manner
among the heirs of Spouses Carlos Padilla (Carlos) and Asuncion Pacres
(Asuncion):9
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Lot No. TCT No. Heirs
1907-A-1 T-543459 Spouses Rogelio and Praxedes Padilla
1907-A-2 T-543460 Heirs of Vicente Padilla (Vicente), namely: (1) Azucena Padilla,
married to Felly Carrera; (2) Remedios Padilla (Remedios),
married to Oscar Dimay; (3) Veronica Padilla (Veronica);10 and (4)2006. The respondents were ordered to vacate the subject lot and remove at their
Moreno Padilla (Moreno), married to Teresita Curso (Teresita)
1907-A-3 T-543461 Cresencio Padilla
1907-A-4 T-543462 Fructousa Baricuatro
1907-A-5 T-543463 Claudia Padilla-Emboy (Claudia)
A house, which is occupied by respondents Felix and Marilou, stands in the
subject lot. The respondents claim that their mother, Claudia, had occupied the
subject lot during her lifetime and it was earmarked to become her share in Lot No.
1907-A. They had thereafter stayed in the subject lot for decades after inheriting
the same from Claudia, who had in turn succeeded her own parents, Carlos and
Asuncion.11
In 2004, respondents Felix and Marilou were asked by their cousins, who are the
Heirs of Vicente, to vacate the subject lot and to transfer to Lot No. 1907-A-5, a
landlocked portion sans a right of way. They refused to comply insisting that
Claudia’s inheritance pertained to Lot No. 1907-A-2. 12
Not long after, the respondents received from Carmencita’s counsel, Atty.
Jufelenito R. Pareja (Atty. Pareja), a demand letter, dated February 23, 2004,
requiring them to vacate the subject lot. They were informed that Carmencita had
already purchased on February 12, 2004 the subject lot from the former’s relatives.
However, the respondents did not heed the demand. Instead, they examined the
records pertaining to the subject lot and uncovered possible anomalies, i.e., forged
signatures and alterations, in the execution of a series of deeds of partition relative
to Lot No. 1907-A. On August 13, 2004, they filed before the RTC of Cebu City a
complaint13 for nullification of the partition and for the issuance of new TCTs
covering the heirs’ respective portions of Lot No. 1907-A.14
On December 8, 2004, Carmencita filed before the MTCC and against the
respondents a complaint for unlawful detainer, the origin of the instant
petition.1âwphi1 She alleged that she bought the subject lot from Remedios,
Moreno, Veronica and Dionesia,15 the registered owners thereof and the persons
who allowed the respondents to occupy the same by mere tolerance. As their
successor-in-interest, she claimed her entitlement to possession of the subject lot
and the right to demand from the respondents to vacate the same.16
The MTCC upheld Carmencita’s claims in its decision rendered on September 25,
expense all the improvements they had built thereon. They were likewise made
solidarily liable to pay Carmencita Php 20,000.00 as attorney’s fees.17
In the Decision dated February 26, 2008, the RTC affirmed in its entirety the
MTCC ruling.18
The respondents challenged the MTCC and RTC judgments through a Petition for
Review19 filed before the CA.
The respondents argued that they have been occupying the subject lot in the
concept of owners for several decades. Carmencita, on the other hand, was a
buyer in bad faith for having purchased the property despite the notice of lis
pendens clearly annotated on the subject lot’s title. Even her complaint for unlawful
detainer was filed on December 8, 2004 subsequent to the respondents’ institution
on August 13, 2004 of a petition for nullification of the partition. Citing Sarmiento v.
CA,20 the respondents emphasized that "even if one is the owner of the property,
the possession thereof cannot be wrested from another who had been in the
physical or material possession of the same for more than one year by resorting to
a summary action of ejectment."21 The respondents also invoked the doctrine
enunciated in Amagan v. Marayag22 that the pendency of another action anchored
on the issue of ownership justifies the suspension of an ejectment suit involving
the same real property. The foregoing is especially true in the case at bar where
the issue of possession is so interwoven with that of ownership. Besides, the
resolution of the question of ownership would necessarily result in the disposition
of the issue of possession.
The respondents also stressed that the deed of sale dated April 1, 2004, which
was attached to the complaint for unlawful detainer, bore tell-tale signs of being
spurious. First, Atty. Pareja’s demand letter sent to the respondents instead
referred to a deed of sale dated February 12, 2004. Secondly, Teresita, who now
lives in Luzon and has been estranged from Moreno since the 1980s, was a
signatory in the deed of sale. Thirdly, a certain Veronida Padilla, a fictitious person,
also signed the deed of sale as among the vendors, but she, too, was impleaded
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as a co-defendant in the ejectment suit. Fourthly, the deed was only registered the
following year after its supposed execution.
The respondents insisted that the Heirs of Vicente, who had allegedly sold the
subject lot to Carmencita, had never physically occupied the same. Hence, there
was no basis at all for Carmencita’s claim that the respondents’ possession of the
subject lot was by mere tolerance of the alleged owners.
The respondents also presented before the CA a newly discovered evidence,
which they found in an old wooden chest in their ancestral home. A duly notarized
document captioned as an "Agreement,"23 dated February 23, 1957, showed that
Vicente and his spouse, Dionesia, had waived their hereditary rights to Lot No.
1907-A. The document stated that Vicente obtained a loan from the Philippine
National Bank using Lot No. 1907-A as a collateral. The loan was paid by Carlos
and Asuncion and the waiver must have been executed in order to be fair to
Vicente’s siblings. Prescinding from the above, the Heirs of Vicente no longer had
ownership rights over the subject lot to convey to Carmencita.
The respondents also averred that Carmencita’s complaint lacked a cause of
action. The certification to file an action was issued by the officials of Barangay
Duljo in the name of James Tan Suarez, Carmencita’s brother, who had no real
rights or interests over the subject lot. Further, while Carmencita based her claim
over the subject lot by virtue of a deed of sale executed on April 1, 2004, no
demand to vacate was made upon the respondents after that date. The absence of
such demand rendered the complaint fatally defective, as the date of its service
should be the reckoning point of the one-year period within which the suit can be
filed.
In support of the respondents’ prayer for the issuance of injunctive reliefs, they
argued that their loss would be irreparable. Moreover, the resolution of the
respondents’ petition for nullification of the partition of Lot No. 1907-A, in which
Carmencita was likewise impleaded as a defendant, would be rendered useless in
the event that the latter’s complaint for unlawful detainer would be granted and the
former’s ancestral house demolished.
The Ruling of the CA
On March 19, 2009, the CA rendered the herein assailed Decision reversing the
disquisitions of the courts a quo and dismissing Carmencita’s complaint for
unlawful detainer. The CA explained:
Section 1, Rule 70 of the Rules of Court provides:
Section 1. Who may institute proceedings, and when.—Subject to the provisions of
the next succeeding section, a person deprived of the possession of any land or
building by force, intimidation, threat, strategy, or stealth, or a lessor, vendor,
vendee, or other person against whom the possession of any land or building is
unlawfully withheld after the expiration or termination of the right to hold
possession, by virtue of any contract, express or implied, or the legal
representatives or assigns of any such lessor, vendor, vendee, or other person,
may, at any time within one (1) year after such unlawful deprivation or withholding
of possession, bring an action in the proper Municipal Trial Court against the
person or persons unlawfully withholding or depriving of possession, or any person
or persons claiming under them, for the restitution of such possession, together
with damages and costs.
The distinction between forcible entry and unlawful detainer was lucidly explained
in Sarmiento vs. Court of Appeals,:
Forcible entry and unlawful detainer cases are two distinct actions defined in
Section 1, Rule 70 of the Rules of Court. [In] forcible entry, one is deprived of
physical possession of land or building by means of force, intimidation, threat,
strategy, or stealth. In unlawful detainer, one unlawfully withholds possession
thereof after the expiration or termination of his right to hold possession under any
contract, express or implied. In forcible entry, the possession is illegal from the
beginning and the basic inquiry centers on who has the prior possession de facto.
In unlawful detainer, the possession was originally lawful but became unlawful by
the expiration or termination of the right to possess, hence the issue of rightful
possession is decisive for, in such action, the defendant is in actual possession
and the plaintiffs cause of action is the termination of the defendant’s right to
continue in possession.
What determines the cause of action is the nature of defendant’s entry into the
land. If the entry is illegal, then the action which may be filed against the intruder
within one (1) year therefrom is forcible entry. If, on the other hand, the entry is
legal but the possession thereafter became illegal, the case is one of unlawful
detainer which must be filed within one (1) year from the date of the last demand.
A close perusal of [Carmencita’s] complaint a quo reveals that the action was
neither one of forcible entry nor unlawful detainer but essentially involved an issue
of ownership which must be resolved in an accion reivindicatoria. It did not
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characterize [the respondents’] alleged entry into the land: whether the same was
legal or illegal. It did not state how [the respondents] entered the land and
constructed a house thereon. It was also silent on whether [the respondents’]
possession became legal before [Carmencita] demanded from them to vacate the
land. The complaint merely averred that their relatives previously owned the lot
[the respondents] were occupying and that after [Carmencita] purchased it[,] she,
as its new owner, demanded [for the respondents] to vacate the land. Moreover, it
is undisputed that [the respondents] and their ancestors have been occupying the
land for several decades already. There was no averment as to how or when
[Carmencita’s] predecessors tolerated [the respondents’] possession of the land.
Consequently, there was no contract to speak of, whether express or implied,
between [the respondents], on one hand, and [Carmencita] or her predecessors,
on the other, as would qualify [the respondents’] possession of the land as a case
of unlawful detainer. Neither was it alleged that [the respondents] took possession
of the land through force, intimidation, threat, strategy or stealth to make out a
case of forcible entry. In any event, [Carmencita] cannot legally assert that [the
respondents’] possession of the land was by mere tolerance. This is because
[Carmencita’s] predecessors-in-interest did not yet own the property when
[Claudia] took possession thereof. Take note that [Carmencita’s] predecessors-in-
interest merely stepped into the shoes of their parents who were also co-heirs of
[Claudia]. Finally, to categorize a cause of action as one constitutive of unlawful
detainer, plaintiff’s supposed acts of tolerance must have been present from the
start of the possession which he later seek[s] to recover. This is clearly wanting in
the case at bar.
Indeed, when the complaint fails to aver facts constitutive of forcible entry or
unlawful detainer, as where it does not state how entry was effected or how and
when dispossession started, as in the case at bar, the remedy should either be an
accion publiciana or an accion reivindicatoria in the proper RTC. If [Carmencita] is
truly the owner of the subject property and she was unlawfully deprived of the real
right of possession or ownership thereof, she should present her claim before the
RTC in an accion publiciana or an accion reivindicatoria, and not before the
municipal trial court in a summary proceeding of unlawful detainer or forcible entry.
Munoz vs. Court of Appeals enunciated:
For even if he is the owner, possession of the property cannot be wrested from
another who had been in possession thereof for more than twelve (12) years
through a summary action for ejectment. Although admittedly[,] petitioner may
validly claim ownership based on the muniments of title it presented, such
evidence does not responsibly address the issue of prior actual possession raised
in a forcible entry case. It must be stated that regardless of actual condition of the
title to the property, the party in peaceable quiet possession shall not be turned out
by a strong hand, violence or terror. Thus, a party who can prove prior possession
can recover such possession even against the owner himself. Whatever may be
the character of his prior possession, if he has in his favor priority in time, he has
the security that entitles him to remain on the property until he is lawfully ejected
by a person having a better right by accion publiciana or accion
reivindicatoria.24 (Citations omitted and underscoring supplied)
In Carmencita’s Motion for Reconsideration25 filed before the CA, she alleged that
the case of Sarmiento cited by the respondents is not applicable to the present
controversy since it involves a boundary dispute, which is properly the subject of
an accion reivindicatoria and over which the MTCC has no jurisdiction. She
claimed that Rivera v. Rivera26 finds more relevance in the case at bar. In Rivera,
the contending parties were each other’s relatives and the Court ruled that in an
unlawful detainer case, prior physical possession by the complainant is not
necessary.27Instead, what is required is a better right of possession. Further, the
MTCC cannot be divested of jurisdiction just because the defendants assert
ownership over the disputed property.
In the herein assailed Resolution dated May 5, 2009, the CA denied Carmencita’s
Motion for Reconsideration.
In essence, the instant petition presents the following issues:
I
Whether or not Carmencita’s complaint against the respondents had sufficiently
alleged and proven a cause of action for unlawful detainer.
II
Whether or not the pendency of the respondents’ petition for nullification of
partition of Lot No. 1907-A and for the issuance of new certificates of title can
abate Carmencita’s ejectment suit.
Carmencita’s Allegations
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In support of the petition, Carmencita reiterates that she purchased the subject lot
from the Heirs of Vicente, who were then the registered owners thereof. At the time
of the sale, respondents Felix and Marilou were occupying the subject lot. Thus,
Atty. Pareja, in Carmencita’s behalf, demanded that they vacate the property. The
respondents’ refusal to comply with the demand turned them into deforciants
unlawfully withholding the possession of the subject lot from Carmencita, the new
owner, whose recourse was to file a complaint for unlawful detainer.
Further, Carmencita insists that a certificate of title shall not be subject to a
collateral attack28 and the issue of ownership cannot be resolved in an action for
unlawful detainer. A pending suit involving the question of ownership of a piece of
real property will not abate an ejectment complaint as the two are not based on the
same cause of action and are seeking different reliefs.29
Additionally, Carmencita invokes the doctrine in Eastern Shipping Lines, Inc. v.
CA30 that the registered owner of a property is entitled to its possession. In Arcal v.
CA,31 the Court also explained that the occupation of a property not by its
registered owner but by others depends on the former’s tolerance, and the
occupants are bound by an implied promise to vacate upon demand, failing at
which, a suit for ejectment would be proper.32
The Respondents’Arguments
In their Comment33 to the instant petition, the respondents stress that Carmencita’s
complaint for unlawful detainer was fundamentally inadequate. There was
practically no specific averment as to when and how possession by tolerance of
the respondents began. In the complaint, Carmencita made a general claim that
the respondents possessed "the property by mere tolerance ‘with the
understanding that they would voluntarily vacate the premises and remove their
house(s) thereon upon demand by the owners’."34 In Spouses Valdez, Jr. v.
CA,35 the Court ruled that the failure of the complainants to allege key jurisdictional
facts constitutive of unlawful detainer is fatal and deprives the MTCC of jurisdiction
over the action.
In their rejoinder,36 the respondents likewise argue that the issues of possession
and ownership are inseparably linked in the case at bar. Carmencita’s complaint
for ejectment was based solely on her spurious title, which is already the subject of
the respondents’ petition for nullification of partition of Lot No. 1907-A.
Our Disquisition
The instant petition lacks merit.
Carmencita had not amply alleged and proven that all the requisites for unlawful
detainer are present in the case at bar.
"Without a doubt, the registered owner of real property is entitled to its possession.
However, the owner cannot simply wrest possession thereof from whoever is in
actual occupation of the property. To recover possession, he must resort to the
proper judicial remedy and, once he chooses what action to file, he is required to
satisfy the conditions necessary for such action to prosper."37
In Spouses Valdez, Jr.,38 the Court is instructive anent the three kinds of actions
available to recover possession of real property, viz:
(a) accion interdictal; (b) accion publiciana; and (c) accion reivindicatoria.
Accion interdictal comprises two distinct causes of action, namely, forcible entry
(detentacion) and unlawful detainer (desahuico) [sic]. In forcible entry, one is
deprived of physical possession of real property by means of force, intimidation,
strategy, threats, or stealth whereas in unlawful detainer, one illegally withholds
possession after the expiration or termination of his right to hold possession under
any contract, express or implied. The two are distinguished from each other in that
in forcible entry, the possession of the defendant is illegal from the beginning, and
that the issue is which party has prior de facto possession while in unlawful
detainer, possession of the defendant is originally legal but became illegal due to
the expiration or termination of the right to possess.
The jurisdiction of these two actions, which are summary in nature, lies in the
proper municipal trial court or metropolitan trial court. Both actions must be brought
within one year from the date of actual entry on the land, in case of forcible entry,
and from the date of last demand, in case of unlawful detainer. The issue in said
cases is the right to physical possession.
Accion publiciana is the plenary action to recover the right of possession which
should be brought in the proper regional trial court when dispossession has lasted
for more than one year. It is an ordinary civil proceeding to determine the better
right of possession of realty independently of title. In other words, if at the time of
the filing of the complaint more than one year had elapsed since defendant had
turned plaintiff out of possession or defendant’s possession had become illegal,
the action will be, not one of the forcible entry or illegal detainer, but an accion
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publiciana. On the other hand, accion reivindicatoria is an action to recover
ownership also brought in the proper regional trial court in an ordinary civil
proceeding.39 (Citations omitted)
In a complaint for unlawful detainer, the following key jurisdictional facts must be
alleged and sufficiently established:
(1)initially, possession of property by the defendant was by contract with or
by tolerance of the plaintiff;
(2)eventually, such possession became illegal upon notice by plaintiff to
defendant of the termination of the latter’s right of possession;
(3)thereafter, the defendant remained in possession of the property and
deprived the plaintiff of the enjoyment thereof; and
(4)within one year from the last demand on defendant to vacate the
property, the plaintiff instituted the complaint for ejectment.40
In the case at bar, the first requisite mentioned above is markedly absent.
Carmencita failed to clearly allege and prove how and when the respondents
entered the subject lot and constructed a house upon it.41 Carmencita was likewise
conspicuously silent about the details on who specifically permitted the
respondents to occupy the lot, and how and when such tolerance came
about.42 Instead, Carmencita cavalierly formulated a legal conclusion, sans factual
substantiation, that (a) the respondents’ initial occupation of the subject lot was
lawful by virtue of tolerance by the registered owners, and (b) the respondents
became deforciants unlawfully withholding the subject lot’s possession after
Carmencita, as purchaser and new registered owner, had demanded for the
former to vacate the property.43 It is worth noting that the absence of the first
requisite assumes even more importance in the light of the respondents’ claim that
for decades, they have been occupying the subject lot as owners thereof.
Again, this Court stresses that to give the court jurisdiction to effect the ejectment
of an occupant or deforciant on the land, it is necessary that the complaint must
sufficiently show such a statement of facts as to bring the party clearly within the
class of cases for which the statutes provide a remedy, without resort to parol
testimony, as these proceedings are summary in nature. In short, the jurisdictional
facts must appear on the face of the complaint. When the complaint fails to aver
facts constitutive of forcible entry or unlawful detainer, as where it does not state
how entry was effected or how and when dispossession started, the remedy
should either be an accion publiciana or accion reivindicatoria.44
As an exception to the general rule, the respondents’ petition for nullification of the
partition of Lot No. 1907-A can abate Carmencita’s suit for unlawful detainer.
In Amagan, the Court is emphatic that:
As a general rule, therefore, a pending civil action involving ownership of the same
property does not justify the suspension of ejectment proceedings. "The underlying
reasons for the above ruling were that the actions in the Regional Trial Court did
not involve physical or de facto possession, and, on not a few occasions, that the
case in the Regional Trial Court was merely a ploy to delay disposition of the
ejectment proceeding, or that the issues presented in the former could quite as
easily be set up as defenses in the ejectment action and there resolved."
Only in rare instances is suspension allowed to await the outcome of the pending
civil action. One such exception is Vda. de Legaspi v. Avendaño, wherein the
Court declared:
"x x x. Where the action, therefore, is one of illegal detainer, as distinguished from
one of forcible entry, and the right of the plaintiff to recover the premises is
seriously placed in issue in a proper judicial proceeding, it is more equitable and
just and less productive of confusion and disturbance of physical possession, with
all its concomitant inconvenience and expenses. For the Court in which the issue
of legal possession, whether involving ownership or not, is brought to restrain,
should a petition for preliminary injunction be filed with it, the effects of any order or
decision in the unlawful detainer case in order to await the final judgment in the
more substantive case involving legal possession or ownership. It is only where
there has been forcible entry that as a matter of public policy the right to physical
possession should be immediately set at rest in favor of the prior possession
regardless of the fact that the other party might ultimately be found to have
superior claim to the premises involved, thereby to discourage any attempt to
recover possession thru force, strategy or stealth and without resorting to the
courts."
xxxx
Indisputably, the execution of the MCTC Decision would have resulted in the
demolition of the house subject of the ejectment suit; thus, by parity of reasoning,
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considerations of equity require the suspension of the ejectment proceedings. We
note that, like Vda. de Legaspi, the respondent’s suit is one of unlawful detainer
and not of forcible entry. And most certainly, the ejectment of petitioners would
mean a demolition of their house, a matter that is likely to create the "confusion,
disturbance, inconveniences and expenses" mentioned in the said exceptional
case.
Necessarily, the affirmance of the MCTC Decision would cause the respondent to
go through the whole gamut of enforcing it by physically removing the petitioners
from the premises they claim to have been occupying since 1937. (Respondent is
claiming ownership only of the land, not of the house.) Needlessly, the litigants as
well as the courts will be wasting much time and effort by proceeding at a stage
wherein the outcome is at best temporary, but the result of enforcement is
permanent, unjust and probably irreparable.
We should stress that respondent’s claim to physical possession is based not on
an expired or a violated contract of lease, but allegedly on "mere tolerance."
Without in any way prejudging the proceedings for the quieting of title, we deem it
judicious under the present exceptional circumstances to suspend the ejectment
case.45 (Citations omitted)
The Court then quoted with favor the following portion of the Decision dated July 8,
1997, penned by Associate Justice Artemio G. Tuquero in CA-G.R. No. 43611-SP,
from which the Amagan case sprang:
"ONE. Private respondent Teodorico T. Marayag anchors his action for unlawful
detainer on the theory that petitioners’ possession of the property in question was
by mere tolerance. However, in answer to his demand letter dated April 13, 1996 x
x x, petitioners categorically denied having any agreement with him, verbal or
written, asserting that they are ‘owners of the premises we are occupying at 108
J.P. Rizal Street, San Vicente, Silang, Cavite.’ In other words, it is not merely
physical possession but ownership as well that is involved in this case.["]
"TWO. In fact, to protect their rights to the premises in question, petitioners filed an
action for reconveyance, quieting of title and damages against private
respondents, docketed as Civil Case No. TG-1682 of the Regional Trial Court,
Branch 18, Tagaytay City. The issue of ownership is squarely raised in this action.
Undoubtedly, the resolution of this issue will be determinative of who is entitled to
the possession of the premises in question.["]
"THREE. The immediate execution of the judgment in the unlawful detainer case
will include the removal of the petitioners’ house [from] the lot in question.["]
"To the mind of the Court it is injudicious, nay inequitable, to allow demolition of
petitioners’ house prior to the determination of the question of ownership [of] the lot
on which it stands."46 (Citation omitted)
We find the doctrines enunciated in Amagan squarely applicable to the instant
petition for reasons discussed hereunder.
Carmencita’s complaint for unlawful detainer is anchored upon the proposition that
the respondents have been in possession of the subject lot by mere tolerance of
the owners. The respondents, on the other hand, raise the defense of ownership of
the subject lot and point to the pendency of Civil Case No. CEB-30548, a petition
for nullification of the partition of Lot No. 1907-A, in which Carmencita and the
Heirs of Vicente were impleaded as parties. Further, should Carmencita’s
complaint be granted, the respondents’ house, which has been standing in the
subject lot for decades, would be subject to demolition. The foregoing
circumstances, thus, justify the exclusion of the instant petition from the purview of
the general rule.
All told, we find no reversible error committed by the CA in dismissing
Carmencita's complaint for unlawful detainer. As discussed above, the
jurisdictional requirement of possession by mere tolerance of the owners had not
been amply alleged and proven. Moreover, circumstances exist which justify the
abatement of the ejectment proceedings. Carmencita can ventilate her ownership
claims in an action more suited for the purpose. The respondents, on other hand,
need not be exposed to the risk of having their house demolished pending the
resolution of their petition for nullification of the partition of Lot No. 1907-A, where
ownership over the subject lot is likewise presented as an issue.
IN VIEW OF THE FOREGOING, the instant petition is DENIED.
The Decision rendered on March 19, 2009 and Resolution issued on May 5, 2009
by the Court of Appeals in CA-G.R. SP No. 03489 are AFFIRMED.
SO ORDERED.
Page 441 of 507
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G.R. No. 189248 February 5, 2014
TEODORO S. TEODORO (Deceased), Substituted by his heirs/sons NELSON
TEODORO and ROLANDO TEODORO, Petitioners,
vs.
DANILO ESPINO, ROSARIO SANTIAGO, JULIANA CASTILLO, PAULINA
LITAO, RAQUEL RODRIGUEZ, RUFINA DELA CRUZ, and LEONILA
CRUZ, Respondents.
DECISION
PEREZ, J.:
We here have what appears to be a cut and dried case for ejectment which has,
nonetheless, resulted in three conflicting and varying decisions of the lower courts.
We exercise judicial restraint: we simply delineate the possessory rights of the
warring parties and refrain from ruling on these squabbling heirs' respective claims
of ownership.
This petition for review on certiorari under Rule 45 of the Rules of Court assails the
Decision1 of the Court of Appeals in CA-G.R. SP No. 99805 which reversed and
set aside the Decision2 of the Regional Trial Court (RTC) Branch 81, Malolos,
Bulacan in Civil Case No. 634-M-06 which, in turn, vacated and set aside the
Decision3 of the Municipal Trial Court (MTC), Bulacan, Bulacan in Civil Case No.
1240. The case is for Forcible Entry filed by the predecessor-in-interest of
petitioners Nelson and Rolando Teodoro, heirs of Teodoro S. Teodoro (Teodoro
Teodoro), against respondents Danilo Espino, Rosario Santiago, Juliana Castillo,
Paulina Litao, Raquel Rodriguez, Rufina dela Cruz and Leonila Cruz, a squabble
for physical possession of a portion of a real property, the ownership of which is
traceable to Genaro Teodoro (Genaro).
The subject property is a portion within Cadastral Lot No. 2476 with a total area of
248 square meters, covered by Tax Declaration No. 99-05003-0246, registered in
the name of Genaro, long deceased ascendant of all the parties. The subject
property pertains to the vacant lot where the old ancestral house of Genaro stood
until its demolition in June 2004, at the instance of Teodoro Teodoro.
Genaro had five children: Santiago; Maria, from whom respondents descended
and trace their claim of ownership and right of possession; Petra, Mariano,
Teodoro Teodoro’s father; and Ana. Genaro and his children are all deceased.
Respondents’ respective parents are first cousins of Teodoro Teodoro. All parties
are collateral relatives of Petra Teodoro: Teodoro Teodoro is her nephew while
respondents are her grandnephews and grandnieces, descendants of Petra’s
sister, Maria Teodoro.
Of all Genaro’s children, only Petra occupied the subject property, living at the
ancestral house. Genaro’s other children, specifically Santiago, Maria and Mariano
were bequeathed, and stayed at, a different property within the same locality, still
from the estate of their father.
After Petra’s death, her purported will, a holographic will, was probated in Special
Proceedings No. 1615-M before RTC, Branch 8, Malolos, Bulacan, which Decision
on the will’s extrinsic validity has become final and executory. 4 In the will, Petra,
asserting ownership, devised the subject property to Teodoro Teodoro.
Teodoro Teodoro effected the demolition of the ancestral house, intending to use
the subject property for other purposes.
Soon thereafter, respondents, who resided at portions of Lot No. 2476 that
surround the subject property on which the ancestral house previously stood,
erected a fence on the surrounding portion, barricaded its frontage, and put up a
sign thereat, effectively dispossessing Teodoro Teodoro of the property
bequeathed to him by Petra.
After Teodoro Teodoro’s demand for respondents to vacate the subject property
went unheeded, he filed the complaint for forcible entry against respondents,
alleging the following in pertinent part:
3. [Teodoro Teodoro] is a nephew of the deceased Petra Teodoro vda. De
Salonga x x x who executed a holographic will designating him therein as
administrator of her estate and likewise devised in his favor a parcel of land
located in Purok 2, Bambang, Bulacan, Bulacan and the ancestral house built
therein. Other properties of Petra Teodoro were bequeathed in favor of other
named heirs. x x x.
4. Aforementioned parcel of land with the ancestral house was in turn inherited by
the decedent Petra Teodoro from her father Genaro Teodoro who also gave
separate properties to his four other children, who are all dead, namely, Santiago
who has eight (8) children, Maria who has six (6) children, Ana who has no child
Page 442 of 507
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and Mariano who has eight (8) children including herein [Teodoro Teodoro] as the
eldest;
5. It is of common knowledge in the locality that the subject property where the
ancestral house stood was given by Genaro Teodoro to [his] daughter Petra
Teodoro to the exclusion of all others. Petra Teodoro lived in that property all her
life. x x x.
xxxx
7. This subject property is declared for taxation purposes in the name of [Teodoro
Teodoro’s] grandfather, Genaro Teodoro as shown by the hereto attached
photocopy of Tax Declaration of Real Property No. 99-05003-0246 for the year
2000 which is marked as Annex "F";
xxxx
10. [Subject property] having been given to [Teodoro Teodoro] as a devisee in the
approved will of Petra Teodoro, it became his absolute property to the exclusion of
all others;
11. Sometime in July 2004, [Teodoro Teodoro] as the absolute owner and
possessor thereof, decided to demolish the already dilapidated ancestral house in
the subject property to clear the same for other available uses/purposes. x x x.
12. By means of force and intimidation, [Teodoro Teodoro] was ousted likewise
prevented by [respondents] from entering the subject property. [Respondents]
have also onverted/appropriated for themselves the exclusive use of the subject
property into their own parking lot and other personal use, to the exclusion and
damage of [Teodoro Teodoro];5 (Emphasis supplied).
In their Answer, respondents asserted their own ownership and possession of the
subject property, countering that:
5. It is worth to mention that [respondents] Danilo Espino and Rosario Santiago are
residing thereat for more than fifty (50) years, while [respondents] Paulina Litao
and Rufina dela Cruz are resident of the subject place for more than sixty (60)
years, most of them residing thereat since birth, at the time that their grandmother
Maria Teodoro is still living and residing thereat.
6. Thus, when siblings Maria Teodoro (grandmother of [respondents]), Petra (to
whom the subject property was inherited) and Mariano (father of [Teodoro
Teodoro]) died, the heirs, who include [respondents] and [Teodoro Teodoro]
extrajudicially, among themselves, partitioned the property left by their ascendants,
which are still in the name of the siblings’ father Genaro Teodoro. [Respondents],
since they are already residing in the subject property and had built their
respective houses therein, had with them the said subject [property]. x x x.
7. [Respondents], through their authorized representative, [respondent] Rosario
Santiago, in the exercise of their act of ownership of the subject lot paid for its real
property taxes. x x x.
8. x x x [Teodoro Teodoro] deliberately failed to consider and mention in his
complaint that there was already a decision rendered by court, declaring the
subject property as part of the property left by Petra Teodoro to her legitimate
heirs, which include among others [respondents].
9. That however, due to [respondents’] failure as substituted heirs to execute the
order, dated May 18, 1994, a Motion for the Revival of Judgment was filed and
heard before Branch 10 of the Regional Trial Court of Bulacan. The Honorable
Court x x x resolved x x x the extent of the allowance and admission to probate the
holographic will of the late Petra Teodoro, where a Certificate of Allowance dated
February 14, 1990 was subsequently issued, as its Decision dated June 29, 1989
became final and executory, affect the revival of judgment.
xxxx
13. While it is true that the dilapidated ancestral house in the subject property was
demolished; however, the said act, as suggested by [Teodoro Teodoro] was
allowed by [respondents] (who had their respective houses built in the same lot
where the same is constructed) in order to have the same be partitioned among
themselves. As [Teodoro Teodoro] was constantly complaining that the property
left to him and his siblings is less than the subject property given to the
[respondents] in area, they agreed verbally that if the ancestral house will be
demolished, a surveyor would be at ease in surveying the same and determine if
indeed the area is more than that allotted to [Teodoro Teodoro], which in that case,
as per agreement, the excess, if any will suffice the lack in area of [Teodoro
Teodoro]. It was however found out that the area of the subject property was less
than the area that should be allocated and apportioned as shares of [respondents],
Page 443 of 507
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hence they [intimated] the same to [Teodoro Teodoro], who got mad and
threaten[ed] to get the subject property from them.
14. The putting of signs "No Trespassing" posted at the frontage of the subject
property is an allowable act by owners, residing thereat to protect their property
against intruders, hence there is nothing wrong for [respondents] to put the same.
x x x.
15. There is no truth, as what [Teodoro Teodoro] claimed in paragraph 12 of his
complaint that he was ousted and prevented from entering the subject property by
[respondents], because in the first place he could not be ousted thereat, as he is
not in possession of the said property.6 (Emphasis theirs).
After trial, the MTC dismissed the complaint, ruling on the issue of ownership and
ultimately resolving the issue of who between Teodoro Teodoro and respondents
had a better right to possess the subject property:
x x x [Teodoro Teodoro’s] claim of ownership over the subject lot stemmed from
the approved and duly probated Holographic Will of Petra Teodoro. Although it its
undisputed that Petra Teodoro was in actual possession of the subject lot prior to
her demise and that she left a Holographic Will wherein the subject lot was
bequeathed to [Teodoro Teodoro], the probate of her last will has not finally settled
the question of ownership over the subject lot. Clearly, the subject lot still forms
part of the estate of the late Genaro Teodoro. In the absence of an actual and
approved partition plan among his heirs, the subject lot remains part of the Genaro
Teodoro’s estate. Since his children Santiago, Maria, Petra, Maraino and Ana are
all deceased, their children or grandchildren by right of representation have the
right to inherit from their ancestor.
xxxx
A person who claims that he has a better right to real property must prove his
ownership of the same x x x. Clearly, [Teodoro Teodoro] has failed to prove his
ownership over the property or that of his devisee Petra Teodoro. Thus, the court
is convinced that the possession of [respondents] over the subject lot should not
be disturbed, until and unless the question of ownership over the same shall have
been finally resolved before the appropriate court.
xxxx
WHEREFORE, judgment is hereby rendered dismissing the complaint and the
counterclaim interposed in relation thereto, without pronouncement as to costs.7
The RTC, in its appellate jurisdiction over forcible entry cases, acting on Teodoro
Teodoro’s appeal, adopted the factual findings of the MTC, but reversed the ruling,
ruled in favor of Teodoro Teodoro and ordered the ejectment of respondents from
the subject property. It pithily ruled, thus:
But the bottom line for resolution in this case is who has the prior physical
possession of the subject parcel. x x x.
The late Petra Teodoro’s share to the inheritance of his father Genaro is admittedly
the old ancestral house and the lot over which it stands. x x x.
[Teodoro Teodoro] claims right to possession only over said portion (now the
vacant space x x x not the entire lot 2476 until he was displaced therefrom by the
[respondents] through force). [Teodoro Teodoro] does not contest the perimeter
area of Lot 2476 where [respondents] are residing. He has acknowledged in clear
terms that the rest of the area of Lot 2476 is occupied by [respondents]. The
assailed decision recognized that Petra Teodoro was in actual possession of the
lot prior to her death. It is [Teodoro Teodoro’s] argument that Petra Teodoro,
tacked [from by Teodoro Teodoro], has had prior physical possession of the
controverted portion of lot 2476. He went on arguing that regardless of whether or
not the duly probated will completely settled the issue of partition of the remaining
estate of Genaro Teodoro, he has the prior actual and physical possession of the
vacant space where the old ancestral house formerly stands, passed on to him by
the late Petra Teodoro, a fact [respondents] deny. [Respondents] even belied that
they have ousted and restrained [Teodoro Teodoro] from entering the subject
property.
Said pretension is however negated by evidence showing the barricaded vacant
space or disputed area consisting of 120 square meters, more or less
(approximate width of lot is 7.55 meters, approximate length is 17.9 meters with
indented portion measuring 1.5 meters deep x x x), where the cemented portion of
the flooring of the bakery near the national road lease by [respondents] is still
existing x x x and over which he exercised control and constructive possession. x x
x.
xxxx
Page 444 of 507
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[Teodoro Teodoro] anchors on the other hand his claim on the Holographic Will of
Petra Teodoro dated May 1, 1973 x x x duly probated and approved in a Decision
x x x dated June 19, 1989 of Branch 8 of this Court in SP Proceeding No. 1615-M,
which Decision has become final and executory as of February 14, 1990 x x x
bequeathing the disputed portion of Lot 2476 and the old ancestral house thereon
to him, the letters of administration issued to him by Branch 8 of this Court x x x,
the Project of Partition submitted to the said court x x x plus his possession of the
vacant area or disputed portion of [L]ot 2476. [Respondents] has stressed that he
is not contesting the rest of [L]ot 2476 occupied by the houses of [respondents].
Analyzing the facts of the case, the lower [court] concluded that the subject parcel
is a part of the estate of the late Genaro Teodoro and in the absence of an
approved partition among the heirs, remains a community property over which the
legal heirs of Genaro Teodoro have the right to inherit. All therefore are entitled to
exercise the right of dominion including the right of possession.
This Court disagrees with the said ruling applying the plethora of cases decisive of
the issue and consistent with the established jurisprudence that the lower court
cannot dispose with finality the issue of ownership-such issue being inutile in an
ejectment suit except to throw light on the question of possession.
Given the foregoing, [Teodoro Teodoro] has established a valid claim to institute
the eviction suit against [respondents] over the disputed area or vacant portion of
Lot 2476 and for him to be restored therein.
xxxx
WHEREFORE, premises considered, finding reversible error on the appealed
judgment, the same is hereby VACATED and SET ASIDE and a new one is
entered as follows:
1. Ordering that [Teodoro Teodoro] be restored in the lawful possession of
the disputed area of Lot 2476 and for the eviction therefore of
[respondents] on said portion; and
2. [Respondents] to pay the costs of the suit.8
With the reversal of the MTC’s ruling, respondents then appealed the RTC’s
decision to the Court of Appeals. The appellate court reversed the RTC, likewise
dismissed the complaint as the MTC had done, but did not reach the same result
as that of the inferior court. It specifically ruled that Teodoro Teodoro:
(1) never had physical possession of the subject property, not having lived
there at anytime, whether while Petra was alive nor after her death;
(2) did not adduce evidence before the lower courts on proof of payment of
any real property tax on the disputed vacant lot, portion of Lot No. 2476, or
to the whole of Lot No. 2476;
(3) did not solely or unilaterally cause the demolition of the ancestral
house such a fact equating to his exclusive ownership of the subject
property and complete control and dominion over it; and
(4) cannot tack his alleged possession of the subject property to that of
Petra Teodoro simply by virtue of the latter’s holographic will, leading to
the issue of ownership which is insignificant in forcible entry cases.
In all, the appellate court found that Teodoro Teodoro (substituted by his heirs
Nelson and Rolando Teodoro at that juncture) "failed to discharge the burden of
proof that he had prior actual physical possession of the subject [property] before it
was barricaded by [respondents] to warrant the institution of the forcible entry suit."
The appellate court disposed of the case, thus:
WHEREFORE, premises considered, the assailed Decision [dated] 28 February
2007 and Resolution dated 26 June 2007 of the Regional Trial Court of Malolos,
Bulacan, Branch 81 are hereby REVERSED and SET ASIDE, and the instant case
is DISMISSED for lack of merit.9
Hence, this appeal by certiorari filed by the heirs of Teodoro Teodoro raising the
following errors in the appellate court’s dismissal of the complaint:
1. The Honorable Court of Appeals failed to take notice of relevant facts
such as petitioner Teodoro’s exercise of possessory rights over the subject
property, among others, which if properly considered, will justify a different
conclusion.
2. The Honorable Court of Appeals misappreciated undisputed facts such
as the respondents’ fencing of the vacant area cleared by petitioner
Page 445 of 507
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 Teodoro and their barricading of the frontage thereof, among others, that
deprived petitioner Teodoro his possessory rights over the vacant area.
3. The findings of the Honorable Court of Appeals are grounded entirely on
speculation, surmises or conjectures.
4. There is grave abuse of discretion in the appreciation of facts in the
assailed Decision.10
The assigned errors define the issue for our resolution which is whether or not the
act of respondents in barricading the frontage of the portion of Lot No. 2476 on
which stood the ancestral house occupied by Petra amounted to Teodoro
Teodoro’s unlawful dispossession thereof through the forcible entry of
respondents.
The ground rules in forcible entry cases:11
(1) One employs force, intimidation, threat, strategy or stealth to deprive
another of physical possession of real property.
(2) Plaintiff (Teodoro Teodoro) must allege and prove prior physical
possession of the property in litigation until deprived thereof by the
defendant (herein respondents). This requirement implies that the
possession of the disputed land by the latter was unlawful from the
beginning.
(3) The sole question for resolution hinges on the physical or material
possession (possession de facto) of the property. Neither a claim of
juridical possession (possession de jure) nor an averment of ownership by
the defendant can, at the outset, preclude the court from taking
cognizance of the case.
(4) Ejectment cases proceed independently of any claim of ownership, and
the plaintiff needs merely to prove prior possession de facto and undue
deprivation thereof. In this case, both parties assert prior and exclusive
physical possession in the concept of owner12 acquired through
succession13 from the same decedent, their aunt and grand aunt,
respectively, Petra. In turn, Petra inherited the property from her father
Genaro, in whose name the subject property is still registered.
Teodoro Teodoro’s assertion of physical possession comprises mainly of his
claimed ownership of the subject property acquired through testate succession, or
via the holographic will of Petra.14 Teodoro Teodoro then points, as an exercise of
his ownership and incident of his physical possession of the subject property, to
his act of demolition of the ancestral house.
On the other hand, respondents assert possession likewise by virtue of ownership
manifested in their residence at Lot No. 2476 spanning more than five (5) decades,
reckoned even from the time Maria, respondents’ grandmother and sister of Petra,
was alive and resided thereat.15
Respondents trace their possession from the extrajudicial partition of the
commingled properties of the siblings Maria, respondents’ direct ascendant, Petra
and Mariano, father of Teodoro Teodoro, progeny and heirs of
Genaro.16 According to respondents, from the partition, the heirs of all three
Genaro children possessed and occupied their respective shares: respondents
received Lot No. 2476 which encompasses herein subject property, while Teodoro
Teodoro and his siblings received a different property, "a 667 residential lot at
Bambang, Bulacan, Bulacan."
Also, respondents aver that, through respondent Rosario Santiago, they paid for
Lot No. 2476’s realty taxes. Respondents counter that the subject property was not
solely bequeathed to Teodoro Teodoro as it is part of Petra’s estate for disposition
to her legitimate heirs, including herein respondents. Lastly, on Teodoro Teodoro’s
claim that he had solely effected the demolition of the ancestral house,
respondents contend that they had allowed the demolition upon the understanding
that the parties would then completely partition the subject property, as that portion
is centrally located in Lot No. 2476 where the respondents actually reside.
Given both parties respective claims of ownership over the subject property via
succession from their ascendants Maria, Petra and Mariano Teodoro, who are all
compulsory heirs of Genaro in whose name the subject property is still registered,
the MTC ruled that respondents cannot be disturbed in their possession of the
subject property "until and unless the question of ownership over the same [is]
finally resolved before the appropriate court."
In contrast, the RTC, without categorically resolving the issue of ownership of Lot
No. 2476, ruled that on the portion of Lot No. 2476 where the ancestral house
used to stand, Teodoro did establish his prior physical possession over the subject
property resulting in his right to institute the ejectment suit against respondents.
Page 446 of 507
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Significantly, the RTC confirmed respondents’ physical possession of, and
residency at, Lot No. 2476.
There would yet be another turn of events. The appellate court, albeit refusing to
touch and rule on the issue of ownership, declared that there lacked conclusive
evidence of Teodoro Teodoro’s prior actual physical possession over the subject
property. Thus, the appellate court dismissed
Teodoro Teodoro’s complaint for lack of merit.
We are now asked for a final ruling.
We grant the petition. We reverse the decision of the Court of Appeals and restore
the decision of the RTC on the appeal reversing the MTC.
We affirm the finding of fact by the RTC which is decisive of the issue that has
remained unresolved inspite of a summary procedure and two appellate reviews of
the forcible entry case filed by Teodoro Teodoro. The RTC said:
Analyzing the facts of the case, the lower [court] concluded that the subject parcel
is a part of the estate of the late Genaro Teodoro and in the absence of an
approved partition among the heirs, remains a community property over which the
legal heirs of Genaro Teodoro have the right to inherit. All therefore are entitled to
exercise the right of dominion including the right of possession.17 (Emphasis
supplied).
The RTC’s comment that it "disagrees with the said ruling" only meant that "the
lower court cannot dispose with finality the issue of ownership" since such
ownership issue is "inutile in an ejectment suit except to throw light on the question
of possession."18 And so the RTC ruled that Teodoro Teodoro should be restored
in the lawful possession of the disputed area of Lot No. 2476 in light of the finding
of the MTC that the subject lot still forms part of the estate of the late Genaro
Teodoro. It is from this same fact that the MTC reached the contrary conclusion
that Teodoro Teodoro’s complaint should be dismissed because he has "failed to
prove his ownership."19
In the sense that Teodoro Teodoro has not proven exclusive ownership, the MTC
was right.1âwphi1 But exclusive ownership of Lot No. 2476 or a portion thereof is
not in this case required of Teodoro Teodoro for him to be entitled to possession.
Co-ownership, the finding of both the MTC at first instance and by the RTC on
appeal, is sufficient. The pertinent provisions of the Civil Code state:
Art. 484. There is co-ownership whenever the ownership of an undivided thing or
right belongs to different persons.
Art. 1078. When there are two or more heirs, the whole estate of the decedent is,
before its partition, owned in common by such heirs, subject to the payment of
debts of the deceased.
Certainly, and as found by the trial courts, the whole of Lot No. 2476 including the
portion now litigated is, owing to the fact that it has remained registered in the
name of Genaro who is the common ancestor of both parties herein, co-owned
property. All, or both Teodoro Teodoro and respondents are entitled to exercise
the right of possession as co-owners.
Neither party can exclude the other from possession. Although the property
remains unpartitioned, the respondents in fact possess specific areas. Teodoro
Teodoro can likewise point to a specific area, which is that which was possessed
by Petra. Teodoro Teodoro cannot be dispossessed of such area, not only by
virtue of Petra's bequeathal in his favor but also because of his own right of
possession that comes from his co-ownership of the property. As the RTC
concluded, petitioners, as heirs substituting Teodoro
Teodoro in this suit, should be restored in the lawful possession of the disputed
area.
WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals in
CA-G.R. SP No. 99805 is REVERSED and SET ASIDE and the Decision of the
Regional Trial Court in Civil Case No. 634-M-06 is REINSTATED. No
pronouncement as to costs.
SO ORDERED.
A.M. No. MTJ-05-1580 October 6, 2010
[Formerly OCA IPI No. 04-1608-MTJ]
Page 447 of 507
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LOURDES B. FERRER and PROSPERIDAD M. ARANDEZ, Complainants,
vs.
JUDGE ROMEO A. RABACA, Metropolitan Trial Court, Branch 25,
Manila, Respondent.
DECISION
BERSAMIN, J.:
This administrative case charges Hon. Romeo A. Rabaca, then the Presiding
Judge of Branch 25 of the Metropolitan Trial Court of Manila (MeTC), with
ignorance of the law, disregard of the law, dereliction of duty, knowingly rendering
an unjust interlocutory order, and violation of the Code of Conduct for Government
Officials.
The complainants were the President and the Executive Director of the plaintiff in
Civil Case No. 176394-CV of the MeTC, an ejectment suit entitled Young Women’s
Christian Association, Inc. v. Conrado Cano. After trial, Civil Case No. 176394-CV
was decided on June 22, 2004 by respondent Judge,1 who disposed as follows:
WHEREFORE, premises considered, judgment is hereby rendered in favor of the
plaintiff and against the defendant ordering the latter as follows:
(a) to vacate the premises located at Ground Floor, YMCA, 1144 Gen.
Luna St., Ermita, Manila; and surrender possession thereof to plaintiff;
(b) to pay plaintiff the sum of Php45,211.80 representing his arrears in
rentals from February 2003 to July 2003 at Php7,535.30 a month plus the
further sum of Php7,535.30 a month as reasonable value for the continued
use and occupation of the premises starting August 2003 until the same is
finally vacated and possession thereof is turn-over to plaintiff;
(c) to pay the plaintiff the sum of Php20,000 as attorney’s fees; and
(d) to pay the costs of suit.
SO ORDERED.
On July 12, 2004, the plaintiff’s counsel filed a motion for immediate execution,
praying that a writ of execution be issued "for the immediate execution of the
aforesaid Judgment." The plaintiff cited Section 19, Rule 70 of the Rules of Court
as basis for its motion.2
In his order dated July 14, 2004, however, respondent Judge denied the motion for
immediate execution,3 stating:
A Notice of Appeal dated July 9, 2004, having been seasonably filed by counsel for
the defendant, let the records of the above-captioned case be, as it is hereby
ordered, elevated to the Regional Trial Court of Manila for appropriate proceedings
and disposition.
In view thereof, no more action shall be taken on the Motion for Execution dated
July 8, 2004 filed by the plaintiff thru counsel.
SO ORDERED.
According to the complainants, their counsel talked with respondent Judge about
the matter. Allegedly, respondent Judge told their counsel that "if you think the
court is wrong, file a motion for reconsideration." With that, the plaintiff filed a
motion for reconsideration, which respondent Judge nonetheless denied in his
order dated July 28, 2004,4thuswise:
Considering that the Court has already given due course to the appeal of the
defendant which was perfected within the reglementary period, no more action will
be taken on the Motion for Reconsideration dated July 19, 2004 filed by the plaintiff
thru counsel.
The Branch Clerk of Court is hereby directed to immediately forward the records of
this case to the Regional Trial Court, Manila.
SO ORDERED.
The complainants averred that respondent Judge’s denial of their motions had
rendered their victory inutile, and had unfairly deprived the plaintiff of the
possession of the premises. They further averred that respondent Judge’s refusal
to perform an act mandated by the Rules of Court had given undue advantage to
the defendant to the plaintiff’s damage and prejudice.
Page 448 of 507
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The Court required respondent Judge to comment on the administrative complaint
against him.
In his comment dated September 16, 2004,5 respondent Judge denied the
charges. He explained that he had honestly thought that his court had lost
jurisdiction over the case pursuant to the provision of Section 9, Rule 41 of the
Rules of Court (which provides that "in appeals by notice of appeal, the court loses
jurisdiction over the case upon the perfection of the appeals filed in due time and
the expiration of the time to appeal of the other parties") once he had given due
course to the defendant’s notice of appeal. He claimed that he had issued the
orders in good faith and with no malice after a fair and impartial evaluation of the
facts, applicable rules, and jurisprudence; and that if he had thereby committed
lapses in the issuance of the orders, his doing so should be considered as error of
judgment on his part.
He lastly insisted that he did not know personally the parties in Civil Case No.
176394-CV, and had absolutely no reason to give undue favor or advantage to the
defendant; that the complainants did not submit evidence to show that the orders
had been issued for a consideration, material or otherwise, or that his issuance of
the orders had been motivated by ill-will or bad faith.
In their reply dated September 22, 2004,6 the complainants contended that
respondent Judge exhibited his ignorance of the law and procedure in relying on
Section 9, Rule 41 of the Rules of Court which referred to appeals from the
Regional Trial Court; that Rule 40, which contained provisions on appeal from the
Municipal Trial Courts to the Regional Trial Courts, and which provided in its
Section 4 that the perfection of the appeal and the effect of such perfection should
be governed by the provisions of Section 9 of Rule 41, concerned appeals by
notice of appeal in general; and that instead, the applicable rule should be Section
19, Rule 70 of the Rules of Court.
The complainants pointed out that respondent Judge apparently did not know that
appeal in forcible entry and detainer cases was not perfected by the mere filing of
a notice of appeal (as in ordinary actions) but by filing of a notice of appeal and a
sufficient supersedeas bond approved by the trial judge executed to the plaintiff to
pay the rents, damages and costs accruing down to the time of the judgment
appealed from. They asserted that respondent Judge’s invocation of good faith
and error of judgment did not absolve him of liability, because he had grossly
neglected his duties mandated by law by failing and refusing to act on their motion
for immediate execution and motion for reconsideration and by giving due course
to the appeal despite no supersedeas bond having been filed and approved by the
trial court.
In his memorandum dated January 13, 2005,7 then Court Administrator Presbitero
J. Velasco, Jr., now Associate Justice of the Court, recommended that the
administrative complaint against respondent Judge be re-docketed as a regular
administrative matter; and that respondent Judge be fined in the amount of
₱5,000.00 with warning that a repetition of the same or similar act would be dealt
with more severely, based on an evaluation of the charges, as follows:
EVALUATION: We agree with the complainants that respondent erred when he did
not act on complainants’ motion for immediate execution.
Section 19, Rule 70 of the 1997 Revised Rules on Civil Procedure provides:
"SEC. 19. If judgment is rendered against the defendant, execution shall issue
immediately upon motion, unless an appeal has been perfected and the defendant
to stay execution files a supersedeas bond, approved by the Municipal Trial Court
and executed in favor of the plaintiff to pay the rents, damages, and costs accruing
down to the time of the judgment appealed from, and unless, during the pendency
of the appeal, he deposits with the appellate court the amount of rent due from
time to time under the contract, if any, as determined by the judgment of the
Municipal Trial Court. XXXX XXXX XXXX."
It is clear from the foregoing that the perfection of an appeal by itself is not
sufficient to stay the execution of the judgment in an ejectment case. The losing
party should likewise file a supersedeas bond executed in favor of the plaintiff to
answer for rents, damages and costs, and, if the judgment of the court requires it,
he should likewise deposit the amount of the rent before the appellate court from
the time during the pendency of the appeal. Otherwise, execution becomes
ministerial and imperative. (Philippine Holding Corporation vs. Valenzuela, 104
SCRA 401 as cited in Hualam Construction and Development Corporation vs.
Court of Appeals, 214 SCRA 612, 626).
In the case at bar, defendant seasonably filed his Notice of Appeal dated 9 July
2004 on 13 July 2004; he however failed to file any supersedeas bond. Prior to the
filing of such notice of appeal, more specifically on 12 July 2004, complainants
have already filed their Motion for Execution dated 8 July 2004. Instead of acting
on the Motion for Execution, respondent Judge Rabaca gave due course to the
appeal in an Order dated 14 July 2004 and directed his Branch Clerk of Court to
Page 449 of 507
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elevate the records of the case to the Regional Trial Court (RTC). The Branch
Clerk of Court however failed to forward the records to the RTC. This fact is clear
from Judge Rabaca’s Order dated 28 July 2004 wherein he directed the Branch
Clerk of Court to forward the records of the case to the Manila Regional Trial Court
immediately.
From the foregoing, it is clear that when the complainant moved for the immediate
execution of Judge Rabaca’s decision, the latter still had jurisdiction over the case.
He therefore clearly erred when he refused to act on the Motion for Execution. The
relevant question that we should resolve however is whether such error is an error
of judgment or an error amounting to incompetence that calls for administrative
discipline.
Judge Rabaca claims that he refused to act on the complainant’s Motion for
execution because he honestly thought that when he gave due course to the
defendant’s appeal which was seasonably filed, and ordered the elevation of the
records to the appellate court, his court already lost jurisdiction over the case.. In
making his ruling, respondent asserts he relied on the provisions of Section 9, Rule
41 of the Rules of Court. This provision reads as follows:
In appeals by notice of appeal, the court loses jurisdiction over the case upon the
perfection of the appeals filed in due time and the expiration of the time to appeal
of the other parties.
He likewise allegedly relied on the ruling of the Court in Administrative Matter OCA
IPI No. 03-1513-MTJ: Susana Joaquin Vda. De Agregado vs. Judge Thelma
Bunyi-Medina, MeTJ wherein the Court said that-
Respondent Judge is correct in saying that she had lost jurisdiction to entertain the
motion for execution after the perfection of the appeal and after she issued an
order to transmit the records of the case to the appellate court for review.
The facts of the case against Judge Bunyi-Medina are however different from
those prevailing in the instant case. In the Medina case, the fifteen (15) day period
within which to perfect the appeal had already lapsed before the complainant
therein moved for the execution of the execution judgment. Clearly therefore,
appeal had already been perfected. In the instant case, although the defendant
had filed his appeal, the period to appeal had not yet lapsed since the plaintiff still
had his own period to appeal from the judgment and such period had not yet
lapsed. The provision relied upon by judge Rabaca, more specifically, Section 9,
Rule 41 of the Rules of Court, clearly states that, "In appeals by notice of appeal,
the court loses jurisdiction over the case upon perfection of the appeals filed on
due time and the expiration of the time to appeal of the other parties." Moreover
and more importantly, the herein complainants filed their Motion for Execution
even before the defendant had filed his Notice of Appeal. Such motion was
therefore still well within the jurisdiction of the lower court.
It is basic rule in ejectment cases that the execution of judgment in favor of the
plaintiff is a matter of right and mandatory. This has been the consistent ruling of
the Court in a number of cases involving the same issue posed before the
respondent judge. Respondent Judge is expected to know this and his justification
of erroneous application of the law, although mitigating, could not exculpate him
from liability.
We agree with and adopt the evaluation of the Court Administrator.
Indeed, respondent Judge should have granted the plaintiff’s motion for immediate
execution considering that the defendant did not file the sufficient supersedeas
bond despite having appealed. Granting the plaintiff’s motion for immediate
execution became his ministerial duty upon the defendant’s failure to file the
sufficient supersedeas bond. Section 19, Rule 70, of the Rules of Court clearly
imposes such duty, viz:
Section 19. Immediate execution of judgment; how to stay same. — If judgment is
rendered against the defendant, execution shall issue immediately upon motion,
unless an appeal has been perfected and the defendant to stay execution files a
sufficient supersedeas bond, approved by the Municipal Trial Court and executed
in favor of the plaintiff to pay the rents, damages, and costs accruing down to the
time of the judgment appealed from, and unless, during the pendency of the
appeal, he deposits with the appellate court the amount of rent due from time to
time under the contract, if any, as determined by the judgment of the Municipal
Trial Court. In the absence of a contract, he shall deposit with the Regional Trial
Court the reasonable value of the use and occupation of the premises for the
preceding month or period at the rate determined by the judgment of the lower
court on or before the tenth day of each succeeding month or period. The
supersedeas bond shall be transmitted by the Municipal Trial Court, with the other
papers, to the clerk of the Regional Trial Court to which the action is appealed.
xxx
Page 450 of 507
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Respondent Judge’s excuse, that he had lost jurisdiction over the case by virtue of The recommended penalty of ₱5,000.00 with warning that a repetition of the same
the defendant’s appeal, was unacceptable in light of the clear and explicit text of or similar act would be dealt with more severely is also correct. The Court
the aforequoted rule. To begin with, the perfection of the appeal by the defendant Administrator rationalized the recommendation of the penalty thuswise:
did not forbid the favorable action on the plaintiff’s motion for immediate execution.
The execution of the decision could not be stayed by the mere taking of the Under A.M. No. 01-8-10-SC, ‘Gross Ignorance of the Law or Procedure’ is
appeal. Only the filing of the sufficient supersedeas bond and the deposit with the classified as serious offense for which the imposable penalty ranges from a fine to
appellate court of the amount of rent due from time to time, coupled with the dismissal. However, we find respondent’s acts not ingrained with malice or bad
perfection of the appeal, could stay the execution. Secondly, he could not also faith. It is a matter of public policy that in the absence of fraud, dishonesty or
credibly justify his omission to act according to the provision by claiming good faith corrupt motive, the acts of a judge in his judicial capacity are not subject to
or honest belief, or by asserting lack of malice or bad faith.1avvphil A rule as clear disciplinary action even though such acts are erroneous. In Domingo vs. Judge
and explicit as Section 19 could not be misread or misapplied, but should be Pagayatan, A.M. No. RTJ-03-1751, 10 June 2003, the penalty of fine in the
implemented without evasion or hesitation. To us, good faith, or honest belief, or amount of five thousand pesos was deemed sufficient where it was held that
lack of malice, or lack of bad faith justifies a non-compliance only when there is an respondent’s lack of malice or bad faith frees him from administrative liability but
as-yet unsettled doubt on the meaning or applicability of a rule or legal provision. It not for gross ignorance of the law.
was not so herein. And, thirdly, given that his court, being vested with original
exclusive jurisdiction over cases similar to Civil Case No. 176394-CV, had been
We concur with the rationalization of the Court Administrator. Verily, even if
assigned many such cases, he was not a trial judge bereft of the pertinent prior
respondent Judge’s omission would have easily amounted to gross
experience to act on the issue of immediate execution, a fact that further exposed
the abject inanity of his excuses.
ignorance of the law and procedure, a serious offense under Section 8,8 Rule 140,
of the Rules of Court, as amended, the fact that the complainants did not establish
We agree with the complainants’ insistence, therefore, that respondent Judge’s
that malice or bad faith impelled his omission to act, or that fraud, dishonesty, or a
omission to apply Section 19 was inexcusable. He had ignored the urging to follow
corrupt motive attended his omission to act demands a downgrading of the liability.
the clear and explicit provision of the rule made in the plaintiff’s motion for
In the absence of any showing that he had been held guilty of any other
immediate execution. Had he any genuine doubt about his authority to grant the
administrative offense,9 and without our attention being called to other
motion for immediate execution, as he would have us believe, he could have easily circumstances that might demonstrate respondent Judge’s dark motives for his
and correctly resolved the doubt by a resort to the Rules of Court, which he well
inaction, we should find and consider the recommended penalty of ₱5,000.00 with
knew was the repository of the guidelines he was seeking for his judicial action.
warning that a repetition of the same or similar act would be dealt with more
Neither was it relevant that he did not know any of the parties, or that he did not
severely to be commensurate to the offense.10
corruptly favor the defendant by his omission. His mere failure to perform a duty
enjoined by the Rules of Court sufficed to render him administratively accountable.
WHEREFORE, we find respondent JUDGE ROMEO A. RABACA, Presiding
Judge of Branch 25, Metropolitan Trial Court, in Manila guilty of ignorance of the
This case is an opportune occasion to remind judges of the first level courts to
law and procedure, and, accordingly, impose upon him a fine of ₱5,000.00 with
adhere always to the mandate under Section 19, Rule 70, of the Rules of Court to
warning that a repetition of the same or similar act would be dealt with more
issue writs of execution upon motion of the plaintiffs in actions for forcible entry or
severely.
unlawful detainer when the defendant has appealed but has not filed a sufficient
supersedeas bond. The summary nature of the special civil action under Rule 70
and the purpose underlying the mandate for an immediate execution, which is to SO ORDERED.
prevent the plaintiffs from being further deprived of their rightful possession, should
always be borne in mind.

[G.R. NO. 170916 : April 27, 2007]

Page 451 of 507
Cases – Special Civil Actions (Part 1)
CGR CORPORATION herein represented by its President ALBERTO RAMOS,
III, HERMAN M. BENEDICTO and ALBERTO R.
BENEDICTO, Petitioners, v. ERNESTO L. TREYES, JR., Respondent
DECISION
CARPIO MORALES, J.:
Assailed via Petition for Review are issuances of the Regional Trial Court (RTC),
Branch 43, Bacolod City, in Civil Case No. 04-12284, to wit: Order1 dated August
26, 2005 which dismissed petitioners' complaint for damages on the ground of
prematurity, and Order2 dated January 2, 2006 which denied petitioners' motion for
reconsideration.
In issue is one of law - whether a complainant in a forcible entry case can file an
independent action for damages arising after the act of dispossession had
occurred.
CGR Corporation, Herman M. Benedicto and Alberto R. Benedicto (petitioners)
claimed to have occupied 37.3033 hectares of public land in Barangay Bulanon,
Sagay City, Negros Occidental even before the notarized separate Fishpond
Lease Agreement Nos. 5674,3 56944 and 56955 in their respective favor were
approved in October 2000 by the Secretary of Agriculture for a period of twenty-
five (25) years or until December 31, 2024.
On November 18, 2000, Ernesto L. Treyes, Jr. (respondent) allegedly forcibly and
unlawfully entered the leased properties and once inside barricaded the entrance
to the fishponds, set up a barbed wire fence along the road going to petitioners'
fishponds, and harvested several tons of milkfish, fry and fingerlingsowned by
petitioners.
On November 22, 2000, petitioners promptly filed with the Municipal Trial Court
(MTC) in Sagay City separate complaints for Forcible Entry With Temporary
Restraining Order And/Or Preliminary Injunction And Damages, docketed as Civil
Case Nos. 1331,6 13327 and 1333,8 against Ernesto M. Treyes, Sr. and
respondent.
In a separate move, petitioners filed in March 2004 with the Bacolod RTC
a complaint for damages against respondent, docketed as Civil Case No, 04-
12284, alleging, inter alia,
x x x
V
That prior to the issuance of the fishpond lease agreement in favor of the plaintiffs,
they had already been in open and continuous possession of the same parcel of
land;
VI
As lessee and in possession of the above[-]described fishpond, plaintiffs have
continuously occupied, cultivated and developed the said fishpond and since then,
had been regularly harvesting milkfish, shrimps, mud crabs and other produce of
the fishponds;ςηαñrοblεš νιr†υαl lαω lιbrαrÿ
VII
That the yearly income of the fishpond of the plaintiff corporation is at
least P300,000.00more or less, while the yearly income of the fishpond of plaintiff
Herman Benedicto, Sr. is at least P100,000.00 more or less, and the yearly income
of the fishpond of plaintiff Alberto Benedicto is at least P100,000.00 more or less;
VIII
That sometime last November 18, 2000 or thereabout, defendant Ernesto L.
Treyes, Jr. and his armed men and with the help of the blue guards from the
Negros Veterans Security Agency forcibly and unlawfully entered the fishponds of
the plaintiffs and once inside barricaded the entrance of the fishpond and set up
barb wire fence along the road going to plaintiffs fishpond and harvested the
milkfish and carted away several tons of milkfish owned by the plaintiffs;
IX
That on succeeding days, defendant's men continued their forage on the fishponds
of the plaintiffs by carting and taking away the remaining full grown milkfish, fry and
fingerlings and other marine products in the fishponds. NOT ONLY THAT, even
the chapel built by plaintiff CGR Corporation was ransacked and destroyed and the
materials taken away by defendant's men. Religious icons were also stolen and as
an extreme act of sacrilege, even decapitated the heads of some of these icons;
Page 452 of 507
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 x x x The only issue is whether, during the pendency of their separate complaints for
XIII
That the unlawful, forcible and illegal intrusion/destruction of defendant Ernesto
Treyes, Jr. and his men on the fishpond leased and possessed by the plaintiffs is
without any authority of law and in violation of Article 539 of the New Civil Code
which states:
"Art. 539. Every possessor has a right to be respected in his possession; and
should he be disturbed therein he shall be protected in or restored to said
possession by the means established by the laws and rules of the
Court."9 (Underscoring supplied) and praying for the following reliefs:
1) Ordering the defendant to pay plaintiff CGR Corporation the sum of at
least P900,000.00 and to plaintiffs Herman and Alberto Benedicto, the sum of at
least P300,000.00 each by way of actual damages and such other amounts as
proved during the trial;
2) Ordering the defendant to pay the plaintiffs the sum of P100,000.00 each
as moraldamages;
3) Ordering the defendant to pay the plaintiffs the sum of P100,000.00 each
as exemplarydamages;
4) Ordering the defendant to pay the plaintiffs the sum of P200,000.00
as attorney's fees, and to reimburse plaintiffs with all such sums paid to their
counsel by way of appearance fees.10 (Underscoring supplied)cralawlibrary
Respondent filed a Motion to Dismiss11 petitioners' complaint for damages on three
grounds - litis pendentia, res judicata and forum shopping.
By the assailed Order12 of August 26, 2005, Branch 43 of the Bacolod RTC
dismissed petitioners' complaint on the ground of prematurity, it holding that a
complaint for damages may only be maintained "after a final determination on the
forcible entry cases has been made."
Hence, the present Petition for Review .
forcible entry, petitioners can independently institute and maintain an action for
damages which they claim arose from incidents occurring after the dispossession
by respondent of the premises.
Petitioners meet the issue in the affirmative. Respondents assert otherwise.
The petition is impressed with merit.
Section 17, Rule 70 of the Rules of Court provides:
SEC. 17. Judgment. - If after trial the court finds that the allegations of the
complaint are true, it shall render judgment in favor of the plaintiff for the restitution
of the premises, the sum justly due as arrears of rent or as reasonable
compensation for the use and occupation of the premises, attorney's fees and
costs. If it finds that said allegations are not true, it shall render judgment for the
defendant to recover his costs. If a counterclaim is established, the court shall
render judgment for the sum found in arrears from either party and award costs as
justice requires. (Emphasis supplied)cralawlibrary
The recoverable damages in forcible entry and detainer cases thus refer to "rents"
or "the reasonable compensation for the use and occupation of the premises" or
"fair rental value of the property" and attorney's fees and costs. 13
The 2006 case of Dumo v. Espinas14 reiterates the long-established rule that the
only form of damages that may be recovered in an action for forcible entry is the
fair rental value or the reasonable compensation for the use and occupation of the
property:
Lastly, we agree with the CA and the RTC that there is no basis for the MTC to
award actual, moral, and exemplary damages in view of the settled rule that in
ejectment cases, the only damage that can be recovered is the fair rental value or
the reasonable compensation for the use and occupation of the property.
Considering that the only issue raised in ejectment is that of rightful possession,
damages which could be recovered are those which the plaintiff could have
sustained as a mere possessor, or those caused by the loss of the use and
occupation of the property, and not the damages which he may have suffered but
which have no direct relation to his loss of material possession. x x x15 (Emphasis,
underscoring and italics supplied; citations omitted)
Page 453 of 507
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Other damages must thus be claimed in an ordinary action.16
In asserting the negative of the issue, respondent cites the 1999 case of
Progressive Development Corporation, Inc. v. Court of Appeals.17 In this case,
Progressive Development Corporation, Inc. (Progressive), as lessor, repossessed
the leased premises from the lessee allegedly pursuant to their contract of lease
whereby it was authorized to do so if the lessee failed to pay monthly rentals. The
lessee filed a case for forcible entry with damages against Progressive before the
Metropolitan Trial Court (MeTC) of Quezon City. During the pendency of the case,
the lessee filed an action for damages before the RTC, drawing Progressive to file
a motion to dismiss based on litis pendentia. The RTC denied the motion.
On appeal by Progressive, the Court of Appeals sustained the RTC order denying
the motion to dismiss.
Progressive brought the case to this Court. Citing Section 1, Rule 70 of the Rules
of Court, this Court reversed the lower courts' ruling, it holding that "all cases for
forcible entry or unlawful detainer shall be filed before the Municipal Trial Court
which shall include not only the plea for restoration of possession but also all
claims for damages and costs therefrom." In other words, this Court held that "no
claim for damages arising out of forcible entry or unlawful detainer may be filed
separately and independently of the claim for restoration of
possession."18 (Underscoring supplied)cralawlibrary
In thus ruling, this Court in Progressive made a comparative study of the therein
two complaints, thus:
A comparative study of the two (2) complaints filed by private respondent against
petitioner before the two (2) trial courts shows that not only are the elements of res
adjudicata present, at least insofar as the claim for actual and compensatory
damages is concerned, but also that the claim for damages'moral and exemplary
in addition to actual and compensatory constitutes splitting a single cause of
action. Since this runs counter to the rule against multiplicity of suits, the dismissal
of the second action becomes imperative.
The complaint for forcible entry contains the following pertinent allegations'
2.01 On 02 January 1989, plaintiff entered into a contract of lease with defendant
PDC over a property designated as Ground Floor, Seafood Market (hereinafter
"Subject Premises") situated at the corner of EDSA corner MacArthur Street,
Araneta Center, Cubao, Quezon City, for a period of ten (10) years from 02
January 1989 to 30 April 1998.
2.02 Immediately after having acquired actual physical possession of the Subject
Premises, plaintiff established and now operates thereon the now famous Seafood
Market Restaurant. Since then, plaintiff had been in actual, continuous, and
peaceful physical possession of the Subject Premises until 31 October 1992.
x x x
3.02 Plaintiff, being the lessee of the Subject Premises, is entitled to the peaceful
occupation and enjoyment of the Subject Premises to the exclusion of all others,
including defendants herein.
3.03 Defendants' resort to strong arms tactics to forcibly wrest possession of the
Subject Premises from plaintiff and maintain possession thereof through the use of
force, threat, strategy and intimidation by the use of superior number of men and
arms amounts to the taking of the law into their own hands.
3.04 Thus, defendants' act of unlawfully evicting out plaintiff from the Subject
Premises it is leasing from defendant PDC and depriving it of possession thereof
through the use of force, threat, strategy and intimidation should be condemned
and declared illegal for being contrary to public order and policy.
3.05 Consequently, defendants should be enjoined from continuing with their
illegal acts and be ordered to vacate the Subject Premises and restore possession
thereof, together with its contents to plaintiff.
x x x
4.07 Considering that defendants' act of forcibly grabbing possession of the
Subject Premises from plaintiff is illegal and null and void, defendant should be
adjudged liable to plaintiff for all the aforedescribed damages which plaintiff
incurred as a result thereof.
The amended complaint for damages filed by private respondent alleges basically
the same factual circumstances and issues as bases for the relief prayed for, to
wit:
Page 454 of 507
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4. On May 28, 1991, plaintiff and defendant PDC entered into a Contract of Lease
for a period of ten years or from January 2, 1989 up to April 30, 1998 over a
property designated as Ground Floor, Seafood Market (hereinafter referred to as
Subject Premises) situated at the corner of EDSA corner McArthur Street, Araneta
Center, Cubao, Quezon City. A copy of the lease contract is attached hereto as
Annex "A."
5. Immediately thereafter, plaintiff took over actual physical possession of Subject
Premises, and established thereon the now famous "Seafood Market Restaurant."
x x x leased premises to the lessee, (b) the claim for actual damages due to the losses
7. On October 31, 1992 at around 8:30 p.m., defendant PDC, without the benefit of
any writ of possession or any lawful court order and with the aid of approximately
forty (40) armed security guards and policemen under the supervision of defendant
Tejam, forcibly entered the subject premises through force, intimidation, threats
and stealth and relying on brute force and in a thunderboltish manner and against
plaintiff's will, unceremoniously drew away all of plaintiffs men out of the subject
premises, thereby depriving herein plaintiff of its actual, physical and natural
possession of the subject premises. The illegal high-handed manner of gestapo
like take-over by defendants of subject premises is more particularly described as
follows: x x x x
8. To date, defendants continue to illegally possess and hold the Subject
Premises, including all the multi-million improvements, fixtures and equipment
therein owned by plaintiff, all to the damage and prejudice of plaintiff. The
actuations of defendants constitute an unlawful appropriation, seizure and taking of
property against the will and consent of plaintiff. Worse, defendants are
threatening to sell at public auction and without the consent, of plaintiff and without
lawful authority, the multi-million fixtures and equipment of plaintiff and at prices
way below the market value thereof. Plaintiff hereby attaches as Annex "B" the
letter from defendants dated August 6, 1993 addressed to plaintiff, informing the
latter that the former intends to sell at an auction on August 19, 1993 at 2:00 p.m.
properties of the plaintiff presently in defendants' possession.
x x x decapitating the heads of some of them, after the act of dispossession had
12. Defendant's unlawful takeover of the premises constitutes a violation of its
obligation under Art. 1654 of the New Civil Code requiring the lessor to maintain
the lessee in peaceful and adequate enjoyment of the lease for the entire duration
of the contract. Hence, plaintiff has filed the present suit for the recovery of
damages under Art. 1659 of the New Civil Code x x x x 19 (Emphasis in the original;
underscoring supplied)
Analyzing the two complaints, this Court, still in Progressive, observed:
Restated in its bare essentials, the forcible entry case has one cause of action,
namely, the alleged unlawful entry by petitioner into the leased premises out of
which three (3) reliefs (denominated by private respondent as its causes of action)
arose: (a) the restoration by the lessor (petitioner herein) of the possession of the
suffered by private respondent such as the deterioration of perishable foodstuffs
stored inside the premises and the deprivation of the use of the premises causing
loss of expected profits; and, (c) the claim for attorney's fees and costs of suit.
On the other hand, the complaint for damages prays for a monetary award
consisting of (a) moral damages of P500,000.00 and exemplary damages of
another P500,000.00; (b) actual damages of P20,000.00 and compensatory
damages of P1,000,000.00 representing unrealized profits; and, (c) P200,000.00
for attorney's fees and costs, all based on the alleged forcible takeover of the
leased premises by petitioner. Since actual and compensatory damages were
already prayed for in the forcible entry case before the MeTC, it is obvious that this
cannot be relitigated in the damage suit before the RTC by reason of res
adjudicata.
The other claims for moral and exemplary damages cannot also succeed
considering that these sprung from the main incident being heard before the
MeTC. x x x20 (Italics in the original; Emphasis and underscoring supplied)
It bears noting, however, that as reflected in the earlier-quoted allegations in the
complaint for damages of herein petitioners, their claim for damages
have no direct relation to their loss of possession of the premises. It had to do with
respondent's alleged harvesting and carting away several tons of milkfish and
other marine products in their fishponds, ransacking and destroying of a chapel
built by petitioner CGR Corporation, and stealing religious icons and even
occurred.
Surely, one of the elements of litis pendentia - that the identity between the
pending actions, with respect to the parties, rights asserted and reliefs prayed for,
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is such that any judgment rendered on one action will, regardless of which is
successful, amount to res judicata in the action under consideration - is not
present, hence, it may not be invoked to dismiss petitioners' complaint for
damages.21
Res judicata may not apply because the court in a forcible entry case has no
jurisdiction over claims for damages other than the use and occupation of the
premises and attorney's fees.22
Neither may forum-shopping justify a dismissal of the complaint for damages, the
elements of litis pendentia not being present, or where a final judgment in the
forcible entry case will not amount to res judicata in the former.23
Petitioners' filing of an independent action for damages other than those sustained
as a result of their dispossession or those caused by the loss of their use and
occupation of their properties could not thus be considered as splitting of a cause
of action.
WHEREFORE, the Orders dated August 26, 2005 and January 2, 2006 issued by
the Regional Trial Court, Branch 43, Bacolod City, in Civil Case No. 04-12284 are
REVERSED and SET ASIDE.
The Regional Trial Court, Branch 43, Bacolod City, is directed to REINSTATE Civil
Case No. 04-12284 to its docket and to conduct proceedings thereon with
dispatch.
SO ORDERED.
G.R. No. 202354, September 24, 2014
AMADA C. ZACARIAS, Petitioner, v. VICTORIA ANACAY, EDNA ANACAY,
CYNTHIA ANACAY-GUISIC, ANGELITO ANACAY, JERMIL ISRAEL, JIMMY
ROY ISRAEL AND ALL OTHER PERSONS CLAIMING AUTHORITY UNDER
THEM, Respondents.
DECISION
VILLARAMA, JR., J.:
Assailed in this petition for review under Rule 45 is the Decision1 dated June 20,
2012 of the Court of Appeals (CA) in CA-G.R. SP No. 123195 which reversed the
Decision2 dated August 22, 2011 of the Regional Trial Court (RTC) of Cavite,
Branch 18, Tagaytay City and affirmed the Decision3 dated October 8, 2010 of the
Municipal Circuit Trial Court (MCTC) of Amadeo-Silang, Cavite, Branch 17 in Civil
Case No. 862.
The present controversy stemmed from a complaint4 for Ejectment with
Damages/Unlawful Detainer filed on December 24, 2008 by petitioner Amada
Zacarias thru her son and attorney-in-fact, Cesar C. Zacarias, against the above-
named respondents, Victoria Anacay and members of her household. Said
respondents are the occupants of a parcel of land with an area of seven hundred
sixty-nine (769) square meters, situated at Barangay Lalaan 1st, Silang, Cavite
and covered by Tax Declaration No. 18-026-01182 in the name of petitioner and
issued by Municipal Assessor Reynaldo L. Bayot on August 31, 2007.
The parties were ordered to proceed to the Philippine Mediation Center pursuant
to Section 2(a), Rule 18 of the 1997 Rules of Civil Procedure, as
amended. Mediation was unsuccessful and thus the case was returned to the
court.5cralawlawlibrary
After due proceedings, the MCTC rendered a Decision dismissing the complaint,
the dispositive portion of which reads:chanRoblesvirtualLawlibrary
WHEREFORE, premises considered, judgment is, hereby, rendered in favor of
defendants Victoria Anacay, Edna Anacay, Santiago Amerna, Raymond and
Cynthia Guisic, Angelito Anacay and Myrlinda Yalo, and all persons acting under
them, and against plaintiff Amada C. Zacarias, represented by her attorney-in-fact,
Cesar C. Zacarias, the instant Complaint for ejectment with damages, Unlawful
Detainer is, hereby, DISMISSED.
SO ORDERED.6
The MCTC held that the allegations of the complaint failed to state the essential
elements of an action for unlawful detainer as the claim that petitioner had
permitted or tolerated respondents’ occupation of the subject property was
unsubstantiated. It noted that the averments in the demand letter sent by
petitioner’s counsel that respondents entered the property through stealth and
strategy, and in petitioner’s own “Sinumpaang Salaysay”, are more consistent with
Page 456 of 507
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an action for forcible entry which should have been filed within one year from the
discovery of the alleged entry. Since petitioner was deprived of the physical
possession of her property through illegal means and the complaint was filed after
the lapse of one year from her discovery thereof, the MCTC ruled that it has no
jurisdiction over the case.
On appeal to the RTC, petitioner argued that unlawful detainer was the proper
remedy considering that she merely tolerated respondents’ stay in the premises
after demand to vacate was made upon them, and they had in fact entered into an
agreement and she was only forced to take legal action when respondents
reneged on their promise to vacate the property after the lapse of the period
agreed upon.
In reversing the MCTC, the RTC pointed out that in her complaint, petitioner did
not state that respondents entered her property through stealth and strategy but
that petitioner was in lawful possession and acceded to the request of respondents
to stay in the premises until May 2008 but respondents’ reneged on their promise
to vacate the property by that time. It held that the suit is one for unlawful detainer
because the respondents unlawfully withheld the property from petitioner after she
allowed them to stay there for one year.
With the subsequent oral agreement between the parties, the RTC ruled that
respondents’ occupation of the property without petitioner’s consent can be
converted to a contract, such agreement not being prohibited by law nor contrary
to morals or good customs. Having satisfied the requisites for an unlawful detainer
action, the RTC found that petitioner’s complaint was filed within the prescribed
one-year period counted from the time the final demand to vacate was received by
the respondents on July 24, 2008.
The fallo of the Decision of the RTC states:chanRoblesvirtualLawlibrary
WHEREFORE, premises considered, the Decision of the Municipal Circuit Trial
Court of Silang-Amadeo dated October 8, 2010 is hereby REVERSED AND SET
ASIDE and a new one is entered ordering the defendants and all claiming under
their rights to: (1) vacate the subject property and surrender possession and
control over the same to the plaintiff; Pay the sum of Two Thousand (P2,000.00)
Pesos each as rentals or compensation for the use thereof starting from July 2008
until the same is paid in full, with interests thereon at twelve (12%) percent per
annum; (2) pay the sum of Fifty Thousand (P50,000.00) Pesos, as moral
damages; (3) pay the sum of Ten Thousand (P10,000.00) Pesos, as exemplary
damages; and (4) pay the sum of Twenty Thousand (P20,000.00) Pesos, as
attorney’s fees.
SO ORDERED.7
With the failure of respondents to file a notice of appeal within the reglementary
period, the above decision became final and executory.8cralawlawlibrary
On November 28, 2011, petitioner filed a motion for issuance of a writ of
execution. At the hearing held on January 4, 2012, respondents were given a
period of ten days within which to file their comment. At the next scheduled
hearing on February 6, 2012, respondents’ counsel appeared and submitted a
Formal Entry of Appearance with Manifestation informing the court that on the
same day they had filed a petition for certiorari with prayer for injunction before the
CA, copies of which were served to petitioner thru her counsel and to the RTC.
Nonetheless, in its Order dated February 6, 2012, the RTC stated that said
manifestation was “tantamount to [a] comment to the pending motion” and thus
gave petitioner’s counsel a period of ten (10) days within which to file her Reply
and thereafter the incident will be submitted for resolution.9cralawlawlibrary
On June 20, 2012, the CA rendered its Decision, the dispositive portion of which
reads:chanRoblesvirtualLawlibrary
WHEREFORE, the petition is GRANTED. Accordingly, the assailed Order dated
August 22, 2011 rendered by the Regional Trial Court of Cavite, 4th Judicial
Region, Branch 18, Tagaytay City is REVERSED and SET ASIDE. The Decision
dated October 8, 2010 rendered by the Municipal Circuit Trial Court, Branch 17
is AFFIRMED.
SO ORDERED.10
The CA held that the MCTC clearly had no jurisdiction over the case as the
complaint did not satisfy the jurisdictional requirement of a valid cause for unlawful
detainer. Since the prescriptive period for filing an action for forcible entry has
lapsed, petitioner could not convert her action into one for unlawful detainer,
reckoning the one-year period to file her action from the time of her demand for
respondents to vacate the property.
Further, the CA said that while petitioner has shown that she is the lawful
possessor of the subject property, she availed of the wrong remedy to recover
possession but nevertheless may still file an accion publiciana or accion
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reivindicatoria with the proper regional trial court.
Petitioner contends that the CA erred and committed grave abuse of discretion
amounting to lack and/or excess of jurisdiction in nullifying the judgment of the
RTC which has long become final and executory. She argues that the suspension
of the strict adherence to procedural rules cannot be justified by unsupported
allegations of the respondents as to supposed non-receipt of documents
concerning this case.
On their part, respondents maintain that they were not aware of the proceedings
before the RTC and were not furnished a copy of the said court’s adverse
decision. They also stress that resort to certiorariwas proper and the suspension
of procedural rules was justified by compelling circumstances such as the
imminent destruction of the only property possessed by respondents who are
indigent, respondents’ lack of awareness of unfavorable judgment rendered on
appeal by the RTC, substantive merits of the case insofar as the jurisdictional
requirements in a suit for unlawful detainer, lack of showing that resort
to certiorari petition was frivolous and dilatory, and there being no prejudice
caused to the other party.
After a thorough review of the records and the parties’ submissions, we find neither
reversible error nor grave abuse of discretion committed by the CA.
The invariable rule is that what determines the nature of the action, as well as the
court which has jurisdiction over the case, are the allegations in the complaint. 11 In
ejectment cases, the complaint should embody such statement of facts as to bring
the party clearly within the class of cases for which Section 112 of Rule 70 provides
a summary remedy, and must show enough on its face to give the court jurisdiction
without resort to parol evidence.13 Such remedy is either forcible entry or unlawful
detainer. In forcible entry, the plaintiff is deprived of physical possession of his land
or building by means of force, intimidation, threat, strategy or stealth. In illegal
detainer, the defendant unlawfully withholds possession after the expiration or
termination of his right thereto under any contract, express or
implied.14cralawlawlibrary
The MCTC and CA both ruled that the allegations in petitioner’s complaint make
out a case for forcible entry but not for unlawful detainer.
In Cabrera v. Getaruela,15 the Court held that a complaint sufficiently alleges a
cause of action for unlawful detainer if it recites the
following:chanRoblesvirtualLawlibrary
(1) initially, possession of property by the defendant was by contract with or by
tolerance of the plaintiff;
(2) eventually, such possession became illegal upon notice by plaintiff to defendant
of the termination of the latter’s right of possession;
(3) thereafter, the defendant remained in possession of the property and deprived
the plaintiff of the enjoyment thereof; and
(4) within one year from the last demand on defendant to vacate the property, the
plaintiff instituted the complaint for ejectment.16cralawlawlibrary
In this case, the Complaint alleged the following:chanroblesvirtuallawlibrary
3. Plaintiff is the owner of that parcel of land situated at Barangay Lalaan 1st ,
Silang, Cavite with an area of SEVEN HUNDRED SIXTY NINE (769) SQUARE
METERS, and covered by Tax Declaration No. 18-026-01182 issued by the
Municipal Assessor of Silang, Cavite. Copy of said tax declaration is hereto
attached as Annex “B”;
4. Plaintiff was in lawful possession and control over the subject property. She
had it planted to Bananas and other fruit bearing trees. However, sometime in
May, 2007, she discovered that the defendants have entered the subject property
and occupied the same;
5. Consequently, Plaintiff demanded that they leave the premises. The
defendants requested for time to leave and she acceded to said request. The
defendants committed to vacate the subject property by the end of May, 2008;
6. Inspite of several repeated demands, defendants unjustifiably refused to vacate
the subject premises prompting the Plaintiff to seek the assistance of a lawyer who
wrote them a FORMAL and FINAL DEMAND to vacate the premises and to pay
reasonable compensation for their illegal use and occupancy of the subject
property. A copy of the DEMAND LETTER is hereto attached as Annex “C”;
7. Plaintiff also referred this matter to the Lupon Tagapamayapa of Barangay
Lalaan 1st for possible conciliation but to no avail as the defendants still refused to
vacate the subject property. Thus, the said Barangay issued a CERTIFICATION
TO FILE ACTION, as evidenced by a copy thereto attached as Annex “D”;
x x x x17chanrobleslaw
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The above complaint failed to allege a cause of action for unlawful detainer as it
does not describe possession by the respondents being initially legal or tolerated
by the petitioner and which became illegal upon termination by the petitioner of
such lawful possession. Petitioner’s insistence that she actually tolerated
respondents’ continued occupation after her discovery of their entry into the
subject premises is incorrect. As she had averred, she discovered respondents’
occupation in May 2007. Such possession could not have been legal from the start
as it was without her knowledge or consent, much less was it based on any
contract, express or implied. We stress that the possession of the defendant in
unlawful detainer is originally legal but became illegal due to the expiration or
termination of the right to possess.18cralawlawlibrary
In Valdez v. Court of Appeals,19 the Court ruled that where the complaint did not
satisfy the jurisdictional requirement of a valid cause for unlawful detainer, the
municipal trial court had no jurisdiction over the
case. Thus:chanRoblesvirtualLawlibrary
To justify an action for unlawful detainer, it is essential that the plaintiff’s
supposed acts of tolerance must have been present right from the start of
the possession which is later sought to be recovered. Otherwise, if the
possession was unlawful from the start, an action for unlawful detainer
would be an improper remedy. As explained in Sarona v.
Villegas:chanroblesvirtuallawlibrary
But even where possession preceding the suit is by tolerance of the owner, still,
distinction should be made.
If right at the incipiency defendant’s possession was with plaintiff’s tolerance, we
do not doubt that the latter may require him to vacate the premises and sue before
the inferior court under Section 1 of Rule 70, within one year from the date of the
demand to vacate.
xxxx
A close assessment of the law and the concept of the word “tolerance” confirms
our view heretofore expressed that such tolerance must be present right from the
start of possession sought to be recovered, to categorize a cause of action as one
of unlawful detainer - not of forcible entry. Indeed, to hold otherwise would
espouse a dangerous doctrine. And for two reasons: First. Forcible entry into the
land is an open challenge to the right of the possessor. Violation of that right
authorizes the speedy redress – in the inferior court - provided for in the rules. If
one year from the forcible entry is allowed to lapse before suit is filed, then the
remedy ceases to be speedy; and the possessor is deemed to have waived his
right to seek relief in the inferior court. Second, if a forcible entry action in the
inferior court is allowed after the lapse of a number of years, then the result may
well be that no action of forcible entry can really prescribe. No matter how long
such defendant is in physical possession, plaintiff will merely make a demand,
bring suit in the inferior court – upon a plea of tolerance to prevent prescription to
set in - and summarily throw him out of the land. Such a conclusion is
unreasonable. Especially if we bear in mind the postulates that proceedings of
forcible entry and unlawful detainer are summary in nature, and that the one year
time-bar to suit is but in pursuance of the summary nature of the action. (Italics and
underscoring supplied)
It is the nature of defendant’s entry into the land which determines the cause of
action, whether it is forcible entry or unlawful detainer. If the entry is illegal, then
the action which may be filed against the intruder is forcible entry. If, however, the
entry is legal but the possession thereafter becomes illegal, the case is unlawful
detainer.
Indeed, to vest the court jurisdiction to effect the ejectment of an occupant, it is
necessary that the complaint should embody such a statement of facts as brings
the party clearly within the class of cases for which the statutes provide a remedy,
as these proceedings are summary in nature. The complaint must show enough
on its face the court jurisdiction without resort to parol testimony.
The jurisdictional facts must appear on the face of the complaint. When the
complaint fails to aver facts constitutive of forcible entry or unlawful detainer, as
where it does not state how entry was affected or how and when dispossession
started, the remedy should either be an accion publiciana or an accion
reivindicatoria in the proper regional trial court. Thus, in Go, Jr. v. Court of
Appeals, petitioners filed an unlawful detainer case against respondent alleging
that they were the owners of the parcel of land through intestate succession which
was occupied by respondent by mere tolerance of petitioners as well as their
deceased mother. Resolving the issue on whether or not petitioners’ case for
unlawful detainer will prosper, the court ruled:chanroblesvirtuallawlibrary
Petitioners alleged in their complaint that they inherited the property registered
under TCT No. C-32110 from their parents; that possession thereof by private
respondent was by tolerance of their mother, and after her death, by their own
tolerance; and that they had served written demand on December, 1994, but that
private respondent refused to vacate the property. x x x
It is settled that one whose stay is merely tolerated becomes a deforciant illegally
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occupying the land the moment he is required to leave. . The appellate court, in
full agreement with the MTC made the conclusion that the alleged tolerance by
their mother and after her death, by them, was unsubstantiated. x x x
The evidence revealed that the possession of defendant was illegal at the
inception and not merely tolerated as alleged in the complaint, considering
that defendant started to occupy the subject lot and then built a house
thereon without the permission and consent of petitioners and before them,
their mother. xxx Clearly, defendant’s entry into the land was effected
clandestinely, without the knowledge of the owners, consequently, it is
categorized as possession by stealth which is forcible entry. As explained
in Sarona vs. Villegas, cited in Muñoz vs. Court of Appeals [224 SCRA 216 (1992)]
tolerance must be present right from the start of possession sought to be
recovered, to categorize a cause of action as one of unlawful detainer not of
forcible entry x x x.
xxxx
In the instant case, the allegations in the complaint do not contain any averment of
fact that would substantiate petitioners’ claim that they permitted or tolerated the
occupation of the property by respondents. The complaint contains only bare
allegations that “respondents without any color of title whatsoever occupies the
land in question by building their house in the said land thereby depriving
petitioners the possession thereof.” Nothing has been said on how respondents’
entry was effected or how and when dispossession started. Admittedly, no
express contract existed between the parties. This failure of petitioners to allege
the key jurisdictional facts constitutive of unlawful detainer is fatal. Since the
complaint did not satisfy the jurisdictional requirement of a valid cause for unlawful
detainer, the municipal trial court had no jurisdiction over the case. It is in this light
that this Court finds that the Court of Appeals correctly found that the municipal
trial court had no jurisdiction over the complaint. (Emphasis supplied.)
The complaint in this case is similarly defective as it failed to allege how and when
entry was effected. The bare allegation of petitioner that “sometime in May, 2007,
she discovered that the defendants have entered the subject property and
occupied the same”, as correctly found by the MCTC and CA, would show that
respondents entered the land and built their houses thereon clandestinely and
without petitioner’s consent, which facts are constitutive of forcible entry, not
unlawful detainer. Consequently, the MCTC has no jurisdiction over the case and
the RTC clearly erred in reversing the lower court’s ruling and granting reliefs
prayed for by the petitioner.
Lastly, petitioner’s argument that the CA gravely erred in nullifying a final and
executory judgment of the RTC deserves scant consideration.
It is well-settled that a court’s jurisdiction may be raised at any stage of the
proceedings, even on appeal. The reason is that jurisdiction is conferred by law,
and lack of it affects the very authority of the court to take cognizance of and to
render judgment on the action.20 Indeed, a void judgment for want of jurisdiction
is no judgment at all. It cannot be the source of any right nor the creator of any
obligation. All acts performed pursuant to it and all claims emanating from it have
no legal effect. Hence, it can never become final and any writ of execution based
on it is void.21cralawlawlibrary
WHEREFORE, the petition is DENIED for lack of merit. The Decision dated June
20, 2012 of the Court of Appeals in CA-G.R. SP No. 123195 is hereby AFFIRMED.
No pronouncement as to costs.
SO ORDERED.cral
G.R. No. 198356, April 20, 2015
ESPERANZA SUPAPO AND THE HEIRS OF ROMEO SUPAPO, NAMELY:
ESPERANZA, REX EDWARD, RONALD TROY, ROMEO, JR., SHEILA
LORENCE, ALL SURNAMED SUPAPO, AND SHERYL FORTUNE SUPAPO-
SANDIGAN, Petitioners, v. SPOUSES ROBERTO AND SUSAN DE JESUS,
MACARIO BERNARDO, AND THOSE PERSONS CLAIMING RIGHTS UNDER
THEM, Respondent.
DECISION
BRION, J.:
We resolve the petition for review on certiorari1 filed by petitioners Esperanza
Supapo and Romeo Supapo2 (Spouses Supapo) to assail the February 25, 2011
decision3 and August 25, 2011 resolution4 of the Court of Appeals (CA) in CA-G.R.
SP No. 111674.
Page 460 of 507
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 Factual Antecedents
The Spouses Supapo filed a complaint5 for accion publiciana against Roberto and
Susan de Jesus (Spouses de Jesus), Macario Bernardo (Macario), and persons
claiming rights under them (collectively, the respondents), with the Metropolitan
Trial Court (MeTC) of Caloocan City.
The complaint sought to compel the respondents to vacate a piece of land located
in Novaliches, Quezon City, described as Lot 40, Block 5 (subject lot). The subject
lot is covered by Transfer Certificate of Title (TCT) No. C-284416 registered and
titled under the Spouses Supapo's names. The land has an assessed value of
thirty-nine thousand nine hundred eighty pesos (39,980.00) as shown in the
Declaration of Real Property Value (tax declaration) issued by the Office of the City
Assessor of Caloocan.7
The Spouses Supapo did not reside on the subject lot. They also did not employ
an overseer but they made sure to visit at least twice a year. 8 During one of their
visits in 1992, they saw two (2) houses built on the subject lot. The houses were
built without their knowledge and permission. They later learned that the Spouses
de Jesus occupied one house while Macario occupied the other one. 9
The Spouses Supapo demanded from the respondents the immediate surrender of
the subject lot by bringing the dispute before the appropriate Lupong
Tagapamayapa. The Lupon issued a Katibayan Upang Makadulog sa
Hukuman (certificate to file action) for failure of the parties to settle amicably.10
The Spouses Supapo then filed a criminal case11 against the respondents for
violation of Presidential Decree No. 772 or the Anti-Squatting Law.12 The trial court
convicted the respondents. The dispositive portion of the decision reads:
WHEREFORE, in view of all the foregoing, this Court finds accused ROBERTO
DE JESUS, SUSAN DE JESUS and MACARIO BERNARDO, GUILTY beyond
reasonable doubt for Violation of Presidential Decree No. 772, and each accused
is hereby ordered to pay a fine of ONE THOUSAND PESOS (P1,000.00), and to
vacate the subject premises.
SO ORDERED.13 (Emphasis supplied.)
The respondents appealed their conviction to the CA.14 While the appeal was
pending, Congress enacted Republic Act (RA) No. 8368, otherwise known as "An
Act Repealing Presidential Decree No. 772," which resulted to the dismissal of the
criminal case.15
On April 30, 1999, the CA's dismissal of the criminal case became final. 16
Notwithstanding the dismissal, the Spouses Supapo moved for the execution of
the respondents' civil liability, praying that the latter vacate the subject lot. The
Regional Trial Court (RTC) granted the motion and issued the writ of execution.
The respondents moved for the quashal of the writ but the RTC denied the same.
The RTC also denied the respondents' motion for reconsideration.
The respondents thus filed with the CA a petition for certiorari to challenge the
RTC's orders denying the quashal of the writ and the respondent's motion for
reconsideration.17 The CA granted the petition and held that with the repeal of
the Anti-Squatting Law, the respondents' criminal and civil liabilities were
extinguished.18 The dispositive portion of the decision reads:
WHEREFORE, premises considered, the petition for certiorari with prayer for
injunction is GRANTED. The orders dated June 5, 2003 and July 24, 2003 of
Branch 131 of the Regional Trial Court of Caloocan City in Criminal Case No. C-
45610 are REVERSED and SET ASIDE. Said court is hereby
permanently ENJOINED from further executing or implementing its decision dated
March 18, 1996.
SO ORDERED.
The CA, however, underscored that the repeal of the Anti-Squatting Law does not
mean that people now have unbridled license to illegally occupy lands they do not
own, and that it was not intended to compromise the property rights of legitimate
landowners.19 In cases of violation of their property rights, the CA noted that
recourse may be had in court by filing the proper action for recovery of possession.
The Spouses Supapo thus filed the complaint for action publiciana.20
After filing their Answer,21 the respondents moved to set their affirmative defenses
for preliminary hearing22 and argued that: (1) there is another action pending
between the same parties; (2) the complaint for accion publiciana is barred by
statute of limitations; and (3) the Spouses Supapo's cause of action is barred by
prior judgment.
The MeTC Ruling23
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The MeTC denied the motion to set the affirmative defenses for preliminary
hearing. It ruled that the arguments advanced by the respondents are evidentiary
in nature, which at best can be utilized in the course of the trial. The MeTC likewise
denied the respondents' motion for reconsideration.
From the MeTC's ruling, the respondents filed a petition for certiorari with the
RTC.24
The RTC Ruling25
The RTC granted the petition for certiorari on two grounds, viz.: (i) the action has
prescribed; and (ii) accion publiciana falls within the exclusive jurisdiction of the
RTC.
It held that in cases where the only issue involved is possession, the MeTC has
jurisdiction if the action for forcible entry or unlawful detainer is filed within one (1)
year from the time to demand to vacate was made. Otherwise, the complaint for
recovery of possession should be filed before the RTC.
The dispositive portion of the RTC decision reads:
WHEREFORE, premises considered, the instant petition is hereby GRANTED.
The Orders dated October 24, 2008 and February 23, 2009 are hereby
declared NULL and VOID.
The Public Respondent is hereby directed to DISMISS Civil Case No. 08-29245
for lack of jurisdiction.
SO ORDERED.26
In their motion for reconsideration,27 the Spouses Supapo emphasized that the
court's jurisdiction over an action involving title to or possession of land is
determined by its assessed value; that the RTC does not have an exclusive
jurisdiction on all complaints for accion publiciana; and that the assessed value of
the subject lot falls within MeTC's jurisdiction.
The RTC denied the petitioners' motion for reconsideration.
It held that although the MeTC had jurisdiction based on the assessed value of the
subject lot, the Spouses Supapos' cause of action had already prescribed, the
action having been filed beyond the ten (l0)-year prescriptive period under Article
555 of the Civil Code.28 As it was not proven when the actual demand to vacate
was made, the RTC ruled that the reckoning period by which the ejectment suit
should have been filed is counted from the time the certificate to file action was
issued. The certificate to file action was issued on November 25, 1992, while the
complaint for accion publiciana was filed only on March 7, 2008, or more than ten
(10) years thereafter.
Dissatisfied with the RTC ruling, the Spouses Supapo appealed to the CA. 29
The CA Ruling30
The CA dismissed the appeal and held that the complaint for accion
publiciana should have been lodged before the RTC and that the period to file the
action had prescribed.
The dispositive portion of the CA decision reads:
WHEREFORE, the appeal is DENIED. The Decision dated June 30, 2009 and
Order dated October 19, 2009 are AFFIRMED.
SO ORDERED
The Spouses Supapo moved31 but failed32 to secure a reconsideration of the CA
decision; hence, they came to us through the present petition.
The Petition
In seeking reversal of the CA's ruling, the Spouses Supapo essentially argue that:
(1) the MeTC exercises exclusive original jurisdiction over accion
publiciana where the assessed value of the property does not exceed
P20,000.00, or P50,000.00 if the property is located in Metro Manila; and
that
(2) prescription had not yet set in because their cause of action is
imprescriptible under the Torrens system.
The Respondents' Case33
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The respondents argue that the complaint for accion publiciana was (1) filed in the
wrong court; (2) barred by prescription; and (3) barred by res judicata.
Issues
The issues for resolution are:
I. Whether the MeTC properly acquired jurisdiction;
II. Whether the cause of action has prescribed; and
III. Whether the complaint for accion publiciana is barred by res judicata.
Our Ruling
The petition is meritorious.
We hold that: (1) the MeTC properly acquired jurisdiction; (2) the cause of action
has not prescribed; and (3) the complaint is not barred by res judicata.
Accion Publiciana and
the Jurisdiction of the
MeTC
Accion publiciana is an ordinary civil proceeding to determine the better right of
possession of realty independent of title. It refers to an ejectment suit filed after the
expiration of one year from the accrual of the cause of action or from the unlawful
withholding of possession of the realty.34
In the present case, the Spouses Supapo filed an action for the recovery of
possession of the subject lot but they based their better right of possession on a
claim of ownership.
This Court has held that the objective of the plaintiffs in accion publiciana is to
recover possession only, not ownership. However, where the parties raise the
issue of ownership, the courts may pass upon the issue to determine who between
the parties has the right to possess the property.35
This adjudication is not a final determination of the issue of ownership; it is only for
the purpose of resolving the issue of possession, where the issue of ownership is
inseparably linked to the issue of possession. The adjudication of the issue of
ownership, being provisional, is not a bar to an action between the same parties
involving title to the property. The adjudication, in short, is not conclusive on the
issue of ownership.36
Thus, while we will dissect the Spouses Supapo's claim of ownership over the
subject property, we will only do so to determine if they or the respondents should
have the right of possession.
Having thus determined that the dispute involves possession over a real property,
we now resolve which court has the jurisdiction to hear the case.
Under Batas Pambansa Bilang 129,37 the jurisdiction of the RTC over actions
involving title to or possession of real property is plenary. 38
RA No. 7691,39 however, divested the RTC of a portion of its jurisdiction and
granted the Metropolitan Trial Courts, Municipal Trial Courts and Municipal Circuit
Trial Courts the exclusive and original jurisdiction to hear actions where the
assessed value of the property does not exceed Twenty Thousand Pesos
(P20,000.00), or Fifty Thousand Pesos (P50,000.00), if the property is located in
Metro Manila.
Section 1 of RA No. 7691 states:
Section 1. Section 19 of Batas Pambansa Blg. 129, otherwise known as the
"Judiciary Reorganization Act of 1980," is hereby amended to read as follows:
Section. 19. Jurisdiction in civil cases. - Regional Trial Courts shall exercise
exclusive original jurisdiction:
(2) In all civil actions which involve the title to, or possession of, real property, or
any interest therein, where the assessed value of the property involved
exceeds Twenty thousand pesos (P20,000.00) or, for civil actions in Metro
Manila, where such value exceeds Fifty thousand pesos (P50,000.00) x x x.
(Emphasis supplied.)
Section 3 of the same law provides:
Section. 3. Section 33 of the same law is hereby amended to read as follows:
Section. 33. Jurisdiction of Metropolitan Trial Courts, Municipal Trial Courts and
Municipal Circuit Trial Courts in Civil Cases. - Metropolitan Trial Courts,
Municipal Trial Courts, and Municipal Circuit Trial Courts shall exercise:
xxxx
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(3) Exclusive original jurisdiction in all civil actions which involve title to,
or possession of, real property, or any interest therein where the assessed value
of the property or interest therein does not exceed Twenty thousand pesos
(P20,000.00) or, in civil actions in Metro Manila, where such assessed value
does not exceed Fifty thousand pesos (P50,000.00) exclusive of interest,
damages of whatever kind, attorney's fees, litigation expenses and costs x x x.
(Emphasis supplied.)
In view of these amendments, jurisdiction over actions involving title to or
possession of real property is now determined by its assessed value.40 The
assessed value of real property is its fair market value multiplied by the
assessment level. It is synonymous to taxable value.41
In Quinagoran v. Court of Appeals,42 we explained:
[D]oes the RTC have jurisdiction over all cases of recovery of possession
regardless of the value of the property involved?
The answer is no. The doctrine on which the RTC anchored its denial of
petitioner's Motion to Dismiss, as affirmed by the CA — that all cases of recovery
of possession or accion publiciana lies with the regional trial courts regardless of
the value of the property — no longer holds true. As tilings now stand, a
distinction must be made between those properties the assessed value of
which is below P20,000.00, if outside Metro Manila; and P50,000.00, if
within.43 (Emphasis supplied.)
In this regard, the complaint must allege the assessed value of the real property
subject of the complaint or the interest thereon to determine which court has
jurisdiction over the action. This is required because the nature of the action and
the court with original and exclusive jurisdiction over the same is determined by the
material allegations of the complaint, the type of relief prayed for by the plaintiff,
and the law in effect when the action is filed, irrespective of whether the plaintiffs
are entitled to some or all of the claims asserted therein.44
In the present case, the Spouses Supapo alleged that the assessed value of the
subject lot, located in Metro Manila, is P39,980.00. This is proven by the tax
declaration45 issued by the Office of the City Assessor of Caloocan. The
respondents do not deny the genuineness and authenticity of this tax declaration.
Given that the Spouses Supapo duly complied with the jurisdictional requirements,
we hold that the MeTC of Caloocan properly acquired jurisdiction over the
complaint for accion publiciana.
The cause of action
has not prescribed
The respondents argue that the complaint for accion publiciana is dismissible for
being filed out of time.
They invoke Article 555 of the Civil Code, which states: Art. 555. A possessor may
lose his possession:
xxxx
(4) By the possession of another, subject to the provisions of Article 537, if the
new possession has lasted longer than one year. But the real right of
possession is not lost till after the lapse of ten years. (Emphasis supplied.)
The respondents point out that the Spouses Supapo filed the complaint for accion
publiciana on March 7, 2008 or more than ten (10) years after the certificate to file
action was issued on November 25, 1992. The respondents contend that the
Spouses Supapo may no longer recover possession of the subject property, the
complaint having been filed beyond the period provided by law.
Further, while the respondents concede that the Spouses Supapo hold a TCT over
the subject property, and assuming a Torrens title is imprescriptible and
indefeasible, they posit that the latter have lost their right to recover possession
because of laches.
On their part, the Spouses Supapo admit that they filed the complaint for accion
publiciana more than ten (10) years after the certificate to file action was issued.
Nonetheless, they argue that their cause of action is imprescriptible since the
subject property is registered and titled under the Torrens system.
We rule that the Spouses Supapo's position is legally correct.
At the core of this controversy is a parcel of land registered under the Torrens
system. The Spouses Supapo acquired the TCT on the subject lot in
1979.46 Interestingly, the respondents do not challenge the existence,
authenticity and genuineness of the Supapo's TCT.47
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In defense, the respondents rest their entire case on the fact that they have
allegedly been in actual, public, peaceful and uninterrupted possession of the
subject property in the concept of an owner since 1992. The respondents contend
that they built their houses on the subject lot in good faith. Having possessed the
subject lot for more than ten (10) years, they claim that they can no longer be
disturbed in their possession.48
Under the undisputed facts of this case, we find that the respondents' contentions
have no legal basis.
In a long line of cases, we have consistently ruled that lands covered by a title
cannot be acquired by prescription or adverse possession. We have also held
that a claim of acquisitive prescription is baseless when the land involved is a
registered land because of Article 112649 of the Civil Code in relation to Act 496
[now, Section 47 of Presidential Decree (PD) No. 1529 50].51
The Spouses Supapo (as holders of the TCT) enjoy a panoply of benefits under
the Torrens system. The most essential insofar as the present case is concerned
is Section 47 of PD No. 1529 which states:
Section 47. Registered land not subject to prescriptions. No title to registered land
in derogation of the title of the registered owner shall be acquired by prescription or
adverse possession.
In addition to the imprescriptibility, the person who holds a Torrens Title over a
land is also entitled to the possession thereof.52 The right to possess and occupy
the land is an attribute and a logical consequence of ownership.53 Corollary to this
rule is the right of the holder of the Torrens Title to eject any person illegally
occupying their property. Again, this right is imprescriptible. 54
In Bishop v. CA,55 we held that even if it be supposed that the holders of the
Torrens Title were aware of the other persons' occupation of the
property, regardless of the length of that possession, the lawful owners have a
right to demand the return of their property at any time as long as the possession
was unauthorized or merely tolerated, if at all.56
Even if the defendant attacks the Torrens Title because of a purported sale or
transfer of the property, we still rule in favor of the holder of the Torrens Title if the
defendant cannot adduce, in addition to the deed of sale, a duly-registered
certificate of title proving the alleged transfer or sale.
A case in point is Umpoc v. Mercado57 in which we gave greater probative weight
to the plaintiffs TCT vis-a-vis the contested unregistered deed of sale of the
defendants. Unlike the defendants in Umpoc, however, the respondents did not
adduce a single evidence to refute the Spouses Supapo's TCT. With more reason
therefore that we uphold the indefeasibility and imprescriptibility of the Spouses
Supapo's title.
By respecting the imprescriptibility and indefeasibility of the Spouses Supapo's
TCT, this Court merely recognizes the value of the Torrens System in ensuring the
stability of real estate transactions and integrity of land registration.
We reiterate for the record the policy behind the Torrens System, viz.:
The Government has adopted the Torrens system due to its being the most
effective measure to guarantee the integrity of land titles and to protect their
indefeasibility once the claim of ownership is established and recognized. If a
person purchases a piece of land on the assurance that the seller's title thereto is
valid, he should not run the risk of being told later that his acquisition was
ineffectual after all, which will not only be unfair to him as the purchaser, but will
also erode public confidence in the system and will force land transactions to be
attended by complicated and not necessarily conclusive investigations and proof of
ownership. The further consequence will be that land conflicts can be even more
abrasive, if not even violent.58
With respect to the respondents' defense59 of laches, suffice it to say that the same
is evidentiary in nature and cannot be established by mere allegations in the
pleadings.60 In other words, the party alleging laches must adduce in court
evidence proving such allegation. This Court not being a trier of facts cannot rule
on this issue; especially so since the lower courts did not pass upon the same.
Thus, without solid evidentiary basis, laches cannot be a valid ground to deny the
Spouses Supapo's petition.61 On the contrary, the facts as culled from the records
show the clear intent of the Spouses Supapo to exercise their right over and
recover possession of the subject lot, viz.: (1) they brought the dispute to the
appropriate Lupon; (2) they initiated the criminal complaint for squatting; and (3)
finally, they filed the action publiciana. To our mind, these acts negate the
allegation of laches.
With these as premises, we cannot but rule that the Spouses Supapo's right to
recover possession of the subject lot is not barred by prescription.
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The action is not barred
by prior judgment
As a last-ditch effort to save their case, the respondents invoke res judicata. They
contend that the decision of the CA in CA-G.R. SP No. 78649 barred the filing of
the action publiciana.
To recall, CA-G.R. SP No. 78649 is the petition for certiorari filed by the
respondents to challenge the RTC's issuance of the writ enforcing their civil liability
(i.e., to vacate the subject property) arising from their conviction under the Anti-
Squatting Law. The CA granted the petition and permanently enjoined the
execution of the respondents' conviction because their criminal liability had been
extinguished by the repeal of the law under which they were tried and convicted. It
follows that their civil liability arising from the crime had also been erased.
The respondents' reliance on the principle of res judicata is misplaced.
Res judicata embraces two concepts: (1) bar by prior judgment as enunciated in
Rule 39, Section 47(b) of the Rules of Civil Procedure; and (2) conclusiveness of
judgment in Rule 39, Section 47(c).62
"Bar by prior judgment" means that when a right or fact had already been judicially
tried on the merits and determined by a court of competent jurisdiction, the final
judgment or order shall be conclusive upon the parties and those in privity with
them and constitutes an absolute bar to subsequent actions involving the same
claim, demand or cause of action.63
The requisites64 for res judicata under the concept of bar by prior judgment are:
(1) The former judgment or order must be final;
(2) It must be a judgment on the merits;
(3) It must have been rendered by a court having jurisdiction over the subject
matter and the parties; and
(4) There must be between the first and second actions, identity of parties,
subject matter, and cause of action.
Res judicata is not present in this case.
While requisites one to three may be present, it is obvious that the there is no
identity of subject matter, parties and causes of action between the criminal
case prosecuted under the Anti-Squatting Law and the civil action for the recovery
of the subject property.
First, there is no identity of parties. The criminal complaint, although initiated by
the Spouses Supapo, was prosecuted in the name of the people of the Philippines.
The accion publiciana, on the other hand, was filed by and in the name of the
Spouses Supapo.
Second, there is no identity of subject matter. The criminal case involves the
prosecution of a crime under the Anti-Squatting Law while the accion publiciana is
an action to recover possession of the subject property.
And third, there is no identity of causes of action. The people of the Philippines
filed the criminal case to protect and preserve governmental interests by
prosecuting persons who violated the statute. The Spouses Supapo filed
the accion publiciana to protect their proprietary interests over the subject property
and recover its possession.
Even casting aside the requirement of identity of causes of action, the defense
of res judicata has still no basis.
The concept of "conclusiveness of judgment" does not require that there is identity
of causes of action provided that there is identity of issue and identity of parties. 65
Under this particular concept of res judicata, any right, fact, or matter in issue
directly adjudicated or necessarily involved in the determination of an action before
a competent court in which judgment is rendered on the merits is conclusively
settled by the judgment therein and cannot again be litigated between the parties
and their privies, whether or not the claim, demand, purpose, or subject matter of
the two actions is the same.66
As already explained, there is no identity of parties between the criminal complaint
under the Anti-Squatting law and the civil action for accion publiciana. For this
reason alone, "collusiveness of judgment" does not apply.
Even if we assume, for the sake of argument, that there is identity of parties,
"conclusiveness of judgment" still does not apply because there is no identity of
issues. The issue in the criminal case is whether the respondents (accused
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therein) committed the crime alleged in the information, while the only issue
in accion publiciana is whether the Spouses Supapo have a better right than the
respondents to possess and occupy the subject property.
For all these reasons, the defense of res judicata is baseless.
Final Note
As a final note, we stress that our ruling in this case is limited only to the issue of
determining who between the parties has a better right to possession. This
adjudication is not a final and binding determination of the issue of ownership. As
such, this is not a bar for the parties or even third persons to file an action for the
determination of the issue of ownership.
WHEREFORE, premises considered, we GRANT the petition, and
consequently REVERSE and SET ASIDE the February 25, 2011 decision and
August 25, 2011 resolution of the Court of Appeals in CA-G.R. SP No. 111674.
SO ORDERED.
G.R. No. 195477
SPOUSES HERMINIO E. ERORITA and EDITHA C. ERORITA, Petitioners,
vs.
SPOUSES LIGAYA DUMLAO and ANTONIO DUMLAO, Respondents.
DECISION
BRION, J.:
We resolve the petition for review on certiorari filed by petitioners to challenge the
July 28, 2010 decision1 and January 4, 2011 resolution of the Court of
Appeals (CA) in CA-GR CV No. 92770. The CA affirmed the Regional Trial
Court's (RTC) decision ordering the petitioners to vacate the property.
THE ANTECEDENTS
Spouses Antonio and Ligaya Dumlao (Spouses Dumlao) are the registered owners
of a parcel of land located at Barangay San Mariano, Roxas, Oriental Mindoro, and
covered by TCT No. T-53000. The San Mariano Academy structures are built on
the property.
The Spouses Dumlao bought the property in an extrajudicial foreclosure sale on
April 25, 1990. Because the former owners, Spouses Herminio and Editha Erorita
(Spouses Erorita), failed to redeem it, the title was consolidated in the buyers’
name.
The Spouses Dumlao agreed to allow the petitioners to continue to operate the
school on the property. The Spouses Erorita appointed Hernan and Susan Erorita
as the San Mariano Academy’s administrators.
The Spouses Dumlao alleged that the Eroritas agreed on a monthly rent of Twenty
Thousand Pesos (P20,000.00), but had failed to pay rentals since 1990. The
Spouses Erorita countered that the Dumlaos allowed them to continue to run the
school without rental out of goodwill and friendship.
On December 16, 2002, the Spouses Dumlao asked the petitioners to vacate the
property. Although the Spouses Erorita wanted to comply, they could not
immediately close the school without clearance from the Department of Education,
Culture, and Sports to whom they are accountable.
On March 4, 2004, the Spouses Dumlao filed a complaint for recovery of
possession before the Regional Trial Court (RTC) against the defendants Hernan,
Susan, and the Spouses Erorita.2
In their joint answer, the defendants prayed that the complaint be dismissed
because they cannot be forced to vacate and to pay the rentals under their factual
circumstances.
After the issues were joined, the case was set for pre-trial. However, the
defendants-Eroritas failed to appear despite notice. Thus, the RTC declared them
in default and ordered the Spouses Dumlao to present evidence ex parte.
On June 4, 2007, the RTC decided in the Spouses Dumlao’s favor. It ordered the
defendants (1) to immediately vacate the property and turn it over to the Spouses
Dumlao, and (2) to pay accumulated rentals, damages, and attorney’s fees. The
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RTC also prohibited the defendants from accepting enrolees to the San Mariano
Academy.
The defendants Erorita appealed to the CA arguing that the complaint patently
shows a case for unlawful detainer. Thus, the RTC had no jurisdiction over the
subject matter of the case.
THE CA RULING
On appeal, the CA affirmed the RTC’s decision.
The CA ruled that the applicable law on jurisdiction when the complaint was filed,
was Republic Act No. 76913 (RA 7691). This law provides that in civil actions
involving a real property’s title or possession, jurisdiction depends on the
property’s assessed value and location – if the assessed value exceeds fifty
thousand pesos (P50,000.00) in Metro Manila, and twenty thousand pesos
(P20,000.00) outside of Metro Manila, the RTC has jurisdiction. If the assessed
value does not exceed these amounts, then, the Municipal Trial Court (MTC) has
jurisdiction.
Because the tax declaration showed that the assessed value of the property and
its improvements exceeded P20,000.00, the CA concluded that the RTC had
jurisdiction.
Citing Barbosa v. Hernandez,4 the CA held that this case involves an action for
possession of real property and not unlawful detainer.
The CA denied the petitioners’ motion for reconsideration; hence, this petition.
THE PARTIES’ ARGUMENTS
In their petition, the Spouses Erorita essentially argue that: (a) the RTC had no
jurisdiction because the allegations in the complaint show a case for unlawful
detainer; and (b) Hernan and Susan were improperly impleaded as parties to this
case.
In their comment, the respondents argue that: (a) the RTC had jurisdiction
because this case involves issues other than physical possession; (b) even
assuming the RTC initially had no jurisdiction, the petitioners’ active participation
during the proceedings bar them from attacking jurisdiction; (c) Hernan and Susan
are real parties in interest as the lease contract’s primary beneficiaries; and (d) this
last issue cannot be raised for the first time on appeal.
ISSUES
Based on the parties’ positions, the issues for our resolution are:
I. Whether the RTC had jurisdiction; and
II. Whether Hernan and Susan were improperly impleaded.
OUR RULING
The petition is partly meritorious.
We hold that: (1) the MTC had jurisdiction; and (2) the second issue was not raised
before the lower courts; thus, it cannot be considered in the present case.
Jurisdiction is based on the allegations in the complaint.
On the first issue, the allegations in the complaint determine the nature of an
action and jurisdiction over the case.5Jurisdiction does not depend on the
complaint’s caption.6 Nor is jurisdiction changed by the defenses in the answer;
otherwise, the defendant may easily delay a case by raising other issues, then,
claim lack of jurisdiction.7
To make a case for unlawful detainer, the complaint must allege that: (a) initially,
the defendant lawfully possessed the property, either by contract or by
plaintiff’s tolerance; (b) the plaintiff notified the defendant that his right of
possession is terminated; (c) the defendant remained in possession and
deprived plaintiff of its enjoyment; and (d) the plaintiff filed a complaint within one
year from the last demand on defendant to vacate the property.8 A complaint
for accion publiciana or recovery of possession of real property will not be
considered as an action for unlawful detainer if any of these special jurisdictional
facts is omitted.9
A review of the complaint shows that: (a) the owners, Spouses Dumlao, agreed to
allow the petitioners to continue operating the school on the disputed property; (b)
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in a demand letter dated February 12, 2004, the Spouses Dumlao told the
petitioners to pay and/or vacate the property; (c) the respondents refused to vacate
the property; and (d) the Spouses Dumlao filed the complaint (March 4, 2004)
within a year from the last demand to vacate (February 12, 2004).
Thus, although the complaint bears the caption "recovery of possession," its
allegations contain the jurisdictional facts for an unlawful detainer case. Under RA
7691, an action for unlawful detainer is within the MTC’s exclusive jurisdiction
regardless of the property’s assessed value.10
The CA incorrectly applied our ruling in Barbosa. In that case, the complaint did
not state that (i) possession was unlawfully withheld and (ii) the complaint was filed
within a year from the last demand. Because these special jurisdictional facts for
an unlawful detainer case were lacking, we held that the case should be accion
publiciana over which the RTC has jurisdiction
In the present case, however, the complaint clearly contained the elements of an
unlawful detainer case. Thus, the case should have been filed with the MTC. The
RTC had no jurisdiction over this case.
Since a decision rendered by a court without jurisdiction is void, 11 the RTC’s
decision is void.
Jurisdiction over the subject matter may be raised at any time.
With the jurisdictional issue resolved, we now examine whether the petitioners
timely raised this issue.
As a general rule, lack of jurisdiction over the subject matter may be raised at any
time, or even for the first time on appeal.12 An exception to this rule is the principle
of estoppel by laches.13
Estoppel by laches may only be invoked to bar the defense of lack of jurisdiction if
the factual milieu is analogous to Tijam v. Sibonghanoy.14 In that case, lack of
jurisdiction was raised for the first time after almost fifteen (15) years after the
questioned ruling had been rendered and after the movant actively participated in
several stages of the proceedings. It was only invoked, too, after the CA rendered
a decision adverse to the movant.
In Figueroa v. People,15 we ruled that the failure to assail jurisdiction during trial is
not sufficient for estoppel by laches to apply. When lack of jurisdiction is raised
before the appellate court, no considerable length of time had elapsed for laches to
apply.16 Laches refers to the "negligence or omission to assert a right within a
reasonable length of time, warranting a presumption that the party entitled to
assert it either has abandoned it or declined to assert it."17
The factual setting of this present case is not similar to Tijam so as to trigger the
application of the estoppel by laches doctrine.1âwphi1 As in Figueroa, the present
petitioners assailed the RTC’s jurisdiction in their appeal before the CA. Asserting
lack of jurisdiction on appeal before the CA does not constitute laches.
Furthermore, the filing of an answer and the failure to attend the pre-trial do not
constitute the active participation in judicial proceedings contemplated in Tijam.
Thus, the general rule should apply.1âwphi1 The petitioners timely questioned the
RTC's jurisdiction.
Issue not raised before the lower court
On the second issue, it is settled that issues that have not been raised before the
lower courts cannot be raised for the first time on appeal.18 Basic consideration of
due process dictates this rule.19
We note that the second issue raised by the petitioners were not raised before the
lower courts. The petitioners only raised this issue in their petition before this
Court. Thus, we need not discuss this issue at our level.
WHEREFORE, we hereby GRANT the petition. The July 28, 2010 decision and
January 4, 2011 resolution of the Court of Appeals in CA-GR CV No. 92770 are
hereby REVERSED and SET ASIDE. Accordingly, we DECLARE the June 4,
2007 decision of the RTC in Civil Case No. C-492 void for lack of jurisdiction.
SO ORDERED.
G.R. No. 197743, March 12, 2018
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 HEIRS OF JOSE MARIANO AND HELEN S. MARIANO, REPRESENTED BY
DANILO DAVID S. MARIANO, MARY THERESE IRENE S. MARIANO, MA.
CATALINA SOPHIA S. MARIANO, JOSE MARIO S. MARIANO, MA. LENOR S.
MARIANO, MACARIO S. MARIANO AND HEIRS OF ERLINDA MARIANO-
VILLANUEVA, REPRESENTED IN THIS ACT BY IRENE LOURDES M.
VILLANUEVA THROUGH HER ATTORNEY-IN-FACT EDITHA S. SANTUYO
AND BENJAMIN B. SANTUYO,Petitioners, v. CITY OF NAGA, Respondent.
DECISION
TIJAM, J.:
This is a Petition for Review on Certiorari, filed under Rule 45 of the Rules of
Court, assailing the July 20, 2011 Amended Decision1 rendered by the Court of
Appeals (CA) in CA-G.R. SP No. 90547 which reconsidered its March 7, 2011
Decision,2 annulling the June 20, 2005 Decision3 of the Regional Trial Court
(RTC), Branch 26 of Naga City in Civil Case No. RTC 2005-0030, and reinstating
the February 14, 2005 Decision4 of the Municipal Trial Court (MTC), Branch 1 of
Naga City in Civil Case No. 12334 dismissing the ejectment case instituted by
petitioners.
The Facts
As culled by the CA from the records, the facts of the case are as follows:
On July 3, 1954, Eusebio M. Lopez, Sr., Soledad L. Dolor, Jose A. Gimenez and
Eusebio Lopez, Jr. (Lopez Jr.), as the President, Secretary, Treasurer and General
Manager of the City Heights Subdivision (Subdivision), respectively, wrote to the
mayor of the City of Naga (City), offering to construct the Naga City Hall within the
premises of the Subdivision. Their letter indicated that the City Hall would be built
on an area of not less than two hectares within the Subdivision, which would be
designated as the open space reserved for a public purpose. The letter, which also
indicated the terms of the construction contract, provided that the City would be
free to accept another party's offer to construct the City Hall if it found the same to
be more favorable.5
The City's Municipal Board subsequently passed Resolution No. 75, dated July 12,
1954, asking the Subdivision for a bigger area on which the City Hall would stand.
Consequently, on July 30, 1954, the Subdivision amended its offer and agreed to
donate five hectares to the City. The area is a portion of the land registered in the
names of Macario Mariano (Macario) and Jose A. Gimenez (Gimenez) under
Transfer Certificate of Title (TCT) No. 671 of the Registry of Deeds for Naga City,
measuring a total of 22.9301 hectares. Along with its amended offer to construct
the City Hall, the Subdivision specified the terms of its proposal to finance the
construction.6
The amended offer was signed by Macario and Gimenez to indicate their
"(c)onforme," and by their respective spouses, Irene P. Mariano (Irene) and Rose
Fitzgerald De Gimenez (through one Josie A. Gimenez), to indicate their marital
consent.7
On August 11, 1954, the Municipal Board adopted Resolution No. 89 accepting the
Subdivision's offer of donation and its proposed contract. The Resolution also
authorized the City Mayor to execute the deed of donation on the City's behalf. 8
The parties submitted divergent accounts on what happened after Resolution No.
89 was passed.
According to the City, the City Mayor of Naga, Monico Imperial (Mayor Imperial),
and the registered landowners, Macario and Gimenez, executed a Deed of
Donation9 on August 16, 1954, whereby the latter donated five hectares of land
(subject property), two hectares of which to be. used as the City Hall site, another
two hectares for the public plaza, and the remaining hectare for the public market.
By virtue of said Deed, the City entered the property and began construction of the
government center. It also declared the five-hectare property in its name for tax
purposes.10 Thereafter, the Land Transportation Office (LTO), the National Bureau
of Investigation (NBI), the Department of Labor and Employment (DOLE), the
Philippine Postal Corporation (PPC), the Fire Department and other government
agencies and instrumentalities entered the same property and built their offices
thereon.11
In contrast, petitioners averred that the landowners' plan to donate five hectares to
the City did not materialize as the contract to build the City Hall was not awarded
to the Subdivision. As early as August 23, 1954, Lopez Jr., the Subdivision's
General Manager, supposedly wrote to Macario telling him to suspend the signing
of the deed of donation as the Municipal Board could not agree on the specific site
where the City Hall would be built. Petitioners alleged that the construction contract
was eventually awarded by the Bureau of Public Works (BPW) to a local
contractor, Francisco O. Sabaria (Sabaria), who won in a public bidding. Mayor
Imperial opposed the award, arguing that he and not the BPW had the authority to
initiate the public bidding for the project. The BPW, however, asserted its authority
to bid out and award the contract on the ground that national funds would be used
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for the project. Mayor Imperial and Sabaria litigated the issue, with the former
losing before the trial court and subsequently withdrawing his appeal before the
CA. Afterwards, the Municipal Board adopted Resolution No. 11 dated January 20,
1959 authorizing the City Mayor to enter into a contract with Sabaria for the
construction of the City Hall.12
Petitioners claimed that on February 5, 1959, Macario and officers of the
Subdivision met with Mayor Imperial to demand the return of the five-hectare lot as
the condition for the donation was not complied with. Mayor Imperial purportedly
assured them that the City would buy the property from them. The purchase,
however, did not materialize. Petitioners alleged that ten years later, or on May 14,
1968, Macario wrote to Lopez Jr., instructing him to make a follow-up on the City's
payment for the subject lot. On December 2, 1971, Macario died without receiving
payment from the City.13
In 1976, a certain Tirso Mariano filed an action for partition of Macario's estate.
The action was opposed by Macario's widow, Irene, and their adopted children,
Jose (Jose) and Erlinda (Erlinda) Mariano. As an offshoot of this action, a petition
to annul Jose and Erlinda's adoption was instituted.14
Irene died in 1988. Jose died the following year which was also when his and
Erlinda's adoption was declared valid and legal by the appellate court. In 1994,
Irene's marriage to one Rolando Reluccio (Reluccio) was declared bigamous and
void ab initio. And after a protracted litigation, Jose, then represented by his heirs,
and Erlinda were declared as Irene's heirs to the exclusion of Reluccio who was
also declared to be without right to represent Irene in Macario's estate.15
On March 11, 1997, the probate court issued letters of administration to one of the
petitioners herein, Danilo David S. Mariano (Danilo), for the administration of
Irene's estate. In September 2003, Danilo demanded upon then City Mayor of
Naga, Jesse M. Robredo, to vacate and return the subject property. When the City
did not comply, petitioners, as heirs of Jose and Erlinda, filed a Complaint 16 for
unlawful detainer against the City, docketed as Civil Case No. 12334. 17
The Unlawful Detainer Case
In their Complaint, filed on February 12, 2004,18 petitioners asked the MTC to
order the City and all agencies, instrumentalities or offices claiming rights under it,
including the LTO, NBI, DOLE, PPC and the Fire. Department, to vacate the
subject property, shown in the Sketch Plan as Blocks 25 and 26 (LRC) Psd-9674,
and to return possession thereof to them. In addition to attorney's fees, they asked
the City to pay them a monthly rental of P2.5 million from the date it received the
demand to vacate until it surrendered possession, as reasonable compensation for
the use of the property.19
Arguing that the issue involved is one of ownership, the City moved to dismiss the
complaint for lack of jurisdiction.20 After the MTC denied the motion on March 22,
2004,21 the City filed its Answer.22 The parties subsequently submitted their
respective Position Papers23 and evidence.24
Petitioners averred that there was no donation of the subject property to the City
as the obligation to donate on the part of Macario and Gimenez, conditioned on the
Subdivision undertaking the construction of the City Hall therein, was abrogated
when the City eventually awarded the construction contract to Sabaria. Petitioners
further alleged that Macario thereafter demanded the return of the property but
was assured by Mayor Imperial that the City would buy the same. The purchase,
however, never materialized despite Macario's supposed reminder to Mayor
Imperial of his assurance. Petitioners, thus, argued that the City's possession of
the subject property was by mere tolerance which ceased when they required its
return.25
The City countered that the donation actually took place, as evidenced by a Deed
of Donation dated August 16, 1954, making the City the owner and lawful
possessor of the subject property. This was supposedly why the subject property
had long been declared in the City's name for tax purposes. Granting there was no
donation, the City stressed that ownership of the premises automatically vested in
it when they were designated as open spaces of the subdivision-project, donation
thereof being a mere formality. The City also argued that since the property was
already occupied by several government offices for about 50 years, recovery
thereof was no longer feasible and the landowners may simply demand just
compensation from the City. The City further contended that the complaint was
dismissible on the grounds of laches and prescription. In any case, the City
averred that it could not be ejected from the premises as it possessed the rights of
a builder in good faith.26
Petitioners in turn denied that laches had set in because Macario supposedly
made a demand for the City to return the property, and subsequently, to abide by
Mayor Imperial's commitment to purchase the same. Furthermore, as heirs of
Macario and Irene, they themselves sought to recover the subject property after
learning of their rights thereto through Danilo who collated Irene's properties
following his appointment as administrator of her estate.27
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Petitioners also argued that title to the property, which remained registered in the
names of Macario and Gimenez, was indefeasible and could not be lost by
prescription or be defeated by tax declarations. They further asserted that the
requirement of open space in the subdivision for public use was already satisfied
with the landowners' donation of road lots, measuring 120,280 square meters, to
the City as annotated on TCT No. 671. They posited that Presidential Decree (PD)
No. 95728, enacted in 1976, as amended by PD No. 121629, which defined "open
space," should not be applied because it was not yet in effect when the subdivision
plan was approved in 1962.30
Petitioners contended that the City was a builder in bad faith because it continued
to construct the City Hall and allowed other government agencies to build their
offices on the subject property, knowing that the donation had been aborted when
the condition therefor was not fulfilled and that its avowed purchase of the property
was not forthcoming.31
The MTC's Ruling
In its February 15, 2005 Decision, the MTC gave weight to the Deed of
Donation.32 Nonetheless, it dismissed the complaint on the ground of lack of
jurisdiction. It reasoned that the City's defense, which involved a claim of
ownership, removed the issue from the case of unlawful detainer.33
The RTC's Ruling
On the City's appeal, the RTC set aside the MTC's dismissal. The dispositive
portion of the RTC's June 20, 2005 Decision reads as follows:
WHEREFORE, premises considered [petitioners] having proved and convinced
this Court by preponderance of evidence that the lower court committed a serious
and reversible error in rendering the herein assailed decision, accordingly, the
DECISION dated February 14, 2005 of the Court a quo is hereby REVERSED and
SET ASIDE. Consequently, decision is hereby rendered in favor of [petitioners]
and against [respondent] ORDERING the latter of the following:
(1) For the [respondent] City Government of Naga, including all other government
instrumentalities, agencies and offices claiming right of possession through and
under it which are but not limited to Land Transportation Office, National Bureau of
Investigation, Department of Labor and Employment, Philippine Postal
Corporation, Fire Department and all other offices and buildings which are all
claiming rights under [respondent] to immediately vacate the subject properties,
Blocks 25 and 26 (LRC) Psd-9674 forming part of TCT No. 671 in the name of
Macario A. Mariano and Jose A. Gimenez, and to peacefully surrender and deliver
its physical possession to the [petitioners], including all the improvements and
structures erected thereon which were built in bad faith as they are now forfeited in
favor of plaintiffs-appellants;
(2) For the [respondent] to pay [petitioners] the amount of P2,500,000.00 per
month by way of reasonable compensation for the use and occupancy of the
property in question reckoned from November 30, 2003 until such time that the
[respondent] shall have actually vacated the subject property;
(3) For the [respondent] to pay [petitioners] Attorney's fees in the amount of
P587,159.60; and
(4) For the [respondent] to pay the cost of the suit.
SO ORDERED.34
The RTC held that the MTC could have resolved the issue of ownership if only to
resolve the issue of possession. It ruled against the existence of the Deed of
Donation, purportedly acknowledged before a notary public for Manila, finding that
the award of the construction contract to Sabaria released Macario and Gimenez
from the obligation to execute said deed. Furthermore, the fact that the subject
property remained registered in Macario and Gimenez's names and no annotation
of the purported donation was ever inscribed on the title proved that the City
recognized that its possession was by mere tolerance of the landowners. This
finding, said the RTC, was bolstered by the Certification35 issued on August 27,
2003 by the Records Management Archive Office of the National Archives that it
had no record of such Deed, and a similar Certification36 from the Office of the
Clerk of Court of the Manila RTC as repository of notarial reports of notaries public
for Manila. The RTC also noted that the purported Deed of Donation was unsigned
by the donors and indicated merely the letters "SGD" opposite their names. 37
The RTC explained that since the subject land was titled under the Torrens system
in the name of Macario and Gimenez, the tax declaration in the City's name could
not prevail, and the property could not be subject of acquisitive prescription. It also
held that petitioners were not guilty of laches, noting the several cases they had to
file to establish their right to inherit from, and to recover or preserve the estate of,
Macario and Irene, as well as Danilo's discovery of the subject property as part of
the latter's estate following the issuance to him of letters of administration over
Irene's estate in 1997. Finally, the RTC agreed with petitioners that the road lots
donated to the City in 1963 satisfied the requirement of open space in the
subdivision at that time, and that the City was a builder in bad faith. 38
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The City moved for the Presiding Judge's inhibition on the ground of bias.
Subsequently, it also filed a motion for reconsideration of the June 20, 2005
Decision with a motion for new trial based on newly discovered
evidence39 consisting of additional documents purportedly showing that the subject
property was already donated to the City.40 On July 15, 2005, the RTC issued an
Order denying said motions.41
The CA's March 7, 2011 Decision
Partly granting the City's appeal, the CA inter alia directed the City to pay only half
of the monthly rental, which it reduced to P500,000, because the subject property
was co-owned by Macario and Gimenez. The dispositive portion of the CA's
Decision reads:
IN VIEW OF ALL THE FOREGOING, the instant petition for review is PARTIALLY
GRANTED.
The assailed Decision dated June 20, 2005 rendered by the Regional Trial Court
(RTC) of Naga City (Branch 26), in Civil Case No. RTC 2005-0030 (For:
Ejectment) is hereby MODIFIED in that:
(1) The City of Naga is hereby ORDERED to pay to the respondents as heirs of
Don Macario Mariano half of the adjudged monthly rental for the use and
enjoyment of the questioned property, or in the amount of Two Hundred Fifty
Thousand Pesos (Php250,000.00), for the period November 3, 2003 until the City
of Naga finally vacates that portion it has been occupying, or until such time when
the City expropriates the same private property;
(2) The portion of the assailed Decision where all the other government
instrumentalities and agencies, including but not limited to the Land Transportation
Office, National Bureau of Investigation, Department of Labor and Employment,
Philippine Postal Corporation, Fire Department, Municipal Trial Court, Regional
Trial Court, which office buildings are standing on the lot in question, are ordered
to immediately vacate therefrom as well as to deliver the physical possession of
the improvements and structures they have introduced thereat to the Heirs of Don
Macario Mariano, is DELETED because these other government instrumentalities
and agencies are not parties to the case in the court below; and
(3) The award of attorney's fees in favor of the Heirs of Don Macario Mariano is
reduced to Two Hundred Thousand Pesos (Php200,000.00) on equitable grounds.
All other aspects of the assailed Decision dated June 20, 2005 and Order dated
July 15, 2005 are hereby affirmed.
SO ORDERED.42
In reaching this decision, the CA ratiocinated that:
[T]here could be no donation of the subject five (5) hectares of land by the
landowners, DON MACARIO and Jose Gimenez (or GIMENEZ) to the City of Naga
because the donee failed to present the original deed of donation before the trial
court, and did not give a satisfactory explanation of the loss of the same. As
against the Letter dated May 14, 1968 written by DON MACARIO instructing
Eusebio Lopez, Sr., then City Heights Subdivision President, to do a follow-up of
the City's proposal to buy the five (5) hectare-lot, We held the latter document to
be a conclusive proof that the donation that DON MACARIO and the City of Naga
intended was not consummated.43
The CA's July 20, 2011 Amended Decision
Both parties moved for reconsideration of the CA's March 7, 2011 Decision.44 After
a re-examination of the case records and the evidence adduced by the parties, the
CA, on My 20, 2011, rendered an Amended Decision, the dispositive portion of
which reads:
WHEREFORE, premises considered, the Motion for Reconsideration filed by the
City of Naga is GRANTED.
Our Decision promulgated on March 7, 2011 is RECONSIDERED. Accordingly, the
Decision dated June 20, 2005 of the Regional Trial Court (RTC) of Naga City
(Branch 26), in Civil Case No. RTC 2005-0030 {For: Ejectment),
is ANNULLED and SET ASIDE, and the Decision dated February 14, 2005
rendered by the Municipal Trial Court (MTC) of Naga City (Branch 1), in Civil Case
No. 12334, is hereby REINSTATED without prejudice to the filing by either party of
an action regarding the ownership of the property involved.
On the other hand, the Motion for Reconsideration filed by the Heirs of Don
Macario Mariano of Our Decision dated March 7, 2011 is DENIED.
SO ORDERED.45
In so ruling, the CA held that pursuant to the best evidence rule under Section 3,
Rule 130 of the Rules of Court, the photocopy of the letter dated May 14, 1968
was inadmissible and without probative value in the absence of a clear showing
that the original writing was lost or destroyed. As an exception to the best evidence
rule, the CA excused the City's failure to present the original Deed of Donation on
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the basis of the June 11, 2004 Certification issued by the Office of the Clerk of Presiding Officer, indicating the existence of a Deed of Donation and the fact of
Court of the RTC-Manila that the Deed could not be found in its records as the Donation (Exhibit "6").46
Notarial Reports of Atty. Vicente M. Magpoc, before whom the instrument was The CA thus concluded that the existence and due execution of the Deed of
acknowledged, for the period January 12, 1953 to December 31, 1954, could not
Donation had been duly established, warranting the dismissal of the ejectment
be located and must have been destroyed by water spillage during the fire that
case. The CA also found that petitioners' claim was barred by laches, noting that
razed, their office on November 18, 1981. According to the CA, secondary
the City had been in open, public and adverse possession of the subject property
evidence of the Deed could be admitted because it had been satisfactorily shown,
for 49 years at the time the ejectment case was filed.
through the Certification, that the Deed was lost due to force majeure, thus, without
bad faith on the part of the offeror. The appellate court, however, emphasized that the case being one for unlawful
detainer, its judgment was conclusive only as to possession, and its disquisition on
The CA further held that "the following secondary documents on record sufficiently
the claim of ownership was merely provisional and without prejudice to a separate
confirmed the existence, execution and contents of the subject deed of donation,"
and independent action respecting title to the land.
to wit:
(a) Letter dated July 3, 1954 of the President, Secretary, Treasurer and General Dissatisfied with the CA's Amended Decision, petitioners filed the instant petition
Manager of the City Heights Subdivision (in the persons of Eusebio M. Lopez, Sr., for review.
Soledad L. Dolor, Jose A. Gimenez and Eusebio Lopez, Jr.) to the mayor of Naga
expressing their offer to construct the Naga City Hall within the premises of not
Petitioners pray for the reinstatement of the RTC's Decision, asserting that in
less than two (2) hectares of the Subdivision (Exhibit "1");
admitting secondary evidence of the Deed of Donation, the CA misapplied Section
5, Rule 130 and Section 19, Rule 132 of the Rules, Article 749 of the Civil Code,
(b) Resolution No. 75 dated July 12, 1954 issued by the Municipal Board of Naga and Sections 245, 246 and 247 of the Notarial Law. Petitioners fault the CA for
(then a municipality) requesting for a bigger area of land where the City Hall would allegedly disregarding their evidence which received no objection from the City.
stand, from the Subdivision (Exhibit "2");
Finally, petitioners impugn the CA's finding that they were guilty of laches, insisting
that the City's possession was by mere tolerance.47
(c) Letter dated July 30, 1954 of the Subdivision to the City amending its original
offer and agreeing to donate a portion of five (5) hectares. Also, in this Letter, the
The Court's Ruling
Subdivision elaborated on its offer to finance the construction of the same building
and specified the terms of such financing contract (Exhibit "3");
Petitions for review under Rule 45 should cover only questions of law 48 as this
Court is not a trier of facts.49 However, the incongruent factual conclusions of the
(d) Resolution No. 89 dated August 11, 1954 where the then Municipal Board
MTC and the CA on the one hand, and the RTC on the other, compel us to revisit
resolved to accept the Subdivision's offer of donation and of the financing contract
the factual circumstances of the case for the proper dispensation of justice. 50
to construct the government center, and at the same time, to authorize the Mayor
to enter into a final deed of donation in behalf of the then municipality (Exhibit "4");
The sole issue for resolution in an unlawful detainer case is physical or material
possession of the property involved, independent of any claim of ownership by any
(e) Letter dated November 26, 1955 of the then City Mayor of Naga, Hon. Monico
of the parties - possession de facto and not possession de jure.51 When the
Imperial, to the Naga City Planning Board indicating the fact of donation of the
defendant, however, raises the defense of ownership in his pleadings and the
same parcel of land by the Subdivision to the City (Exhibit "30");
question of possession cannot be resolved without deciding the issue of
ownership, the issue of ownership shall be resolved only to determine the issue of
(f) Letter dated March 6, 1968 of DON MACARIO referring to the open spaces of
possession,52 or more particularly, to determine who between the parties has the
the Subdivision having been donated to the City of Naga (Exhibit "18");
better right to possess the property.53 Nonetheless, the adjudication is merely
provisional and would not bar or prejudice an action between the same parties
(g) Letter dated September 6, 1970 of Hon. Virginia F. Perez, Vice-Mayor and
involving title to the property.54
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In this case, the City, as the defendant in the unlawful detainer case, asserted
ownership over the subject property by virtue of an alleged donation made in 1954
by the landowners in its favor. In support of this claim, the City proffered a copy of
a Deed of Donation dated August 16, 1954.
Purported donation lacked the formalities required for validity
Generally, contracts are obligatory in whatever form they may have been entered
into, provided all the essential requisites for their validity are present. However,
when the law requires that a contract be in some form to be valid, such
requirement is absolute and indispensable; its non-observance renders the
contract void and of no effect.55 One such law is Article 749 of the Civil Code of the
Philippines which requires that:
Art. 749. In order that the donation of an immovable may be valid, it must be
made in a public document, specifying therein the property donated and the
value of the charges which the donee must satisfy.
The acceptance may be made in the same deed of donation or in a separate
public document, but it shall not take effect unless it is done during the lifetime of
the donor.
If the acceptance is made in a separate instrument, the donor shall be notified
thereof in an authentic form, and this step shall be noted in both instruments.
(Emphasis ours)
Thus, donation of real property, which is a solemn contract, is void without the
formalities specified in the foregoing provision.56
Article 749 of the Civil Code requires that donation of real property must be made
in a public instrument to be valid. In Department of Education, Culture and Sports
(DECS) v. Del Rosario,57 We stated:
A deed of donation acknowledged before a notary public is a public
document. The notary public shall certify that he knows the person
acknowledging the instrument and that such person is the same person who
executed the instrument, acknowledging that the instrument is his free act
and deed. The acceptance may be made in the same deed of donation or in a
separate instrument. An acceptance made in a separate instrument must also be
in a public document. If the acceptance is in a separate public instrument, the
donor shall be notified in writing of such fact. Both instruments must state the fact
of such notification.58 (Emphasis ours)
The purported Deed of Donation submitted by the City cannot be considered a
public document. While it contains an Acknowledgment before a notary public, the
same is manifestly defective as it was made neither by the alleged donors
(Macario and Gimenez) and their respective spouses, or by the donee (the City,
through Mayor Imperial), but only by Eusebio M.Lopez, Faustino Dolor, Soledad
Lirio Dolor and Lopez, Jr., as the Subdivision's President, Vice President,
Secretary and General Manager, respectively. The Acknowledgment thus reads:
REPUBLIC OF THE PHILIPPINES)
IN THE CITY OF MANILA ) s.s.
x--------------------------------------------x
BEFORE ME, this 16th day of August, 1954, in the City of Manila, Philippines,
personally appeared EUSEBIO M. LOPEZ, with Res. Cert. No. A-0232064, issued
at Manila, on Feb. 24, 1954; FAUSTINO DOLOR, with Res. Cert. No. A-0295133,
issued at Manila on Feb. 7, 1954; SOLEDAD LIRIO DOLOR, with Res. Cert. No.
A-4782271, issued at Pasay City on July 27, 1954; and EUSEBIO LOPEZ, JR.,
with Res. Cert. No. A-476353, issued at Naga City on July 8, 1954, all known to
me and to me known to be the same persons who executed the foregoing
instrument and they acknowledged to me that the same is their free act and
voluntary deed.
This instrument relating to a Deed of Donation consist two pages only, including
this page on which this acknowledgement is written and have been signed by the
parties on each and every page thereof.
WITNESS MY HAND AND SEAL, the day, year, and place first above written.
Doc. No. 201; Page No. 70; (SGD) VICENTE M. MAGPOC
Book No. VI; Series of 1954 Notary Public
Until December 31, 195458
(Emphasis ours)
Said Deed also shows that Mayor Imperial affixed his signature thereon on August
21, 1954, or four days after it was notarized, thus he could not have acknowledged
the same before the notary public on August 16, 1954. Verily, the notary public
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could not have certified to knowing the parties to the donation, or to their execution
of the instrument, or to the voluntariness of their act. This glaring defect is fatal to
the validity of the alleged donation. It is settled that a defective notarization will
strip the document of its public character and reduce it to a private instrument. 59
Not being a public document, the purported Deed of Donation is void.60 A void or
inexistent contract has no force and effect from the very beginning,61 as if it had
never been entered into.62 It is equivalent to nothing and is absolutely wanting in
civil effects. It cannot be validated either by ratification or prescription. 63
Void contracts may not be invoked as a valid action or defense in any court
proceeding, including an ejectment suit.64 Thus:
In Spouses Alcantara v. Nido, which involves an action for unlawful detainer, the
petitioners therein raised a defense that the subject land was already sold to them
by the agent of the owner. The Court rejected their defense and held that the
contract of sale was void because the agent did not have the written authority of
the owner to sell the subject land.
Similarly, in Roberts v. Papio, a case of unlawful detainer, the Court declared that
the defense of ownership by the respondent therein was untenable. The contract
of sale invoked by the latter was void because the agent did not have the written
authority of the owner. A void contract produces no effect either against or in favor
of anyone.
In Ballesteros v. Abion, which also involves an action for unlawful detainer, the
Court disallowed the defense of ownership of the respondent therein because the
seller in their contract of sale was not the owner of the subject property. For
lacking an object, the said contract of sale was void ab initio.65
Since void contracts cannot be the source of rights, the City has no possessory
right over the subject property.66 In this light, to resolve whether to admit the copy
of the purported Deed of Donation as secondary evidence will be futile as the
instrument in any case produces no legal effect.
Circumstances controverting the City's right of possession based on the
alleged donation
Other cogent facts and circumstances of substance engender veritable doubts as
to whether the City has a better right of possession over the subject property than
petitioners, as heirs of Mariano and Irene, based on the purported Deed of
Donation.67
The City has, for more than 50 years since the donation supposedly took place on
August 16, 1954, failed to secure title over the subject property in its name. If the
City had acquired ownership of the premises, it is incredible that it would fail to
register the donation and have the property titled in its name. That it would remain
passive for such length of time is confounding and does not serve to bolster its
proprietary or possessory claim to the property. 68
At the very least, the City should have caused the annotation of the alleged Deed
on TCT No. 671 immediately after August 16, 1954 or shortly thereafter. Such
inscription would have been binding on petitioners, as Macario and Irene's
successors-in-interest, as well as on third parties.69
Petitioners, as heirs of a registered owner of the subject property, have the
preferred or better right of possession
Indeed, title to the subject property remains registered in the names of Macario
and Gimenez. The alleged Deed of Donation does not appear to have been
registered and TCT No. 671 does not bear any inscription of said Deed.
The Court has consistently upheld the registered owners' superior right to possess
the property in unlawful detainer cases.70 A fundamental principle in land
registration is that the certificate of title serves as evidence of an indefeasible and
incontrovertible title to the property in favor of the. person whose name appears
therein. It is conclusive evidence as regards ownership of the land therein
described, and the titleholder is entitled to all the attributes of ownership of the
property, including possession.71 Thus, the Court has time and again reiterated the
age-old rule that the person who has a Torrens title over a parcel of land is entitled
to possession thereof.72
It has likewise been constantly emphasized that when the property is registered
under the Torrens system, the registered owner's title to the property is presumed
legal and cannot be collaterally attacked, especially in a mere action for unlawful
detainer.73 It has even been held that it does not even matter if the party's title to
the property is questionable.74
Furthermore, it has been held that a certificate of title has a superior probative
value as against that of an unregistered deed of conveyance in ejectment
cases.75Spouses Pascual v. Spouses Coronel,76involving an unlawful detainer
case, is on point; it instructs:
In any case, [W]e sustain the appellate court's finding that the respondents have
the better right to possess the subject property. As opposed to the unregistered
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deeds of sale, the certificate of title certainly deserves more probative value.
Indeed, a Torrens Certificate is evidence of indefeasible title of property in favor of
the person in whose name appears therein—such holder is entitled to the
possession of the property until his title is nullified.
xxxx
Even if [W]e sustain the petitioners' arguments and rule that the deeds of sale are
valid contracts, it would still not bolster the petitioners' case. In a number of cases,
the Court had upheld the registered owners' superior right to possess the property.
In Co v. Militar, the Court was confronted with a similar issue of which between the
certificate of title and an unregistered deed of sale should be given more probative
weight in resolving the issue of who has the better right to possess. There, the
Court held that the court a quo correctly relied on the transfer certificate of title in
the name of petitioner, as opposed to the unregistered deeds of sale of the
respondents. The Court stressed therein that the Torrens System was adopted in
this country because it was believed to be the most effective measure to guarantee
the integrity of land titles and to protect their indefeasibility once the claim of
ownership is established and recognized.
Likewise, in the recent case of Umpoc v. Mercado, the Court declared that the trial
court did not err in giving more probative weight to the TCT in the name of
the decedent vis-a-vis the contested unregistered Deed of Sale. Later
in Arambulo v. Gungab, the Court held that the registered owner is preferred to
possess the property subject of the unlawful detainer case. The age-old rule
is that the person who has a Torrens Title over a land is entitled to possession
thereof.78 (Emphasis ours and citations omitted.)
Accordingly, as against the City's unregistered claim, the Torrens title in the name
of Macario and Gimenez must prevail, conferring upon the registered owners the
better right of possession. This superior or preferred right of possession applies to
petitioners as Macario's hereditary successors79 who have stepped into said
decedent's shoes by operation of law.80
No automatic acquisition of ownership of open space in the subdivision
On the strength of the Court's ruling in White Plains Association, Inc. v. Judge
Legaspi,81 the City asserted that because the subject property had been
designated as the open space of the City Heights Subdivision, intended for public
use, ownership thereof automatically vested in the City, its donation being a mere
formality. It disputed petitioners' claim that the road lots already donated to the City
satisfied the open space requirement for subdivisions prior to the enactment of PD
957 dated July 12, 1976, as amended by PD 1216 dated October 14, 1977. It
argued that the Subdivision Regulations then in effect expressly required a public
open space of at least five percent (5%) of the gross area of the subdivision.
Several reasons impel us to reject the City's stance.
We start with the 1948 Subdivision Regulations81 invoked by the City. As
amended,82 it required:
Sec. 14. Areas for Community Use.
a. Public open space
Subdivisions of one hectare or more shall be provided with suitable areas for
parks, playgrounds, playlots and/or other recreational purposes to be
dedicated for public use which area or areas shall comprise at least 5 per cent of
the gross area of the subdivision. Open spaces so dedicated for public use shall
be consolidated as much as possible for maximum utility and not broken into small
or odd-shaped parcels of land.83(Emphasis ours)
The Subdivision Regulations required a public open space in the subdivision,
suitable for parks, playgrounds, playlots and/or other recreational purposes. The
term "open space" necessarily signifies the absence of buildings or edifices. The
enumeration of parks, playgrounds and playlots as the specified usage for such
space buttresses the view that the area should be non-buildable. The phrase
"other recreational purposes" should be read in conjunction with this enumeration
and should thus be construed as usage akin to parks, playgrounds and playlots
which have clear and open space as their common feature. This is consistent with
the principle of ejusdem generis which provides that "where a general word or
phrase follows an enumeration of particular or specific words of the same class or
where the latter follow the former, the general word or phrase is to be construed to
include, or to be restricted to persons, things or cases akin to, resembling, or of the
same kind or class as those specifically mentioned."84 The requirement under
Section 14 (a) of the Subdivision Regulations, therefore, is an open, non-buildable
space. Notably, this construction is consistent with the restriction under Section 2
of PD 1216 which requires that areas in a subdivision reserved for "parks,
playgrounds and recreational use" shall be "non-buildable." The only exception, as
provided in Section 14 (b) of the same Regulations, is the use of the open space
as a school site in the absence of barrio, central or elementary schools in the
vicinity of a proposed residential subdivision.
It appears from the records, however, that the subject property - Blocks 25 and 26
in the Subdivision Plan - had been designated not as an open space, but as the
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sites for the City Hall and market, respectively. Thus, TCT No. 671 contains the
following inscription:
Entry 3296 - ORDER
Existence of approved subdivision Plan LRC Psd-9671 with technical descriptions
for Block 4 with 19 lots, Block 10 with 28 lots; Block 11 with 40 lots; Block 12 with
19 lots; Block 13 with 3 lots; Block 14 with 3 lots; Block 15 with 5 lots; Block 16
with 25 lots; Block 17 with 18 lots; Block 18 with 38 lots Block 19 with 44 lots;
Block 20 with 45 lots; Block 21 with 11 lots, Block 22 with 9 lots; Block 23 with 18
lots; Block 24 with 17 lots; Block 25 City Hall Site and Block 26 Market Site;
Road lots No. 10 to 30 cannot be disposed without prior approval of the court. Date
of order Aug. 23, 1962. Inscribed September 13, 1962 10:35 a.m.
(Sgd) ROLANDO G. ALBERTO
Reg. of Deeds, Naga City85
(Emphasis ours)
The City had represented to the CA that the Subdivision Plan had been approved
by the National Planning Commission and the then Court of First Instance. 86 No
evidence has been adduced to show that as so approved, the Subdivision Plan
indicated areas within Blocks 25 and 26 for use as parks, playgrounds or other
recreational purposes.
There is likewise no debate that the subject property is in fact used as the site of
the City Hall and other government offices. During the pre-trial conference, the
parties stipulated that four hectares of the subject property are occupied by the
City Hall and other government agencies.87 While one hectare of the subject
property is admittedly occupied by the Naga Civic Center,88 it has not been
established that it comprises public open space as contemplated in the Subdivision
Regulations.
In any event, the City cannot successfully invoke the Subdivision Regulations as
basis to demand vested proprietary rights over the subject property. Contrary to its
position that roads as well as open space in subdivisions instantly belong to the
government without need of compensation or any overt act of donation, the
Subdivision Regulations indicate that local governments did not automatically
become the owner of roads and open space in subdivisions within their jurisdiction
and a positive act of conveyance or dedication was necessary to vest ownership in
the city or municipality, thus:
Sec. 17. Improvements.
xxxx
h. Utilities in general. - Unless street areas are conveyed to the city or
municipality, the approval of a subdivision plan binds the subdivider and his
successors to permit all public utilities to use the streets for furnishing services to
the subdivision, in accordance with existing municipal or city regulations.90
Sec. 19. Approval.
xxxx
h. Dedication of streets, highways and ways — The approval of the Final Plan by
the Commission shall not be deemed to constitute or effect an acceptance by
the government of the dedication of any street, or other proposed public way
or space shown on the Plat. The subdivider may, if he so desires, offer to
dedicate all streets, highways, and other ways shown in the approved Final Plat
for public use, but the government may, at its discretion, or upon the
recommendation of the National Urban Planning Commission, accept only such
streets, highways and other ways as it deems necessary for public
purposes. It shall be the duty of the subdivider to improve, repair and maintain all
streets, highways and other ways in the subdivision until their dedication to
public use is accepted by the government.91 (Emphasis ours)
Parenthetically, even under PD 957, specifically Section 31,92 it was optional on
the part of the owner or developer of the subdivision to donate the roads and open
space found therein. Furthermore, under PD 1216, "(t)he-transfer of ownership
from the subdivision owner-developer to the local government is not automatic but
requires a positive act from the owner-developer before the city or municipality can
acquire dominion over the subdivision roads," such that "until and unless the roads
are donated, ownership remains with the owner-developer."93
The City's reliance on the 1991 White Plains case is misplaced. The case involved
Road Lot 1 in the White Plains Subdivision, which had been set aside for the
proposed Highway 38 of Quezon City. The Court held therein that said road was
thus withdrawn from the commerce of man as the open space required by law to
be devoted for public use, and its ownership was automatically vested in the
Quezon City Government and/or the Republic of the Philippines without need of
compensating the developer, the donation thereof being a mere formality.
However, as explained by this Court Albon v. Mayor Fernando:94
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The ruling in the 1991 White Plains Association decision relied on by both the trial
and appellate courts was modified by this Court in 1998 in White Plains
Association v. Court of Appeals. Citing Young v. City of Manila, this Court held in
its 1998 decision that subdivision streets belonged to the owner until donated to
the government or until expropriated upon payment of just compensation. 95
Furthermore, in Woodridge School, Inc. v. ARB Construction Co., Inc.,96 where the
1991 White Plainscase was similarly applied by the trial court in holding that a
subdivision road automatically belonged to the government, the Court ruled:
In the case of Abellana, Sr. v. Court of Appeals, the Court held that the road lots in
a private subdivision are private property, hence, the local government should first
acquire them by donation, purchase, or expropriation, if they are to be utilized as a
public road. Otherwise, they remain to be private properties of the owner-
developer.
Contrary to the position of petitioners, the use of the subdivision roads by the
general public does not strip it of its private character. The road is not converted
into public property by mere tolerance of the subdivision owner of the public's
passage through it. To repeat, the local government should first acquire them by
donation, purchase, or expropriation, if they are to be utilized as a public road. 97
Petitioners cannot simply demand just compensation in lieu of recovering
possession as there was no expropriation
Invoking the case of Alfonso v. Pasay City,97 as cited in Republic v. Court of
Appeals,98 the City argued that recovering possession of the subject property is no
longer feasible because it is now occupied and used by the City Hall and other
government offices, so that petitioners' remedy is merely to demand payment of
just compensation.
The Court's exact pronouncement in Alfonso states:
As registered owner, (Alfonso) could bring an action to recover possession at any
time because possession is one of the attributes of ownership of land. However,
said restoration of possession by the City of Pasay is neither convenient nor
feasible because it is now and has been used for road purposes. So, the only relief
available is for the City of Pasay to make due compensation, which it could and
should have done years ago since 1925.99
It will be noted, however, that in the cases thus invoked, and in other' cases where
the Court made a similar ruling,100 the government took the property in the
exercise of its power of eminent domain. This case clearly involves a different
factual milieu as the subject property was not expropriated by the government. It
had been offered by its owners-developers, under certain terms, for donation to the
City as the City Hall and market sites within the subdivision, which offer the City
clearly had the option to refuse. In fact, the Subdivision's General Manager, Lopez
Jr., appeared to have written to Macario essentially asking him to defer the
donation because while the Municipal Board accepted their offer, they had
considered "other and better alternative sites near the National Highway."101
The "power of eminent domain" has been defined thus:
The right of eminent domain is "the ultimate right of the sovereign power
to appropriate, not only the public but the private property of all citizens within the
territorial sovereignty, to public purpose."102 (Emphasis ours)
[E]minent domain, also often referred to as expropriation and, with less frequency,
as condemnation, is, like police power and taxation, an inherent power of
sovereignty. It need not be clothed with any constitutional gear to exist; instead,
provisions in our Constitution on the subject are meant more to regulate, rather
than to grant, the exercise of the power. Eminent domain is generally so described
as "the highest and most exact idea of property remaining in the government" that
may be acquired for some public purpose through a method in the nature of
a forced purchase by the State.103 (Emphasis ours)
In the instant case, there was no such appropriation or condemnation or forced
purchase to speak of. The City was not propelled by an imperative need to take
the subject property for a public purpose. The City, in taking possession of the
subject property, was not exercising a sovereign function-as expropriator. In this
light, the Alfonso ruling cannot be applied to petitioners.
The City is not entitled to the rights of a builder in good faith
By law, one is considered in good faith if he is not aware that there exists in his title
or mode of acquisition any flaw which invalidates it.104 The essence of good faith
lies in an honest belief in the validity of one's right, ignorance of a superior claim,
and absence of intention to overreach another.105
By these standards, the City cannot be deemed a builder in good faith.
The evidence shows that the contract for the construction of the City Hall by the
Subdivision was an integral component of the latter's offer of donation, constituting
an essential condition for the intended conveyance. Thus, by their July 30, 1954
letter106 to the Naga City Mayor, the Subdivision and the registered owners of the
subject property submitted their "amended offer to construct the City Hall for Naga
City within the premises of the subdivision." The letter stated that the City Hall
would be erected on not less than two hectares of the five-hectare land to be
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donated by Macario and Gimenez to the City. It also proposed a financing scheme
for the construction of the City Hall, the construction cost not to exceed P150,000.
It is, thus, readily apparent that the construction contract was the impetus for the
offer of donation, and that such offer was made to persuade the City to award the
contract to the Subdivision.
On August 11, 1954, the Municipal Board adopted Resolution No. 89107 accepting
the Subdivision's July 30, 1954 offer as amended by Lopez Jr.'s oral
representations in the Board's open session as regards the financing aspect of the
transaction. Consequently, Macario and Gimenez delivered possession of the
subject property to the City government of Naga.108
However, on January 20, 1959, the Municipal Board issued Resolution No.
11109 authorizing the City Mayor to enter into a contract with Sabaria for the
construction of the City Hall.
That the Subdivision would, by its July 30, 1954 proposal, undertake the
construction is evident from Lopez Jr.'s letter110 of August 23, 1954 informing
Macario that he would defer the "making of the plans of the building" until the
location of the City Hall was settled. That the construction contract was the
condition for the proposed donation finds support in Macario's September 17, 1959
letter111 to Mayor Imperial and May 14, 1968112 letter to Lopez Jr. which indicated
that in February 1959, or the month after the construction contract was awarded to
Sabaria, Mayor Imperial proposed for the Naga City government to "buy instead"
the subject property.
Macario's September 17, 1959 letter to Mayor Imperial reads:
Joe and I would like to know from you the status of your proposal you have
intimated to us during our meeting last February at my residence regarding your
offer for the city government of Naga to buy instead the parcels of land which we
contemplated to donate to the city as city hall and market site.
It has been long since then our last conversation regarding your proposal and have
not heard any positive development from you.
Please advice [sic] us soonest and hope this be given preferential action by your
Office.113
His May 14, 1968 letter to Lopez Jr. in turn reads:
Please be advised to disregard all my previous letters and instructions to you
regarding the donation of the city hall and market sites to the City of Naga. Kindly
make immediate representation to the City Mayor and insist on the previous
proposal made by Mayor Monico Imperial for the city to buy the land we offered to
them.
Considering the lapse of time and until now, no clear actions have been made by
the city, I suggest you take whatever appropriate actions on this matter the
soonest possible time.114
The foregoing circumstances ineluctably show that the City knew of a substantial
flaw in its claim over the subject property. The proposed donation was conditioned
on the award of the construction contract to the Subdivision. By its Resolution No.
89, the City accepted the proposal with all its conditions. Thus, the City could not
have been unaware that by awarding the same construction contract to Sabaria, it
no longer had any cause to continue occupying the subject property as the
condition for the proposed donation had not been satisfied. Accordingly, it should
have vacated the subject property. However, it stayed on and allowed Sabaria to
undertake the construction.
Furthermore, Macario's September 17, 1959 and May 14, 1968 letters showed that
Mayor Imperial had proposed that the Naga City government would just buy the
subject property from him and Gimenez. Said letters also indicated that Macario
had long been waiting for the City to act on this proposal but the latter had not
taken any action. The City, in the meantime, continued to enjoy possession of the
subject property and subsequently allowed other government agencies to build
their offices in the premises. The proposal, however, was never brought to fruition
by the City.
It cannot, thus, be said that the City was of an honest belief that it had a valid right
to the subject property or that its actions had not overreached the landowners.
Accordingly, it cannot be considered to have acted in good faith.
Articles 449 and 450 of the Civil Code provide:
Art. 449. He who builds, plants or sows in bad faith on the land of another, loses
what is built, planted or sown without right of indemnity.
Art. 450. The owner of the land on which anything has been built, planted or sown
in bad faith may demand the demolition of the work, or that the planting or sowing
be removed, in order to replace things in their former condition at the expense of
the person who built, planted or sowed; or he may compel the builder or planter to
pay the price of the land, and the sower the proper rent.
Thus, petitioners, as hereditary successors of the registered owners of the subject
property, have the right to appropriate what has been built on the property, without
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any obligation to pay indemnity therefor, and the City has no right to a refund of
any improvement built therein.116
The CA ruled that Macario's May 14, 1968 letter was a mere photocopy and could
not thus be received as secondary evidence absent a clear showing that its
original had been lost or destroyed. The Court notes, however, that this letter,
along with Macario's September 17, 1959 missive, were offered by petitioners and
admitted by the MTC117 without any objection from the City either as to their
admissibility or the purposes for which they were submitted.
It is well-settled that evidence not objected to is deemed admitted and may be
validly considered by the court in arriving at its judgment. 118 This is true even if by
its nature the evidence is inadmissible and would have surely been rejected if it
had been challenged at the proper time.119 Once admitted without objection, even
though not admissible under an objection, We are not inclined now to reject
it.120Consequently, the evidence that was not objected to became property of the
case, and all parties to the case are considered amenable to any favorable or
unfavorable effects resulting from the said evidence.121
Neither laches nor prescription had set in
It is settled that:
Laches is the failure or neglect, for an unreasonable and unexplained length of
time, to do that which, by exercising due diligence, could or should have been
done earlier; it is negligence or omission to assert a right within a reasonable time,
warranting the presumption that the party entitled to assert it either has abandoned
or declined to assert it. There is no absolute rule as to what constitutes laches or
staleness of demand; each case is to be determined according to its particular
circumstances, with the question of laches addressed to the sound discretion of
the court. Because laches is an equitable doctrine, its application is controlled by
equitable considerations and should not be used to defeat justice or to perpetuate
fraud or injustice.122
By his September 17, 1959 and May 14, 1968 letters, Macario has been shown to
have taken steps to have the City act on Mayor Imperial's proposal to "buy
instead" the subject property. His efforts were overtaken, by his death three years
later in 1971. Furthermore, as the RTC found, petitioners had been engaged in
litigation to establish their right to inherit from Macario and Irene, and it was
Danilo's discovery of the subject property, following the issuance to him of letters
of administration over Irene's estate in 1997, that prompted them to issue a
demand for the City to vacate the premises.
Given these circumstances, the Court is not disposed to conclude that there was
an unreasonable or unexplained delay that will render petitioners' claim stale.
In contrast, the City, despite its claim of having acquired the subject property by
donation in 1954, has itself failed to have the same transferred in its name for a
long period of time. Indeed, the subject property remains registered in the name of
petitioners' predecessor-in-interest as co-owner.
The rule is that an action to recover possession of a registered land never
prescribes in view of the provision of Section 44 of Act No. 496 to the effect that no
title to registered land in derogation of that of a registered owner shall be acquired
by prescription or adverse possession. It follows that a registered owner's action to
recover a real property registered under the Torrens System does not prescribe. 122
Thus, it has been consistently held that registered owners have the right to evict
any person unlawfully occupying their property, and this right is imprescriptible and
can never be barred by laches.123 Even if it be supposed that they were aware of
the occupant's possession of the property, and regardless of the length of that
possession, the lawful owners have a right to demand the return of their property
at any time as long as the possession was unauthorized or merely tolerated, if at
all.124
Moreover, it is well settled that the rule on imprescriptibility of registered lands not
only applies to the registered owner but extends to the heirs of the registered
owner as well. As explained in Mateo v. Diaz,125 prescription is unavailing not only
against the registered owner, but also against his hereditary successors because
the latter step into the shoes of the decedent by operation of law and are the
continuation of the personality of their predecessor-in-interest.126 Consequently,
petitioners, as heirs of registered landowner Macario, cannot be barred by
prescription from claiming possession of the property.
Restitution of premises, reasonable rent and attorney's fees
Section 17, Rule 70 of the Rules of Court provides:
Sec. 17. Judgment. - If after trial the court finds that the allegations of the
complaint are true, it shall render judgment in favor of the plaintiff for the restitution
of the premises, the sum justly due as arrears of rent or as reasonable
compensation for the use and occupation of the premises, attorney's fees and
costs. x x x
Thus, the rightful possessor in an unlawful detainer case is entitled to the return of
the property and to recover damages, which refer to "rents" or "the reasonable
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compensation for the use and occupation of the premises," or the "fair rental value
of the property" and attorney's fees and costs. More specifically, recoverable
damages are "those which the plaintiff could have sustained as a mere possessor,
or those caused by the loss of the use and occupation of the property."127
The RTC granted petitioners' prayer for a monthly rental of P2.5 million (or P50.00
per square meter) as reasonable compensation for the City's use and occupation
of the subject property from November 30, 2003 until the premises are actually
vacated. However, in its March 7, 2011 Decision, the CA reduced the monthly
rental to P500,000.00 (or P10.00 per square meter), holding that:
The very reason why the monthly rental of the premises surrounding the City Hall
is as high as that pegged by the lower appellate court (at Php 50.00 per square
meter or Php 2,500,000.00 for the 50,000 square meters), is the presence of the
local government at the site. It should not, therefore, be burdened too much in the
computation of the monthly rental when it has contributed in a major way in making
the area an upscale one. Thus, the Court submits that the monthly rental of Php
500,000.00 is just equitable under the circumstances.128
There is logic in the CA's ratiocination that the presence of the local government in
the subject property enhanced the value of real estate in its vicinity. The Court,
however, cannot lose sight of the fact that the City's occupation of the subject
property has been blighted by bad faith. The benefit to the real estate values had
been at the expense of the rights of Macario and Gimenez and their successors-in-
interest.
Furthermore, it has been held that the reasonable compensation contemplated in
Section 17, Rule 70 "partakes of the nature of actual damages." While the court
may fix the reasonable amount of rent, it must base its action on the evidence
adduced by the parties. The Court has defined "fair rental value" as the amount at
which a willing lessee would pay and a willing lessor would receive for the use of a
certain property, neither being under compulsion and both parties having a
reasonable knowledge of all facts, such as the extent, character and utility of the
property, sales and holding prices of similar land and the highest and best use of
the property.129
Petitioners based their prayer for a P50.00 rental rate on the P110.00 monthly rent
per square meter under a 2004 lease contract over another property situated near
the subject premises.130 The burden of proof to show that the rental demanded is
unconscionable or exorbitant rests upon the City. 131 The City, however, has not
adduced controverting evidence as to the. fair rental value of the premises. 132 All
things considered, the Court finds petitioners' prayer for compensation at less than
half the rate indicated in said lease contract to be reasonable. 133
The fair rental value is to be reckoned from the time of the demand to
vacate.134 The City received two demand letters from petitioners; the second
"extend(ed)" its stay in the subject property for another two months from the
30th day of the month when it received the initial demand letter on September 10,
2003.135 Thus, the reasonable rent was due not from November 3, 2003 as the CA
declared in its March 7, 2011 Decision, but from November 30, 2003, and should
be paid until the subject property is vacated.
The Court agrees with the CA's holding in its March 7, 2011 Decision that the
amount due to petitioners shall only be half of the reasonable rent as the subject
property was co-owned by Macario with Gimenez. Absent proof to the contrary, the
portions belonging to the co-owners in the co-ownership shall be presumed
equal.136
As regards attorney's fees, the RTC awarded the same in the amount of
P587,159.60 or 10% of the property's market value based on the tax declarations.
In its March 7, 2011 Decision, the CA reduced the award to P200,000.00 on
equitable grounds, considering the extent of legal services rendered by petitioners'
counsel.137
The Court finds either award to be excessive. Indubitably, petitioners were
constrained to litigate to protect their interest.138 However, considering the
circumstances of the case, including the summary139nature of an unlawful detainer
proceeding, the Court holds that an award of P75,000.00 as attorney's fees is fair
and reasonable.
Decision is binding on privies or parties deriving possession from the City
In its March 7, 2011 Decision, the CA held that the government offices occupying
the subject property, other than the City government of Naga, could not be ordered
to vacate the same because they were not parties to the case.
Jurisprudence, however, instructs that:
A judgment directing a party to deliver possession of a property to another is in
personam. x x x Any judgment therein is binding only upon the parties properly
impleaded and duly heard or given an opportunity to be heard. However, this rule
admits of the exception, such that even a non-party may be bound by the
judgment in an ejectment suitwhere he is any of the following: (a) trespasser,
squatter or agent of the defendant fraudulently occupying the property to frustrate
the judgment; (b) guest or occupant of the premises with the permission of the
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defendant; (c) transferee pendente lite; (d) sublessee; (e) co-lessee; or (f)
member of the family, relative or privy of the defendant.140 (Emphasis ours)
Exceptions (b) and (f) are clearly applicable. There is no dispute that the
government offices were allowed by the City to occupy the subject property.
Deriving their possession from the City, they are unmistakably the City's privies in
the occupation of the premises.141 Thus, they too are bound by the judgment in this
case.
Determination of ownership is not conclusive
It must be stressed that the ruling in this case is limited only to the determination of
who between the parties has a better right to possession. This adjudication is not a
final determination on the issue of ownership and, thus, will not bar or prejudice an
action between the same parties involving title to the property, if and when such
action is brought seasonably before the proper forum.143
WHEREFORE, the petition is GRANTED. The Court of Appeals' Amended
Decision dated July 20, 2011 is SET ASIDE. The Decision dated June 20, 2005 of
the Regional Trial Court, Branch 26 of Naga City in Civil Case No. RTC 2005-0030
is REINSTATED with MODIFICATION in that: (a) petitioners shall be paid only
half of the adjudged monthly rental of P2,500,000; and (b) the award of attorney's
fees is reduced to P75,000.
SO ORDERED.
CONTEMPT
G.R. No. 129521 September 7, 1999
SECURITIES AND EXCHANGE COMMISSION CHAIRMAN PERFECTO R.
YASAY, JR., ASSOCIATE COMMISSIONERS FE ELOISA C. GLORIA, EDIJER
MARTINEZ and ROSALINDA U. CASIGURAN, petitioners,
vs.
MANUEL D. RECTO, PELAGIO T. RICALDE and CESAR P.
MANALAYSAY, respondents.
PARDO, J.:
The case before the Court is an appeal from a decision of the Court of
Appeals 1 setting aside the order of the Securities and Exchange Commission
(SEC) 2 declaring respondents guilty of contempt for disobeying a temporary
restraining order issued to respondents to desist from holding a stockholders
meeting of the Interport Resources Corporation.
The facts are as follows:
On June 28, 1996, SEC Chairman Yasay upon request of certain stockholders of
Interport Resources Corporation, directed respondent Ricalde to submit to the
SEC a list of stockholders and to set a definite time and place for the validation of
proxies and nominations for directors of the firm.
On the same date, June 28, 1996, the SEC issued a temporary restraining order
(TRO) enjoining the Interport Resources Corporation from holding the July 9, 1996
scheduled annual meeting of the stockholders.
Notwithstanding the SEC's TRO, the stockholders proceeded with the meeting on
July 9, 1996, presided over by respondent Manalaysay.
On July 10, 1996, the SEC declared the stockholders meeting of Interport
Resources Corporation held on July 9, 1996, null and void and directed
respondents to appear before the SEC on July 15, 1996, at 3:00 p.m., to show
cause why no disciplinary action should be taken against them or why they should
not be cited in contempt.
At the hearing on July 15, 1996, respondent Manalaysay questioned the validity of
the TRO as well as the contempt proceedings in light of the TRO issued by the
Court of Appeals restraining the SEC from enforcing its TRO. 3
After the hearing, on July 15, 1996, the SEC issued an order stating:
xxx xxx xxx
VIEWED in this light Atty. Cesar Manalaysay, Manuel D. Recto
and Atty. Pelagio T. Ricalde are hereby DECLARED GUILTY OF
CONTEMPT and are correspondingly ORDERED to pay a fine of
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 TEN THOUSAND (P10,000.00) Pesos each upon finality of this
Order for willfully disobeying and disregarding the July 8, 1996
Order of this Commission. Atty. Cesar Manalaysay is likewise
BARRED from practicing his law profession before this
commission for a period of sixty (60) days from date hereof and
Mr. Recto and Atty. Ricalde are, by this ORDER, prohibited and
barred from acting as President/Chairman and Secretary
respectively of Interport Resources, Inc. within the same period.
This Order shall be immediately executory unless otherwise
restrained by a court of competent jurisdiction.
SO ORDERED.
EDSA, Greenhills, Mandaluyong City.
(s/t) PERFECTO R. YASAY, JR.
Chairman
(s/t) FE ELOISA C. GLORIA
Associate Commissioner
(s/t) EDIJER A. MARTINEZ
Associate Commissioner4
In due time, respondents appealed from the aforesaid order to the Court of
Appeals.
After due proceedings, on April 14, 1997, the Court of Appeals promulgated its
decision reversing and setting aside the SEC order declaring respondents guilty of
contempt. The dispositive portion reads:
WHEREFORE, premises considered, respondents' Order dated
July 15, 1996, is hereby REVERSED and SET ASIDE.
The cash bond of P50,000.00 may be withdrawn by petitioners.
SO ORDERED.
(s/t) ARTEMIO G. TUQUERO
Associate Justice
(s/t) ARTEMON D. LUNA
Associate Justice
(s/t) HECTOR L. HOFILEÑA
Associate Justice 5
On May 2, 1997, petitioners filed a motion for reconsideration of the decision.
However, on June 11, 1997, the Court of Appeals denied the motion.
Hence, this appeal.
On September 10, 1997, the Court required respondents to comment on the
petition within ten (10) days from notice. 6 On October 7, 1997, respondents filed
their comment. 7 In the main, respondents submit that contempt is criminal in
character and their exoneration from a charge of contempt amounts to an acquittal
from which an appeal would not lie. 8
At issue in this petition is whether or not the Court of Appeals erred, as a matter of
law, in setting aside the order of the SEC finding respondents guilty of contempt for
disobeying its temporary restraining order to desist from holding the annual
stockholders meeting of the Interport Resources Corporation scheduled on July 9,
1996.
We agree with respondents that the charge of contempt partakes of the nature of a
criminal offense. 9 The exoneration of the contemner from the charge amounts to
an acquittal from which an appeal would not lie.
A distinction is made between a civil and criminal contempt. Civil contempt is the
failure to do something ordered by a court to be done for the benefit of a party. A
criminal contempt is any conduct directed against the authority or dignity of the
court. 10
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Petitioners argue that the contempt committed by respondents was civil in nature,
as the temporary restraining order the SEC issued was for the benefit of a party to
a case. The contention is untenable.
"Civil contempt proceedings are generally held to be remedial and civil in their
nature; that is, they are proceedings for the enforcement of some duty, and
essentially a remedy for coercing a person to do the thing required." 11 "In general,
civil contempt proceedings should be instituted by an aggrieved party, or his
successor, or someone who has a pecuniary interest in the right to be
protected." 12 If the contempt is initiated by the court or tribunal exercising the
power to punish a given contempt, it is criminal in nature, and the proceedings are
to be conducted in accordance with the principles and rules applicable to criminal
cases. The State is the real prosecutor. 13
"The real character of the proceedings in contempt cases is to be determined by
the relief sought or by the dominant purpose. The proceedings are to be regarded
as criminal when the purpose is primarily punishment, and civil when the purpose
is primarily compensatory or remedial." 14
"But whether the first or the second, contempt is still a criminal proceeding in which
acquittal, for instance, is a bar to a second prosecution. The distinction is for the
purpose only of determining the character of punishment to be administered." 15
In this case, the contempt is not civil in nature, but criminal, imposed to vindicate
the dignity and power of the Commission; hence, as in criminal proceedings, an
appeal would not lie from the order of dismissal of, or an exoneration from, a
charge of contempt." 16
At any rate, the SEC order directing respondents to show cause why they should
not be cited in contempt was highly improper. The Court of Appeals issued on July
8, 1996, a temporary restraining order against the order of the SEC of June 28,
1996 directing the Interport Resources Corporation to desist from holding the
stockholders' meeting on July 9, 1996. Contrary to the view of petitioners, the
effect of the temporary restraining order of the Court of Appeals directing the SEC
to desist from enforcing its own TRO was to allow such meeting to proceed as
scheduled. More, the Court of Appeals in its final decision nullified the SEC's
order. 17 Hence, there was no willful disobedience to a lawful order of the SEC.
Respondents were not guilty of contempt.
While the SEC is vested with the power to punish for contempt, 18 the salutary rule
is that the power to punish for contempt must be exercised on the preservative, not
vindictive principle, 19 and on the corrective and not retaliatory idea of
punishment. 20 The courts and other tribunals vested with the power of contempt
must exercise the power to punish for contempt for purposes that are impersonal,
because that power is intended as a safeguard not for the judges as persons but
for the functions that they exercise. 21
In this case, the SEC issued the citation for contempt sua sponte. There was no
charge filed by a private party aggrieved by the acts of respondents. Strictly
speaking, there was no disobedience to the SEC's temporary restraining order.
The Court of Appeals enjoined that order. Consequently, respondents' act in
proceeding with the scheduled stock-holders' meeting was not contumacious as
there was no willful disobedience to an order of the SEC. 22 The disobedience
which the law punishes as constructive contempt implies willfulness. For, at
bottom, contempt is a willful disregard or disobedience. 23
The SEC was rather hasty in asserting its power to punish for contempt. The
chairman and commissioners of the SEC must exercise the power of contempt
judiciously and sparingly with utmost self-restraint. 24
Finally, the penalty imposed exceeded those authorized in the powers of the
SEC 25 in relation to the 1964 Revised Rules of Court as amended. 26 If the
contempt was committed against a superior court or judge, the accused may be
fined not exceeding thirty thousand pesos (P30,000.00) or imprisoned not more
than six (6) months, or both. The SEC suspended respondent Manalaysay from
27
the practice of law in the SEC, a power vested exclusively in the Supreme Court.
WHEREFORE, the Court hereby DENIES the petition for review on certiorari and
AFFIRMS the decision of the Court of Appeals in GA-G.R. SP No. 41400,
promulgated on April 14, 1997.1âwphi1.nêt
No costs.
SO ORDERED.
Page 485 of 507
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A.M. No. RTJ-03-1771 May 27, 2004
(Formerly A.M. OCA-IPI No. 99-842-RTJ)
SALVADOR SISON, complainant,
vs.
JUDGE JOSE F. CAOIBES, JR., Presiding Judge, and TEODORO S.
ALVAREZ, Sheriff IV, Regional Trial Court, Las Piñas City, Branch
253, respondents,
DECISION
CALLEJO, SR., J.:
The instant administrative complaint arose when Salvador Sison, a Metropolitan
Manila Development Authority (MMDA) traffic enforcer, filed a verified
Complaint1 dated October 12, 1999, charging Judge Jose F. Caoibes, Jr. and
Sheriff Teodoro Alvarez of the Regional Trial Court of Las Piñas City, Branch 253,
with grave abuse of authority.
In turn, the complaint stemmed from an Order2 dated September 15, 1999 in
Criminal Case No. 99-0023 which the respondent judge issued, requiring the
complainant to appear before him to explain a traffic incident involving his son and
the complainant. The said Order reads, thus:
Per information from the authorized driver of the Presiding Judge of this
Court on September 8, 1999, at about 3:00 o’clock in the afternoon of said
date, said authorized driver, while on board the official car of the
undersigned on an official errand was flagged by the accused along the
Epifanio delos Santos Avenue while he was positioning the car he was
driving to the right lane as he was then to make a right turn; that after he
stopped, he was told by the accused that swerving to the right lane was
prohibited when it appeared that the sign therefore was still far off and not
readily visible to the naked eye; that nonetheless, he introduced himself as
the authorized driver of the undersigned, his son in fact, and showed to the
accused the calling card of the undersigned with a notation in (sic) the
dorsal portion thereof introducing the bearer of the card and requesting for
assistance from law enforcers, and accordingly begged that he be allowed
to proceed on his way considering that there was no danger to limb, life
and property occasioned by his alleged traffic violation; that
notwithstanding such introduction and plea, the accused confiscated the
driver’s license of the authorized driver, even bragging in the process that
he did the same to somebody who introduced himself as a lawyer the day
before.
The aforementioned actuation of the accused, if true, is not only indicative
of his arrogance and deliberate disregard of the usual respect, courtesy
and accommodation accorded to a court of law and/or its representative
but is one constitutive of indirect contempt under Section 3, paragraphs (c)
and (d) of Rule 71 of the Rules of Court, specially considering that the
authorized driver of the Presiding Judge of this Court was then on official
errand.
WHEREFORE, within a non-extendible period of twenty-four (24) hours
from receipt hereof, the accused is ordered to show cause why he should
not be cited as in contempt of court and dealt with accordingly. The Branch
Sheriff of this Court is authorized and ordered to serve a copy of this Order
upon the accused immediately and to make a return of his proceedings
thereon. After receipt of this Order, the accused is ordered
to personally file his comment in Court, within the period allowed him
herein.
SO ORDERED.4
Because of the complainant’s failure to appear before the respondent judge as
directed, the latter, after verifying that the said order was duly served on the
complainant, issued another Order5 dated September 22, 1999 for the
complainant’s arrest and commitment, and for the latter to appear for hearing
before his sala on September 29, 1999. The respondent sheriff then served the
order on the complainant. On the scheduled hearing, the complainant appeared
and executed an affidavit6 admitting to the court that he made a mistake and that it
was all a misunderstanding. The respondent judge, thereafter, lifted the September
22, 1999 Order.7
In his complaint, the complainant alleged inter alia the following:
6. That on September 28, 1999, at around 6:00 P.M., the undersigned
complainant was greatly surprised when respondent TEODORO
ALVAREZ came and arrested him without any warrant of arrest, only on
orders of the respondent Judge, and he was ordered to board a motor
vehicle and was brought to the respondent Judge in Las Piñas City who
Page 486 of 507
Cases – Special Civil Actions (Part 1)
 ordered him detained in the Las Piñas City Jail. When he was arrested, he
was not able to call his family to inform them where he was because he
failed to return home in the evening;
7. That the next day, September 29, 1999, respondent Teodoro Alvarez
informed him that there will be a hearing of his indirect contempt
charge before the sala of the respondent Judge in Las Piñas City. During
the hearing, the complainant was made to admit by the respondent Judge
that he made a mistake in apprehending his driver-son[,] conscious that he
committed the gravest abuse of his authority, and perhaps in anticipation
of the legal action the undersigned complainant may take against him after
he is discharged from detention. Thus, after the complainant admitted his
mistakes under duress, and upon appeal by his counsel assuring the
respondent Judge that the same incident may not be repeated, the
complainant was ordered discharged from detention at around 3:30 P.M.
on September 29, 1999;
8. That the undersigned complainant did not know of any offense he had
committed, except for his issuing a traffic violation receipt to the driver-son
of the respondent Judge which he is tasked by law to do so for those
found violating traffic rules and regulations;
9. That if the act of issuing a traffic violation receipt for a traffic violation
within the city limits of Mandaluyong City by the complainant is considered
by the respondents as an offense, then complainant should be tried for the
said offense in Mandaluyong City, and not in Las Piñas City where the
respondent judge has no jurisdiction;
10. That to the ordinary and lowly understanding of the undersigned
complainant, the acts of respondents in arresting him without any warrant
of arrest before a charge of indirect contempt is heard constitute the
gravest ABUSE OF AUTHORITY ever committed by the respondents; and
11. That the manner the respondents are administering justice in Las
Piñas City is despotic and barbaric in the sense that they take the law into
their own hands without due regard for the rights of the others.8
The complainant, thus, prayed that the respondents be summarily dismissed from
the service.
In his comment, the respondent judge vehemently denied the accusations against
him, contending that he was merely preserving the dignity and honor due to the
courts of law. The respondent narrated that on September 8, 1999, he ordered his
son, Jose R. Caoibes III, to go to the Pasig City Regional Trial Court to secure
certain records. While on his way there, he was flagged down by the complainant
for an alleged traffic violation. Caoibes III explained to the complainant that he was
on an errand for his father, the respondent judge, to which the complainant
reportedly uttered, "Walang Judge, Judge Caoibes sa akin; kahapon nga, abogado
ang hinuli ko."
The respondent judge also alleged that he initiated the complaint for contempt
pursuant to the following provisions of the Revised Rules of Court: a) Section 3(d)
and Section 4 of Rule 71; b) Section 5(c) of Rule 135; and, c) the last paragraph of
Section 3 of Rule 71.
According to the respondent judge, the complainant’s allegation that he failed to
contact any relative is belied by the fact that during the hearing of September 29,
1999, the complainant was assisted by Atty. Eduardo P. Flores of the MMDA, as
evidenced by the transcript of stenographic notes 9 taken during the proceedings.
The respondent prayed that the instant complaint be dismissed for lack of legal or
factual basis.
For his part, the respondent sheriff admitted that he personally served copies of
the respondent judge’s orders on the complainant, but averred that he was merely
performing his duties as deputy sheriff of the court. As such, he did not commit
grave abuse of authority in the performance of his functions.10
Thereafter, the complainant executed a Sinumpaang Salaysay ng Pagbawi ng
Reklamo dated November 26, 2002, where he indicated that he was no longer
interested in pursuing the administrative complaint against the respondent judge.
The complainant recanted his earlier claim, averring that the respondent judge’s
son did not in fact enter a one-way street and that he was standing by the
September 29, 1999 Affidavit he executed during the hearing. He then requested
that his complaint be duly withdrawn.11
Pursuant to the recommendation12 of the Court Administrator, the Court, in a
Resolution13 dated April 2, 2003, resolved to (a) dismiss the instant administrative
complaint against Sheriff Teodoro Alvarez for lack of merit; and (b) refer the matter
against respondent Judge Caoibes, Jr. to the Presiding Justice of the Court of
Appeals for raffle among the Associate Justices of the Court, and for investigation,
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Cases – Special Civil Actions (Part 1)
report and recommendation. The case was, thereafter, raffled to Associate Justice
Lucas P. Bersamin. The Investigating Justice, thereafter, submitted his Sealed
Report dated February 26, 2004.
According to the Investigating Justice, although the complainant never appeared to
prove the charges against the respondent judge, the facts averred in the complaint
appear to be substantially correct and true. Thus, the respondent judge abused his
authority to charge and punish any person for indirect contempt under Rule 71 of
the Rules of Civil Procedure.14 The Investigating Justice recommended that the
respondent be admonished and warned, pursuant to Section 10(1), Rule 140 of
the Rules of Court, and Section 11(c) of the same rule.
The respondent judge anchors the justification of his acts against the complainant
on Section 3, Rule 71 of the Rules of Civil Procedure, viz:
Sec. 3. Indirect contempt to be punished after charge and hearing. – After
a charge in writing has been filed, and an opportunity given to the
respondent to comment thereon within such period as may be fixed by the
court and to be heard by himself or counsel, a person guilty of any of the
following acts may be punished for indirect contempt:
(a) Misbehavior of an officer of a court in the performance of his
official duties or in his official transactions;
(b) Disobedience of or resistance to a lawful writ, process, order,
or judgment of a court, including the act of a person who, after
being dispossessed or ejected from any real property by the
judgment or process of any court of competent jurisdiction, enters
or attempts or induces another to enter into or upon such real
property, for the purpose of executing acts of ownership or
possession, or in any manner disturbs the possession given to the
person adjudged to be entitled thereto;
(c) Any abuse of or any unlawful interference with the processes
or proceedings of a court not constituting direct contempt under
section 1 of this Rule;
(d) Any improper conduct tending, directly or indirectly, to impede,
obstruct, or degrade the administration of justice;
(e) Assuming to be an attorney or an officer of a court, and acting
as such without authority;
(f) Failure to obey a subpoena duly served;
(g) The rescue, or attempted rescue, of a person or property in the
custody of an officer by virtue of an order or process of a court
held by him.
But nothing in this section shall be so construed as to prevent the court from
issuing process to bring the respondent into court, or from holding him in custody
pending such proceedings.
Thus, the power to declare a person in contempt of court and in dealing with him
accordingly is an inherent power lodged in courts of justice, to be used as a means
to protect and preserve the dignity of the court, the solemnity of the proceedings
therein, and the administration of justice from callous misbehavior, offensive
personalities, and contumacious refusal to comply with court orders. 15 Indeed, the
power of contempt is power assumed by a court or judge to coerce cooperation
and punish disobedience, disrespect or interference with the court’s orderly
process by exacting summary punishment. The contempt power was given to the
courts in trust for the public, by tradition and necessity, in as much as respect for
the courts, which are ordained to administer the laws which are necessary to the
good order of society, is as necessary as respect for the laws themselves. 16 And,
as in all other powers of the court, the contempt power, however plenary it may
seem, must be exercised judiciously and sparingly.17 A judge should never allow
himself to be moved by pride, prejudice, passion, or pettiness in the performance
of his duties.18
At first blush, it would seem that the respondent judge was justified in holding the
complainant for contempt, due to the latter’s refusal to comply with the judge’s
Order of September 15, 1999. However, it is not lost upon this Court that the
complainant was not a party to any of the cases pending before the RTC, Branch
253. What triggered the contempt charge was, in fact, the traffic violation incident
involving the respondent judge’s son. Furthermore, the record shows that when the
complainant filed his reply to the charge as required by the respondent judge, the
same was refused by some staff member in the latter’s sala.19
In Cortes v. Bangalan,20 we held that a judge may not hold a party in contempt of
court for expressing concern on the judge’s impartiality through a motion for
Page 488 of 507
Cases – Special Civil Actions (Part 1)
voluntary inhibition, even if the latter may have felt insulted therein. The Court also
declared, thus:
…[W]hile the power to punish in contempt is inherent in all courts so as to
preserve order in judicial proceedings and to uphold due administration of
justice, judges, however, should exercise their contempt powers
judiciously and sparingly, with utmost restraint, and with the end in view of
utilizing their contempt powers for correction and preservation not for
retaliation and vindication.21
We agree with the Investigating Justice when he opined that the respondent judge
should have refrained from ordering the arrest and detention of the complainant,
since the incident involved his own son, and the matter was very personal to him.
The fact that the respondent judge insisted that the complainant personally file his
comment in court gives rise to doubts as to the motive behind it; as the
Investigating Justice puts it, the requirement of personal filing was deliberately
inserted so that the respondent could confront and harass the complainant.22
We also agree with the following ruminations of Justice Bersamin:
…[T]he respondent judge obviously resented the refusal of Sison to let off
Caoibes III from the traffic violation apprehension. The refusal of Sison
was apparently aggravated by the son’s reporting to the father that Sison
had supposedly made the remarks of Walang judge, judge Caoibes sa
akin; Kahapon nga, abogado ang hinuli ko. …
...
The respondent Judge was not justified to so consider the act and remarks
of Sison as thereby displaying arrogance towards and deliberate disregard
of the usual respect, courtesy and accommodation due to a court of law
and its representative. First of all, the refusal of Sison and the supposed
remarks should not cause resentment on the part of the respondent Judge
(whom Sison most likely did not yet know at the time) because he knew,
as a public official himself, that Sison was only doing his duty of enforcing
evenly the particular traffic regulation against swerving into a one-way
street from the wrong direction, regardless of the office or position of the
violator’s father. Secondly, the respondent Judge should have had the
circumspection expected of him as a judge to realize that the remarks of
Sison were invited by Caoibes III’s attempt to bluffhis way out of the
apprehension because he was the son of an RTC judge. Hence, the
respondent Judge would have no grounds to cite Sison for contempt of
court. And, thirdly, the respondent Judge and his son should have
challenged the issuance of the traffic violation receipt pursuant to the
pertinent rules if they did not agree with the basis of the apprehension and
also administratively charged Sison for any unwarranted act committed.
Since neither was done by them, but, on the contrary, both ultimately
accepted the validity of the apprehension, as borne out by the retrieval of
the driver’s license after September 29, 1999 by paying the fines
corresponding to the traffic violation, then it follows that the respondent
Judge had the consciousness that his son was at fault, instead of Sison.
…[T]he respondent Judge claimed at the hearing that his son "was at that
time working with (sic) me as my personal driver;" and that his errand was
to secure some papers from the Regional Trial Court in Pasig City involved
in a "personal case" which the respondent Judge had "filed against a bank
for specific performance and damages, and since I just suffered a mild
stroke at that time, specifically on June 10, 1999, and the incident took
place (sic) September, I could not at that time personally go to Pasig to
secure the documents I needed for the next hearing of the case so I had to
send my son."
The foregoing renders clear that the respondent Judge had no legitimate
basis by which to consider Sison’s apprehension of his son as indirect
contempt. As indicated earlier, the act complained against must be any of
those specified in Sec. 3, Rule 71, 1997 Rules of Civil Procedure;
otherwise, there is no contempt of court, which requires that the person
obstructed should be performing a duty connected with judicial functions.
As such, the respondent Judge acted oppressively and vindictively.
Parenthetically, it is odd that the respondent Judge would even propose
herein that Caoibes III, already 25 years at the time of the apprehension,
was serving his father as the latter’s personal driver, albeit not officially
employed in the Judiciary. Most likely, therefore, Caoibes III might not be
doing anything for his father at the time of his apprehension but was in the
place for his own purposes.23
The act of a judge in citing a person in contempt of court in a manner which
smacks of retaliation, as in the case at bar, is appalling and violative of Rule 2.01
of the Code of Judicial Conduct which mandates that "a judge should so behave at
Page 489 of 507
Cases – Special Civil Actions (Part 1)
all times to promote public confidence in the integrity and impartiality of the SO ORDERED.
judiciary."24 The very delicate function of administering justice demands that a
judge should conduct himself at all times in a manner which would reasonably
merit the respect and confidence of the people, for he is the visible representation
of the law.25 The irresponsible or improper conduct of judges erodes public
confidence in the judiciary; as such, a judge must avoid all impropriety and the G.R. No. 150949 June 21, 2007
appearance thereof.26
JUDGE DOLORES L. ESPAÑOL,* Presiding Judge, Regional Trial Court,
We do not agree, however, that the respondent judge should be merely Branch 90, Dasmariñas, Cavite,petitioner,
reprimanded for his actuations. The Court has not been blind to the improper use vs.
by judges of the erstwhile inherent power of contempt which, in fine, amounts to ATTY. BENJAMIN S. FORMOSO and SPOUSES BENITO SEE and MARLY
grave abuse of authority. The penalty imposed by the Court in such cases ranges SEE, respondents.
from a fine of P2,500;27 one month’s salary;28 suspension from the service without
pay for a period of three months;29 and even the ultimate penalty of dismissal from DECISION
the service.30
SANDOVAL-GUTIERREZ, J.:
Furthermore, we take judicial notice that the respondent judge was previously
sanctioned by the Court for violating Canon 2 of the Code of Judicial Conduct, Before us is a Petition for Review on Certiorari assailing the Decision1 dated
where he was meted a fine of P20,000.31 He was found guilty of serious September 12, 2001 and Resolution dated November 15, 2001 of the Court of
impropriety unbecoming a judge, for delivering fistic blows on a complainant judge. Appeals in CA-G.R. SP No. 65652.
To our mind, the instant case falls under "similar conduct," which the Court avowed
would be dealt with more severely if repeated, and of which the respondent was The facts are:
duly warned. The respondent was, likewise, found guilty of gross ignorance of
procedural law and unreasonable delay in the issuance of an order of execution,
On April 15, 1994, Sharcons Builders Philippines, Inc. (Sharcons) bought from
where he was meted a fine of P30,000;32 and delay in resolving a motion to
Evanswinda Morales a piece of land consisting of 33,130 square meters in
dismiss in a civil case pending before his sala where he was, likewise, fined
Paliparan, Dasmariñas, Cavite. The property is covered by Transfer Certificate of
P40,000.33
Title (TCT) No. T-278479 issued in her name by the Register of Deeds of Trece
Martires City.
WHEREFORE, the Court finds respondent Judge Jose F. Caoibes, Jr., Regional
Trial Court of Las Piñas City, Branch 253, GUILTY of serious impropriety
Thus, TCT No. T-278479 in Evanswinda’s name was cancelled and in lieu thereof,
unbecoming a judge for violating Canon 2 of the Code of Judicial Conduct, and is
TCT No. T-511462 was issued in the name of Sharcons. However, when the
hereby DISMISSED from the service with forfeiture of all retirement benefits except
latter’s workers tried to fence and take possession of the lot, they were prevented
accrued leave credits, with prejudice to re-employment in any branch of the
by the caretaker of spouses Joseph and Enriqueta Mapua. The caretaker claimed
government or any of its instrumentalities including government-owned and
that spouses Mapua are the owners of the land. Sharcons verified the status of the
controlled corporations.
title and found that TCT No. T-107163 was indeed registered in the names of
spouses Mapua as early as July 13, 1979.
This decision is immediately executory. The respondent is ORDERED to cease
and desist from discharging the functions of his Office. Let a copy of this Decision
On January 25, 2000, Sharcons filed with the Regional Trial Court (RTC), Branch
be entered in the respondent’s personnel records.
90, Dasmariñas, Cavite a complaint for quieting of title, docketed as Civil Case No.

Page 490 of 507

Cases – Special Civil Actions (Part 1)
2035-00. Impleaded as defendants were spouses Mapua, Evanswinda Morales,
and the Register of Deeds of Trece Martires City.
In their answer, spouses Mapua alleged, among others, that all the documents
relied upon by Sharcons are spurious and falsified.
In the course of the proceedings, or on July 9, 2001, Judge Dolores L. Español,
petitioner, issued an Order stating that Benito See and Marly See, president and
treasurer, respectively, of Sharcons, and its counsel, Atty. Benjamin Formoso,
respondents, have used a spurious certificate of title and tax declaration when it
(Sharcons) filed with the RTC its complaint for quieting of title. Consequently,
petitioner declared respondents guilty of direct contempt of court and ordered their
confinement for ten (10) days in the municipal jail of Dasmariñas, Cavite.
Petitioner’s Order is partly reproduced as follows:
From the foregoing circumstances, this Court is of the view and so holds
that the instant case is a callous and blatant imposition of lies, falsehoods,
deceptions, and fraudulent manipulations, through the extensive use of
falsified documents by the plaintiff corporation and its former counsel, Atty.
Benjamin S. Formoso, defendant Evanswinda C. Morales and even the
Geodetic Engineer who connived with this private group on one hand, and
some officials and employees of the government agencies responsible for
the processing and issuance of spurious or falsified titles, on the other.
Unless these fraudulent operations are put to a complete and drastic halt,
the Courts are at the mercy of these unscrupulous people for their own
personal gain.
Using the presumption that whoever is in possession and user of falsified
document is the forger thereof (Gamido v. Court of Appeals, 25 SCRA 101
[1995]), let the appropriate falsification charges be filed against Benito See
and Marly See together with Evanswinda C. Morales. Thus, let a copy of
this Order be forwarded to the National Bureau of Investigation and the
Department of Justice for their appropriate action. As regards Atty.
Benjamin S. Formoso, let a copy of this Order be forwarded to the Bar
Confidant’s Office, Supreme Court. Manila.
Further, Benito See and Marly See, President and Treasurer of Sharcons
Builders Phils. Inc., respectively, and Atty. Benjamin S. Formoso, counsel
for Sharcons until March 13, 2001, are declared and held in contempt for
foisting falsehoods and using falsified and spurious documents in the
pursuit of their nefarious activities pursuant to the instant case filed before
this Court. Let the corresponding Warrants of Arrest be issued against the
aforesaid respondents who should serve ten (10) days of detention at the
Dasmariñas Municipal Jail, Cavite.
Likewise, the title issued to Sharcons Builders Philippines, Inc., under TCT
No. T-511462 allegedly issued on November 11, 1994, being spurious, is
hereby cancelled, it having been derived from another spurious title with
TCT No. T-278479 allegedly issued to Evanswinda C. Morales on
December 29, 1989. The Declaration of Real Property No. 4736 is likewise
hereby cancelled for being spurious. Let a copy of this Order be forwarded
to the Registry of Deeds for its implementation with respect to the two (2)
titles for cancellation and to the Assessor’s Office of the Municipality of
Dasmariñas, Cavite, to stave off the proliferation of these spurious
instruments.
WHEREFORE, in view of the foregoing, the instant case is DISMISSED
WITH PREJUDICE, whereas, the private defendant’s counterclaims, which
need further substantiation, are likewise dismissed. However, the said
private defendants are not precluded from pursuing their rightful course(s)
of action in the interest of justice.
SO ORDERED.
Petitioner stated that in determining the merits of Sharcons' complaint for quieting
of title, she "stumbled" upon Civil Case No. 623-92 for cancellation of title and
damages filed with the RTC, Branch 20, Imus, Cavite, presided by then Judge
Lucenito N. Tagle.2 Petitioner then took judicial notice of the judge’s Decision
declaring that Sharcons' TCT and other supporting documents are falsified and
that respondents are responsible therefor.
On July 12, 2001, petitioner issued warrants of arrest against respondents. They
were confined in the municipal jail of Dasmariñas, Cavite. That same day,
respondents filed a motion for bail and a motion to lift the order of arrest. But they
were denied outright by petitioner.
Respondents then filed with the Court of Appeals a petition for a writ of habeas
corpus, docketed as CA-G.R. SP No. 65652. On July 19, 2001, the Court of
Appeals granted the petition.
Page 491 of 507
Cases – Special Civil Actions (Part 1)
On September 12, 2001, the Court of Appeals promulgated its Decision, the
dispositive portion of which reads:
IN THE LIGHT OF ALL THE FOREGOING, finding the instant petition to
be meritorious, the same is hereby GRANTED. Respondent judge’s July 9,
2001 Order, insofar as it declared herein petitioners in direct contempt and
ordered their incarceration for ten (10) days, as well as the Warrant of
Arrest, dated July 12, 2001, and the Order of Commitment, dated July 13,
2001, which the respondent judge issued against the persons of the herein
petitioners, are hereby NULLIFIED and SET ASIDE.
SO ORDERED.
The Court of Appeals ruled that Judge Español erred in taking cognizance of the
Decision rendered by then Judge Tagle in Civil Case No. 623-92 since it was not
offered in evidence in Civil Case No. 2035-00 for quieting of title. Moreover, as the
direct contempt of court is criminal in nature, petitioner should have conducted a
hearing. Thus, she could have determined whether respondents are guilty as
charged.
Petitioner filed a motion for reconsideration but the Court of Appeals denied the
same in its Resolution of November 15, 2001.
Hence, this petition.
The basic question before us is whether petitioner erred in ruling that respondents
are guilty of direct contempt of court for using falsified documents when Sharcons
filed its complaint for quieting of title.
The early case of In re Jones3 defined contempt of court as "some act or conduct
which tends to interfere with the business of the court, by a refusal to obey some
lawful order of the court, or some act of disrespect to the dignity of the court which
in some way tends to interfere with or hamper the orderly proceedings of the court
and thus lessens the general efficiency of the same." It has also been described as
"a defiance of the authority, justice or dignity of the court; such conduct as tends to
bring the authority and administration of the law into disrespect or to interfere with
or prejudice parties litigants or their witnesses during litigation."4 Simply put, it is
despising of the authority, justice, or dignity of the court. 5
The offense of contempt traces its origin to that time in England when all courts in
the realm were but divisions of the Curia Regia, the supreme court of the monarch,
and to scandalize a court was an affront to the sovereign.6 This concept was
adopted by the Americans and brought to our shores with modifications. In this
jurisdiction, it is now recognized that courts have the inherent power to
punish for contempt on the ground that respect for the courts guarantees
the very stability of the judicial institution.7 Such stability is essential to the
preservation of order in judicial proceedings, to the enforcement of judgments,
orders, and mandates of the courts, and, consequently, to the very administration
of justice.8
Rule 71 of the 1997 Rules of Civil Procedure, as amended, provides:
SEC. 1. Direct contempt punished summarily. – A person guilty of
misbehavior in the presence of or so near a court as to obstruct or
interrupt the proceedings before the same, including disrespect toward the
court, offensive personalities toward others, or refusal to be sworn or to
answer as a witness, or to subscribe an affidavit or deposition when
lawfully required to do so, may be summarily adjudged in contempt by
such court and punished by a fine not exceeding two thousand pesos or
imprisonment not exceeding ten (10) days, or both, if it be a Regional Trial
Court or a court of equivalent or higher rank, or by a fine not exceeding
two hundred pesos or imprisonment, not exceeding one (1) day, or both, if
it be a lower court.
In Narcida v. Bowen,9 this Court characterized direct contempt as one done "in the
presence of or so near the court or judge as to obstruct the administration of
justice." It is a contumacious act done facie curiae and may be punished
summarily without hearing.10 In other words, one may be summarily adjudged in
direct contempt at the very moment or at the very instance of the commission of
the act of contumely.
Section 3, Rule 71 of the same Rules states:
SEC. 3. Indirect contempt to be punished after charge and hearing. – After
a charge in writing has been filed and an opportunity given to the
respondent to comment thereon within such period as may be fixed by the
court and to be heard by himself or by counsel, a person guilty of any of
the following acts may be punished for indirect contempt:
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 (a) Misbehavior of an officer of court in the performance of his official
duties or in his official transactions;
(b) Disobedience of or resistance to a lawful writ, process, order, or
judgment of a court, including the act of a person who, after being
dispossessed or ejected from any real property by the judgment or
process of any court of competent jurisdiction, enters or attempts or
induces another to enter into or upon such real property, for the purpose of
executing acts of ownership or possession, or in any manner disturbs the
possession given to the person adjudged to be entitled thereto;
(c) Any abuse of or any unlawful interference with the processes or
proceedings of a court not constituting direct contempt under Section 1 of
this Rule;
(d) Any improper conduct tending, directly or indirectly, to impede,
obstruct, or degrade the administration of justice;
(e) Assuming to be an attorney or an officer of a court and acting as such
without authority;
(f) Failure to obey a subpoena duly served;
(g) The rescue, or attempted rescue, of a person or property in the custody
of an officer by virtue of an order or process of a court held by him.
But nothing in this section shall be so construed as to prevent the court
from issuing process to bring the respondent into court, or from holding
him in custody pending such proceedings.
Indirect or constructive contempt, in turn, is one perpetrated outside of the sitting of
the court and may include misbehavior of an officer of a court in the performance
of his official duties or in his official transactions, disobedience of or resistance to a
lawful writ, process, order, judgment, or command of a court, or injunction granted
by a court or a judge, any abuse or any unlawful interference with the process or
proceedings of a court not constituting direct contempt, or any improper conduct
tending directly or indirectly to impede, obstruct or degrade the administration of
justice.11
We agree with petitioner that the use of falsified and forged documents is a
contumacious act. However, it constitutes indirect contempt not direct contempt.
Pursuant to the above provision, such act is an improper conduct which degrades
the administration of justice. In Santos v. Court of First Instance of Cebu, Branch
VI,12 we ruled that the imputed use of a falsified document, more so where the
falsity of the document is not apparent on its face, merely constitutes indirect
contempt, and as such is subject to such defenses as the accused may raise in
the proper proceedings. Thus, following Section 3, Rule 71, a contemner may be
punished only after a charge in writing has been filed, and an opportunity has been
given to the accused to be heard by himself and counsel.13 Moreover, settled is the
rule that a contempt proceeding is not a civil action, but a separate proceeding of a
criminal nature in which the court exercises limited jurisdiction. 14 Thus, the modes
of procedure and the rules of evidence in contempt proceedings are assimilated as
far as practicable to those adapted to criminal prosecutions.15 Perforce, petitioner
judge erred in declaring summarily that respondents are guilty of direct contempt
and ordering their incarceration. She should have conducted a hearing with notice
to respondents.
Petitioner, in convicting respondents for direct contempt of court, took judicial
notice of the Decision in Civil Case No. 623-92, assigned to another RTC branch,
presided by then Judge Tagle. Section 1, Rule 129 of the Revised Rules of Court
provides:
SEC. 1. Judicial notice, when mandatory. – A court shall take judicial
notice, without the introduction of evidence, of the existence and territorial
extent of states, their political history, forms of government, and symbols
of nationality, the law of nations, the admiralty and maritime courts of the
world and their seals, the political constitution and history of the
Philippines, the official acts of the legislative, executive and judicial
departments of the Philippines, the laws of nature, the measure of time,
and the geographical divisions.
In Gener v. De Leon,16 we held that courts are not authorized to take judicial notice
of the contents of records of other cases even when such cases have been tried or
pending in the same court. Hence, we reiterate that petitioner took judicial notice of
the Decision rendered by another RTC branch and on the basis thereof, concluded
that respondents used falsified documents (such as land title and tax declaration)
when Sharcons filed its complaint for quieting. Verily, the Court of Appeals did not
err in ruling that respondents are not guilty of direct contempt of court.
Page 493 of 507
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Meanwhile, the instant petition challenging the Decision of the Court of Appeals
granting the writ of habeas corpusin favor of respondents has become moot. We
recall that respondents were released after posting the required bail as ordered by
the Court of Appeals. A writ of habeas corpus will not lie on behalf of a person who
is not actually restrained of his liberty. And a person discharged on bail is not
restrained of his liberty as to be entitled to a writ of habeas corpus.17
WHEREFORE, we DENY the petition. The challenged Decision and Resolution of
the Court of Appeals in CA-G.R. SP No. 65652 are AFFIRMED. No costs.
SO ORDERED.
G.R. No. 205956 February 12, 2014
P/SUPT. HANSEL M. MARANTAN, Petitioner,
vs.
ATTY. JOSE MANUEL DIOKNO and MONIQUE CU-UNJIENG
LA'O, Respondents.
RESOLUTION
MENDOZA, J.:
Before the Court is a petition to cite respondents in contempt of Court.
Petitioner P/Supt. Hansel M. Marantan (Marantan) is the respondent in G.R. No.
199462,1 a petition filed on December 6, 2011, but already dismissed although the
disposition is not yet final. Respondent Monique Cu-Unjieng La'O (La ‘O) is one of
the petitioners in the said case, while respondent Atty. Jose Manuel Diokno (Atty.
Diokno) is her counsel therein.
G.R. No. 199462 relates to Criminal Case Nos. 146413-PSG, 146414-PSG and
146415-PSG, entitled "People of the Philippines v. P/SINSP Hansel M. Marantan,
et al.," pending before the Regional Trial Court of Pasig City, Branch 265 (RTC),
where Marantan and his co-accused are charged with homicide. The criminal
cases involve an incident which transpired on November 7, 2005, where Anton Cu-
Unjieng (son of respondent La’O), Francis Xavier Manzano, and Brian Anthony
Dulay, were shot and killed by police officers in front of the AIC Gold Tower at
Ortigas Center, which incident was captured by a television crew from UNTV 37
(Ortigas incident).
In G.R. No. 199462, La’O, together with the other petitioners, prayed, among
others, that the resolution of the Office of the Ombudsman downgrading the
charges from murder to homicide be annulled and set aside; that the
corresponding informations for homicide be withdrawn; and that charges for
murder be filed.
In the meantime, on January 6, 2013, a shooting incident occurred in Barangay
Lumutan, Municipality of Atimonan, Province of Quezon, where Marantan was the
ground commander in a police-military team, which resulted in the death of thirteen
(13) men (Atimonan incident). This encounter, according to Marantan, elicited
much negative publicity for him.
Marantan alleges that, riding on the unpopularity of the Atimonan incident, La’O
and her counsel, Atty. Diokno, and one Ernesto Manzano, organized and
conducted a televised/radio broadcasted press conference. During the press
conference, they maliciously made intemperate and unreasonable comments on
the conduct of the Court in handling G.R. No. 199462, as well as contumacious
comments on the merits of the criminal cases before the RTC, branding Marantan
and his co-accused guilty of murder in the Ortigas incident.
On January 29, 2013, this interview was featured in "TV Patrol," an ABS-CBN
news program. Marantan quotes2 a portion of the interview, as follows:
Atty. Diokno
So ang lumabas din sa video that the actual raw footage of the UNTV is very long.
Ang nangyari, you see the police officers may nilalagay sila sa loob ng sasakyan
ng victims na parang pinapalabas nila that there was a shootout pero ang nangyari
na yon e tapos na, patay na.
Ernesto Manzano
Kung sinasabi nilang carnapper dapat huliin nilang buhay yong mga mahal naming
sa buhay and kinasuhan pero ang ginawa nila, sila mismo na ang nagbigay ng
hatol.
Page 494 of 507
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Monique Cu-Unjieng La’o
Sinasabi nila na may kinarnap siya, tinutukan ng baril, hindi magagawa yong kasi
kilala ko siya, anak ko yon e x x x he is already so arrogant because they
protected him all these years. They let him get away with it. So even now, so
confident of what he did, I mean confident of murdering so many innocent
individuals.
Atty. Diokno
Despite the overwhelming evidence, however, Supt. Marantan and company have
never been disciplined, suspended or jailed for their participation in the Ortigas
rubout, instead they were commended by their superiors and some like Marantan
were even promoted to our consternation and disgust. Ang problema po e
hangang ngayon, we filed a Petition in the Supreme Court December 6, 2011,
humihingi po kami noon ng Temporary Restraining Order, etc. – hangang ngayon
wala pa pong action ang Supreme Court yong charge kung tama ba yong pag
charge ng homicide lamang e subalit kitang kita naman na they were killed
indiscriminately and maliciously.
Atty. Diokno
Eight years have passed since our love ones were murdered, but the policemen
who killed them led by Supt. Hansel Marantan the same man who is involved in
the Atimonan killings – still roam free and remain unpunished. Mr. President, while
we are just humble citizens, we firmly believe that police rub-out will not stop until
you personally intervene.
Ernesto Manzano
Up to this date, we are still praying for justice.
Monique Cu-Unjieng La’o
Ilalaban namin ito no matter what it takes, we have the evidence with us, I mean
everything shows that they were murdered.
(Emphasis supplied by petitioner)
Marantan submits that the respondents violated the sub judice rule, making them
liable for indirect contempt under Section 3(d) of Rule 71 of the Rules of Court, for
their contemptuous statements and improper conduct tending directly or indirectly
to impede, obstruct or degrade the administration of justice. He argues that their
pronouncements and malicious comments delved not only on the supposed
inaction of the Court in resolving the petitions filed, but also on the merits of the
criminal cases before the RTC and prematurely concluded that he and his co-
accused are guilty of murder. It is Maranta’s position that the press conference
was organized by the respondents for the sole purpose of influencing the decision
of the Court in the petition filed before it and the outcome of the criminal cases
before the RTC by drawing an ostensible parallelism between the Ortigas incident
and the Atimonan incident.
The respondents, in their Comment,3 argue that there was no violation of the sub
judice rule as their statements were legitimate expressions of their desires, hopes
and opinions which were taken out of context and did not actually impede, obstruct
or degrade the administration of justice in a concrete way; that no criminal intent
was shown as the utterances were not on their face actionable being a fair
comment of a matter of public interest and concern; and that this petition is
intended to stifle legitimate speech.
The petition must fail.
The sub judice rule restricts comments and disclosures pertaining to the judicial
proceedings in order to avoid prejudging the issue, influencing the court, or
obstructing the administration of justice. A violation of this rule may render one
liable for indirect contempt under Sec. 3(d), Rule 71 of the Rules of Court, 4 which
reads:
Section 3. Indirect contempt to be punished after charge and hearing. – x x x a
person guilty of any of the following acts may be punished for indirect contempt:
xxx
(d) Any improper conduct tending, directly or indirectly, to impede, obstruct, or
degrade the administration of justice[.]
The proceedings for punishment of indirect contempt are criminal in nature. 5 This
form of contempt is conduct that is directed against the dignity and authority of the
court or a judge acting judicially; it is an act obstructing the administration of justice
Page 495 of 507
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which tends to bring the court into disrepute or disrespect. Intent is a necessary
element in criminal contempt, and no one can be punished for a criminal contempt
unless the evidence makes it clear that he intended to commit it. 6
For a comment to be considered as contempt of court "it must really appear" that
such does impede, interfere with and embarrass the administration of
justice.7 What is, thus, sought to be protected is the all-important duty of the court
to administer justice in the decision of a pending case. 8 The specific rationale for
the sub judice rule is that courts, in the decision of issues of fact and law should be
immune from every extraneous influence; that facts should be decided upon
evidence produced in court; and that the determination of such facts should be
uninfluenced by bias, prejudice or sympathies.91âwphi1
The power of contempt is inherent in all courts in order to allow them to conduct
their business unhampered by publications and comments which tend to impair the
impartiality of their decisions or otherwise obstruct the administration of justice. As
important as the maintenance of freedom of speech, is the maintenance of the
independence of the Judiciary. The "clear and present danger" rule may serve as
an aid in determining the proper constitutional boundary between these two
rights.10
The "clear and present danger" rule means that the evil consequence of the
comment must be "extremely serious and the degree of imminence extremely
high" before an utterance can be punished. There must exist a clear and present
danger that the utterance will harm the administration of justice. Freedom of
speech should not be impaired through the exercise of the power of contempt of
court unless there is no doubt that the utterances in question make a serious and
imminent threat to the administration of justice. It must constitute an imminent, not
merely a likely, threat.11
The contemptuous statements made by the respondents allegedly relate to the
merits of the case, particularly the guilt of petitioner, and the conduct of the Court
as to its failure to decide G.R. No. 199462.
As to the merits, the comments seem to be what the respondents claim to be an
expression of their opinion that their loved ones were murdered by Marantan. This
is merely a reiteration of their position in G.R. No. 199462, which precisely calls
the Court to upgrade the charges from homicide to murder. The Court detects no
malice on the face of the said statements. The mere restatement of their argument
in their petition cannot actually, or does not even tend to, influence the Court.
As to the conduct of the Court, a review of the respondents' comments reveals that
they were simply stating that it had not yet resolved their petition. There was no
complaint, express or implied, that an inordinate amount of time had passed since
the petition was filed without any action from the Court. There appears no attack or
insult on the dignity of the Court either.
"A public utterance or publication is not to be denied the constitutional protection of
freedom of speech and press merely because it concerns a judicial proceeding still
pending in the cou1is, upon the theory that in such a case, it must necessarily tend
to obstruct the orderly and fair administration of justice."12 By no stretch of the
imagination could the respondents' comments pose a serious and imminent threat
to the administration of justice. No criminal intent to impede, obstruct, or degrade
the administration of justice can be inferred from the comments of the
respondents.
Freedom of public comment should, in borderline instances, weigh heavily against
a possible tendency to influence pending cases.13 The power to punish for
contempt, being drastic and extraordinary in its nature, should not be resorted to
unless necessary in the interest of justice.14 In the present case, such necessity is
wanting.
WHEREFORE, the petition is DISMISSED.
SO ORDERED.
A.M. No. RTJ-13-2366 February 4, 2015
[Formerly OCA IPI No. 11-3740-RTJ]
JILL M. TORMIS, Complainant,
vs.
JUDGE MEINRADO P. PAREDES, Respondent.
DECISION
MENDOZA, J.:
Page 496 of 507
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For consideration is the Report and Recommendation1 of Justice Maria Elisa
Sempio Diy (Justice Diy), Court of Appeals, Cebu City, submitted to this Court
pursuant to its January 14, 2013 Resolution, 2 referring the complaint filed by Jill M.
Tormis (Jill) against respondent Judge Meinrado P. Paredes (Judge Paredes),
Presiding Judge, Branch 13, Regional Trial Court (RTC), Cebu City, for
investigation, report and recommendation.
The Facts
In her Affidavit/Complaint,3 dated September 5, 2011, Jill charged Judge Paredes
with grave misconduct. Jill was a student of Judge Paredes in Political Law Review
during the first semester of school year 2010-2011 at the Southwestern University,
Cebu City. She averred that sometime in August 2010, in his class discussions,
Judge Paredes named her mother, Judge Rosabella Tormis (Judge Tormis),then
Presiding Judge of Branch 4, Municipal Trial Court in Cities (MTCC),Cebu City, as
one of the judges involved in the marriage scams in Cebu City. Judge Paredes
also mentioned in his class that Judge Tormis was abusive of her position as a
judge, corrupt, and ignorant of the law.
Jill added that Judge Paredes included Judge Tormis in his discussions not only
once but several times. In one session, Judge Paredes was even said to have
included in his discussion Francis Mondragon Tormis (Francis),son of Judge
Tormis, stating that he was a "court-noted addict."4 She was absent from class at
that time, but one of her classmates who was present, Rhoda L. Litang (Rhoda),
informed her about the inclusion of her brother. To avoid humiliation in school, Jill
decided to drop the class under Judge Paredes and transfer to another law school
in Tacloban City.
Jill also disclosed thatin the case entitled "Trinidad O. Lachica v. Judge
Tormis"5 (Lachica v. Tormis), her mother was suspended from the service for six
(6) months for allegedly receiving payment of a cash bail bond for the temporary
release of an accused for the warrant she had issued in a case then pending
before her sala. Judge Paredes was the one who reviewed the findings conducted
therein and he recommended that the penalty be reduced to severe reprimand.
Jill, however, claimed that Judge Paredes committed an offense worse than that
committed by her mother. She averred that on March 13, 2011, Judge Paredes
accepted a cash bail bond in the amount of Six Thousand Pesos (₱6,000.00) for
the temporary release of one Lita Guioguio in a case entitled, "People of the
Philippines v. Lita Guioguio,"docketed as Criminal Case No. 148434-R,6 then
pending before Branch 8, MTCC, Cebu City (Guioguio case).
Thus, she prayed that Judge Paredes be administratively sanctioned for his
actuations.
Comment of Judge Paredes
In his Comment,7 dated October 28, 2011, Judge Paredes denied the accusations
of Jill. He stated thatJudge Tormis had several administrative cases, some of
which he had investigated; that as a result of the investigations, he recommended
sanctionsagainst Judge Tormis; that Judge Tormis used Jill, her daughter, to get
back at him; that he discussed in his class the case of Lachica v. Tormis, but never
Judge Tormis’ involvement in the marriage scams nor her sanctions as a result of
the investigation conducted by the Court; that he never personally attacked Judge
Tormis’ dignity and credibility; that the marriage scams in Cebu City constituted a
negative experience for all the judges and should be discussed so that other
judges, court employees and aspiring lawyers would not emulate such misdeeds;
that the marriage scams werealso discussed during meetings of RTC judges and
in schools where remediallaw and legal ethics were taught; that he talked about
past and resolvedcases, but not the negative tendencies of Judge Tormis; that
there was nothing wrong in discussing the administrative cases involving Judge
Tormis because these cases were known to the legal community and some were
even published in the Supreme Court Reports Annotated (SCRA) and other legal
publications; and that when he was the executive judge tasked to investigate
Judge Tormis, he told her to mend her ways, butshe resented his advice.
Judge Paredes further stated that when Jill was still his student, she did not
complain about or dispute his discussions in class regarding the administrative
liabilities of her mother; that the matter was not also brought to the attention of the
Dean of Southwestern University or of the local authorities; that he admitted saying
that Judge Tormis had a son named Francis who was a drug addict and thatdrug
dependents had no place in the judiciary; and that he suggested thatFrancis
should be removed from the judiciary.
He denied, however, having stated that Francis was appointed as court employee
as a result of the influence of Judge Tormis. She is not an influential person and it
is the Supreme Court who determines the persons to be appointed as court
employees. JudgeTormis, however, allowed her drug dependent son to apply for a
position in the judiciary.
Page 497 of 507
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Regarding the specific act being complained of, Judge Paredes admitted that he
personally accepted a cash bail bond of 6,000.00 for the temporary release of Lita
Guioguio onMarch 13, 2011. He claimed though that the approval of the bail bond
was in accordance with Section 14, Chapter 5 of A.M. No. 03-8-62-SC which
allowed executive judges to act on petitions for bail and other urgent matters on
weekends, official holidays and special days. Judge Paredes explained that he
merely followed the procedure. As Executive Judge, he issued a temporary receipt
and on the following business day, a Monday, he instructed the Branch Clerk of
Court to remit the cash bond to the Clerk of Court. The Clerk of Court
acknowledged the receipt of the cash bond and issued an official receipt. It was
not his fault that the Clerk of Court acknowledged the receipt of the cash bond only
in the afternoon of March 21, 2011.
Lastly, Judge Paredes averred thatthe discussions relative to the administrative
cases of Judge Tormiscould not be the subject of an administrative complaint
because it was not done in the performance of his judicial duties.
Reply of the Complainant
In her Verified-Reply,8 dated November 23, 2011, Jill countered that her mother
had nothing to do with the filing of the present complaint; that she was forced to
leave her family in Cebu City to continue her law studies elsewhere because she
could no longer bear the discriminating and judgmental eyes of her classmates
brought about by Judge Paredes’ frequent discussions in class of her mother’s
administrative cases; that her mother was indeed one of the judges implicated in
the marriage scams, but when Judge Paredes discussed the matter in his classes,
the case of her mother was not yet resolved by the Court and, thus, in 2010, it was
still premature; and that Judge Paredes was aware that administrative cases were
confidential in nature.
Jill claimed that the intention to humiliate her family was evident when Judge
Paredes branded her brother, Francis, as a "drug addict."
Rejoinder of Judge Paredes
In his Rejoinder,9 dated December 2, 2011, Judge Paredes asserted that it was
not premature to discuss the marriage scams in class because the scandal was
already disclosed by Atty. Rullyn Garcia and was also written in many legal
publications, and that the drug addiction of Francis was known in the Palace of
Justice of Cebu City.
In its Report,10 dated September 12, 2012, the Office of the Court Administrator
(OCA) stated that the conflicting allegations by the parties presented factual issues
that could not be resolved based on the evidence on record then. Considering the
gravity and the sensitive natureof the charges, a full-blown investigation should be
conducted by the CA.
On January 14, 2013, pursuant tothe recommendation of the OCA, the Court
referred the administrative complaint to the Executive Justice of the CA, Cebu
Station, for investigation, report and recommendation within sixty (60) days from
receipt of the records.11
On March 26, 2013, the case was raffled to, and the records were received by,
Justice Diy. Thereafter, the appropriate notices were issued and the confidential
hearings were conducted. Afterwards, Justice Diy received the respective
memoranda of the parties.
In her memorandum,12 Jill contended that Judge Paredes’ act of discussing Judge
Tormis’ cases in class where she was present was an open display of insensitivity,
impropriety and lack of delicadezabordering on oppressive and abusive conduct,
which fell short of the exacting standards of behavior demanded of magistrates.
She asserted that the defense of Judge Paredes that he could not be made
administratively liable as the act was not made in the performance of his official
duties did not hold water because a judge should be the embodiment of whatwas
just and fair not only in the performance of his official duties but also in his
everyday life.
Jill also averred that Judge Paredes violated the subjudicerule when he discussed
the marriage scam involving Judge Tormis in 2010 because at that time, the case
was still being investigated; that the administrative case relative to the marriage
scam was decided only on April 2, 2013; that Judge Paredes was not the
Executive Judge ofthe MTCC when he received the cash bail bond in the
Guiguiocase; that he could not prove that the executive judge of the MTCC was
unavailable before accepting the cash bail bond; and that the assertion of Judge
Paredes of his being an anti-corruption judge and a lone nominee of the IBP Cebu
City Chapter to the Foundation of Judicial Excellence did not exculpate him from
committing the acts complained of. In his Reply-Memorandum,13 Judge Paredes
reiterated the allegations contained in his previous pleadings. He added that the
marriage scams scandalized the Judiciary and became public knowledge when
Atty. Rullyn Garcia of the OCA held a press conference on the matter; that, hence,
every citizen, including him, may comment thereon; that in the hierarchy of rights,
Page 498 of 507
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freedom of speech and expression ranked high; that Judge Tormis never
intervened in the present case; that ifhe indeed made derogatory remarks against
Judge Tormis, she should havefiled a criminal action for oral defamation; and that
calling for the ouster of drug addicts could not be considered an abuse, but was
meant for the protection of the Judiciary.14
In her Report and Recommendation, Justice Diy found Judge Paredes guilty of
conduct unbecoming of a judge. She opined that his use of intemperate language
during class discussions was inappropriate. His statements in class, tending to
project Judge Tormis as corrupt and ignorant of the laws and procedure, were
obviously and clearly insensitive and inexcusable.
Justice Diy disregarded the defense of Judge Paredes that his discussions of the
administrative case of Judge Tormis in class was an exercise of his right to
freedom of expression. She cited the New Code of Judicial Conduct for the
Philippine Judiciary15 which urged members of the Judiciary to be models of
propriety at all times. She quoted with emphasis Section 6 which stated that
"Judges, like any other citizen, are entitled to freedom of expression, belief,
association and assembly, but in exercising such rights, they shall always conduct
themselves in such a manner as to preserve the dignity of the judicial office and
the impartiality and independence of the judiciary."16
Justice Diy likewise rejected Judge Paredes’ position that he could not be held
administratively liable for his comments against Judge Tormis and Francis as
these were uttered while he was not in the exercise of his judicial functions.
Jurisprudence,17 as well as the New Code of Judicial Conduct, required that he
conduct himself beyond reproach, not only in the discharge of his judicial functions,
but also inhis other professional endeavors and everyday activities.
Justice Diy found merit in Jill’s allegation that Judge Paredes violated the
subjudicerule when the latter discussed the marriage scams involving Judge
Tormis in 2010 when the said issue was still being investigated. She cited, as
basis for JudgeParedes’ liability, Section 4, Canon 3 of the New Code of Judicial
Conduct.
As regards Judge Paredes’ receipt of the cash bail bond in relation to the
Guioguiocase, Justice Diy absolved him ofany liability as the charge of grave
misconduct was not supported by sufficient evidence. She accepted Judge
Paredes’ explanation that he merely followed the procedure laid down in Section
14, Chapter 5 of A.M. No. 03-8-02-SC when he approved the bail bond.
Based on these findings, Justice Diy came up with the following recommendations,
thus:
The undersigned Investigating Justice finds that indeed Judge Paredes is guilty of
conduct unbecoming of a judge. Conduct unbecoming of a judge is classified as a
light offense under Section 10, Rule 140 of the Revised Rules of Court, penalized
under Section 11 (c) thereof by any of the following: (1) a Fine of not less than
₱1,000.00 but not exceeding ₱10,000.00; (2) Censure; (3) Reprimand; and (4)
Admonition with warning.
Inasmuch as this is Judge Paredes’ first offense and considering the factual milieu
and the peculiar circumstances attendant thereto, it is respectfully recommended
that Judge Paredes be meted out with the penalty of REPRIMAND with a warning
that a repetition of the same or a similar offense will be dealt with more severely.18
The Court’s Ruling
The Court adopts the findings and recommendations of Justice Diy except as to
the penalty.
Misconduct is defined as a transgression of some established and definite rule of
action, more particularly, unlawful behavior or gross negligence by a public officer.
The misconduct is grave if it involves any of the additional elements of corruption,
willful intent to violate the law, or to disregard established rules, which must be
established by substantial evidence. As distinguished from simple misconduct, the
elements of corruption, clear intent to violate the law, or flagrant disregard of
established rule, must be manifest in a charge of grave misconduct. Corruption, as
an element of grave misconduct, consists in the act of an official or fiduciary
person who unlawfully and wrongfully uses his station or character to procure
some benefit for himself or for another person, contrary to duty and the rights of
others.19
To constitute misconduct, the act or acts must have a direct relation to and be
connected with the performance of his official duties.20 Considering that the acts
complained of, the remarks against Judge Tormis and Francis, were made by
Judge Paredes in his class discussions, they cannot be considered as
"misconduct." They are simply not related to the discharge of his official functions
as a judge. Thus, Judge Paredes cannot be held liable for misconduct, much less
for grave misconduct.
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Discussion of a subjudicematter, however, is another thing.
On subjudice matters, Section 4, Canon 3 ofthe New Code of Judicial Conduct
provides: CANON 3
IMPARTIALITY
SEC. 4. Judges shall not knowingly, while a proceeding is before or could come
before them, make any comment that might reasonably be expected to affect the
outcome of such proceeding or impair the manifest fairness of the process. Nor
shall judges make any comment in public or otherwise that might affect the fair trial
of any person or issue. (Emphasis supplied)
The subjudice rule restricts comments and disclosures pertaining to the judicial
proceedings in order to avoid prejudging the issue, influencing the court, or
obstructing the administration of justice.21 The rationale for the rule was spelled out
in Nestle Philippines, Inc. v. Sanchez,22 where it was stated that it is a traditional
conviction of civilized society everywhere that courts and juries, in the decision of
issues of fact and law should be immune from every extraneous influence;
thatfacts should be decided upon evidence produced in court; and that the
determination of such facts should be uninfluenced by bias, prejudice or
sympathies.23 Notably, when Judge Paredes discussed the marriage scams
involving Judge Tormis in 2010, the investigation relative to the said case had not
yet been concluded. In fact, the decision on the case was promulgated by the
Court only on April 2, 2013.24In 2010, he still could not make comments on the
administrative case to prevent any undue influence in its resolution. Commenting
on the marriage scams, where Judge Tormis was one of the judges involved, was
in contravention of the subjudicerule. Justice Diy was, therefore, correct in finding
that Judge Paredes violated Section 4, Canon 3 of the New Code of Judicial
Conduct.
The Court shares the view of Justice Diy that although the reasons of Judge
Paredes for discussing the marriage scams in his classes seemed noble, his
objectives were carried out insensitively and in bad taste. The pendency of the
administrative case of Judge Tormis and the publicity of the marriage scams did
not give Judge Paredes unrestrained license to criticize Judge Tormis in his class
discussions. The publicity given to the investigation of the said scams and the fact
that it was widely discussed in legal circles let people expressed critical opinions
on the issue. There was no need for Judge Paredes to "rub salt to the wound," 25 as
Justice Diy put it.
Judge Paredes in using intemperate language and unnecessary comments
tending to project Judge Tormisas a corrupt and ignorant judge in his class
discussions, was correctly found guilty of conduct unbecoming of a judge by
Justice Dy.
Indeed, the New Code of Judicial Conduct for the Philippine Judiciary requires
judges to exemplify propriety at all times. Canon 4 instructs:
CANON 4
PROPRIETY
SEC. 1. Judges shall avoid impropriety and the appearance of impropriety in all of
their activities.
xxx
SEC. 2. As a subject of constant public scrutiny, judges must accept personal
restrictions that might be viewed as burdensome by the ordinary citizen and should
do so freely and willingly. In particular, judges shall conduct themselves in a way
that is consistent with the dignity of the judicial office.
A judge should always conduct himself in a manner that would preserve the
dignity, independence and respect for himself, the Court and the Judiciary as a
whole. He must exhibit the hallmark judicial temperament of utmost sobriety and
self-restraint. Heshould choose his words and exercise more caution and control
inexpressing himself. In other words, a judge should possess the virtue of gravitas.
Furthermore, a magistrate should not descend to the level of a sharp-tongued, ill-
mannered petty tyrant by uttering harsh words, snide remarks and sarcastic
comments. He is required to always be temperate, patient and courteous, both in
conduct and in language.26
In this case, records show that Judge Paredes failed to observe the propriety
required by the Code and to use temperate and courteous language befitting a
magistrate. Indeed, Judge Paredes demonstrated conduct unbecoming of a judge.
When Judge Paredes failed to restrain himself and included Francis, whose
condition and personal circumstances, as properly observed by Justice Diy, had no
relevance to the topic that was then being discussed in class, it strongly indicated
his intention to taint their reputations.
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The inclusion of Judge Tormis and Francis in his class discussions was never
denied by Judge Paredes who merely justified his action by invoking his right to
freedom of expression. Section 6, Canon 4 of the New Code of Judicial Conduct
recognizes that judges, like any other citizen, are entitled to freedom of expression.
Such right, however, is not without limitation. Section 6, Canon 4 of the Code also
imposes a correlative restriction on judges: in the exercise of their freedom of
expression, they should always conduct themselves in a manner that preserves
the dignity of the judicial office and the impartiality and independence of the
Judiciary. In the exercise of his right to freedomof expression, Judge Paredes
should uphold the good image of the Judiciary ofwhich he is a part. He should
have avoided unnecessary and uncalled for remarks in his discussions and should
have been more circumspect inhis language. Beinga judge, he is expected to act
with greater circumspection and to speak with self-restraint. Verily, Judge Paredes
fell short of this standard.
The Court cannot sustain the assertion of Judge Paredes that he cannot be held
administratively liable for his negative portrayal of Judge Tormis and Francis in his
class discussions. Judge Paredes should be reminded of the ethical conduct
expected of him asa judge not only in the performance of his judicial duties, but in
his professional and private activities as well. Sections 1 and 2, Canon 2 of the
Code mandates:
CANON 2
INTEGRITY
Integrity is essential not only to the proper discharge of the judicial office but also
to the personal demeanor of judges.
SECTION 1. Judges shall ensure thatnot only is their conduct above reproach, but
that it is perceived to be so in the view of a reasonable observer.
SECTION 2. The behavior and conduct of judges must reaffirm the people’s faith
in the integrity of the judiciary.1âwphi1Justice must not merely be done but must
also be seen to be done. (Emphases supplied)
Any impropriety on the part of Judge Paredes, whether committed in or out of the
court, should not be tolerated for he is not a judge only occasionally. It should be
emphasized that the Code of Judicial Ethics mandates that the conduct of a judge
mustbe free of a whiff of impropriety not only with respect to his performance of his
judicial duties, but also to his behavior outside his salaand as a private individual.
There is no dichotomy of morality, a public official is also judged by his private
morals. The Code dictates that a judge, in order to promote public confidence in
the integrity and impartiality of the judiciary, must behave with propriety at all
times. A judge’s official life cannot simply be detached or separated from his
personal existence. Thus, being a subject of constant public scrutiny, a judge
should freely and willingly accept restrictions on conduct that might be viewed as
burdensome by the ordinary citizen. He should personify judicial integrity and
exemplify honest public service. The personal behavior of a judge, both in the
performance of official duties and in private life should be above suspicion.27
Regarding the act of receiving the cash bail bond in the Guioguio case,Justice Diy
correctly found that it cannot be regarded as grave misconduct. The Court
findsmerit in the position of Judge Paredes that the approval, as well as the
receipt, ofthe cash bail bond, was in accordance with the rules. Thus:
Finally, the Investigating Officer disagrees with Jill’s allegation that Judge Paredes
committed grave misconduct when he personally received cash bailbond in
relation to the Guioguio case. Judge Paredes justified his action by stating that he
was merely following the procedure set forth in Section 14, Chapter 5 of A.M. No.
03-02-SC, which authorizes executive judges to act on petitions for bail on
Saturdays after 1:00 o’clock in the afternoon, Sundays, official holidays, and
special days. Said rule also provides that should the accused deposit cash bail, the
executive judge shall acknowledge receipt of the cash bail bond in writing and
issue a temporary receipt therefor. Considering that Judge Paredes merely
followed said procedure, he cannot beheld administratively liable for his act of
receiving the cash bail bond in the Guioguio case.
Moreover, respondent judge is authorized to receive the cash bail bond under
Section 17 (a), Rule 114 of the Revised Rules on Criminal Procedure. Under said
provision, the bail bond may be filed either with the court where the case is
pending, or with any Regional Trial Court (RTC) of the place of arrest, or with any
judge of the Metropolitan Trial Court or the Municipal Trial Court of the place of
arrest.
Lastly, Section 1 (h), Chapter 4 of A.M. No. 03-8-02-SC provides that executive
judges are authorized to exercise other powers and prerogatives which are
necessary or incidental to the performance of their functions in relation to court
administration. In the instant case, Judge Paredes was merely exercising powers
incidental to his functions as anExecutive Judge since he was the only judge
available when Lita Guioguio posted bail. Notably, Lita Guioguio’s payment for
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cash bail bond was made on a Sunday. In addition, the judge assignedto the court
where the Guioguio case was then pending and the executive judge of the MTCC,
Cebu City were not available to receive the bail bond. Judge Paredes was the only
judge available since the practice was for one judge to be present on Saturdays.
However, there was no judge assigned for duty during Sundays.
Relative to the matter above-discussed, the insinuation made by complainant Jill of
any irregularity reflected in the issuance of the two (2) orders of release of different
dates is not backed up by sufficient evidence.28
Conduct unbecoming of a judge is classified as a light offense under Section 10,
Rule 140 of the Rules of Court and penalized under Section 11(C) thereof by any
of the following: (1) A fine of not less than ₱1,000.00 but not exceeding
₱10,000.00; (2) Censure; (3) Reprimand; and (4) Admonition with warning.
Considering that this is the first offense of Judge Paredes, the appropriate penalty
under the circumstances is admonition.
WHEREFORE, the Court finds Judge Meinrado P. Paredes, Presiding Judge of
Branch 13 of the Regional Trial Court of Cebu City, administratively liable for
conduct unbecoming of a judge and ADMONISHES him therefor.
SO ORDERED.
G.R. No. 174996 December 3, 2014
BRO. BERNARD OCA, FSC, BRO. DENNIS MAGBANUA, FSC, MRS. CIRILA
MOJICA, MRS. JOSEFINA PASCUAL AND ST. FRANCIS SCHOOL OF
GENERAL TRIAS, CAVITE, INC., Petitioner,
vs.
LAURITA CUSTODIO, Respondent.
DECISION
LEONARDO-DE CASTRO, J.:
Before this Court is a petition for review under Rule 45 of the 1997 Rules of Civil
Procedure assailing the Decision1dated September 16, 2005 as well as the
Resolution2 dated October 9, 2006 of the Court of Appeals in CA-G.R. SP No.
79791, entitled "Bro. Bernard Oca, FSC, Bro. Dennis Magbanua, FSC, Mrs. Cirila
Mojica, Mrs. Josefina Pascual and St. Francis School of General Trias, Cavite, Inc.
v. Hon. Norbert J. Quisumbing, Jr., in his capacity as Presiding Judge, Regional
Trial Court, Branch 21, Imus, Cavite, and Mrs. Laurita Custodio". Through said
rulings, the appellate court dismissed the petition for certiorari under Rule 65 with
application for the issuance of a temporary restraining order and/or writ of
preliminary injunction against the Orders dated August 5, 2003,3 August 21,
20034and October 8, 20035 issued by Branch 21 of the Regional Trial Court (RTC)
of Imus, Cavite in SEC Case No. 024-02, entitled "Laurita Custodio, plaintiff,
versus Bro. Bernard Oca, Bro. Dennis Magbanua, Mrs. Cirila Mojica, Mrs. Josefina
Pascual, and St. Francis School, defendants."
The factual backdrop of the case
The facts of this case, as narrated in the assailed September 16, 2005 Decision of
the Court of Appeals, are as follows:
On July 9, 1973, petitioner St. Francis School of General Trias Cavite, Inc.
(School) was organized and established as a non-stock and non-profit educational
institution. The organization and establishment of the school was accomplished
through the assistance of the La Salle Brothers without any formal agreement with
the School. Thus, the incorporators of the School consist of the following persons:
private respondent Custodio, petitioner Cirila Mojica (Mojica), petitioner Josefina
Pascual (Pascual), Rev. Msgr. Feliz Perez, Bro. Vernon Poore, FSC. The five
original incorporators served as the School’s Members and Board of Trustees until
the deaths of Bro. Poore and Msgr. Perez.
On September 8, 1988, to formalize the relationship between the De La Salle
Greenhills (DLSG) and the School, a Memorandum of Agreement (MOA) was
executed. This agreement permitted DLSG to exercise supervisory powers over
the School’s academic affairs. Pursuant to the terms of the MOA, DLSG appointed
supervisors who sit in the meetings of the Board of Trustees without any voting
rights. The first such supervisor was Bro. Victor Franco. Later on, Bro. Franco also
became a member of the Board of Trustees and President of the School. Then, on
September 8, 1998, petitioner Bro. Bernard Oca joined Bro. Franco as DLSG
supervisor. In a while, Bro. Oca also served as a member of the Board of Trustees
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and President of the School. Bro. Dennis Magbanua also joined Bro. Franco and
Bro. Oca as DLSG supervisor and also as a Treasurer of the School.
Petitioners declare that the membership of the DLSG Brothers in the Board of
Trustee[s] as its officers was valid since an election was conducted to that effect.
On the other hand, Custodio challenges the validity of the membership of the
DLSG Brothers and their purported election as officers of the School. The legality
of the membership and election of the DLSG Brothers is the main issue of the case
in the lower court.
Custodio alleges that sometime in 1992, Bro. Franco was invited by Mrs. Mojica to
act as President of the School. This is because there was only the Tres Marias
(referring to the original incorporators, Pascual, Mojica and Custodio) who [were]
left tomanage the affairs of the school. Bro. Franco accepted the invitation.
However, while Bro. Franco acted as President and presided over meetingsof the
Tres Marias, he never participated in the operation of the School and never
exercised voting rights.
Custodio further alleges that on September 8, 1998, during one of the informal
meetings held at the School, Bro. Franco unilaterally declared the said meeting as
the Board of Trustees’ Meeting and at the same time an Annual Meeting of the
Members of the Corporation. During the meeting, Bro. Franco declared that the
corporation is composed of the Tres Marias and their husbands, Dr. Castaneda
and himself (Bro. Franco) as members. On the other hand, the Board of Trustees
was declared to be composed of Bro. Oca, the Tres Marias and himself (Bro.
Franco).
According to Custodio, when Bro. Franco eventually left and became inactive in
the School, Bro. Oca assumed his position as President and Chairman of the
Board of Trustees, without being formally admitted as member of the School and
without the benefit of an actual election. Custodio further states that on December
6, 2000, Bro. Magbanua was introduced to the original incorporators for the first
time. Automatically, he was declared as Member of the School and at the same
time, Treasurer by Bro. Oca, also without any formal admission into the corporate
membership and without the benefit of an actual election.
Custodio alleges that clearly the composition of the membership of the School had
no basis there being no formal admission as members nor election as officers.
It appears that the legality of the membership and assumption as officers of the
DLSG Brothers was questioned by Custodio following a disagreement regarding a
proposed MOA that would replace the existing MOA with the DLSG Brothers and
her removal as Curriculum Administrator through the Board of Trustee[s].
Under the proposed MOA, DLSG will supervise and control not only the academic
affairs of the School but also the matters of the finance, administration and
operations of the latter. Custodio vigorously opposed the proposed MOA.
Consequently, unable to convince Custodio and the academic populace to accept
the MOA, the DLSG brothers withdrew [their] academic support from the School. A
day after the rejection of the proposed MOA, Mojica and Pascual retired as
Administrators for Finance and Physical Resource Development (PRD),
respectively. However, they maintained their positions as Members and Trustees
of the School.
Custodio contends that while Pascual and Mojica remained to be Members and
Trustees of the School, upon retirement, they stopped reporting for work. Mr. Al
Mojica, son of Mrs. Mojica, who was then the school cashier, also stopped
reporting for work. Thus, Custodio avers that being the only remaining
Administrator, she served as the Over-all Director of the School. Being the Over-all
Director, Custodio made appointments to fill in the vacuum created by the sudden
retirement of Pascual and Mojica. Hence, she appointed Mr. Joseph Custodio as
OIC both for Finance and PRD and [Ms. Herminia] Reynante as Cashier.
Upon the appointment of Joseph Custodio and Reynante, a special meeting was
called by Bro. Oca in which the petitioners alleged that the prior organizational
structure was restored, and the retirement of Pascual and Mojica disapproved by
proper corporate action. It was agreed to in the meeting that the school was going
to revert to the three-man co-equal structure with Pascual as PRD head, Mojica as
Finance head and Custodio as Curriculum Administrator.
In the same meeting, petitioners alleged that Custodio admitted to having opened
an account with the Luzon Development Bank in her own name for the alleged
purpose of depositing funds for and in behalf of the School. Petitioners alleged that
a directive was issued for the immediate closing of this account. Still, Custodio
refused to close such account.
Subsequently, on January 31, 2002, Mojica and Pascual formally resigned from
their administrative posts. As such as a replacement, Atty. Eleuterio A. Pascual
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and Mr. Florante N. Mojica[,] Jr. were appointed by the Board of Trustees as PRD
Administrator and Finance Administrator respectively.
According to petitioners, due to the repeated refusal of Custodio to close the
account she opened in her own name with the Luzon Development Bank, the
Board of Trustees, in a meeting held on March 7, 2002, approved a resolution to
file a case against the latter. Consequently, the Board of Trustees also approved
resolutions to the effect that Custodio, Mr. Joseph Custodio and Reynante be
stopped from performing their functions in the School.
On June 7, 2002, Custodio filed a Complaint in the RTC of Trece Martirez City,
questioning the legality of the Board of the School. The case was docketed as Civil
Case No. TMCV-0033-02, entitled Laurita Custodio v. Bro. Bernard Oca, et al.
Custodio prayed for the issuance of a temporary restraining order and/or writ of
preliminary injunction for the purpose of preventing Bro. Oca as President of the
corporation, from calling a special membership meeting to remove Custodio as
Member of the School and the Board of Trustees. The case was dismissed on July
4, 2002.6
Summary of the legal proceedings involved
in the present controversy
On July 8, 2002, the Board of Trustees of St. Francis School resolved to remove
respondent Laurita Custodio as a member of the Board of Trustees and as a
member of the Corporation pursuant to Sections 28 and 91 of the Corporation
Code as indicated in Resolution No. 011-2002.7
Subsequently, respondent was issued a Memorandum dated July 23, 2002 and
signed by petitioner Bro. Bernard Oca, in his capacity as Chairman of the Board of
Trustees, wherein she was informed of her immediate removal as Curriculum
Administrator of St. Francis School on the grounds of willful breach of trust and
loss of confidence and for failure to explain the charges against her despite notice
from the Board of Trustees.8
In reaction to her removal, respondent filed with the trial court, on October 3, 2002,
a Complaint with Prayer for the Issuance of a Preliminary Injunction against
petitioners again assailing the legality of the membership of the Board of Trustees
of St. Francis School.9
During the submission of pleadings, respondent filed a Manifestation and Motion.
She alleged that on October 8, 2002, her son,Joseph Custodio, was being
prevented from entering the premises of the school. Also, respondent alleges that
a meeting with the parents of the School’s students was convened wherein the
parents were informed that she had been removed as Member of the corporation
and the Board of Trustees, and as Curriculum Administrator. As such, petitioners
directed the parents to give all payments regarding matriculation and other fees to
the corporate treasurer.10
On October 14, 2002, respondent filed another Motion for Clarification asking the
trial court toissue an order as to whom the matriculation fees should be paid
pending the hearing of the complaint and the earlier Manifestation and Motion. 11
Acting on the motions filed by respondent, the trial court in an Order dated October
21, 2002, appointed Herminia Reynante (Reynante) as cashier of the school and
required all parties to turn over all money previously collected with respect to
matriculation fees and other related collectibles of the school to the latter. 12
At this point, it should be noted that petitioners Cirila Mojica and Josefina Pascual
put up another school called the Academy of St. John with the same structure as
petitioner St. Francis School. This fact was testified to by petitioners’ counsel Atty.
Armando Fojas during the preliminary hearings on the main case.13
On October 30, 2002, petitioners filed a Motion for Reconsideration seeking to set
aside the October 21, 2002 Order of the trial court. Petitioners aver that had they
been given an opportunity to be heard and to present evidence to oppose the
appointment ofReynante, proof would have been adduced to demonstrate the
latter’s lackof moral integrity to act as court appointed cashier. 14
Subsequently, on February 19, 2003, petitioners filed a Manifestation informing the
trial court that in compliance with its October 21, 2002 Order, they took steps to
turn over the amount of ₱397,127.64, representing collections from matriculation
fees, but the same was not accepted by the court appointed cashier, Reynante,
who preferred to receive the amount in cash.15
On February 26, 2003, respondent filed her Comment in which she averred that
contrary to petitioners’ claim, petitioners had not complied with the October 21,
2002 Order for failure to include in their accounting, the funds allegedly in Special
Savings Deposit No. 239 and Special Savings Deposit No. 459 or the retirement
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fund for the teachers of the School, amounts paid by the canteen concessionaire,
and amounts paid to three resigned teachers.16
In an Order17 dated March 24, 2003, the trial court acted upon petitioners’
February 19, 2003 Manifestation and respondent’s February 26, 2003 Comment.
The text of the said March 24, 2003 Order is reproduced herein:
This treats of the defendant’s explanation, manifestation and plaintiff’s comment
thereto.
A perusal of the allegations of the defendants’ pleadings shows that they merely
turned-over a manager’s check in the amount of ₱397,127.64 representing money
collected from the students from October 2002 to December 2002. The Order of
October 21, 2002 directed plaintiff and defendants, as well as Mr. Al Mojica to turn
over to Ms. Herminia Reynante all money previously collected and to submit a
report on what have been collected, how much, from whom and the dates
collected.
Defendants and Mr. Al Mojica are hereby directed, within ten days from receipt
hereof, to submit a reportand to turn-over to Ms. Herminia Reynante all money
collected by them, more particularly:
1. ₱4,339,607.54 deposited in the Special Savings Deposit No. 239 (Rural
Bank of General Trias, Inc.);
2. ₱5,639,856.11 deposited in Special Savings Deposit No. 459 (Rural
Bank of General Trias, Inc.);
3. ₱92,970.00 representing amount paid by the school canteen;
4. Other fees collected from January 2003 to February 19, 2003;
5. Accounting on how and how muchdefendants are paying Ms. Daisy
Romero and three (3) other teachers who already resigned.18
On April 18, 2003, petitioners filed a Manifestation, Observation, Compliance,
Exception and Motion to the March 24, 2003 Order of the trial court which contests
the inclusion of specific funds to be turned over to Reynante.19
In the first questioned Order20 dated August 5, 2003, the lower court denied the
Manifestation and Motion of petitioners and reiterated its order for petitioners to
turn over the items enumerated in its March 24, 2003 Order.
Subsequently, in the second questioned Order21 dated August 21, 2003, the trial
court, acting favorably on private respondent’s October 9, 2002 Manifestation and
Motion ruled: WHEREFORE, in view of the foregoing, the motion is granted.
Accordingly, a status quoorder is hereby issued wherein the plaintiff is hereby
allowed to continue discharging her functions as school director and curriculum
administrator as well as those who are presently and actually discharging functions
as school officer to continue performing their duties until the application for the
issuance of a temporary restraining order is resolved.22
On September 1, 2003, petitioners filed a Motion for Clarification of the August 5,
2003 Order.23
In an Order24 dated October 8, 2003, the court ruled, to wit:
WHEREFORE, in view of the foregoing, the defendants are hereby ordered to
comply with the mandate contained in the order[s] dated March 24 and August 5,
2003.
Defendants are further directed toinform the court of the total amount of the funds
deposited reserved for teachers’ retirement, and in what bank and under what
account the same is deposited.25
Dissatisfied with the rulings made by the trial court, petitioners filed with the Court
of Appeals a petition for certiorari under Rule 65 with application for the issuance
of a temporary restraining order and/or writ of preliminary injunction to nullify, for
having been issued with grave abuse of discretion amounting to lack or in excess
of jurisdiction, the Orders dated August 5, 2003, August 21, 2003 and October 8,
2003 that were issued by the trial court.
However, the Court of Appeals frustrated petitioners’ move through the issuance of
the assailed September 16, 2005 Decision which dismissed outright petitioners’
special civil action for certiorari. Petitioners moved for reconsideration but this was
also thwarted by the Court of Appeals in the assailed October 9,2006 Resolution.
Thus, petitioners filed the instant petition and submitted the following issues for
consideration in their Memorandum 26 dated October 3, 2007:
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 A.
WHETHER OR NOT THE COURT OF APPEALS, CONTRARY TO LAW AND
JURISPRUDENCE, COMMITTED REVERSIBLE ERROR IN RULING THAT THE
TRIAL COURT HAD NOT DEPRIVED PETITIONERS OF DUE PROCESS IN
ISSUING ITS ORDERS OF 5 AUGUST 2003, 21 AUGUST 2003 AND 8
OCTOBER 2003.
B.
WHETHER OR NOT THE COURT OF APPEALS, CONTRARY TO LAW AND
JURISPRUDENCE, COMMITTED REVERSIBLE ERROR IN RULING THAT THE
TRIAL COURT DID NOT GRAVELY ABUSE ITS DISCRETION IN
DISREGARDING THE PROVISIONS OF THE INTERIM RULES OF
PROCEDURE FOR INTRACORPORATE CONTROVERSIES PERTAINING TO
THE ISSUANCE OF A STATUS QUOORDER AND THE REQUIREMENTS
THEREOF.27
On the other hand, respondent puts forward the following arguments in her
Memorandum28 dated October 9, 2007:
THE HONORABLE COURT OFAPPEALS WAS CORRECT WHEN IT RULED
THAT THE TRIAL COURT (RTC Br. 21) HAD NOT DEPRIVED PETITIONERS OF
DUE PROCESS IN ISSUING ITS ORDERS OF 5 AUGUST 2003, 21 AUGUST
2003 AND 8 OCTOBER 2003.
THE HONORABLE COURT OFAPPEALS WAS CORRECT WHEN IT RULED
THAT THE TRIAL COURT (RTC Br. 21) DID NOT COMMIT GRAVE ABUSE OF
DISCRETION WHEN IT ISSUED A STATUS QUOORDER.29
In fine, the sole issue in this case is whether or not the trial court committed grave
abuse of discretion inissuing the assailed Orders dated August 5, 2003, August 21,
2003 and October 8, 2003.
Petitioners argue that the Court of Appeals, in its assailed September 16, 2005
Decision, failed to consider that no adequate proceedings had been accorded to
the petitioners by the trial court for the exercise of its right to be heard on the
matters subject of the questioned Orders. Furthermore, petitioners point out that
the Court of Appeals erroneously gave its imprimatur to the trial court’s issuance of
the assailed Status Quo Order dated August 21, 2003 without first requiring and
accepting from respondent the requisite bond that is required under the Interim
Rules of Procedure for Intra-Corporate Controversies.
On the other hand, respondent maintains that the manner of the issuance of the
assailed Orders of the trial court did not violate the due process rights of
petitioners. Respondent also claims that a valid ground for the issuance of the
assailed Status Quo Order dated August 21, 2003 did exist and that the alleged
failure of the trial court to require the posting of a bond prior to the issuance of a
status quoorder was mooted by the assailed Order dated October 8, 2003 which
required respondent and Reynante to file a bond in the amount of ₱300,000.00
each.
We find the petition to be partly meritorious.
In the case of Garcia v. Executive Secretary,30 we reiterated what grave abuse of
discretion means in this jurisdiction, to wit:
Grave abuse of discretion means such capricious and whimsical exercise of
judgment as is equivalent to lack of jurisdiction. Mere abuse of discretion is not
enough. It must be grave abuse of discretion, as when the power is exercised in an
arbitrary or despotic manner by reason of passion or personal hostility, and must
be so patent and so gross as to amount to an evasion of a positive duty or to a
virtual refusal to perform the duty enjoined or to act at all in contemplation of law.
With regard to the right to due process, we have emphasized in jurisprudence that
while it is true that the right to due process safeguards the opportunity to be heard
and to submit any evidence one may have in support of his claim or defense, the
Court has time and again held that where the opportunity to be heard, either
through verbal arguments or pleadings, is accorded, and the party can "present its
side" or defend its "interest in due course," there is no denial of due process
because what the law proscribes is the lack of opportunity to be heard.31
In the case at bar, we find that petitioners were not denied due process by the trial
court when it issued the assailed Orders dated August 5, 2003, August 21, 2003
and October 8, 2003. The records would show that petitioners were given the
opportunity to ventilate their arguments through pleadings and that the same
pleadings were acknowledged in the text of the questioned rulings. Thus,
petitioners cannot claim grave abuse of discretion on the part of the trial court on
the basis of denial of due process.
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However, with respect to the assailed Status Quo Order dated August 21, 2003,
we find that the trial court has failed to comply with the pertinent procedural rules
regarding the issuance of a status quo order.
Jurisprudence tells us that a status quo order is merely intended to maintain the
last, actual, peaceable and uncontested state of things which preceded the
controversy. It further states that, unlike a temporary restraining order or a
preliminary injunction, a status quo order is more in the nature of a cease and
desist order, since it neither directs the doing or undoing of acts as in the case of
prohibitory or mandatory injunctive relief.32
Pertinently, the manner of the issuance of a status quoorder in an intra-corporate
suit such asthe case at bar is governed by Section 1, Rule 10 of the Interim Rules
of Procedure for Intra-Corporate Controversies which reads:
SECTION 1. Provisional remedies. - A party may apply for any of the provisional
remedies provided in the Rules of Court as may be available for the purposes.
However, no temporary restraining order or status quo order shall be issued save
in exceptional cases and only after hearing the parties and the posting of a bond.
In the case before us, the trial court’s August 21, 2003 Status Quo Order conflicted
with the rules and jurisprudence in the following manner:
First, the directive to reinstate respondent to her former position as school director
and curriculum administrator is a command directing the undoing of an act already
consummated which is the exclusive province of prohibitory or mandatory
injunctive relief and not of a status quo order which is limited only to maintaining
the last, actual, peaceable and uncontested state of things which immediately
preceded the controversy. It must be remembered that respondentwas already
removed as trustee, member of the corporation and curriculum administrator by
the Board of Trustees of St. Francis School of General Trias, Cavite, Inc. months
prior to her filing of the present case in the trial court.
Second, the trial court’s omission of not requiring respondent to file a bond before
the issuance of the Status Quo Order dated August 21, 2003 is in contravention
with the express instruction of Section 1, Rule 10 of the Interim Rules of Procedure
for Intra-Corporate Controversies. Even the subsequent order to post a bond as
indicated in the assailed October 8, 2003 Order did not cure this defect because a
careful reading of the nature and purpose of the bond would reveal that it was
meant by the trial court as security solely for the teachers’ retirement fund, the
possession of which was given by the trial court to respondent and
Reynante.1âwphi1 It was never intended and can never be considered as the
requisite security, in compliance with the express directive of procedural law, for
the assailed Status Quo Order dated August 21, 2003. In any event, there is
nothing on record to indicate that respondent had complied with the posting of the
bond as directed in the October 8, 2003 Order except for the respondent’s
unsubstantiated claim to the contrary as asserted in her Memorandum.33
Third, it is settled in jurisprudence that an application for a status quo order which
in fact seeks injunctive relief must comply with Section 4, Rule 58 of the Rules of
Court: i.e., the application must be verified aside from the posting of the requisite
bond.34 In the present case, the Manifestation and Motion, through which
respondent applied for injunctive relief or in the alternative a status quo order, was
merely signed by her counsel and was unverified.
In conclusion, we rule that no grave abuse of discretion was present in the
issuance of the assailed August 5, 2003 and October 8, 2003 Orders of the trial
court. However, we find that the issuance of the assailed August 21, 2003 Status
Quo Order was unwarranted for non-compliance with the rules. Therefore, the said
status quo order must be set aside.
At this point, the Court finds it apropos to note that the Status Quo Order on its
face states that the same is effective until the application for the issuance of a
temporary restraining order is resolved. However, respondent's prayer for a
temporary restraining order or a writ of preliminary injunction in her Complaint still
appears to be pending before the trial court. For this reason, the Court deems it
necessary to direct the trial court to resolve the same at the soonest possible time.
WHEREFORE, premises considered, the petition is PARTLY GRANTED. The
assailed Decision dated September 16, 2005 and the Resolution dated October 9,
2006 of the Court of Appeals in CA-G.R. SP No. 79791 are hereby AFFIRMED in
part insofar as they upheld the assailed August 5, 2003 and October 8, 2003
Orders of the trial court. They are REVERSED with respect to the assailed August
21, 2003 Status Quo Order which is hereby SET ASIDE for having been issued
with grave abuse of discretion. The trial court is further DIRECTED to resolve
respondent's application for injunctive relief with dispatch.
SO ORDERED.
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