G.R. No.147812. April 6, 2005 material possession of the premises.

3 The issue of ownership is immaterial therein4 and the outcome of the case

could not in any way affect conflicting claims of ownership, in this case between RCBC and LEYCON.
LEONARDO R. OCAMPO, Petitioners,
vs. Hence, the reason for the interpleader action ceased when the MeTC rendered judgment in Civil Case No. 6202
LEONORA TIRONA, Respondents. whereby the court directed METROCAN to pay LEYCON "whatever rentals due on the subject premises x x x." While
RCBC, not being a party to Civil Case No. 6202, could not be bound by the judgment therein, METROCAN is bound by
Interpleader the MeTC decision. When the decision in Civil Case No. 6202 became final and executory, METROCAN has no other
alternative left but to pay the rentals to LEYCON.

The good faith of Tirona is put in question in her preference for Maria Lourdes Breton-Mendiola. As a stakeholder,
Tirona should have used reasonable diligence in hailing the contending claimants to court. Tirona need not have It should be remembered that an action of interpleader is afforded to protect a person not against double liability but
awaited actual institution of a suit by Ocampo against her before filing a bill of interpleader. 37 An action for against double vexation in respect of one liability.7 It requires, as an indespensable requisite, that "conflicting claims
interpleader is proper when the lessee does not know the person to whom to pay rentals due to conflicting claims on upon the same subject matter are or may be made against the plaintiff-in-interpleader who claims no interest
the property.38 whatever in the subject matter or an interest which in whole or in part is not disputed by the claimants." 8 The
decision in Civil Case No. 6202 resolved the conflicting claims insofar as payment of rentals was concerned.

The action of interpleader is a remedy whereby a person who has property whether personal or real, in his
possession, or an obligation to render wholly or partially, without claiming any right in both, or claims an interest Petitioner is correct in saying that it is not bound by the decision in Civil Case No. 6202. It is not a party thereto.
which in whole or in part is not disputed by the conflicting claimants, comes to court and asks that the persons who However, it could not compel METROCAN to pursue Civil Case No. 4398-V-94. RCBC has other avenues to prove its
claim the said property or who consider themselves entitled to demand compliance with the obligation, be required to claim.
litigate among themselves, in order to determine finally who is entitled to one or the other thing. The remedy is
afforded not to protect a person against a double liability but to protect him against a double vexation in respect of G.R. No. 73794 September 19, 1988
one liability. When the court orders that the claimants litigate among themselves, there arises in reality a new action
and the former are styled interpleaders, and in such a case the pleading which initiates the action is called a ETERNAL GARDENS MEMORIAL PARKS CORPORATION, petitioner,
complaint of interpleader and not a cross-complaint.39 vs.
FIRST SPECIAL CASES DIVISION INTERMEDIATE APPELLATE COURT and NORTH PHILIPPINE UNION
Ocampo has the right to eject Tirona from the subject land. All the elements required for an unlawful detainer case to MISSION OF THE SEVENTH-DAY ADVENTISTS, respondents.
prosper are present. Ocampo notified Tirona that he purchased the subject land from Tirona’s lessor. Tirona’s
continued occupation of the subject land amounted to acquiescence to Ocampo’s terms. However, Tirona eventually In the case at bar, a careful analysis of the records will show that petitioner admitted among others in its complaint
refused to pay rent to Ocampo, thus violating the lease. 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
G.R. No. 127913      September 13, 2001 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:
RIZAL COMMERCIAL BANKING CORPORATION, petitioner, The private respondent (MEMORIAL) then reaffirms before the Court its original position that it is a disinterested
vs. party with respect to the property now the subject of the interpleader case ...
METRO CONTAINER CORPORATION, respondent. 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
Section 1, Rule 63 of the Revised Rules of Court2 provides: the Court. (Rollo, p. 227).
Section 1. - Interpleader when 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 Under the circumstances, there appears to be no plausible reason for petitioner's objections to the deposit of the
interplead and litigate their several claims among themselves. 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).
In the case before us, it is undisputed that METROCAN filed the interpleader action (Civil Case No. 4398-V-94)
because it was unsure which between LEYCON and RCBC was entitled to receive the payment of monthly rentals on
the subject property. LEYCON was claiming payment of the rentals as lessor of the property while RCBC was making As correctly observed by the Court of Appeals, the essence of an interpleader, aside from the disavowal of interest in
a demand by virtue of the consolidation of the title of the property in its name. 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 a rule founded on justice and equity: "that the plaintiff may not continue to benefit from the property or
funds in litigation during the pendency of the suit at the expense of whoever will ultimately be decided as entitled
It is also undisputed that LEYCON, as lessor of the subject property filed an action for unlawful detainer (Civil Case thereto." (Rollo, p. 24).
No. 6202) against its lessee METROCAN. The issue in Civil Case No. 6202 is limited to the question of physical or

1
G.R. No. 134241            August 11, 2003 Thus, a court may not permit a seller to retain, pendente lite, money paid by a buyer if the seller himself seeks
rescission of the sale because he has subsequently sold the same property to another buyer. 40 By seeking rescission,
DAVID REYES (Substituted by Victoria R. Fabella), petitioner, a seller necessarily offers to return what he has received from the buyer. Such a seller may not take back his offer if
vs. the court deems it equitable, to prevent unjust enrichment and ensure restitution, to put the money in judicial
JOSE LIM, CHUY CHENG KENG and HARRISON LUMBER, INC., respondents. deposit.

Reyes is seeking rescission of the Contract to Sell. In his amended answer, Lim is also seeking cancellation of the There is unjust enrichment when a person unjustly retains a benefit to the loss of another, or when a person retains
Contract to Sell. The trial court then ordered Reyes to deposit in court the P10 million down payment that Lim made money or property of another against the fundamental principles of justice, equity and good conscience. 41 In this
under the Contract to Sell. Reyes admits receipt of the P10 million down payment but opposes the order to deposit case, it was just, equitable and proper for the trial court to order the deposit of the P10 million down payment to
the amount in court. Reyes contends that prior to a judgment annulling the Contract to Sell, he has the "right to use, prevent unjust enrichment by Reyes at the expense of Lim.42
possess and enjoy"26 the P10 million as its "owner"27 unless the court orders its preliminary attachment.28
G.R. No. L-23851 March 26, 1976
To subscribe to Reyes’ contention will unjustly enrich Reyes at the expense of Lim. Reyes sold to Line One the
Property even before the balance of P18 million under the Contract to Sell with Lim became due on 8 March 1995. On WACK WACK GOLF & COUNTRY CLUB, INC., plaintiff-appellant,
1 March 1995, Reyes signed a Deed of Absolute Sale 29 in favor of Line One. On 3 March 1995, the Register of Deeds vs.
issued TCT No. 13476730 in the name of Line One.31 Reyes cannot claim ownership of the P10 million down payment LEE E. WON alias RAMON LEE and BIENVENIDO A. TAN, defendants-appellees.
because Reyes had already sold to another buyer the Property for which Lim made the down payment. In fact, in his
Comment32 dated 20 March 1996, Reyes reiterated his offer to return to Lim the P10 million down payment. 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
In Eternal Gardens Memorial Parks Corp. v. IAC,33 this Court held the plaintiff could not continue to benefit from either, comes to court and asks that the persons who claim the said personal property or who consider themselves
the property or funds in litigation during the pendency of the suit at the expense of whomever the court might entitled to demand compliance with the obligation, be required to litigate among themselves in order to determine
ultimately adjudge as the lawful owner. The Court declared: finally who is entitled to tone or the one thing. The remedy is afforded to protect a person not against double liability
In the case at bar, a careful analysis of the records will show that petitioner admitted among others in its complaint but against double vexation in respect of one liability. 3 The procedure under the Rules of Court 4 is the same as that
in Interpleader that it is still obligated to pay certain amounts to private respondent; that it claims no interest in under the Code of Civil Procedure, 5 except that under the former the remedy of interpleader is available regardless
such amounts due and is willing to pay whoever is declared entitled to said amounts. x x x 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.
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 There is no question that the subject matter of the present controversy, i.e., the membership fee certificate 201, is
where the deposit of aforesaid amounts is not only required by the nature of the action but is a contractual obligation proper for an interpleader suit. What is here disputed is the propriety and timeliness of the remedy in the light of the
of the petitioner under the Land Development Program (Rollo, p. 252). facts and circumstances obtaining.

There is also no plausible or justifiable reason for Reyes to object to the deposit of the P10 million down payment in A stakeholder 6 should use reasonable diligence to hale the contending claimants to court. 7 He need not await actual
court. The Contract to Sell can no longer be enforced because Reyes himself subsequently sold the Property to Line institution of independent suits against him before filing a bill of interpleader. 8 He should file an action of
One. Both Reyes and Lim are now seeking rescission of the Contract to Sell. Under Article 1385 of the Civil Code, interpleader within a reasonable time after a dispute has arisen without waiting to be sued by either of the
rescission creates the obligation to return the things that are the object of the contract. Rescission is possible only contending claimants. 9 Otherwise, he may be barred by laches 10 or undue delay. 11 But where he acts with
when the person demanding rescission can return whatever he may be obliged to restore. A court of equity will not reasonable diligence in view of the environmental circumstances, the remedy is not barred. 12
rescind a contract unless there is restitution, that is, the parties are restored to the status quo ante.34
Has the Corporation in this case acted with diligence, in view of all the circumstances, such that it may properly
Thus, since Reyes is demanding to rescind the Contract to Sell, he cannot refuse to deposit the P10 million down invoke the remedy of interpleader? We do not think so. It was aware of the conflicting claims of the appellees with
payment in court.35 Such deposit will ensure restitution of the P10 million to its rightful owner. Lim, on the other respect to the membership fee certificate 201 long before it filed the present interpleader suit. It had been
hand, has nothing to refund, as he has not received anything under the Contract to Sell.36 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.
The principle that no person may unjustly enrich himself at the expense of another is embodied in Article 22 38 of the
Civil Code. This principle applies not only to substantive rights but also to procedural remedies. One condition for It has been held that a stakeholder's action of interpleader is too late when filed after judgment has been rendered
invoking this principle is that the aggrieved party has no other action based on contract, quasi-contract, crime, quasi- against him in favor of one of the contending claimants, 13 especially where he had notice of the conflicting claims
delict or any other provision of law.39 Courts can extend this condition to the hiatus in the Rules of Court where the prior to the rendition of the judgment and neglected the opportunity to implead the adverse claimants in the suit
aggrieved party, during the pendency of the case, has no other recourse based on the provisional remedies of the where judgment was entered. This must be so, because once judgment is obtained against him by one claimant he
Rules of Court. becomes liable to the latter

2
The Corporation has not shown any justifiable reason why it did not file an application for interpleader in civil case G.R. No. 70145 November 13, 1986
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. MARCELO A. MESINA, petitioner,
vs.
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 THE HONORABLE INTERMEDIATE APPELLATE COURT, HON. ARSENIO M. GONONG, in his capacity as
must be prepared to show, among other prerequisites, that he has not become independently liable to any of the Judge of Regional Trial Court — Manila (Branch VIII), JOSE GO, and ALBERT UY, respondents.
claimants.
Petitioner's allegations hold no water. Theories and examples advanced by petitioner on causes and effects of a
It is also the general rule that a bill of interpleader comes too late when it is filed after judgment has been cashier's check such as 1) it cannot be countermanded in the hands of a holder in due course and 2) a cashier's
rendered in favor of one of the claimants of the fund, this being especially true when the holder of the funds had check is a bill of exchange drawn by the bank against itself-are general principles which cannot be aptly applied to
notice of the conflicting claims prior to the rendition of the judgment and had an opportunity to implead the the case at bar, without considering other things. Petitioner failed to substantiate his claim that he is a holder in due
adverse claimants in the suit in which the judgment was rendered.  course and for consideration or value as shown by the established facts of the case. Admittedly, petitioner became
the holder of the cashier's check as endorsed by Alexander Lim who stole the check. He refused to say how and why
If a stakeholder defends a suit by one claimant and allows it to proceed so far as a judgment against him without it was passed to him. He had therefore notice of the defect of his title over the check from the start. The holder of a
filing a bill of interpleader, it then becomes too late for him to do so. It is one o the main offices of a bill of cashier's check who is not a holder in due course cannot enforce such check against the issuing bank which dishonors
interpleader to restrain a separate proceeding at law by claimant so as to avoid the resulting partial judgment; and the same. If a payee of a cashier's check obtained it from the issuing bank by fraud, or if there is some other reason
if the stakeholder acquiesces in one claimant's trying out his claim and establishing it at law, he cannot then have why the payee is not entitled to collect the check, the respondent bank would, of course, have the right to refuse
that part of the litigation repeated in an interpleader suit. payment of the check when presented by the payee, since respondent bank was aware of the facts surrounding the
loss of the check in question. At the outset, respondent bank knew it was Jose Go's check and no one else since Go
had not paid or indorsed it to anyone. The bank was therefore liable to nobody on the check but Jose Go. The bank
It is the general rule that a bill of interpleader comes too late when application therefore is delayed until after had no intention to issue it to petitioner but only to buyer Jose Go.
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. In his second assignment of error, petitioner stubbornly insists that there is no showing of conflicting claims and
interpleader is out of the question. There is enough evidence to establish the contrary. Considering the
aforementioned facts and circumstances, respondent bank merely took the necessary precaution not to make a
The remedy by interpleader is afforded to protect the party from the annoyance and hazard of two or more actions mistake as to whom to pay and therefore interpleader was its proper remedy. It has been shown that the
touching the same property or demand; but one who, with knowledge of all the facts, neglects to avail himself of interpleader suit was filed by respondent bank because petitioner and Jose Go were both laying their claims on the
the relief, or elects to take the chances for success in the actions at law, ought to submit to the consequences of check, petitioner asking payment thereon and Jose Go as the purchaser or owner. The allegation of petitioner that
defeat. To permit an unsuccessful defendant to compel the successful plaintiffs to interplead, is to increase instead respondent bank had effectively relieved itself of its primary liability under the check by simply filing a complaint for
of to diminish the number of suits; to put upon the shoulders of others the burden which he asks may be taken interpleader is belied by the willingness of respondent bank to issue a certificate of time deposit in the amount of
from his own. ....' P800,000 representing the cashier's check in question in the name of the Clerk of Court of Manila to be awarded to
whoever wig be found by the court as validly entitled to it. Said validity will depend on the strength of the parties'
Besides, a successful litigant cannot later be impleaded by his defeated adversary in an interpleader suit and respective rights and titles thereto. Bank filed the interpleader suit not because petitioner sued it but because
compelled to prove his claim anew against other adverse claimants, as that would in effect be a collateral attack petitioner is laying claim to the same check that Go is claiming.
upon the judgment.
G.R. No. 110249 August 21, 1997
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 ALFREDO TANO, BALDOMERO TANO, DANILO TANO, ROMUALDO TANO, TEOCENES MIDELLO, petitioners,
one of the claimants of the fund, and this is especially true where the holder of the fund had notice of the vs.
conflicting claims prior to the rendition of such judgment and an opportunity to implead the adverse claimants in HON. GOV. SALVADOR P. SOCRATES, MEMBERS OF SANGGUNIANG PANLALAWIGAN OF PALAWAN,
the suit in which such judgment was rendered. namely, VICE-GOVERNOR JOEL T. REYES, JOSE D. ZABALA, ROSALINO R. ACOSTA, JOSELITO A. CADLAON,
ANDRES R. BAACO, NELSON P. PENEYRA, CIPRIANO C. BARROMA, CLARO E. ORDINARIO, ERNESTO A.
In fine, the instant interpleader suit cannot prosper because the Corporation had already been made independently LLACUNA, RODOLFO C. FLORDELIZA, GILBERT S. BAACO, WINSTON G. ARZAGA, NAPOLEON F. ORDONEZ
liable in civil case 26044 and, therefore, its present application for interpleader would in effect be a collateral attack and GIL P. ACOSTA, respondents.
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 The primary interest of the first set of petitioners is, of course, to prevent the prosecution, trial and determination of
rights anew, and thereby increase instead of diminish litigations, which is one of the purposes of an interpleader suit, the criminal cases until the constitutionality or legality of the Ordinances they allegedly violated shall have been
with the possiblity that the benefits of the final judgment in the said civil case might eventually be taken away from resolved. The second set of petitioners merely claim that being fishermen or marine merchants, they would be
him; and because the Corporation allowed itself to be sued to final judgment in the said case, its action of adversely affected by the ordinance's.
interpleader was filed inexcusably late, for which reason it is barred by laches or unreasonable delay.

3
As to the first set of petitioners, this special civil for certiorari must fail on the ground of prematurity amounting to a under the full control and supervision of the State." Moreover, their mandated protection, development and
lack of cause of action. There is no showing that said petitioners, as the accused in the criminal cases, have filed conservation as necessarily recognized by the framers of the Constitution, imply certain restrictions on whatever
motions to quash the informations therein and that the same were denied. The ground available for such motions is right of enjoyment there may be in favor of anyone.
that the facts charged therein do not constitute an offense because the ordinances in question are
unconstitutional. 6 It cannot then be said that the lower courts acted without or in excess of jurisdiction or with G.R. No. 159357             April 28, 2004
grave abuse of discretion to justify recourse to the extraordinary remedy of certiorari or prohibition. It must further
be stressed that even if petitioners did file motions to quash, the denial thereof would not forthwith give rise to a
cause of action under Rule 65 of the Rules of Court. The general rule is that where a motion to quash is denied, the Brother MARIANO "MIKE" Z. VELARDE, petitioner,
remedy therefrom is not certiorari, but for the party aggrieved thereby to go to trial without prejudice to reiterating vs.
special defenses involved in said motion, and if, after trial on the merits an adverse decision is rendered, to appeal SOCIAL JUSTICE SOCIETY, respondent.
therefrom in the manner authorized by law. 7 And, even where in an exceptional circumstance such denial may be
the subject of a special civil action for certiorari, a motion for reconsideration must have to be filed to allow the court Procedural Issues: Requisites of Petitions for Declaratory Relief
concerned an opportunity to correct its errors, unless such motion may be dispensed with because of existing
exceptional circumstances. 8 Finally, even if a motion for reconsideration has been filed and denied, the remedy Section 1 of Rule 63 of the Rules of Court, which deals with petitions for declaratory relief, provides in part:
under Rule 65 is still unavailable absent any showing of the grounds provided for in Section 1 thereof. 9 For obvious
"Section 1. Who may file petition.- Any person interested under a deed, will, contract or other written instrument,
reasons, the petition at bar does not, and could not have, alleged any of such grounds. 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
As to the second set of petitioners, the instant petition is obviously one for DECLARATORY RELIEF, i.e., for a determine any question of construction or validity arising, and for a declaration of his rights or duties thereunder."
declaration that the Ordinances in question are a "nullity . . . for being unconstitutional."10 As such, their petition
must likewise fail, as this Court is not possessed of original jurisdiction over petitions for declaratory relief even if
Based on the foregoing, an action for declaratory relief should be filed by a person interested under a deed, a will, a
only questions of law are involved,11 it being settled that the Court merely exercises appellate jurisdiction over such contract or other written instrument, and whose rights are affected by a statute, an executive order, a regulation or
petitions.12
an ordinance. The purpose of the remedy is to interpret or to determine the validity of the written instrument and to
seek a judicial declaration of the parties’ rights or duties thereunder.16 The essential requisites of the action are as
It is of course settled that laws (including ordinances enacted by local government units) enjoy the presumption of follows: (1) there is a justiciable controversy; (2) the controversy is between persons whose interests are adverse;
constitutionality. 15 To overthrow this presumption, there must be a clear and unequivocal breach of the Constitution, (3) the party seeking the relief has a legal interest in the controversy; and (4) the issue is ripe for judicial
not merely a doubtful or argumentative contradiction. In short, the conflict with the Constitution must be shown determination.17
beyond reasonable doubt.16 Where doubt exists, even if well-founded, there can be no finding of unconstitutionality.
To doubt is to sustain.17 Justiciable Controversy

After a scrutiny of the challenged Ordinances and the provisions of the Constitution petitioners claim to have been
Brother Mike Velarde contends that the SJS Petition failed to allege, much less establish before the trial court, that
violated, we find petitioners' contentions baseless and so hold that the former do not suffer from any infirmity, both there existed a justiciable controversy or an adverse legal interest between them; and that SJS had a legal right that
under the Constitution and applicable laws.
was being violated or threatened to be violated by petitioner. On the contrary, Velarde alleges that SJS premised its
action on mere speculations, contingent events, and hypothetical issues that had not yet ripened into an actual
Petitioners specifically point to Section 2, Article XII and Sections 2 and 7, Article XIII of the Constitution as having controversy. Thus, its Petition for Declaratory Relief must fail.
been transgressed by the Ordinances.
A justiciable controversy refers to an existing case or controversy that is appropriate or ripe for judicial
Besides, Section 2 of Article XII aims primarily not to bestow any right to subsistence fishermen, but to lay stress on determination, not one that is conjectural or merely anticipatory.18 The SJS Petition for Declaratory Relief fell short of
the duty of the State to protect the nation's marine wealth. What the provision merely recognizes is that the State this test. It miserably failed to allege an existing controversy or dispute between the petitioner and the named
may allow, by law, cooperative fish farming, with priority to subsistence fishermen and fishworkers in rivers, lakes, respondents therein. Further, the Petition did not sufficiently state what specific legal right of the petitioner was
bays and lagoons. violated by the respondents therein; and what particular act or acts of the latter were in breach of its rights, the law
or the Constitution.
Anent Section 7 of Article XIII, it speaks not only of the use of communal marine and fishing resources, but of their
protection, development and conservation. As hereafter shown, the ordinances in question are meant precisely to At the time SJS filed its Petition on January 28, 2003, the election season had not even started yet; and that, in any
protect and conserve our marine resources to the end that their enjoyment may be guaranteed not only for the event, he has not been actively involved in partisan politics.
present generation, but also for the generations to come.

An initiatory complaint or petition filed with the trial court should contain "a plain, concise and direct statement of the
The so-called "preferential right" of subsistence or marginal fishermen to the use of marine resources is not at all ultimate facts on which the party pleading relies for his claim x x x."20 Yet, the SJS Petition stated no ultimate facts.
absolute. In accordance with the Regalian Doctrine, marine resources belong to the State, and, pursuant to the first
paragraph of Section 2, Article XII of the Constitution, their "exploration, development and utilization . . . shall be

4
Indeed, SJS merely speculated or anticipated without factual moorings that, as religious leaders, the petitioner and Legal standing or locus standi has been defined as a personal and substantial interest in the case, such that the party
his co-respondents below had endorsed or threatened to endorse a candidate or candidates for elective offices. has sustained or will sustain direct injury as a result of the challenged act. 37 Interest means a material interest in
issue that is affected by the questioned act or instrument, as distinguished from a mere incidental interest in the
Such premise is highly speculative and merely theoretical, to say the least. Clearly, it does not suffice to constitute a question involved.38
justiciable controversy. The Petition does not even allege any indication or manifest intent on the part of any of the
respondents below to champion an electoral candidate, or to urge their so-called flock to vote for, or not to vote for, Petitioner alleges that "[i]n seeking declaratory relief as to the constitutionality of an act of a religious leader to
a particular candidate. It is a time-honored rule that sheer speculation does not give rise to an actionable right. endorse, or require the members of the religious flock to vote for a specific candidate, herein Respondent SJS has no
legal interest in the controversy"; 39 it has failed to establish how the resolution of the proffered question would
Obviously, there is no factual allegation that SJS’ rights are being subjected to any threatened, imminent and benefit or injure it.
inevitable violation that should be prevented by the declaratory relief sought.
Parties bringing suits challenging the constitutionality of a law, an act or a statute must show "not only that the law
Cause of Action [or act] is invalid, but also that [they have] sustained or [are] in immediate or imminent danger of sustaining some
direct injury as a result of its enforcement, and not merely that [they] suffer thereby in some indefinite way."40 They
must demonstrate that they have been, or are about to be, denied some right or privilege to which they are lawfully
Respondent SJS asserts that in order to maintain a petition for declaratory relief, a cause of action need not be entitled, or that they are about to be subjected to some burdens or penalties by reason of the statute or act
alleged or proven. Supposedly, for such petition to prosper, there need not be any violation of a right, breach of duty complained of.41
or actual wrong committed by one party against the other.

First, parties suing as taxpayers must specifically prove that they have sufficient interest in preventing the illegal
Petitioner, on the other hand, argues that the subject matter of an action for declaratory relief should be a deed, a expenditure of money raised by taxation.42 A taxpayer’s action may be properly brought only when there is an
will, a contract (or other written instrument), a statute, an executive order, a regulation or an ordinance. But the exercise by Congress of its taxing or spending power.43 In the present case, there is no allegation, whether express
subject matter of the SJS Petition is "the constitutionality of an act of a religious leader to endorse the candidacy of a or implied, that taxpayers’ money is being illegally disbursed.
candidate for elective office or to urge or require the members of the flock to vote for a specified
candidate."26 According to petitioner, this subject matter is "beyond the realm of an action for declaratory
relief."27 Petitioner avers that in the absence of a valid subject matter, the Petition fails to state a cause of action Second, there was no showing in the Petition for Declaratory Relief that SJS as a political party or its members as
and, hence, should have been dismissed outright by the court a quo. registered voters would be adversely affected by the alleged acts of the respondents below, if the question at issue
was not resolved. There was no allegation that SJS had suffered or would be deprived of votes due to the acts
imputed to the said respondents. Neither did it allege that any of its members would be denied the right of suffrage
A cause of action is an act or an omission of one party in violation of the legal right or rights of another, causing or the privilege to be voted for a public office they are seeking.
injury to the latter.28 Its essential elements are the following: (1) a right in favor of the plaintiff; (2) an obligation on
the part of the named defendant to respect or not to violate such right; and (3) such defendant’s act or omission that
is violative of the right of the plaintiff or constituting a breach of the obligation of the former to the latter.29 Finally, the allegedly keen interest of its "thousands of members who are citizens-taxpayers-registered voters" is too
general44 and beyond the contemplation of the standards set by our jurisprudence. Not only is the presumed interest
impersonal in character; it is likewise too vague, highly speculative and uncertain to satisfy the requirement of
The failure of a complaint to state a cause of action is a ground for its outright dismissal. 30 However, in special civil standing.45
actions for declaratory relief, the concept of a cause of action under ordinary civil actions does not strictly apply. The
reason for this exception is that an action for declaratory relief presupposes that there has been no actual breach of
the instruments involved or of rights arising thereunder. 31 Nevertheless, a breach or violation should be impending, Transcendental Importance
imminent or at least threatened.
Similarly in the instant case, the Court deemed the constitutional issue raised in the SJS Petition to be of paramount
A perusal of the Petition filed by SJS before the RTC discloses no explicit allegation that the former had any legal interest to the Filipino people.
right in its favor that it sought to protect. The Rules require that the interest must be material to the issue and
affected by the questioned act or instrument, as distinguished from simple curiosity or incidental interest in the Regrettably, it is not legally possible for the Court to take up, on the merits, the paramount question involving a
question raised.34 constitutional principle. It is a time-honored rule that "the constitutionality of a statute [or act] will be passed upon
only if, and to the extent that, it is directly and necessarily involved in a justiciable controversy and is essential to the
Indeed, the Court finds in the Petition for Declaratory Relief no single allegation of fact upon which SJS could base a protection of the rights of the parties concerned."100
right of relief from the named respondents. In any event, even granting that it sufficiently asserted a legal right it
sought to protect, there was nevertheless no certainty that such right would be invaded by the said respondents. Not G.R. No. 150806             January 28, 2008
even the alleged proximity of the elections to the time the Petition was filed below (January 28, 2003) would have
provided the certainty that it had a legal right that would be jeopardized or violated by any of those respondents. EUFEMIA ALMEDA and ROMEL ALMEDA, petitioners,
vs.
Legal Standing BATHALA MARKETING INDUSTRIES, INC., respondent.

5
Declaratory relief is defined as an action by any person interested in a deed, will, contract or other written THE HON. AUGUSTO M. AMORES, Judge of Br. XXIV, Court of First Instance of Manila, and C.F. SHARP &
instrument, executive order or resolution, to determine any question of construction or validity arising from the CO., INC., respondents.
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 In the case at bar, private respondent has two (2) alternative principal causes of action, to wit: either for declaratory
instrument or statute. Corollary is the general rule that such an action must be justified, as no other adequate relief relief or for injunction. Allegedly, in both cases, the status of the plaintiff is not only affected but is the main issue at
or remedy is available under the circumstances. 15 hand.

Decisional law enumerates the requisites of an action for declaratory relief, as follows: 1) the subject matter of the As defined, "Status means a legal personal relationship, not temporary in nature nor terminable at the mere will of
controversy must be a deed, will, contract or other written instrument, statute, executive order or regulation, or the parties, with which third persons and the state are concerned" (Holzer v. Deutsche Reichsbahn Gesellschaft, 290
ordinance; 2) the terms of said documents and the validity thereof are doubtful and require judicial construction; 3) NYS 181; cited in 40 Words and Phrases, 129, Permanent Edition).
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 easy to see in the instant case, that what is sought is a declaration not only that private respondent is a
corporation for there is no dispute on that matter but also that it is separate and distinct from C.F. Sharp Kabushiki
Kaisha and therefore, not liable for the latter's indebtedness. It is evident that monetary obligations does not, in any
It is beyond cavil that the foregoing requisites are present in the instant case, except that petitioners insist that way, refer to status, lights and obligations. Obligations are more or less temporary, but status is relatively
respondent was already in breach of the contract when the petition was filed. permanent. But more importantly, as cited in the case of (Dy Poco v. Commissioner of Immigration, et al.,   16 SCRA
618 [1966]), the prevailing rule is that "where a declaratory judgment as to a disputed fact would be determinative
We do not agree. of issues rather than a construction of definite stated rights, status and other relations, commonly expressed in
written instrument, the case is not one for declaratory judgment." Thus, considering the nature of a proceeding for
After petitioners demanded payment of adjusted rentals and in the months that followed, respondent complied with declaratory judgment, wherein relief may be sought only to declare rights and not to determine or try issues, there is
the terms and conditions set forth in their contract of lease by paying the rentals stipulated therein. Respondent more valid reason to adhere to the principle that a declaratory relief proceeding is unavailable where judgment would
religiously fulfilled its obligations to petitioners even during the pendency of the present suit. There is no showing have to be made, only after a judicial investigation of disputed issues (ibid). In fact, private respondent itself
that respondent committed an act constituting a breach of the subject contract of lease. Thus, respondent is not perceives that petitioners may even seek to pierce the veil of corporate identity (Rollo, p. 63).
barred from instituting before the trial court the petition for declaratory relief.
Otherwise stated, there is no action relating to or the subject of which are the properties of the defendants in the
Petitioners claim that the instant petition is not proper because a separate action for rescission, ejectment and Philippines for it is beyond dispute that they have none in this jurisdiction nor can it be said that they have claimed
damages had been commenced before another court; thus, the construction of the subject contractual provisions any lien or interest, actual or contingent over any property herein, for as above stated, they merely demanded or
should be ventilated in the same forum. attempted to demand from private respondent payment of the monetary obligations of C.F. Sharp K.K., No action in
court has as yet ensued. Verily, the fact that C.F. Sharp Philippines is an entity separate and distinct from C.F. Sharp
K.K., is a matter of defense that can be raised by the former at the proper time.
We are not convinced.

Hence, as ruled by this Court, where the complaint does not involve the personal status of plaintiff, nor any property
It is true that in Panganiban v. Pilipinas Shell Petroleum Corporation 17 we held that the petition for declaratory relief in the Philippines in which defendants have or claim an interest, or which the plaintiff has attached, but purely an
should be dismissed in view of the pendency of a separate action for unlawful detainer. However, we cannot apply action for injunction, it is a personal action as well as an action in personam, not an action in rem or quasi in rem. As
the same ruling to the instant case. In Panganiban, the unlawful detainer case had already been resolved by the trial a personal action, personal or substituted service of summons on the defendants, not extraterritorial service, is
court before the dismissal of the declaratory relief case; and it was petitioner in that case who insisted that the action necessary to confer jurisdiction on the court.
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 G.R. No. 144101 September 16, 2005
pending the resolution of the action for declaratory relief.
ANTONIO P. TAMBUNTING, JR. and COMMERCIAL HOUSE OF FINANCE, INC., Petitioners,
G.R. No. L-58340             July 16, 1991 vs.
SPOUSES EMILIO SUMABAT and ESPERANZA BAELLO, Respondent.

KAWASAKI PORT SERVICE CORPORATION, NAIKAI SHIPPING CO. LTD., NAIKAI TUG BOAT SERVICE CO.,
THE PORT SERVICE CORPORATION, LICENSED LAND SEA PILOTS ASSOCIATION, HAYAKOMA UNYU K.K., An action for declaratory relief should be filed by a person interested under a deed, will, contract or other written
TOKYO KISEN COMPANY, LTD., OMORI KAISOTEN, LTD., TOHOKU UNYU CO., LTD. AND SEITETSU UNYU instrument, and whose rights are affected by a statute, executive order, regulation or ordinance before  breach or
CO., LTD., petitioners, violation thereof.1 The purpose of the action is to secure an authoritative statement of the rights and obligations of
vs. 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.2 It may be entertained only before the breach or violation of the statute, deed,
contract, etc. to which it refers.3 Where the law or contract has already been contravened prior to the filing of an

6
action for declaratory relief, the court can no longer assume jurisdiction over the action. 4 In other words, a court has NATIONAL HOME MORTGAGE FINANCE CORPORATION and HOME DEVELOPMENT MUTUAL
no more jurisdiction over an action for declaratory relief if its subject, i.e., the statute, deed, contract, etc., has FUND, respondents.
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 I. Worthy of recall, the RTC held that respondents’ 25 act of initiating foreclosure proceedings was in breach of Rep.
or clarify short of a judgment or final order. Act No. 8501 and rendered the action of declaratory relief improper. The RTC suggested that the proper remedy is an
ordinary civil action. Incidentally, this point is also related to petitioners’ contention that the Court of Appeals should
Here, an infraction of the mortgage terms had already taken place before the filing of Civil Case No. C-7496. Thus, have ordered the conversion of their petition filed before the RTC to an ordinary civil action, under the provisions of
the CFI lacked jurisdiction when it took cognizance of the case in 1979. And in the absence of jurisdiction, its decision Section 6,26 Rule 63 of the Rules of Court.
was void and without legal effect. As this Court held in  Arevalo v. Benedicto:5
We agree with the RTC but hasten to point out that the RTC had not ruled on whether the petition was also improper
Furthermore, the want of jurisdiction by a court over the subject-matter renders its judgment void and a mere as a petition for prohibition. Indeed, under Section 1,27 Rule 63, a person must file a petition for declaratory relief
nullity, and considering that a void judgment is in legal effect no judgment, by which no rights are divested, from before breach or violation of a deed, will, contract, other written instrument, statute, executive order, regulation,
which no rights can be obtained, which neither binds nor bars any one, and under which all acts performed and all ordinance or any other governmental regulation. In this case, the petitioners had stated in their petition that
claims flowing out of are void, and considering further, that the decision, for want of jurisdiction of the court, is not a respondents assessed them interest and penalties on their outstanding loans, initiated foreclosure proceedings
decision in contemplation of law, and, hence, can never become executory, it follows that such a void judgment against petitioner Rafael Martelino as evidenced by the notice of extra-judicial sale 28 and threatened to foreclose the
cannot constitute a bar to another case by reason of res judicata. 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
G.R. No. 164171             February 20, 2006 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
HON. EXECUTIVE SECRETARY, HON. SECRETARY OF THE DEPARTMENT OF TRANSPORTATION AND identified as P.D. No. 957 and relied upon -- correctly or otherwise -- by petitioners, and assumed by the RTC to be
COMMUNICATIONS (DOTC), COMMISSIONER OF CUSTOMS, ASSISTANT SECRETARY, LAND Rep. Act No. 8501, was breached before filing the action. As we said in Tambunting, Jr. v. Sumabat:29
TRANSPORTATION OFFICE (LTO), COLLECTOR OF CUSTOMS, SUBIC BAY FREE PORT ZONE, AND CHIEF OF . . . The purpose of the action [for declaratory relief] is to secure an authoritative statement of the rights and
LTO, SUBIC BAY FREE PORT ZONE, Petitioners, obligations of the parties under a statute, deed, contract, etc. for their guidance in its enforcement or compliance
vs. and not to settle issues arising from its alleged breach. It may be entertained only before the breach or violation of
SOUTHWING HEAVY INDUSTRIES, INC., represented by its President JOSE T. DIZON, UNITED the statute, deed, contract, etc. to which it refers. Where the law or contract has already been contravened prior to
AUCTIONEERS, INC., represented by its President DOMINIC SYTIN, and MICROVAN, INC., represented by the filing of an action for declaratory relief, the court can no longer assume jurisdiction over the action.… Under
its President MARIANO C. SONON, Respondents. 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.30
The established rule that the constitutionality of a law or administrative issuance can be challenged by one who will
sustain a direct injury as a result of its enforcement11 has been satisfied in the instant case. The broad subject of the Under the circumstances, may the Court nonetheless allow the conversion of the petition for declaratory relief and
prohibited importation is "all types of used motor vehicles." Respondents would definitely suffer a direct injury prohibition into an ordinary action? We are constrained to say: no. Although Section 6, Rule 63 might allow such
from the implementation of EO 156 because their certificate of registration and tax exemption authorize them to course of action, the respondents did not argue the point, and we note petitioners’ failure to specify the ordinary
trade and/or import new and used motor vehicles and spare parts, except "used cars."12 Other types of motor action they desired. We also cannot reasonably assume that they now seek annulment of the mortgages.
vehicles imported and/or traded by respondents and not falling within the category of used cars would thus be
subjected to the ban to the prejudice of their business. Undoubtedly, respondents have the legal standing to assail
the validity of EO 156. Assuming the Court can also treat the Petition for Declaratory Relief and Prohibition as an action for prohibition, we
must still hold that prohibition is improper. Prohibition is a remedy against proceedings that are without or in excess
of jurisdiction, or with grave abuse of discretion, there being no appeal or other plain, speedy adequate remedy in
As to the propriety of declaratory relief as a vehicle for assailing the executive issuance, suffice it to state that any the ordinary course of law.35 But here, the petition did not even impute lack of jurisdiction or grave abuse of
breach of the rights of respondents will not affect the case. In Commission on Audit of the Province of Cebu v. discretion committed by respondents and Sheriff Castillo regarding the foreclosure proceedings.
Province of Cebu,13 the Court entertained a suit for declaratory relief to finally settle the doubt as to the proper
interpretation of the conflicting laws involved, notwithstanding a violation of the right of the party affected. We find
no reason to deviate from said ruling mindful of the significance of the present case to the national economy. G.R. No. L-24153 February 14, 1983

G.R. No. 160208             June 30, 2008 TOMAS VELASCO, LOURDES RAMIREZ, SY PIN, EDMUNDO UNSON, APOLONIA RAMIREZ and LOURDES
LOMIBAO, as component members of the STA. CRUZ BARBERSHOP ASSOCIATION, in their own behalf and
in representation of the other owners of barbershops in the City of Manila, petitioners-appellants,
RAFAEL R. MARTELINO, BARCHELECHU S. MORALES, ROSELYN S. CACHAPERO, REYNALDO R. vs.
EVANGELISTA, CESAR B. YAPE, LEONORA R. PARAS, SEGUNDINA I. IBARRA, RAQUEL G. HALNIN, ZAMORA HON. ANTONIO J. VILLEGAS, City Mayor of Manila, HON. HERMINIO A. ASTORGA, Vice-Mayor and
I. DIAZ, and ARTHUR L. VEGA,* petitioners,
vs.

7
Presiding Officer of the Municipal Board in relation to Republic Act 4065, THE MUNICIPAL BOARD OF THE The nature of the BSP Monetary Board as a quasi-judicial agency, and the character of its determination of whether
CITY OF MANILA and EDUARDO QUINTOS SR., Chief of Police of the City of Manila, respondents-appellees. or not appropriate sanctions may be imposed upon erring banks, as anexercise of quasi-judicial function, have been
recognized by this Court in the case of United Coconut Planters Bank v. E. Ganzon, Inc.,15 to wit:
This is an appeal from an order of the lower court dismissing a suit for declaratory relief challenging the
constitutionality based on Ordinance No. 4964 of the City of Manila, the contention being that it amounts to a A quasi-judicial agency or body isan organ of government other than a court and other thana legislature, which
deprivation of property of petitioners-appellants of their means of livelihood without due process of law. The assailed affects the rights of private parties through either adjudication or rule-making. A "quasi-judicial function" is a term
ordinance is worded thus: "It shall be prohibited for any operator of any barber shop to conduct the business of which applies to the action, discretion, etc. of public administrative officers or bodies, who are required to investigate
massaging customers or other persons in any adjacent room or rooms of said barber shop, or in any room or rooms facts, or ascertain the existence of facts, hold hearings, and draw conclusions from them, as a basis for their official
within the same building where the barber shop is located as long as the operator of the barber shop and the room action and to exercise discretion of a judicial nature.
where massaging is conducted is the same person." 1 As noted in the appealed order, petitioners-appellants admitted
that criminal cases for the violation of this ordinance had been previously filed and decided. Undoubtedly, the BSP Monetary Board is a quasi-,judicial agency exercising quasi-,judicial powers or
functions.1âwphi1 As aptly observed by the Court of Appeals, the BSP Monetary Board is an independent central
Even if such were not the case, the attack against the validity cannot succeed. As pointed out in the brief of monetary authority and a body corporate with fiscal and administrative autonomy, mandated to provide policy
respondents-appellees, it is a police power measure. The objectives behind its enactment are: "(1) To be able to directions in the areas of money, banking, and credit.
impose payment of the license fee for engaging in the business of massage clinic under Ordinance No. 3659 as
amended by Ordinance 4767, an entirely different measure than the ordinance regulating the business of A priori, having established that the BSP Monetary Board is indeed a quasi-judicial body exercising quasi-judicial
barbershops and, (2) in order to forestall possible immorality which might grow out of the construction of separate functions, then its decision in MB Resolution No. 1139 cannot be the proper subject of declaratory relief.
rooms for massage of customers." 3 This Court has been most liberal in sustaining ordinances based on the general
welfare clause.
Lastly, also worth noting is the fact that the court a quo's Order dated September 24, 2007, which dismissed
respondent's petition for declaratory relief, had long become final and executory.
G.R. No. 189571               January 21, 2015

G.R. NO. 165001             January 31, 2007

THE HONORABLE MONETARY BOARD and GAIL U. FULE, Director, Supervision and Examination
Department II, and BANGKO SENTRAL NG PILIPINAS, Petitioners,
vs. NEW FRONTIER SUGAR CORPORATION, Petitioner,
PHILIPPINE VETERANS BANK, Respondent. vs.
REGIONAL TRIAL COURT, BRANCH 39, ILOILO CITY and EQUITABLE PCI BANK, Respondents.

Section 1, Rule 63 of the Rules of Court governs petitions for declaratory relief, viz.:
SECTION 1. Who may file petition. – Any person interested under a deed, will, contract or other written instrument, Nevertheless, the suspension of the enforcement of all claims against the corporation is subject to the rule that it
whose rights are affected by a statute, executive order or regulation, ordinance, or any other governmental shall commence only from the time the Rehabilitation Receiver is appointed. In this case, respondent bank
regulation may, before breach or violation thereof, bring an action in the appropriate Regional Trial Court to instituted the foreclosure proceedings against petitioner’s properties on March 13, 2002 and a Certificate of Sale at
determine any question of construction or validity arising, and for a declaration of his rights or duties, thereunder. Public Auction was issued on May 6, 2002, with respondent bank as the highest bidder. The mortgage on petitioner’s
chattels was likewise foreclosed and the Certificate of Sale was issued on May 14, 2002. It also appears that titles
over the properties have already been transferred to respondent bank.17
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 On the other hand, the petition for corporate rehabilitation was filed only on August 14, 2002 and the Rehabilitation
only issue that may be raised in such a petition is the question of construction or validity of provisions in an Receiver appointed on August 20, 2002. Respondent bank, therefore, acted within its prerogatives when it foreclosed
instrument or statute.9 Ergo, the Court, in CJH Development Corporation v. Bureau of Internal Revenue, 10 held that in and bought the property, and had title transferred to it since it was made prior to the appointment of a rehabilitation
the same manner that court decisions cannot be the proper subjects of a petition for declaratory relief, decisions of receiver.
quasijudicial agencies cannot be subjects of a petition for declaratory relief for the simple reason that if a party is not
agreeable to a decision either on questions of law or of fact, it may avail of the various remedies provided by the Consequently, the CA was correct in upholding the RTC’s dismissal of the petition for rehabilitation in view of the fact
Rules of Court. that the titles to petitioner’s properties have already passed on to respondent bank and petitioner has no more assets
to speak of, specially since petitioner does not dispute the fact that the properties which were foreclosed by
In view of the foregoing, the decision of the BSP Monetary Board cannot be a proper subject matter for a petition for respondent bank comprise the bulk, if not the entirety, of its assets.
declaratory relief since it was issued by the BSP Monetary Board inthe exercise of its quasi-judicial powers or
functions. In the present case, the petition for rehabilitation did not run its full course but was dismissed by the RTC after due
consideration of the pleadings filed before it. On this score, the RTC cannot be faulted for its summary dismissal, as it
is tantamount to a finding that there is no merit to the petition.

8
The CA also correctly ruled that petitioner availed of the wrong remedy when it filed a special civil action for certiorari CORDOVA, EDWIN DEPETILLO, ROMULO FERRY, LEONISA GABRIEL, MA. FE GABRIEL, SALOME CORDOVA,
with the CA under Rule 65 of the Rules of Court. ELEN JACOB, JEREMIAS JACOB, OLIVIA LERIN, CRISELDA MADEJA, JOMARI MANONG, NESTOR MANONG,
VALENTIN MANONG, EDMUNDO/FELY MINA, TEDDY PARUAN, SALVACION PASCUA, ROMMEL POLISTICO,
Certiorari is a remedy for the correction of errors of jurisdiction, not errors of judgment. It is an original and DANIEL/NANCY PRADO, ARMANDO ROMERO, SANCHO VILLAFUERTE, and FERNANDO YAMID, Petitioners,
independent action that was not part of the trial that had resulted in the rendition of the judgment or order vs.
complained of. More importantly, since the issue is jurisdiction, an original action for certiorari may be directed CECILIA B. PALISOC, MARINA B. MATA and REYNALDO T. NEPOMUCENO, Respondents.
against an interlocutory order of the lower court prior to an appeal from the judgment; or where there is no appeal
or any plain, speedy or adequate remedy. A petition for certiorari should be filed not later than sixty days from the Under Section 19,10 Rule 70 of the Revised Rules on Civil Procedure, a judgment on a forcible entry and detainer
notice of judgment, order, or resolution, and a motion for reconsideration is generally required prior to the filing of a action is immediately executory to avoid further injustice to a lawful possessor, and the court’s duty to order the
petition for certiorari, in order to afford the tribunal an opportunity to correct the alleged errors.29 execution is practically ministerial.11 The defendant may stay it only by (a) perfecting an appeal; (b) filing a
supersedeas bond; and (c) making a periodic deposit of the rental or reasonable compensation for the use and
The Omnibus Order dated January 13, 2003 issued by the RTC is a final order since it terminated the proceedings occupancy of the property during the pendency of the appeal. 12 Once the Regional Trial Court decides on the appeal,
and dismissed the case before the trial court; it leaves nothing more to be done. As such, petitioner’s recourse is to such decision is immediately executory under Section 21, 13 Rule 70, without prejudice to an appeal, via a petition for
file an appeal from the Omnibus Order. review, before the Court of Appeals or Supreme Court.14

However, it should be noted that the Court issued A.M. No. 04-9-07-SC on September 14, 2004, clarifying the proper However, petitioners failed to file a petition for review. Records show that petitioners received on March 12, 2003 the
mode of appeal in cases involving corporate rehabilitation and intra-corporate controversies. It is provided therein RTC decision denying their motion for reconsideration. They had until March 27, 2003 to file a petition for review
that all decisions and final orders in cases falling under the Interim Rules of Corporate Rehabilitation and the Interim before the Court of Appeals. Instead, they filed a petition for certiorari and prohibition on April 10, 2003. In said
Rules of Procedure Governing Intra-Corporate Controversies under Republic Act No. 8799 shall be appealed to the CA petition, which is still pending, petitioners contended that the RTC committed grave abuse of discretion in affirming
through a petition for review under Rule 43 of the Rules of Court to be filed within fifteen (15) days from notice of the MeTC decision and insisted that the latter court had no jurisdiction over the complaint.
the decision or final order of the RTC.
The remedy to obtain reversal or modification of the judgment on the merits in the instant case is appeal. This holds
G.R. No. 181642               January 29, 2009 true even if the error ascribed to the court rendering the judgment is its lack of jurisdiction over the subject matter,
or the exercise of power in excess thereof, or grave abuse of discretion in the findings of fact or of law set out in the
decision. The existence and availability of the right of appeal prohibits the resort to certiorari  because one of the
RUFINO S. CAMUTIN, EDDIE P. CAMUTIN, GINA P. CAMUTIN, represented by NOMINARIO SARIA, as requirements for the latter remedy is that "there should be no appeal."15
Attorney-in-fact, Petitioners,
vs.
SPS. NORBERTO POTENTE, and PASCUALA POTENTE, Respondents Clearly, petitioners’ petition for certiorari before the Court of Appeals was filed as a substitute for the lost remedy of
appeal. Certiorari is not and cannot be made a substitute for an appeal where the latter remedy is available but was
lost through fault or negligence.16 Thus, the filing of the petition for certiorari did not prevent the RTC decision from
Certiorari is an extraordinary remedy available only when there is no appeal, nor any plain, speedy, and adequate becoming final and executory.17 The RTC acted correctly when it remanded the case to the court of origin in the order
remedy in the ordinary course of law.18 While a petition for certiorari is not allowed against any interlocutory order dated April 11, 2003.18
issued by the court in the unlawful detainer or ejectment case,19 in the case at bar, the filing of a petition for
certiorari challenging the MTC’s Orders dated 5 June 2007 and 16 August 2007 cannot be deemed a dilatory remedy
resorted to by petitioners. On the contrary, sustaining the MTC’s orders would unnecessarily and unfairly delay the G.R. No. 108619 July 31, 1997
unlawful detainer case, a result contrary to the rules’ objective of speedy disposition of cases. Petitioners could also
not appeal from the orders of the MTC because these only ordered the indefinite suspension and archiving of the EPIFANIO LALICAN, petitioner,
case. The case was not resolved on the merits so there is actually no decision from which petitioners can appeal. vs.
Thus, the RTC could have validly ruled on the petition for certiorari instead of dismissing it on the ground that it is a HON. FILOMENO A. VERGARA, Presiding Judge, RTC Branch 52, Puerto Princesa City and PEOPLE OF THE
prohibited pleading. PHILIPPINES, respondents.

However, the MTC’s revival of the unlawful detainer case and its subsequent dismissal thereof on the grounds The Court, therefore, finds that the lower court did not gravely abuse its discretion in denying the quashal of the
aforestated have rendered the resolution of the present petition for review superfluous and unnecessary. information. The petition simply has no legal basis. Certiorari may be issued only where it is clearly shown that there
is patent and gross abuse of discretion as to amount to an evasion of positive duty or to virtual refusal to perform a
G.R. No. 157985 December 2, 2005 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. 11 Grave abuse of discretion implies a capricious and
whimsical exercise of power. 12
ZENAIDA BUGARIN, VIOLETA ABANO, LIZA ABAYATA, ANTONIO ALEGRE, REMEDIOS ALEGRE, CHRIS
ANASCO, JEFFREY ARQUILLOS, LOURDES BAGARESE, EUGENIA BARAQUIL, PRECIOS BASOY, RANNY
BASOY, FELY BERMEJO, CARLOS BO, JUN BO, ALEX BORRES, ANNA MARIE CORDOVA, ESPERANZE On the other hand, certiorari may not be availed of where it is not shown that the respondent court lacked or
exceeded its jurisdiction or committed grave abuse of discretion. 13 Where the court has jurisdiction over the case,

9
even if its findings are not correct, its questioned acts would at most constitute errors of law and not abuse of which the petitioner had no opportunity to object; and (i) where the issue raised is one purely of law or public
discretion correctible by certiorari. 14 As this Court said: interest is involved.56
. . . When a court exercises its jurisdiction, an error committed while so engaged does not deprive it of the
jurisdiction being exercised when the error is committed. If it did, every error committed by a court would deprive As will be shown later, the March 24, 2003 Order of the trial court granting petitioner’s plea for a writ of preliminary
it of its jurisdiction and every erroneous judgment would be a void judgment. This cannot be allowed. The injunction was issued with grave abuse of discretion amounting to excess or lack of jurisdiction and thus a nullity. If
administration of justice would not survive such a rule. Consequently, an error of judgment that the court may the trial court issues a writ of preliminary injunction despite the absence of proof of a legal right and the injury
commit in the exercise of its jurisdiction is not correctible through the original civil action of certiorari. 15 sustained by the plaintiff, the writ is a nullity.57

In other words, certiorari will issue only to correct errors of jurisdiction and not to correct errors of procedure or Petitioners Are Not Entitled to a Writ of Preliminary Prohibitory Injunction
mistakes in the judge's findings and conclusions. 16

The plaintiff praying for a writ of preliminary injunction must further establish that he or she has a present and
The unavailability of the writ of certiorari, and even that of prohibition, in this case is borne out of the fact that what unmistakable right to be protected; that the facts against which injunction is directed violate such right;59 and there
petitioner considers as grave abuse of discretion in this case is the denial of his motion to quash the information filed is a special and paramount necessity for the writ to prevent serious damages. In the absence of proof of a legal right
against him and three others. This Court has consistently defined the proper procedure in case of denial of a motion and the injury sustained by the plaintiff, an order for the issuance of a writ of preliminary injunction will be nullified.
to quash. The accused has to enter a plea, go to trial without prejudice on his part to present the special defenses he Thus, where the plaintiff’s right is doubtful or disputed, a preliminary injunction is not proper. The possibility of
had invoked in his motion and, if after trial on the merits, an adverse decision is rendered, to appeal therefrom in the irreparable damage without proof of an actual existing right is not a ground for a preliminary injunction.60
manner authorized by law. 17

However, to establish the essential requisites for a preliminary injunction, the evidence to be submitted by the
Certiorari is not the proper remedy where a motion to quash an information is denied. That the appropriate recourse plaintiff need not be conclusive and complete.61 The plaintiffs are only required to show that they have an ostensible
is to proceed to trial and in case of conviction, to appeal such conviction, as well as the denial of the motion to right to the final relief prayed for in their complaint.
quash, is impelled by the fact that a denial of a motion to quash is an interlocutory procedural aspect which cannot
be appealed nor can it be the subject of a petition for certiorari. 18 The remedies of appeal and certiorari are mutually
exclusive and not alternative or successive. 19 An interlocutory order may be assailed by certiorari or prohibition only We agree with respondent’s contention that as creditor-mortgagee, it has the right under the real estate mortgage
when it is shown that the court acted without or in excess of jurisdiction or with grave abuse of discretion.  contract and the amendment thereto to foreclose extrajudicially, the real estate mortgage and sell the property at
public auction, considering that petitioners had failed to pay their loans, plus interests and other incremental
amounts as provided for in the deeds.
G.R. No. 167434 February 19, 2007

It was the burden of petitioners, as plaintiffs below, to adduce preponderant evidence to prove their claim that
SPOUSES RAMON M. NISCE and A. NATIVIDAD PARAS-NISCE, Petitioners, respondent bank was the debtor of petitioner Natividad Nisce relative to her dollar deposit with PCIB, and later
vs. transferred to PCI Capital in Hong Kong, a subsidiary of respondent Bank. Petitioners, however, failed to discharge
EQUITABLE PCI BANK, INC., Respondent. their burden.

The Ruling of the Court G.R. No. 192986               January 15, 2013

The Petition in the Court of Appeals Not Premature ADVOCATES FOR TRUTH IN LENDING, INC. and EDUARDO B. OLAGUER, Petitioners,
vs.
The general rule is that before filing a petition for certiorari under Rule 65 of the Rules of Court, the petitioner is BANGKO SENTRAL MONETARY BOARD, represented by its Chairman, GOVERNOR ARMANDO M.
mandated to comply with a condition precedent: the filing of a motion for reconsideration of the assailed order, and TETANGCO, JR., and its incumbent members: JUANITA D. AMATONG, ALFREDO C. ANTONIO, PETER FA
the subsequent denial of the court a quo. It must be stressed that a petition for certiorari is an extraordinary remedy VILA, NELLY F. VILLAFUERTE, IGNACIO R. BUNYE and CESAR V. PURISIMA, Respondents.
and should be filed only as a last resort. The filing of a motion for reconsideration is intended to afford the public
respondent an opportunity to correct any actual error attributed to it by way of re-examination of the legal and The decision on whether or not to accept a petition for certiorari, as well as to grant due course thereto, is addressed
factual issues.55 However, the rule is subject to the following recognized exceptions: to the sound discretion of the court.15 A petition for certiorari being an extraordinary remedy, the party seeking to
(a) where the order is a patent nullity, as where the court a quo has no jurisdiction; (b) where the questions raised avail of the same must strictly observe the procedural rules laid down by law, and non-observance thereof may not
in the certiorari proceeding have been duly raised and passed upon by the lower court, or are the same as those be brushed aside as mere technicality.16
raised and passed upon in the lower court; (c) where there is an urgent necessity for the resolution of the question
and any further delay would prejudice the interests of the Government or of the petitioner or the subject matter of
the action is perishable; (d) where, under the circumstances, a motion for reconsideration would be useless; (e) As provided in Section 1 of Rule 65, a writ of certiorari is directed against a tribunal exercising judicial or quasi-
where petitioner was deprived of due process and there is extreme urgency for relief; (f) where, in a criminal case, judicial functions.17 Judicial functions are exercised by a body or officer clothed with authority to determine what the
relief from an order of arrest is urgent and the granting of such relief by the trial court is improbable; (g) where the law is and what the legal rights of the parties are with respect to the matter in controversy. Quasi-judicial function is
proceedings in the lower court are a nullity for lack of due process; (h) where the proceedings was ex parte or in a term that applies to the action or discretion of public administrative officers or bodies given the authority to

10
investigate facts or ascertain the existence of facts, hold hearings, and draw conclusions from them as a basis for First, the respondents neither acted in any judicial or quasi-judicial capacity nor arrogated unto themselves any
their official action using discretion of a judicial nature.18 judicial or quasi-judicial prerogatives. A petition for certiorari under Rule 65 of the 1997 Rules of Civil Procedure is a
special civil action that may be invoked only against a tribunal, board, or officer exercising judicial or quasi-judicial
The CB-MB (now BSP-MB) was created to perform executive functions with respect to the establishment, operation or functions.
liquidation of banking and credit institutions, and branches and agencies thereof.19 It does not perform judicial or
quasi-judicial functions. Certainly, the issuance of CB Circular No. 905 was done in the exercise of an executive Section 1, Rule 65 of the 1997 Rules of Civil Procedure provides:
function. Certiorari will not lie in the instant case.20 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
B. Petitioners have no locus standi to file the Petition 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
Locus standi is defined as "a right of appearance in a court of justice on a given question." In private suits, Section 2, officer, and granting such incidental reliefs as law and justice may require.
Rule 3 of the 1997 Rules of Civil Procedure provides that "every action must be prosecuted or defended in the name
of the real party in interest," who is "the party who stands to be benefited or injured by the judgment in the suit or
the party entitled to the avails of the suit." Succinctly put, a party’s standing is based on his own right to the relief Elsewise stated, for a writ of certiorari to issue, the following requisites must concur: (1) it must be directed against
sought.21 a tribunal, board, or officer exercising judicial or quasi-judicial functions; (2) the tribunal, board, or officer must have
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 or any plain, speedy, and adequate remedy in the ordinary course of law.
Even in public interest cases such as this petition, the Court has generally adopted the "direct injury" test that the
person who impugns the validity of a statute must have "a personal and substantial interest in the case such that he
has sustained, or will sustain direct injury as a result." 22 Thus, while petitioners assert a public right to assail CB A respondent is said to be exercising  judicial function  where he has  the power to determine what the law is and what
Circular No. 905 as an illegal executive action, it is nonetheless required of them to make out a sufficient interest in the legal rights of the parties are, and then undertakes to determine these questions and adjudicate upon the rights
the vindication of the public order and the securing of relief. It is significant that in this petition, the petitioners do of the parties.
not allege that they sustained any personal injury from the issuance of CB Circular No. 905.
Quasi-judicial function,  on the other hand, is "a term which applies to the actions, discretion, etc., of public
Petitioners also do not claim that public funds were being misused in the enforcement of CB Circular No. 905. The administrative officers or bodies … required to investigate facts or ascertain the existence of facts, hold hearings, and
Petition raises no issues of transcendental importance. In the instant case, there is no allegation of misuse of public draw conclusions from them as a basis for their official action and to exercise discretion of a judicial nature."
funds in the implementation of CB Circular No. 905. Neither were borrowers who were actually affected by the
suspension of the Usury Law joined in this petition. Absent any showing of transcendental importance, the petition Before a tribunal, board, or officer may exercise judicial or quasi-judicial acts, it is necessary that there be a law that
must fail. gives rise to some specific rights of persons or property under which adverse claims to such rights are made, and the
controversy ensuing therefrom is brought before a tribunal, board, or officer clothed with power and authority to
G.R. No. 193978               February 28, 2012 determine the law and adjudicate the respective rights of the contending parties.

JELBERT B. GALICTO, Petitioner, The respondents do not fall within the ambit of tribunal, board, or officer exercising judicial or quasi-judicial
vs. functions.  As correctly pointed out by the respondents, the enactment by the City Council of Manila of the assailed
H.E. PRESIDENT BENIGNO SIMEON C. AQUINO III, in his capacity as President of the Republic of the ordinance and the issuance by respondent Mayor of the questioned executive order were done in the exercise of
Philippines; ATTY. PAQUITO N. OCHOA, JR., in his capacity as Executive Secretary; and FLORENCIO B. legislative and executive functions, respectively, and not of judicial or quasi-judicial functions. On this score
ABAD, in his capacity as Secretary of the Department of Budget and Management, Respondents. alone, certiorari will not lie.

A. Certiorari is not the proper remedy. Second, although the instant petition is styled as a petition for certiorari, in essence, it seeks the declaration by this
Court of the unconstitutionality or illegality of the questioned ordinance and executive order. It, thus, partakes of the
nature of a petition for declaratory relief over which this Court has only appellate, not original, jurisdiction. Section 5,
Under the Rules of Court, petitions for Certiorari and Prohibition are availed of to question judicial, quasi-judicial and
Article VIII of the Constitution provides:
mandatory acts. Since the issuance of an EO is not judicial, quasi-judicial or a mandatory act, a petition for certiorari
Sec. 5. The Supreme Court shall have the following powers:
and prohibition is an incorrect remedy; instead a petition for declaratory relief under Rule 63 of the Rules of Court,
(1) Exercise original jurisdiction over cases affecting ambassadors, other public ministers and consuls, and over
filed with the Regional Trial Court (RTC), is the proper recourse to assail the validity of EO 7:
petitions for certiorari, prohibition, mandamus, quo warranto, and habeas corpus.
Section 1. Who may file petition. Any person interested under a deed, will, contract or other written instrument,
(2) Review, revise, reverse, modify, or affirm on appeal or certiorari as the law or the Rules of Court may
whose rights are affected by a statute, executive order or regulation, ordinance, or any other governmental
provide, final judgments and orders of lower courts in:
regulation may, before breach or violation thereof, bring an action in the appropriate Regional Trial Court to
(a) All cases in which the constitutionality or validity of any treaty, international or executive agreement, law,
determine any question of construction or validity arising, and for a declaration of his rights or duties, thereunder.
presidential decree, proclamation, order, instruction, ordinance, or regulation is in question. (Italics supplied).
(Emphases ours.)

11
G.R. Nos. 139913 & 140159               January 16, 2004 technicalities. Should tenancy relationship be duly proven, the respondent as a tenant should be protected in keeping
with the social justice precept enshrined in the Constitution. 40 Also noteworthy is the fact that the petition for
TERESITA S. DAVID, BENJAMIN S. DAVID,PACIFICO S. DAVID, NEMESIO S. DAVID, CELINE S. DAVID, prohibition was filed within the reglementary period to appeal; hence, it cannot be claimed that the same was used
CRISTINA S. DAVID, PAULINA S. DAVID, and LEONIE S. DAVID-DE LEON, Petitioners, as substitute for a lost appeal.
vs.
AGUSTIN RIVERA, Respondent. G.R. No. 147956             February 16, 2005

It is clear that the respondent filed the petition for prohibition to correct what he perceived was an erroneous ESPERANZA S. LONGINO, petitioner,
assumption of jurisdiction by the MCTC. Indeed, the propriety of the recourse to the RTC for a writ of prohibition is vs.
beyond cavil in view of the following considerations: ATTY. LINA A. GENERAL, OIC, Commission Member III; ATTY. NOEL A. GALAROSA, OIC, Commission
Member III; ATTY. LUZ SARMIENTO, OIC, Office of the Executive Director, all of COSLAP; JUDGE JAIME F.
First.  The peculiar circumstances obtaining in this case, where two tribunals exercised jurisdiction over two cases BAUTISTA of the Regional Trial Court, Branch 75, Valenzuela City; and ELSA P. SERRANO, respondents.
involving the same subject matter, issue, and parties, and ultimately rendered conflicting decisions, clearly makes
out a case for prohibition. The MCTC manifestly took cognizance of the case for ejectment pursuant to Section 33 Rule 65, Section 2 of the Rules of Court provides:
of Batas Pambansa Blg. 129,28 as amended. On the other hand, the ratiocination of the DARAB, which the respondent Section 2. Petition for prohibition. – When the proceedings of any tribunal, corporation, board, or person, whether
echoes, is that the case falls squarely within its jurisdiction as it arose out of, or was connected with, agrarian exercising functions judicial or ministerial, are without or in excess of its or his jurisdiction, or with grave abuse of
relations. The respondent also points out that his right to possess the land, as a registered tenant, was submitted for discretion, and there is no appeal or any other plain, speedy, and adequate remedy in the ordinary course of law, a
determination before the PARAB prior to the filing of the case for ejectment. 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 defendant to desist from further proceedings in the action or
Indeed, Section 50 of R.A. 665729 confers on the Department of Agrarian Reform (DAR) quasi-judicial powers to matter specified therein.
adjudicate agrarian reform matters.30 In the process of reorganizing the DAR, Executive Order No. 129-A31 created the
DARAB to assume the powers and functions with respect to the adjudication of agrarian reform cases. The petition shall be accompanied by a certified true copy of the judgment or order subject thereof, together with
copies of all pleadings and documents relevant and pertinent thereto.
Prescinding from the foregoing, it is safe to conclude that the existence of prior agricultural tenancy relationship, if
true, will divest the MCTC of its jurisdiction the previous juridical tie compels the characterization of the controversy The principal purpose for the writ of prohibition is to prevent an encroachment, excess, usurpation or assumption of
as an "agrarian dispute." Agrarian dispute refers to any controversy relating to tenurial arrangements... This jurisdiction on the part of an inferior court or quasi-judicial tribunal. It is granted when it is necessary for the orderly
jurisdiction does not require the continuance of the relationship of landlord and tenant — at the time of administration of justice, or prevent the use of the strong arm of the law in an oppressive or vindictive manner, or
the dispute. The same may have arisen, and often times arises, precisely from the previous termination of such multiplicity of actions.28 The writs of certiorari and prohibition, for that matter, are intended to annul or void
relationship. If the same existed immediately, or shortly, before the controversy and the subject-matter thereof is proceedings in order to insure the fair and orderly administration of justice.29
whether or not said relationship has been lawfully terminated, or if the dispute otherwise springs or originates
from the relationship of landlord and tenant, the litigation is (then) cognizable only by the Court of
For a party to be entitled to a writ of prohibition, he must establish the following requisites: (a) it must be directed
Agrarian Relations . . .34
against a tribunal, corporation, board or person exercising functions, judicial or ministerial; (b) the tribunal,
corporation, board or person has acted without or in excess of its jurisdiction, or with grave abuse of discretion; and
With the facts doubtlessly presenting a question of jurisdiction, it follows that the respondent has availed of the
(c) there is no appeal or any other plain, speedy, and adequate remedy in the ordinary course of law.30
proper, speedy and adequate remedy which is the special civil action of prohibition. It is a settled rule that prohibition
is the proper remedy to afford relief against usurpation of jurisdiction or power by an inferior court, 35 or when, in the
exercise of jurisdiction in handling matters clearly within its cognizance the inferior court transgresses the bounds For grave abuse of discretion to prosper as a ground for prohibition, it must first be demonstrated that the lower
prescribed to it by the law, or where there is no adequate remedy available in the ordinary course of law by which court or tribunal has exercised its power in an arbitrary and despotic manner, by reason of passion or personal
such relief can be obtained."36 The purpose of a writ of prohibition is to keep a lower court within the limits of its hostility, and it must be patent and gross as would amount to an evasion or to a unilateral refusal to perform the
jurisdiction in order to maintain the administration of justice in orderly channels.37 duty enjoined or to act in contemplation of law. Excess of jurisdiction signifies that the court, board or office has
jurisdiction over the case but has transcended the same or acted without authority. 31 The writ of prohibition will not
lie to enjoin acts already done.32 However, as an exception to the rule on mootness, courts will decide a question
Second. While appeal is the recognized remedy to question the judgment of an inferior court, this does not detract
otherwise moot if it is capable of repetition yet evading review.33
from the authority of a higher court to issue a writ of prohibition to restrain the inferior court, among other instances,
from proceeding further on the ground that it heard and decided the case without jurisdiction.38 Since the right to
prohibition is defeated not by the existence, but by the adequacy, of a remedy by appeal, it may accordingly be In a case where a lower court or quasi-judicial body commits an error in the excess of its jurisdiction, if such error is
granted where the remedy by appeal is not plain, speedy or adequate.39 one of judgment, it is revocable only by appeal. On the other hand, if the act complained of was issued by such court
or body with grave abuse of discretion, which is tantamount to lack or in excess of jurisdiction, the remedy of the
aggrieved party is to file a petition for certiorari and/or prohibition under Rule 65 of the Rules of Court. 34 Indeed, a
To say, as the petitioners argue, that the MCTC Decision has already attained finality because the respondent opted
decision of a court without jurisdiction is null and void. It could never become final and executory; hence, appeal
to file a petition for prohibition instead of an appeal is to sacrifice needlessly respondent’s right at the altar of

12
therefrom by writ of error is out of the question. The aggrieved party should file a petition for certiorari or prohibition HOLY SPIRIT HOMEOWNERS ASSOCIATION, INC. and NESTORIO F. APOLINARIO, in his personal capacity
under Rule 65 of the Rules of Court.35 and as President of Holy Spirit Homeowners Association, Inc., Petitioners,
vs.
A remedy is considered plain, speedy and adequate if it will promptly relieve the petitioner from the injurious effects SECRETARY MICHAEL DEFENSOR, in his capacity as Chairman of the Housing and Urban Development
of the judgment or rule, order or resolution of the lower court or agency. 36 While ordinarily, certiorari or prohibition Coordinating Council (HUDCC), ATTY. EDGARDO PAMINTUAN, in his capacity as General Manager of the
for that matter is unavailing where the appeal period had lapsed, the same may be availed of whereas in the present National Housing Authority (NHA), MR. PERCIVAL CHAVEZ, in his capacity as Chairman of the
case, public welfare and the administration of public policy dictates; where the broader interest of justice so requires; Presidential Commission for the Urban Poor (PCUP), MAYOR FELICIANO BELMONTE, in his capacity as
where the writs issued are null and void; where the questioned order amounts to an oppressive excess of judicial Mayor of Quezon City, SECRETARY ELISEA GOZUN, in her capacity as Secretary of the Department of
authority.37 Environment and Natural Resources (DENR) and SECRETARY FLORENTE SORIQUEZ, in his capacity as
Secretary of the Department of Public Works and Highways (DPWH) as ex-officio members of the
NATIONAL GOVERNMENT CENTER ADMINISTRATION COMMITTEE, Respondents.
In the present case, the petition for prohibition filed with the CA by the petitioner could have been dismissed by the
CA because the structures on the property had already been demolished; hence, the acts sought to be enjoined by
the petitioner had already been effected by the respondent sheriff. For another reason, the lease contract of the Administrative agencies possess quasi-legislative or rule-making powers and quasi-judicial or administrative
petitioner and the PNR had not been renewed after its expiration on January 26, 2000. Manifestly, the petitioner was adjudicatory powers. Quasi-legislative or rule-making power is the power to make rules and regulations which results
obliged to vacate the property and remove her structures thereon. Nevertheless, the CA took cognizance of the in delegated legislation that is within the confines of the granting statute and the doctrine of non-delegability and
petition and resolved the same on its merits, precisely because the issues raised therein, namely, whether the separability of powers. 12
COSLAP had jurisdiction over the complaint of the private respondent; and whether the COSLAP exceeded its
jurisdiction in declaring the private respondent the legal possessor of the property and of having priority in leasing In questioning the validity or constitutionality of a rule or regulation issued by an administrative agency, a party need
the subject property raised in the petition, were substantial. not exhaust administrative remedies before going to court. This principle, however, applies only where the act of the
administrative agency concerned was performed pursuant to its quasi-judicial function, and not when the assailed act
We agree with the petitioner that the CA erred in ruling that the COSLAP had jurisdiction on the complaint of the pertained to its rule-making or quasi-legislative power. 13
private respondent and that the latter was the legal possessor and had preferential right to lease the property.
Consequently, the Resolution of the COSLAP dated December 16, 1999, as well as the writ issued by it are null and The assailed IRR was issued pursuant to the quasi-legislative power of the Committee expressly authorized by R.A.
void. No. 9207. The petition rests mainly on the theory that the assailed IRR issued by the Committee is invalid on the
ground that it is not germane to the object and purpose of the statute it seeks to implement. Where what is assailed
Under the law, the COSLAP has two options in acting on a land dispute or problem lodged before it, namely, (a) refer is the validity or constitutionality of a rule or regulation issued by the administrative agency in the performance of its
the matter to the agency having appropriate jurisdiction for settlement/resolution; or (b) assume jurisdiction if the quasi-legislative function, the regular courts have jurisdiction to pass upon the same. 14
matter is one of those enumerated in paragraph 2(a) to (e) of the law, if such case is critical and explosive in nature,
taking into account the large number of the parties involved, the presence or emergence of social tension or unrest, Since the regular courts have jurisdiction to pass upon the validity of the assailed IRR issued by the Committee in the
or other similar critical situations requiring immediate action. In resolving whether to assume jurisdiction over a case exercise of its quasi-legislative power, the judicial course to assail its validity must follow the doctrine of hierarchy of
or to refer the same to the particular agency concerned, the COSLAP has to consider the nature or classification of courts. Although the Supreme Court, Court of Appeals and the Regional Trial Courts have concurrent jurisdiction to
the land involved, the parties to the case, the nature of the questions raised, and the need for immediate and urgent issue writs of certiorari, prohibition, mandamus, quo warranto, habeas corpus  and injunction, such concurrence does
action thereon to prevent injuries to persons and damage or destruction of property. The law does not vest not give the petitioner unrestricted freedom of choice of court forum. 15
jurisdiction on the COSLAP over any land dispute or problem.
A direct invocation of the Court’s original jurisdiction to issue these writs should be allowed only when there are
The dispute between the parties was not critical and explosive in nature so as to generate social tension or unrest, or special and important reasons therefor, clearly and specifically set out in the petition. 17
a critical situation which required immediate action. The issues raised by the parties in their pleadings involved the
application of the New Civil Code in relation to the Charter of the PNR, which clearly do involve the application of the A perusal, however, of the petition for prohibition shows no compelling, special or important reasons to warrant the
expertise of the COSLAP. Court’s taking cognizance of the petition in the first instance. Petitioner also failed to state any reason that precludes
the lower courts from passing upon the validity of the questioned IRR.
The Court, likewise, rules that the COSLAP had no jurisdiction over the issues raised by the parties because as early
as January 19, 1999, the Board of Directors of the PNR had approved Resolution No. 99-03, directing the PNR A petition for prohibition is also not the proper remedy to assail an IRR issued in the exercise of a quasi-legislative
Management to desist from selling or leasing its properties needed for the right-of-way of its North Rail Project. function. Prohibition is an extraordinary writ directed against any tribunal, corporation, board, officer or person,
Notwithstanding the Resolution of the Board of Directors, the COSLAP declared the private respondent the legal whether exercising judicial, quasi-judicial or ministerial functions, ordering said entity or person to desist from further
possessor of the property and had the priority to lease the same. When to lease property owned by it, whom to lease proceedings when said proceedings are without or in excess of said entity’s or person’s jurisdiction, or are
such property, as well as the terms and conditions thereof, are matters addressed to the PNR. accompanied with grave abuse of discretion, and there is no appeal or any other plain, speedy and adequate remedy
in the ordinary course of law. 21 Prohibition lies against judicial or ministerial functions, but not against legislative or
G.R. No. 163980 August 3, 2006 quasi-legislative functions. Generally, the purpose of a writ of prohibition is to keep a lower court within the limits of
its jurisdiction in order to maintain the administration of justice in orderly channels. 22 Prohibition is the proper

13
remedy to afford relief against usurpation of jurisdiction or power by an inferior court, or when, in the exercise of Considering that the legality of the plebiscite itself is challenged for non-compliance with constitutional requisites, the
jurisdiction in handling matters clearly within its cognizance the inferior court transgresses the bounds prescribed to fact that such plebiscite had been held and a new province proclaimed and its officials appointed, the case before Us
it by the law, or where there is no adequate remedy available in the ordinary course of law by which such relief can cannot truly be viewed as already moot and academic. Continuation of the existence of this newly proclaimed
be obtained. 23 Where the principal relief sought is to invalidate an IRR, petitioners’ remedy is an ordinary action for province which petitioners strongly profess to have been illegally born, deserves to be inquired into by this Tribunal
its nullification, an action which properly falls under the jurisdiction of the Regional Trial Court. In any case, so that, if indeed, illegality attaches to its creation, the commission of that error should not provide the very excuse
petitioners’ allegation that "respondents are performing or threatening to perform functions without or in excess of for perpetuation of such wrong.
their jurisdiction" may appropriately be enjoined by the trial court through a writ of injunction or a temporary
restraining order. In the light of the facts and circumstances alluded to by petitioners as attending to the unusually rapid creation of
the instant province of Negros del Norte after a swiftly scheduled plebiscite, this Tribunal has the duty to repudiate
G.R. No. 98310 October 24, 1996 and discourage the commission of acts which run counter to the mandate of our fundamental law, done by whatever
branch of our government. This Court gives notice that it will not look with favor upon those who may be hereafter
MATUGUINA INTEGRATED WOOD PRODUCTS, INC., petitioner, inclined to ram through all sorts of legislative measures and then implement the same with indecent haste, even if
vs. such acts would violate the Constitution and the prevailing statutes of our land.
The HON. COURT OF APPEALS, DAVAO ENTERPRISES CORPORATION, The HON. MINISTER, (NOW
SECRETARY) of NATURAL RESOURCES AND PHILLIP CO, respondents. The Court is prepared to declare the said plebiscite held on January 3, 1986 as null and void and violative of the
provisions of Sec. 3, Article XI of the Constitution. The Court is not, however, disposed to direct the conduct of a new
As observed by the appellate court, to writ: plebiscite, because We find no legal basis to do so. With constitutional infirmity attaching to the subject Batas
the appellant should have filed a Motion with the Minister with Notice to the appellee to include the latter as party Pambansa Big. 885 and also because the creation of the new province of Negros del Norte is not in accordance with
liable for the judgment in order to afford the appellee an opportunity to be heard on its liability for the judgment the criteria established in the Local Government Code, the factual and legal basis for the creation of such new
rendered against Ma. Milagros Matuguina doing business under the name Matuguina Logging Enterprises. 34 province which should justify the holding of another plebiscite does not exist.
Continuing, the said court stated further that:
Nevertheless, the failure to comply with the procedure in order to satisfy the requirements of due process was Whatever claim it has to validity and whatever recognition has been gained by the new province of Negros del Norte
cured by the present action for prohibition where the liability of appellee has been ventilated. because of the appointment of the officials thereof, must now be erased. That Negros del Norte is but a legal fiction
should be announced. Its existence should be put to an end as quickly as possible, if only to settle the complications
We do not agree. Essential, Prohibition is a remedy to prevent inferior courts, corporations, boards or persons from currently attending to its creation.
usurping or exercising a jurisdiction or power with which they have not been vested by law  35 As we have held
in Mafinco Trading Corporation vs. Ople, et al, 36 in a certiorari or prohibition case, only issues affecting the G.R. No. 193007               July 19, 2011
jurisdiction of the tribunal, board and offices involved may be resolved on the basis of undisputed facts.
RENATO V. DIAZ and AURORA MA. F. TIMBOL, Petitioners,
The issue of whether or not petitioner is an alter ego of Milagros Matuguina/MLE, is one of fact, and which should vs.
have been threshed out in the administrative proceedings, and not in the prohibition proceedings in the trial court, THE SECRETARY OF FINANCE and THE COMMISSIONER OF INTERNAL REVENUE, Respondents.
where it is precisely the failure of the respondent Minister of Natural Resources to proceed as mandated by law in the
execution of its order which is under scrutiny. On August 24, 2010 the Court issued a resolution, treating the petition as one for prohibition rather than one for
declaratory relief, the characterization that petitioners Diaz and Timbol gave their action. The government has sought
Assuming, arguendo, that prohibition is the proper remedy for determining the propriety of piercing the separate reconsideration of the Court’s resolution,7 however, arguing that petitioners’ allegations clearly made out a case for
personality of petitioner with its stockholders, the evidence presented at said trial does not warrant such action. declaratory relief, an action over which the Court has no original jurisdiction. The government adds, moreover, that
the petition does not meet the requirements of Rule 65 for actions for prohibition since the BIR did not exercise
In the case at bar, there is, insufficient basis for the appellate court's ruling that MIWPI is the same as Matuguina. judicial, quasi-judicial, or ministerial functions when it sought to impose VAT on toll fees. Besides, petitioners Diaz
and Timbol has a plain, speedy, and adequate remedy in the ordinary course of law against the BIR action in the
form of an appeal to the Secretary of Finance.
G.R. No. 73155 July 11, 1986

But there are precedents for treating a petition for declaratory relief as one for prohibition if the case has far-
PATRICIO TAN, FELIX FERRER, JUAN M. HAGAD, SERGIO HILADO, VIRGILIO GASTON, CONCHITA reaching implications and raises questions that need to be resolved for the public good.8 The Court has also held that
MINAYA, TERESITA ESTACIO, DESIDERIO DEFERIA, ROMEO GAMBOA, ALBERTO LACSON, FE HOFILENA, a petition for prohibition is a proper remedy to prohibit or nullify acts of executive officials that amount to usurpation
EMILY JISON, NIEVES LOPEZ AND CECILIA MAGSAYSAY, petitioners, of legislative authority.9
vs.
THE COMMISSION ON ELECTIONS and THE PROVINCIAL TREASURER OF NEGROS
OCCIDENTAL, respondents. Here, the imposition of VAT on toll fees has far-reaching implications. Its imposition would impact, not only on the
more than half a million motorists who use the tollways everyday, but more so on the government’s effort to raise
revenue for funding various projects and for reducing budgetary deficits.

14
To dismiss the petition and resolve the issues later, after the challenged VAT has been imposed, could cause more It would appear, therefore, that with the changes made and the accomplishments achieved, operations of the
mischief both to the tax-paying public and the government. A belated declaration of nullity of the BIR action would sequestered firms are no longer obstructed, production no longer delayed and funding is available.
make any attempt to refund to the motorists what they paid an administrative nightmare with no solution.
Indeed, if petitioners have obstructed the smooth operations" of the sequestered garment firms and "discredited
Although the petition does not strictly comply with the requirements of Rule 65, the Court has ample power to waive their Officer-in-Charge," might it not be preferable that they be out of the country to ensure the cessation of their
such technical requirements when the legal questions to be resolved are of great importance to the public. The same acts allegedly inimical to the operations of the sequestered garment firms?
may be said of the requirement of locus standi which is a mere procedural requisite.10
And yet, the PCGG has not given petitioners any opportunity to contest the Hold-Orders issued against them. After
G.R. No. 123899 August 30, 1996 their issuance, no hearing had been set; a request for the same had been disregarded.

ROSALINDA MAYUGA, Spouses ARNEL BUGAYONG and NENA BUGAYONG, LITA CHUA, Spouses BENJAMIN Under the environmental circumstances of the case, the Hold-Orders against petitioners preventing them "from
SANTOS and PURITA SANTOS, Spouses SANTIAGO and GLORIA REYES, SOLEDAD LABRADOR, EMILIA leaving the country cannot be prolonged indefinitely." The right to travel and to freedom of movement is a
CERVANTES, Spouses ERNESTO LABRADOR and LEONORA LABRADOR and RESTITUTO fundamental right guaranteed by the 1987 Constitution 5 and the Universal Declaration of Human Rights to which the
VALBUENA, petitioners, Philippines is a signatory. 6 That right extends to all residents regardless of nationality. And "everyone has the right
vs. to an effective remedy by the competent national tribunals for acts violating the fundamental rights granted him by
COURT OF APPEALS, HON. ROSMARI D. CARANDANG, and RPN REALTY, INC., respondents. the Constitution or by law. 7

Mandamus will lie to compel a judge or other public officer to perform a duty specifically enjoined by law once it is While such right is not absolute but must yield to the State's inherent police power upon which the Hold-Orders were
shown that the judge or public officer has unlawfully neglected the performance thereof. 15 A court neglects the premised, no "good reasons" have been advanced which could justify the continued enforcement of the Hold-Orders.
performance of its duties only when after demand has been made upon it, it refuses to perform the
same. 16 Petitioners have not shown that the trial court refused to accept the notice of appeal, much less denied said Petitioners are foreign nationals. Their 33% interest in the sequestered firms is recognized by the PCGG itself. There
notice. The order of the trial court dated January 3, 1996 merely granted private respondent's "Motion for the is no showing that those interests appear prima facie  to be ill-gotten wealth. No charges have been filed against
Declaration of Defendants as Non-underprivileged . . . and for the Issuance of an alias Writ of Execution." There is them before the Sandiganbayan. They face no criminal indictment nor have they been provisionally released on bail
nothing in it that expressly or impliedly denied petitioners' appeal from the Order denying relief from judgment. To that their right to travel might be restricted.
be sure, the notice of appeal at bar is not even subject to the approval of the trial court because it was deemed
perfected after the fifteenth day, i.e., the last day to appeal by both petitioners and private respondent. Likewise,
Although, as averred by respondents, the recognized rule is that, in the performance of an official duty or act
petitioners have not alleged that the trial court neglected to order the transmittal of the records to the Court of
involving discretion, the corresponding official can only be directed by mandamus to act but not to act one way or the
Appeals. We hold that petitioners have failed to prove their cause of action for mandamus, hence, the petition was
other, "yet it is not accurate to say that the writ will never issue to control his discretion. There is an exception to the
correctly dismissed by the Court of Appeals. 17
rule if the case is otherwise proper, as in cases of gross abuse of discretion, manifest injustice, or palpable excess of
authority. 8
G.R. No. 79484 December 7, 1987

In this case, for reasons already stated, we find that the PCGG acted with gross abuse of discretion in maintaining
KANT KWONG and YIM KAM SHING, petitioners, the Hold-Orders against petitioners for an indefinite length of time. By so doing it has arbitrarily excluded petitioners
vs. from the enjoyment of a fundamental — right the right to freedom of movement — to which they are
PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT, SECRETARY RAMON A. DIAZ and COMMISSIONER entitled. 9 mandamus lies.
MARY CONCEPCION BAUTISTA, respondents.

G.R. No. 176831               January 15, 2010

1. The validity of the Hold-Orders issued against petitioners on 13 February 1987 has already expired pursuant to the
Rules and Regulations of the PCGG, which specifically provide:
UY KIAO ENG, Petitioner,
SECTION 1. ...
vs.
(D) ... A "hold-order" shall be valid only for a maximum period of six months, unless for good reasons extended
NIXON LEE, Respondent.
by the Commission en banc. "
The PCGG has not extended the life-span of the Hold-Orders in question nor has it advanced "good reasons" for
doing so. The first paragraph of Section 3 of Rule 65 of the Rules of Court pertinently provides that—
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, or
2. The grounds f or the issuance of the Hold-Orders have become stale.
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

15
 rendered commanding the respondent, immediately or at some other time to be specified by the court, to do the There being a plain, speedy and adequate remedy in the ordinary course of law for the production of the subject will,
act required to be done to protect the rights of the petitioner, and to pay the damages sustained by the petitioner the remedy of mandamus cannot be availed of. Suffice it to state that respondent Lee lacks a cause of action in his
by reason of the wrongful acts of the respondent.13 petition. Thus, the Court grants the demurrer.

Mandamus is a command issuing from a court of law of competent jurisdiction, in the name of the state or the G.R. No. L-28971 January 28, 1983
sovereign, directed to some inferior court, tribunal, or board, or to some corporation or person requiring the
performance of a particular duty therein specified, which duty results from the official station of the party to whom ARLEO E. MAGTIBAY, appellant,
the writ is directed or from operation of law.14 This definition recognizes the public character of the remedy, and vs.
clearly excludes the idea that it may be resorted to for the purpose of enforcing the performance of duties in which Lt. Col. SANTIAGO GARCIA and Cadet Colonel MARCELO JAVIER, respondents.
the public has no interest.15 The writ is a proper recourse for citizens who seek to enforce a public right and to
compel the performance of a public duty, most especially when the public right involved is mandated by the
Constitution.16 As the quoted provision instructs, mandamus will lie if the tribunal, corporation, board, officer, or At any rate, appellant's prayer to compel Lt. Col. Garcia to include him in the roster of graduates of the ROTC
person unlawfully neglects the performance of an act which the law enjoins as a duty resulting from an office, trust Advance Course is absolutely bereft of any legal basis to stand on. He was not allowed to graduate because he
or station.17 flunked the subject MS-42, a required subject for the completion of the ROTC Advance Course. That he flunked said
subject is not disputed by the appellant. True, an institution of learning has a contractual obligation to afford its
students a fair opportunity to complete the course they seek to pursue. However, when a student commits a serious
The writ of mandamus, however, will not issue to compel an official to do anything which is not his duty to do or breach of discipline or fails to maintain the required academic standard, he forfeits his contractual right; and the
which it is his duty not to do, or to give to the applicant anything to which he is not entitled by law. 18 Nor will court should not review the discretion of university authorities. 4
mandamus issue to enforce a right which is in substantial dispute or as to which a substantial doubt exists, although
objection raising a mere technical question will be disregarded if the right is clear and the case is meritorious. 19 As a
rule, mandamus will not lie in the absence of any of the following grounds: [a] that the court, officer, board, or This Court has consistently adhered to the rule that a writ of mandamus will not issue to control or review the
person against whom the action is taken unlawfully neglected the performance of an act which the law specifically exercise of discretion of a public officer where the law imposes upon said public officer the right and duty to exercise
enjoins as a duty resulting from office, trust, or station; or [b] that such court, officer, board, or person has judgment in reference to any matter in which he is required to act. It is his judgment that is to be exercised and not
unlawfully excluded petitioner/relator from the use and enjoyment of a right or office to which he is entitled.20 On the that of the court. 5
part of the relator, it is essential to the issuance of a writ of mandamus that he should have a clear legal right to the
thing demanded and it must be the imperative duty of respondent to perform the act required.21 G.R. No. 157783 September 23, 2005

Recognized further in this jurisdiction is the principle that mandamus cannot be used to enforce contractual NILO PALOMA, Petitioners,
obligations.22 Generally, mandamus will not lie to enforce purely private contract rights, and will not lie against an vs.
individual unless some obligation in the nature of a public or quasi-public duty is imposed. 23 The writ is not DANILO MORA, HILARIO FESTEJO, MAXIMA SALVINO, BRYN BONGBONG and VALENTINO
appropriate to enforce a private right against an individual. 24 The writ of mandamus lies to enforce the execution of SEVILLA, Respondent.
an act, when, otherwise, justice would be obstructed; and, regularly, issues only in cases relating to the public and to
the government; hence, it is called a prerogative writ.25  To preserve its prerogative character, mandamus is not used
Section 3, Rule 65 of the Rules of Court provides-
for the redress of private wrongs, but only in matters relating to the public.26 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, or
Moreover, an important principle followed in the issuance of the writ is that there should be no plain, speedy and unlawfully excludes another from the use and enjoyment of a right or office to which such other is entitled, and
adequate remedy in the ordinary course of law other than the remedy of mandamus being invoked.27 In other words, there is no other plain, speedy and adequate remedy in the ordinary course of law, the person aggrieved thereby
mandamus can be issued only in cases where the usual modes of procedure and forms of remedy are powerless to may file a verified petition in the proper court, alleging the facts with certainty and praying that judgment be
afford relief.28 Although classified as a legal remedy, mandamus is equitable in its nature and its issuance is generally rendered commanding the respondent, immediately or at some other time to be specified by the court, to do the
controlled by equitable principles.29 Indeed, the grant of the writ of mandamus lies in the sound discretion of the act required to be done to protect the rights of the petitioner and to pay the damages sustained by the petitioner
court. by reason of the wrongful acts of the respondent.

In the instant case, the Court, without unnecessarily ascertaining whether the obligation involved here—the Mandamus lies to compel the performance, when refused, of a ministerial duty, but not to compel the performance of
production of the original holographic will—is in the nature of a public or a private duty, rules that the remedy of a discretionary duty.23 Mandamus will not issue to control or review the exercise of discretion of a public officer where
mandamus cannot be availed of by respondent Lee because there lies another plain, speedy and adequate remedy in the law imposes upon said public officer the right and duty to exercise his judgment in reference to any matter in
the ordinary course of law. Let it be noted that respondent has a photocopy of the will and that he seeks the which he is required to act. It is his judgment that is to be exercised and not that of the court.24
production of the original for purposes of probate. The Rules of Court, however, does not prevent him from instituting
probate proceedings for the allowance of the will whether the same is in his possession or not. Rule 76, Section 1 Mandamus does not lie to compel the Board of Directors of the Palompon, Leyte Water District to reinstate petitioner
relevantly provides:
because the Board has the discretionary power to remove him under Section 23 of P.D. No. 198, as amended by P.D.
No. 768.

16
In fine, the appointment of petitioner and his consequent termination are clearly within the wide arena of discretion Similarly, the petitioner has not shown that he filed the present petition with this Court within the sixty-day
which the legislature has bestowed the appointing power, which in this case is the Board of Directors of the reglementary period35 from notice of the assailed Ombudsman’s resolutions. He did not do so, of course, since he
Palompon, Leyte Water District. Here, considering that the petitioner is at loggerheads with the Board, the former’s initially and erroneously filed a certiorari petition with the Sandiganbayan. We remind the petitioner that the remedy
services obviously ceased to be "pleasurable" to the latter. The Board of Directors of a Water District may abridge the from the Ombudsman’s orders or resolutions in criminal cases is to file a petition for certiorari under Rule 6536 with
term of the General Manager thereof the moment the latter’s services cease to be convivial to the former. Put this Court.37
another way, he is at the mercy of the appointing powers since his appointment can be terminated at any time
for any cause and following Orcullo there is no need of prior notice or due hearing before the incumbent can be The petition likewise fails even on the merits.
separated from office. Hence, petitioner is treading on shaky grounds with his intransigent posture that he was
removed sans cause and due process.
II. The respondents’ exclusion in the informations is grounded on the Ombudsman’s grant of immunity

Yes, as a general rule, no officer or employee of the civil service shall be removed or suspended except for cause
provided by law as provided in Section 2(3), Article IX-B of the 1987 Constitution. As exception to this, P.D. No. Mandamus is the proper remedy to compel the performance of a ministerial duty imposed by law upon the
198, which we held in Feliciano v. Commission On Audit  28 to be the special enabling charter of Local Water Districts, respondent.38 In matters involving the exercise of judgment and discretion, mandamus may only be resorted to, to
categorically provides that the General Manager shall serve "at the pleasure of the board." compel the respondent to take action; it cannot be used to direct the manner or the particular way discretion is to be
exercised.39

Neither is it the Court’s business to intrude into the Congressional sphere on the matter of the wisdom of Section 23
of P.D. No. 198. One of the firmly entrenched principles in constitutional law is that the courts do not involve In the exercise of his investigatory and prosecutorial powers, the Ombudsman is generally no different from an
themselves with nor delve into the policy or wisdom of a statute. That is the exclusive concern of the legislative ordinary prosecutor in determining who must be charged.40 He also enjoys the same latitude of discretion in
branch of the government. When the validity of a statute is challenged on constitutional grounds, the sole function of determining what constitutes sufficient evidence to support a finding of probable cause (that must be established for
the court is to determine whether it transcends constitutional limitations or the limits of legislative power. No such the filing of an information in court) 41 and the degree of participation of those involved or the lack thereof. His
transgression has been shown in this case.30 findings and conclusions on these matters are not ordinarily subject to review by the courts except when he gravely
abuses his discretion,42 i.e., when his action amounts to an evasion of a positive duty or a virtual refusal to perform a
duty enjoined by law, or when he acts outside the contemplation of law.43
Underlying the rulings of the trial and appellate courts in the case at bar is the doctrine of primary
jurisdiction; i.e., courts cannot and will not resolve a controversy involving a question which is within the jurisdiction
of an administrative tribunal, especially where the question demands the exercise of sound administrative discretion If, on the basis of the same evidence, the Ombudsman arbitrarily excludes from an indictment some individuals while
requiring the special knowledge, experience and services of the administrative tribunal to determine technical and impleading all others, the remedy of mandamus lies 44 since he is duty-bound, as a rule, to include in the information
intricate matters of fact. all persons who appear responsible for the offense involved.45

G.R. No. 169042               October 5, 2011 An immunity statute does not, and cannot, rule out a review by this Court of the Ombudsman’s exercise of
discretion. Like all other officials under our constitutional scheme of government, all their acts must adhere to the
Constitution.74 The parameters of our review, however, are narrow. In the first place, what we review are executive
ERDITO QUARTO, Petitioner,
acts of a constitutionally independent Ombudsman. 75 Also, we undertake the review given the underlying reality that
vs.
this Court is not a trier of facts. Since the determination of the requirements under Section 17, Rule 119 of the Rules
THE HONORABLE OMBUDSMAN SIMEON MARCELO, CHIEF SPECIAL PROSECUTOR DENNIS VILLA
of Court is highly factual in nature, the Court must, thus, generally defer to the judgment of the Ombudsman who is
IGNACIO, LUISITO M. TABLAN, RAUL B. BORILLO, and LUIS A. GAYYA, Respondents.
in a better position (than the Sandiganbayan or the defense) to know the relative strength and/or weakness of the
evidence presently in his possession and the kind, tenor and source of testimony he needs to enable him to prove his
We dismiss the petition on two grounds: first, the petitioner did not avail of the remedies available to him before case.76 It should not be forgotten, too, that the grant of immunity effectively but conditionally results in the
filing this present petition; and, second, within the context of the Court’s policy of non-interference with the extinction of the criminal liability the accused-witnesses might have incurred, as defined in the terms of the
Ombudsman’s exercise of his investigatory and prosecutory powers, the petitioner failed to establish that the grant of grant.77 This point is no less important as the grant directly affects the individual and enforces his right against self-
immunity to the respondents was attended by grave abuse of discretion. incrimination. These dynamics should constantly remind us that we must tread softly, but not any less critically, in
our review of the Ombudsman’s grant of immunity.
I. The petitioner did not exhaust remedies available in the ordinary course of law
From the point of view of the Court’s own operations, we are circumscribed by the nature of the review powers
As extraordinary writs, both Sections 1 (certiorari) and 3 (mandamus), Rule 65 of the Rules of Court require, as a granted to us under the Constitution and the Rules of Court. We rule on the basis of a petition for certiorari under
pre-condition for these remedies, that there be no other plain, speedy and adequate remedy in the ordinary course of Rule 65 and address mainly the Ombudsman’s exercise of discretion. Our room for intervention only occurs when a
law. In the present case, the petitioner has not shown that he moved for a reconsideration of the assailed resolutions clear and grave abuse of the exercise of discretion is shown. Necessarily, this limitation similarly reflects on the
based substantially on the same grounds stated in this present petition.32 Neither did the petitioner file a motion for petitioner who comes to us on the allegation of grave abuse of discretion; the petitioner himself is bound to clearly
the inclusion of the respondents in the informations before filing the present petition.33 These are adequate remedies and convincingly establish that the Ombudsman gravely abused his discretion in granting immunity in order to fully
that the petitioner chose to forego; he bypassed these remedies and proceeded to seek recourse through the present establish his case.78
petition.34

17
G.R. No. 211140 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
LORD ALLAN JAY Q. VELASCO, Petitioner, of Marinduque.
vs.
HON. SPEAKER FELICIANO R. BELMONTE, JR., SECRETARY GENERAL MARILYN 1 B. BARUA-YAP AND Note must also be made that as early as May 16, 2013, a couple of days before she was proclaimed, Reyes had
REGINA ONGSIAKO REYES, Respondents. 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.
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. 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:
A petition for quo warranto  is a proceeding to determine the right of a person to the use or exercise of a franchise or First. At the time of Reyes's proclamation, her COC was already cancelled by the COMELEC En Banc  in its final
office and to oust the holder from its enjoyment, if his claim is not well-founded, or if he has forfeited his right to finding in its resolution dated May 14, 2013, the effectivity of which was not enjoined by this Court, as Reyes did
enjoy the privilege. Where the action is filed by a private person, he must prove that he is entitled to the not avail of the prescribed remedy which is to seek a restraining order within a period of five (5) days as required
controverted position; otherwise, respondent has a right to the undisturbed possession of the office.42 In this case, by Section 13(b), Rule 18 of COMELEC Rules. Since no restraining order was forthcoming, the PBOC should have
given the present factual milieu, i.e., (i)  the final and executory resolutions of this Court in G.R. No. 207264; (ii)  the refrained from proclaiming Reyes.
final and executory resolutions of the COMELEC in SPA No. 13-053 (DC) cancelling Reyes's Certificate of Candidacy; Second. This Court upheld the COMELEC decision cancelling respondent Reyes's COC in its Resolutions of June 25,
and (iii)  the final and executory resolution of the COMELEC in SPC No. 13-010 declaring null and void the 2013 and October 22, 2013 and these Resolutions are already final and executory.
proclamation of Reyes and proclaiming Velasco as the winning candidate for the position of Representative for the Third. As a consequence of the above events, the COMELEC in SPC No. 13-010 cancelled respondent Reyes's
Lone District of the Province of Marinduque - it cannot be claimed that the present petition is one for the proclamation and, in turn, proclaimed Velasco as the duly elected Member of the House of Representatives in
determination of the right of Velasco to the claimed office. 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
To be sure, what is prayed for herein is merely the enforcement of clear legal duties and not to try disputed title. had NO valid COC NOR a valid proclamation.
That the respondents make it appear so will not convert this petition to one for quo warranto. 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.
Section 3, Rule 65 of the Rules of Court, as amended, provides that any person may file a verified petition Fifth. In view of the foregoing, Reyes HAS ABSOLUTELY NO LEGAL BASIS to serve as a Member of the House of
for mandamus  "when any tribunal, corporation, board, officer or person unlawfully neglects the performance of an Representatives for the Lone District of the Province of Marinduque, and therefore, she HAS NO LEGAL
act which the law specifically enjoins as a duty resulting from an office, trust, or station, or unlawfully excludes PERSONALITY to be recognized as a party-respondent at a quo warranto  proceeding before the HRET.
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 present Petition for Mandamus  seeks the issuance of a writ of mandamus  to compel respondents Speaker
the subject thereof is a ministerial  act or duty, and not purely discretionary  on the part of the board, officer or Belmonte, Jr. and Sec. Gen. Barua-Yap to acknowledge and recognize the final and executory Decisions and
person, and that the petitioner has a well-defined, clear and certain right to warrant the grant thereof.43 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
The difference between a ministerial and discretionary act has long been established. A purely ministerial act or duty whether or not the prayed for acts, i.e.,  (i) the administration of the oath of office to Velasco; and (ii)  the inclusion
is one which an officer or tribunal performs in a given state of facts, in a prescribed manner, in obedience to the of his name in the Roll of Members, are ministerial in character vis-a-vis  the factual and legal milieu of this case. As
mandate of a legal authority, without regard to or the exercise of his own judgment upon the propriety or we have previously stated, the administration of oath and the registration of Velasco in the Roll of Members of the
impropriety of the act done. If the law imposes a duty upon a public officer and gives him the right to decide how or House of Representatives for the Lone District of the Province of Marinduque are no longer a matter of discretion
when the duty shall be performed, such duty is discretionary and not ministerial. The duty is ministerial only when or judgment on the part of Speaker Belmonte, Jr. and Sec. Gen. Barua-Yap. They are legally duty-bound to
the discharge of the same requires neither the exercise of official discretion or judgment.44 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
As the facts stand in this case, Speaker Belmonte, Jr. and Sec. Gen. Barua-Y ap have no discretion whether or not to executory.
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 Under Rule 65, Section 3 of the 1997 Rules of Civil Procedure, any person may file a verified petition
in G.R. No. 207264 affirming the final and executory resolutions of the COMELEC in SPA No. 13-053 (DC) cancelling for mandamus  "when any tribunal, corporation, board, officer or person unlawfully neglects the performance of an
Reyes's Certificate of Candidacy. There is likewise a final and executory resolution of the COMELEC in SPC No. 13-010 act which the law specifically enjoins as a duty resulting from an office, trust, or station, or unlawfully excludes
declaring null and void the proclamation of Reyes, and proclaiming Velasco as the winning candidate for the position another from the use and enjoyment of a right or office to which such other is entitled, and there is no other plain,
of Representative for the Lone District of the Province of Marinduque. 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.

18
 The distinction between a ministerial and discretionary act is well delineated. A purely ministerial act or duty is one JESUS ARMANDO A.R. TARROSA, petitioner,
which an officer or tribunal performs in a given state of facts, in a prescribed manner, in obedience to the mandate vs.
of a legal authority, without regard to or the exercise of his own judgment upon the propriety or impropriety of the GABRIEL C. SINGSON and HON. SALVADOR M. ENRIQUEZ III, respondents
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 The instant petition is in the nature of a quo warranto proceeding as it seeks the ouster of respondent Singson and
of the same requires neither the exercise of official discretion or judgment. alleges that the latter is unlawfully holding or exercising the powers of Governor of the Bangko Sentral (Cf. Castro v.
Del Rosario, 19 SCRA 196 [1967]). Such a special civil action can only be commenced by the Solicitor General or by
G.R. No. 103702 December 6, 1994 a "person claiming to be entitled to a public office or position unlawfully held or exercised by another" (Revised Rules
of Court, Rule 66, Sec. 6; Acosta v. Flor, 5 Phil. 18 [1905]).
MUNICIPALITY OF SAN NARCISO, QUEZON; MAYOR JUAN K. UY; COUNCILORS: DEOGRACIAS R.
ARGOSINO III, BENITO T. CAPIO, EMMANUEL R. CORTEZ, NORMANDO MONTILLA, LEONARDO C. UY, In Sevilla v. Court of Appeals, 209 SCRA 637 (1992), we held that the petitioner therein, who did not aver that he
FIDEL C. AURELLANA, PEDRO C. CARABIT, LEONARDO D. AURELLANA, FABIAN M. MEDENILLA, TRINIDAD was entitled to the office of the City Engineer of Cabanatuan City, could not bring the action for quo warranto to oust
F. CORTEZ, SALVADOR M. MEDENILLA, CERELITO B. AUREADA and FRANCISCA A. BAMBA, petitioners, the respondent from said office as a mere usurper.
vs.
HON. ANTONIO V. MENDEZ, SR., Presiding Judge, Regional Trial Court, Branch 62, 4th Judicial Region, Likewise in Greene v. Knox, 175 N.Y. 432 (1903), 67 N.E. 910, it was held that the question of title to an office,
Gumaca, Quezon; MUNICIPALITY OF SAN ANDRES, QUEZON; MAYOR FRANCISCO DE LEON; COUNCILORS: which must be resolved in a quo warranto proceeding, may not be determined in a suit to restrain the payment of
FE LUPINAC, TOMAS AVERIA, MANUEL O. OSAS, WILFREDO O. FONTANIL, ENRICO U. NADRES, RODELITO salary to the person holding such office, brought by someone who does not claim to be the one entitled to occupy the
LUZOIR, LENAC, JOSE L. CARABOT, DOMING AUSA, VIDAL BANQUELES and CORAZON M. said office.
MAXIMO, respondents.

G.R. No. L-14803             June 30, 1961

The special civil action of quo warranto  is a "prerogative writ by which the Government can call upon any person to
show by what warrant he holds a public office or exercises a public franchise." 13 When the inquiry is focused on the
legal existence of a body politic, the action is reserved to the State in a proceeding for quo warranto  or any other FLAVIANO LOTA, petitioner,
credit proceeding. 14 It must be brought "in the name of the Republic of the Philippines" 15 and commenced by the vs.
Solicitor General or the fiscal "when directed by the President of the Philippines . . . ." 16 Such officers may, under THE COURT OF APPEALS, and MOISES SANGALANG, respondents.
certain circumstances, bring such an action "at the request and upon the relation of another person" with the
permission of the court. 17 The Rules of Court also allows an individual to commence an action for quo warranto  in his It is contended by the petitioner that the respondent Court erred in holding that the present action is one of quo
own name but this initiative can be done when he claims to be "entitled to a public office or position usurped or warranto; in not dismissing the action for failure of the plaintiff to join therein the Municipality of Taal, Batangas, as
unlawfully held or exercised by another." 18 While the quo warranto  proceedings filed below by petitioner municipality party defendant, and in declaring that respondent Moises Sangalang is entitled to hold, and continue in the office of
has so named only the officials of the Municipality of San Andres as respondents, it is virtually, however, a caretaker of the municipal cemetery of that municipality. It is argued that, as the Court of Appeals found that
denunciation of the authority of the Municipality or Municipal District of San Andres to exist and to act in that respondent Moises Sangalang was the duly appointed caretaker of the municipal cemetery of Taal, Batangas and he
capacity. was "unlawfully ousted from office", the remedy available to said respondent is mandamus, not quo warranto.

Petitioners' theory might perhaps be a point to consider had the case been seasonably brought. Executive Order No. We do not find merits in appellant's contentions. The claim that the instant action is one of mandamus, not quo
353 creating the municipal district of San Andres was issued on 20 August 1959 but it was only after almost thirty warranto, is devoid of basis. While quo warranto and mandamus are often concurrent remedies, however, there
(30) years, or on 05 June 1989, that the municipality of San Narciso finally decided to challenge the legality of the exists a clear distinction between the two. The authorities are agreed that quo warranto is the remedy to try the right
executive order. In the meantime, the Municipal District, and later the Municipality, of San Andres, began and to an office or franchise and to oust the holder from its enjoyment, while mandamus only lies to enforce clear legal
continued to exercise the powers and authority of a duly created local government unit. In the same manner that the duties, not to try disputed titles, 38 C.J. 546; 2 Moran, Comments on the Rules of Court, 1957 ed., 200; that where
failure of a public officer to question his ouster or the right of another to hold a position within a one-year period can here is usurpation or intrusion into an office, quo warranto is the proper remedy, Lino Luna vs. Rodriguez, 36 Phil.
abrogate an action belatedly filed, 19 so also, if not indeed with greatest imperativeness, must a quo 491, and that where the respondent, without claiming any right to an Office, excludes the petitioner therefrom, he
warranto  proceeding assailing the lawful authority of a political subdivision be timely raised. 20 Public interest remedy is mandamus, not quo warranto. Manalo vs. Sevilla, 24 Phil. 609; Lino Luna vs. Rodriguez, supra.
demands it.
As we analyze the facts in the light of the above rules, he instant action is clearly one of quo warranto,
Granting the Executive Order No. 353 was a complete nullity for being the result of an unconstitutional delegation of although mandamus is also invoked therein as an ancillary remedy. the facts, as found by the Court of Appeals, show
legislative power, the peculiar circumstances obtaining in this case hardly could offer a choice other than to consider that respondent Moises Sangalang "was holding the position of cemetery caretaker from 1951 until he was extended
the Municipality of San Andres to have at least attained a status uniquely of its own closely approximating, if not in a new appointment on July 1, 1955 by Dr. Noche"; that until then he had not resigned nor intended to abandon the
fact attaining, that of a de facto  municipal corporation. office"; that on February 13, 1956, the petitioner, Flaviano M. Lota appointed defendant Jose Sangalang as cemetery
caretaker of Taal to take Moises Sangalang's place and that Jose Sangalang claims to be the duly appointed
G.R. No. 111243 May 25, 1994 caretaker of said municipal cemetery. It also appears that Moises Sangalang alleges in his complaint that he had the
right to the possession and enjoyment of said office to which he had legally been appointed, and asks hat Jose

19
Sangalang, who is occupying it unlawfully, be ousted. The present action, therefore, is one whose purpose is to try 5.2. The Commission’s jurisdiction over all cases enumerated under Section 5 of Presidential Decree No. 902-A is
the right or title to a public office and oust he alleged unlawful holder from its enjoyment. Such proceeding and hereby transferred to the Courts of general jurisdiction or the appropriate Regional Trial Court: Provided, That the
remedy could only be litigated in a quo warranto action according to the authorities. Supreme Court in the exercise of its authority may designate the Regional Trial Court branches that shall exercise
jurisdiction over these cases. xxx
We also find no merit in the claim that the action should have been dismissed by the respondent Court for failure of
the plaintiff to implead the municipality of Taal. According to the jurisprudence, any person claiming to be entitled to Therefore, actions of quo warranto against persons who usurp an office in a corporation, which were formerly
a public office may bring an action of quo warranto, without the intervention of the Solicitor-General or the cognizable by the Securities and Exchange Commission under PD 902-A, have been transferred to the courts of
Fiscal, Navarro vs. Gimenez, 10 Phil. 226; Lino Luna vs. Rodriguez, supra; and that only the person who is in general jurisdiction. But, this does not change the fact that Rule 66 of the 1997 Rules of Civil Procedure does not
unlawful possession of the office, and all who claim to be entitled to that office, may be made parties in order to apply to quo warranto cases against persons who usurp an office in a private corporation. Presently, Section 1(a) of
determine their respective rights thereto in the same action. 2 Moran, Comments on the Rules of Court, 1957 ed., Rule 66 reads thus:
209, 210. The municipality of Taal does not claim that it wanted and had the right to occupy and enjoy the office of Section 1. Action by Government against individuals. – An action for the usurpation of a public office, position or
caretaker of its own municipal cemetery its pretension, as voiced by its mayor, is that Jose Sangalang is the party franchise may be commenced by a verified petition brought in the name of the Republic of the Philippines against
who had the right to occupy said office. It is not necessary for that municipality to appropriate funds for the payment (a) A person who usurps, intrudes into, or unlawfully holds or exercises a public office, position or franchise;
of Moises Sangalang's salary and salary differentials; there already existed funds appropriated for the purpose, and
what remained to be done was for the municipal treasurer to disburse them in accordance with law. The municipality As explained in the Unilongo12 case, Section 1(a) of Rule 66 of the present Rules no longer contains the phrase "or an
of Taal, therefore, is not an essential, nor even a necessary party, to this action. 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
G.R. No. 168696             February 28, 2006 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
MA. LUTGARDA P. CALLEJA, JOAQUIN M. CALLEJA, JR., JADELSON PETER P. CALLEJA, MA. JESSICA T. Under R.A. No. 8799 (hereinafter the Interim Rules) which applies to the petition for quo warranto filed by
FLORES, MERCIE C. TIPONES and PERFECTO NIXON C. TABORA, Petitioners, respondents before the trial court since what is being questioned is the authority of herein petitioners to assume the
vs. office and act as the board of directors and officers of St. John Hospital, Incorporated.
JOSE PIERRE A. PANDAY, AUGUSTO R. PANDAY and MA. THELNA P. MALLARI, Respondents.
The Interim Rules provide thus:
The Court notes that, indeed, petitioners chose the wrong remedy to assail the Order of July 13, 2005. It is hornbook Section 1. (a) Cases covered. – These Rules shall govern the procedure to be observed in civil cases involving the
principle that Rule 45 of the 1997 Rules of Civil Procedure governs appeals from judgments or final orders. 4 The following:
Order dated July 13, 2005 is basically a denial of herein petitioners’ prayer in their Answer for the dismissal of xxxx
respondents’ case against them. As a consequence of the trial court’s refusal to dismiss the case, it then directed the (2) Controversies arising out of intra-corporate, partnership, or association relations, between and
transfer of the case to another branch of the Regional Trial Court that had been designated as a special court to hear among stockholders, members, or associates, and between, any or all of them and the corporation,
cases formerly cognizable by the SEC. Verily, the order was merely interlocutory as it does not dispose of the case partnership, or association of which they are stockholders, members, or associates, respectively;
completely, but leaves something more to be done on its merits. Such being the case, the assailed Order cannot (3) Controversies in the election or appointment of directors, trustees, officers, or managers of
ordinarily be reviewed through a petition under Rule 45. 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
While a petition for review on certiorari under Rule 45 would ordinarily be inappropriate to assail an interlocutory
has jurisdiction over the principal office of the corporation, partnership, or association concerned. xxx (Emphasis
order, in the interest, however, of arresting the perpetuation of an apparent error committed below that could only
ours)
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.
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
It should be noted that allegations in a complaint for quo warranto that certain persons usurped the offices, powers
Trial Court that has jurisdiction over the principal office of the corporation. It is undisputed that the principal office of
and functions of duly elected members of the board, trustees and/or officers make out a case for an intra-corporate
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-
controversy.9 Prior to the enactment of R.A. No. 8799, the Court, adopting Justice Jose Y. Feria’s view, declared
SC, it is the Regional Trial Court designated as Special Commercial Courts in Camarines Sur which shall have
in Unilongo v. Court of Appeals 10 that Section 1, Rule 66 of the 1997 Rules of Civil Procedure is "limited to actions
jurisdiction over the petition for quo warranto filed by herein Respondents.
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
warranto against corporations, or against persons who usurp an office in a corporation, fall under the jurisdiction of Evidently, the RTC-Br. 58 in San Jose, Camarines Sur is bereft of jurisdiction over respondents’ petition for quo
the Securities and Exchange Commission and are governed by its rules. (P.D. No. 902-A as amended)."11 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
However, R.A. No. 8799 was passed and Section 5.2 thereof provides as follows:
over cases previously cognizable by the SEC.

20
G.R. No. 114795 July 17, 1996 PEDRO MENDOZA, petitioner,
vs.
LUCITA Q. GARCES, petitioner, RAY ALLAS and GODOFREDO OLORES, respondents.
vs.
THE HONORABLE COURT OF APPEALS, SALVADOR EMPEYNADO and CLAUDIO CONCEPCION, respondents. 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
The above organic provision did not require any cause for removal of an appointive official under the 1973 exercise some franchise or privilege appertaining to the state which, according to the Constitution and laws of the
Constitution. 16 The transition period from the old to the new Constitution envisioned an "automatic" land, they cannot legally exercise except by virtue of a grant or authority from the state. 9 In other words, a petition
vacancy; 17 hence the government is not hard put to prove anything plainly and simply because the Constitution for quo warranto  is a proceeding to determine the right of a person to the use or exercise of a franchise or office and
allows it. 18 Mere appointment and qualification of the successor removes an incumbent from his post. to oust the holder from its enjoyment, if his claim is not well-founded, or if he has forfeited his right to enjoy the
Nevertheless, the government in an act of auto-limitation and to prevent indiscriminate dismissal of government privilege. 10 The action may be commenced for the Government by the Solicitor General or the fiscal 11 against
personnel issued on May 28, 1986, Executive Order (E.O.) No. 17. This executive order, which applies in this case individuals who usurp a public office, against a public officer whose acts constitute a ground for the forfeiture of his
as it was passed prior to the issuance of Concepcion's transfer order, enumerates five grounds for separation or office, and against an association which acts as a corporation without being legally incorporated. 12 The action may
replacement of elective and appointive officials authorized under Article III, Section 2 of the Provisional also be instituted by an individual in his own name who claims to be entitled to the public office or position usurped
Constitution, to wit: or unlawfully held or exercised by another. 13
1. Existence of a case for summary dismissal pursuant to Section 40 of the Civil Service Law;
2. Existence of the probable cause for violation of the Anti-Graft and Corrupt Practices Act as determined by the Where the action is filed by a private person, he must prove that he is entitled to the controverted position,
Ministry Head concerned; otherwise respondent has a right to the undisturbed possession of the office. 14 If the court finds for the respondent,
3. Gross incompetence or inefficiency in the discharge of functions; the judgment should simply state that the respondent is entitled to the office. 15 If, however, the court finds for the
4. Misuse of public office for partisan political purposes; petitioner and declares the respondent guilty of usurping, intruding into, or unlawfully holding or exercising the
5. Any other analogous ground showing that the incumbent is unfit to remain in the service or his office, judgment may be rendered as follows:
separation/replacement is in the interest of the service. 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
Not one of these grounds was alleged to exist, much less proven by petitioner when respondent Concepcion was such defendant be ousted and altogether excluded therefrom, and that the plaintiff or relator, as the case may be,
transferred from Gutalac to Liloy. More, Concepcion was transferred without his consent. A transfer requires a prior recover his costs. Such further judgment may be rendered determining the respective rights in and to the office,
appointment. 19 If the transfer was made without the consent of the official concerned, it is tantamount to removal position, right, privilege, or franchise of all the parties to the action as justice requires.
without valid cause 20 contrary to the fundamental guarantee on non-removal except for cause. 21 Concepcion's
transfer thus becomes legally infirm and without effect for he was not validly terminated. His appointment to the If it is found that the respondent or defendant is usurping or intruding into the office, or unlawfully holding the same,
Liloy post, in fact, was incomplete because he did not accept it. Acceptance, it must be emphasized, it is the court may order:
indispensable to complete an appointment.22 Corollarily, Concepcion's post in Gutalac never became vacant. It is a (1) The ouster and exclusion of the defendant from office;
basic precept in the law of public officers that "no person, no matter how qualified and eligible he is for a certain (2) The recovery of costs by plaintiff or relator;
position may be appointed to an office which is not vacant. 23 There can be no appointment to a non-vacant (3) The determination of the respective rights in and to the office, position, right, privilege or franchise of all the
position. The incumbent must first be legally removed, or his appointment validly terminated before one could be parties to the action as justice requires. 16
validly installed to succeed him. Further, Garces' appointment was ordered to be deferred by the COMELEC. The
deferment order, we note, was not unequivocably lifted. Worse, her appointment to Gutalac was even cancelled by The character of the judgment to be rendered in quo warranto rests to some extent in the discretion of the court and
the COMELEC en banc. on the relief sought. 

These factors negate Garces' claim for a well-defined, clear, certain legal right to the Gutalac post. On the contrary, The trial court found that respondent Allas usurped the position of "Director III, Chief of the Customs Intelligence and
her right to the said office is manifestly doubtful and highly questionable. As correctly ruled by respondent Investigation Service." Consequently, the court ordered that respondent Allas be ousted from the contested position
court, mandamus, which petitioner filed below, will not lie as this remedy applies only where petitioner's right is and that petitioner be reinstated in his stead. The decision of the trial court had long become final and executory,
founded clearly in law and not when it is doubtful. 24 It will not issue to give him something to which he is not and petitioner prays for its execution. He alleges that he should have been reinstated despite respondent Olores'
clearly and conclusively entitled. 25 Considering that Concepcion continuously occupies the disputed position and appointment because the subject position was never vacant to begin with. Petitioner's removal was illegal and he was
exercises the corresponding functions therefor, the proper remedy should have been quo warranto and deemed never to have vacated his office when respondent Allas was appointed to the same. Respondent Allas'
not mandamus. 26 Quo warranto  tests the title to one's office claimed by another and has as its object the ouster of appointment was null and void and this nullity allegedly extends to respondent Olores, his successor-in-interest. 20
the holder from its enjoyment, while mandamus avails to enforce clear legal duties and not to try disputed titles. 27

Ordinarily, a judgment against a public officer in regard to a public right binds his successor in office. This rule,
G.R. No. 131977 February 4, 1999 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

21
office to which he lays claim. 22 In the case at bar, the petition for quo warranto  was filed by petitioner solely against G.R. No. 166429 December 19, 2005
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 REPUBLIC OF THE PHILIPPINES, Represented by Executive Secretary Eduardo R. Ermita, the
denying execution of the trial court's decision. DEPARTMENT OF TRANSPORTATION AND COMMUNICATIONS (DOTC), and the MANILA INTERNATIONAL
AIRPORT AUTHORITY (MIAA), Petitioners,
G.R. Nos. 179431-32               June 22, 2010 vs.
HON. HENRICK F. GINGOYON, In his capacity as Presiding Judge of the Regional Trial Court, Branch 117,
LUIS K. LOKIN, JR., as the second nominee of CITIZENS BATTLE AGAINST CORRUPTION Pasay City and PHILIPPINE INTERNATIONAL AIR TERMINALS CO., INC., Respondents.
(CIBAC), Petitioner,
vs. There are at least two crucial differences between the respective procedures under Rep. Act No. 8974 and Rule 67.
COMMISSION ON ELECTIONS and the HOUSE OF REPRESENTATIVES, Respondents. 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
The COMELEC posits that once the proclamation of the winning party-list organization has been done and its nominee initial deposit with an authorized government depositary. Moreover, Rule 67 prescribes that the initial deposit be
has assumed office, any question relating to the election, returns and qualifications of the candidates to the House of equivalent to the assessed value of the property for purposes of taxation, unlike Rep. Act No. 8974 which provides,
Representatives falls under the jurisdiction of the HRET pursuant to Section 17, Article VI of the 1987 Constitution. as the relevant standard for initial compensation, the market value of the property as stated in the tax declaration or
Thus, Lokin should raise the question he poses herein either in an election protest or in a special civil action for  quo the current relevant zonal valuation of the Bureau of Internal Revenue (BIR), whichever is higher, and the value of
warranto  in the HRET,  not in a special civil action for certiorari in this Court. the improvements and/or structures using the replacement cost method.

We do not agree. 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
An election protest proposes to oust the winning candidate from office. It is strictly a contest between the defeated RTC characterized as that which the Government "specifically made available for the purpose of this expropriation;"
and the winning candidates, based on the grounds of electoral frauds and irregularities, to determine who between and such amount to be deducted from the amount of just compensation due PIATCO as eventually determined by the
them has actually obtained the majority of the legal votes cast and is entitled to hold the office. It can only be filed RTC. Second, the Government was directed to submit to the RTC a Certificate of Availability of Funds signed by
by a candidate who has duly filed a certificate of candidacy and has been voted for in the preceding elections. 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
A special civil action for quo warranto refers to questions of disloyalty to the State, or of ineligibility of the winning operation" of the airport terminal, pending expropriation proceedings and full payment of just compensation.
candidate. The objective of the action is to unseat the ineligible person from the office, but not to install the However, the Government was prohibited "from performing acts of ownership like awarding concessions or leasing
petitioner in his place. Any voter may initiate the action, which is, strictly speaking, not a contest where the parties any part of [NAIA 3] to other parties."19
strive for supremacy because the petitioner will not be seated even if the respondent may be unseated.
The very next day after the issuance of the assailed 4 January 2005 Order, the Government filed an Urgent Motion
The controversy involving Lokin is neither an election protest nor an action for quo warranto,  for it concerns a very for Reconsideration, which was set for hearing on 10 January 2005. On 7 January 2005, the RTC issued
peculiar situation in which Lokin is seeking to be seated as the second nominee of CIBAC. Although an election another Order, the second now assailed before this Court, which appointed three (3) Commissioners to ascertain the
protest may properly be available to one party-list organization seeking to unseat another party-list organization to amount of just compensation for the NAIA 3 Complex. That same day, the Government filed a Motion for Inhibition of
determine which between the defeated and the winning party-list organizations actually obtained the majority of the Hon. Gingoyon.
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 This pronouncement contains the fundamental premises which permeate this decision of the Court. Indeed, Agan,
the case does not involve the ineligibility and disloyalty of Cruz-Gonzales to the Republic of the Philippines, or some final and executory as it is, stands as governing law in this case, and any disposition of the present petition must
other cause of disqualification for her. conform to the conditions laid down by the Court in its 2004 Resolution.

Lokin has correctly brought this special civil action for certiorari against the COMELEC to seek the review of the The 2004 Resolution Which Is Law of This Case Generally Permits Expropriation
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 The pronouncement in the 2004 Resolution is especially significant to this case in two aspects, namely:
resolutions of the COMELEC and the Commission on Audit. As Rule 64 states, the mode of review is by a petition for (i) that PIATCO must receive payment of just compensation determined in accordance with law and
certiorari in accordance with Rule 65 to be filed in the Supreme Court within a limited period of 30 days. equity; and (ii) that the government is barred from taking over NAIA 3 until such just compensation is
Undoubtedly, the Court has original and exclusive jurisdiction over Lokin’s petitions for certiorari and for mandamus paid. The parties cannot be allowed to evade the directives laid down by this Court through any mode of judicial
against the COMELEC. action, such as the complaint for eminent domain.

22
The Government has chosen to resort to expropriation, a remedy available under the law, which has the added expropriation may be accomplished, there is no need under Rule 67 or Rep. Act No. 8974 for legislative authorization
benefit of an integrated process for the determination of just compensation and the payment thereof to PIATCO. We before the Government may proceed with a particular exercise of eminent domain. The most crucial difference
appreciate that the case at bar is a highly unusual case, whereby the Government seeks to expropriate a building between Rule 67 and Rep. Act No. 8974 concerns the particular essential step the Government has to undertake to
complex constructed on land which the State already owns. be entitled to a writ of possession.

However, the reason for the resort by the Government to expropriation proceedings is understandable in this case. The first paragraph of Section 2 of Rule 67 provides:
The 2004 Resolution, in requiring the payment of just compensation prior to the takeover by the Government of SEC. 2. Entry of plaintiff upon depositing value with authorized government depository. — Upon the filing of the
NAIA 3, effectively precluded it from acquiring possession or ownership of the NAIA 3 through the unilateral exercise complaint or at any time thereafter and after due notice to the defendant, the plaintiff shall have the right to take
of its rights as the owner of the ground on which the facilities stood. or enter upon the possession of the real property involved if he deposits with the authorized government
depositary an amount equivalent to the assessed value of the property for purposes of taxation to be
The right of eminent domain extends to personal and real property, and the NAIA 3 structures, adhered as they are held by such bank subject to the orders of the court. Such deposit shall be in money, unless in lieu
to the soil, are considered as real property.26 The public purpose for the expropriation is also beyond dispute. It thereof the court authorizes the deposit of a certificate of deposit of a government bank of the Republic
should also be noted that Section 1 of Rule 67 (on Expropriation) recognizes the possibility that the property sought of the Philippines payable on demand to the authorized government depositary.
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 In contrast, Section 4 of Rep. Act No. 8974 relevantly states:
complaint did aver that the NAIA 3 complex "stands on a parcel of land owned by the Bases Conversion Development SEC. 4. Guidelines for Expropriation Proceedings.— Whenever it is necessary to acquire real property for the right-
Authority, another agency of [the Republic of the Philippines]."27 of-way, site or location for any national government infrastructure project through expropriation, the appropriate
proceedings before the proper court under the following guidelines:
Admittedly, eminent domain is not the sole judicial recourse by which the Government may have acquired the NAIA 3 a) Upon the filing of the complaint, and after due notice to the defendant, the implementing agency shall
facilities while satisfying the requisites in the 2004 Resolution. Eminent domain though may be the most effective, as immediately pay the owner of the property the amount equivalent to the sum of (1) one hundred percent (100%)
well as the speediest means by which such goals may be accomplished. Not only does it enable immediate of the value of the property based on the current relevant zonal valuation of the Bureau of Internal Revenue
possession after satisfaction of the requisites under the law, it also has a built-in procedure through which just (BIR); and (2) the value of the improvements and/or structures as determined under Section 7 hereof;
compensation may be ascertained. Thus, there should be no question as to the propriety of eminent domain c) In case the completion of a government infrastructure project is of utmost urgency and importance, and there
proceedings in this case. is no existing valuation of the area concerned, the implementing agency shall immediately pay the owner of the
property its proffered value taking into consideration the standards prescribed in Section 5 hereof.

It is from these premises that we resolve the first question, whether Rule 67 of the Rules of Court or Rep. Act No.
8974 governs the expropriation proceedings in this case. As can be gleaned from the above-quoted texts, Rule 67 merely requires the Government to deposit with an
authorized government depositary the assessed value of the property for expropriation for it to be entitled to a writ
of possession. On the other hand, Rep. Act No. 8974 requires that the Government make a direct payment to the
Application of Rule 67 Violates the 2004 Agan Resolution property owner before the writ may issue. Moreover, such payment is based on the zonal valuation of the BIR in the
case of land, the value of the improvements or structures under the replacement cost method, 29 or if no such
The Government insists that Rule 67 of the Rules of Court governs the expropriation proceedings in this case to the valuation is available and in cases of utmost urgency, the proffered value of the property to be seized.
exclusion of all other laws. On the other hand, PIATCO claims that it is Rep. Act No. 8974 which does apply. Earlier,
we had adverted to the basic differences between the statute and the procedural rule. Further elaboration is in order. It is quite apparent why the Government would prefer to apply Rule 67 in lieu of Rep. Act No. 8974. Under Rule 67, it
would not be obliged to immediately pay any amount to PIATCO before it can obtain the writ of possession since all it
Rule 67 outlines the procedure under which eminent domain may be exercised by the Government. Yet by no means need do is deposit the amount equivalent to the assessed value with an authorized government depositary. Hence, it
does it serve at present as the solitary guideline through which the State may expropriate private property. For devotes considerable effort to point out that Rep. Act No. 8974 does not apply in this case, notwithstanding the
example, Section 19 of the Local Government Code governs as to the exercise by local government units of the undeniable reality that NAIA 3 is a national government project. Yet, these efforts fail, especially considering the
power of eminent domain through an enabling ordinance. And then there is Rep. Act No. 8974, which covers controlling effect of the 2004 Resolution in Agan on the adjudication of this case.
expropriation proceedings intended for national government infrastructure projects.
It is the finding of this Court that the staging of expropriation proceedings in this case with the exclusive use of Rule
Rep. Act No. 8974, which provides for a procedure eminently more favorable to the property owner than Rule 67, 67 would allow for the Government to take over the NAIA 3 facilities in a fashion that directly rebukes our 2004
inescapably applies in instances when the national government expropriates property "for national government Resolution in Agan. This Court cannot sanction deviation from its own final and executory orders.
infrastructure projects."28 Thus, if expropriation is engaged in by the national government for purposes other than
national infrastructure projects, the assessed value standard and the deposit mode prescribed in Rule 67 continues to Section 2 of Rule 67 provides that the State "shall have the right to take or enter upon the possession of the real
apply. property involved if [the plaintiff] deposits with the authorized government depositary 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
Under both Rule 67 and Rep. Act No. 8974, the Government commences expropriation proceedings through the filing court."30 It is thus apparent that under the provision, all the Government need do to obtain a writ of possession is to
of a complaint. Unlike in the case of local governments which necessitate an authorizing ordinance before deposit the amount equivalent to the assessed value with an authorized government depositary.

23
Would the deposit under Section 2 of Rule 67 satisfy the requirement laid down in the 2004 Resolution that "[f]or the some degree of payment to the private property owner before a writ of possession may issue. The utilization of Rep.
government to take over the said facility, it has to compensate respondent PIATCO as builder of the said structures"? Act No. 8974 guarantees compliance with this bare minimum requirement, as it assures the private property owner
Evidently not. the payment of, at the very least, the proffered 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
If Section 2 of Rule 67 were to apply, PIATCO would be enjoined from receiving a single centavo as just schematic under Rep. Act No. 8974, one which facially complies with the prescription laid down in the 2004
compensation before the Government takes over the NAIA 3 facility by virtue of a writ of possession. Such an Resolution.
injunction squarely contradicts the letter and intent of the 2004 Resolution. Thus, at the very least, Rule 67 cannot
apply in this case without violating the 2004 Resolution. The Proper Amount to be Paid under Rep. Act No. 8974

Rep. Act No. 8974 Fits to the Situation at Bar and Complements the 2004 Agan Resolution It must be clarified that PIATCO cannot be reimbursed or justly compensated for the value of the parcel of land on
which NAIA 3 stands. PIATCO is not the owner of the land on which the NAIA 3 facility is constructed, and it should
Rep. Act No. 8974 is entitled "An Act To Facilitate The Acquisition Of Right-Of-Way, Site Or Location For National not be entitled to just compensation that is inclusive of the value of the land itself. It would be highly disingenuous to
Government Infrastructure Projects And For Other Purposes." Obviously, the law is intended to cover expropriation compensate PIATCO for the value of land it does not own. Its entitlement to just compensation should be limited to
proceedings intended for national government infrastructure projects. Section 2 of Rep. Act No. 8974 explains what the value of the improvements and/or structures themselves. Thus, the determination of just compensation cannot
are considered as "national government projects." include the BIR zonal valuation under Section 4 of Rep. Act No. 8974.

Sec. 2. National Government Projects. – The term "national government projects" shall refer to all national Under Rep. Act No. 8974, the Government is required to "immediately pay" the owner of the property the amount
government infrastructure, engineering works and service contracts, including projects undertaken by government- equivalent to the sum of (1) one hundred percent (100%) of the value of the property based on the current relevant
owned and controlled corporations, all projects covered by Republic Act No. 6957, as amended by Republic Act No. zonal valuation of the [BIR]; and (2) the value of the improvements and/or structures as determined under Section
7718, otherwise known as the Build-Operate-and-Transfer Law, and other related and necessary activities, such as 7. As stated above, the BIR zonal valuation cannot apply in this case, thus the amount subject to immediate payment
site acquisition, supply and/or installation of equipment and materials, implementation, construction, completion, should be limited to "the value of the improvements and/or structures as determined under Section 7," with Section
operation, maintenance, improvement, repair and rehabilitation, regardless of the source of funding. 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."42 However, the replacement cost is only one of the factors to
As acknowledged in the 2003 Decision, the development of NAIA 3 was made pursuant to a build-operate-and- be considered in determining the just compensation.
transfer arrangement pursuant to Republic Act No. 6957, as amended, 33 which pertains to infrastructure or
development projects normally financed by the public sector but which are now wholly or partly implemented by the
private sector.34 Under the build-operate-and-transfer scheme, it is the project proponent which undertakes the Admittedly, there is no way, at least for the present, to immediately ascertain the value of the improvements and
construction, including the financing, of a given infrastructure facility. 35 In Tatad v. Garcia,36 the Court acknowledged structures since such valuation is a matter for factual determination. 43 Yet Rep. Act No. 8974 permits an expedited
that the operator of the EDSA Light Rail Transit project under a BOT scheme was the owner of the facilities such as means by which the Government can immediately take possession of the property without having to await precise
"the rail tracks, rolling stocks like the coaches, rail stations, terminals and the power plant."37 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,
There can be no doubt that PIATCO has ownership rights over the facilities which it had financed and constructed. taking into consideration the standards prescribed in Section 5 [of the law]." 44 The "proffered value" may strike as a
The 2004 Resolution squarely recognized that right when it mandated the payment of just compensation to PIATCO highly subjective standard based solely on the intuition of the government, but Rep. Act No. 8974 does provide
prior to the takeover by the Government of NAIA 3. The fact that the Government resorted to eminent domain relevant standards by which "proffered value" should be based,45 as well as the certainty of judicial determination of
proceedings in the first place is a concession on its part of PIATCO’s ownership. Indeed, if no such right is recognized, the propriety of the proffered value.46
then there should be no impediment for the Government to seize control of NAIA 3 through ordinary ejectment
proceedings.
In filing the complaint for expropriation, the Government alleged to have deposited the amount of ₱3 Billion
earmarked for expropriation, representing the assessed value of the property. The making of the deposit, including
There is no doubt that the NAIA 3 is not, under any sensible contemplation, a "right-of-way." Yet we cannot agree the determination of the amount of the deposit, was undertaken under the erroneous notion that Rule 67, and not
with the Government’s insistence that neither could NAIA 3 be a "site" or "location". Indeed, we cannot accept the Rep. Act No. 8974, is the applicable law. Still, as regards the amount, the Court sees no impediment to recognize this
Government’s proposition that the only properties that may be expropriated under Rep. Act No. 8974 are parcels of sum of ₱3 Billion as the proffered value under Section 4(b) of Rep. Act No. 8974. After all, in the initial determination
land. Rep. Act No. 8974 contemplates within its coverage such real property constituting land, buildings, roads and of the proffered value, the Government is not strictly required to adhere to any predetermined standards, although
constructions of all kinds adhered to the soil. its proffered value may later be subjected to judicial review using the standards enumerated under Section 5 of Rep.
Act No. 8974.
Even as the provisions of Rep. Act No. 8974 call for that law’s application in this case, the threshold test must still be
met whether its implementation would conform to the dictates of the Court in the 2004 Resolution. Unlike in the case While the Court agrees that ₱3 Billion should be considered as the correct proffered value, still we cannot deem the
of Rule 67, the application of Rep. Act No. 8974 will not contravene the 2004 Resolution, which requires the payment Government as having faithfully complied with Rep. Act No. 8974. For the law plainly requires direct payment to the
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

24
property owner, and not a mere deposit with the authorized government depositary. Without such direct payment, no appointment of commissioners under Rule 67 may be resorted to, even in expropriation proceedings under Rep. Act
writ of possession may be obtained. No. 8974, since the application of the provisions of Rule 67 in that regard do not conflict with the statute.

Clearly, without full payment of just compensation, there can be no transfer of title from the landowner to the But while the appointment of commissioners under the aegis of Rule 67 may be sanctioned in expropriation
expropriator. Otherwise stated, the Republic’s acquisition of ownership is conditioned upon the full payment of just proceedings under Rep. Act No. 8974, the standards to be observed for the determination of just compensation are
compensation within a reasonable time. provided not in Rule 67 but in the statute.

Significantly, in  Municipality of Biñan v. Garcia[62 ]  this Court ruled that the expropriation of lands consists of two Nothing in Rule 67 or Rep. Act No. 8974 requires that the RTC consult with the parties in the expropriation case on
stages, to wit: who should be appointed as commissioners. Neither does the Court feel that such a requirement should be imposed
"x x x The first is concerned with the determination of the authority of the plaintiff to exercise the power of in this case.
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 What Rule 67 does allow though is for the parties to protest the appointment of any of these commissioners, as
property sought to be condemned, for the public use or purpose described in the complaint, upon the payment of provided under Section 5 of the Rule. These objections though must be made filed within ten (10) days from service
just compensation to be determined as of the date of the filing of the complaint" x x x. of the order of appointment of the commissioners.

The second phase of the eminent domain action is concerned with the determination by the court of "the just G.R. No. G.R. No. 150936             August 18, 2004
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.
NATIONAL POWER CORPORATION, petitioner,
vs.
Final Determination of Just Compensation Within 60 Days MANUBAY AGRO-INDUSTRIAL DEVELOPMENT CORPORATION, respondents.

The issuance of the writ of possession does not write finis  to the expropriation proceedings. As earlier pointed out, Sole Issue: Just Compensation
expropriation is not completed until payment to the property owner of just compensation. The proffered value stands
as merely a provisional determination of the amount of just compensation, the payment of which is sufficient to
transfer possession of the property to the Government. However, to effectuate the transfer of ownership, it is Petitioner contends that the valuation of the expropriated property -- fixed by the trial court and affirmed by the CA
necessary for the Government to pay the property owner the final just compensation. -- was too high a price for the acquisition of an easement of a mere aerial right of way, because respondent would
continue to own and use the subject land anyway. Petitioner argues that in a strict sense, there is no "taking" of
property, but merely an imposition of an encumbrance or a personal easement/servitude under Article 614 10 of the
In Lim the Government deliberately refused to pay just compensation. The Court went on to rule that "in cases where Civil Code. Such encumbrance will not result in ousting or depriving respondent of the beneficial enjoyment of the
the government failed to pay just compensation within five (5) years from the finality of the judgment in the property. And even if there was a "taking," petitioner points out that the loss is limited only to a portion of the aerial
expropriation proceedings, the owners concerned shall have the right to recover possession of their property."65 domain above the property of respondent. Hence, the latter should be compensated only for what it would actually
lose.
Rep. Act No. 8974 mandates a speedy method by which the final determination of just compensation may be had.
Section 4 provides: We are not persuaded.
In the event that the owner of the property contests the implementing agency’s proffered value, the court shall
determine the just compensation to be paid the owner within sixty (60) days from the date of filing of the
expropriation case. When the decision of the court becomes final and executory, the implementing agency shall pay Petitioner averred in its Complaint in Civil Case No. RTC 96-3675 that it had sought to acquire an easement of a right
the owner the difference between the amount already paid and the just compensation as determined by the court. of way over portions of respondent’s land -- a total area of 22,961.71 square meters.11 In its prayer, however, it also
sought authority to enter the property and demolish all improvements existing thereon, in order to commence and
undertake the construction of its Power Transmission Project.
Appointment of Commissioners

In other words, the expropriation was not to be limited to an easement of a right of way. In its Answer, respondent
The next argument for consideration is the claim of the Government that the RTC erred in appointing the three alleged that it had already authorized petitioner to take possession of the affected portions of the property and to
commissioners in its 7 January 2005 Order  without prior consultation with either the Government or PIATCO, or install electric towers thereon.12 The latter did not controvert this material allegation.
without affording the Government the opportunity to object to the appointment of these commissioners. We can
dispose of this argument without complication.
True, an easement of a right of way transmits no rights except the easement itself, and respondent retains full
ownership of the property. The acquisition of such easement is, nevertheless, not gratis. As correctly observed by the
It must be noted that Rep. Act No. 8974 is silent on the appointment of commissioners tasked with the CA, considering the nature and the effect of the installation power lines, the limitations on the use of the land for an
ascertainment of just compensation.67 This protocol though is sanctioned under Rule 67. We rule that the indefinite period would deprive respondent of normal use of the property. For this reason, the latter is entitled to
payment of a just compensation, which must be neither more nor less than the monetary equivalent of the land.16

25
Just compensation is defined as the full and fair equivalent of the property taken from its owner by the expropriator. facts, or it may set aside the report and appoint new commissioners, or it may accept the report in part and reject it
The measure is not the taker’s gain, but the owner’s loss. The word "just" is used to intensify the meaning of the in part; x x x." In other words, the reports of commissioners are merely advisory and recommendatory in character,
word "compensation" and to convey thereby the idea that the equivalent to be rendered for the property to be taken as far as the courts are concerned.28
shall be real, substantial, full and ample.17
Thus, it hardly matters whether the commissioners have unanimously agreed on their recommended valuation of the
In eminent domain or expropriation proceedings, the just compensation to which the owner of a condemned property property. It has been held that the report of only two commissioners may suffice, even if the third commissioner
is entitled is generally the market value. Market value is "that sum of money which a person desirous but not dissents.29 As a court is not bound by commissioners’ reports it may make such order or render such judgment as
compelled to buy, and an owner willing but not compelled to sell, would agree on as a price to be given and received shall secure for the plaintiff the property essential to the exercise of the latter’s right of condemnation; and for the
therefor."18 Such amount is not limited to the assessed value of the property or to the schedule of market values defendant, just compensation for the property expropriated. For that matter, the court may even substitute its own
determined by the provincial or city appraisal committee. However, these values may serve as factors to be estimate of the value as gathered from the evidence on record.30
considered in the judicial valuation of the property.19
G.R. No. 146587               July 2, 2002
The parcels of land sought to be expropriated are undeniably undeveloped, raw agricultural land. But a dominant
portion thereof has been reclassified by the Sangguniang Panlungsod ng Naga -- per Zoning Ordinance No. 94-076 REPUBLIC OF THE PHILIPPINES, represented by the General Manager of the PHILIPPINE INFORMATION
dated August 10, 1994 -- as residential, per the August 8, 1996 certification of Zoning Administrator Juan O. Villegas AGENCY (PIA), petitioner,
Jr. vs.
THE HONORABLE COURT OF APPEALS and the HEIRS OF LUIS SANTOS as herein represented by DR.
The nature and character of the land at the time of its taking is the principal criterion for determining how much just SABINO SANTOS and PURIFICACION SANTOS IMPERIAL, respondents.
compensation should be given to the landowner.22 All the facts as to the condition of the property and its
surroundings, as well as its improvements and capabilities, should be considered.23 The right of eminent domain is usually understood to be an ultimate right of the sovereign power to appropriate any
property within its territorial sovereignty for a public purpose.7 Fundamental to the independent existence of a State,
In fixing the valuation at P550 per square meter, the trial court had considered the Report of the commissioners and it requires no recognition by the Constitution, whose provisions are taken as being merely confirmatory of its
the proofs submitted by the parties. These documents included the following: (1) the established fact that the presence and as being regulatory, at most, in the due exercise of the power.
property of respondent was located along the Naga-Carolina provincial road; (2) the fact that it was about 500
meters from the Kayumanggi Resort and 8 kilometers from the Naga City Central Business District; and a half The ubiquitous character of eminent domain is manifest in the nature of the expropriation proceedings. Expropriation
kilometer from the main entrance of the fully developed Naga City Sports Complex -- used as the site of the Palarong proceedings are not adversarial in the conventional sense, for the condemning authority is not required to assert any
Pambansa -- and the San Francisco Village Subdivision, a first class subdivision where lots were priced at P2,500 per conflicting interest in the property. Thus, by filing the action, the condemnor in effect merely serves notice that it is
square meter; (3) the fair market value of P650 per square meter proffered by respondent, citing its recently taking title and possession of the property, and the defendant asserts title or interest in the property, not to prove a
concluded sale of a portion of the same property to Metro Naga Water District at a fixed price of P800 per square right to possession, but to prove a right to compensation for the taking.9
meter; (4) the BIR zonal valuation of residential lots in Barangay Pacol, Naga City, fixed at a price of P220 per
square meter as of 1997; and (5) the fact that the price of P430 per square meter had been determined by the RTC
of Naga City (Branch 21)24 as just compensation for the Mercados’ adjoining property, which had been expropriated Obviously, however, the power is not without its limits: first, the taking must be for public use, and second, that just
by NPC for the same power transmission project. compensation must be given to the private owner of the property. 10 These twin proscriptions have their origin in the
recognition of the necessity for achieving balance between the State interests, on the one hand, and private rights,
upon the other hand, by effectively restraining the former and affording protection to the latter.11 In determining
The chairperson of the Board of Commissioners, in adopting the recommendation of Commissioner Bulaos, made a "public use," two approaches are utilized - the first is public employment or the actual use by the public, and
careful study of the property. Factors considered in arriving at a reasonable estimate of just compensation for the second  is public advantage or benefit.
respondent were the location; the most profitable likely use of the remaining area; and the size, shape, accessibility
as well as listings of other properties within the vicinity. Averments pertaining to these factors were supported by
documentary evidence. The expropriated property has been shown to be for the continued utilization by the PIA, a significant portion thereof
being ceded for the expansion of the facilities of the Bulacan State University and for the propagation of the
Philippine carabao, themselves in line with the requirements of public purpose. Respondents question the public
On the other hand, the commissioner for petitioner -- City Assessor Albeus -- recommended a price of P115 per nature of the utilization by petitioner of the condemned property, pointing out that its present use differs from the
square meter in his Report dated June 30, 1997. No documentary evidence, however, was attached to substantiate purpose originally contemplated in the 1969 expropriation proceedings. The argument is of no moment. The property
the opinions of the banks and the realtors, indicated in the commissioner’s Report and computation of the market has assumed a public character upon its expropriation. Surely, petitioner, as the condemnor and as the owner of the
value of the property. property, is well within its rights to alter and decide the use of that property, the only limitation being that it be for
public use, which, decidedly, it is.
Majority Report of Commissioners Sufficient
In insisting on the return of the expropriated property, respondents would exhort on the pronouncement in Provincial
Under Section 8 of Rule 67 of the Rules of Court, the court may "accept the report and render judgment in Government of Sorsogon vs. Vda. de Villaroya 14 where the unpaid landowners were allowed the alternative remedy of
accordance therewith; or for cause shown, it may recommit the same to the commissioners for further report of recovery of the property there in question.

26
Petitioner has occupied, utilized and, for all intents and purposes, exercised dominion over the property pursuant to Corollarily, the respondent, which is the condemnor, has the burden of proving all the essentials necessary to show
the judgment. The exercise of such rights vested to it as the condemnee indeed has amounted to at least a partial the right of condemnation.46 It has the burden of proof to establish that it has complied with all the requirements
compliance or satisfaction of the 1979 judgment, thereby preempting any claim of bar by prescription on grounds of provided by law for the valid exercise of the power of eminent domain.
non-execution. In arguing for the return of their property on the basis of non-payment, respondents ignore the fact
that the right of the expropriatory authority is far from that of an unpaid seller in ordinary sales, to which the remedy The Court declared that the following requisites for the valid exercise of the power of eminent domain by a local
of rescission might perhaps apply. An in rem  proceeding, condemnation acts upon the property.21 After government unit must be complied with:
condemnation, the paramount title is in the public under a new and independent title;22 thus, by giving notice to all 1. An ordinance is enacted by the local legislative council authorizing the local chief executive, in behalf of the local
claimants to a disputed title, condemnation proceedings provide a judicial process for securing better title against all government unit, to exercise the power of eminent domain or pursue expropriation proceedings over a particular
the world than may be obtained by voluntary conveyance.23 private property.
2. The power of eminent domain is exercised for public use, purpose or welfare, or for the benefit of the poor and
The constitutional limitation of "just compensation" is considered to be the sum equivalent to the market value of the the landless.
property, broadly described to be the price fixed by the seller in open market in the usual and ordinary course of 3. There is payment of just compensation, as required under Section 9, Article III of the Constitution, and other
legal action and competition or the fair value of the property as between one who receives, and one who desires to pertinent laws.
sell, it fixed at the time of the actual taking by the government. 25 Thus, if property is taken for public use before 4. A valid and definite offer has been previously made to the owner of the property sought to be expropriated, but
compensation is deposited with the court having jurisdiction over the case, the final compensation must include said offer was not accepted.47
interests on its just value to be computed from the time the property is taken to the time when compensation is
actually paid or deposited with the court.26 In fine, between the taking of the property and the actual payment, legal The respondent was burdened to prove the mandatory requirement of a valid and definite offer to the owner of the
interests accrue in order to place the owner in a position as good as (but not better than) the position he was in property before filing its complaint and the rejection thereof by the latter.48 It is incumbent upon the condemnor to
before the taking occurred.27 exhaust all reasonable efforts to obtain the land it desires by agreement. 49 Failure to prove compliance with the
mandatory requirement will result in the dismissal of the complaint.50
G.R. No. 152230. August 9, 2005
The purpose of the requirement of a valid and definite offer to be first made to the owner is to encourage settlements
JESUS IS LORD CHRISTIAN SCHOOL FOUNDATION, INC., Petitioners, and voluntary acquisition of property needed for public purposes in order to avoid the expense and delay of a court
vs. action. A reasonable offer in good faith, not merely perfunctory or pro forma offer, to acquire the property for a
MUNICIPALITY (now CITY) OF PASIG, METRO MANILA, Respondent. reasonable price must be made to the owner or his privy. 57 A single bona fide offer that is rejected by the owner will
suffice.
Eminent Domain: Nature and Scope
The expropriating authority is burdened to make known its definite and valid offer to all the owners of the property.
The right of eminent domain is usually understood to be an ultimate right of the sovereign power to appropriate any However, it has a right to rely on what appears in the certificate of title covering the land to be expropriated. Hence,
property within its territorial sovereignty for a public purpose. The nature and scope of such power has been it is required to make its offer only to the registered owners of the property.
comprehensively described as follows:
… It is an indispensable attribute of sovereignty; a power grounded in the primary duty of government to serve the In the present case, the respondent failed to prove that before it filed its complaint, it made a written definite and
common need and advance the general welfare. Thus, the right of eminent domain appertains to every valid offer to acquire the property for public use as an access road.
independent government without the necessity for constitutional recognition. The provisions found in modern
constitutions of civilized countries relating to the taking of property for the public use do not by implication grant It bears stressing, however, that the respondent offered the letter only to prove its desire or intent to acquire the
the power to the government, but limit the power which would, otherwise, be without limit. Thus, our own property for a right-of-way.60 The document was not offered to prove that the respondent made a definite and valid
Constitution provides that "[p]rivate property shall not be taken for public use without just compensation." offer to acquire the property.
Furthermore, the due process and equal protection clauses act as additional safeguards against the arbitrary
exercise of this governmental power.41
Public Necessity

Strict Construction and Burden of Proof

We reject the contention of the petitioner that its property can no longer be expropriated by the respondent because
it is intended for the construction of a place for religious worship and a school for its members. As aptly explained by
The exercise of the right of eminent domain, whether directly by the State or by its authorized agents, is necessarily this Court in Manosca v. Court of Appeals,65 thus:
in derogation of private rights.42 It is one of the harshest proceedings known to the law. Consequently, when the It has been explained as early as Seña v. Manila Railroad Co., that:
sovereign delegates the power to a political unit or agency, a strict construction will be given against the agency … A historical research discloses the meaning of the term "public use"  to be one of constant growth. As society
asserting the power. advances, its demands upon the individual increases and each demand is a new use to which the resources of the
individual may be devoted. … for "whatever is beneficially employed for the community is a public use."

27
 As long as the purpose of the taking is public, then the power of eminent domain comes into play. The procedure for determining just compensation is set forth in Rule 67 of the 1997 Rules of Civil Procedure.
Section 5 of Rule 67 partly states that ‘upon the rendition of the order of expropriation, the court shall appoint not
The subject property is expropriated for the purpose of constructing a road. The respondent is not mandated to more than three (3) competent and disinterested persons as commissioners to ascertain and report to the court the
comply with the essential requisites for an easement of right-of-way under the New Civil Code. Case law has it that in just compensation for the property sought to be taken.’ However, we held in Republic v. Court of Appealsthat Rule
the absence of legislative restriction, the grantee of the power of eminent domain may determine the location and 67 presupposes a prior filing of complaint for eminent domain with the appropriate court by the expropriator. If no
route of the land to be taken66 unless such determination is capricious and wantonly injurious.67 Expropriation is such complaint is filed, the expropriator is considered to have violated procedural requirements, and hence, waived
justified so long as it is for the public good and there is genuine necessity of public character. 68 Government may not the usual procedure prescribed in Rule 67, including the appointment of commissioners to ascertain just
capriciously choose what private property should be taken.69 compensation.

The respondent has demonstrated the necessity for constructing a road from E. R. Santos Street to Sto. Tomas Records show that sometime in 1990, NPC filed an expropriation case docketed as Civil Case No. IR-2243. However,
Bukid. The witnesses, who were residents of Sto. Tomas Bukid, testified that although there were other ways through in an Order dated July 12, 1994, the expropriation case was dismissed by the RTC for failure of NPC to prosecute.
which one can enter the vicinity, no vehicle, however, especially fire trucks, could enter the area except through the Subsequently, or on December 5, 1994, respondents filed Civil Case No. IR-2678 which is a complaint for
newly constructed Damayan Street. compensation and recovery of damages. Considering the dismissal of the expropriation case for failure of the NPC to
prosecute, it is as if no expropriation suit was filed. Hence, pursuant to the above-quoted ruling, NPC is deemed "to
have violated procedural requirements, and hence, waived the usual procedure prescribed in Rule 67, including the
Nonetheless, the respondent failed to show the necessity for constructing the road particularly in the petitioner’s appointment of commissioners to ascertain just compensation." Nevertheless, just compensation for the property
property and not elsewhere. must be based on its value at the timeof the taking of said property, not at the time of the filing ofthe complaint.

On this point, the trial court made the following findings: In this case, the RTC formed a panel of commissioners in determining the just compensation of the property.
… The contention of the defendants that there is an existing alley that can serve the purpose of the expropriator is Although this is not required considering our pronouncement in Republic v. Court of Appeals,19 nonetheless, its
not accurate. An inspection of the vicinity reveals that the alley being referred to by the defendants actually passes constitution is not improper.20 "The appointment was done mainly to aid the trial court in determining just
thru Bagong Taon St. but only about one-half (1/2) of its entire length is passable by vehicle and the other half is compensation, and it was not opposed by the parties. Besides, the trial court is not bound by the commissioner’s
merely a foot-path. It would be more inconvenient to widen the alley considering that its sides are occupied by recommended valuation of the subject property. The court has the discretion on whether to adopt the commissioners’
permanent structures and its length from the municipal road to the area sought to be served by the expropriation valuation or to substitute itsown estimate of the value as gathered from the records."21
is considerably longer than the proposed access road. The area to be served by the access road is composed of
compact wooden houses and literally a slum area. As a result of the expropriation of the 51-square meter portion
of the property of the intervenor, a 3-meter wide road open to the public is created. This portion of the property of Significantly, the values recommended by the commissioners were those values prevailing in 1994 and 1995, or
the intervenor is the most convenient access to the interior of Sto. Tomas Bukid since it is not only a short cut to during the time the complaint for compensation and damages was filed. Considering that these are not the relevant
the interior of the Sto. Tomas Bukid but also an easy path for vehicles entering the area, not to mention the 3- values at the timeNPC took possession of the property in 1990, it was incumbent upon the RTC to have disregarded
meter wide road requirement of the Fire Code.72 the same. Unfortunately, it adopted these values. Onthis score alone, we find a need to remand this case to the RTC
for further proceedings.

However, as correctly pointed out by the petitioner, there is no showing in the record that an ocular inspection was
conducted during the trial. If, at all, the trial court conducted an ocular inspection of the subject property during the G.R. No. 165354               January 12, 2015
trial, the petitioner was not notified thereof. The petitioner was, therefore, deprived of its right to due process. It
bears stressing that an ocular inspection is part of the trial as evidence is thereby received and the parties are REPUBLIC OF THE PHILIPPINES, represented by the NATIONAL POWER CORPORATION,  Petitioner,
entitled to be present at any stage of the trial. vs.
HEIRS OF SATURNINO Q. BORBON, AND COURT OF APPEALS, Respondents.
G.R. No. 197329               September 8, 2014
The expropriator who has taken possession of the property subject of expropriation is obliged to pay reasonable
NATIONAL POWER CORPORATION, Petitioner, compensation to the landowner for the period of such possession although the proceedings had been discontinued on
vs. the ground that the public purpose for the expropriation had meanwhile ceased.
LUIS SAMAR and MAGDALENA SAMAR, Respondents.
The dismissal of the proceedings for expropriation at the instance of NAPOCOR is proper, but, conformably with
In Republic v. Court of Appeals,18 we held that: Section 4,36 Rule 67 of the Rules of Court, the dismissal or discontinuance of the proceedings must be upon such
Just compensation is based on the price or value of the property at the time it was taken from the owner and terms as the court deems just and equitable.
appropriated by the government. However, if the government takes possession before the institution of
expropriation proceedings, the value should befixed as of the time of the taking of said possession, not of the filing Before anything more, we remind the parties about the nature of the power of eminent domain. The right of eminent
of the complaint. The value at the time of the filing of the complaint should be the basis for the determination of domain is "the ultimate right of the sovereign power to appropriate, not only the public but the private property of all
the value when the taking of the property involved coincides with or is subsequent to the commencement of the citizens within the territorial sovereignty, to public purpose."37 But the exercise of such right is not unlimited, for two
proceedings. mandatory requirements should underlie the Government’s exercise of the power of eminent domain, namely: (1)

28
that it is for a particular public purpose; and (2) that just compensation be paid to the property owner. 38 These liable to the respondents for the disturbance of their property rights from the time of entry until the time of
requirements partake the nature of implied conditions that should be complied with to enable the condemnor to keep restoration of the possession of the property.
the property expropriated.39
There is a "taking" in this sense when the expropriator enters private property not only for a momentary period but
Public use, in common acceptation, means "use by the public." "Public use" has now been held to be synonymous for a more permanent duration, for the purpose of devoting the property to a public use in such a manner as to
with "public interest," "public benefit," and "public convenience." oust the owner and deprive him of all beneficial enjoyment thereof.

More particularly, with respect to the element of public use, the expropriator should commit to use the property In view of the discontinuance of the proceedings and the eventual return of the property to the respondents, there is
pursuant to the purpose stated in the petition for expropriation filed, failing which, it should file another petition for no need to pay "just compensation" to them because their property would not be taken by NAPOCOR. Instead of full
the new purpose. If not, it is then incumbent upon the expropriator to return the said property to its private owner, market value of the property, therefore, NAPOCOR should compensate the respondents for the disturbance of their
if the latter desires to reacquire the same. property rights from the time of entry in March 1993 until the time of restoration of the possession by paying to them
actual or other compensatory damages.
Indeed, public use is the fundamental basis for the action for expropriation; hence, NAPOCOR’s motion to discontinue
the proceedings is warranted and should be granted. The Court has observed in Metropolitan Water District v. De los This should mean that the compensation must be based on what they actually lost as a result and by reason of their
Angeles: dispossession of the property and of its use, including the value of the fruit trees, plants and crops destroyed by
It is not denied that the purpose of the plaintiff was to acquire the land in question for public use. The fundamental NAPOCOR’s construction of the transmission lines.
basis then of all actions brought for the expropriation of lands, under the power of eminent domain, is public use.
That being true, the very moment that it appears at any stage of the proceedings that the expropriation is not for a
public use, the action must necessarily fail and should be dismissed, for the reason that the action cannot be
maintained at all except when the expropriation is for some public use. That must be true even during the
pendency of the appeal or at any other stage of the proceedings. If, for example, during the trial in the lower court,
it should be made to appear to the satisfaction of the court that the expropriation is not for some public use, it
would be the duty and the obligation of the trial court to dismiss the action. And even during the pendency of the
appeal, if it should be made to appear to the satisfaction of the appellate court that the expropriation is not for
public use, then it would become the duty and the obligation of the appellate court to dismiss it.

In the present case the petitioner admits that the expropriation of the land in question is no longer necessary for
public use. Had that admission been made in the trial court the case should have been dismissed there. It now
appearing positively, by resolution of the plaintiff, that the expropriation is not necessary for public use, the action
GREGORIO Y. LIMPIN, and ROGELIO M. SARMIENTO, petitioners,
should be dismissed even without a motion on the part of the plaintiff. The moment it appears in whatever stage of
vs.
the proceedings that the expropriation is not for a public use the complaint should be dismissed and all the parties
INTERMEDIATE APPELLATE COURT and GUILLERMO PONCE, respondents.
thereto should be relieved from further annoyance or litigation.46 (underscoring and emphasis supplied)

Once again the parties are before this Court; this time, for a determination of whether or not the equity of
Here, NAPOCOR seeks to discontinue the expropriation proceedings on the ground that the transmission lines
redemption recognized in favor of petitioner Rogelio M. Sarmiento in this Court's judgment promulgated on January
constructed on the respondents’ property had already been retired. Considering that the Court has consistently
30, 1987, still subsists and may be exercised, more than a year after that judgment had become final and executory.
upheld the primordial importance of public use in expropriation proceedings, NAPOCOR’s reliance on Metropolitan
Water District v. De los Angeles was apt and correct. Verily, the retirement of the transmission lines necessarily
stripped the expropriation proceedings of the element of public use. To continue with the expropriation proceedings The proceedings concern two (2) lots, then covered by TCTs Nos. 92836 and 92837, which, together with two (2)
despite the definite cessation of the public purpose of the project would result in the rendition of an invalid judgment others, were originally mortgaged in 1973 to herein private respondent Ponce by their former owners, the Spouses
in favor of the expropriator due to the absence of the essential element of public use. Jose and Marcelina Aquino. These two lots were afterwards sold in 1978 by the same Aquino Spouses to Butuan Bay
Wood Export Corporation. Against this corporation herein petitioner Limpin obtained a money judgment in 1979; and
to satisfy the judgment, the two lots were levied on and sold at public auction in 1980, Limpin being the highest
Accordingly, the Court grants the motion to discontinue the proceedings subject to the conditions to be shortly
bidder. Limpin later sold the lots to his co-petitioner, Sarmiento.
mentioned hereunder, and requires the return of the property to the respondents. Having said that, we must point
out that NAPOCOR entered the property without the owners’ consent and without paying just compensation to the
respondents. Neither did it deposit any amount as required by law prior to its entry. Considering that in the process Earlier however or a day before levy was made on the two lots in execution of the judgment against Butuan Bay
of installing transmission lines, NAPOCOR destroyed some fruit trees and plants without payment, and the installation Wood Export Corporation. Ponce had initiated judicial proceedings for the foreclosure of the mortgage over said two
of the transmission lines went through the middle of the land as to divide the property into three lots, thereby (2) lots (together with the two (2) others mortgaged to him Judgment was rendered in his favor and became final;
effectively rendering the entire property inutile for any future use, it would be unfair for NAPOCOR not to be made and at the ensuing foreclosure sale, the lots were acquired by Ponce himself as highest bidder. Ponce then moved for
confirmation of the foreclosure sale, but the Court confirmed the sale of only two lots, refusing to do so as regards

29
the two which had been subject of the execution sale in Limpin's favor (i.e., those covered TCTs Nos. 92836 and opposition was promptly filed by Ponce under date of May 4, 1988 11 in which he argued that "Sarmiento's right to
92837). exercise his equity of redemption over those lots had long expired," the opportunity to exercise it having presented
itself but not availed of "(i) after ... default in the performance of the conditions of the mortgage and (ii) before the
It was to resolve the resulting dispute that Ponce instituted a special civil action in the Intermediate Appellate Court, Sheriffs sale of the property and the judicial confirmation thereof." According to Ponce, "from October 17, 1982, ...
impleading Limpin and Sarmiento a indispensable parties respondents. That Court rendered judgment on February (when) Sarmiento's predecessors-in-interest defaulted in their obligations over the mortgaged properties, up to June
28, 1985 in Ponce's favor; Limpin and Sarmiento appealed; this Court denied their appeal. 17, 1987, when this ... (Trial) Court confirmed the auction sale of those properties, Sarmiento could (and should)
have exercised his 'equity of redemption.'" Judge Solano did not share this view, and ruled accordingly. 12

The judgment of this Court of January 30, 1987 dismissed Sarmiento's and Limpin's petition for review on certiorari
of the Appellate Court's decision of February 28, 1985. It in effect affirmed the latter's decision which inter The issue has been brought to this Court for resolution by Ponce's "Motion for Clarification" dated May 27, 1988 and
alia ordered the Trial Court "to confirm the sale (of the lots formerly covered by TCT Nos. 92836 and 92837) and "Supplemental Motion ..." dated June 13, 1988, as to which Sarmiento has submitted a Comment dated June
issue a writ of possession to ... (Guillermo Ponce) with respect to the aforesaid lots, subject to the equity of 17,1988. To the comment a reply has been presented by Ponce under date of August 3, 1988.
redemption of the respondent Rogelio V. Sarmiento  1 Applying the doctrine laid down in Santiago v. Dionisio, a 1953
decision of this Court 2 the Intermediate Appellate Court's decision declared that "the sale to Ponce, as the highest Ponce states 13 that the term, equity of redemption, means "the right of the mortgagor to redeem the mortgaged
bidder in the foreclosure sale of the two lots in question should have been confirmed, subject to Limpin's (and now property after his default in the performance of the conditions of the mortgage but before the sale of the property or
Sarmiento's) equity of redemption." the judicial) confirmation of the (Sheriffs) sale," citing Top Rate International Services, Inc. v. IAC 142 SCRA 473
[1976], or "the right to redeem mortgaged property by paying the amount ordered by the court within a period of
This Court's aforesaid judgment also clearly and categorically sustained the exercise by the Appellate Court ninety days, or, even thereafter but before the confirmation of the sale, invoking Sun Life Assurance Co. of Canada
of jurisdiction over the persons of Rogelio M. Sarmiento and Gregorio Limpin. 3 There can thus be no question that v. Diez, 52 Phil. 275 [1928]. 14 On this premise, he postulates that "from October 17, 1982, the date Sarmiento's
the petitoners herein, said Rogelio Sarmiento and Gregorio Limpin, were affected and are bound by the decision of predecessors-in-interest defaulted in their obligations over the mortgaged properties, up to June 17, 1987, when the
the Intermediate Appellate Court, and that of this Court affirming it. lower court confirmed the auction sale of those properties, Sarmiento could have exercised his 'equity of
redemption."' Not having done so within that time, his equity of redemption had been extinguished; indeed, by
opting to file "new suits against Ponce ... seeking to annul Ponce's titles over those properties" instead of redeeming
Rogelio M. Sarmiento, particularly, was aware that the Trial Court had the ministerial duty to execute the Appellate the same, he had "waived his equity of redemption (assuming such right existed at the time the suits were
Court's decision, i.e., to confirm the sale and issue a writ of possession as regards the aforesaid lots, subject to the commenced)."
equity of redemption explicitly recognized in his favor in the decisions mentioned. He knew that he had
the prerogative to exercise his equity of redemption, if not from the moment that the judgment of this Court became
final and executory, 4 at least until the Court a quo, presided over by Hon. Antonio Solano, subsequently confirmed It is Sarmiento's position, on the other hand, 15 that the "17 June 1987 confirmation of the sale of the two lots could
the sale and issued a writ of possession in favor of Guillermo Ponce in June, 1987. 5 not have cut off ... (his) equity of redemption;" in fact, "Ponce himself, in his 'Urgent Motion' dated 1 June 1987,
precisely prayed for the issuance of a writ of possession 'subject to the equity of redemption of Rogelio M. Sarmiento'
thereby recognizing Sarmiento's equity of redemption beyond confirmation date," 16 He also argues that he had not
He did not try to exercise that right before, at or about the time of the confirmation of the foreclosure sale by Judge been informed of the time when his right of redemption would be cut-off, 17 because he "never received a copy of any
Solano. Instead, he instituted no less than two (2) actions in the same Regional Trial Court which were assigned to Motion for Confirmation, much less notice of hearing thereon in violation of his right to due process;" that to hold
another branch, presided over by Hon. Teodoro Beltran- attempting to relitigate precisely the same issues which this otherwise would "render nugatory the decision of the Court of Appeals and this ... Court on the issue;" and that he is
Court and the Intermediate Appellate Court had already passed upon and resolved adversely to him. For doing so for entitled to a reasonable time, e.g., a year, for the exercise of his equity of redemption. 18
trifling with and abusing the processes of the courts, and thus unwarrantedly delaying execution of the final and
executory judgment against him he and his counsel were both found guilty of contempt and correspondingly
punished by this Court, by Resolution dated May 5, 1988. The same resolution also decreed the dismissal of the The equity of redemption is, to be sure, different from and should not be confused with the right of redemption. 19
complaints in both cases and the nullification and setting aside of the restraining or injunctive orders of Judge
Beltran. The right of redemption in relation to a mortgage-understood in the sense of a prerogative to re-acquire mortgaged
property after registration of the foreclosure sale- exists only in the case of the extrajudicial foreclosure of the
It was not until March 11, 1988-nine months or so after entry of the judgment recognizing his equity of redemption mortgage. No such right is recognized in a judicial foreclosure except only where the mortgagee is the Philippine
as successor-in-interest of the original mortgagors that Sarmiento finally be stirred himself to attempt to exercise his National Bank or a bank or banking institution.
unforeclosed equity of redemption. On that day he filed a motion with the Court presided over by Hon. Judge Antonio
Solano, manifesting that he would exercise the right and asked the Court to fix the redemption price.  6 The Court Where a mortgage is foreclosed extra-judicially, Act 3135 grants to the mortgagor the right of redemption within one
opined that "this should be the subject of the agreement between Ponce and Sarmiento. 7 (1) year from the registration of the sheriffs certificate of foreclosure sale. 20

Sarmiento then wrote to Ponce on March 23, 1988 offering "P 2.6 million as redemption price for the two lots Where the foreclosure is judicially effected, however, no equivalent right of redemption exists. The law 21 declares
originally covered by TCTs Nos. 92836 and 92837, now 307100 and 307124. 8 Ponce's answer, dated March 25, that a judicial foreclosure sale, "when confirmed by an order of the court, ... shall operate to divest the rights of all
1988, rejected the offer said averred "that the period within which ... (Sarmiento) could have exercised such right ... the parties to the action and to vest their rights in the purchaser, subject to such rights of redemption as may be
(had) lapsed. 9 Sarmiento reacted by filing a motion with the Solano Court, dated March 29, 1988, asking it to "fix allowed by law. 22 Such rights exceptionally "allowed by law" (i.e., even after confirmation by an order of the court)
the redemption price ... and that the implementation of the writ of possession be provisionally deferred. 10 An are those granted by the charter of the Philippine National Bank (Acts No. 2747 and 2938), and the General Banking

30
Act (R.A. 337). 23 These laws confer on the mortgagor, his successors in interest or any judgment creditor of the Given the fact that said appealed orders of the Trial Court had been issued upon motion for confirmation earlier made
mortgagor, the right to redeem the property sold on foreclosure-after confirmation by the court of the foreclosure by Ponce-which was duly served and heard-the aforecited Decision of the Intermediate Appellate Court can be
sale-which right may be exercised within a period of one (1) year, counted from the date of registration of the construed in no wise than as a peremptory command to the Trial Court to confirm the sale as directed, motu proprio,
certificate of sale in the Registry of Property. and without the need of any further motion or other action on the part of Ponce. The rejection by this Court of
Sarmiento's and Limpin's appeal in its own Decision of January 30, 1987, which imported nothing less than a total
But, to repeat, no such right of redemption exists in case of judicial foreclosure of a mortgage if the mortgagee is not affirmance of the Decision of the Appellate Court, should therefore have sufficiently alerted Sarmiento that
the PNB or a bank or banking institution. In such a case, the foreclosure sale, "when confirmed by an order of the confirmation could come at any time after this Court's Decision became final, with or without any action from Ponce.
court. ... shall operate to divest the rights of all the parties to the action and to vest their rights in the purchaser." He cannot, in the circumstances, claim unfair surprise. He should, upon being notified of this Court's Decision, have
There then exists only what is known as the equity of redemption. This is simply the right of the defendant taken steps to redeem the properties in question or, at the very least, served the Trial Court and Ponce with notice of
mortgagor to extinguish the mortgage and retain ownership of the property by paying the secured debt within the his intention to exercise his equity of redemption. There was certainly time enough to do this the order confirming
90-day period after the judgment becomes final, in accordance with Rule 68, or even after the foreclosure sale but the foreclosure sale issuing only on June 17, 1987—had he not occupied himself with the fruitless maneuverings to
prior to its confirmation. Section 2, Rule 68 provides that— re-litigate the issues already recounted. Indeed, had he made an attempt to redeem, even belatedly but within a
... If upon the trial ... the court shag find the facts set forth in the complaint to be true, it shall ascertain the reasonable period of time after learning of the order of confirmation (the record shows he did learn of it within three
amount due to the plaintiff upon the mortgage debt or obligation, including interest and costs, and shall render [3) days after its issuance), 30 he might perhaps have given the Court some reason to consider his bid on equitable
judgment for the sum so found due and order the same to be paid into court within a period of not less than  ninety grounds. He did not. He let nine (9) months pass, to repeat, in carrying out improper (and contumacious stratagems
(90) days from the date of the service of such order, and that in default of such payment the property be sold to to negate the judgments against him, before making any such move.
realize the mortgage debt and Costs. 24
Neither can Sarmiento acceptably claim that Ponce, by moving for a writ of possession subject to his (Sarmiento's)
This is the mortgagor's equity (not right) of redemption which, as above stated, may be exercised by him even equity of redemption, recognized the existence and enforceability of that prerogative beyond the prescribed cut-off
beyond the 90-day period "from the date of service of the order,' and even after the foreclosure sale itself, provided date of confirmation of the sale. Such an interpretation of the motion is totally unwarranted, given the fact that said
it be before the order of confirmation of the sale. 25 After such order of confirmation, no redemption can be effected motion was made at a time (June 1, 1987) when there was as yet no order confirming the sale and, since
any longer. Sarmiento's equity of redemption then still unquestionably existed, there was hardly occasion or for that matter, any
reason as far as Ponce was concerned, to provide against its lapsing. Moreover, assuming for the sake of argument
that a resolutory period fixed by law may be extended by act of the party in whose favor its expiration would
It is this same equity of redemption that is conferred by law on the mortgagor's successors-in-interest, or third operate, that act must bespeak a clear and unequivocal intent to grant such an extension. No such clear grant can be
persons acquiring rights over the mortgaged property subsequent, and therefore subordinate, to the mortgagee's inferred from the terms of Ponce's motion, which can, and in fact should be, read as a mere affirmation that there
lien. 26 If these subsequent or junior lienholders be not joined in the foreclosure action, the judgment in the existed at the time an equity of redemption in Sarmiento's favor.
mortgagor's favor is ineffective as to them, of course. In that case, they retain what is known as the "unforeclosed
equity of redemption," and a separate foreclosure proceeding should be brought to require them to redeem from the
first mortgagee, or the party acquiring title to the mortgaged property at the foreclosure sale, within 90 WHEREFORE, the Court hereby rules that the equity of redemption claimed and invoked by Rogelio M. Sarmiento
days, 27 under penalty of losing that prerogative to redeem. In the case at bar, however, there is no occasion to over the properties originally covered by Transfer Certificates of Title Nos. 92836 and 92837 (now by TCTs Numbered
speak of any "unforeclosed equity of redemption' in Sarmiento's favor since he was properly impleaded in the judicial 307100 and 307124), Registry of Deeds of Quezon City, subject of this case, lapsed and ceased to exist without
proceeding where his and Ponce's rights over the mortgaged property were ventilated and specifically adjudicated. having been properly exercised, on June 17, 1987, with the issuance by the Trial Court of the Order confirming the
sheriffs sale (on judicial foreclosure) of said properties in favor of Guillermo Ponce.

Under the circumstances obtaining in this case, the plain intendment of the Intermediate Appellate Court was to give
to Sarmiento, not the unforeclosed equity of redemption pertaining to a stranger to the foreclosure suit, but the G.R. NO. 156542              June 26, 2007
same equity of redemption possessed by the mortgagor himself. The judgment cannot be construed as contemplating
or requiring the institution of a separate suit by Ponce to compel Sarmiento to exercise his unforeclosed equity of CANDELARIA Q. DAYOT, Petitioner,
redemption, or as granting Sarmiento the option to redeem at any time that he pleases, subject only to prescription. vs.
This would give rise to that multiplicity of proceedings which the law eschews. The judgment plainly intended that SHELL CHEMICAL COMPANY, (PHILS.), INC., Respondent.
Sarmiento exercise his option to redeem, as successor of the mortgagor.
Assailed in the Petition for Review on Certiorari before the Court is the July 30, 2002 Decision 1 of the Court of
Upon the facts on record, Sarmiento cannot be heard to complain of denial of due process for alleged lack of notice of Appeals (CA) in CA-G.R. SP. No. 70696 nullifying the January 8, 2002 Amended Order, 2 January 10, 2002 Alias Writ
any motion or hearing for confirmation of sale. The Decision of the Intermediate Appellate Court which he and his of Possession,3 January 10, 2002 Notice to Vacate 4 and April 12, 2002 Order,5 which were all issued by the Regional
predecessor, Limpin, had appealed to this Court specifically ordered the Trial Court to confirm 28 the judicial Trial Court (RTC) of Iloilo, Branch 29; and the CA December 23, 2002 Resolution 6 denying herein petitioner's Motion
foreclosure sale in favor of Ponce over the two lots, in these terms. 29 for Reconsideration.
WHEREFORE, the orders dated October 16,1983 and December 19,1983 of the respondent court, so far as they
deny the confirmation of the sale of the lots formerly covered by TCT Nos. 92836 and 92837, are SET ASIDE, and On April 20, 1982, Panay Railways, Inc. (PRI) executed a real estate mortgage contract over six parcels of land
the respondent court is hereby ORDERED to confirm the sale and issue a writ of possession to the petitioner with located in Lapuz District, Iloilo City in favor of Traders Royal Bank (TRB) for purposes of securing its loan obligations
respect to the aforesaid lots, subject to the equity of redemption of the respondent Rogelio V. Sarmiento. Without to TRB.7 The subject properties are denominated as follows: Lot No. 3834, covered by Transfer Certificate of Title
costs.

31
(TCT) No. T-45727; Lot No. 1-A, covered by TCT No. T-45728; and Lot Nos. 6153, 6156, 6158 and 6159, all Wherefore, let an Alias Writ of Possession issue on the affected portions of Lots 3834, 1-A and 6153, all situated in
covered by TCT No. T-58200. PRI failed to pay its loan. As a consequence, the mortgaged properties were foreclosed the City of Iloilo, with a total land area of 14,940 sq. meters occupied by Shell and 17,000 sq. meters occupied by
and sold at public auction to TRB as the highest bidder. PRI failed to redeem the foreclosed properties. Hence, TRB Petron and to place and install petitioner Candelaria Dayot in possession thereof.
consolidated its ownership over the subject parcels of land and, thereafter, certificates of title were issued in its Mr. Redentor Rodriguez, Sheriff IV of this Court is hereby directed to implement this order.
name, to wit: TCT No. T-84233, which canceled TCT No. T-45728; TCT No. T-84234, which canceled TCT No. T-
45727; and TCT Nos. T-84235, T-84236, T-84237 and T-84238, all of which canceled TCT No. T-58200. On January 10, 2002, the Branch Clerk of Court of RTC Iloilo, Branch 29, issued an Alias Writ of Possession.

Thereafter, TRB filed a Petition for Writ of Possession with the RTC of Iloilo City, docketed as LRC CAD. REC. NO. 1 On even date, the Sheriff served upon Shell a Notice to Vacate.
ILOILO CITY and LRC CAD. REC. NO. 9616 ILOILO CITY. 8 In its Order dated October 22, 1990, the trial court granted
the petition and ordered the issuance of a writ of possession in favor of TRB. 9 However, the writ was not fully
implemented. Thereafter, Shell and Petron moved for the reconsideration of the January 8, 2002 Order of the RTC but the trial
court denied it via its Order dated April 12, 2002.

On November 20, 1990, TRB sold to spouses Edmundo and Candelaria Dayot (Spouses Dayot), by virtue of a Deed of
Absolute Sale, five parcels of land which are portions of Lots 3834, 1-A and 6153. Shell then filed a petition for certiorari and prohibition with the CA praying for the nullification of the January 8, 2002
and April 12, 2002 Orders of RTC Iloilo, Branch 29, as well as the Alias Writ of Possession and Notice to Vacate both
dated January 10, 2002. The petition also sought to permanently enjoin the RTC from enforcing the assailed orders
Subsequently, on February 5, 1991, Candelaria Dayot (petitioner) filed a Supplemental Pleading before the RTC of and processes and from acting and conducting further proceedings in the subject case.
Iloilo City, praying that she, being the transferee of all the rights and interests of TRB over the parcels of land subject
of the Petition for Writ of Possession filed by the latter, be substituted as the new petitioner in LRC CAD. REC. NOS. 1
and 9616, and that an alias writ of possession be issued in her favor. The trial court granted petitioner's prayer in its On July 30, 2002, the CA promulgated its presently assailed Decision, the dispositive portion of which reads as
Order dated March 12, 1991.10 On April 1, 1991, the RTC issued an Alias Writ of Possession in favor of herein follows:
petitioner.11 WHEREFORE, premises considered, the Petition is GRANTED and the questioned four (4) rulings of the court a quo
are hereby declared NULL and VOID. No costs.

On August 24, 1994, the spouses Dayot filed with the RTC of Iloilo City, a complaint for Recovery of Ownership and
Possession, Annulment of Documents, Cancellation of Titles, Reconveyance and Damages against TRB, Petron Petitioner's Motion for Reconsideration was denied by the CA in its Resolution dated December 23, 2002.
Corporation (Petron) and herein respondent Shell Chemical Company (Phil.), Inc. (Shell), praying that Shell be
directed to vacate the portion of Lot No. 6153 which it actually possesses and for both Petron and Shell to surrender Hence, herein petition for review on certiorari, anchored on the following grounds:
ownership and possession of portions of parcels of lands covered separately by TCT Nos. T-47484 and T-94116. The
case was docketed as Civil Case No. 21957.12 1. THAT RESPONDENT IS BARRED FROM FILING THE PETITION FOR CERTIORARI WITH THE COURT OF APPEALS,
ASSAILING THE AMENDED ORDER DATED JANUARY 8, 2002 OF HON. RENE B. HONRADO, PRESIDING JUDGE,
On August 21, 1997, while Civil Case No. 21957 was pending resolution, herein petitioner filed in LRC CAD. REC. REGIONAL TRIAL COURT, ILOILO CITY, BRANCH 29, AFTER RESPONDENT LOST ITS RIGHT TO APPEAL BECAUSE A
NOS. 1 and 9616 an Amended Supplemental Motion for the Issuance of Writ of Possession, praying that Shell be SPECIAL CIVIL ACTION FOR CERTIORARI IS NOT AND CANNOT BE A SUBSTITUTE FOR A LOST OR EXPIRED
ejected from the portion of Lot 6153 which it actually possesses. APPEAL THUS, THE DECISION PROMULGATED JULY 30, 2002 AND THE RESOLUTION PROMULGATED DECEMBER
23, 2002 OF THE HONORABLE COURT OF APPEALS WERE ISSUED CONTRARY TO PREVAILING JURISPRUDENCE
Shell lodged an Opposition to petitioner's Amended Supplemental Motion arguing, among others, that petitioner is AND THAT SAID COURT DECIDED A QUESTION OF SUBSTANCE NOT IN ACCORD WITH LAW AND APPLICABLE
guilty of forum shopping as it seeks the same relief being sought in Civil Case No. 21957 and that the parcels of land DECISIONS OF THIS HONORABLE SUPREME COURT AND THE ACCEPTED AND USUAL COURSE OF JUDICIAL
sold to petitioner do not include the portion of Lot 6153 being possessed by Shell.13 PROCEEDINGS.

On May 7, 1999, the RTC of Iloilo, Branch 30 issued an Order denying herein petitioner's Motion for the Issuance of a 2. THAT PETITIONER IS ENTITLED TO THE POSSESSION OF THE ENTIRE LOTS 3834, 1-A, 6153, 6156, 6158 AND
Writ of Possession, insofar as Shell is concerned.14 6159 INCLUDING THE AREA OF 14,940 SQ. METERS OCCUPIED BY RESPONDENT WHICH AREAS ARE PORTIONS OF
LOTS 6153, 3834 AND 1-A, OCCUPATION THEREOF BY RESPONDENT BEING THAT OF MERE INTRUDER OR
TRESSPASSER.17
Despite the issuance of the above-mentioned Order, petitioner filed two successive motions praying for the issuance
of an alias writ of possession. Shell opposed these motions.
In her first assigned error, petitioner argues that respondent should have been barred from filing a special civil action
for certiorari before the CA because this recourse is available only when there is no speedy and adequate remedy in
Subsequently, the petition for the issuance of a writ of possession was re-raffled to Branch 29 of the RTC of Iloilo, as the course of law. Petitioner further argues that respondent should have appealed the Amended Order of the RTC
the presiding judge of Branch 30 inhibited himself from hearing the case. dated April 12, 2002, but it did not. Petitioner avers that respondent can no longer resort to the filing of a petition
for certiorari because this remedy is not a substitute for a lost appeal.
On January 8, 2002, Branch 29 promulgated an Amended Order, the dispositive portion of which reads:

32
Anent the second assigned error, petitioner claims that she is not guilty of forum shopping, as Civil Case No. 21957 The test to determine whether a party violated the rule against forum shopping is whether the elements of litis
involves the issue of ownership while the present case is for the recovery of possession; and that the subject matter pendentia are present, or whether a final judgment in one case will amount to res judicata in another. 22 In other
of the present case is different from that of Civil Case No. 21957. Even granting that the same parcels of land are words, when litis pendentia or res judicata does not exist, neither can forum shopping exist.23
involved in these cases, petitioner argues that a writ of possession can still be validly issued and implemented in
consonance with the rule that proceedings incident to extra-judicial foreclosure of mortgages to resolve the The requisites of litis pendentia are: (a) the identity of parties, or at least such as representing the same interests in
possession of third-party claimants may proceed independently of the action which said claimants may bring to both actions; (b) the identity of rights asserted and relief prayed for, the relief being founded on the same facts; and
enforce or protect their claim of ownership over the property. (c) the identity of the two cases such that judgment in one, regardless of which party is successful, would amount to
res judicata in the other.24
Lastly, petitioner asserts that respondent's TCT No. T-47484 refers to a lot which is different from those being
contested in the instant case. On the other hand, the elements of res judicata, also known as "bar by prior judgment," are: (1) the former
judgment must be final; (b) the court which rendered it had jurisdiction over the subject matter and the parties; (c)
In its Comment, respondent contends that it did not err in resorting to the remedy of filing a petition it must be a judgment on the merits; and (d) there must be, between the first and second actions, identity of parties,
for certiorari with the CA. It argues that even when appeal is available as a proper remedy, the Supreme Court will subject matter, and causes of action.25
allow a writ of certiorari if the petition appears to be genuinely meritorious or if filed on the basis of a patent,
capricious and whimsical exercise of discretion by a trial judge, or when an appeal will not promptly relieve petitioner It bears to note that the proceedings conducted subsequent to the filing of a petition for the issuance of a writ of
from the injurious effects of the disputed orders; that the Amended Order of the RTC dated January 8, 2002 possession are ex parte and summary in nature. The order for the issuance of the writ is simply an incident in the
collaterally attacked respondent's title over the disputed property; that petitioner is not a buyer in good faith; that, transfer of title in the name of the petitioner.26 Hence, such order cannot be said to be a judgment on the merits, i.e.,
as a transferee, petitioner merely acquired the rights and interests that TRB had by reason of the foreclosure of the one rendered after a consideration of the evidence or stipulations submitted by the parties at the trial of the case.
mortgage made in its favor; that the contested Alias Writ of Execution is barred by res judicata and litis pendentia; Thus, in the present case, any order or decision of the RTC in LRC CAD. REC. NOS. 1 and 9616 cannot be considered
and that respondent has the right to possess the disputed property as it has satisfactorily shown that it is the as determinative of the merits of Civil Case No. 21957.
registered owner of and has title over the subject property.

Moreover, the aforementioned cases cannot be said to be identical as the basic issue in LRC CAD. REC. NOS. 1 and
The Court finds the petition bereft of merit. 9616 is possession while in Civil Case No. 21957 the issue raised is essentially that of ownership of the disputed lots.

It bears to emphasize at the outset that the present petition for review arose by reason of the special civil action Based on the foregoing, there can be no litis pendentia or res judicata. Since neither litis pendentia nor res
for certiorari filed by respondent Shell with the CA questioning the January 8, 2002 Amended Order, Alias Writ of judicata exists in the instant case, petitioner may not be held guilty of forum shopping.
Possession, Notice to Vacate and the April 12, 2002 Order issued by the RTC of Iloilo, Branch 29. Accordingly, any
discussions on the issues raised as well as rulings by this Court in the present petition apply only insofar as the claim
of respondent Shell is concerned. Nonetheless, the Court finds that under applicable laws and jurisprudence, respondent cannot be ejected from the
property by means of an ex-parte writ of possession.

As to the first assigned error, it is true that as a rule while certiorari as a remedy may not be used as a substitute for
an appeal, especially for a lost appeal, this rule should not be strictly enforced if the petition is genuinely Article 433 of the Civil Code states:
meritorious.18 It has been held that where the rigid application of the rules would frustrate substantial justice, or bar Art. 433. Actual possession under claim of ownership raises a disputable presumption of ownership. The true owner
the vindication of a legitimate grievance, the courts are justified in exempting a particular case from the operation of must resort to judicial process for the recovery of the property.
the rules.19 The Court has given due course to petitions for certiorari although appeal is the proper remedy where the
equities of the case warranted such action, mindful that dismissals based on technicalities are looked upon with Under the aforequoted provision, one who claims to be the owner of a property possessed by another must bring the
disfavor.20 appropriate judicial action for its physical recovery. The term "judicial process" could mean no less than an ejectment
suit or reivindicatory action, in which the ownership claims of the contending parties may be properly heard and
In the present case, the Court finds no error on the part of the CA in giving due course to the petition adjudicated.27 In the present case, petitioner had already complied with this procedure by filing Civil Case No. 21957.
for certiorari filed by respondent as its case is genuinely meritorious for reasons that will be discussed forthwith.
The ex-parte petition for issuance of a possessory writ filed by petitioner's predecessor, TRB, in LRC CAD. REC. NOS.
As to the second assigned error, the Court agrees with petitioner that she is not guilty of forum shopping. 1 and 9616, strictly speaking, is not the kind of "judicial process" contemplated above. Even if the same may be
considered 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 or protection of a right, or
There is forum shopping when a party avails himself of several judicial remedies in different courts, simultaneously or the prevention or redress of a wrong."28
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 courts.21
The second paragraph of Section 33, Rule 39, of the Rules of Court relating to the right of possession of a purchaser
of property in an extra-judicial foreclosure sale provides:
Sec. 33. Deed and possession to be given at expiration of redemption period; by whom executed or given.

33
 xxx In the present case, the questioned Amended Order of the RTC Iloilo, Branch 29 dated January 8, 2002 was issued
Upon the expiration of the right of redemption, the purchaser or redemptioner shall be substituted to and acquire on the strength of the Writ of Possession issued by the RTC of Iloilo, Branch 30 dated October 24, 1990. It is clear
all the rights, title, interest and claim of the judgment obligor to the property at the time of levy. The possession of from the said writ that the sheriff is directed to eject PRI or any person claiming interest under it from Lot Nos. 3834,
the property shall be given to the purchaser or last redemptioner by the same officer unless a third party is 1-A, 6153, 6156, 6158 and 6159 and to place TRB in possession thereof. However, respondent is not a successor-in-
actually holding the property adversely to the judgment obligor. (emphasis supplied) interest of PRI. Instead, respondent claims ownership over the subject lot by virtue of a Deed of Absolute Sale dated
June 30, 1975, wherein the property was sold to it by the DBP. As a consequence of such sale, respondent obtained
Thus, in Barican v. Intermediate Appellate Court, 29 this Court held that the obligation of a court to issue a writ of TCT No. 47484 on July 28, 1977. Clearly, respondent's right of possession is adverse to that of PRI or TRB.
possession in favor of the purchaser in an extra-judicial foreclosure sale of a mortgaged property ceases to be
ministerial once it is shown that there is a third party in possession of the property who is claiming a right adverse to Furthermore, registration of the lots in petitioner’s name does not automatically entitle the latter to possession
that of the mortgagor and that such third party is a stranger to the foreclosure proceedings in which the  ex- thereof.35 As discussed earlier, petitioner must resort to the appropriate judicial process for recovery of the properties
parte writ of possession was applied for. and cannot simply invoke its title in an ex-parte proceeding to justify the ouster of respondent, 36 especially in view of
the fact that the latter also has in its possession a Transfer Certificate of Title over the subject properties. The court
It bears emphasis that an ex-parte petition for issuance of a writ of possession is a non-litigious proceeding cannot just ignore the claim of herein respondent, who is in actual possession of the subject properties, that it has
authorized in an extra-judicial foreclosure of mortgage pursuant to Act 3135, as amended. 30 It is brought for the been the owner thereof since 1975 and, therefore, has the better right to possess them. Neither can the RTC rely on
benefit of one party only, and without notice to, or consent by any person adversely interested.31 the Surveyor's Report dated August 3, 1997 because respondent was not given the opportunity to refute it, the same
being submitted in the ex-parte proceedings for the issuance of a writ of possession in favor of Dayot. Due process
dictates that herein respondent cannot simply be ejected on the strength of the subject Surveyor's Report without
Furthermore, unlike a judicial foreclosure of real estate mortgage under Rule 68 of the Rules of Court where an giving it (respondent) the opportunity to present its own evidence. All of these issues must be ventilated and
action for foreclosure is brought before the RTC where the mortgaged property or any part thereof is situated, any resolved on the merits after a proper hearing. In the instant case, the proper forum is Civil Case No. 21957.
property brought within the ambit of Act 3135 is foreclosed by the filing of a petition, not with any court of justice,
but with the office of the sheriff of the province where the sale is to be made. As such, a third person in
possession of an extra-judicially foreclosed property, who claims a right superior to that of the original Finally, it is expressly stipulated in the Additional Stipulations of Real Estate Mortgage executed by PRI in favor of
mortgagor, is thus given no opportunity to be heard in his claim. 32 It stands to reason, therefore, that such TRB that it "excludes those areas already sold to Shell Co., Inc. with total area of 14,920 sq. meters, known as Lot
third person may not be dispossessed on the strength of a mere ex-parte possessory writ, since to do so would be No. 6153-B and portion of Lot No. 5."37
tantamount to his summary ejectment, in violation of the basic tenets of due process.33
Petitioner insists that respondent's TCT No. T-47484 refers to a different parcel of land. Whether respondent's title
Besides, as earlier stressed, Article 433 of the Civil Code, cited above, requires nothing less than ejectment or refers to the same property subject of the present case and whether the parcels of land sold to herein petitioner are
reivindicatory action to be brought even by the true owner. After all, the actual possessor of a property enjoys a legal the same properties foreclosed by TRB are issues which should properly be resolved in Civil Case No. 21957. This is
presumption of just title in his favor, which must be overcome by the party claiming otherwise. not the proper forum to determine who between the parties is entitled to ownership of the disputed lands, as the
issue in the present case is merely limited to the propriety of the issuance of a writ of possession relating to
foreclosure of mortgage.
In the case at bar, it is not disputed that herein respondent had been in possession of the subject lots since 1975 and
that it has in its premises bulk plant and fuel storage facilities for the purpose of conducting its business. In this
respect, the Court agrees with the findings of the CA that petitioner had knowledge of respondent's prior possession WHEREFORE, the instant petition is DISMISSED. The Decision and Resolution of the Court of Appeals dated July
of the disputed properties. Yet, instead of pursuing Civil Action No. 21957 where respondent will be given a chance to 30, 2002 and December 23, 2002 in CA-G.R. SP. No. 70696 are AFFIRMED insofar as respondent Shell Chemical
substantiate its claim of ownership, petitioner still insists on obtaining a writ of possession pursuant to its alleged Company (Phils.), Inc. is concerned.
right as purchaser of the properties which had been extra-judicially foreclosed. The Court cannot sanction this
procedural shortcut. To enforce the writ against herein respondent, an unwitting third party possessor who took no
part in the foreclosure proceedings, would be tantamount to the taking of real property without the benefit of proper
judicial intervention.

Hence, it was not a ministerial duty of the trial court under Act No. 3135 to issue a writ of possession for the ouster
of respondent from the lot subject of this instant case, particularly in light of the latter's opposition and claim of G.R. No. 119247 February 17, 1997
ownership and rightful possession of the disputed properties.
CESAR SULIT, petitioner,
Moreover, the trial court was without authority to grant the ex-parte writ, since petitioner's right of possession under vs.
said Act could be rightfully enforced only against PRI as the original mortgagor and its successors-in-interest, 34 but COURT OF APPEALS and ILUMINADA CAYCO, respondents.
not against respondent which possesses the property subject of execution under a claim of ownership, having bought
the same from the Development Bank of the Philippines (DBP). The primary issue posed before the Court, in this appeal by certiorari from a decision1 of the Court of Appeals, is
whether or not the mortgagee or purchaser in an extrajudicial foreclosure sale is entitled to the issuance of a writ of
possession over the mortgaged property despite his failure to pay the surplus proceeds of the sale to the mortgagor

34
or the person entitled thereto. Secondarily, it calls for a resolution of the further consequences of such non-payment Accordingly, private respondent is ordered to pay unto petitioner, through the notary public, the balance or excess
of the full amount for which the property was sold to him pursuant to his bid. of his bid of P7 Million after deducting therefrom the sum of P4,365,280 which represents the mortgage debt and
interest up to the date of the auction sale (September 23, 1993), as well as expenses of foreclosure based on
It appears from the record that on 9 June 1992 petitioner (herein private respondent) Iluminada Cayco executed a receipts which must be presented to the notary public.
Real Estate Mortgage (REM) over Lot 2630 which is located in Caloocan City and covered by TCT No. (23211) 11591 In the event that private respondent fails or refuses to pay such excess or balance, then the auction sale of 28
in favor of private respondent (herein petitioner) Cesar Sulit, to secure a loan of P4 Million. Upon petitioner's failure September 1993 is deemed CANCELLED and private respondent may foreclose the mortgage anew either in a
to pay said loan within the stipulated period, private respondent resorted to extrajudicial foreclosure of the mortgage judicial or extrajudicial proceeding as stipulated in the mortgage contract.
as authorized in the contract. Hence, in a public auction conducted by Notary Public Felizardo M. Mercado on 28
September 1993 the lot was sold to the mortgagee, herein private respondent, who submitted a winning bid of P7 Corollary to the principal issue earlier stated, petitioner asserts that respondent Court of Appeals gravely erred when
Million. As stated in the Certificate of Sale executed by the notary public (Annex B, petition), the mortgaged property it failed to appreciate and consider the supposed legal significance of the bouncing checks which private respondent
was sold at public auction to satisfy the mortgage indebtedness of P4 Million. The Certificate further states as follows: issued and delivered to petitioner as payment for the agreed or stipulated interest on the mortgage obligation. He
IT IS FURTHER CERTIFIED, that the aforementioned highest bidder/buyer, CESAR SULIT, being the likewise avers that a motion for reconsideration or an appeal, and not certiorari, is the proper remedy available to
petitioner/mortgagee thereupon did not pay to the undersigned Notary Public of Kalookan City the said sum of herein private respondent from an order denying her motion to defer issuance of the writ of possession. Moreover, it
SEVEN MILLION PESOS (P7,000,000.00), Philippine Currency, the sale price of the above-described real estate is claimed that any question regarding the propriety of the sale and the issuance of the writ of possession must be
property together with all improvements existing thereon, which amount was properly credited to the PARTIAL threshed out in a summary proceeding provided for in Section 8 of Act 3135.
satisfaction of the mortgage debt mentioned in the said real estate mortgage, plus interests, attorney's fees and all
other incidental expenses of foreclosure and sale (par. 2, Annex B, petition). There is no merit in petitioner's contention that the dishonored checks amounting to a total of P1,250,000.00,
allegedly representing interest of 5% per month from June 9, 1992 to December 9, 1992, were correctly considered
On 13 December 1993 private respondent petitioned the Regional Trial Court of Kalookan City for the issuance of a by the trial court as the written agreement between the parties. Instead, we find the explanation of respondent court
writ of possession in his favor. The petition was docketed as LRC Case No. C-3462 and assigned to Branch 131, in rejecting such postulate, on the basis of Article 1956 of the Civil Code,3 to be more logical and plausible, to wit:
presided over by public respondent. It is noteworthy that the Deed of Real Estate Mortgage executed by the parties on 9 June 1992 (Annex A, Petition)
does not contain any stipulation for payment of interest. Private respondent who maintains that he had an
On 17 January 1994 respondent Judge issued a decision (should have been denominated as order), the dispositive agreement with petitioner for the payment of 5% monthly interest did not produce any other writing or instrument
part of which reads: embodying such a stipulation on interest. It appears then that if any such agreement was reached by the parties, it
WHEREFORE, finding the subject petition to be meritorious, the same is hereby GRANTED. As prayed for, let a Writ was merely a verbal one which does not conform to the aforequoted statutory provision. Certainly, the dishonored
of Possession be issued in favor of herein petitioner, Cesar Sulit, upon his posting of an indemnity bond in the checks claimed to have been issued by petitioner in payment of interest could not have been the written stipulation
amount of One Hundred Twenty Thousand (P120,000.00) Pesos (Annex C, petition). contemplated in Article 1956 of the Code. Consequently, in the absence of a written stipulation for the imposition of
interest on the loan obtained by petitioner, private respondent's assessment thereof has no legal basis.4

On 28 March 1994 petitioner filed a Motion to have the auction sale of the mortgaged property set aside and to defer
the issuance of the writ of possession. She invited the attention of the court a quo to some procedural infirmities in It is elementary that in the absence of a stipulation as to interest, the loan due will now earn interest at the legal rate
the said proceeding and further questioned the sufficiency of the amount of bond. In the same Motion petitioner of 12%  per annum 5 which, according to respondent court, is equivalent to P365,280.000.00 computed from
prayed as an alternative relief that private respondent be directed to pay the sum of P3 Million which represents the December 10, 1992, after private respondent's obligation became due, until September 23, 1993, the date of the
balance of his winning bid of P7 Million less the mortgage indebtedness of P4 Million (Annex D, petition). This Motion auction sale. It is this amount which should further be deducted from the purchase price of P7,000,000.00, together
was opposed by private respondent who contended that the issuance of a writ of possession upon his filing of a bond with any other expenses incurred in connection with the sale, such as the posting and publication of notices, notarial
was a ministerial duty on the part of respondent Judge (Annex E), to which Opposition petitioner submitted a Reply and documentary fees, and assessments or taxes due on the disputed property.
(Annex F, petition).
It baffles this Court, therefore, why petitioner has continually failed up to the present to submit documentary
On 11 May 1994 respondent Judge denied petitioner's Motion and directed the issuance of a writ of possession and evidence of the alleged expenses of the foreclosure sale, and this in spite of the express requirement therefor in the
its immediate enforcement by deputy sheriff Danilo Norberte (Annex G, petition)."2 (Emphasis words supplied for certificate of sale6 issued by the notary public for the purpose of computing the actual amount payable by the
clarity). mortgagor or redemptioner in the event of redemption. It may thus be safely presumed that such evidence having
been willfully suppressed, it would be adverse if produced.7

From the aforesaid orders of the court a quo, herein private respondent Iluminada Cayco filed on May 26, 1994 a
petition for certiorari with preliminary injunction and/or temporary restraining order before respondent Court of Coming now to the main issue in this case, petitioner argues that it is ministerial upon the court to issue a writ of
Appeals, which immediately issued a status quo order restraining the respondent judge therein from implementing possession after the foreclosure sale and during the period of redemption, invoking in support thereof Sections 7 and
his order of January 17, 1994 and the writ of possession issued pursuant thereto. Subsequently, respondent court 8 of Act 3135 which conjointly provide:
rendered judgment on November 11, 1994, as follows:
IN JUDGMENT, We grant the writ of certiorari and the disputed order of 17 January 1994 which precipitately Sec. 7. In any sale made under the provisions of this Act, the purchaser may petition the Court of First Instance of
directed the issuance of a writ of possession in favor of private respondent and the subsequent order of 11 May the province or place where the property or any part thereof is situated, to give him possession thereof during the
1994 which denied petitioner's Motion for Reconsideration are hereby SET ASIDE. redemption period, furnishing bond in an amount equivalent to the use of the property for a period of twelve

35
 months, to indemnify the debtor in case it be shown that the sale was made without violating the mortgage or since the judgment debtor may reacquire the property or sell his right to redeem, and thus recover the loss he claims
without complying with the requirements of this Act. Such petition shall be made under oath and filed in form of to have suffered by reason of the price obtained at the auction sale. 12
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- However, also by way of an exception, in Cometa, et al. vs. Intermediate Appellate Court, et al. 13 where the
four of the Administrative Code, or of any other real property encumbered with a mortgage duly registered in the properties in question were found to have been sold at an unusually lower price than their true value, that is,
office of any register of deeds in accordance with any existing law, and in each case the clerk of the court shall, properties worth at least P500,000.00 were sold for only P57,396.85, this Court, taking into consideration the factual
upon the filing of such petition, collect the fees specified in paragraph eleven of section one hundred and fourteen milieu obtaining therein as well as the peculiar circumstances attendant thereto, decided to withhold the issuance of
of Act Numbered Twenty-eight hundred and sixty-six, and the court shall, upon approval of the bond, order that a the writ of possession on the ground that it could work injustice because the petitioner might not be entitled to the
writ of possession issue, addressed to the sheriff of the province in which the property is situated, who shall same.
execute said order immediately.

The case at bar is quite the reverse, in the sense that instead of an inadequacy in price, there is due in favor of
Sec. 8. The debtor may, in the proceedings in which possession was requested, but not later than thirty days after private respondent, as mortgagor, a surplus from the proceeds of the sale equivalent to approximately 40% of the
the purchaser was given possession, petition that the sale be set aside and the writ of possession cancelled, total mortgage debt, which excess is indisputably a substantial amount. Nevertheless, it is our considered opinion,
specifying the damages suffered by him, because the mortgage was not violated or the sale was not made in and we so hold, that equitable considerations demand that a writ of possession should also not issue in this case.
accordance with the provisions hereof, and the Court shall take cognizance of this petition in accordance with the
summary procedure provided for in section one hundred and twelve of Act Number Four hundred and ninety-six;
and if it finds the complaint of the debtor justified, it shall dispose in his favor of all or part of the bond furnished by Rule 68 of the Rules of Court provides:
the person who obtained possession. Either of the parties may appeal from the order of the judge in accordance Sec. 4. Disposition of proceeds of sale. — The money realized from the sale of mortgaged property under the
with section fourteen of Act Numbered Four hundred and ninety-six; but the order of possession shall continue in regulations hereinbefore prescribed shall, after deducting the costs of the sale, be paid to the person foreclosing
effect during the pendency of the appeal. the mortgage, and when there shall be any balance or residue, after paying off such mortgage or other
incumbrances, the same shall be paid to the junior incumbrancers in the order of their priority, to be ascertained by
the court, or if there be no such incumbrancers or there be a balance or residue after payment of such
The governing law thus explicitly authorizes the purchaser in a foreclosure sale to apply for a writ of possession incumbrancers, then to the mortgagor or his agent, or to the person entitled to it.
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. 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 The application of the proceeds from the sale of the mortgaged property to the mortgagor's obligation is an act of
possession. payment, not payment by dation; hence, it is the mortgagee's duty to return any surplus in the selling price to the
mortgagor. 14 Perforce, a mortgagee who exercises the power of sale contained in a mortgage is considered a
custodian of the fund, and, being bound to apply it properly, is liable to the persons entitled thereto if he fails to do
No discretion appears to be left to the court. Any question regarding the regularity and validity of the sale, as well as so. And even though the mortgagee is not strictly considered a trustee in a purely equitable sense, but as far as
the consequent cancellation of the writ, is to be determined in a subsequent proceeding as outlined in Section 8, and concerns the unconsumed balance, the mortgagee is deemed a trustee for the mortgagor or owner of the equity of
it cannot be raised as a justification for opposing the issuance of the writ of possession since, under the Act, the redemption. 15
proceeding for this is ex parte.8 Such recourse is available to a mortgagee, who effects the extrajudicial foreclosure
of the mortgage, even before the expiration of the period of redemption provided by law and the Rules of Court.9
Commenting on the theory that a mortgagee, when he sells under a power, cannot be considered otherwise than as
a trustee, the vice-chancellor in Robertson vs. Norris (1 Giff  . 421) observed: "That expression is to be understood in
The rule is, however, not without exception. Under Section 35, Rule 39 of the Rules of Court, which is made this sense: that with the power being given to enable him to recover the mortgage money, the court requires that he
applicable to the extrajudicial foreclosure of real estate mortgages by Section 6 of Act 3135, the possession of the shall exercise the power of sale in a provident way, with a due regard to the rights and interests of the mortgagor in
mortgaged property may be awarded to a purchaser in the extrajudicial foreclosure "unless a third party is actually the surplus money to be produced by the sale." 16
holding the property adversely to the judgment debtor." 10

The general rule that mere inadequacy of price is not sufficient to set aside a foreclosure sale is based on the theory
Thus, in the case of Barican, et al. vs. Intermediate Appellate Court, et al., 11 this Court took into account the that the lesser the price the easier it will be for the owner to effect the redemption. 17 The same thing cannot be said
circumstances that long before the mortgagee bank had sold the disputed property to the respondent therein, it was where the amount of the bid is in excess of the total mortgage debt. The reason is that in case the mortgagor
no longer the judgment debtor who was in possession but the petitioner spouses who had assumed the mortgage, decides to exercise his right of redemption, Section 30 of Rule 39 provides that the redemption price should be
and that there was a pending civil case involving the rights of third parties. Hence, it was ruled therein that under the equivalent to the amount of the purchase price, plus one per cent monthly interest up to the time of the
circumstances, the obligation of a court to issue a writ of possession in favor of the purchaser in a foreclosure of redemption, 18 together with the amount of any assessments or taxes which the purchaser may have paid thereon
mortgage case ceases to be ministerial. after purchase, and interest on such last-named amount at the same rate. 19

Now, in forced sales low prices are generally offered and the mere inadequacy of the price obtained at the sheriff's Applying this provision to the present case would be highly iniquitous if the amount required for redemption is based
sale, unless shocking to the conscience, has been held insufficient to set aside a sale. This is because no on P7,000.000.00, because that would mean exacting payment at a price unjustifiably higher than the real amount of
disadvantage is caused to the mortgagor. On the contrary, a mortgagor stands to gain with a reduced price because the mortgage obligation. We need not elucidate on the obvious. Simply put, such a construction will undeniably be
he possesses the right of redemption. When there is the right to redeem, inadequacy of price becomes immaterial

36
prejudicial to the substantive rights of private respondent and it could even effectively prevent her from exercising and respondent Court of Appeals have found that the sale was conducted in accordance with law. No compelling
the right of redemption. reason exists in this case to justify a rejection of their findings or a reversal of their conclusions.

Where the redemptioner chooses to exercise his right of redemption, it is the policy of the law to aid rather than to There is likewise no merit in the argument that if private respondent had wanted to question the validity of the sale,
defeat his right. It stands to reason, therefore, that redemption should be looked upon with favor and where no she should have filed a petition to set the same aside and to cancel the writ of possession. These, it is argued, should
injury will follow, a liberal construction will be given to our redemption laws, specifically on the exercise of the right have been disposed of in accordance with the summary procedure laid down in Section 112 of the Land Registration
to redeem. Conformably hereto, and taking into consideration the facts obtaining in this case, it is more in keeping Act, provided the petition is filed not later than thirty days after the purchaser was given possession of the land.
with the spirit of the rules, particularly Section 30 of Rule 39, that we adopt such interpretation as may be favorable Considering, however, that private respondent has filed a motion to set aside the sale and to defer the issuance of a
to the private respondent. writ of possession before the court where the ex parte petition for issuance of such writ was then pending, we deem
the same to be substantial compliance with the statutory prescription.
Admittedly, no payment was made by herein petitioner, as the highest bidder, to the notary public who conducted
the extrajudicial foreclosure sale. We are not unmindful of the rule that it is not necessary for the mortgagee to pay We, however, take exception to and reject the last paragraph in the dispositive portion of the questioned decision of
cash to the sheriff or, in this case, the notary public who conducted the sale. It would obviously serve no purpose for respondent court, which we repeat:
the sheriff or the notary public to go through the idle ceremony of receiving the money and paying it back to the In the event that private respondent fails or refuses to pay such excess or balance, then the auction sale of 28
creditor, under the truism that the lawmaking body did not contemplate such a pointless application of the law in September 1993 is deemed CANCELLED and private respondent (petitioner herein) may foreclose the mortgage
requiring that the creditor must bid under the same conditions as any other bidder. 20 It bears stressing that the rule anew either in a judicial or extrajudicial proceeding as stipulated in the mortgage contract.
holds true only where the amount of the bid represents the total amount of the mortgage debt. for lack of statutory and jurisprudential bases. The quoted phrase "as stipulated in the mortgage contract" does not,
of course, envision such contingency or warrant the suggested alternative procedure.
In case of a surplus in the purchase price, however, there is jurisprudence to the effect that while the mortgagee
ordinarily is liable only for such surplus as actually comes into his hands, but he sells on credit instead of for cash, he Section 4 of Rule 64, hereinbefore quoted, merely provides that where there is a balance or residue after payment of
must still account for the proceeds as if the price were paid in cash, and in an action against the mortgagee to the mortgage, the same shall be paid to the mortgagor. While the expedient course desired by respondent court is
recover the surplus, the latter cannot raise the defense that no actual cash was received. 21 commendable, there is nothing in the cited provision from which it can be inferred that a violation thereof will have
the effect of nullifying the sale. The better rule is that if the mortgagee is retaining more of the proceeds of the sale
We cannot simply ignore the importance of surplus proceeds because by their very nature, surplus money arising than he is entitled to, this fact alone will not affect the validity of the sale but simply gives the mortgagor a cause of
from a sale of land under a decree of foreclosure stands in the place of the land itself with respect to liens thereon or action to recover such surplus. 27 This is likewise in harmony with the decisional rule that in suing for the return of
vested rights therein. They are constructively, at least, real property and belong to the mortgagor or his the surplus proceeds, the mortgagor is deemed to have affirmed the validity of the sale since nothing is due if no
assigns. 22 Inevitably, the right of a mortgagor to the surplus proceeds is a substantial right which must prevail over valid sale has been made. 28
rules of technicality.
In the early case of Caparas vs. Yatco, etc., et al., 29 it was also held that where the mortgagee has been ordered by
Surplus money, in case of a foreclosure sale, gains much significance where there are junior encumbrancers on the the court to return the surplus to the mortgagor or the person entitled thereto, and the former fails to do so and
mortgaged property. Jurisprudence has it that when there are several liens upon the premises, the surplus money flagrantly disobeys the order, the court can cite the mortgagee for contempt and mete out the corresponding penalty
must be applied to their discharge in the order of their priority. 23 A junior mortgagee may have his rights protected under Section 3(b) of the former Rule 64 (now Rule 71) of the Rules of Court.
by an appropriate decree as to the application of the surplus, if there be any, after satisfying the prior mortgage. His
lien on the land is transferred to the surplus fund. 24 And a senior mortgagee, realizing more than the amount of his WHEREFORE, the questioned decision of the Court of Appeals is MODIFIED by deleting the last paragraph of its  fallo,
debt on a foreclosure sale, is regarded as a trustee for the benefit of junior encumbrancers. 25 but its disposition of this case in all other respects is hereby AFFIRMED.

Upon the strength of the foregoing considerations, we cannot countenance the apparent paltriness that petitioner
persistently accords the right of private respondent over the surplus proceeds. It must be emphasized that petitioner
failed to present the receipts or any other proof of the alleged costs or expenses incurred by him in the foreclosure
sale. Even the trial court failed or refused to resolve this issue, notwithstanding the fact that this was one of the
grounds raised in the motion filed by private respondent before it to set aside the sale. Since it has never been
denied that the bid price greatly exceeded the mortgage debt, petitioner cannot be allowed to unjustly enrich himself
at the expense of private respondent.

As regards the issue concerning the alleged defect in the publication of the notice of the sale, suffice it to state for
purposes of this discussion that a question of non-compliance with the notice and publication requirements of an
extrajudicial foreclosure sale is a factual issue and the resolution thereof by the lower courts is binding and
conclusive upon this Court, 26 absent any showing of grave abuse of discretion. In the case at bar, both the trial court
G.R. No. 159882               November 23, 2007

37
SPOUSES RUBEN and VIOLETA SAGUAN, Petitioners, Hence, this recourse.
vs.
PHILIPPINE BANK OF COMMUNICATIONS and COURT OF APPEALS (Second Division), Respondents. In this appeal, the issues for our resolution are:
1. Whether the RTC should have issued a writ of possession considering respondent’s failure to remit the excess or
This is a petition for review on certiorari1 of the Decision2 dated January 24, 2003 and of the Resolution3 dated surplus proceeds of the extrajudicial foreclosure sale.
August 21, 2003 of the Court of Appeals (CA) in CA-G.R. SP No. 71775. The Decision affirmed the Orders 4 of the 2. Corollary thereto, whether respondent may unilaterally apply the excess or surplus proceeds of the extrajudicial
Regional Trial Court (RTC) of Branch 31, Tagum City, Davao: (1) dated November 5, 2001 admitting respondent foreclosure sale to petitioner’s remaining unsecured obligations.
Philippine Bank of Communications’ Exhibits "A" to "P"; (2) dated March 19, 2002 denying petitioners’, spouses 3. Whether the RTC should have granted petitioners’ motion to dismiss the petition for writ of possession based on
Ruben and Violeta Saguan’s, Motion to Present Evidence, and granting private respondent’s petition for issuance of a respondent’s failure to comply with the RTC’s Orders on the filing of a formal offer of evidence.
writ of possession; and (3) dated May 6, 2002 denying petitioners’ Motion for Reconsideration of the second order.
A writ of possession is an order enforcing a judgment to allow a person’s recovery of possession of real or personal
[Petitioners] spouses Ruben Saguan and Violeta Saguan obtained a loan of ₱3 Million from [respondent] Philippine property. An instance when a writ of possession may issue is under Act No. 3135, 15 as amended by Act No. 4118, on
Bank of Communications. To secure the obligation, they mortgaged five parcels of land covered by TCT Nos. 24274, extrajudicial foreclosure of real estate mortgage.16 Sections 6 and 7 provide, to wit:
38894, 37455, 66339 and 19365, all of the Register of Deeds of the Province of Davao, and improvements therein.
Section 6. Redemption. – In all cases in which an extrajudicial sale is made under the special power herein before
Because [petitioners] defaulted in the payment of their mortgage indebtedness, [respondent] extra-judicially referred to, the debtor, his successors-in-interest or any judicial creditor or judgment creditor of said debtor or any
foreclosed the mortgage. In the auction sale on 05 January 1998, [respondent] was the only and highest bidder for person having a lien on the property subsequent to the mortgage or deed of trust under which the property is sold,
₱6,008,026.74. Sheriff’s certificate of sale dated 12 January 1998 was executed and annotated at the back of may redeem the same at anytime within the term of one year from and after the date of the sale; and such
[petitioners’] titles on 18 February 1998. As [petitioners] failed to redeem the properties within the one-year period redemption shall be governed by the provisions of section four hundred and sixty-four to four hundred and sixty-
ending on 18 February 1999, TCT Nos. T-154065, T-154066, T-154067, T-154068 and T-154069 were issued in the six, inclusive, of the Code of Civil Procedure, in so far as these are not inconsistent with the provisions of this Act.
name of [respondent] in lieu of the old ones. Thus, [respondent] consolidated ownership of the properties in its
favor. Since the parcels of land were in physical possession of [petitioners] and other persons [co-petitioners in the Section 7. Possession during redemption period. – In any sale made under the provisions of this Act, the purchaser
petition before the CA], [respondent], after due demand, filed a petition for writ of possession with Branch 31, may petition the Court of First Instance of the province or place where the property or any part thereof is situated,
Regional Trial Court, Tagum City. x x x.5 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
Petitioners filed an Opposition6 to the petition for writ of possession to which respondent filed a without violating the mortgage or without complying with the requirements of this Act. Such petition shall be made
Comment.7 Petitioners likewise filed a Reply8 to the Comment. under oath and filed in [the] form of an ex-parte motion in the registration or cadastral proceedings if the property
is registered, or in special proceedings in case of property registered under the Mortgage Law or under section one
In their Opposition and Reply, petitioners argued that a writ of possession should not issue considering respondent’s hundred and ninety-four of the Administrative Code, or of any other real property encumbered with a mortgage
failure to return the excess or surplus proceeds9 of the extrajudicial foreclosure sale based on our ruling in Sulit v. duly registered in the office of any register of deeds in accordance with any existing law, and in each case the clerk
Court of Appeals.10 In refutation, respondent points to petitioners’ remaining unsecured obligations with the former to of court shall, upon the filing of such petition, collect the fees specified in paragraph eleven of section one hundred
which the excess or surplus proceeds were applied. and fourteen of Act Number Four hundred and ninety-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.
After the hearing on respondent’s evidence, the RTC issued two (2) separate orders requiring respondent to file a
Formal Offer of Evidence. Respondent failed to comply with the aforesaid orders within the time frame prescribed,
thus prompting petitioners to file a motion to dismiss grounded on Section 3,11 Rule 17 of the Rules of Court. From the foregoing provisions, a writ of possession may be issued either (1) within the one-year redemption period,
upon the filing of a bond, or (2) after the lapse of the redemption period, without need of a bond.17

Thereafter, respondent belatedly filed its Formal Offer of Evidence. Consequently, the RTC issued the first assailed
Order12 admitting respondent’s offer of exhibits thereby rendering petitioners’ motion to dismiss moot and academic. Within the redemption period the purchaser in a foreclosure sale may apply for a writ of possession by filing for that
The RTC then issued the Order13 denying petitioners’ Motion to Present Evidence and granted the petition for writ of purpose an ex-parte motion under oath, in the corresponding registration or cadastral proceeding in the case of
possession. The last Order14 of the RTC denied petitioners’ Motion for Reconsideration. property covered by a Torrens title. Upon the filing of an ex-parte motion and the approval of the corresponding
bond, the court is expressly directed to issue the order for a writ of possession.18

Upon petition for certiorari and mandamus, the CA rejected petitioners’ allegations of grave abuse of discretion in the
lower court’s issuance of the foregoing Orders. The CA affirmed respondent’s entitlement to a writ of possession as a On the other hand, after the lapse of the redemption period, a writ of possession may be issued in favor of the
matter of right, the latter having consolidated its ownership over the parcels of land upon expiration of the purchaser in a foreclosure sale as the mortgagor is now considered to have lost interest over the foreclosed
redemption period. It emphasized that the issue on the failure to return the excess or surplus proceeds of the auction property.19 Consequently, the purchaser, who has a right to possession after the expiration of the redemption period,
sale had been squarely met by the respondent, and therefore, the case was distinguishable from Sulit v. Court of becomes the absolute owner of the property when no redemption is made.20 In this regard, the bond is no longer
Appeals. In all, the CA upheld the general rule that the issuance of a writ of possession to a purchaser in an needed. The purchaser can demand possession at any time following the consolidation of ownership in his name and
extrajudicial foreclosure sale becomes merely a ministerial function of the court. the issuance to him of a new TCT. After consolidation of title in the purchaser’s name for failure of the mortgagor to

38
redeem the property, the purchaser’s right to possession ripens into the absolute right of a confirmed owner. At that Article 427,25 in relation to Article 428,26 of the Civil Code provides that ownership may be exercised over things or
point, the issuance of a writ of possession, upon proper application and proof of title, to a purchaser in an rights, and grants the owner of property a right of action for recovery against the holder and possessor thereof.
extrajudicial foreclosure sale becomes merely a ministerial function.21 Effectively, the court cannot exercise its
discretion. Thus, even as we rule that the writ of possession was properly issued in favor of respondent as a consequence of its
confirmed ownership, we are not unmindful of the fact that the issue of the excess or surplus proceeds of the
Therefore, the issuance by the RTC of a writ of possession in favor of the respondent in this case is proper. We have foreclosure sale remains unsettled.
consistently held that the duty of the trial court to grant a writ of possession in such instances is ministerial, and the
court may not exercise discretion or judgment. 22 The propriety of the issuance of the writ was heightened in this case Respondent’s stance, as sustained by the CA, is that petitioners have remaining unsecured obligations with
where the respondent’s right to possession of the properties extended after the expiration of the redemption period, respondent and the excess or surplus proceeds of the foreclosure sale were validly, albeit unilaterally, applied
and became absolute upon the petitioners’ failure to redeem the mortgaged properties. thereto.

Notwithstanding the foregoing, the petitioners insist that respondent’s failure to return the excess or surplus This argument is unacceptable.
proceeds of the extrajudicial foreclosure sale converted the issuance of a writ of possession from a ministerial to a
discretionary function of the trial court pursuant to our holding in Sulit v. Court of Appeals.23
We have elucidated on the import of surplus proceeds in the case of Sulit, viz.:

We are not persuaded.

In case of a surplus in the purchase price, however, there is jurisprudence to the effect that while the mortgagee
ordinarily is liable only for such surplus as actually comes into his hands, but he sells on credit instead of for cash,
A careful reading of Sulit will readily show that it was decided under a different factual milieu. In Sulit, the plea for a he must still account for the proceeds as if the price were paid in cash, and in an action against the mortgagee to
writ of possession was made during the redemption period and title to the property had not, as yet, been recover the surplus, the latter cannot raise the defense that no actual cash was received.
consolidated in favor of the purchaser in the foreclosure sale. In stark contrast, the herein petitioners failed to
exercise their right of redemption within the one-year reglementary period provided under Section 6 of Act No. 3135,
as amended, and ownership over the properties was consolidated in, and corresponding titles issued in favor of, the We cannot simply ignore the importance of surplus proceeds because by their very nature, surplus money arising
respondent. from a sale of land under a decree of foreclosure stands in the place of the land itself with respect to liens thereon
or vested rights therein. They are constructively, at least, real property and belong to the mortgagor or his assigns.
Inevitably, the right of a mortgagor to the surplus proceeds is a substantial right which must prevail over rules of
We emphasize that the proceeding in a petition for a writ of possession is ex-parte and summary in nature. It is a technicality.
judicial proceeding brought for the benefit of one party only and without need of notice to any person claiming an
adverse interest. It is a proceeding wherein relief is granted even without giving the person against whom the relief
is sought an opportunity to be heard.24 By its very nature, an ex-parte petition for issuance of a writ of possession is Surplus money, in case of a foreclosure sale, gains much significance where there are junior encumbrancers on the
a non-litigious proceeding authorized under Act No. 3135, as amended. mortgaged property. Jurisprudence has it that when there are several liens upon the premises, the surplus money
must be applied to their discharge in the order of their priority. A junior mortgagee may have his rights protected
by an appropriate decree as to the application of the surplus, if there be any, after satisfying the prior mortgage.
Be that as it may, the debtor or mortgagor is not without recourse. Section 8 of Act No. 3135, as amended, provides: His lien on the land is transferred to the surplus fund. And a senior mortgagee, realizing more than the amount of
Section 8. Setting aside of sale and writ of possession. – The debtor may, in the proceedings in which possession his debt on a foreclosure sale, is regarded as a trustee for the benefit of junior encumbrancers.27
was requested, but not later than thirty days after the purchaser was given possession, petition that the sale be set
aside and the writ of possession cancelled, specifying the damages suffered by him, because the mortgage was not
violated or the sale was not made in accordance with the provisions hereof, and the court shall take cognizance of Given the foregoing pronouncement in Sulit, we cannot countenance respondent’s cavalier attitude towards
this petition in accordance with the summary procedure provided for in section one hundred and twelve of Act petitioners’ right to the surplus proceeds. To begin with, the foreclosure of petitioners’ properties was meant to
Numbered Four hundred and ninety-six; and if it finds the complaint of the debtor justified, it shall dispose in his answer only the obligation secured by the mortgage. Article 2126 of the Civil Code unequivocally states:
favor of all or part of the bond furnished by the person who obtained possession. Either of the parties may appeal Art. 2126. The mortgage directly and immediately subjects the property upon which it is imposed, whoever the
from the order of the judge in accordance with section fourteen of Act Numbered Four hundred and ninety-six; but possessor may be, to the fulfillment of the obligation for whose security it was constituted.
the order of possession shall continue in effect during the pendency of the appeal.
We need not expound on the obvious. Simply put, even if petitioners have remaining obligations with respondent,
Thus, a party may file a petition to set aside the foreclosure sale and to cancel the writ of possession in the same these obligations, as conceded by respondent itself, were not collateralized by the foreclosed properties.1avvphi1
proceedings where the writ of possession was requested. However, in this case, petitioners do not challenge the
validity of the foreclosure nor do they wish to set aside the foreclosure sale. It appears that the only remaining bone Furthermore, under Section 128 of Act No. 3135 as amended, the special power of attorney authorizing the
of contention is the disposition of the excess or surplus proceeds of the foreclosure sale. In short, petitioners do not extrajudicial foreclosure of the real estate mortgage must be either (1) inserted or stated in the mortgage deed
question the consolidation of ownership in favor of the respondent, but simply demand the payment of the sum of itself; or (2) the authority is attached thereto. Thus, petitioners’ supposed remaining obligations which were not
money supposedly still owing them from the latter. secured by the mortgage cannot be made subject, or even susceptible, to the extrajudicial foreclosure of mortgage.

39
However, petitioners’ remedy lies in a separate civil action for collection of a sum of money.29 We have previously
held that where the mortgagee retains more of the proceeds of the sale than he is entitled to, this fact alone will not
affect the validity of the sale but simply give the mortgagor a cause of action to recover such surplus. 30 In the same TERESITA MONZON,   G.R. No. 171827
case, both parties can establish their respective rights and obligations to one another, after a proper liquidation of Petitioner, Present:
the expenses of the foreclosure sale, and other interests and claims chargeable to the purchase price of the - versus - YNARES-SANTIAGO, J.,
foreclosed property. The court can then determine the proper application of compensation with respect to SPS. JAMES & MARIA ROSA NIEVES RELOVA and SPS. Chairperson,
respondent’s claim on petitioners’ remaining unsecured obligations.31 In this regard, respondent is not precluded from BIENVENIDO & EUFRACIA PEREZ, AUSTRIA-MARTINEZ,
itself filing a case to collect on petitioners’ remaining debt. Respondents. CHICO-NAZARIO,
- versus - NACHURA, and
ADDIO PROPERTIES, INC., REYES, JJ.
Anent the third issue, we agree with the CA that there was no grave abuse of discretion in the trial court’s liberality
Intervenor. Promulgated:
in giving ample time and opportunity for respondent to complete the presentation of its evidence. It was a liberality
September 17, 2008
that carried no taint of partiality. Despite the ex-parte nature of the proceedings, the RTC also allowed petitioners to
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
file pleadings to oppose the petition for the issuance of the writ of possession. Clearly, petitioners were not denied
due process, and the trial judge acted accordingly in admitting respondent’s uncontroverted evidence.
This is a Petition for Review on Certiorari assailing the Decision 1 of the Court of Appeals dated 27
September 2005 and its Resolution dated 7 March 2006 in CA-G.R. CV No. 83507 affirming the Decision
Finally, we note petitioners’ incorrect remedy of certiorari before the CA, which the latter and both parties have
of the Regional Trial Court (RTC) of Tagaytay City, Branch 18.
apparently overlooked. A special civil action for certiorari may be availed of only if the lower tribunal has acted
without or in excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction, and
if there is no appeal or any other plain, speedy, and adequate remedy in the ordinary course of law.321âwphi1 On 18 October 2000, the spouses James and Maria Rosa Nieves Relova and the spouses Bienvenido and
Eufracia Perez, respondents before this Court, filed against Atty. Ana Liza Luna, Clerk of Court of Branch
18 of the RTC of Tagaytay City, and herein petitioner Teresita Monzon an initiatory pleading captioned as
Ineluctably, the RTC issued the writ of possession in compliance with the express provisions of Act No. 3135. It
a Petition for Injunction. The case, which was filed before the same Branch 18 of the RTC of Tagaytay
cannot, therefore, be charged with grave abuse of discretion as there is no showing that, in the exercise of its
City, was docketed as Civil Case No. TG-2069.
judgment, it acted in a capricious, whimsical, arbitrary or despotic manner tantamount to lack of jurisdiction. Absent
grave abuse of discretion, petitioners should have filed an ordinary appeal instead of a petition for certiorari. The
soundness of the order granting the writ of possession is a matter of judgment with respect to which the remedy of In their Petition for Injunction, respondents alleged that on 28 December 1998, Monzon executed a
the party aggrieved is ordinary appeal. An error of judgment committed by a court in the exercise of its legitimate promissory note in favor of the spouses Perez for the amount of P600,000.00, with interest of five
jurisdiction is not the same as "grave abuse of discretion." Errors of judgment are correctible by appeal, while those percent per month, payable on or before 28 December 1999. This was secured by a 300-square meter
of jurisdiction are reviewable by certiorari.33 lot in Barangay Kaybagal, Tagaytay City. Denominated as Lot No. 2A, this lot is a portion of Psu-232001,
covered by Tax Declaration No. 98-008-1793. On 31 December 1998, Monzon executed a Deed of
Absolute Sale over the said parcel of land in favor of the spouses Perez.
Nonetheless, we have allowed this procedural lapse to pass without incident, and have resolved the issues raised.

Respondents also claim in their Petition for Injunction that on 29 March 1999, Monzon executed another
WHEREFORE, the Petition is DENIED. The writ of possession in favor of respondent Philippine Bank of
promissory note, this time in favor of the spouses Relova for the amount of P200,000.00 with interest of
Communications is hereby AFFIRMED without prejudice to petitioners’ separate remedy for recovery of the excess or
five percent per month payable on or before 31 December 1999. This loan was secured by a 200 square
surplus proceeds of the extrajudicial foreclosure sale. Costs against the petitioner.
meter lot, denominated as Lot No. 2B, another portion of the aforementioned Psu-232001 covered by
Tax Declaration No. 98-008-1793. On 27 December 1999, Monzon executed a Deed of Conditional Sale
over said parcel of land in favor of the spouses Relova.

On 23 October 1999, the Coastal Lending Corporation extrajudicially foreclosed the entire 9,967-square
meter property covered by Psu-232001, including the portions mortgaged and subsequently sold to
respondents. According to the Petition for Injunction, Monzon was indebted to the Coastal Lending
Corporation in the total amount of P3,398,832.35. The winning bidder in the extrajudicial foreclosure,
Addio Properties Inc., paid the amount of P5,001,127.00, thus leaving a P1,602,393.65 residue.
According to respondents, this residue amount, which is in the custody of Atty. Luna as Branch Clerk of
Court, should be turned over to them pursuant to Section 4, Rule 68 of the Revised Rules of Civil
Procedure. Thus, respondents pray in their Petition for Injunction for a judgment (1) finding Monzon
liable to the spouses Perez in the amount of P1,215,000.00 and to the spouses Relova in the amount
of P385,000.00; (2) ordering Atty. Luna to deliver said amounts to respondents; and (3) restraining Atty.

40
Luna from delivering any amount to Monzon pending such delivery in number (2). one’s defense. What the law proscribes is lack of opportunity to be heard. Monzon’s Motion for
Reconsideration was denied in a Resolution dated 7 March 2006.
Monzon, in her Answer, claimed that the Petition for Injunction should be dismissed for failure to state a
cause of action. On 27 March 2006, Monzon filed the instant Petition for Review on Certiorari under Rule 45 of the Rules
of Court.
Monzon likewise claimed that respondents could no longer ask for the enforcement of the two promissory
notes because she had already performed her obligation to them by dacion en pago as evidenced by the Monzon claims anew that it was a violation of her right to due process of law for the RTC to render its
Deed of Conditional Sale and the Deed of Absolute Sale. She claimed that petitioners could still claim the Decision immediately after respondents presented their evidence ex parte without giving her a chance to
portions sold to them if they would only file the proper civil cases. As regards the fund in the custody of present her evidence. Monzon stresses that she was never declared in default by the trial court. The trial
Atty. Luna, respondents cannot acquire the same without a writ of preliminary attachment or a writ of court should have, thus, set the case for hearing for the reception of the evidence of the defense. She
garnishment in accordance with the provisions of Rule 57 and Section 9(c), Rule 39 of the Revised Rules claims that she never waived her right to present evidence.
of Civil Procedure.
Monzon argues that had she been given the opportunity to present her evidence, she would have proven
On 5 December 2001, the RTC, citing the absence of petitioner and her counsel on said hearing date that (1) respondents’ Exhibit A (mortgage of land to the spouses Relova) had been novated by
despite due notice, granted an oral Motion by the respondents by issuing an Order allowing the ex parte respondent’s Exhibit B (sale of the mortgage land to the spouses Relova); (2) respondents’ Exhibit C
presentation of evidence by respondents.2 (mortgage of land to the spouses Perez) had been novated by respondent’s Exhibit B (sale of the
mortgage land to the spouses Perez); and (3) having executed Exhibits "B" and "D," Monzon no longer
On 1 April 2002, the RTC rendered a Decision in favor of respondents. The pertinent portions of the had any obligation towards respondents.
Decision are as follows:
That [petitioner] Teresita Monzon owes [herein respondents] certain sums of money is indisputable. The Order by the trial court which allowed respondents to present their evidence ex parte states:
Even [Monzon] have admitted to this in her Answer. [Respondents] therefore are given every right to In view of the absence of [Monzon] as well as her counsel despite due notice, as prayed for by counsel
get back and collect whatever amount they gave [Monzon] together with the stipulated rate of interest. for by [respondents herein], let the reception of [respondent’s] evidence in this case be held ex-parte
Likewise, it has been established that [petitioner] Teresita Monzon has the amount of P1,602,393.65 in before a commissioner who is the clerk of court of this Court, with orders upon her to submit her report
the possession of the Clerk of Court, Atty. Ana Liza M. Luna. This amount, as is heretofore stated, immediately upon completion thereof.5
represented the balance of the foreclosure sale of [Monzon’s] properties.
By way of this petition, [respondents] would want to get said amount so that the same can be applied It can be seen that despite the fact that Monzon was not declared in default by the RTC, the RTC
as full payment of [petitioner’s] obligation. That the amount should be divided between the nevertheless applied the effects of a default order upon petitioner under Section 3, Rule 9 of the Rules of
[respondents] in the amount they have agreed between themselves; [respondent] spouses Relova to Court:
receive the amount of P400.00.00, while the spouses Perez shall get the rest. SEC. 3. Default; declaration of.—Ifthe defending party fails to answer within the time allowed therefor,
WHEREFORE, judgment is hereby rendered ordering the x x x Clerk of Court, Atty. Ana Liza M. Luna, to the court shall, upon motion of the claiming party with notice to the defending party, and proof of such
deliver unto [herein respondents] the amount of P1,602,393.65 plus whatever interest she may failure, declare the defending party in default. Thereupon, the court shall proceed to render judgment
received if and when the said amount has been deposited in any banking institution.3 granting the claimant such relief as his pleading may warrant, unless the court in its discretion requires
the claimant to submit evidence. Such reception of evidence may be delegated to the clerk of court.
The Decision also mentioned that the Order allowing the ex parte presentation of evidence by (a) Effect of order of default.—Aparty in default shall be entitled to notice of subsequent proceedings
respondents was due to the continuous and incessant absences of petitioner and counsel.4 but not to take part in the trial.

On 25 April 2002, Monzon filed a Notice of Appeal, which was approved by the trial court. Monzon claims In his book on remedial law, former Justice Florenz D. Regalado writes that failure to appear in hearings
that the RTC gravely erred in rendering its Decision immediately after respondents presented their is not a ground for the declaration of a defendant in default:
evidence ex parte without giving her a chance to present her evidence, thereby violating her right to due
process of law. Failure to file a responsive pleading within the reglementary period, and not failure to appear at the
hearing, is the sole ground for an order of default (Rosario, et al. vs. Alonzo, et al., L-17320, June 29,
On 14 June 2002, Addio Properties, Inc. filed before the trial court a Motion for Intervention, which was 1963), except the failure to appear at a pre-trial conference wherein the effects of a default on the part
granted by the same court on 12 July 2002. of the defendant are followed, that is, the plaintiff shall be allowed to present evidence ex parte and a
judgment based thereon may be rendered against the defendant (Section 5, Rule 18).6 Also, a default
On 27 September 2005, the Court of Appeals rendered the assailed Decision dismissing the appeal. judgment may be rendered, even if the defendant had filed his answer, under the circumstance in Sec.
According to the Court of Appeals, Monzon showed tepid interest in having the case resolved with 3(c), Rule 29.7
dispatch. She, thus, cannot now complain that she was denied due process when she was given ample
opportunity to defend and assert her interests in the case. The Court of Appeals reminded Monzon that Hence, according to Justice Regalado, the effects of default are followed only in three instances: (1)
the essence of due process is reasonable opportunity to be heard and submit evidence in support of when there is an actual default for failure to file a responsive pleading; (2) failure to appear in the pre-

41
trial conference; and (3) refusal to comply with modes of discovery under the circumstance in Sec. 3(c), However, Rule 68 governs the judicial foreclosure of mortgages. Extra-judicial foreclosure of mortgages,
Rule 29. which was what transpired in the case at bar, is governed by Act No. 3135, 11 as amended by Act No.
4118,12 Section 6 of Republic Act No. 7353, Section 18 of Republic Act No. 7906, and Section 47 of
In Philippine National Bank v. De Leon,8 we held: Republic Act No. 8791. A.M. No. 99-10-05-0, issued on 14 December 1999, provides for the procedure to
We have in the past admonished trial judges against issuing precipitate orders of default as these have be observed in the conduct of an extrajudicial foreclosure sale. Thus, we clarified the different types of
the effect of denying a litigant the chance to be heard, and increase the burden of needless litigations in sales in Supena v. Dela Rosa, 13 to wit:
the appellate courts where time is needed for more important or complicated cases. While there are Any judge, worthy of the robe he dons, or any lawyer, for that matter, worth his salt, ought to know
instances when a party may be properly defaulted, these should be the exception rather than the rule, that different laws apply to different kinds of sales under our jurisdiction. We have three different types
and should be allowed only in clear cases of obstinate refusal or inordinate neglect to comply with the of sales, namely: an ordinary execution sale, a judicial foreclosure sale, and an extrajudicial foreclosure
orders of the court (Leyte vs. Cusi, Jr., 152 SCRA 496; Tropical Homes, Inc. vs. Hon. Villaluz, et al., sale. An ordinary execution sale is governed by the pertinent provisions of Rule 39 of the Rules of Court
G.R. No. L-40628, February 24, 1989). on Execution, Satisfaction and Effect of Judgments. Rule 68 of the Rules, captioned Foreclosure of
Mortgage, governs judicial foreclosure sales. On the other hand, Act No. 3135, as amended by Act No.
4118, otherwise known as "An Act to Regulate the Sale of Property under Special Powers Inserted in or
It is even worse when the court issues an order not denominated as an order of default, but provides for Annexed to Real Estate Mortgages," applies in cases of extrajudicial foreclosure sales of real estate
the application of effects of default. Such amounts to the circumvention of the rigid requirements of a mortgages.
default order, to wit: (1) the court must have validly acquired jurisdiction over the person of the
defendant either by service of summons or voluntary appearance; (2) the defendant failed to file his
answer within the time allowed therefor; and (3) there must be a motion to declare the defendant in Unlike Rule 68, which governs judicial foreclosure sales, neither Act No. 3135 as amended, nor A.M. No.
default with notice to the latter. 9 In the case at bar, petitioner had not failed to file her answer. Neither 99-10-05-0 grants to junior encumbrancers the right to receive the balance of the purchase price. The
was notice sent to petitioner that she would be defaulted, or that the effects of default shall be imposed only right given to second mortgagees in said issuances is the right to redeem the foreclosed property
upon her. "Mere non-appearance of defendants at an ordinary hearing and to adduce evidence does not pursuant to Section 6 of Act No. 3135, as amended by Act No. 4118, which provides:
constitute default, when they have already filed their answer to the complaint within the reglementary Sec. 6. Redemption. In all cases in which an extrajudicial sale is made under the special power
period. It is error to default a defendant after the answer had already been filed. It should be borne in hereinbefore referred to, the debtor, his successors in interest or any judicial creditor or judgment
mind that the policy of the law is to have every litigant’s case tried on the merits as much as possible; it creditor of said debtor, or any person having a lien on the property subsequent to the mortgage or deed
is for this reason that judgments by default are frowned upon."10 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,14 inclusive, of the Code of Civil
Does this mean that defendants can get away with failing to attend hearings despite due notice? No, it Procedure, in so far as these are not inconsistent with this Act.
will not. We agree with petitioner that such failure to attend, when committed during hearing dates for Even if, for the sake of argument, Rule 68 is to be applied to extrajudicial foreclosure of mortgages,
the presentation of the complainant’s evidence, would amount to the waiver of such defendant’s right to such right can only be given to second mortgagees who are made parties to the (judicial) foreclosure.
object to the evidence presented during such hearing, and to cross-examine the witnesses presented While a second mortgagee is a proper and in a sense even a necessary party to a proceeding to
therein. However, it would not amount to a waiver of the defendant’s right to present evidence during foreclose a first mortgage on real property, he is not an indispensable party, because a valid decree
the trial dates scheduled for the reception of evidence for the defense. It would be an entirely different may be made, as between the mortgagor and the first mortgagee, without regard to the second
issue if the failure to attend of the defendant was on a hearing date set for the presentation of the mortgage; but the consequence of a failure to make the second mortgagee a party to the proceeding is
evidence of the defense, but such did not occur in the case at bar. that the lien of the second mortgagee on the equity of redemption is not affected by the decree of
foreclosure.15
In view of the foregoing, we are, therefore, inclined to remand the case to the trial court for reception of
evidence for the defense. Before we do so, however, we need to point out that the trial court had A cause of action is the act or omission by which a party violates the right of another.16 A cause of action
committed another error which we should address to put the remand in its proper perspective. We refer exists if the following elements are present: (1) a right in favor of the plaintiff by whatever means and
to Monzon’s argument as early as the Answer stage that respondents’ Petition for Injunction had failed to under whatever law it arises or is created; (2) an obligation on the part of the named defendant to
state a cause of action. respect or not to violate such right; and (3) an act or omission on the part of such defendant violative of
the right of plaintiff or constituting a breach of the obligation of defendant to the plaintiff for which the
Section 4, Rule 68 of the Rules of Court, which is the basis of respondent’s alleged cause of action latter may maintain an action for recovery of damages.17 In view of the foregoing discussions, we find
entitling them to the residue of the amount paid in the foreclosure sale, provides as follows: that respondents do not have a cause of action against Atty. Ana Liza Luna for the delivery of the subject
SEC. 4. Disposition of proceeds of sale.—Theamount realized from the foreclosure sale of the amounts on the basis of Section 4, Rule 68 of the Rules of Court, for the reason that the foregoing Rule
mortgaged property shall, after deducting the costs of the sale, be paid to the person foreclosing the does not apply to extrajudicial foreclosure of mortgages.
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, In Katon v. Palanca, Jr.,18 we held that where prescription, lack of jurisdiction or failure to state a cause
or if there be no such encumbrancers or there be a balance or residue after payment to them, then to of action clearly appears from the complaint filed with the trial court, the action may be dismissed motu
the mortgagor or his duly authorized agent, or to the person entitled to it. proprio, even if the case has been elevated for review on different grounds. However, while the case
should indeed be dismissed insofar as Atty. Luna is concerned, the same is not necessarily true with

42
respect to Monzon. Other than respondents’ prayer that the amount due to respondents be delivered by
Atty. Luna to them, they also pray for a judgment declaring Monzon liable for such amounts. Said prayer,
as argued by Monzon herself, may constitute a cause of action for collection of sum of money against
Monzon.

The rule is now settled that a mortgage creditor may elect to waive his security and bring, instead, an
ordinary action to recover the indebtedness with the right to execute a judgment thereon on all the
properties of the debtor including the subject matter of the mortgage, subject to the qualification that if
he fails in the remedy elected by him, he cannot pursue further the remedy he has waived.19

However, due to the fact that construing respondents’ Petition for Injunction to be one for a collection of
sum of money would entail a waiver by the respondents of the mortgage executed over the subject
properties, we should proceed with caution before making such construction. We, therefore, resolve that
upon the remand of this case to the trial court, respondents should be ordered to manifest whether the
Petition for Injunction should be treated as a complaint for the collection of a sum of money.

If respondents answer in the affirmative, then the case shall proceed with the presentation of the
evidence for the defense. If Monzon would be successful in proving her defense of dacion en pago, there
would, in effect, be a double sale of the mortgaged properties: the same properties were sold to both G.R. No. 133366           August 5, 1999
respondents and to herein intervenor Addio Properties, Inc. If, pursuant to the rules on double sales,
respondents are entitled to the properties, their remedy is to file the proper action to recover possession.
If, pursuant to said rules, Addio Properties, Inc. is entitled to the properties, respondents’ remedy is to UNIONBANK OF THE PHILIPPINES, petitioner,
file an action for damages against Monzon. vs.
THE COURT OF APPEALS and FERMINA S. DARIO and REYNALDO S. DARIO, respondents.

If respondents answer in the negative, the case shall be dismissed, without prejudice to the exercise of
respondents’ rights as mortgage creditors. If respondents’ mortgage contract was executed before the Unionbank of the Philippines (hereafter UNIONBANK) appeals, by way of certiorari, the Decision1 of the Court of
execution of the mortgage contract with Addio Properties, Inc., respondents would be the first Appeals (CA) of 26 June 1997 and its Resolution of 7 April 19982. The CA nullified the Regional Trial Court's (RTC)
mortgagors. Pursuant to Article 212620 of the Civil Code, they would be entitled to foreclose the property Order3 of 7 August 1995 denying private respondents' application for preliminary injunction as UNIONBANK's
as against any subsequent possessor thereof. If respondents’ mortgage contract was executed after the consolidation of ownership divested private respondents of their property without due process of law. It also ordered
execution of the mortgage contract with Addio Properties, Inc., respondents would be the second the register of deeds to cancel UNIONBANK's title and the trial court to hear private respondents prayer for injunctive
mortgagors. As such, they are entitled to a right of redemption pursuant to Section 6 of Act No. 3135, as relief.1âwphi1.nêt
amended by Act No. 4118.
This case stemmed from a real estate mortgage executed on 17 December 1991 by spouses Leopoldo and Jessica
WHEREFORE, the Decision of the Court of Appeals dated 27 September 2005 and its Resolution dated 7 Dario (hereafter mortgagors) in favor of UNIONBANK to secure a P3 million loan, including interest and other
March 2006 are REVERSED and SET ASIDE. The Petition for Injunction in Civil Case No. TG-2069 is charges. The mortgage covered a Quezon City property with Transfer Certificate of Title (TCT) No. 41828 in Leopoldo
hereby ordered DISMISSED insofar as Atty. Ana Liza Luna is concerned. The Petition for Injunction in Dario's name and was annotated on the title on 18 December 1991. For non-payment of the principal obligation,
Civil Case No. TG-2069, insofar as petitioner Teresita Monzon is concerned, is ordered REMANDED to the UNIONBANK extrajudicially foreclosed the property mortgaged on 12 August 1993 and sold the same at public
Regional Trial Court of Tagaytay City for further proceedings. Upon such remand, the Regional Trial Court auction, with itself posting the highest bid.
of Tagaytay City shall issue an Order to respondents, the spouses James and Maria Rosa Nieves Relova
and the spouses Bienvenido and Eufracia Perez, to manifest whether the Petition for Injunction should be On 4 October 1994, one week before the one-year redemption period expired, private respondents filed a complaint
treated as a complaint for the collection of a sum of money. with the RTC of Quezon City against the mortgagors, UNIONBANK, the Register of Deeds and the City Sheriff of
Quezon City. Docketed as Civil Case No. Q-94-21830, the complaint was for annulment of sale and real estate
If respondents answer in the affirmative, the Regional Trial Court shall set the case for hearing for the mortgage reconveyance and prayer for restraining notice of lis pendens  was annotated on the title.
presentation of the evidence for the defense. If respondents answer in the negative, the case shall be
dismissed, without prejudice to the exercise of respondents’ rights as mortgage creditors. No costs. On 10 October 1994, RTC, Branch 81, through Presiding Judge (later CA Justice) Celia Lipana-Reyes, issued a
temporary restraining order (TRO) enjoining the redemption of property within the statutory period and its
consolidation under UNIONBANK's name. At a hearing four days later, UNIONBANK's counsel orally moved for
dismissal of the complaint alleging that a certification of non-forum shopping-is prescribed by SC-Circular 4-944 was

43
not attached thereto. Judge Lipana-Reyes settled the motion in favor of UNIONBANK and dismissed5 the complaint on The annulment case was re-raffled to Branch 227 under Presiding Judge Vicente Q. Roxas upon the creation of
17 October 1994. new salas. Judge Roxas, on 25 March 1996, denied the motion to reconsider the 19 August 1995 Order but
suggested that private respondents amend their application from prohibitory to mandatory injunction.
Aggrieved, private respondents filed a motion for reconsideration6 of the dismissal on 20 October 1994 and prayed
that they be permitted to amend their verified complaint to comply with the requisites of Circular 4-94. Upon the As private respondents were unable to amend their application, the RTC denied the motion for reconsideration and
appointment of Judge Lipana-Reyes to the CA, pairing Judge Agustin S. Dizon took over the case and on 15 their motion for indirect contempt, "in the interest of free speech and tolerance" on 9 July 1996. Asserting grave
November 1994 allowed private respondents to incorporate the mandatory formal requirements of SC Administrative abuse of discretion, private respondents brought the denial of their motion for reconsideration with the Court of
Circular 4-94 to their complaint. Appeals on 6 September 1996.

In the meantime, without notifying private respondents, UNIONBANK consolidated its title over the foreclosed After considering the arguments presented by the parties, the CA ruled that despite its knowledge that the ownership
property on 24 October 1994, TCT No. 41828 was cancelled and TCT No. 120929 in UNIONBANK's name was issued of the property was being questioned, UNIONBANK took advantage of private respondents' procedural error by
in its stead. consolidating title to the property, which "smack[ed] of bad faith" and "evince[d] a reprobate disposition of the part
of its counsel to advance his client's cause by fair means or foul." As a result thereof the transfer of title was vitiated
Private respondents filed an amended complaint 7 on 9 December 1994, alleging that they, not the mortgagors, are by non-adherence to procedural due process.8
the true owners of the property mortgaged and insisting on the invalidity of both the mortgage and its subsequent
extrajudicial foreclosure. They claimed that the original title, TCT No. 61571, was entrusted to a certain Atty. On 26 June 1997, CA nullified the consolidation of ownership, ordered the Register of Deeds to cancel the certificate
Reynaldo Singson preparatory to its administrative reconstitution after a fire gutted the Quezon City Hall building. of title in UNIONBANK's name and to reinstate TCT No. 41828 with the notice of lis pendens  annotated at the back.
Mortgagor Leopoldo, private respondent Fermina's son, obtained the property from Atty. Singson, had the title The CA also set aside the portion of the assailed RTC Orders that declared private respondents' prayer for writ of
reconstituted under his name without private respondents' knowledge, executed an ante-dated deed of sale in his preliminary injunction as moot and academic. UNIONBANK's motion for reconsideration of the above-mentioned
favor and mortgaged the property to UNIONBANK. decision was likewise rejected for lack of merit on 7 April 1998.

On 19 December 1994, Judge Ignacio M. Capulong to whom this case was assigned admitted the aforementioned Hence, UNIONBANK came to this Court claiming to be a mortgagee in good faith and for value with a right to
amended complaint and set the application for writ of preliminary injunction for hearing. After UNIONBANK's motion consolidate ownership over the foreclosed property with the redemption period having expired and there having been
for reconsideration of said Order was denied on 17 January 1995, it filed a petition for certiorari with the CA no redemptioners. UNIONBANK contends that the TRO which provisionally enjoined the tolling of the redemption
questioning the admission of the amended complaint. The CA upheld Judge Capulong's order admitting the amended period was automatically dissolved upon dismissal of the complaint on 17 October 1994. Conformably, consolidation
complaint on 24 April 1995, UNIONBANK thereafter elevated its cause to this Court. of title in its name and the issuance of TCT No. 120929 rendered further proceedings on the application for injunction
academic. Moreover, the alleged fraudulent mortgage was facilitated through private respondents' negligence so they
Meanwhile, on 9 February 1995 UNIONBANK filed its answer ad cautelam  asserting its status as an innocent must bear the loss. It also contends that since private respondents had filed several pleadings, due process, being an
mortgagee for value whose right or lien upon the property mortgaged must be respected even if, the mortgagor opportunity to be heard either through pleadings or oral arguments, was observed.
obtained his title through fraud. It also averred that the action had become "moot and academic by the consolidation
of the foreclosed property on 24 October 1994" in its name, resulting to the issuance of TCT No. 120929 by the Private respondents maintain that UNIONBANK's consolidation of the title in its name was in bad faith, vitiated a
Register of Deeds of Quezon City. In reaction to UNIONBANK's revelation, private respondents moved to declare standing court order, is against the law, thus void ab initio. The application for preliminary injunction was not
UNIONBANK's counsel in indirect contempt attacking his disobedience to the TRO. rendered moot and academic by consolidation, which took place during the lifetime of the TRO, and did not follow the
proper legal procedure due to the surreptitious manner it was accomplished. By treating the application for
On 19 May 1995, private respondents moved to declare the other defendants in default for their non-filing of preliminary injunction as moot and academic and denying the motion for indirect contempt without hearing, the RTC
responsive pleadings within the mandatory period and to set the application for preliminary injunction and indirect order ran afoul with the requirements of due process.
contempt for pre-trial and trial.
Two main issues can be gleaned from the posturing and claims of the parties, to wit, was the consolidation of title in
On 14 June 1995 the second division of this Court denied the petition for certiorari, which it considered as a petition UNIONBANK's name proper, and was the dismissal of the application for preliminary prohibitory injunction valid.
for review under Rule 45, "for failure to show that the CA had committed any reversible error" in judgment.
The issues must be answered in the affirmative.
In its 19 August 1995 Order, the RTC held the mortgagors and the City Sheriff of Quezon City in default and
sustained UNIONBANK's contention that the act sought to be enjoined had been enforced, negating the need of UNIONBANK's consolidation of title over the property on 24 October 1994 was proper, though precipitate. Contrary to
hearing the application for preliminary injunction. Private respondents filed a lengthy motion for reconsideration to private respondents' allegation UNIONBANK violated no standing court order. The only bar to consolidation was the
this Order. temporary restraining order issued by Justice Lipana-Reyes on 10 October 1994 which effectively halted the tolling of
the redemption period 7 days short of its expiration. When private respondents' original complaint was dismissed on
17 October 1994 for failure to append a certification of non-forum shopping, the TRO, as an ancillary order that
cannot stand independent of the main proceeding, became  functus officio. Thus the tolling of the 12-month

44
redemption period, interrupted by the filing of the complaint and the TRO, recommenced and eventually expired 7 In the case at bar, the consolidation of ownership over the mortgaged property in favor of UNIONBANK and the
days thereafter or on 24 October 1994, the date of the disputed consolidation. issuance of a new title in its name during the pendency of an action for annulment and reconveyance will not cause
irreparable injury to private respondents who are plaintiffs in the said preliminary injunction. This is because .as
The motion for reconsideration and to amend complaint filed by private respondent on 20 October 1994 was of no purchaser at a public auction, UNIONBANK is only substituted to and acquires the right, title, interest and claim of
moment, this Court recognizing that "a dismissal, discontinuance or non-suit of an action in which a restraining order the judgment debtors or mortgagors to the property at the time of levy. 21 Perforce, the judgment in the main action
or temporary injunction has been granted operates as a dissolution of the restraining order or temporary for reconveyance will not be rendered ineffectual by the consolidation of ownership and the issuance of title in the
injunction,"9 regardless of whether the period for filing a motion for reconsideration of the order dismissing the case name of UNIONBANK.
or appeal therefrom has expired.10 The rationale therefor is that even in cases where an appeal is taken from a
judgment dismissing an action on the merits, the appeal does not suspend the judgment, hence the general rule More importantly, with the main action for reconveyance pending before the RTC, the notice of lis pendens, which
applies that a temporary injunction terminates automatically on the dismissal of the action.11 despite consolidation remains annotated on UNIONBANK's transfer certificate of title subject to the outcome of the
litigation, sufficiently protects private respondents interest over the property. A transferee  pendente lite  stands
We disagree with the appellate court's observation that consolidation deprived private respondents of their property exactly in the shoes of the transferor and is bound by any judgment or decree which may be rendered for or against
without due process. It is settled that the buyer in a foreclosure sale becomes the absolute owner of the property the transferor. Once a notice of lis pendens  has been duly registered, any cancellation or issuance of the title of the
purchased if it is not redeemed during the period of one year after the registration of the sale. 12 Consolidation took land involved as well as any subsequent transaction affecting the same, would have to be subject to the outcome of
place as a matter of right since there was no redemption of the foreclosed property and the TRO expired upon the litigation. In other words, upon the termination of the litigation there can be no risk of losing the property or any
dismissal of the complaint. UNIONBANK need not have informed private respondent that it was consolidaint its title part thereof as a result of any conveyance of the land or any encumbrance that may be made thereon posterior to
over the property, upon the expiration of the redemption period, without the judgment debtor having made use of the filing of the notice of lis pendens.22
his right of redemption, the ownership of the property sold becomes consolidated in the purchaser. 13 Notice to the
mortgagors and with more reason, to private respondents who are not even parties to the mortgage contract nor to Finally, as to the issue of who between private respondents and UNIONBANK is negligent and hence must bear the
the extra judicial sale is not necessary. loss, the same is not the proper subject of the present petition and can only be resolved by the trial court after the
trial on the merit of the main case.
In real estate mortgage, when the principal obligation is not paid when due, the mortgage has the right to foreclose
the mortgage and to have the property seized and sold with a view to applying the proceeds to the payment of the WHEREFORE, the assailed Decision of the Court of Appeals of 26 June 1997 nullifying the consolidation of ownership and ordering the
principal obligation.14 Foreclosure may be effected either judicially or extrajudicially. Register of Deeds of Quezon City to cancel TCT No. 120929 and reinstate TCT No. 41828 is hereby REVERSED and SET ASIDE. The
order of the trial court dated 7 August 1999, declaring UNIONBANK's prayer for writ of preliminary injunction moot and academic, is
hereby REINSTATED. Let this case be remanded to the Regional Trial Court for trial on the merits.
In a public bidding during extra-judicial foreclosure, the creditor —mortgagee, trustee, or other person authorized to
act for the creditor may participate and purchase the mortgaged property as any other bidder. Thereafter the
G.R. No. 148448             August 17, 2004
mortgagor has one year within which to redeem the property from and after registration of sale with the Register of
Deeds.15 In case of non-redemption, the purchaser at foreclosure sale shall file with the Register of Deeds, either a
final deed of sale executed by the person authorized by virtue of the power of attorney embodied in the deed or RUSTICO A. ARDIENTE and ASUNCION PALOMARDIENTE, petitioners,
mortgage, or his sworn statement attesting to the fact of non-redemption; whereupon, the Register of Deeds Shall vs.
issue a new certificate of title in favor of the purchaser after the owner's duplicate of the certificate has been PROVINCIAL SHERIFF, REGISTER OF DEEDS OF QUEZON and PENINSULA DEVELOPMENT
previously delivered and canceled.16 Thus, upon failure to redeem foreclosed realty, consolidation of title becomes a BANK, respondents.
matter of right on the part of the auction buyer, 17 and the issuance of a certificate of title in favor of the purchaser
becomes ministerial upon the Register of Deeds. In mid-November 1979, the spouses Rustico Ardiente and Asuncion Paloma, together with their son Angel P. Ardiente
and the latter’s wife Gliceria Ardiente, obtained a loan in the amount of P100,000.00 from the Peninsula Development
There is, moreover, nothing erroneous with the denial of private respondents' application for preliminary prohibitory Bank (the bank) at its main office at Lucena City, to be amortized in six years, on account of which they executed a
injunction. The acts complained of have already been consummated. It is impossible to restrain the performance of November 15, 1979 Promissory Note1 in the same amount.
consummated acts through the issuance of prohibitory injunction. When the act sought to be prevented had long
been consummated, the remedy of injunction could no longer be entertained,18 hearing the application for To secure the payment of the loan, the Ardientes executed in favor of the bank a Real Estate Mortgage 2 on November
preliminary injunction would just be an exercise in futility. 14, 1979 over a parcel of land situated at Mabutag, Cawa, Buenavista, Quezon and covered by Transfer Certificate of
Title (TCT) No. 29478, and three (3) parcels of land situated at Cadlit, Guinayangan, Quezon and covered by Original
In addition, to be entitled to the injunctive writ, movant must show that there exists a right to be protected which is Certificate of Title (OCT) No. 0-5961.
directly threatened by an act sought to be enjoined. Furthermore, there must be a showing that the invasion of the
right is material and substantial and that there is an urgent and paramount necessity for the writ to prevent a serious Out of the proceeds of the loan, the Ardientes purchased a mini bus costing P81,875.00.
damage.19 The injunctive remedy prevents a threatened or continuous irremediable injury to some of the parties
before their claim can be thoroughly investigated and advisedly adjudicated; it is resorted to only when there is a
After the bus was in operation for several months, it met an accident in August 1980 as result of which it sustained
pressing necessity to avoid injurious consequences which cannot be remedied under any standard compensation.20
heavy damages and rendered the Ardientes unable to meet their obligation to the bank. As the Ardientes were later

45
granted by the bank an additional loan of P46,000 for which they executed an October 29, 1981 Promissory annulled; by reason of the unlawful foreclosure of the real estate mortgage, they suffered damages; and to protect
Note,3 the Real Estate Mortgage was amended. their interests, they filed a formal request with the Register of Deeds to cause a notice of lis pendens.

Demands for the payment of their obligation to the bank notwithstanding, the Ardientes failed to settle the same. In compliance with the directive of Branch 61 of the Gumaca RTC, the parties submitted their respective memoranda.

The bank thus extra-judicially foreclosed the mortgage and the parcels of land covered thereby were sold at public In their memorandum, the defendants bank et al. proffered the following pertinent argument on the Ardiente
auction to the bank which was the highest bidder. spouses’ claim that they were not previously notified of the foreclosure:
[I]t is maintained that there was notice, coupled with a publication of Notice of Public Auction Sale in a newspaper
The bank later notified the Ardientes by letter of February 24, 1984 4 that they had one (1) year from November 11, of general circulations (sic) supported by publishers’ affidavit attached to the record in the Office of the
1983 or up to November 11, 1984 to redeem the foreclosed mortgage. Provincial Sheriff of Quezon at Calauag, Quezon. Personal notice was sent to the plaintiffs. However, said
requirements in the extra-judicial foreclosure is dispensed with, in accordance with the decision of the Supreme
Court in the case of ---
Two days before the period to redeem the foreclosed mortgage expired or on November 9, 1984, the spouses Rustico BONNEVIE V. COURT OF APPEALS, 125 SCRA 122 (1983)
and Suncion Ardiente filed before the Regional Trial Court (RTC) of Quezon at Gumaca a complaint, denominated as In extra-judicial foreclosure, Act No. 3135 personal notice on the mortgagor is not necessary. Section 3
Petition,5 against the bank, the provincial Sheriff of Quezon, and the Register of deeds of Quezon, for Annulment of thereof reads:
Auction Sale with Preliminary Injunction and Damages, anchored to two grounds as reflected in paragraph 16 of the Sec. 3 – Notice shall be given by posting notices of the sale for not less than twenty (20) days in
Complaint: at least three (3) public places of the municipality or city where the property is situated, and if
16. On two (2) legal grounds, therefore, namely, (a) that it was the defendant, not herein petitioners, who had such property is worth more than P400.00, such notice shall also be published once a week for at
violated the Real Estate Mortgage and Amended Real Estate Mortgage, and (b) that the requisite of notifying least 3 consecutive weeks in a newspaper of general circulation in the municipality or city.
the mortgagors of the intended extra-judicial foreclosure sale was not duly complied with ¾ the Such phrase "once a week for at least 3 consecutive weeks", as interpreted in "BASA vs. MERCADO" (61 Phil. 632)
FORECLOSURE SALE should be annulled, which had supposedly taken place on November 11, 1983 in the Office of does not mean that the notice should be published for 3 full weeks.12 (Emphasis and underscoring supplied)
the Provincial Sheriff situated in the courthouse building, National Trial Court, Lucena City wherein the alleged
highest bidder was the defendant for the satisfaction of petitioners’ alleged indebtedness of P247,279.14;
By Decision of August 12, 1994,13 the trial court, noting the absence of documentary evidence showing strict
compliance with the statutory requirements on publication of notice of extra-judicial foreclosure of mortgage,
As the following allegation in paragraph 15 of the Complaint shows, the Ardiente spouses capitalized on the alleged declared the extra-judicial foreclosure and the sale of the mortgaged properties null and void. Thus, the trial court
lack of notice to them of the "judicial foreclosure auction sale." discoursed:

15. And, the unkindest cut of all came up when, without first having been duly notified of an intended extra-judicial Respondent Bank maintained that it filed an extra-judicial foreclosure with the Provincial Sheriff of Quezon. After
foreclosure auction sale, petitioners received a letter from the defendant, under date of February 24, 1984, due notice and publication, these properties were sold at Public Auction Sale where a corresponding Certificate of
informing them that "the one (1) year period within which to exercise their right to redeem the foreclosed Sale (Exh. 5) was issued in its name dated November 11, 1983, as the sole bidder (Memorandum for the
properties commenced to run on November 11, 1983 to November 11, 1984" (a Xerox copy of which is hereto Defendants, p.4). On page 7 of said Memorandum, it contended that there was notice, coupled with a publication of
attached as Annex "A" and made an integral part hereof).7 (Underscoring supplied) Notice of Public Auction Sale in a newspaper of general circulation supported by publisher’s affidavit attached to the
record in the Office of the Provincial Sheriff of Quezon at Calauag, Quezon. Personal notice was sent to petitioners.
On the above-quoted allegations in paragraphs 15 and 16 of the Complaint, the bank, in its Answer with (Record, pp. 358 & 361, Memorandum For the Defendants, pages 4 & 7). Despite these allegations on
Counterclaim, alleged: record, no documentary exhibits of such publication of notice of public auction sale in a newspaper of
15) Answering respondent admits the allegations contained in paragraph 15 of the petition, with the explanations general circulations supported by publisher’s affidavit were ever submitted by respondent
and qualifications, that petitioners were duly notified of the extra-judicial foreclosure and public auction sale. There Bank. Considering that petitioners are clearly attacking the validity of the public auction sale for which respondent
was sufficient notice and publication served to all concern[ed] of said public auction sale of the properties offered Bank was the sole bidder, said documentary exhibits should have been presented in court and not merely
as collaterals.8 (Underscoring supplied) alleged to be attached to the record in the Office of the Provincial Sheriff of Quezon at
(16) Answering respondent specifically denies the allegations contained in paragraph [16] of the petition. The truth Calauag, Quezon. The clear fact remains that these documents were not submitted to form part of the records of
of the matter is that the petitioners have violated the terms and conditions of Real Estate Mortgage, Amended Real this case. No such proof of publication exists in the records. In the case of Tambunting vs. Court of
Estate Mortgage and that respondent has complied with the requisites of Art. 3135 as amended in relation to the Appeals (167 SCRA 17), the Hon. Supreme Court stressed that "failure to present proof of posting and publication
application [for] extra-judicial proceeding of collaterals."9 (Underscoring supplied) rebuts the presumption of compliance with official duty". To show compliance, the published notices and certificate
of posting by the sheriff of the notice of sale on November 11, 1983 should have been presented.
To the Answer the spouses Ardiente filed a Reply and Answer to Counterclaim.10
Therefore, in the absence of convincing proof that the statutory provisions governing publication of
11 
The Complaint was later amended whereby the spouses Ardiente alleged that, among other things, the purchase notice of mortgage foreclosure sales have been strictly complied with, this Court has no other recourse
except to declare as null and void the sale in favor of judgment creditor, made by respondent Sheriff on
price of the mortgaged parcels of land was so "grossly and greatly inadequate," hence, the foreclosure sale should be
November 12, 1983, awarding the properties in question to respondent Bank, and for which, the titles in the name

46
 of petitioner-spouses were already cancelled and registered in its name. This Court also finds that petitioners are of posting and publication of the notice of sale, such may be applied only when these omissions are
entitled to and deserving the reliefs prayed for.14 (Emphasis and underscoring supplied), alleged and raised by the party in the complaint.

Accordingly, the trial court disposed as follows: The result would have been different if evidence of these issues were raised during the trial of the case with the
WHEREFORE, judgment is hereby rendered, in favor of petitioners, and against the respondents, as follows: acquiescence of the parties. Then, the rule on the amendment of the petition to conform to or authorize
(1) Declaring as null and void the extrajudicial foreclosure and sale conducted by respondent Provincial Sheriff of presentation of evidence may be applied, thus:
Quezon;
(2) Declaring as null and void all transactions/proceedings held subsequent thereto such as the execution of the Sec. 5. Amendment to conform to or authorize presentation of evidence.¾  When issues not raised in the pleadings
final deed of sale and issuance of title to and in the name of respondent Bank; are tried with the express or implied consent of the parties, they shall be treated in all respects as if they had been
(3) Ordering the respondent Register of Deeds of Quezon to re-issue a new Transfer Certificate of Title to and in raised in the pleadings. Such amendment of the pleadings as may be necessary to cause them to conform to the
the name of petitioners in lieu of the former titles which had been deemed cancelled by virtue of the issuance of evidence and to raise these issues may be made upon motion of any party at any time, even after judgments but
the titles which had been deemed cancelled by virtue of the issuance of the titles which had been issued in favor failure to amend does not affect the result of the trial of these issues. x x x
of respondent Corporation; and
(4) Ordering all respondents, jointly and severally, to pay unto herein petitioners, the sum of P15,000, for
attorney’s fees and litigation expenses of P10,000. As earlier stated however, the issue of lack of posting and publication was not even discussed nor even touched in
the testimony of plaintiff-appellee Rustico Ardiente. His testimony is limited only to his receipt of a letter from the
bank that their properties have been foreclosed and that they have one year to redeem the same. The plaintiffs-
The Defendants bank et al. thus appealed to the Court of Appeals upon the following assigned errors: appellees only imputed to the defendant-appellant Bank its omission to give them personal notice of the foreclosure
[I.] THE LOWER COURT ERRED IN FINDING AND CONCLUDING THAT THERE WAS ABSENCE OF CONVINCING sale. However, it is jurisprudentially settled that personal notice to the mortgagor in extrajudicial foreclosure
PROOF THAT THE STATUTORY PROVISIONS GOVERNING PUBLICATION OF NOTICE OF MORTGAGE FORECLOSURE proceedings is not necessary. Hence, lack of personal notice to the mortgagors is not a ground to set aside the
SALE HAVE BEEN STRICTLY COMPLIED WITH. foreclosure sale. Ergo, the trial court erred in declaring the foreclosure null and void based on a ground not raised
[II.] THE COURT A QUO ERRED IN DECLARING NULLAND VOID THE EXTRAJUDICIAL FORECLOSURE AND SALE in the pleadings nor tried before it.18 (Underscoring in the original; emphasis supplied)
CONDUCTED BY RESPONDENT PROVINCIAL SHERIFF OF QUEZON, AND ALL TRANSACTIONS/PROCEEDINGS HELD
SUBSEQUENT THERETO SUCH AS THE EXECUTION OF THE FINAL DEED OF SALE AND ISSUANCE OF TITLE TO AND
IN THE NAME OF RESPONDENT BANK. Hence, the present petition for review filed by the Ardiente spouses proferring the following:
[III.] THE LOWER COURT ERRED IN ORDERING THE RRESPONDENT REGISTER OF DEEDS OF QUEZON TO REASONS WARRANTING REVIEW
REISSUE A NEW TRANSFER CERTIFICATE OF TITLE TO AND IN THE NAME OF PETITIONERS IN LIEU OF THE I. RESPON[ENT] COURT OF APPEALS SERIOUSLY ERRED IN HOLDING THAT SINCE THE PETITIONER’S IN
FORMER TITLES WHICH HAD BEEN DEEMED CANCELLED BY VIRTUE OF THE ISSUANCE OF THE TITLES WHICH HAD THEIR PETITION AND IN THEIR AMENDED PETITION DID NOT MENTION THE ABSENCE OF THE REQUIRED
BEEN ISSUED IN FAVOR OF RESPONDENT CORPORATION. POSTING AND PUBLICATION OF THE NOTICE OF FORECLOSURE SALE, THERE IS NO NEED FOR THE
[IV.] THE TRIAL COURT ERRED IN AWARDING TO PLAINTIFFS-APPELLEES’ ATTORNEY’S FEES ABD LITIGATION DEFENDANT APPELLANT BANK TO PRESENT THE SHERIFF CERTIFICATION OF POSTING AND THE
EXPENSES.16 (Underscoring supplied) NEWSPAPER WHERE THE NOTICE WAS PUBLISHED AS WELL AS THE PUBLISHER’S AFFIDAVIT TO PROVE
THE VALIDITY OF THE FORECLOSURE SALE.
II. RESPONDENT COURT OF APPEALS SERIOUSLY ERRED IN REVERSING THE TRIAL COURT’S DECISION
By Decision of January 29, 2001,17 the Court of Appeals reversed the decision of the trial court after finding the AND DISMISSING PETITIONER’S COMPLAINT.
argument of the defendant-appellants bank et al. that the lack of required notice and publication of the extra-judicial III. RESPONDENT COURT OF APPEALS SERIOUSLY ERRED IN NOT AWARDING ATTORNEY’S FEES AND
foreclosure of mortgage was not averred in the complaint, hence, cannot be the basis of an adverse judgment. LITIGATION EXPENSES TO THE PLAINTIFFS-APPELLEES.19
Explaining its reversal of the decision, the Court of Appeals held:

The spouses Ardientes (hereinafter referred to as petitioners) argue that paragraph 15 of their Complaint and
It is axiomatic that the complaint should inform the defendant of all the material facts on which the plaintiff relies paragraph 16 of the Amended Complaint show that they were "attacking the validity of the extra-judicial sale"; that
to support his demand; it should state the theory of a cause of action which forms the bases of the plaintiff’s claim the impleading of the sheriff demonstrates that they are "questioning the validity and legality of his performance of
of liability. The office, purpose or function of the complaint is to inform the defendant clearly and definitely of the officially duty"; that the bank was sufficiently informed of their "cause of action, theory of their case and relief being
claims made against him so that he may be prepared to meet the issues at the trial. Otherwise stated, if the wrong sought" as shown by the bank’s allegations in paragraphs 15 and 16 of its Answer; and that in fact in the bank’s
or omission of the defendant is not alleged in the complaint, then the defendant would be precluded from Special and Affirmative Defenses, particularly paragraph 25 thereof which reads:
presenting evidence to refute the imputation of such wrong or present justification for the alleged omission. In this 25) That answering respondent as well as the Office of Provincial Sheriff fully compl[ied] [with] the
case, even perfunctory reading of the Petition and the Amended Petition, readily reveals the absence of any requirements of law under Act 3135 as amended, more specifically with regards to notices of the public
averment relating to the required posting and publication of the notice of foreclosure auction sale as well as the extra-judicial foreclosure application in accordance with the law.20 ,
sale. Understandably then, the defendant-appellant Bank saw no need to present the Sheriff’s Certification of an issue was tendered, the nature of which affirmative defense-answer called for the presentation of evidence, they
Posting and the newspaper where the notice was published as well as the publisher’s affidavit. Clearly, the citing Benavides v. Alabastro,21 but the bank did not present "proof of proper compliance with Act 3135, "AN ACT TO
presumption that the Provincial Sheriff of Quezon has discharged his official duty in a regular manner and that the REGULATE THE SALE OF PROPERTY UNDER SPECIAL POWERS INSERTED IN OR ANNEXED TO REAL ESTATE
defendant-appellant Bank complied with the requirements under the law will suffice. And while it may be true MORTAGES,: as to posting and publication of notices of public auction sale.
that the Supreme Court said, in the case of Tambunting v. Court of Appeals and relied upon by the trial
court, that the presumption of compliance with official duty is rebutted by the failure to present proof

47
The Court is not persuaded. In the Tambunting case cited by petitioners to support their thesis that failure to strictly comply with statutory
requirements governing publication of notice of mortgage foreclosure sales renders the sale at least voidable, the
With respect to petitioners’ paragraphs 15 and 16 allegations in their Complaint, clearly, they were questioning the therein mortgagors, in their complaint for annulment of mortgage and damages, sought to enjoin the extra-judicial
validity of the extra-judicial foreclosure of the mortgage on the basis of lack of notice to them as mortgagors. foreclosure of mortgage. During the pendency of the case, the extra-judicial foreclosure pushed thru just the same.
The mortgaged property was sold at public auction to the mortgagees, and the property was eventually sold to
the Tambunting Realty. The mortgagors thereupon filed a Supplemental Complaint impleading the realty firm, the
It is settled that personal notice to the mortgagor in extra-judicial foreclosure proceedings is not necessary, hence, provincial sheriff as the officer responsible for holding the foreclosure, and the Register of Deeds for the subsequent
not a ground to set aside the foreclosure sale.22 transfer of the property "despite alleged non-compliance with the requirements of Act 3135, Sec. 3 (as amended by
Act 4118) on posting and publication of the notice of foreclosure sale." In other words, the lack of publication was
With respect to petitioners’ argument that the bank, in paragraph 25 of its Answer, in fact put in issue its compliance raised in issue by the mortgagors in their Supplemental Complaint.
with the requirements of Act 3135, "more specifically with regards to the notices of the public auction sale as well as
the extra-judicial application in accordance with law," to thus call for the presentation of evidence, they citing In the case of Go v. Court of Appeals,26 as in the present case, despite the fact that the mortgagees pleaded as a
again Benavides,23 the same fails. defense in their Answer the "receipt of the ‘notice of the sale which was published in a newspaper of general
circulation,’’’ the issue of lack of publication of the notice of foreclosure was never raised in issue by the mortgagors.
Benavides bears on the rendition of judgment on the pleadings. It holds that where the defendant’s answer tenders
an issue, as where it does not only deny the material allegations of the complaint but also sets up certain special In disposing of the issue of lack of publication of the notice of foreclosure of mortgage which was raised for the first
and affirmative defenses, the nature of such answer calls for presentation of evidence, hence, it is error to render a time on appeal, this Court in Go held:
judgment on the pleadings thereon without such evidence. Indeed, as correctly held by the respondent Court, the issue of lack of publication of the notice of foreclosure of the
mortgage was raised only on appeal. Petitioner does not represent that he directly attacked in his complaint in Civil
No doubt, it is a well-settled rule that statutory provisions governing publication of notice of mortgage foreclosure Case No. 8920 the validity of the foreclosure because of such lack of notice. His own Statement of the Facts and of
sales must be strictly complied with, and that even slight deviations therefrom will invalidate the notice and the sale the Case in the instant petition makes no reference to such lack o notice as one, or even just as a basis for any, of
at least voidable.24 his causes of action in the complaint. He sought the cancellation of the contract of mortgage because he allegedly
never received the amounts indicated in the promissory notes. Of course, nullity of the mortgage due to absence of
Despite petitioners’ non-allegation of lack of publication of notice of foreclosure in their Complaint, the bank pleaded consideration is leagues apart form the nullity of the foreclosure of a mortgage because of non-publication of the
notice of foreclosure.
in its Answer (1) "that petitioners were duly notified of the extrajudicial foreclosure and public auction sale" and
"[t]here was sufficient notice and publication served to all concern[ed] of said public auction sale," and (2) that it and
the Office of the provincial Sheriff "fully compl[ied] with the requirements of law under Act 3135, more specifically Additionally, petitioner presented no evidence before the trial court to prove the absence of publication of the
with regard to notices of the public auction as well as the extra-judicial foreclosure in accordance with law." notice despite the fact that private respondents, in their Answer, squarely pleaded as a defense the foreclosure
sale and petitioner’s receipt of the "notice of the sale which was published in a newspaper of general
circulation." That the lack of publication of the notice of foreclosure was never raised in issue by petitioner and
Yet petitioners never refuted in their Reply and Answer to Counterclaim such defense of the bank nor presented
evidence before the trial court to disprove the same. that it is not within the issues framed by the parties in the trial court are then too obvious.

WHEREFORE, there being no reversible error in the assailed decision, the petition is hereby DISMISSED.
In fact, in its Comment on petitioners’ Formal Offer of Evidence before the trial court, the bank, passing on Exhibit
"D" – its letter to petitioners advising them that they had one year from November 11, 1993 to exercise their right of
redemption, stated that said exhibit was admitted "with the qualification as to the purpose to the effect that said G.R. No. 141974             August 9, 2004
extra-judicial foreclosure was filed in accordance with law and that all requirements of said law were complied with
and that plaintiffs were duly notified of said proceedings."25 BPI FAMILY SAVINGS BANK, INC., petitioner,
vs.
Despite the bank’s repeated claim that the statutory requirements governing extra-judicial foreclosure had been SPS. JANUARIO ANTONIO VELOSO AND NATIVIDAD VELOSO, respondents.
complied with, the bank’s plea of lack of publication of notice of foreclosure was not raised by petitioners either in the
Amended Complaint or in the Reply and Answer to Counterclaim. It was not also raised during the trial as the entire Before us is a petition for review of the decision1 dated February 14, 2000 of the Court of Appeals affirming the decision of the Regional
transcripts of the stenographic notes of the proceedings before the trial court show. Nor even in their memorandum Trial Court, Branch 94, Quezon City, 2 which upheld the validity of the extra-judicial foreclosure proceedings initiated by Family Bank
filed before the trial court, petitioners having merely assailed the lack of "personal" notification to them of any and Trust Company (Family Bank) on the mortgaged properties of respondent spouses Januario Antonio Veloso and Natividad Veloso
"intended" extrajudicial foreclosure and the "grossly and greatly inadequate" purchase price of the lands. but allowed the latter to redeem the same properties.

As the appellate court thus held, the issue of lack of publication of notice cannot be raised for the first time on On January 8, 1983, respondent spouses obtained a loan of P1,300,000 from petitioner’s predecessor-in-interest
appeal. Family Bank and Trust Company. To secure payment of the loan, respondent spouses executed in favor of the bank a
deed of mortgage over three parcels of land, with improvements, registered in their names under TCT Nos. 272227,
272228 and 272229 of the Registry of Deeds of Quezon City.

48
On February 9, 1983, respondents, for value received, executed a promissory note for P1,300,000. Subsequently, II ASSUMING FOR THE SAKE OF ARGUMENT, BUT WITHOUT ADMITTING, THAT THE HONORABLE COURT OF APPEALS DID NOT ERR
however, respondents defaulted in the monthly installments due on their loan. When efforts to update the account IN AFFIRMING THE DECISION OF THE TRIAL COURT, NEVERTHELESS IT DECIDED A QUESTION OF SUBSTANCE IN A WAY NOT IN
ACCORD WITH LAW AND THE APPLICABLE DECISIONS OF THIS HONORABLE COURT WHEN IT FIXED THE REDEMPTION PRICE TO BE
failed, Family Bank instituted extra-judicial foreclosure proceedings on the respondents’ mortgaged properties.
PAID BY RESPONDENTS TO PETITIONER AT ONLY P2,678,639.80 AND SHALL ONLY EARN 1% PER MONTH UNDER SECTION 28, RULE
39 OF THE 1997 RULES OF CIVIL PROCEDURE.
On July 1, 1985, the properties were sold at public auction with Family Bank as the highest bidder for P2,782,554.66.
The fact is that, at the time of the foreclosure sale on July 1, 1985, respondent spouses Veloso had already defaulted
On August 5, 1985, Family Bank assigned all its rights and interests in the foreclosed properties to petitioner BPI on their loan to petitioner’s predecessor-in-interest family bank. In a real estate mortgage, when the principal
Family Bank, Inc. (BPI). obligation is not paid when due, the mortgagee has the right to foreclose on the mortgage and to have the property
seized and sold, and to apply the proceeds to the obligation. 4 foreclosure is proper if the debtor is in default in the
On August 28, 1985, the sheriff’s certificate of sale was registered with the Registry of Deeds of Quezon City. payment of his obligation.5 and in this case, the validity of the extra-judicial foreclosure on July 1, 1985 was
confirmed by both the trial court and the court of appeals. We find no reason to question it.

On July 24, 1986, respondents, through counsel, wrote BPI offering to redeem the foreclosed properties
for P1,872,935. This was, however, rejected by petitioner. The sole question therefore that remains to be resolved is: did respondent spouses comply with all the requirements
for the redemption of the subject properties?

On August 27, 1986, respondents filed in the RTC of Quezon City, Branch 94, a complaint for annulment of
foreclosure, with consignation and prayer for damages. On motion of respondents, the trial court, in an order dated We answer in the negative.
August 27, 1986, allowed respondents to deposit with the clerk of court the sum of P1,500,000 representing the
redemption price. Thereafter, trial on the merits ensued. 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
Meanwhile, in Branch 76 of the Regional Trial Court of Quezon City, BPI was able to secure a writ of possession over constitutes the exercise of the right to repurchase.6
the foreclosed properties. This prompted respondents to file with the Court of Appeals a petition for certiorari with
preliminary injunction docketed as CA-G.R. SP No. 22681. On October 8, 1990, the Court of Appeals resolved to In several cases7 decided by the Court where the right to repurchase was held to have been properly exercised, there
grant respondents’ motion for preliminary mandatory injunction. was an unequivocal tender of payment for the full amount of the repurchase price. Otherwise, the offer to redeem
is ineffectual.8 Bona fide redemption necessarily implies a reasonable and valid tender of the entire repurchase price,
Eventually, however, in a decision promulgated on May 31, 1991, the Court of Appeals, in CA-G.R. SP No. 22681, otherwise the rule on the redemption period fixed by law can easily be circumvented. As explained by this Court
resolved the issue of possession in favor of BPI and accordingly lifted the preliminary mandatory injunction it had in Basbas vs. Entena:9
earlier issued, denying altogether respondents’ petition. From this decision, respondents came to this Court via a x x x the existence of the right of redemption operates to depress the market value of the land until the period
petition for review which was, however, denied in a resolution dated January 13, 1992. The resolution affirmed, in expires, and to render that period indefinite by permitting the tenant to file a suit for redemption, with either party
effect, petitioner’s right to the possession of the subject properties. unable to foresee when final judgment will terminate the action, would render nugatory the period of two years
fixed by the statute for making the redemption and virtually paralyze any efforts of the landowner to realize the
value of his land. No buyer can be expected to acquire it without any certainty as to the amount for which it may
On December 16, 1992, upon motion of respondents and despite the opposition of petitioner, Branch 94 ordered the be redeemed, so that he can recover at least his investment in case of redemption. In the meantime, the
release of P1,400,000 of the consigned amount to respondents, with the balance of P100,000 to take the place of the landowner’s needs and obligations cannot be met. It is doubtful if any such result was intended by the statute,
injunction bond to answer for whatever damages petitioner might suffer because of the issuance of the preliminary absent clear wording to that effect.
injunction (previously issued and later lifted) in favor of respondents.

Consequently, in this case, the offer by respondents on July 24, 1986 to redeem the foreclosed properties
Finally, on August 18, 1995, after almost a decade of protracted litigation, the trial court rendered a decision for P1,872,935 and the subsequent consignation in court of P1,500,000 on August 27, 1986, while made within the
declaring the validity of the extra-judicial foreclosure of the mortgaged properties of respondents but allowed the period10 of redemption, was ineffective since the amount offered and actually consigned not only did not include the
redemption of the same at a redemption price of P2,140,000. interest but was in fact also way below the P2,782,554.66 paid by the highest bidder/purchaser of the properties
during the auction sale.
BPI elevated the matter to the Court of Appeals which affirmed the trial court’s decision, with modification:
WHEREFORE, subject to the modification declaring P2,678,639.80 as the redemption price due the appellant, the In Bodiongan vs. Court of Appeals,11 we held:
decision appealed from is hereby AFFIRMED in all other respects.3 In order to effect a redemption, the judgment debtor must pay the purchaser the redemption price composed of
the following: (1) the price which the purchaser paid for the property; (2) interest of 1% per month on the
Hence, the instant petition based on the following assigned errors: purchase price; (3) the amount of any assessments or taxes which the purchaser may have paid on the property
I THE HONORABLE COURT OF APPEALS DECIDED A QUESTION OF SUBSTANCE IN A WAY NOT IN ACCORD WITH LAW AND THE after the purchase; and (4) interest of 1% per month on such assessments and taxes x x x.
APPLICABLE DECISIONS OF THIS HONORABLE COURT WHEN IT AFFIRMED THE DECISION OF THE TRIAL COURT AND ALLOWED THE
RESPONDENTS TO REDEEM THE FORECLOSED PROPERTY.
Furthermore, Article 1616 of the Civil Code of the Philippines provides:

49
 The vendor cannot avail himself of the right to repurchase without returning to the vendee the price of the sale x x sure, the Judiciary has been affected by these cases as they have unnecessarily clogged the dockets of our courts, to
x. the detriment of more important cases equally crying for attention.

It is not difficult to understand why the redemption price should either be fully offered in legal tender or else validly The petitioners, Sycamore Ventures Corporation (Sycamore) and the spouses Simon D. Paz and Leng Leng Paz,
consigned in court. Only by such means can the auction winner be assured that the offer to redeem is being made in challenge the decision1 dated May 3, 2006 and the resolution2 dated June 19, 2006 of the Court of Appeals (CA) in
good faith. CA-G.R. SP No. 88463. The CA reversed and set aside the orders 3 dated August 5, 2004 and November 22, 2004 of
the Regional Trial Court (RTC), Branch 43, San Fernando, Pampanga, in Civil Case No. 12569.
The sum of P1,400,000 consigned by respondents in Branch 94 was subsequently withdrawn by them, leaving
only P100,000 to take the place of the injunction bond. This would have been tantamount to requiring petitioner to The Factual Antecedents
accept payment by installments as there would have necessarily been an indefinite extension of the redemption
period.12 If a partial payment can bind the winning bidder or purchaser in an auction sale, by what rule can the Sixteen years ago (or sometime in 1997), Sycamore and the spouses Paz obtained from respondent Metropolitan
payment of the balance be determined? Petitioner could not be expected to entertain an offer of redemption without Bank and Trust Company (Metrobank) a credit line of ₱180,000,000.00, secured by 10 real estate mortgages 4 over
any assurance that respondents could pay the repurchase price immediately. A contrary rule would leave the buyers Sycamore’s 11 parcels of land,5 together with their improvements.6 Sycamore and the spouses Paz withdrew from the
at foreclosure sales open to harassment by expectedly angry debtors and cause unnecessary prolongation of the credit line the total amount of ₱65,694,914.26, evidenced by 13 promissory notes.7
redemption period, contrary to the policy of the law.

Because the petitioners failed to pay their loan obligations and for violations of the terms and conditions of their 13
Whether or not respondents were diligent in asserting their willingness to pay is irrelevant. Redemption within the promissory notes, Metrobank instituted extrajudicial foreclosure proceedings over the six real estate mortgages,
period allowed by law is not a matter of intent but a question of payment or valid tender of the full redemption price pursuant to Act No. 3135, as amended.8 The public auction sale was set for various dates – March 22, 2000, April 23,
within said period. 2000 and May 23, 2000 – but the sale did not take place because Sycamore and the spouses Paz asked for
postponements.
The disposition of the instant case in the trial court unnecessarily dragged for almost a decade. Now, it is on its
18th year and still respondents have not tendered the full redemption price. Nor have they consigned the full amount, Metrobank subsequently restructured Sycamore and the spouses Paz’s loan, resulting in the issuance of one
if only to prove their willingness and ability to pay. This would have evidenced their good faith. promissory note denominated as PN No. 751622 736864.92508.000.99, in lieu of the 13 promissory
notes9 previously issued, and the execution of a single real estate mortgage covering the 12 parcels of land.10
The law granted respondents the right of redemption. But in so granting that right, the law intended that their offer
to redeem be valid and effective, accompanied by an actual tender of the redemption price. Fixing a definite term Application for Extrajudicial Foreclosure
within which the property should be redeemed is meant to avoid prolonged economic uncertainty over the ownership
of the thing sold. In the case at bar, the offer was not a legal and effective exercise of the right of redemption
contemplated by law, hence, refusal of the offer by petitioner was completely justified. Despite reminders, Sycamore and the spouses Paz still failed to settle their loan obligations, compelling Metrobank to
file a second petition for auction sale, which was set for October 25, 2002.

Finally, respondents cannot argue that the law on equity should prevail. Equity applies only in the absence of, and
never against, statutory law or judicial rules of procedure.13 On October 16, 2002, Sycamore and the spouses Paz once again asked for the postponement of the October 25,
2002 public auction sale; they asked that the sale be moved to November 26, 2002, but this time Metrobank refused
to give in.11
WHEREFORE, the appealed decision of the Court of Appeals is hereby REVERSED and SET ASIDE. The complaint
filed by respondents, the spouses Veloso, is hereby dismissed.
Civil Case No. 12569 for Annulment of Contract and Real Estate Mortgage with Temporary Restraining Order and
Injunction
G.R. No. 173183               November 18, 2013

Decision G.R. No. 173183 3

SYCAMORE VENTURES CORPORATION and SPOUSES SIMON D. PAZ AND LENG LENG PAZ,  Petitioners,
vs.
METROPOLITAN BANK AND TRUST COMPANY, Respondent. Application for Extrajudicial Foreclosure

We are once more faced by a petition filed by debtors who could not pay their indebtedness and who, at the point of Despite reminders, Sycamore and the spouses Paz still failed to settle their loan obligations, compelling Metrobank to
foreclosure, sought judicial recourse to delay the inevitable. In this case, the issue used as anchor is the valuation of file a second petition for auction sale, which was set for October 25, 2002. On October 16, 2002, Sycamore and the
the mortgage property s appraised value – an issue that hardly carries any significant consequence in extrajudicial spouses Paz once again asked for the postponement of the October 25, 2002 public auction sale; they asked that the
foreclosure proceedings. How the delay in the foreclosure has affected the parties is a matter that is not in the record sale be moved to November 26, 2002, but this time Metrobank refused to give in.11
before us, but delay, if it had been the objective sought, came as it has come in many other similar cases. To be

50
Civil Case No. 12569 for Annulment of Contract and Real Estate Mortgage with Temporary Restraining Order and of a critical question of fact – i.e., the determination of the mortgaged properties’ true valuation – which, they insist,
Injunction is an issue that needs to be resolved prior to the determination of the foreclosure’s validity.

On November 25, 2002, Sycamore and the spouses Paz filed before the RTC, Branch 43, San Fernando Pampanga, a They claim that before resolving the said issue, the RTC has to decide the following prejudicial questions, namely:
complaint for the annulment of the contract and of the real estate mortgage. They likewise asked for the issuance of (1) Whether Metrobank validly reduced the mortgaged properties’ valuation; and
a temporary restraining order (TRO). (2) Whether Metrobank can validly foreclose the mortgaged properties at a further reduced valuation.17

The petitioners disputed Metrobank’s alleged unilateral and arbitrary reduction of the mortgaged properties’ appraisal Lastly, Sycamore and the spouses Paz invoke this Court’s intervention to prevent an unfair situation where the
value from ₱1,200.00 to ₱300.00-₱400.00 per square meter. They likewise sought the maintenance of the status mortgage foreclosure, based on Metrobank’s arbitrary and unilateral reduction of the properties’ appraisal value,
quo, to enjoin Metrobank, and to prevent it from proceeding with the extrajudicial foreclosure. would deprive them of all their properties and, at the same time, leave a deficiency of ₱500,000,000.00.

On the same day, the Executive Judge issued a 72-hour TRO, directing the sheriff to cease and desist from The Issue
proceeding with the scheduled public auction.12 After summary hearing, Judge Carmelita S. Gutierrez-Fruelda, RTC,
San Fernando Pampanga, ordered the extension of the TRO to its full 20-day term.13 The core issue for our determination is whether the determination of the mortgaged properties’ appraisal value
constitutes a prejudicial question that warrants the suspension of the foreclosure proceedings. Simply put, is the
On December 17, 2002, Judge Fruelda issued a writ of preliminary injunction which Metrobank unsuccessfully appraisal value of the mortgaged properties material in the mortgage foreclosure’s validity?
resisted through a motion for reconsideration that was denied.14 Thus, Metrobank ran to the CA on a petition for
certiorari15 to question the RTC orders for grave abuse of discretion. The Court’s Ruling

The CA dismissed Metrobank’s petition for lack of merit and upheld the RTC’s issued injunction. We deny the petition for lack of merit. The CA did not err when it set aside the RTC’s order granting the motion for
appointment of independent commissioners.
Order for Appointment of Independent Commissioners
Remedies of a secured creditor
Meanwhile, the proceedings in the main case continued. At the trial, Sycamore and the spouses Paz moved for the
appointment of independent commissioners to determine the mortgaged properties’ appraisal value.16 They mainly A secured creditor may institute against the mortgage debtor either a personal action for the collection of the debt, a
alleged that Metrobank arbitrarily and unilaterally reduced the mortgaged properties’ appraisal value; hence, the real action to judicially foreclose the real estate mortgage, or an extrajudicial judicial foreclosure of the mortgage.
need for their reappraisal to determine their true value. The remedies, however, are alternative, not cumulative, and the election or use of one remedy operate as a waiver
of the others.18
In an order dated August 5, 2004, the RTC granted the petitioners’ motion, and again Metrobank was unsuccessful in
securing a reconsideration. We discussed these legal points in Bachrach Motor Co., Inc. v. Icarangal19 and ruled that:
[I]n the absence of express statutory provisions, a mortgage creditor may institute against the mortgage debtor
Metrobank thus again went to the CA on a petition for certiorari under Rule 65, imputing grave abuse of discretion on either a personal action for debt or a real action to foreclose the mortgage. In other words, he may pursue either of
the RTC for issuing the questioned order. The bank alleged that the appraisal value of the mortgaged properties is the two remedies, but not both. By such election, his cause of action can by no means be impaired, for each of the
not an issue in the proceedings because their value is already a matter of record. two remedies is complete in itself. Thus, an election to bring a personal action will leave open to him all the
properties of the debtor for attachment and execution, even including the mortgaged property itself. And, if he
On May 3, 2006, the CA this time granted Metrobank’s petition for certiorari and set aside the RTC’s orders. It found waives such personal action and pursues his remedy against the mortgaged property, an unsatisfied judgment
that the appraisal value of the mortgaged properties was not an issue since the real estate mortgage and the thereon would still give him the right to sue for a deficiency judgment, in which case, all the properties of the
promissory note already indicated with certainty the amount of the loan obligation. defendant, other than the mortgaged property, are again open to him for the satisfaction of the deficiency. In
either case, his remedy is complete, his cause of action undiminished, and any advantages attendant to the pursuit
of one or the other remedy are purely accidental and are all under his right of election.
It was Sycamore and the spouses Paz this time who filed their motion for reconsideration which the CA denied.
Significantly, the CA noted that the determination of the properties’ appraisal value has nothing to do with the
question of whether the foreclosure proceeding will proceed. In the present case, Metrobank elected the third remedy – the extrajudicial foreclosure of the real estate mortgage.

The CA’s denial gave rise to the present petition for review on certiorari. Extrajudicial foreclosure under Act No. 3135

Sycamore and the spouses Paz contend that the CA erred in setting aside the RTC’s order granting their motion for Extrajudicial foreclosure is governed by Act No. 3135, as amended by Act No. 4118.
appointment of independent commissioners. They argue that it had the effect of preventing the RTC’s determination

51
It provides in its Section 1 that: question where there is a civil action involving an issue similar or intimately related to the issue raised in a criminal
SECTION 1. When a sale is made under a special power inserted in or attached to any real-estate mortgage action, and the resolution of the issue in the civil action is determinative of the outcome of the criminal action.
hereafter made as security for the payment of money or the fulfillment of any other obligation, the provisions of
the following election shall govern as to the manner in which the sale and redemption shall be effected, whether or As so defined, we do not see how the motion for the appointment of independent commissioners can serve as a
not provision for the same is made in the power. prejudicial question. It is not a main action but a mere incident of the main proceedings; it does not involve an issue
that is intimately related to the foreclosure proceedings; and lastly, the motion’s resolution is not determinative of
In brief, Act No. 3135 recognizes the right of a creditor to foreclose a mortgage upon the mortgagor’s failure to pay the foreclosure’s outcome.
his/her obligation. In choosing this remedy, the creditor enforces his lien through the sale on foreclosure of the
mortgaged property. The proceeds of the sale will then be applied to the satisfaction of the debt. In case of a On this point alone, the petition should be denied. But even if Metrobank’s reduced appraised value were lesser than
deficiency, the mortgagee has the right to recover the deficiency resulting from the difference between the amount the mortgaged properties’ current valuation, the petition would still fail. There is no question in this case that
obtained in the sale at public auction, and the outstanding obligation at the time of the foreclosure proceedings.20 Sycamore and the spouses Paz failed to settle their loan obligations to Metrobank as they fell due. (In fact, there
were multiple or repeated failures to pay.) There is likewise no dispute on the total amount of their outstanding loan
Certain requisites must be established before a creditor can proceed to an extrajudicial foreclosure, namely: first, obligation. Sycamore and the spouses Paz also acknowledged Metrobank’s right to foreclose when they asked for the
there must have been the failure to pay the loan obtained from the mortgagee-creditor; second, the loan obligation sale’s postponement, to quote:The undersigned mortgagor(s) hereby acknowledged(s) that the publication and
must be secured by a real estate mortgage; and third, the mortgagee-creditor has the right to foreclose the real posting of the Notice of Auction Sale have been completely and regularly complied with the request(s) that
estate mortgage either judicially or extrajudicially. republication and reposting of the same be dispensed with at the discretion of the mortgagee bank and agreed that
all expenses incurred by the said mortgagee bank in connection herewith shall be chargeable to his/her/their
Act No. 3135 outlines the notice and publication requirements and the procedure for the extrajudicial foreclosure account(s) and secured by the said mortgage(s).
which constitute a condition sine qua non for its validity. Specifically, Sections 2, 3 and 4 of the law prescribe the
formalities of the extrajudicial foreclosure proceeding, which we quote: The undersigned mortgagor(s) likewise stipulate(s) that, in consideration of the mortgagee’s having acceded and
SECTION 2. Said sale cannot be made legally outside of the province in which the property sold is situated; and in agreed to this postponement, he/she/they hereby waive(s), forego(es), quitclaim(s) and set(s) over unto the said
case the place within said province in which the sale is to be made is subject to stipulation, such sale shall be made mortgagee any and all his/her/their cause or causes of action, claims or demands arising out of or necessarily
in said place or in the municipal building of the municipality in which the property or part thereof is situated. connected with the Promissory Note(s), Real Estate Mortgage Contract(s) and other credit documents mentioned in
SECTION 3. Notice shall be given by posting notices of the sale for not less than twenty days in at least three public the above entitled Petition for Foreclosure of Real Estate Mortgage.22 [emphases supplied]
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 What Sycamore and the spouses Paz only assail in the present petition is the validity of Metrobank’s appraisal of the
newspaper of general circulation in the municipality or city. mortgaged properties. Even that issue, if the quoted terms above were to be considered, appears to have been
SECTION 4. The sale shall be made at public auction, between the hours or nine in the morning and four in the waived "in consideration of the mortgagee’s having acceded and agreed to this postponement."23
afternoon; and shall be under the direction of the sheriff of the province, the justice or auxiliary justice of the peace
of the municipality in which such sale has to be made, or a notary public of said municipality, who shall be entitled
to collect a fee of five pesos each day of actual work performed, in addition to his expenses. Under these facts, how and why to petitioners would still insist on the appraisal valuation as an issue boggles the
mind and this is a puzzle that only they have a key to. But whatever may that key or answer be, it is not one that is
material to the case below or to the present petition.
Act No. 3135 does not require determination of appraised value

Determination of mortgaged properties’ appraisal value is not material to the foreclosure’s validity
All the above provisions are quoted verbatim to stress that Act No. 3135 has no requirement for the determination of
the mortgaged properties’ appraisal value. Nothing in the law likewise indicates that the mortgagee-creditor’s
appraisal value shall be the basis for the bid price. Neither is there any rule nor any guideline prescribing the We have held in a long line of cases that mere inadequacy of price per se will not invalidate a judicial sale of real
minimum amount of bid, nor that the bid should be at least equal to the properties’ current appraised value. What property. It is only when the inadequacy of the price is grossly shocking to the conscience or revolting to the mind,
the law only provides are the requirements, procedure, venue and the mortgagor’s right to redeem the property. such that a reasonable man would neither directly nor indirectly be likely to consent to it, that the sale shall be
When the law does not provide for the determination of the property’s valuation, neither should the courts so require, declared null and void. This rule, however, does not strictly apply in the case of extrajudicial foreclosure sales where
for our duty limits us to the interpretation of the law, not to its augmentation. the right of redemption is available.

Under the circumstances, we fail to see the necessity of determining the mortgaged properties’ current appraised In Bank of the Philippine Islands v. Reyes, 24 involving a similar question arising from the correctness of the
value.1âwphi1 We likewise do not discern the existence of any prejudicial question, anchored on the mortgaged mortgaged properties’ valuation, we held that the inadequacy of the price at which the mortgaged property was sold
properties’ appraised value, that would warrant the suspension of the foreclosure proceedings. does not invalidate the foreclosure sale.

For greater certainty, a prejudicial question is a prior issue whose resolution rests with another tribunal, but at the In that case, the winning bid price was ₱9,032,960.00 or merely 19% of the alleged current appraisal value of the
same time is necessary in the resolution of another issue in the same case. 21 For example, there is a prejudicial property pegged at ₱47,536,000.00. Despite the relatively sizeable discrepancy, the Court ruled that the level of the
bid price is immaterial in a forced sale because a low price is more beneficial to the mortgage debtor.

52
We quote from the relevant portion of this decision:
In the case at bar, the winning bid price of ₱9,032,960.00 is nineteen percent (19%) of the appraised value of the
property subject of the extrajudicial foreclosure sale that is pegged at ₱47,536,000.00 which amount, notably, is
only an arbitrary valuation made by the appraising officers of petitioner’s predecessor-in-interest ostensibly for loan
purposes only. Unsettled questions arise over the correctness of this valuation in light of conflicting evidence on
record. xxxx
xxx. In the case at bar, other than the mere inadequacy of the bid price at the foreclosure sale, respondent did not
allege any irregularity in the foreclosure proceedings nor did she prove that a better price could be had for her
property under the circumstances.
Thus, even if we assume that the valuation of the property at issue is correct, we still hold that the inadequacy of
the price at which it was sold at public auction does not invalidate the foreclosure sale."25 (emphasis ours)

In Hulst v. PR Builders, Inc.,26 we explained that when there is a right of redemption, the inadequacy of the price
becomes immaterial because the judgment debtor may still re-acquire the property or even sell his right to redeem
and thus recover the loss he might have suffered by reason of the "inadequate price" obtained at the execution sale.
In this case, the judgment debtor even stands to gain rather than be harmed.1âwphi1

These rulings were also applied in Rabat v. Philippine National Bank, 27 where the Court used the same reasoning and
arrived at the same conclusion:
It bears also to stress that the mode of forced sale utilized by petitioner was an extrajudicial foreclosure of real
estate mortgage which is governed by Act No. 3135, as amended.
An examination of the said law reveals nothing to the effect that there should be a minimum bid price or that the
winning bid should be equal to the appraised value of the foreclosed property or to the amount owed by the
mortgage debtor. What is clearly provided, however, is that a mortgage debtor is given the opportunity to redeem
the foreclosed property "within the term of one year from and after the date of sale." In the case at bar, other than
the mere inadequacy of the bid price at the foreclosure sale, respondent did not allege any irregularity in the
foreclosure proceedings nor did she prove that a better price could be had for her property under the
circumstances.
At any rate, we consider it notable enough that PNB’s bid price of ₱3,874,800.00 might not even be said to be
outrageously low as to be shocking to the conscience. As the CA cogently noted in the second amended
decision,20 that bid price was almost equal to both the ₱4,000,000.00 applied for by the Spouses Rabat as loan, and
to the total sum of ₱3,517,380.00 of their actual availment from PNB. [emphasis ours]

We find no reason to depart from these sound and established rulings. We also need not rule on the validity of Metrobank’s valuation.
Whether Metrobank’s reduced valuation is valid or not, or whether the valuation is outrageously lower than its current value, has
nothing to do with the foreclosure proceedings. From this perspective, we cannot but conclude that that the recourses sought in this
case have been intended solely to delay the inevitable – the foreclosure sale and the closure of the collection action -and are an abuse
of the processes of this Court. Under these circumstances the maximum allowable triple costs should be imposed on the petitioners for
this abuse in accordance with Section 3 Rule 142 of the Rules of Court to be paid by counsel for the petitioners. Let counsel also be
warned that what happened in this case is a practice that in a proper administrative proceeding may be found violative of their duties
to the Court. WHEREFORE, the petition is DENIED for lack of merit; the appealed decision of the Court of Appeals dated May 3, 2006 is
AFFIRMED. Let a copy of this Decision be furnished the Board of Governors Integrated Bar of the Philippines for its information. Triple
costs against the petitioners Sycamore Ventures Corporation and the spouses Simon D. Paz and Leng Leng Paz to be paid by their
counsel of record.

G.R. No. 154322 August 22, 2006

EMILIA FIGURACION-GERILLA, Petitioner,
vs.
CAROLINA VDA. DE FIGURACION,* ELENA FIGURACION-ANCHETA,* HILARIA A. FIGURACION, FELIPA
FIGURACION-MANUEL, QUINTIN FIGURACION and MARY FIGURACION-GINEZ, Respondents.

53
In this petition for review on certiorari,1 petitioner Emilia Figuracion-Gerilla challenges the decision2 and resolution3 of On June 26, 1997,7 the RTC8 rendered judgment nullifying Carolina’s affidavit of self-adjudication and deed of
the Court of Appeals (CA) affirming the decision of the Regional Trial Court (RTC) of Urdaneta City, Pangasinan, absolute sale of Lot 707. It also declared Lots 2299 and 705 as exclusive properties of Leandro Figuracion and
Branch 49, which dismissed her complaint for partition. The properties involved are two parcels of land which therefore part of his estate. The RTC, however, dismissed the complaint for partition, reconveyance and damages on
belonged to her late father, Leandro Figuracion. the ground that it could not grant the reliefs prayed for by petitioner without any (prior) settlement proceedings
wherein the transfer of title of the properties should first be effected.
Spouses Leandro and respondent Carolina Figuracion (now both deceased) had six children: petitioner and
respondents Elena Figuracion-Ancheta (now deceased), Hilaria Figuracion, Felipa Figuracion-Manuel, Quintin On appeal, the CA upheld the dismissal of petitioner’s action for partition for being premature. The CA reversed the
Figuracion and Mary Figuracion-Ginez. decision, however, with respect to the nullification of the self-adjudication and the deed of sale. Upholding the
validity of the affidavit of self-adjudication and deed of sale as to Carolina’s one-half pro-indiviso share, it instead
On August 23, 1955, Leandro executed a deed of quitclaim over his real properties in favor of his six children. When partitioned Lot 707. Dissatisfied, respondents elevated the CA decision to this Court in G.R. No. 151334,
he died in 1958, he left behind two parcels of land: (1) Lot 2299 of the Cadastral Survey of Urdaneta consisting of entitled Carolina vda. de Figuracion, et al. v. Emilia Figuracion-Gerilla. 9
7,547 square meters with Transfer Certificate of Title (TCT) No. 4221-P in the name of "Leandro Figuracion, married
to Carolina Adviento" and (2) Lot 705 of the Cadastral Survey of Urdaneta with an area of 2,900 sq. m. with TCT No. The issue for our consideration is whether or not there needs to be a prior settlement of Leandro’s intestate estate
4220-P also in the name of "Leandro Figuracion, married to Carolina Adviento." Leandro had inherited both lots from (that is, an accounting of the income of Lots 2299 and 705, the payment of expenses, liabilities and taxes, plus
his deceased parents,5 as evidenced by Original Certificate of Title (OCT) Nos. 16731 and 16610, respectively, issued compliance with other legal requirements, etc.) before the properties can be partitioned or distributed.
by the Register of Deeds of the Province of Pangasinan.
Respondents claim that: (1) the properties constituting Leandro’s estate cannot be partitioned before his estate is
Leandro sold a portion of Lot 2299 to Lazaro Adviento, as a result of which TCT No. 4221-P was cancelled and TCT settled and (2) there should be an accounting before anything else, considering that they (respondents) had to spend
No. 101331 was issued to "Lazaro Adviento, married to Rosenda Sagueped" as owner of the 162 sq. m. and "Leandro for the maintenance of the deceased Leandro Figuracion and his wife in their final years, which support was supposed
Figuracion, married to Carolina Adviento" as owner of 7,385 sq. m. This lot continued to be in the name of Leandro in to come from the income of the properties. Among other things, respondents apparently wanted petitioner to share
Tax Declaration No. 616 for the year 1985. in the expenses incurred for the care of their parents during the ten years she stayed in the United States, before she
could get her part of the estate while petitioner apparently wanted her gross share, without first contributing to the
What gave rise to the complaint for partition, however, was a dispute between petitioner and her sister, respondent expenses.
Mary, over the eastern half of Lot 707 of the Cadastral Survey of Urdaneta with an area of 3,164 sq. m.
In any event, there appears to be a complication with respect to the partition of Lot 705. The records refer to a case
Lot 707 belonged to Eulalio Adviento, as evidenced by OCT No. 15867 issued on February 9, 1916. When Adviento entitled Figuracion, et al. v. Alejo  currently pending in the CA. The records, however, give no clue or information
died, his two daughters, Agripina Adviento (his daughter by his first wife) and respondent Carolina (his daughter by regarding what exactly this case is all about. Whatever the issues may be, suffice it to say that partition is premature
his second wife), succeeded him to it. On November 28, 1961, Agripina executed a quitclaim in favor of petitioner when ownership of the lot is still in dispute.10
over the one-half eastern portion of Lot 707. Agripina died on July 28, 1963, single and without any issue. Before her
half-sister’s death, however, respondent Carolina adjudicated unto herself, via affidavit under Rule 74 of the Rules of Petitioner faces a different problem with respect to Lot 2299. Section 1, Rule 69 of the Rules of Court provides:
Court, the entire Lot 707 which she later sold to respondents Felipa and Hilaria. The latter two immediately had OCT
No. 15867 cancelled, on December 11, 1962. A new title, TCT No. 42244, was then issued in the names of Felipa and SECTION 1. Complaint in action for partition of real estate. — A person having the right to compel the partition of
Hilaria for Lot 707. real estate may do so as provided in this Rule, setting forth in his complaint the nature and extent of his title and an
adequate description of the real estate of which partition is demanded and joining as defendants all other persons
In February 1971, petitioner and her family went to the United States where they stayed for ten years. Returning in interested in the property.
1981,6 she built a house made of strong materials on the eastern half-portion of Lot 707. She continued paying her
share of the realty taxes thereon. The right to an inheritance is transmitted immediately to the heirs by operation of law, at the moment of death of the
decedent. There is no doubt that, as one of the heirs of Leandro Figuracion, petitioner has a legal interest in Lot
It was sometime later that this dispute erupted. Petitioner sought the extrajudicial partition of all properties held in 2299. But can she compel partition at this stage?
common by her and respondents. On May 23, 1994, petitioner filed a complaint in the RTC of Urdaneta City, Branch
49, for partition, annulment of documents, reconveyance, quieting of title and damages against respondents, There are two ways by which partition can take place under Rule 69: by agreement under Section 2 11 and through
praying, among others, for: (1) the partition of Lots 2299 and 705; (2) the nullification of the affidavit of self- commissioners when such agreement cannot be reached, under Sections 3 to 6.12
adjudication executed by respondent Carolina over Lot 707, the deed of absolute sale in favor of respondents Felipa
and Hilaria, and TCT No. 42244; (3) a declaration that petitioner was the owner of one-half of Lot 707 and (4)
damages. The case was docketed as Civil Case No. U-5826. Neither method specifies a procedure for determining expenses chargeable to the decedent’s estate. While Section 8
of Rule 69 provides that there shall be an accounting of the real property’s income (rentals and profits) in the course
of an action for partition,13 there is no provision for the accounting of expenses for which property belonging to the
On the other hand, respondents took the position that Leandro’s estate should first undergo settlement proceedings decedent’s estate may be answerable, such as funeral expenses, inheritance taxes and similar expenses enumerated
before partition among the heirs could take place. And they claimed that an accounting of expenses chargeable to under Section 1, Rule 90 of the Rules of Court.
the estate was necessary for such settlement.

54
In a situation where there remains an issue as to the expenses chargeable to the estate, partition is inappropriate. On December 6, 1972, private respondent Atty. Pacifico Pelaez filed a complaint against his granduncle, Pedro
While petitioner points out that the estate is allegedly without any debt and she and respondents are Leandro Sepulveda, Sr., with the then Court of First Instance (CFI) of Cebu, for the recovery of possession and ownership of
Figuracion’s only legal heirs, she does not dispute the finding of the CA that "certain expenses" including those his one-half (1/2) undivided share of several parcels of land covered by Tax Declaration (T.D.) Nos. 28199, 18197,
related to her father’s final illness and burial have not been properly settled. 14 Thus, the heirs (petitioner and 18193 and 28316; his undivided one-third (1/3) share in several other lots covered by T.D. Nos. 28304, 35090,
respondents) have to submit their father’s estate to settlement because the determination of these expenses cannot 18228, 28310, 26308, 28714, 28311, 28312 and 28299 (all located in Danao, Cebu); and for the partition thereof
be done in an action for partition. among the co-owners. The case was docketed as Civil Case No. SF-175.

In estate settlement proceedings, there is a proper procedure for the accounting of all expenses for which the estate The eleven (11) lots were among the twenty-five (25) parcels of land which the private respondent’s mother, Dulce
must answer. If it is any consolation at all to petitioner, the heirs or distributees of the properties may take Sepulveda, inherited from her grandmother, Dionisia Sepulveda under the Project of Partition 2 dated April 16, 1937
possession thereof even before the settlement of accounts, as long as they first file a bond conditioned on the submitted by Pedro Sepulveda, Sr. as the administrator of the former’s estate, duly approved by the then CFI of
payment of the estate’s obligations.15 Cebu in Special Proceeding No. 778-0. Under the said deed, Pedro Sepulveda, Sr. appeared to be the owner of an
undivided portion of Lot No. 28199, while his brother and Dulce’s uncle Santiago Sepulveda, was the undivided
WHEREFORE, the petition is hereby DENIED. The Court of Appeals’ decision and resolution in CA-G.R. CV No. owner of one-half (1/2) of the parcels of land covered by T.D. Nos. 18197, 18193 and 28316. Dulce and her uncles,
58290 are AFFIRMED in so far as the issue of the partition of Lots 2299 and 705 is concerned. Pedro and Santiago, were likewise indicated therein as the co-owners of the eleven other parcels of land, each with
an undivided one-third (1/3) share thereof.

But with respect to Lot 707, we make no ruling on the validity of Carolina vda. de Figuracion’s affidavit of self-
adjudication and deed of sale in favor of Felipa and Hilaria Figuracion in view of the fact that Carolina vda. de In his complaint, the private respondent alleged that his mother Dulce died intestate on March 2, 1944, and aside
Figuracion, et al. v. Emilia Figuracion-Gerilla (G.R. No. 151334) is still pending in this Division. from himself, was survived by her husband Rodolfo Pelaez and her mother Carlota Sepulveda. Dulce’s grandfather
Vicente Sepulveda died intestate on October 25, 1920,3 and Dulce was then only about four years old. According to
the private respondent, his grandmother Carlota repeatedly demanded the delivery of her mother’s share in the
eleven (11) parcels of land, but Pedro Sepulveda, Sr. who by then was the Municipal Mayor of Tudela, refused to do
so. Dulce, likewise, later demanded the delivery of her share in the eleven parcels of land, but Pedro Sepulveda, Sr.
still refused, claiming that he needed to continue to possess the property to reap the produce therefrom which he
used for the payment of the realty taxes on the subject properties. The private respondent alleged that he himself
demanded the delivery of his mother’s share in the subject properties on so many occasions, the last of which was in
1972, to no avail.

The private respondent further narrated that his granduncle executed an affidavit4 on November 28, 1961, stating
that he was the sole heir of Dionisia when she died intestate on June 5, 1921, when, in fact, the latter was survived
by her three sons, Santiago, Pedro and Vicente. Pedro Sepulveda, Sr. also executed a Deed of Absolute Sale5 on July
24, 1968 over the property covered by T.D. No. 19804 (T.D. No. 35090) in favor of the City of Danao for ₱7,492.00.
According to the private respondent, his granduncle received this amount without his (private respondent’s)
knowledge.

The private respondent prayed that, after due hearing, judgment be rendered in his favor, thus:

ON THE FIRST CAUSE OF ACTION:

1. Declaring the plaintiff the absolute owner of ONE-HALF (1/2) portion of the TWO (2) parcels of land described
in paragraph 2 of the complaint;
2. Declaring the plaintiff the absolute owner of the ONE-THIRD (1/3) portion of the NINE (9) parcels of land
G.R. No. 152195             January 31, 2005 described in paragraph 3 of the complaint;
3. Ordering the defendant to deliver to the plaintiff the latter’s ONE-THIRD (1/3) share of the SEVEN THOUSAND
PEDRO SEPULVEDA, SR., substituted by SOCORRO S. LAWAS, Administratrix of His Estate, petitioner, FOUR HUNDRED NINETY-TWO PESOS (₱7,492.00) representing the purchase price of the parcel of land described
vs. in paragraph 3(a) of the complaint with interest thereon until the amount is fully paid;
ATTY. PACIFICO S. PELAEZ, respondent. ON THE SECOND CAUSE OF ACTION:
1. Ordering the partition and segregation of the ONE-HALF (1/2) portion belonging to the plaintiff of the TWO (2)
parcels of land described in paragraph 2 of the complaint;
Before us is a petition for review on certiorari under Rule 45 of the Rules of Court, of the Decision1 of the Court of
2. Ordering the partition and segregation of the ONE-THIRD (1/3) portion belonging to the plaintiff of the
Appeals (CA) in CA-G.R. CV No. 43758 affirming the decision of the Regional Trial Court (RTC) of Danao City, Branch
remaining EIGHT (8) parcels of land described in paragraph 3 of the complaint;
25, in Civil Case No. SF-175.
COMMON TO THE FIRST AND SECOND CAUSES OF ACTION:

55
 1. Ordering the defendant to pay the plaintiff the amount of FIFTY THOUSAND PESOS (₱50,000.00) as moral WHEREFORE, premises considered, judgment is hereby rendered in favor of plaintiff and against the defendant by
damages; declaring that the plaintiff is legally and rightfully entitled to the one half (1/2) portion of the two (2) parcels of
2. Ordering the defendant to pay the plaintiff exemplary damages the amount of which is left to the discretion of land described in paragraph 2 of the Complaint and to the one third (1/3) portion of the nine (9) parcels of land
this Honorable Court; described in paragraph 3 of the complaint as co-owner thereof, and ordering the partition and segregation of the
3. Ordering the defendant to deliver to the plaintiff the latter’s share of the fruits of the ELEVEN (11) parcels of said one half (1/2) portion of the said two (2) parcels of land and of the said one third (1/3) portion of the nine (9)
land subject-matter of this complaint, the value of which will be proven during the trial; parcels of land, and in the partition thereof, the mechanics of partition outlined in Rule 69 of the Revised Rules of
4. Ordering the defendant to pay the plaintiff actual litigation expenses, the value of which will be proven during Court must be followed (Magallon vs. Montejo, 146 SCRA 282); ordering the defendant Socorro Lawas, as
the trial; administratrix of the Estate of Pedro Sepulveda, Sr., to deliver to plaintiff the latter’s one third (1/3) share of the
5. Ordering the defendant to pay attorney’s fee in the amount of TWELVE THOUSAND PESOS (P12,000.00); ₱7,492.00 representing the purchase price of the parcel of land sold to Danao City with interest of twelve [per]
6. Granting to the plaintiff such other reliefs and remedies as he may be entitled to in accordance with law and centum (12%) per annum (Reformina vs. Tomol, 139 SCRA 260) from the date of filing of the Complaint until the
equity.6 amount due to plaintiff is fully paid, to pay attorney’s fees to plaintiff’s attorney in the sum of ₱10,000.00, and to
pay the costs. The counterclaim is hereby dismissed.
In his answer to the complaint, Pedro Sepulveda, Sr. admitted having executed a deed of sale over the parcel of land
covered by T.D. No. 19804 in favor of Danao City, but averred that the latter failed to pay the purchase price The trial court ruled that the private respondent’s action for reconveyance based on constructive trust had not yet
thereof; besides, the private respondent had no right to share in the proceeds of the said sale. He likewise denied prescribed when the complaint was filed; that he was entitled to a share in the proceeds of the sale of the property to
having received any demand for the delivery of Dulce’s share of the subject properties from the latter’s mother Danao City; and that the partition of the subject property among the adjudicatees thereof was in order.
Carlota, or from the private respondent.
The petitioner appealed the decision to the CA, which rendered judgment on January 31, 2002, affirming the
During the trial, Pedro Sepulveda, Sr. died intestate. A petition for the settlement of his estate was filed on May 8, appealed decision with modification.
1975 with the RTC of Cebu, docketed as Special Proceeding No. SF-37. His daughter, petitioner Socorro Sepulveda
Lawas, was appointed administratrix of his estate in July 1976. In compliance with the decision of this Court in Lawas The petitioner now comes to the Court via a petition for review on certiorari, contending that the appellate court
v. Court of Appeals,7 docketed as G.R. No. L-45809 and promulgated on December 12, 1986, the deceased was erred as follows:
substituted by the petitioner. 1. THE COURT OF APPEALS ERRED IN THE INCORRECT APPLICATION OF ART. 494 OF THE CIVIL CODE AND IN
UPHOLDING THE REGIONAL TRIAL COURT’S FINDING THAT A TRUST RELATIONSHIP WAS CREATED BETWEEN
To prove the delivery of Dulce’s share under the project of partition, the petitioner presented the Affidavit of HEREIN RESPONDENT AND PEDRO SEPULVEDA [SR.].
Consolidation she executed in October 1940 covering thirteen (13) of the twenty-five (25) parcels of land which were 2. THE COURT OF APPEALS ERRED IN NOT APPLYING THE LAWS ON PRESCRIPTION AND LACHES TO THE FACTS
deeded to her under the Project of Partition, 8 as well as the Order9 dated March 24, 1962 of the then CFI in Special AS PROVEN IN THE CASE AGAINST HEREIN RESPONDENT.
Proceeding No. 778-R, denying Carlota’s motion for the reconstitution of the records of the said case, and for the 3. THE COURT OF APPEALS ERRED IN UPHOLDING THE FINDING OF THE REGIONAL TRIAL COURT, BRANCH 25 IN
delivery of Dulce’s share in the eleven parcels of land. The court likewise declared therein that Dulce, through her DANAO CITY THAT PAYMENT WAS MADE BY DANAO CITY FOR ONE (1) OF THE ELEVEN (11) PARCELS INVOLVED IN
grandchildren and her mother, Carlota, had already received her share of the estate from Pedro Sepulveda, Sr. as THE CASE AND OF WHICH HEREIN RESPONDENT SHOULD BE PAID BY PETITIONER ONE THIRD (1/3) OF THE
early as January 10, 1938. PURCHASE PRICE.
4. THE COURT OF APPEALS ERRED IN AWARDING MORAL AND EXEMPLARY DAMAGES AND A SHARE IN THE RENTS
According to the petitioner, Dulce and Pedro Sepulveda, Sr. had a verbal agreement wherein the eleven parcels of AND PROFITS OF THE ELEVEN (11) PARCELS TO HEREIN RESPONDENT.
land covered by the complaint would serve as the latter’s compensation for his services as administrator of Dionisia’s 5. THE COURT OF APPEALS ERRED IN UPHOLDING THE REGIONAL TRIAL COURT’S FINDING THAT ATTORNEY’S
estate. Thus, upon the termination of Special Proceeding No. 778-0, and subsequent to the distribution of the shares FEES ARE TO BE AWARDED AND EVEN INCREASING THE AMOUNT THEREOF.16
of Dionisia’s heirs, Pedro Sepulveda, Sr. then became the sole owner of Dulce’s shares.
The petition is granted for the sole reason that the respondent failed to implead as parties, all the indispensable
The petitioner likewise adduced evidence that Santiago Sepulveda died intestate and was survived by his wife, Paz parties in his complaint.
Velez Sepulveda and their then minor children.10 It was pointed out that the private respondent failed to implead Paz
Sepulveda and her minor children as parties-defendants in the complaint. As gleaned from the material averments of the complaint and the reliefs prayed for therein, the private respondent,
as plaintiff therein, sought the recovery of the ownership and possession of the ten (10) parcels of land and the
It was further claimed that Pedro Sepulveda, Sr. declared the property covered by T.D. No. 18199 11 under his name partition thereof; and for the payment of his share in the proceeds of the sale of the property which Pedro
for taxation purposes since the beginning of 1948.12 It was likewise alleged that the eleven (11) parcels of land Sepulveda, Sr. sold to Danao City amounting to ₱7,492.00, which Pedro Sepulveda, Sr. claimed was left unpaid. It
deeded to Dulce under the Project of Partition had been declared for taxation purposes under the name of Pedro appears that when the private respondent filed the complaint, his father, Rodolfo Pelaez, was still alive. Thus, when
Sepulveda since 1974, and that he and his heirs paid the realty taxes thereon.13 his mother Dulce Pelaez died intestate on March 2, 1944, she was survived by her husband Rodolfo and their son,
the private respondent. Under Article 996 of the New Civil Code, 17 Rodolfo Pelaez, as surviving spouse, is entitled to a
portion in usufruct equal to that corresponding by way of legitime to each of the legitimate children who has not
On June 7, 1993, the trial court rendered judgment14 in favor of the private respondent. The fallo of the decision received any betterment. The rights of the usufructuary are provided in Articles 471 to 490 of the old Civil
reads: Code.18 In Gamis v. Court of Appeals,19 we held that:

56
 Under articles 807 and 834 of the old Civil Code the surviving spouse is a forced heir and entitled to a share in Indeed, the presence of all indispensable parties is a condition sine qua non  for the exercise of judicial power. It is
usufruct in the estate of the deceased spouse equal to that which by way of legitime corresponds or belongs to precisely when an indispensable party is not before the court that the action should be dismissed. Thus, the plaintiff
each of the legitimate children or descendants who have not been bettered or have not received any share in the is mandated to implead all the indispensable parties, considering that the absence of one such party renders all
one-third share destined for betterment. The right of the surviving spouse to have a share in usufruct in the estate subsequent actions of the court null and void for want of authority to act, not only as to the absent parties but even
of the deceased spouse is provided by law of which such spouse cannot be deprived and which cannot be ignored. as to those present.24 One who is a party to a case is not bound by any decision of the court, otherwise, he will be
Of course, the spouse may waive it but the waiver must be express. deprived of his right to due process. Without the presence of all the other heirs as plaintiffs, the trial court could not
validly render judgment and grant relief in favor of the private respondent. The failure of the private respondent to
Section 1, Rule 69 of the Rules of Court provides that in an action for partition, all persons interested in the property implead the other heirs as parties-plaintiffs constituted a legal obstacle to the trial court and the appellate court’s
shall be joined as defendants. exercise of judicial power over the said case, and rendered any orders or judgments rendered therein a nullity.25
Section 1. Complaint in action for partition of real estate.- A person having the right to compel the partition of real
estate may do so as in this rule prescribed, setting forth in his complaint the nature and extent of his title and an To reiterate, the absence of an indispensable party renders all subsequent actions of the court null and void for want
adequate description of the real estate of which partition is demanded and joining as defendants all the other of authority to act, not only as to the absent parties but even as to those present.26 Hence, the trial court should
persons interested in the property. have ordered the dismissal of the complaint.27

Thus, all the co-heirs and persons having an interest in the property are indispensable parties; as such, an action for IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The Decisions of the Court of Appeals in CA-G.R. CV
partition will not lie without the joinder of the said parties. 20 The mere fact that Pedro Sepulveda, Sr. has repudiated No. 43758 and of the Regional Trial Court are SET ASIDE. The Regional Trial Court is ORDERED to dismiss the
the co-ownership between him and the respondent does not deprive the trial court of jurisdiction to take cognizance complaint without prejudice. No pronouncement as to costs.
of the action for partition, for, in a complaint for partition, the plaintiff seeks, first, a declaration that he is a co-owner
of the subject property; and, second, the conveyance of his lawful shares. 21 As the Court ruled in De Mesa v. Court of
Appeals:22
The first stage of an action for judicial partition and/or accounting is concerned with the determination of whether
or not a co-ownership in fact exists and a partition is proper, that is, it is not otherwise legally proscribed and may
be made by voluntary agreement of all the parties interested in the property. This phase may end in a declaration
that plaintiff is not entitled to the desired partition either because a co-ownership does not exist or a partition is
legally prohibited. It may also end, on the other hand, with an adjudgment that a co-ownership does in truth exist,
that partition is proper in the premises, and that an accounting of rents and profits received by the defendant from
the real estate in question is in order. In the latter case, "the parties may, if they are able to agree, make partition
among themselves by proper instruments of conveyance, and the court shall confirm the partition so agreed upon
by all the parties." In either case, whether the action is dismissed or partition and/or accounting is decreed, the
order is a final one and may be appealed by any party aggrieved thereby.

The second stage commences when the parties are unable to agree upon the partition ordered by the court. In that
event, partition shall be effected for the parties by the court with the assistance of not more than three (3)
commissioners. This second phase may also deal with the rendition of the accounting itself and its approval by the
Court after the parties have been accorded the opportunity to be heard thereon, and an award for the recovery by
the party or parties thereto entitled of their just shares in the rents and profits of the real estate in question….23

In the present action, the private respondent, as the plaintiff in the trial court, failed to implead the following
indispensable parties: his father, Rodolfo Pelaez; the heirs of Santiago Sepulveda, namely, Paz Sepulveda and their
children; and the City of Danao which purchased the property covered by T.D. 19804 (T.D. No. 35090) from Pedro
Sepulveda, Sr. and maintained that it had failed to pay for the purchase price of the property.

Rodolfo Pelaez is an indispensable party he being entitled to a share in usufruct, equal to the share of the respondent
in the subject properties. There is no showing that Rodolfo Pelaez had waived his right to usufruct.

Section 7, Rule 3 of the Rules of Court reads: G.R. No. 129704 September 30, 2005
SEC. 7. Compulsory joinder of indispensable parties. – Parties in interest without whom no final determination can
be had of an action shall be joined either as plaintiffs or defendants.
ULPIANO BALO, LYDIA BALO-LUMPAS, EUGENIO BALO, ULPIANO BALO, JR., NIDA BALO-MORALETA,
NORA BALO-CATANO, ZAIDA BALO, JUDITH BALO-MANDREZA, DANILO BALO and RONILO

57
BALO, Petitioners, No evidence may be alleged or considered to test the sufficiency of the complaint except the very facts pleaded
vs. therein. It would be improper to inject into the allegation, facts not alleged and use them as basis for the decision on
THE HON. COURT OF APPEALS, HON. JUDGE ENRIQUE ASIS and JOSEFINA GARRIDO, Respondent. the motion.

A complaint for Judicial Partition of Real Properties and Accounting with Damages, docketed as Civil Case No. 279, The Court is not permitted to go beyond and outside of the allegations in the complaint for data or facts.
was filed by private respondent Josefina Garrido against petitioners Ulpiano Balo, Lydia Balo-Lumpas, Eugenio Balo,
Ulpiano Balo, Jr., Nida Balo-Moraleta, Nora Balo-Catano, Zaida Balo, Judith Balo-Mandreza, Danilo Balo and Ronilo Therefore, the allegation of illegitimacy and claim of absolute ownership are modifications and unreasonable
Balo, before the Regional Trial Court (RTC) of Abuyog, Leyte, Branch 10, alleging that she (private respondent) and inferences. If there is doubt to the truth of the facts averred in the complaint, the Court does not dismiss the
petitioners are the co-owners of undivided parcels of land located at Mayorga, Leyte. According to her, these lands complaint but requires an answer and proceeds to hear the case on the merit.6
were originally owned by the spouses Eugenio Balo, Sr. and Ma. Pasagui-Balo, who, at the time of the filing of the
complaint, were already deceased. The Balo spouses were survived by their two (2) children, Ulpiano, Sr. and
Maximino, the latter likewise deceased. Private respondent is the daughter of Maximino Balo and Salvacion Sabulao. Petitioners filed a Motion for Reconsideration7 which the RTC denied in its Order8 dated 07 November 1996.
Petitioner Ulpiano Balo is the son of Eugenio Balo, Sr., while the other petitioners, the children of Ulpiano, are
Eugenio’s grandchildren. Petitioners filed a Petition for Certiorari9 before the Court of Appeals. After the filing of Comment and other pleadings,
the case was deemed submitted for decision. In a resolution dated 16 April 1997, the Court of Appeals denied due
Private respondent further alleged in her complaint that immediately upon the death of her grandfather, Eugenio Sr., course to the petition and accordingly dismissed the same. The Court of Appeals justified the dismissal in the
the petitioners took possession of the said real properties without her knowledge and consent. The petitioners being following manner:
her uncle and cousins, private respondent earnestly requested them that they come up with a fair and equal partition It is an established rule that an order denying a motion to dismiss is basically interlocutory in character and cannot
of the properties left by her grandparents. The petitioners having outrightly refused her proposal, private respondent be the proper subject of a petition for certiorari. When a motion to dismiss is denied, the proper procedure is to
filed the complaint.1 proceed with the trial and if the decision be adverse to the movant, the remedy is to take an appeal from said
decision, assigning as one of the errors therefore the denial of the motion to dismiss.10

In lieu of an Answer, petitioners filed a Motion to Dismiss2 on the following grounds:

1. Failure to state a cause of action - plaintiff, though she claims to be a daughter of Maximino who died sometime Petitioners filed a Motion for Reconsideration11 which the Court of Appeals denied in a resolution dated 30 June
in 1946, failed to allege whether or not she is a legitimate child. Plaintiff’s failure to allege legitimacy is fatal 1997.12 Hence this petition for review13 under Rule 45 of the Rules of Court.
considering the provision of Article 992 of the Civil Code. 3 To allow Plaintiff to inherit from the estate of the spouses
Eugenio and Maria Balo in representation of her father Maximino Balo would be to permit intestate succession by an Petitioners cite the following grounds for the allowance of their petition, to wit:
illegitimate child from the legitimate parent of his father, assuming that she is the child of Maximino Balo. I WHETHER OR NOT THE FAILURE TO ALLEGE THE NATURE AND EXTENT OF PLAINTIFF’S TITLE IN A PETITION FOR
2. The complaint does not show that the estate of the spouses Eugenio and Maria Balo have been settled and its PARTITION IS FATAL TO ITS CAUSE OF ACTION.
obligations have been paid. II WHETHER OR NOT THE ACTION FOR JUDICIAL PARTITION AND ACCOUNTING HAS PRESCRIBED, WAS WAIVED,
3. The properties enumerated in the Complaint were proceeded against by way of execution to satisfy a judgment OR WAS OTHERWISE ABANDONED.14
against Eugenio and Maria Balo. Subsequently, defendant Ulpiano repurchased the said properties and has been,
together with his children, openly, exclusively and adversely in possession of the real estate properties in question.
At the threshold of the instant petition for review is the correctness of the appellate court’s dismissal of the petition
for certiorari filed by the petitioners.
Private respondent filed her comment/opposition to the motion to dismiss.4
In resolving to deny the petition, the Court of Appeals relied on the long established jurisprudence that an order
In an Order dated 12 September 1996, the RTC denied the motion to dismiss for lack of merit.5 The trial court held: denying a motion to dismiss is interlocutory and cannot be the proper subject of a petition for certiorari.

The complaint clearly states that the late Eugenio Balo, Sr., and Maria Pasagui Balo had two (2) children, namely: The general rule regarding denial of a motion to dismiss as a basis of a resort to the extraordinary writ of certiorari  is
Ulpiano, Sr. and Maximino. The plaintiff is the daughter of the late Maximino Balo and Salvacion Sabulao; while the that:
defendants are children of the late Ulpiano Balo, Sr. and Felicidad Superio. . . . [A]n 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. As such,
The complaint enumerates/annexes 13 tax declarations in the name of Eugenio Balo, Sr. marked as Annexes "A" to the general rule is that the denial of a motion to dismiss cannot be questioned in a special civil action
"M." The plaintiff as an heir prays that these parcels of land be partitioned in accordance with Article 982 of the Civil for certiorari which is a remedy designed to correct errors of jurisdiction and not errors of judgment.
Code which states:
"The grandchildren and other descendants shall inherit by right of representation, and if any one of them should To justify the grant of the extraordinary remedy of certiorari, therefore, the denial of the motion to dismiss must
have died, leaving several heirs, the portion pertaining to him shall be divided among the latter in equal portions." have been tainted with grave abuse of discretion. By "grave abuse of discretion" is meant, such capricious and
whimsical exercise of judgment as is equivalent to lack of jurisdiction. The abuse of discretion must be grave as
where the power is exercised in an arbitrary or despotic manner by reason of passion or personal hostility and must

58
 be so patent and gross as to amount to an evasion of positive duty or to a virtual refusal to perform the duty In her Complaint, the private respondent made the following assertions:
enjoined by or to act all in contemplation of law.15 . . . That the afore-described parcels of lands were originally owned by Eugenio Balo, Sr. and Ma. Pasagui-Balo,
who are now both deceased and after their death, were inherited into two (2) equal shares by their two (2)
Specific instances whereby the rule admits certain exceptions are provided as follows: children, namely: Ulpiano, Sr. and Maximino, both surnamed Balo, the later (sic) being already dead.
. . . Under certain situations, recourse to certiorari  or mandamus is considered appropriate, i.e.,  (a) when the trial
court issued the order without or in excess of jurisdiction; (b) where there is patent grave abuse of discretion by That plaintiff is the daughter of the late Maximino Balo and Salvacion Sabulao, who after her father’s death, had
the trial court; or (c) appeal would not prove to be a speedy and adequate remedy as when an appeal would not inherited her father’s share of the inheritance.
promptly relieve a defendant from the injurious effects of the patently mistaken order maintaining the plaintiff’s
baseless action and compelling the defendant needlessly to go through a protracted trial and clogging the court That defendant Ulpiano Balo, Sr. aside from being the son of Eugenio Balo, Sr., is married to Felicidad Superio, and is
dockets by another futile case.16 the father of all the other defendants in this case.

Applying the foregoing, the Court of Appeals should not have dismissed the petition outright as the same alleges The defendants took possession of the above-described real properties immediately after the death of plaintiff’s
grave abuse of discretion. Instead, it should have proceeded to determine whether or not the trial court did commit grandfather Eugenio Balo, Sr. without her knowledge and consent.
grave abuse of discretion as alleged by the petitioners. The Court of Appeals having failed in this regard, it behooves
upon this Court to discuss the merits of the petition to put to rest the issues raised by the petitioners.
That plaintiff is desirous that the above-described real properties be partitioned between her and defendants.

Contrary to petitioners’ contention, allegations sufficient to support a cause of action for partition may be found in
private respondent’s complaint.17 That plaintiff has proposed to the defendants that the above-described real properties be amicably partitioned
between them by mutual agreement in a very fair and practical division of the same, but said defendants refused and
continue to do so without any justifiable cause or reason to accede to the partition of the said properties.22
Nothing is more settled than the rule that in a motion to dismiss for failure to state a cause of action, the inquiry is
into the sufficiency, not the veracity, of the material allegations.18 Moreover, the inquiry is confined to the four
corners of the complaint, and no other.19 The foregoing allegations show substantial compliance with the formal and substantial requirements of a Complaint
for Partition as required under Section 1, Rule 69 of the 1997 Rules of Civil Procedure.23

In a motion to dismiss a complaint based on lack of cause of action, the question submitted to the court for
determination is the sufficiency of the allegations made in the complaint to constitute a cause of action and not On the insistence of petitioners that private respondent first prove her legitimacy before an action for partition may
whether those allegations of fact are true, for said motion must hypothetically admit the truth of the facts alleged in be maintained, this Court, in the case of Briz v. Briz,24 pronounced that proof of legal acknowledgment is not a
the complaint. prerequisite before an action for partition may be filed. We said:25
. . . In other words, there is no absolute necessity requiring that the action to compel acknowledgment should have
been instituted and prosecuted to a successful conclusion prior to the action in which that same plaintiff seeks
The test of the sufficiency of the facts alleged in the complaint is whether or not, admitting the facts alleged, the additional relief in the character of heir. Certainly, there is nothing so peculiar to the action to compel
court could render a valid judgment upon the same in accordance with the prayer of the complaint. (Garcon vs. acknowledgment as to require that a rule should be here applied different from that generally applicable in other
Redemptorist Fathers, 17 SCRA 341) cases. For instance, if the plaintiff had in this action impleaded all of the persons who would be necessary parties
defendant to an action to compel acknowledgement, and had asked for relief of that character, it would have been
If the allegations of the complaint are sufficient in form and substance but their veracity and correctness are permissible for the court to make the judicial pronouncement declaring that the plaintiff is entitled to be recognized
assailed, it is incumbent upon the court to deny the motion to dismiss and require the defendant to answer and go to as the natural child of Maximo Briz, and at the same time to grant the additional relief sought in this case against
trial to prove his defense. The veracity of the assertions of the parties can be ascertained at the trial of the case on the present defendants; that is, a decree compelling them to surrender to the plaintiff the parcel of land sued for
the merits. (Galeon vs. Galeon, 49 SCRA 516-521)20 and to pay her the damages awarded in the appealed decision.

Section 1, Rule 8 of the 1997 Rules of Civil Procedure provides that the complaint needs only to allege the ultimate The conclusion above stated, though not heretofore explicitly formulated by this court, is undoubtedly to some extent
facts upon which private respondent bases her claim. supported by our prior decisions. Thus, we have held in numerous cases, and the doctrine must be considered well
settled, that a natural child having a right to compel acknowledgment, but who has not been in fact legally
The rules of procedure require that the complaint must make a concise statement of the ultimate facts or the acknowledged, may maintain partition (proceedings for the division of the inheritance against his coheirs (Siguiong
essential facts constituting the plaintiff’s cause of action. A fact is essential if it cannot be stricken out without leaving vs. Siguiong, 8 Phil. 5; Tiamson vs. Tiamson, 32 Phil 62); and the same person may intervene in proceedings for the
the statement of the cause of action inadequate. A complaint states a cause of action only when it has its three distribution of the estate of his deceased natural father, or mother (Capistrano vs. Fabella, 8 Phil. 135; Conde vs.
indispensable elements, namely: (1) a right in favor of the plaintiff by whatever means and under whatever law it Abaya, 13 Phil. 249; Ramirez vs. Gmur, 42 Phil 855). In neither of these situations has it been thought necessary for
arises or is created; (2) an obligation on the part of the named defendant to respect or not to violate such right; and the plaintiff to show a prior decree compelling acknowledgment. The obvious reason is that in partition suits and
(3) an act or omission on the part of such defendant violate of the right of plaintiff or constituting a breach of the distribution proceedings the other persons who might take by inheritance are before the court; and the declaration of
obligation of defendant to the plaintiff for which the latter may maintain an action for recovery of damages.21 heirship is appropriate to such proceedings.

59
To further reiterate that in partition proceedings, dismissal prior to answer is premature, this Court has held: G.R. No. 109963 October 13, 1999
In a complaint for partition, the plaintiff seeks, first, a declaration that he is a co-owner of the subject properties;
and second, the conveyance of his lawful shares. As the Court of Appeals correctly held, an action for partition is at HEIRS OF JOAQUIN TEVES: RICARDO TEVES, ARCADIA TEVES, TOMAS ZAMORA, FELICIA TEVES, HELEN
once an action for declaration of co-ownership and for segregation and conveyance of a determine portion of the TEVES, ALFREDO OSMEÑA, ROBERTO TEVES, JOAQUIN TEVES, III, PETER TEVES, MILDRED TEVES,
properties involved. If the defendant asserts exclusive title over the property, the action for partition should not be WILSON MABILOG, LEONILO PATIGAYON, EDUARDO PATIGAYON, ALEXANDER PATIGAYON, ALDRIN
dismissed. Rather, the court should resolve the case and if the plaintiff is unable to sustain his claimed status as a PATIGAYON, NOEL PATIGAYON, VICTOR PATIGAYON, MA. TEVES PATERNO OCHOTORENA, EXEQUILA
co-owner, the court should dismiss the action, not because the wrong remedy was availed of, but because no basis TEVES, EMILIO JO, EMILIANA TEVES, MILAGROS TEVES, EDSEL PINILI, VICENTE TEVES, EMILIANA ISO,
exists for requiring the defendant to submit to partition. If, on the other hand, the court after trial should find the ALBERTO TEVES, ERLINDA TEVES, DIOSDADO TEVES, VICTORIA TEVES AND VIVENCIO
existence of co-ownership among the parties, the court may and should order the partition of the properties in the NARCISO, petitioners,
same action.26 vs.
COURT OF APPEALS, HEIRS OF ASUNCION IT-IT NAMELY: ELISA IT-IT, SUSANA IT-IT, NORBERTO IT-IT,
The case of Vda. De Daffon v. Court of Appeals27 is almost most appropriate. In said case, the action for partition ISA-AC IT-IT, JR., JAIME IT-IT, FELICITAS IT-IT, TERESITA IT-IT, ANTONIO NODADO, CORAZON IT-IT,
filed by the plaintiffs was met by a motion to dismiss filed by the defendants based on the grounds of failure of the JIMMY LERO, DANILO IT-IT, EDITA GAMORA, PACITA VAILOCES, CRIS VAILOCES, CECILIA CIMAFRANCA
complaint to state a cause of action, waiver, abandonment and extinguishment of the obligation. The trial court and CECILIA FLOR CIMAFRANCA, respondents.
denied the motion to dismiss and the denial was affirmed by the appellate court and by this Court. We held there
that the trial court and the Court of Appeals were correct in dismissing the petition for certiorari  absent a clear Before us is a petition for review on certiorari  assailing the decision 1 of the Court of Appeals which was promulgated
showing of grave abuse of discretion amounting to lack or excess of jurisdiction. We further expressed our dismay on August 18, 1992 affirming the July 11, 1991 decision 2 of Branch 38 of the Regional Trial Court of Negros Oriental
over the delay in the resolution of the said case due to the fact that the issue of the denial of the Motion to Dismiss in favor of defendants-appellees.
was elevated to this Court by petitioner and counsel instead of just filing an Answer and meeting the issues head-on.

Marcelina Cimafranca and Joaquin Teves had nine children, namely Teotimo, Felicia, Pedro, Andres, Asuncion,
On the matter of prescription cited by the petitioners as a ground for the dismissal of the complaint, it is noteworthy Gorgonio, Cresenciano, Arcadia and Maria. Andres, however, predeceased both his parents and died without issue.
that the motion to dismiss filed by the petitioners did not ipso facto establish prescription. An allegation of After Marcelina Cimafranca and Joaquin Teves died, intestate and without debts, in 1943 and 1953, respectively,
prescription can effectively be used in a motion to dismiss only when the complaint on its face shows that indeed the their children executed extrajudicial settlements purporting to adjudicate unto themselves the ownership over two
action has already prescribed;28 otherwise, the issue of prescription is one involving evidentiary matters requiring a parcels of land belonging to their deceased parents and to alienate their shares thereto in favor of their sister
full-blown trial on the merits and cannot be determined in a mere motion to dismiss.29 Asuncion Teves. The validity of these settlements executed pursuant to section 1 of Rule 74 of the Rules of Court is
the primary issue in the present case.1âwphi1.nêt
Wherefore, premises considered, the instant Petition is DENIED and the decision of the Court of Appeals in CA-G.R.
SP No. 42803, affirming the Order of the Regional Trial Court dated 12 September 1996, is AffIRmed. This case is On May 9, 1984, plaintiffs-appellants Ricardo and Arcadia Teves filed a complaint with the Regional Trial Court of
ordered remanded to the court of origin which is directed to resolve the case with dispatch. Costs against petitioners. Negros Oriental for the partition and reconveyance of two parcels of land located in Dumaguete, designated as Lots
769-A and 6409, against the heirs of Asuncion Teves. The complaint was subsequently amended to include Maria
Teves and the heirs of Teotimo, Felicia, Pedro, and Gorgonio Teves as plaintiffs and the spouses Lucresio Baylosis
and Pacita Nocete, and Cecilia Cimafranca-Gamos and Cecilia Flor Cimafranca as defendants. 3 Plaintiffs-appellants
alleged that defendants-appellees, without any justifiable reason, refused to partition the said parcels of land and to
convey to plaintiffs their rightful shares. 4

Lot 769, covered by Original Certificate of Title (OCT) No. 4682-A, 5 is registered in the names of Urbana Cimafranca,
one-fourth (1/4) share, Marcelina Cimafranca, the wife of Joaquin Teves, one-fourth (1/4) share, Domingo
Villahermosa, one-eighth (1/8) share, Antero Villahermosa, one-eighth (1/8) share, Cecilia Cimafranca, one-eighth
(1/8) share and Julio Cimafranca, one-eighth (1/8) share. The present controversy involves only Marcelina
Cimafranca's one-fourth (1/4) share in the land, designated as Lot 769-A.

On June 13, 1956, Teotimo, Felicia, Pedro, Asuncion, Gorgonio and Arcadia Teves executed a document entitled
"Settlement of Estate and Sale," 6 adjudicating unto themselves, in equal shares, Lot 769-A and conveying their
shares, interests and participations over the same in favor of Asuncion Teves for the consideration of P425.00. A
similar deed denominated "Extrajudicial Settlement and Sale" 7 was signed by Maria Teves on April 21, 1959. Under
such deed, Maria conveys her own share over Lot 769-A in favor of Asuncion Teves for the consideration of P80.00.
The two settlements were denounced by the plaintiffs as spurious. The trial court summarized the claims of the
plaintiffs, viz —

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 . . . Maria Teves Ochotorena herself, denied having executed this Extrajudicial Settlement and Sale over her share Plaintiffs likewise contend that as regards the share of Ricardo Teves, son of Crescenciano Teves who predeceased
or interest in Lot 769 claiming that her signature in said document is a forgery. She disowns her signature Joaquin and Marcelina, it was not at all affected in that extrajudicial settlement and sale since neither Crescenciano
declaring that as a married woman she always signs a document in her husband's family name. Further, she Teves nor his son Ricardo Teves participated in its execution.
declared that on the date she purportedly signed said document in Dumaguete City before the notary public, she
was in her home in Katipunan, Zamboanga del Norte. Likewise, plaintiffs offered TCT No. 5761 for Lot 6409 registered in the name of Asuncion Teves It-it as Exhibit "B"
as proof that said property was later titled in trust for all the heirs of Joaquin Teves and which was used later as
On Exhibit "G" which is likewise offered as Exhibit "3" for the defendants, plaintiffs hold that said document is basis in effecting a deed of sale in favor of co-defendant Lucresio Baylosis. In this light, the plaintiffs argue that the
spurious claiming that the signatures of Pedro Teves, Felicia Teves and Gorgonio Teves are all forgeries. To support sale of said property is a nullity for it was not only attended with bad faith on the part of both the vendor and the
this allegation, Helen T. Osmena, daughter of Felicia Teves and Erlinda Teves, daughter of Gorgonio Teves were vendee but primarily the vendor had no right at all to part with said property which is legally owned by others. 16
presented as witnesses. Being allegedly familiar with the style and character of the handwriting of their parents
these witnesses declared unequivocally that the signatures of their parents appearing on the document are In answer to plaintiffs-appellants' charges of fraud, defendants-appellees maintained that the assailed documents
forgeries. were executed with all the formalities required by law and are therefore binding and legally effective as bases for
acquiring ownership or legal title over the lots in question. Furthermore, it is contended that plaintiffs-appellants
In sum, plaintiffs argue that these fraudulent documents which defendants rely in claiming ownership to the have slept on their rights and should now be deemed to have abandoned such rights. 17
disputed properties are all nullities and have no force in law and could not be used as basis for any legal title.
Consequently, in their view, they are entitled to the reliefs demanded particularly, to their respective shares of the The trial court ruled in favor of defendants-appellees and rendered judgment dismissing the complaint with costs
disputed properties. 8 against plaintiffs-appellants. As regards Lot 6409, the court declared that the Extrajudicial Settlement and Sale
executed by the heirs of Joaquin Teves and Marcelina Cimafranca was duly executed with all the formalities required
The other property in dispute is Lot 6409 which was originally covered by OCT No. 9091 9 and was registered in the by law, thus, validly conveying Lot 6409 in favor of Asuncion Teves. Moreover, it stated that, even granting the truth
name of Joaquin Teves and his two sisters, Matea and Candida Teves. However, Matea and Candida died without of the imputed infirmities in the deed, the right of plaintiffs-appellants to bring an action for partition and
issue, causing the entire property to pass to Joaquin Teves. On December 14, 1971, Lot 6409 was adjudicated and reconveyance was already barred by prescription. An action for the annulment of a partition must be brought within
divided in equal shares in a "Deed of Extrajudicial Settlement & Sale" 10 executed by Joaquin Teves' children — four years from the discovery of the fraud, while an action for the reconveyance of land based upon an implied or
Asuncion, Teotimo, Felisia, Gorgonio, Arcadia and Maria Teves. In the same deed, the shares of these same heirs in constructive trust prescribes after ten years from the registration of the deed or from the issuance of the title. The
Lot 6409 were sold to Asuncion Teves for P100.00. Asuncion Teves took possession of the land and acquired complaint in this case was filed on May 9, 1984, exactly 12 years, 1 month and 17 days after the issuance of the
title 11 over the same on March 22, 1972. After her death in 1981, her children, defendants-appellees It-it herein, transfer certificate of title in the name of Asuncion Teves on March 22, 1972. Thus, ownership over Lot 6409
extrajudicially settled Asuncion Teves' property, adjudicating unto themselves Lot 6409. 12 On July 20, 1983 a new rightfully belonged to defendants-appellees It-it.
transfer certificate of title 13 was issued in the names of Asuncion Teves' children, namely Elisa, Susana, Norberto,
Isaac, Jaime, Felicitas, Teresita, Corazon, and Danilo, all surnamed It-it. On July 2, 1984, the It-its sold Lot 6409 to Moreover, the trial court held that the extrajudicial settlements over both Lots 6409 and 769, having been prepared
defendants-appellees Lucrecio Baylosis, Sr. and Pacita Nocete-Baylosis for P20,000.00 14 and a transfer certificate of and acknowledged before a notary public, are public documents, vested with public interest, the sanctity of which
title 15 was issued in the name of the Baylosis couple. deserves to be upheld unless overwhelmed by clear and convincing evidence. The evidence presented by the
plaintiffs to support their charges of forgery was considered by the court insufficient to rebut the legal presumption of
Plaintiffs-appellants claim that the Deed of Extrajudicial Settlement & Sale covering Lot 6409 is also spurious. Their validity accorded to such documents. 18
arguments were discussed in the trial court's decision as follows —
Presented as Exhibit "D" and "1" for both the plaintiffs and defendants respectively, is a document denominated as The Court of Appeals upheld the trial court's decision affirming the validity of the extrajudicial statements, with a
"Extrajudicial Settlement and Sale" executed on December 4, 1971 by and among the heirs of Joaquin Teves and slight modification. It disposed of the case, thus —
Marcelina Cimafranca. This document which gave birth to TCT No. 5761 over Lot 6409 registered in the name of WHEREFORE, premises considered, the decision appealed from is AFFIRMED with the modification in that herein
Asuncion Teves It-it is questioned by the plaintiffs as spurious for the following reasons: defendant-appellees are hereby ORDERED to partition Lot 769-A and deliver to plaintiff-appellant Ricardo Teves
1. Erasure of the word "quitclaim" is superimposed with the word "sale" in handwriting. one-eight (sic) (1/8) portion thereof corresponding to the share of his deceased father Cresenciano Teves. No
2. The consideration of "One peso" stated in document is intercalated with the word "hundred" in handwriting. costs.
3. The signature of Maria Teves Ochotorena, Pedro Teves and Felicia Teves are forgeries.
4. The thumbmark imposed on the name of Gorgonio Teves does not actually belong to Gorgonio Teves who was
an educated man and skilled in writing according to his daughter. The appellate court said that plaintiffs-appellants' biased and interested testimonial evidence consisting of mere
denials of their signatures in the disputed instruments is insufficient to prove the alleged forgery and to overcome the
evidentiary force of the notarial documents. It also ruled that the plaintiffs-appellants' claim over Lot 6409 was
Aside from these defects which would make said document null and void, Arcadia Teves who is one of the living barred by prescription after the lapse of ten years from the issuance of title in favor of Asuncion Teves, while their
sisters of the mother of the principal defendants although confirming the authenticity of her signature averred that claim over Lot 769-A is barred by laches since more than 25 years has intervened between the sale to Asuncion
in reality no consideration was ever given to her and that her impression of the said document was that she was Teves and the filing of the present case in 1984.
only giving her consent to sell her share of the land.

The appellate court noted that the conveyance of Lot 769-A in favor of Asuncion Teves did not affect the share of
Cresenciano Teves as he was not a signatory to the settlements. It also found that Ricardo Teves, Cresenciano's heir,

61
is in possession of a portion of Lot 769-A and that defendants-appellees do no not claim ownership over such portion. It is noted that the Deed of Extrajudicial Settlement & Sale covering Lot 6409 purports to divide Joaquin Teves'
Thus, the defendants-appellees It-it were ordered to partition and convey to Ricardo Teves his one-eighth share over estate among only six of his heirs, namely Asuncion, Teotimo, Felisia, Gorgonio, Arcadia and Maria Teves. 25 It does
Lot 769-A.1âwphi1.nêt not mention nor bear the signatures of either Pedro or Cresenciano Teves although they are both intestate heirs of
Joaquin Teves and as such, are entitled to a proportionate share of the decedent's estate. Contrary to the ruling of
As regards the extrajudicial settlement involving Lot 6409, although it was found by the appellate court that the appellate court, the fact that Cresenciano predeceased Joaquin Teves does not mean that he or, more accurately,
Cresenciano Teves was also not a signatory thereto, it held that it could not order the reconveyance of the latter's his heirs, lose the right to share in the partition of the property for this is a proper case for representation, wherein
share in such land in favor of his heir Ricardo Teves because Cresenciano had predeceased Joaqin Teves. Moreover, the representative is raised to the place and degree of the person represented and acquires the rights which the
Ricardo Teves, by a deed simply denominated as "Agreement" executed on September 13, 1955 wherein he was latter would have if he were living. 26
represented by his mother, authorized the heirs of Joaquin Teves to sell his share in Lot 6409. 19
However, notwithstanding their non-inclusion in the settlement, the action which Pedro and Cresenciano might have
Plaintiffs-appellants assailed the appellate court's decision upon the following grounds — brought for the reconveyance of their shares in the property has already prescribed. An action for reconveyance
I. IN CONSIDERING RICARDO TEVES AS BOUND BY THE SIGNATURE OF HIS MOTHER, INSPITE OF DEATH OF based upon an implied trust pursuant to article 1456 of the Civil Code prescribes in ten years from the registration of
CRESENCIANO TEVES IN 1944; AND UNDER THE OLD CIVIL CODE THE SPOUSE CANNOT INHERIT EXCEPT THE the deed or from the issuance of the title. 27 Asuncion Teves acquired title over Lot 6409 in 1972, but the present
USUFRUCT; case was only filed by plaintiffs-appellants in 1984, which is more than 10 years from the issuance of title. 28
II. IN UPHOLDING SWEEPINGLY THE PRESUMPTION OF REGULARITY OF NOTARIZED DEED, DESPITE CLEAR,
CONVINCING, SUBSTANTIAL AND SUFFICIENT EVIDENCE THAT MARIA OCHOTORENA WAS IN MINDANAO; THE The division of Lot 769-A, on the other hand, was embodied in two deeds. The first extrajudicial settlement was
NOTARY PULIC DID NOT KNOW MARIA OCHOTORENA AND THE SIGNATURES OF THE OTHER HEIRS IN THE entered into by Teotimo, Felicia, Pedro, Gorgonio, Arcadia and Asuncion Teves in 1956 29, while the second deed was
QUESTIONED DOCUMENT ARE BELIED BY COMPARISON WITH THE GENUINE SIGNATURE IN EXH. "E"; executed in 1959 by Maria Teves. 30 Cresenciano was not a signatory to either settlement. However, in contrast to
III. IN VALIDATING THE ONE PESO CONSIDERATION, INSPITE OF NO OTHER VALUABLE CONSIDERATION, THE the extrajudicial settlement covering Lot 6409, the two extrajudicial settlements involving Lot 769-A do not purport
SUPERIMPOSED P100 WAS UNILATERALLY INSERTED, SHOWING FICTITIOUS AND SIMULATED CONSIDERATION; to exclude Cresenciano from his participation in Lot 769-A or to cede his share therein in favor of Asuncion. The
AND settlement clearly adjudicated the property in equal shares in favor of the eight heirs of Marcelina Cimafranca.
IV. PRESCRIPTION DOES NOT START FROM A VOID CONTRACT. 20 Moreover, the deeds were intended to convey to Asuncion Teves only the shares of those heirs who affixed their
signatures in the two documents. The pertinent portions of the extrajudicial settlement executed in 1956, of which
We affirm that the extrajudicial settlements executed by the heirs of Joaquin Teves and Marcelina Cimafranca are substantively identical provisions are included in the 1959 deed, provide —
legally valid and binding. 5. That by virtue of the right of succession the eight heirs above mentioned inherit and adjudicate unto
themselves in equal shares Lot No. 769-A and our title thereto is evidenced by the O.C. of Title No. 4682-A of the
Land Records of Negros Oriental.
The extrajudicial settlement of a decedent's estate is authorized by section 1 of Rule 74 of the Rules of Court, which
provides in pertinent part that —
If the decedent left no will and no debts and the heirs are all of age, or the minors are represented by their judicial THAT FOR AND IN CONSIDERATION of the sum of FOUR HUNDRED TWENTY-FIVE (P425.00) PESOS, Philippine
or legal representatives duly authorized for the purpose, the parties may, without securing letters of Currency which we have received from ASUNCION TEVES; WE, Teotimo, Felicia, Pedro, Gorgonio and Arcadia, all
administration, divide the estate among themselves as they see fit by means of a public instrument filed in the surnamed Teves, do hereby sell, transfer and convey unto Asuncion Teves, married to Isaac Itit, Filipino, of legal
office of the register of deeds, . . . age and resident of and with postal address in the City of Dumaguete, all our shares, interests and participations
over Lot 769-A of the subdivision plan, Psd, being a portion of Lot No. 769 of the Cadastral Survey of
Dumaguete, her heirs, successors and assigns, together with all the improvements thereon.
Thus, for a partition pursuant to section 1 of Rule 74 to be valid, the following conditions must concur: (1) the
decedent left no will; (2) the decedent left no debts, or if there were debts left, all had been paid; (3) the heirs are
all of age, or if they are minors, the latter are represented by their judicial guardian or legal representatives; (4) It has even been admitted by both parties that Ricardo Teves is in possession of an undetermined portion of Lot
the partition was made by means of a public instrument or affidavit duly filed with the Register of Deeds. 21 769-A and defendants-appellees It-it do not claim ownership over his share in the land. 31 Thus, contrary to the
appellate court's ruling, there is no basis for an action for reconveyance of Ricardo Teves' share since, in the first
place, there has been no conveyance. Ricardo Teves is entitled to the ownership and possession of one-eighth of
We uphold, finding no cogent reason to reverse, the trial and appellate courts' factual finding that the evidence Lot 769-A.
presented by plaintiffs-appellants is insufficient to overcome the evidentiary value of the extrajudicial settlements.
The deeds are public documents and it has been held by this Court that a public document executed with all the legal
formalities is entitled to a presumption of truth as to the recitals contained therein. 22 In order to overthrow a Neither does Ricardo Teves have a right to demand partition of Lot 769-A because the two extajudicial settlements
certificate of a notary public to the effect that the grantor executed a certain document and acknowledged the fact of have already effectively partitioned such property. Every act which is intended to put an end to indivision among co-
its execution before him, mere preponderance of evidence will not suffice. Rather, the evidence must be so clear, heirs and legatees or devisees is deemed to be a partition, although it should purport to be a sale, an exchange, a
strong and convincing as to exclude all reasonable dispute as to the falsity of the certificate. When the evidence is compromise, or any other transaction. 32 The extrajudicial settlements executed in 1956 and 1959 adjudicated Lot
conflicting, the certificate will be upheld. 23 The appellate court's ruling that the evidence presented by plaintiffs- 769-A in equal shares unto the eight heirs of Marcelina Cimafranca. Such a partition, which was legally made, confers
appellants does not constitute the clear, strong, and convincing evidence necessary to overcome the positive value of upon each heir the exclusive ownership of the property adjudicated to him. 33 Although Cresenciano, Ricardo's
the extrajudicial settlements executed by the parties, all of which are public documents, being essentially a finding of predecessor-in-interest, was not a signatory to the extrajudicial settlements, the partition of Lot 769-A among the
fact, is entitled to great respect by the appellate court and should not be disturbed on appeal. 24 heirs was made in accordance with their intestate shares under the law. 34

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With regards to the requisite of registration of extrajudicial settlements, it is noted that the extrajudicial settlements
covering Lot 769-A were never registered. However, in the case of Vda. de Reyes vs. CA, 35 the Court, interpreting
section 1 of Rule 74 of the Rules of Court, upheld the validity of an oral partition of the decedent's estate and
declared that the non-registration of an extrajudicial settlement does not affect its intrinsic validity. It was held in
G..R. No. 132424             May 2, 2006
this case that —
[t]he requirement that a partition be put in a public document and registered has for its purpose the protection of
creditors and at the same time the protection of the heirs themselves against tardy claims. The object of SPOUSES BONIFACIO R. VALDEZ, JR. and VENIDA M. VALDEZ, Petitioners,
registration is to serve as constructive notice to others. It follows then that the intrinsic validity of partition not vs.
executed with the prescribed formalities does not come into play when there are no creditors or the rights of HON. COURT OF APPEALS, SPOUSES GABRIEL FABELLA and FRANCISCA FABELLA, Respondents.
creditors are not affected. Where no such rights are involved, it is competent for the heirs of an estate to enter into
an agreement for distribution in a manner and upon a plan different from those provided by law. This case originated from a complaint for unlawful detainer filed by petitioners Bonifacio and Venida Valdez against
private respondents Gabriel and Francisca Fabella before the Municipal Trial Court of Antipolo, Rizal. The complaint
Thus, despite its non-registration, the extrajudicial settlements involving Lot 769-A are legally effective and binding alleges these material facts:
among the heirs of Marcelina Cimafranca since their mother had no creditors at the time of her death. 2. That plaintiffs are the registered owner[s] of a piece of residential lot denominated as Lot [N]o. 3 Blk 19 located
at Carolina Executive Village, Brgy. Sta. Cruz, Antipolo, Rizal which [they] acquired from Carolina Realty, Inc.
Sometime [i]n November 1992 by virtue of Sales Contract, xerox copy of which is hereto attached marked as
Except for the portion of Lot 769-A occupied by Ricardo Teves, both parcels of land have been and continue to be in
Annex "A" and the xerox copy of the Torrens Certificate of Title in her name marked as Annex "B";
the possession of Asuncion Teves and her successors-in-interest. 36 Despite this, no explanation was offered by
3. That defendants, without any color of title whatsoever occupie[d] the said lot by building their house in the said
plaintiffs-appellants as to why they instituted the present action questioning the extrajudicial settlements only in
lot thereby depriving the herein plaintiffs rightful possession thereof;
1984, which is more than 25 years after the assailed conveyance of Lot 769-A and more than 10 years after the
4. That for several times, plaintiffs orally asked the herein defendants to peacefully surrender the premises to
issuance of a transfer certificate of title over Lot 6409, both in favor of Asuncion Teves. Such tardiness indubitably
them, but the latter stubbornly refused to vacate the lot they unlawfully occupied;
constitutes laches, which is the negligence or omission to assert a right within a reasonable time, warranting a
5. That despite plaintiffs’ referral of the matter to the Barangay, defendants still refused to heed the plea of the
presumption that the party entitled to assert it either has abandoned it or declined to assert it. 37 Thus, even
former to surrender the lot peacefully;
assuming that plaintiffs-appellants had a defensible cause of action, they are barred from pursuing the same by
6. That because of the unfounded refusal of the herein defendants to settle the case amicably, the Barangay
reason of their long and inexcusable inaction.
Captain was forced to issue the necessary Certification to File Action in favor of the herein plaintiffs in order that
the necessary cause of action be taken before the proper court, xerox copy of which is hereto attached marked as
An extrajudicial settlement is a contract and it is a well-entrenched doctrine that the law does not relieve a party Annex "C";
from the effects of a contract, entered into with all the required formalities and with full awareness of what he was 7. That by reason of the deliberate, malicious and unfounded refusal of the defendants to vacate/surrender the
doing, simply because the contract turned out to be a foolish or unwise investment. 38 Therefore, although plaintiffs- premises in question, the herein plaintiffs were constrained to engage the professional services of counsel thus
appellants may regret having alienated their hereditary shares in favor of their sister Asuncion, they must now be incurring expenses amounting to TEN THOUSAND PESOS (P10,000.00) representing acceptance fee and additional
considered bound by their own contractual acts.1âwphi1.nêt ONE THOUSAND PESOS (P1,000.00) per appearance, who on July 12, 1994 sent a formal demand was likewise
ignored, (sic) copy of which is hereto attached as Annex "D";
WHEREFORE, the August 18, 1992 decision of the Court of Appeals is hereby AFFIRMED. No pronouncements as to 8. That likewise by virtue of the adamant refusal of the defendants to vacate/surrender the said premises in
costs. question, plaintiff[s] suffered serious anxiety, sleepless nights, mental torture and moral erosion; x x x2

In their answer, private respondents contended that the complaint failed to state that petitioners had prior physical
possession of the property or that they were the lessors of the former. In the alternative, private respondents
claimed ownership over the land on the ground that they had been in open, continuous, and adverse possession
thereof for more than thirty years, as attested by an ocular inspection report from the Department of Environment
and Natural Resources. They also stressed that the complaint failed to comply with Supreme Court Circular No. 28-91
regarding affidavits against non-forum shopping.

The Municipal Trial Court (MTC) rendered a decision in favor of the petitioners, ordering private respondents to
vacate the property and to pay rent for the use and occupation of the same plus attorney’s fees.

Private respondents appealed the MTC’s decision to the Regional Trial Court (RTC). The RTC, in a decision dated 8
January 1997, affirmed in toto the decision of the MTC.

Undeterred, the private respondents filed a petition for review with the Court of Appeals on 10 March 1997
questioning the decision of the RTC.

63
In a decision dated 22 April 1997, the Court of Appeals reversed and set aside the decision of the RTC. It held that and that the issue is which party has prior de facto possession while in unlawful detainer, possession of the
petitioners failed to make a case for unlawful detainer because they failed to show that they had given the private defendant is originally legal but became illegal due to the expiration or termination of the right to possess.9
respondents the right to occupy the premises or that they had tolerated private respondents’ possession of the same,
which is a requirement in unlawful detainer cases. It added that the allegations in petitioners’ complaint lack The jurisdiction of these two actions, which are summary in nature, lies in the proper municipal trial court or
jurisdictional elements for forcible entry which requires an allegation of prior material possession. The Court of metropolitan trial court.10 Both actions must be brought within one year from the date of actual entry on the land, in
Appeals ratiocinated thus: case of forcible entry, and from the date of last demand, in case of unlawful detainer. 11 The issue in said cases is the
An examination of the complaint reveals that key jurisdictional allegations that will support an action for ejectment right to physical possession.
are conspicuously lacking. In particular, an allegation of prior material possession is mandatory in forcible entry,
xxx and the complaint is deficient in this respect. On the other hand, neither does there appear to be a case of
unlawful detainer, since the private respondents failed to show that they had given the petitioners the right to Accion publiciana is the plenary action to recover the right of possession which should be brought in the proper
occupy the premises, which right has now [been] extinguished. regional trial court when dispossession has lasted for more than one year.12 It is an ordinary civil proceeding to
xxx determine the better right of possession of realty independently of title. 13 In other words, if at the time of the filing of
In light of the foregoing, the conclusion is inevitable that the Municipal Trial Court before which the action for the complaint more than one year had elapsed since defendant had turned plaintiff out of possession or defendant’s
ejectment was filed had no jurisdiction over the case. Consequently, the dismissal thereof is in order. possession had become illegal, the action will be, not one of the forcible entry or illegal detainer, but an
WHEREFORE, the Petition is hereby GIVEN DUE COURSE, and GRANTED. The decision dated 08 January 1997 accion publiciana. On the other hand, accion reivindicatoria is an action to recover ownership also brought in the
rendered by the respondent court is hereby REVERSED and SET ASIDE, and judgment is hereby rendered proper regional trial court in an ordinary civil proceeding.14
DISMISSING the complaint in Civil Case No. 2547 of the Municipal Trial Court of Antipolo, Rizal for lack of
jurisdiction.3 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. 15 Otherwise, if the possession
Petitioners filed a motion for reconsideration which was denied in a resolution dated 30 January 1998.4 was unlawful from the start, an action for unlawful detainer would be an improper remedy. 16 As explained in Sarona
v. Villegas17:
But even where possession preceding the suit is by tolerance of the owner, still, distinction should be made.
Hence, the instant petition. 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
Petitioners submit the following issues for the Court’s consideration5: from the date of the demand to vacate.
A. WHETHER OR NOT THE ALLEGATIONS OF THE COMPLAINT CLEARLY MADE OUT A CASE FOR UNLAWFUL xxxx
DETAINER. A close assessment of the law and the concept of the word "tolerance" confirms our view heretofore expressed that
B. WHETHER OR NOT BASED ON THE ALLEGATION(S) OF THE COMPLAINT, THE MUNICIPAL TRIAL COURT OF such tolerance must be present right from the start of possession sought to be recovered, to categorize a cause of
ANTIPOLO, RIZAL, CLEARLY HAS ORIGINAL JURISDICTION OVER THE INSTANT COMPLAINT FILED BEFORE IT. 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.
Since the two issues are closely intertwined, they shall be discussed together. 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
In the main, petitioners claim that the averments of their complaint make out a case for unlawful detainer having the inferior court is allowed after the lapse of a number of years, then the result may well be that no action of
alleged that private respondents unlawfully withheld from them the possession of the property in question, which forcible entry can really prescribe. No matter how long such defendant is in physical possession, plaintiff will merely
allegation is sufficient to establish a case for unlawful detainer. They further contend that the summary action for make a demand, bring suit in the inferior court – upon a plea of tolerance to prevent prescription to set in - and
ejectment is the proper remedy available to the owner if another occupies the land at the former’s tolerance or summarily throw him out of the land. Such a conclusion is unreasonable. Especially if we bear in mind the
permission without any contract between the two as the latter is bound by an implied promise to vacate the land postulates that proceedings of forcible entry and unlawful detainer are summary in nature, and that the one year
upon demand by the owner. time-bar to suit is but in pursuance of the summary nature of the action.18 (Underlining supplied)

The petition is not meritorious. 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,
Under existing law and jurisprudence, there are three kinds of actions available to recover possession of real however, the entry is legal but the possession thereafter becomes illegal, the case is unlawful detainer.
property: (a) accion interdictal; (b) accion publiciana; and (c) accion reivindicatoria.6
Indeed, to vest the court jurisdiction to effect the ejectment of an occupant, it is necessary that the complaint should
Accion interdictal comprises two distinct causes of action, namely, forcible entry (detentacion) and unlawful detainer embody such a statement of facts as brings the party clearly within the class of cases for which the statutes provide
(desahuico).7 In forcible entry, one is deprived of physical possession of real property by means of force, a remedy, as these proceedings are summary in nature.19 The complaint must show enough on its face the court
intimidation, strategy, threats, or stealth whereas in unlawful detainer, one illegally withholds possession after the jurisdiction without resort to parol testimony.20
expiration or termination of his right to hold possession under any contract, express or implied. 8 The two are
distinguished from each other in that in forcible entry, the possession of the defendant is illegal from the beginning,

64
The jurisdictional facts must appear on the face of the complaint. When the complaint fails to aver facts constitutive detainer is fatal.26 Since the complaint did not satisfy the jurisdictional requirement of a valid cause for unlawful
of forcible entry or unlawful detainer, as where it does not state how entry was affected or how and when detainer, the municipal trial court had no jurisdiction over the case.27 It is in this light that this Court finds that the
dispossession started, the remedy should either be an accion publiciana or an accion reivindicatoria in the proper Court of Appeals correctly found that the municipal trial court had no jurisdiction over the complaint.
regional trial court.21 Thus, in Go, Jr. v. Court of Appeals,22 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 WHEREFORE, the petition is DENIED and the judgment of the Court of Appeals dismissing the complaint in Civil Case
by respondent by mere tolerance of petitioners as well as their deceased mother. Resolving the issue on whether or No. 2547 of the MTC Antipolo, Rizal for lack of jurisdiction is hereby AFFIRMED.
not petitioners’ case for unlawful detainer will prosper, the court ruled23:
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
G.R. No. 149912               January 29, 2004
refused to vacate the property. x x x

JACINTO V. CO, Petitioner,
It is settled that one whose stay is merely tolerated becomes a deforciant illegally occupying the land the moment he
vs.
is required to leave. It is essential in unlawful detainer cases of this kind, that plaintiff’s supposed acts of tolerance
RIZAL MILITAR and LILIA SONES, Respondents.
must have been present right from the start of the possession which is later sought to be recovered. This is where
petitioners’ cause of action fails. 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 Petitioner Jacinto V. Co claims to be the owner of a parcel of land measuring 396 square meters covered by a
Transfer Certificate of Title No. 81792.3 The land was formerly owned by Rolando Dalida, in whose name it was
registered under TCT No. 192224.4
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 Dalida mortgaged5 the land to petitioner to secure payment of a loan. After Dalida defaulted in the payment of his
the land was effected clandestinely, without the knowledge of the owners, consequently, it is categorized as obligation, petitioner caused the foreclosure of the mortgage. Subsequently, petitioner acquired the land at the
possession by stealth which is forcible entry. As explained in Sarona vs. Villegas, cited in Muñoz vs. Court foreclosure sale held sometime in 1982.
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. On June 19, 1997, petitioner filed a complaint for unlawful detainer before the Metropolitan Trial Court of Marikina
City, Branch 75, against respondents Rizal Militar and Lilia Sones, who were in possession of the land.
And in the case of Ten Forty Realty and Development Corp. v. Cruz,24 petitioner’s complaint for unlawful detainer
merely contained the bare allegations that (1) respondent immediately occupied the subject property after its sale to Petitioner alleged that he is the registered owner of the land; that as owner, he declared 6 the same for tax purposes
her, an action merely tolerated by petitioner; and (2) her allegedly illegal occupation of the premises was by mere and has been up to date in the payments of real property taxes; and that respondents’ occupancy of the property
tolerance. The court, in finding that the alleged tolerance did not justify the action for unlawful detainer, held: was by his mere tolerance but their continued stay became unlawful after he demanded that they vacate the
To justify an action for unlawful detainer, the permission or tolerance must have been present at the beginning of premises.
the possession. x x x
xxxx
In their answer, respondents claimed that they are the owners of 198 square meters each of the disputed land,
In this case, the Complaint and the other pleadings do not recite any averment of fact that would substantiate the
having bought the same from Burgos L. Pangilinan and Reynaldo Pangilinan who were the owners-developers of a
claim of petitioner that it permitted or tolerated the occupation of the property by Respondent Cruz. The complaint
residential subdivision project called "Immaculate Conception Village", and whose ownership was covered by TCT No.
contains only bare allegations that 1) respondent immediately occupied the subject property after its sale to her,
13774.
an action merely tolerated by petitioner; and 2) her allegedly illegal occupation of the premises was by mere
tolerance.
These allegations contradict, rather than support, petitioner’s theory that its cause of action is for unlawful Respondent Militar further claimed that his occupancy of the property could not be by tolerance of petitioner for the
detainer. First, these arguments advance the view that respondent’s occupation of the property was unlawful at its following reasons: one, he constructed his house way back in June 1966, long before petitioner acquired title thereto
inception. Second, they counter the essential requirement in unlawful detainer cases that petitioner’s supposed act on October 10, 1983; two, he bought the one-half portion of the property, consisting of 198 square meters, on April
of sufferance or tolerance must be present right from the start of a possession that is later sought to be 20, 1966 from B.L. Pangilinan & Sons, Inc. and paid for the same in full on October 3, 1973, or 10 years before
recovered.25 petitioner claimed ownership of said property.7 He also assailed the jurisdiction of the Metropolitan Trial Court,
claiming that it had no jurisdiction over the case as the proper action should have been an accion reinvidicatoria filed
before the Regional Trial Court.8
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 Respondent Sones, on the other hand, alleged that she bought the other half of the property from the Spouses
by building their house in the said land thereby depriving petitioners the possession thereof." Nothing has been said Burgos and Juanita Pangilinan on April 6, 1966, and paid for the same in full on October 6, 1973. She also argued
on how respondents’ entry was effected or how and when dispossession started. Admittedly, no express contract that the Metropolitan Trial Court had no jurisdiction over the nature of the action considering that the same is
existed between the parties. This failure of petitioners to allege the key jurisdictional facts constitutive of unlawful founded on a property right. She also averred that petitioner registered the subject property in bad faith inasmuch as

65
he knew that she was in actual, peaceful, exclusive, adverse and continuous possession of the same and was In Tenio-Obsequio v. Court of Appeals,14 it was held that the Torrens System was adopted in this country because it
exercising dominion and ownership over it when petitioner proceeded with his registration. 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.
After trial, the Metropolitan Trial Court rendered a decision in favor of petitioner, thus:
Wherefore, premises considered, judgment is hereby rendered in favor of plaintiff Jacinto Velasco Co and against It is settled that a Torrens Certificate of title is indefeasible and binding upon the whole world unless and until it has
defendants, Rizal Militar and Lilia Sones, as follows: been nullified by a court of competent jurisdiction. Under existing statutory and decisional law, the power to pass
a. ordering the defendants and/or all persons claiming rights under them to vacate the subject premises and upon the validity of such certificate of title at the first instance properly belongs to the Regional Trial Courts in a
peacefully surrender possession thereof to plaintiff; direct proceeding for cancellation of title.15
b. ordering the defendants to pay plaintiff reasonable compensation for the use of the premises in question in the
amount of P500.00 for each defendant per month from June 19, 1997 the date of filing of the complaint until the As the registered owner, petitioner had a right to the possession of the property, which is one of the attributes of his
premises are vacated; ownership. Respondents’ argument that petitioner is not an innocent purchaser for value and was guilty of bad faith
c. ordering the defendants to pay plaintiff the sum of P 2,000.00 as and for attorney’s fees; in having the subject land registered in his name is a collateral attack on the title of petitioner, which is not allowed.
d. to pay the costs of this suit. A certificate of title cannot be subject to a collateral attack and can be altered, modified or cancelled only in a direct
proceeding in accordance with law.16
Respondents appealed the decision to the Regional Trial Court, which reversed and set aside the same.10 Petitioner
filed a petition for review before the Court of Appeals, which denied due course and ordered the dismissal of the WHEREFORE, in view of the foregoing, the instant petition is GRANTED. The June 30, 2000 decision of the Court of
petition. Appeals in CA-G.R. No. 51344 which sustained the October 30, 1998 decision of the Regional Trial Court of Marikina,
Branch 273, in SCA Case No. 98-200-MK is REVERSED and SET ASIDE. The May 26, 1998 decision of the
Petitioner filed a Motion for Reconsideration which was denied by the Court of Appeals. 11 Hence, the instant petition Metropolitan Trial Court of Marikina, Branch 75, in Civil Case No. 97-6521 declaring petitioner Jacinto V. Co as having
raising the following errors: a better right of possession over the subject parcel of land as against respondents Rizal Militar and Lilia Sones is
I. THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN CONCURRING WITH THE FINDING OF THE LOWER REINSTATED.
COURT THAT THE DOCTRINE OF OCCUPANCY BY TOLERANCE, IN AN UNLAWFUL DETAINER CASE, CANNOT BE
VALIDLY INVOKED BY PETITIONER WHO HAD NO PRIOR PHYSICAL POSSESSION OF THE PROPERTY AS HE HAD Accordingly, respondents are ordered to vacate the subject premises and peacefully surrender possession thereof to
BOUGHT THE PROPERTY ONLY IN 1982 VIS-À-VIS THE RESPONDENTS WHO HAD BEEN IN THE PROPERTY SIXTEEN petitioner. Further, respondents are ordered to pay petitioner reasonable compensation for the use of the premises in
(16) YEARS EARLIER OR AS EARLY AS 1966. the amount of P500.00 per month from June 15, 1997 until the premises are vacated; P2,000.00 as attorney’s fees;
II. THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT THE DISPUTE OVER POSSESSION OF and costs of the suit.
THE PROPERTY BY THE PETITIONER AND RESPONDENTS BECOMES AN ISSUE AS TO WHO HAS THE BETTER RIGHT
OF OWNERSHIP, THE RESPONDENTS WHO HAD DEEDS OF SALE AND IN POSSESSION OF THE PREMISES OR THE
PETITIONER WHO ACQUIRED TITLE TO THE PROPERTY IN A FORECLOSURE SALE.

The principal issue to be resolved in the instant petition is: Who between petitioner and respondents has a better
right to possess the subject property?

We have, time and again, held that the only 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 of the party litigants. Moreover,
an ejectment suit is summary in nature and is not susceptible to circumvention by the simple expedient of asserting
ownership over the property.12

In forcible entry and unlawful detainer cases, even if the defendant raises the question of ownership in his pleadings
and the question of possession cannot be resolved without deciding the issue of ownership, the lower courts and the
Court of Appeals, nonetheless, have the undoubted competence to provisionally resolve the issue of ownership for
the sole purpose of determining the issue of possession.13

Such decision, however, does not bind the title or affect the ownership of the land nor is conclusive of the facts
therein found in a case between the same parties upon a different cause of action involving possession.

In the instant case, the evidence showed that as between the parties, it is the petitioner who has a Torrens Title to
the property. Respondents merely showed their unregistered deeds of sale in support of their claims. The
Metropolitan Trial Court correctly relied on the transfer certificate of title in the name of petitioner.

66
 2. THE LOWER COURT ERRED IN ORDERING THE EJECTMENT OF THE DEFENDANTS ALTHOUGH THEY ARE IN
ACTUAL, OPEN, PUBLIC AND NOTORIOUS POSSESSION OF THE LOTS IN DISPUTE UNDER BONAFIDE CLAIM OF
OWNERSHIP EVEN BEFORE THE SECOND WORLD WAR HAVING INHERITED SAID LAND FROM THEIR FATHER LUIS
UNIDA.4 (Underscoring supplied)

By Decision5 dated October 26, 1999, Branch 10 of the RTC of Cagayan reversed the MTC decision, it holding that
although Lucio Cabaddu was given a Special Power of Attorney (SPA) subsequent to the filing of the complaint, the
SPA did not contain a specific authorization for him to institute the complaint.

In any event, the RTC held that the complaint was dismissible for while in its title Lucio Cabaddu appeared as the
G.R. No. 155432               June 9, 2005 representative of the plaintiff-Heirs of Ambrocio Urban, paragraph 1 of the complaint alleged as follows:
1. Plaintiff[,] of legal age, married to Leticia Urban and a resident of Dugo, Camalaniugan, Cagayan, is the
CRISPINA UNIDA, married to ANTONIO MABALOT, NANCY UNIDA, married to EUGENIO UNIDA, EDWIN Authorized representative of the heirs of Ambrocio Urban,6
DAMO, ANDREW MABALOT, RICARDO DAMO and JOCELYN DAMO, Petitioners, thus clearly showing that he "instituted it as plaintiff in behalf of the heirs," hence, "not allowed" as he is not the real
vs. party in interest.
HEIRS OF AMBROSIO URBAN, represented by LUCIO CABADDU, Respondent.
On the substantive issue, the RTC held that since the complaint itself asserted that petitioners’ entry into the
The present petition for review on certiorari originated from a complaint for unlawful detainer filed by respondent, property was unlawful from the very beginning, respondents’ alleged "toleration" thereof cannot be considered as
"Heirs of Ambrocio Urban represented by Lucio Cabaddu," against the defendants-herein petitioners Crispina Unida et toleration in contemplation of law in unlawful detainer cases, hence, the action for unlawful detainer was improper.
al. at the Municipal Trial Court (MTC) of Camalaniugan, Cagayan. Neither was forcible entry the proper remedy, added the RTC, as the entry of petitioners was not by "means of force,
violence, threats, intimidation, stealth or strategy." The RTC suggested though that the remedy of the plaintiff-herein
respondent was to file an accion publiciana or reivindicatoria before the proper RTC.
Since the main issue raised is one of jurisdiction over the subject matter, a recital of the pertinent allegations of the
complaint is in order.
On appeal of respondent to the CA, it assigned two errors of the RTC, to wit:
I. THE APPELLATE COURT ERRED IN FINDING THAT PETITIONERS’ REPRESENTATIVE LUCIO CABADDU LACKS THE
In its March 3, 1998 Complaint, the plaintiff-herein respondent who claims to be the owner of the property, which
PERSONALITY TO SUE DESPITE HIS CONSTITUTION AS AN ATTORNEY-IN-FACT BY PETITIONERS THROUGH A
had been subdivided into Lots 298, 299, and 616, subject of the case alleged that:
VALIDLY EXECUTED SPECIAL POWER OF ATTORNEY.
7. About ten (10) years ago, more or less, without the knowledge or consent of the owners, the defendants[-herein
II. THE APPELLATE COURT ERRED IN REVERSING THE DECISION OF THE MUNICIPAL TRIAL COURT AND
petitioners], without any legal right whatsoever, entered the premises of the land which is the subject of this suit
DISMISSING THE COMPLAINT ON THE GROUND THAT THE MODE OF ACTION (UNLAWFUL DETAINER) TAKEN BY
and cultivated the same as their own, not giving any share to the owners;
THE PETITIONER IS INAPPROPRIATE DESPITE THE ALLEGATIONS IN THE COMPLAINT THAT RESPONDENTS
8. Because the location of the land was then infested by the New People’s Army at the time of the instrusion of the
POSSESSION OVER THE LAND IN DISPUTE WAS ONLY UPON THE MERE TOLERANCE OF THE
defendants, the owners did nothing but to tolerate their (defendants) stay and cultivation over the land in
PETITIONERS.7 (Underscoring supplied)
question;

By Decision promulgated on September 19, 2001,8 the Court of Appeals reversed the decision of the RTC and
In their Answer, the defendants-herein petitioners denied, among other things, having any knowledge or information
reinstated that of the MTC.
sufficient to form a belief regarding the authority of Lucio Cabaddu to represent the plaintiff and concluded that "he
has no right and/or personality to represent the alleged [H]eirs"-plaintiff. On the merits, petitioners asserted that
petitioner Crispina Unida has possessed Lots 298 and 616, and that petitioner Nancy Unida has possessed Lot 299, In reversing the RTC decision, the appellate court held that the subsequent execution of an SPA in favor of Lucio
both in the concept of owner, personally and through their predecessors-in-interest, since time immemorial, and that Cabaddu cured the defect in the filing of the complaint. And the appellate court "agree[d] with the Municipal Trial
the title to the property subject of the complaint, OCT No. P-48306, was fraudulently obtained by respondents.2 Court that [the plaintiff-herein respondent] had established [its] right of possession as owners of the [property]."
Furthermore, the appellate court held that "an allegation that the defendant is unlawfully withholding possession
from the plaintiff is deemed sufficient for one alleging that the withholding of possession or the refusal to vacate is
By Decision3 of June 7, 1999, the MTC, resolving in the affirmative the issues of 1) whether the plaintiff "impliedly
unlawful, without necessarily employing the terminology of the law."
tolerated the defendants’ act of cultivating the land," and 2) whether the plaintiff is the "lawful owner of the land,"
accordingly rendered judgment against the defendants-herein petitioners.
Hence, the present Petition for Review with the following assignments of errors:
a) The Honorable Court of Appeals seriously erred in ruling that the subsequent Special Power of Attorney cures the
On appeal to the Regional Trial Court (RTC), the defendants-herein petitioners raised the following assignment of
defect in the Complaint because such conclusion was grounded entirely on speculation, the inference made is
errors:
manifestly mistaken, and the judgment was based on misapprehension of facts.9
1. THE LOWER COURT ERRED IN NOT DISMISSING THE CASE FOR THERE IS ABSOLUTELY NO EVIDENCE ON
b) The Honorable Court of Appeals erred in not finding that the trial court has no jurisdiction over the unlawful
RECORD SHOWING THE AUTHORITY OF ALLEGED PLAINTIFF LUCIO CABADDU TO INSTITUTE THE PRESENT SUIT;
detainer case because the defendants Crispina Unida and husband Antonio Mabalot and Eugenio Unida married to

67
 Nancy Unida are the owners of the land in dispute having possessed the same since pre-war time and inherited matter, the Regional Trial Court, if it has jurisdiction thereover, shall try the case on the merits as if the case was
said land from their father Luis Unida who owns seventy two (72) hectares before the Second World originally filed with it. In case of reversal, the case shall be remanded for further proceedings.
War.10 (Underscoring supplied) If the case was tried on the merits by the lower court without jurisdiction over the subject matter, the
Regional Trial Court on appeal shall not dismiss the case if it has original jurisdiction thereof, but shall
As stated early on, the main issue, that reflected in herein petitioners’ second assigned error, is one of jurisdiction decide the case in accordance with the preceding section, without prejudice to the admission of
over the complaint of herein respondent. amended pleadings and additional evidence in the interest of justice. (Emphasis and underscoring supplied)

From the earlier quoted material paragraphs-allegations of the complaint, petitioners’ entry into the property was, by WHEREFORE, the petition is GRANTED. The assailed decision of the Court of Appeals is REVERSED and SET ASIDE.
respondent’s own information, unlawful from the very beginning. Respondent, nonetheless, claimed that it merely
tolerated petitioners’ presence in the property. Clearly, an unlawful detainer action does not lie. Let the records of the case be remanded to Branch 10 of the Regional Trial Court of Cagayan which is hereby directed
to take action on it in accordance with the above-quoted provision of Sec. 8 of Rule 40 of the Rules of Court.
For to justify an action for unlawful detainer,
the permission or tolerance must have been present at the beginning of the possession. Otherwise, if the G.R. No. 158231              June 19, 2007
possession was unlawful from the start, an action for unlawful detainer would be an improper remedy. Sarona v.
Villegas elucidates thus: BABY ARLENE LARANO,* Petitioner,
"A close assessment of the law and the concept of the word 'tolerance' confirms our view heretofore expressed vs.
that such tolerance must be present right from the start of possession sought to be recovered, to categorize a SPS. ALFREDO CALENDACION and RAFAELA T. CALENDACION,** Respondents.
cause of action as one of unlawful detainer not of forcible entry…"11 (Emphasis and underscoring supplied)

Before the Court is a Petition for Review on Certiorari under Rule 45 of the Revised Rules of Court assailing the
As correctly held then by the RTC, the case cannot be considered as an unlawful detainer case, the "tolerance" Decision1 dated May 13, 2003 of the Court of Appeals (CA) in CA-G.R. SP No. 68272 which dismissed the complaint
claimed by respondents not being that contemplated by law in unlawful detainer cases; neither can the case be for unlawful detainer of Baby Arlene Laraño (petitioner) against Spouses Alfredo and Rafaela Calendacion
considered as one for forcible entry because the entry of petitioners was not alleged to have been by means of force, (respondents).
intimidation, threats, stealth or strategy.

Petitioner owns a parcel of riceland situated in Barangay Daniw, Municipality of Victoria, Laguna covered by TCT No.
Since the complaint did not satisfy the jurisdictional requirement of a valid cause for unlawful detainer or forcible 175241 of the Register of Deeds of Laguna. On September 14, 1998, petitioner and respondents executed a Contract
entry, the MTC had no jurisdiction over the case. 12 It is in this light that this Court finds that the RTC correctly found to Sell whereby the latter agreed to buy a 50,000-square meter portion of petitioner's riceland for ₱5Million, with
that the MTC had no jurisdiction over the complaint. Parenthetically, it was error for the RTC to find the complaint ₱500,000.00 as down payment and the balance payable in nine installments of ₱500,000.00 each, until September
dismissible also on the ground that Lucio Cabaddu was not the real party in interest. That paragraph 1 of the 2001.2
complaint alleged that "plaintiff [is] of legal age, married to Leticia Urban . . . is the Authorized representative of the
heirs of Ambrocio Urban" did not modify the name of the plaintiff appearing in the title of the complaint. In other
words, that the plaintiff appearing in the title was worded as "Heirs of Ambrocio Urban represented by Lucio Pending full payment of the purchase price, possession of the riceland was transferred to respondents under the
Cabaddu" complied with Section 3 of Rule 3 of the Rules of Court which reads: condition that they shall account for and deliver the harvest from said riceland to petitioner. Respondents, however,
SEC. 3. Representative as parties. –  Where the action is allowed to be prosecuted or defended by a representative failed to pay the installments and to account for and deliver the harvest from said riceland.3
or someone acting in a fiduciary capacity, the beneficiary shall be included in the title of the case and shall be
deemed to be the real party in interest. A representative may be a trustee of an express trust, a guardian, an On March 7, 2000, petitioner sent respondents a demand letter4 to vacate the riceland within 10 days from receipt
executor or administrator, or a party authorized by law or these Rules. An agent acting in his own name and for the thereof, but as her demand went unheeded, she filed on April 5, 2000 a Complaint 5 against respondents for unlawful
benefit of an undisclosed principal may sue or be sued without joining the principal except when the contract detainer before the Municipal Trial Court (MTC), Victoria, Laguna, docketed as Civil Case No. 826, praying that
involves things belonging to the principal. (Underscoring supplied) respondents be directed to vacate the riceland and to pay ₱400,000.00 per year from September 1998 until they
vacate, as reasonable compensation for the use of the property, ₱120,000.00 as attorney’s fees, and ₱50,000.00 as
The foregoing discussion renders it unnecessary to still rule on the first issue of whether the Special Power of litigation expenses.6
Attorney presented by Lucio Cabaddu, the representative of respondent, may be validly considered, it not having
been formally offered in evidence before the MTC. Suffice it to state that, as a rule, documents presented as proof of In their Answer7 dated April 26, 2000, respondents admit the execution of the Contract to Sell but deny that it
a fact in issue must be offered in evidence before a trial court.13 contains all the agreements of the parties. They allege that petitioner has no cause of action against them because
the three-year period within which to pay the purchase price has not yet lapsed; that the MTC has no jurisdiction
A final note. Since the RTC found that the MTC had no jurisdiction over the case, it should have followed the mandate over the case because the complaint failed to allege that a demand to pay and to vacate the riceland was made upon
of Sec. 8, Rule 40, which provides: them.8
Sec. 8. Appeal from orders dismissing case without trial; lack of jurisdiction.  – If an appeal is taken from an order
of the lower court dismissing the case without a trial on the merits, the Regional Trial Court may affirm or reverse On August 2, 2001, the MTC rendered a Decision,9 the dispositive portion of which reads:
it, as the case may be. In case of affirmance and the ground of dismissal is lack of jurisdiction over the subject WHEREFORE, judgment is hereby rendered ordering defendants, as follows:

68
 1.) To immediately vacate the premises in question; The petition is bereft of merit.
2.) To pay the amount of THREE HUNDRED SIXTY FIVE THOUSAND (₱365,000.00) PESOS as a reasonable
compensation for the use and occupation of the property; As to the contention of petitioner that the CA should not have taken cognizance of the petition for review because it
3.) To pay TWENTY THOUSAND (₱20,000.00) PESOS for and attorney's fees; and was not verified, as required by the Rules, this Court has held in a number of instances that such a deficiency can be
4.) To pay FIVE THOUSAND (₱5,000.00) PESOS as litigation expenses, plus costs. excused or dispensed with in meritorious cases, the defect being neither jurisdictional nor always fatal.19 The
requirement regarding verification of a pleading is formal.20 Such requirement is simply a condition affecting the form
Respondents filed an appeal with the Regional Trial Court (RTC), Branch 26, Sta. Cruz, Laguna, docketed as Civil of pleading, the non-compliance with which does not necessarily render the pleading fatally defective. 21 Verification is
Case No. SC-4141.11 On December 3, 2001, the RTC rendered a Decision,12 the dispositive portion of which reads: simply intended to secure an assurance that the allegations in the pleading are true and correct and not the product
WHEREFORE, the judgment of the trial court is hereby affirmed subject to the modification that defendants are of the imagination or a matter of speculation, and that the pleading is filed in good faith. 22 The court may order the
ordered to pay plaintiff the amount of FOUR HUNDRED THOUSAND (₱400,000.00), as yearly reasonable correction of the pleading if verification is lacking or act on the pleading although it is not verified, if the attending
compensation for the use and occupation of said riceland computed from 1999 until such time that defendants have circumstances are such that strict compliance with the Rules may be dispensed with in order that the ends of justice
actually vacated the same. may thereby be served.23

Undaunted, respondents filed a Petition for Review with the CA.14 For failure to file her comment despite receipt of CA Besides, petitioner did not raise the issue of lack of verification before the CA. She did not file a comment to the
Resolution15 dated May 8, 2002 which required her to file a comment, petitioner was deemed to have waived her petition and it is too late in the day to assail such defect, as she is deemed to have waived any objection to the
right to file comment to the petition in CA Resolution dated August 28, 2002.16 formal flaws of the petition. Points of law, theories, issues and arguments not brought to the attention of the lower
court cannot be raised for the first time on appeal.24
On May 13, 2003, the CA rendered a Decision17 setting aside the Decision of the RTC and dismissing the complaint
for unlawful detainer. The CA nullified the proceedings before the MTC for want of jurisdiction. It held that the issues The main issue being raised in the present petition is whether the complaint is one for unlawful detainer.
in the case - whether or not there was a violation of the Contract to Sell, whether or not such violation gives the
petitioner the right to terminate the contract and consequently, the right to recover possession and the value of the Settled is the rule that jurisdiction in ejectment cases is determined by the allegations pleaded in the complaint. 25 It
harvest from the riceland - extend beyond those commonly involved in unlawful detainer suits where only the issue cannot be made to depend upon the defenses set up in the answer or pleadings filed by the defendant. 26 Neither can
of possession is involved; that the case is not a mere detainer suit but one incapable of pecuniary estimation, placing it be made to depend on the exclusive characterization of the case by one of the parties. 27 The test for determining
it under the exclusive original jurisdiction of the RTC, not the MTC. the sufficiency of those allegations is whether, admitting the facts alleged, the court can render a valid judgment in
accordance with the prayer of the plaintiff.28
Dissatisfied, petitioner filed the present petition anchored on the following grounds:
1. The respondent Court of Appeals committed grave error in giving due course to the private respondents' petition The facts upon which an action for unlawful detainer can be brought are specially mentioned in Section 1, Rule 70 of
for review notwithstanding the fact that said petition contains no verification to the effect that the allegations the Revised Rules of Court, which provides:
therein were read and understood by the private respondents and that they are true and correct of their own or Section 1. Who may institute proceedings, and when. – Subject to the provisions of the next succeeding section, a
personal knowledge or based on authentic records, as required by the rules. person deprived of the possession of any land or building by force, intimidation, threat, strategy, or stealth, or a
2. The respondent Court of Appeals grievously erred in dismissing the case on the ground that the Municipal Trial lessor, vendor, vendee, or other person against whom the possession of any land or building is unlawfully withheld
Court has no jurisdiction over the case for unlawful detainer, and thus the Regional Trial Court likewise has no after the expiration or termination of the right to hold possession, by virtue of any contract, express or implied, or
jurisdiction on appeal to decide the case for unlawful detainer, which allegedly involves a matter incapable of the legal representatives or assigns of any such lessor, vendor, vendee or other person may, at any time within
pecuniary estimation. one (1) year after such unlawful deprivation or withholding of possession, bring an action in the proper Municipal
3. The respondent Court of Appeals erred in not affirming the decision of the Regional Trial Court dated December Trial Court against the person or persons unlawfully withholding or depriving of possession, or any person or
3, 2001, modifying the decision of the Municipal Trial Court dated August 2, 2000 both ordering the eviction of persons claiming under them, for the restitution of such possession, together with damages and costs. (Emphasis
private respondents from the subject property and payment of the reasonable value of the use of the subject supplied)
premises.18

In unlawful detainer, the possession was originally lawful but became unlawful by the expiration or termination of the
Petitioner contends that the CA should have dismissed outright the petition for review filed before it since it contains right to possess; hence, the issue of rightful possession is decisive for, in such action, the defendant is in actual
no verification as required by the Rules; and that the CA, in finding that the complaint before the MTC was not one possession and the plaintiff’s cause of action is the termination of the defendant’s right to continue in possession.29
for unlawful detainer but for specific performance, did not limit itself to the allegations in the complaint but resorted
to unrestrained references, deductions and/or conjectures, unduly influenced by the allegations in the answer.
Applied to the present case, petitioner, as vendor, must comply with two requisites for the purpose of bringing an
ejectment suit: (a) there must be failure to pay the installment due or comply with the conditions of the Contract to
Respondents, on the other hand, contend that verification is just a formal requirement; that petitioner waived her Sell; and (b) there must be demand both to pay or to comply and vacate within the periods specified in Section 2 30 of
right to question the defect when she failed to submit her comment; that the CA correctly pointed out that the Rule 70, namely: 15 days in case of land and 5 days in case of buildings. The first requisite refers to the existence of
present case involves one that is incapable of pecuniary estimation since the crux of the matter is the rights of the the cause of action for unlawful detainer, while the second refers to the jurisdiction requirement of demand in order
parties based on the Contract to Sell. that said cause of action may be pursued.31

69
Both demands – to pay installment due or adhere to the terms of the Contract to Sell and to vacate are necessary to
make the vendee deforciant in order that an ejectment suit may be filed. 32 It is the vendor's demand for the vendee
to vacate the premises and the vendee's refusal to do so which makes unlawful the withholding of the
possession.33 Such refusal violates the vendor's right of possession giving rise to an action for unlawful
detainer.34 However, prior to the institution of such action, a demand from the vendor to pay the installment due or
comply with the conditions of the Contract to Sell and to vacate the premises is required under the aforequoted rule.

Thus, mere failure to pay the installment due or violation of the terms of the Contract to Sell does not automatically
render a person's possession unlawful. Furthermore, the giving of such demand must be alleged in the complaint;
otherwise, the MTC cannot acquire jurisdiction over the case.35

A review of the Complaint of petitioner discloses these pertinent allegations: petitioner owns the subject riceland; she
executed a Contract to Sell in favor of respondents; pending full payment of the purchase price, possession of
subject riceland was transferred to respondents subject to accounting and delivery of the harvest to petitioner;
respondents failed to pay the installments and to account for and deliver the harvest; petitioner asked respondents
to vacate the subject riceland, but they failed to do so. Accordingly, petitioner prayed for judgment ordering G.R. No. 204926               December 3, 2014
respondents to vacate the subject riceland and to pay ₱400,000.00 per year from September 1998 until they vacate
as reasonable compensation for the use of the property, ₱120,000.00 as attorney's fees, and ₱50,000.00 as litigation
ANACLETO C. MANGASER, represented by his Attorney-in-fact EUSTAQUIO DUGENIA, Petitioner,
expenses.
vs.
DIONISIO UGAY, Respondent.
It is clear from the foregoing that the allegations in the Complaint failed to constitute a case of unlawful detainer.
What is clear is that in the Complaint, petitioner alleged that respondents had violated the terms of the Contract to
This is a petition for review on certiorari seeking to reverse and set aside the June 13, 2012 Decision1 and the
Sell. However, the Complaint failed to state that petitioner made demands upon respondents to comply with the
December 5, 2012 Resolution2 of the Court of Appeals (CA) in CA-G.R. SP No. 122153, entitled "Dionisio Ugay v.
conditions of the contract – the payment of the installments and the accounting and delivery of the harvests from the
Anacleto C. Mangaser, represented by his Attorney-in-fact Eustaquio Dugenia, "a case of forcible entry and damages.
subject riceland. The 10-day period granted respondents to vacate even fell short of the 15-day period mandated by
law. When the complaint does not satisfy the jurisdictional requirements of a valid cause for unlawful detainer, the
MTC does not have jurisdiction to hear the case.36 On October 30, 2007, petitioner Anacleto Mangaser, represented by his attorney-in-fact, Eustaquio Dugenia
(petitioner), filed a complaint for Forcible Entry with Damages against respondent Dionisio Ugay (respondent) before
the Municipal Trial Court of Caba, La Union (MTC). In his complaint, petitioner alleged that he was the registered
An allegation of a violation of a contract or agreement in a detainer suit may be proved by the presentation of
owner and possessor of a parcel of land situated in Santiago Sur, Caba, La Union, with an area of 10,632 square
competent evidence, upon which an MTC judge might make a finding to that effect, but certainly, that court cannot
meters and covered by OCT No. RP-174 (FP-13 787) and Tax Declaration No. 014-00707; that on October 31, 2006,
declare and hold that the contract is rescinded. The rescission of contract is a power vested in the RTC. 37 The
petitioner, discovered that respondent stealthy intruded and occupied a portion of his property by constructing a
rescission of the contract is the basis of, and therefore a condition precedent for, the illegality of a party's possession
residential house thereon without his knowledge and consent; that he referred the matter to the Office of Lupong
of a piece of realty.38 Without judicial intervention and determination, even a stipulation entitling one party to take
Tagapamayapa for conciliation, but no settlement was reached, hence, a certification to file action was issued by the
possession of the land and building, in case the other party violates the contract, cannot confer upon the former the
Lupon; and that demand letters were sent to respondent but he still refused to vacate the premises, thus, he was
right to take possession thereof, if that move is objected to.39
constrained to seek judicial remedy.3

Clearly, the basic issue raised in the complaint of petitioner is not of possession but interpretation, enforcement
Respondent denied the material allegations of the complaint and put up the following defenses, to wit: that he had
and/or rescission of the contract, a matter that is beyond the jurisdiction of the MTC to hear and determine.
been a resident of Samara, Aringay, La Union, since birth and when he reached the age of reason, he started
occupying a parcel of land in that place then known as Sta. Lucia, Aringay, La Union; that years later, this parcel of
WHEREFORE, the instant petition is DENIED. The Decision dated May 13, 2003 of the Court of Appeals in CA-G.R. land was designated as part of Santiago Sur, Caba, La Union due to a survey made by the government; that he
SP No. 68272 is AFFIRMED. Costs against petitioner. introduced more improvements on the property by cultivating the land, and in March 2006, he put up a "bahay
kubo"; that in October 2006, he installed a fence made of "bolo" to secure the property; that in installing the fence,
he was guided by the concrete monuments which he knew to be indicators of the boundaries of petitioner's property;
that while he could not locate some of the monuments, he based the boundaries on his recollection since he was
around when these were installed; that he knew the boundaries of petitioner's property because he knew the extent
of the "iron mining" activities done by a company on the said property; that petitioner was never in actual possession
of the property occupied by him, and it was only on October 31, 2006 when he discovered the al legccl intrusion; that
it was not correct to say that he refused to vacate and surrender the premises despite receipt of the demand letters
because in his letter-reply, he assured petitioner that he would voluntarily vacate the premises if he would only be

70
shown to have intruded into petitioner's titled lot after the boundaries were pointed out to him; and that instead of possession was contemplated in forcible entry cases. In other words, physical possession was the crux in forcible
shmving the boundaries to him, petitioner filed an action for forcible entry before the MTC.4 entry, not possession that stemmed upon ownership.17 The dispositive portion of the assailed decision reads:
WHEREFORE, premises considered, the Petition for Review is GRANTED, accordingly, the Decision dated August 23,
MTC Ruling 2011 and Order dated October 25, 2011, of the RTC Branch 33, Bauang, La Union in Civil Case No. 2029-BG are
REVERSED and SET ASIDE. The Decision of the MTC dated April 26, 2011 is hereby REINSTATED.

On April 26, 2011, the MTC ruled in favor of respondent. It stated that petitioner failed to adduce any evidence to
prove that the lot occupied by respondent was within his lot titled under OCT No. RP-174 (13 789). The MTC opined Petitioner filed a motion for reconsideration, 19 dated July 6, 2012, but it was subsequently denied by the CA in a
that petitioner could have presented a relocation survey, which would have pinpointed the exact location of the house Resolution,20 dated December 5, 2012. It reads:
and fence put up by respondent, and resolved the issue once and for all. 6 It also explained that petitioner failed to This Court, after a meticulous study of the arguments set forth in the Motion for Reconsideration filed by
prove his prior physical possession of the subject property. The OCT No. RP-174(13789) registered under petitioner's respondent, finds no cogent reason to revise, amend, much less reverse, the assailed Decision dated June 13,
name and the Tax Declaration were not proof of actual possession of the property. The dispositive portion of which 2012. The Motion for Reconsideration is, thus, DENIED
reads:
WHEREFORE, the plaintiff (petitioner) having failed to establish his case by preponderance of evidence, the Hence, this petition, anchored on the following
complaint is hereby DISMISSED.7
STATEMENT OF ISSUES
RTC Ruling I WHETHER OR NOT THE COURT OF APPEALS FAILED TO CONSIDER THE EVIDENCE OF OWNERSHIP OF
PETITIONER WHICH MAY ESTABLISH PRIOR POSSESSION OVER THE PROPERTY BY HEREIN PETITIONER.
Aggrieved, petitioner appealed to the Regional Trial Court of Bauang, La Union (RTC) and the case was raffled to II WHETHER OR NOT THE RESOLUTION DATED DECEMBER 5, 2012 OF THE COURT OF APPEALS, FORMER SPECIAL
Branch 33. FOURTH DIVISION, DENYING THE MOTION FOR RECONSIDERATION IS VALID.22

In its August 23, 2011 Decision,8 the RTC reversed the MTC decision and ruled in favor of petitioner. It relied on the Petitioner argues that in ejectment cases, possession of the land does not only mean actual or physical possession or
cases of Barba v. Court of Appeals9 and Nunez v. SLTEAS Phoenix Solutions, Inc.,10 which held that in ejectment occupation but also by the fact that a land is subject to the action of one's will or by proper acts and legal formalities
cases, possession of the land did not only mean actual or physical possession but also included the subject of the established for acquiring such right; that the CA should have considered OCT No. RP-174(13789) his tax declaration
thing to the action of one's will or by the proper acts and legal formalities established for acquiring such right. The as proofs of prior physical possession over the property; and that the issuance of the same are considered to by law
RTC stated that petitioner had clearly shown his possession of the property as evidenced by his OCT No. RP-174(13 as proper acts and legal formalities established for acquiring such right. Petitioner cited Tolentino, as one of the
789) issued in March 1987 and tax declaration, dating back as early as 1995. 11 It added that the boundaries of the authors and experts in Civil law, stating that the "proper acts and formalities" refer to juridical acts, or the acquisition
property were clearly indicated in the title, thus, there was no need to conduct a survey. As the owner, petitioner of possession by sufficient title, inter vivas or mortis causa, onerous or lucrative. These are the acts which the law
knew the exact metes and bounds of his property so that when respondent intruded stealthily, he filed the subject gives the force of acts of possession.
suit.12 The dispositive portion of the RTC decision reads:
WHEREFORE, after a thorough perusal of the facts and evidence in this case, this Court reverses the decision of the Petitioner also avers that the December 5, 2012 CA Resolution was not valid as it did not state the legal basis
MTC, Caba, La Union, dated April 26, 2011 and rules in favor of plaintiffappellant (petitioner) and against required by the Constitution.
defendant-appellee (respondent), ordering the latter and all other persons claiming rights under him to:
1. VACATE the portion of the subject property encroached by him; On May 28, 2013, respondent filed his Comment23 before this Court. He stated that the issues raised and the
2. SURRENDER actual physical possession of the subject portion peacefully to plaintiff-appellant; arguments presented by petitioner have been thoroughly resolved and ruled upon by the CA. The appellate court did
3. REMOVE all the improvements he introduced therein; not err in reversing the RTC decision because petitioner was never in prior physical possession of the property in
4. PAY attorney's fees in the amount Php20,000.00 to plaintiff-appellant, and pay the cost of suit. dispute. Respondent asserts that he has been in prior, actual, continuous, public, notorious, exclusive and peaceful
possession in the concept of an owner of the property in dispute.24
Undaunted, respondent appealed to the CA.
On March 28, 2014, petitioner filed his Reply,25 reiterating the case of Nunez v. SLTEAS Phoenix Solutions,
CA Ruling Inc.,26 where a party was able to demonstrate that it had exercised acts of ownership over the property by having it
titled in its name and by paying real property taxes on it. Petitioner also laments the wrongful insistence of
The CA reversed and set aside the decision of the RTC. Citing Quizon v. Juan, 14 it emphasized that petitioner must respondent that his possession over the property was one in the concept of an owner. To petitioner's mind,
allege and prove that he was in prior physical possession of the property in dispute. The word "possession," as used respondent failed to adequately adduce evidence to show proof of his right to possess the property when his
in forcible entry and unlawful detainer cases, meant nothing more than physical possession, not legal possession in possession came under attack with the filing of the subject case.27
the sense contemplated in civil law. The CA wrote that petitioner was not in physical possession despite the
presentation of the OCT No. RP-174(13789) and his tax declarations. 15 It reiterated that when the law would speak of The Court's Ruling
possession in forcible entry cases, it is prior physical possession or possession de facto, as distinguished from
possession de Jure. What petitioner proved was legal possession, not his prior physical possession. Furthermore, the The Court finds the petition meritorious.
CA stated that the RTC misquoted Nunez v. SLTEAS Pheonix Solutions16 by giving the wrong notion of what kind of

71
For a forcible entry suit to prosper, the plaintiffs must allege and prove: (a) that they have prior physical possession entry. One of the issues raised therein was whether respondent DMC had prior possession of the subject property, to
of the property; (b) that they were deprived of possession either by force, intimidation, threat, strategy or stealth; which the Court answered in the affirmative. It ruled that:
and, (c) that the action was filed within one (1) year from the time the owners or legal possessors learned of their
deprivation of the physical possession of the property.28 Prior possession of the lot by respondent's predecessor was sufficiently proven by evidence of the execution and
registration of public instruments and by the fact that the lot was subject to its will from then until December 1,
There is only one issue in ejectment proceedings: who is entitled to physical or material possession of the premises, 1993, when petitioner unlawfully entered the premises and deprived the former of possession thereof.
that is, to possession de facto, not possession de Jure? Issues as to the right of possession or ownership are not
involved in the action; evidence thereon is not admissible, except only for the purpose of determining the issue of In the case at bench, the Court finds that pet1t1oner acquired possession of the subject property by juridical act,
possession.29 specifically, through the issuance of a free patent under Commonwealth Act No. 141 and its subsequent registration
with the Register of Deeds on March 18, 1987.38
As a rule, the word "possession" in forcible entry suits indeed refers to nothing more than prior physical possession
or possession de facto, not possession de Jure or legal possession in the sense contemplated in civil law. Title is not Before the Court continues any further, it must be determined first whether the issue of ownership is material and
the issue, and the absence of it "is not a ground for the courts to withhold relief from the parties in an ejectment relevant in resolving the issue of possession. The Rules of Court in fact expressly allow this: Section 16, Rule 70 of
case."30 the Rules of Court provides that the issue of ownership shall be resolved in deciding the issue of possession if the
question of possession is intertwined with the issue of ownership. But this provision is only an exception and is
The Court, however, has consistently ruled in a number of cases31 that while prior physical possession is an allowed only in this limited instance - to determine the issue of possession and only if the question of possession
indispensable requirement in forcible entry cases, the dearth of merit in respondent's position is evident from the cannot be resolved without deciding the issue of ownership.39
principle that possession can be acquired not only by material occupation, but also by the fact that a thing is subject
to the action of one's will or by the proper acts and legal formalities established for acquiring such right. The case of This Court is of the strong view that the issue of ownership should be provisionally determined in this case. First, the
Quizon v. Juan,32 which surprisingly was relied on by the CA, also stressed this doctrine. juridical act from which the right of ownership of petitioner arise would be the registration of the free patent and the
issuance of OCT No. RP-174(13789). Apparently, the Torrens title suggests ownership over the land. Second,
Possession can be acquired by juridical acts. These are acts to which the law gives the force of acts of possession. respondent also asserts ownership over the land based on his prior, actual, continuous, public, notorious, exclusive
Examples of these are donations, succession, execution and registration of public instruments, inscription of and peaceful possession in the concept of an owner of the property in dispute.40 Because there are conflicting claims
possessory information titles and the like.33 The reason for this exceptional rule is that possession in the eyes of the of ownership, then it is proper to provisionally determine the issue of ownership to settle the issue of possession de
law does not mean that a man has to have his feet on every square meter of ground before it can be said that he is facto.
in possession.34 It is sufficient that petitioner was able to subject the property to the action of his will.35 Here,
respondent failed to show that he falls under any of these circumstances. He could not even say that the subject Returning to the case, this Court cannot agree with the CA that petitioner's OCT No. RP-174(13789) and his tax
property was leased to him except that he promised that he would vacate it if petitioner would be able to show the declarations should absolutely be disregarded. The issuance of an original certificate of title to the petitioner
boundaries of the titled lot. evidences ownership and from it, a right to the possession of the property flows. Well-entrenched is the rule that a
person who has a Torrens title over the property is entitled to the possession thereof.41
In the case of Nunez v. SLTEAS Phoenix Solutions, inc., 36 the subject parcel was acquired by the respondent by
virtue of the June 4, 1999 Deed of Assignment executed in its favor by Spouses Ong Tiko and Emerenciana Moreover, his claim of possession is coupled with tax declarations. While tax declarations are not conclusive proof of
Sylianteng. The petitioner in the said case argued that, aside from the admission in the complaint that the subject possession of a parcel of land, they are good indicia of possession in the concept of an owner, for no one in his right
parcel was left idle and unguarded, the respondent's claim of prior possession was clearly negated by the fact that he mind would be paying taxes for a property that is not in his actual or constructive possession. 42 Together with the
had been in occupancy thereof since 1999. The Court disagreed with the petitioner and said: Although it did not Torrens title, the tax declarations dated 1995 onwards presented by petitioner strengthens his claim of possession
immediately put the same to active use, respondent appears to have additionally caused the property to be over the land before his dispossession on October 31, 2006 by respondent.
registered in its name as of February 27, 2002 and to have paid the real property taxes due thereon alongside the
sundry expenses incidental thereto. Viewed in the light of the foregoing juridical acts, it consequently did not matter
that, by the time respondent conducted its ocular inspection in October 2003, petitioner hml already been occupying The CA was in error in citing the case of De Grano v. Lacaba43 to support its ruling. In that case, the respondent tried
the land since 1999. to prove prior possession, by presenting only his tax declarations, tax receipt and a certification from the municipal
assessor attesting that he had paid real property tax from previous years. The Court did not give credence to his
claim because tax declarations and realty tax payments are not conclusive proof of possession. The situation in the
Hence, in that case, the Court ruled that such juridical acts were sufficient to establish the respondent's prior present case differs because aside from presenting his tax declarations, the petitioner submitted OCT No. RP-174(13
possession of the subject property. 789) which is the best evidence of ownership from where his right to possession arises.

The case of Habagat Grill v. DMC-Urban Property Developer, Inc., 37 also involves an action for forcible entry. On June Against the Torrens title and tax declarations of petitioner, the bare allegations of respondent that he had prior,
11, 1981, David M. Consunji, Inc. acquired a residential lot situated in Matin a, Davao City, which was covered by actual, continuous, public, notorious, exclusive and peaceful possession in the concept of an owner, has no leg to
TCT No. T-82338. On June 13, 1981, it transferred the said lot to respondent DMC. Alleging that the petitioner stand on. Thus, by provisionally resolving the issue of ownership, the Court is satisfied that petitioner had prior
forcibly entered the property in December 1993, the respondent filed on March 28, 1994 a complaint for forcible possession of the subject property. When petitioner discovered the stealthy intrusion of respondent over his
registered prope1iy, he immediately filed a complaint with the Lupong Tagapamayapa and subsequently filed an

72
action for forcible entry with the MTC. Instead of taking the law into his own hands and forcefully expelling
respondent from his property, petitioner composed himself and followed the established legal procedure to regain
possession of his land.

If the Court were to follow the ruling of the CA and disregard juridical acts to obtain prior possession, then it would
create an absurd situation. It would be putting premium in favor of land intruders against Torrens title holders, who
spent months, or even years, in order to register their land, and who religiously paid real property taxes thereon.
They cannot immediately repossess their properties simply because they have to prove their literal and physical
possession of their property prior to the controversy. The Torrens title holders would have to resort to ordinary civil
procedure by filing either an accion publiciana or accion reinvidicatoria and undergo arduous and protracted litigation
while the intruders continuously enjoy and rip the benefits of another man's land. It will defeat the very purpose of
the summary procedure of an action for forcible entry.

The underlying philosophy behind ejectment suits is to prevent breach of the peace and criminal disorder and to
compel the party out of possession to respect and resort to the law alone to obtain what he claims is his. Ejectment
proceedings are summary in nature so the authorities can speedily settle actions to recover possession because of
the overriding need to quell social disturbances.44

As to the other requirements of an action for forcible entry, the Court agrees with the RTC that petitioner had
sufficiently complied with them. Petitioner proved that he was deprived of possession of the property by
stealth.1âwphi1 The complaint was also filed on October 30, 2007, within the one year reglementary period counted G.R. No. 156995               January 12, 2015
from the discovery of the stealthy entry by respondent to the property on October 31, 2006.

RUBEN MANALANG, CARLOS MANALANG, CONCEPCION GONZALES AND LUIS MANALANG, Petitioners,

The second issue raised is the validity of the CA Resolution dated December 5, 2012. Petitioner alleges that the CA vs.
denied his reconsideration without indicating its legal basis in violation of the mandate of Section 14, Article VIII of BIENVENIDO AND MERCEDES BACANI, Respondents.
the Constitution, which provides that no petition for review or motion for reconsideration of a decision of the court
shall be refused due course or denied without stating the legal basis therefor. This requirement, however, was
In the exercise of its appellate jurisdiction, the Regional Trial Court (RTC) shall decide the appeal of the judgment of
complied with when the CA, in its resolution denying petitioner's motion for reconsideration, stated that it "finds no
the Municipal Trial Court (MTC) in unlawful detainer or forcible entry cases on the basis of the entire record of the
cogent reason to reverse, amend, much less reverse the assailed Decision, dated June 13, 2012."45
proceedings had in the court of origin and such memoranda and/or briefs as may be required by the RTC. There is no
trial de nova of the case.
WHEREFORE, the petition is GRANTED. The June 13, 2012 Decision and the December 5, 2012 Resolution of the
Court of Appeals in CA-G.R. SP No. 122153 are hereby REVERSED and SET ASIDE. The August 23, 2011 Decision of
The petitioners assail the decision promulgated on October 18, 2002 in CA-G.R. SP No. 68419, 1 whereby the Court of Appeals (CA)
the Regional Trial Court, Branch 33, Bauang, La Union, is hereby REINSTATED. reversed and set aside the decision of the RTC, Branch 49, in Guagua, Pampanga, and reinstated the judgment rendered on August 31,
2000 by the MTC of Guagua, Pampanga dismissing their complaint for unlawful detainer and the respondents’ counterclaim. They also
hereby assail the resolution promulgated on January 24, 2003 denying their motion for reconsideration.2

Petitioners Ruben Manalang, Amado Manalang, Carlos Manalang, Concepcion M. Gonzales, Ladislao Manalang and
Luis Manalang were the co-owners of Lot No 4236 with an area of 914 square meters of the Guagua Cadastre, and
declared for taxation purposes in the name of Tomasa B. Garcia. The land was covered by approved survey plan Ap-
03-004154. Adjacent to Lot 4236 was the respondents’ Lot No. 4235 covered by Original Certificate of Title (OCT)
No. N-216701. In 1997, the petitioners caused the relocation and verification survey of Lot 4236 and the adjoining
lots, and the result showed that the respondents had encroached on Lot No. 4236 to the extent of 405 square
meters. A preliminary relocation survey conducted by the Lands Management Section of the Department of
Environment and Natural Resources (DENR) confirmed the result on the encroachment. When the respondents
refused to vacate the encroached portion and to surrender peaceful possession thereof despite demands, the
petitioners commenced this action for unlawful detainer on April 21, 1997 in the MTC of Guagua (Civil Case No.
3309), and the casewas assigned to Branch 2 of that court.3

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On September 17, 1998, the MTC (Branch 2) dismissed Civil Case No. 3309 for lack of jurisdiction based onits finding there was an encroachment based on such survey and testimony of the surveyor, had acted as a trial court in
that the action involved an essentially boundary dispute that should be properly resolved in an accion complete disregard of the second paragraph of Section 18, Rule 70 of the Rules of Court. It declared such action by
reivindicatoria.4 It stated that the complaint did not aver any contract, whether express or implied, between the the RTC as unwarranted because it amounted to the reopening of the trial, which was not allowed under Section
petitioners and the respondents that qualified the case as one for unlawful detainer; and that there was also no 13(3) Rule 70 of the Rules of Court. It observed that the relocation and verification survey was inconclusive
showing that the respondents were in possession of the disputed area by the mere tolerance of the petitioners due to inasmuch as the surveyor had himself admitted that he could not determine which of the three survey plans he had
the latter having become aware of the encroachment only after the relocation survey held in 1997. used was correct without a full-blown trial.

On appeal, however, the RTC reversed the MTC (Branch 2), and remanded the case for further proceedings,5 holding The CA held that considering that the petitioners’ complaint for unlawful detainer did not set forth when and how the
that because there was an apparent withholding of possession of the property and the action was brought within one respondents had entered the land in question and constructed their houses thereon, jurisdiction did not vest in the
year from such withholding of possession the proper action was ejectment which was within the jurisdiction of the MTC totry and decide the case; that the complaint, if at all, made out a case for either accion reivindicatoria or accion
MTC; and that the case was not a boundary dispute that could be resolved in an accion reinvidicatoria, considering publiciana, either of which fell within the original jurisdiction of the RTC; and that the RTC’s reliance on Benitez v.
that it involved a sizeable area of property and not a mere transferring of boundary.6 Court of Appeals16 and Calubayan v. Ferrer17 was misplaced, because the controlling ruling was that in Sarmiento v.
Court of Appeals,18 in which the complaint was markedly similar to that filed in the case.
Upon remand, the MTC, Branch 1,7 ultimately dismissed the complaint and counterclaim for lack ofmerit through the
decision rendered on August 31, 2000,8 ruling that the petitioners failed to adduce clear and convincing evidence The petitioners sought reconsideration, but the CA denied their motion for its lack of merit in the resolution of
showing that the respondents had encroached on their property and had been occupying and possessing property January 24, 2003.19
outside the metes and bounds described in Bienvenido Bacani’s OCT No. N-216701; that the preponderance of
evidence was in favor of the respondents’ right of possession; and that the respondent’s counterclaim for damages Hence, this appeal.
should also be dismissed, there being no showing that the complaint had been filed in gross and evident bad faith.9

The petitioners contend that the RTC had authority to receive additional evidence on appeal in anejectment case
Once more, the petitioners appealed to the RTC. because it was not absolutely confined to the records of the trial in resolving the appeal; that the respondents were
estopped from assailing the relocation and verification survey ordered by the RTC because they had actively
At that point, the RTC ordered the petitioners to conduct a relocation survey to determine their allegation of participated in the survey and had even cross-examined Engr. Limpin, the surveyor tasked to conduct the
encroachment, and also heard the testimony of the surveyor, Engr. Emmanuel Limpin, then Acting Chief of the survey;20 that Engr. Limpin’s testimony must be given credence, honoring the well-entrenched principle of regularity
Survey Section of the CENR- DENR. in the performance of official functions; 21 that the RTC did not conduct a trial de novoby ordering the relocation and
verification surveyand hearing the testimony of the surveyor; that the desirability of the relocation and verification
On September 19, 2001,10 the RTC rendered its judgment whereby it reversed and set aside the MTC’s decision of survey had always been part of the proceedings even before the case was appealed to the RTC; 22 that, in any case,
August 31, 2000, observing that the respondents had encroached on the petitioners’ property based on the court- the peculiar events that transpired justified the RTC’s order to conduct a relocation and verification survey;23 that the
ordered relocation survey, the reports by Engr. Limpin, and his testimony; 11 that the respondents could not rely on case, because it involved encroachment into another’s property, qualified as an ejectment case that was within the
their OCT No. N-216701, considering that although their title covered only 481 squaremeters, the relocation survey jurisdiction of the MTC; and that the respondents were barred by laches for never questioning the RTC’s February 11,
revealed that they had occupied also 560 square meters of the petitioners’ Lot No. 4236; 12 that the petitioners did 1999 ruling on the issue of jurisdiction.24
not substantiate their claims for reasonable compensation, attorney’s fees and litigation expenses; and that,
nevertheless, after it had been established that the respondents had encroached upon and used a portion of the In contrast, the respondents assail the relocation and verification survey ordered by the RTC as immaterial, because
petitioners’ property, the latter were entitled to ₱1,000.00/month as reasonable compensation from the filing of the (a) it could not vest a right of possession or ownership; (b) the petitioners were mere claimants, not the owners of
complaint up to time that the respondents actually vacated the encroached property, plus ₱20,000.00 attorney’s the property; (c) the petitioner had never been in possession of the area in question; and (d) cadastral surveys were
fees.13 not reliable. Hence, they maintain that whether or not the relocation and verification survey was considered would
not alter the outcome of the case.25
The respondents moved for reconsideration, but the RTC denied their motion for its lack of merit.14
Ruling of the Court
The respondents appealed.
The appeal has no merit.
On October 18, 2002, the CA promulgated its assailed decision,15 viz:
WHEREFORE, the appealed RTC decision is hereby REVERSED and SET ASIDE, and the decisions of the MTC of To start with, the RTC, in an appeal of the judgment in an ejectment case, shall not conduct a rehearing or trial de
Guagua, Pampanga, Branches 1 and 2, are REINSTATED. novo.26 In this connection, Section 18, Rule 70 of the Rules of Courtclearly provides:
No pronouncement as to costs. Sec. 18. Judgment conclusive only on possession; not conclusive in actions involving title or ownership. — x x x.
The judgment or final order shall be appealable to the appropriate Regional Trial Court which shall decide the same
The CA concluded that the RTC,by ordering the relocation and verification survey "in aid of its appellate jurisdiction" on the basis of the entire record of the proceedings had in the court of origin and such memoranda and/or briefs as
upon motion of the petitioners and over the objection of the respondents, and making a determination of whether may be submitted by the parties or required by the Regional Trial Court. (7a)

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Hence, the RTC violated the foregoing rule by ordering the conduct of the relocation and verification survey "in aid of of his right of possession. In forcible entry, the possession of the defendant is illegal from the very beginning, and
its appellate jurisdiction" and by hearing the testimony of the surveyor, for its doing so was tantamount to its holding the issue centers on which between the plaintiff and the defendant had the prior possession de facto.
of a trial de novo. The violation was accented by the fact that the RTC ultimately decided the appeal based on the
survey and the surveyor’s testimony instead of the record of the proceedings had in the court of origin. Secondly, on Thirdly, the MTC dismissed the action because it did not have jurisdiction over the case. The dismissal was correct. It
whether or not Civil Case No. 3309 was an ejectment case within the original and exclusive jurisdiction of the MTC, is fundamental that the allegations of the complaint and the character of the relief sought by the complaint determine
decisive are the allegations of the complaint. Accordingly, the pertinent allegations of the petitioners’ complaint the nature of the action and the court that has jurisdiction over the action. 28 To be clear, unlawful detainer is an
follow: action filed by a lessor, vendor, vendee, or other person against whom the possession of any land or building is
2. Plaintiffs are co-owners ofland known as Lot no. 4236 of the Guagua cadastre. Plaintiffs inherited the said parcel unlawfully withheld after the expiration or termination of the right to hold possession by virtue of any contract,
of residential land from Tomasa B. Garcia-Manalang who is the absolute owner of the said property and the same is express or implied.29 To vest in the MTC the jurisdiction to effect the ejectment from the land of the respondents as
declared for taxation purposes in her name under Tax Declaration No. 07014906, a copy of which is hereto the occupants in unlawful detainer, therefore, the complaint should embody such a statement of facts clearly showing
attached as Annex "A"; the attributes of unlawful detainer.30 However, the allegations of the petitioners' complaint did not show that they
3. Lot No. 4236 is covered by an approved plan, Plan Ap-03-004154 (a copy made Annex ‘B") and it consists of 914 had permitted or tolerated the occupation of the portion of their property by the respondents; or how the
square meters; respondents' entry had been effected, or how and when the dispossession by the respondents had started. All that
4. Adjacent to plaintiff’s [p]roperty is Lot No. 4235 of the Guagua Cadastre and covered by approved plan As-03- the petitioners alleged was the respondents' "illegal use and occupation" of the property. As such, the action was not
00533 (copy made Annex "C") which is being claimed by defendants and is the subject matter of Cadastral Case unlawful detainer.
No. N-229 of the Regional Trial Court of Guagua, Branch 53 where a decision (copy made Annex "D") was rendered
by said court on August 28, 1996 confirming the title over said lot in favor of defendant Bienvenido Bacani. The
said decision is now final and executory … Lastly, the conclusion by the MTC that the petitioners failed to show by clear and convincing evidence that the
5. On February 23, 1997, plaintiffs caused the relocation and verification survey of cadastral Not No. 4236 of the respondents had encroached on the petitioners' property was also warranted. In contrast, the only basis for the
Guagua Cadastre belonging to plaintiff and the adjoining lots, particularly Lot No. 4235 being claimed by RTC's decision was the result of the relocation and verification survey as attested to by the surveyor, but that basis
defendants; should be disallowed for the reasons earlier mentioned. Under the circumstances, the reinstatement of the ruling of
6. The relocation and verification survey conducted by Engr. Rufo R. Rivera, a duly licensed Geodetic Engineer per the MTC by the CA was in accord with the evidence.
plan (copy made Annex "F") revealed that defendants had encroached an area of 405 square meters of the parcel
of land belonging to plaintiffs. In fact, the whole or part of the houses of the said defendants have been erected in WHEREFORE, the Court AFFIRMS the decision promulgated on October 18, 2002; and ORDERS the petitioners to pay
said encroached portion; the costs of suit.
7. Sometime in June of 1997, plaintiffs through plaintiff Concepcion Gonzales lodged a complaint before the
Barangay Council of San Juan, Guagua, Pampanga against defendants regarding the encroached portion. A
G.R. No. L-66371 May 15, 1985
preliminary relocation survey was conducted by the Lands Management Sector of the DENR and it was found that
indeed, defendants encroached into the parcel of land belonging to plaintiffs. This finding was confirmed by the
approved plan Ap-03-004154; ARMANDO ANG, petitioner,
8. Since defendants refused to vacate the premises and surrender the peaceful possession thereof to plaintiff, the vs.
Barangay Captain of San Juan, Guagua, Pampanga issued a certification to file action (copy made Annex "G’) dated HON. JUDGE JOSE P. CASTRO, Regional Trial Judge, Branch LXXXIV and HON. JUDGE JOSE P. ARRO,
March 4, 1997 to enable the plaintiff to file the appropriate action in court; Branch CIII, both of the Regional Trial Court of Rizal, and ASSISTANT FISCAL NARCISO T. ATIENZA of
9. On March 10, 1997, plaintiffs senta formal demand letter (copy made Annex ‘H") to defendants to vacate the Quezon City, respondents.
premises and to pay reasonable compensation for the use of the said encroached portion;
10. Despite receipt of said demand letter per registry return cards attached to the letter, defendants failed and In the supplemenal petition for certiorari, prohibition and mandamus, Armando Ang seeks to set aside the order,
refused to vacate the encroached portion and surrender the peaceful possession thereof to plaintiffs; dated February 9, 1984, of respondent Judge Jose P. Castro of the Regional Trial Court, Branch LXXXIV in Quezon
11. Plaintiffs are entitled to a reasonable compensation in the amount of P 3,000.00 from defendants for the illegal City, denying his appeal from an order holding him in contempt of court. Petitioner likewise asks this Court (1) to
use and occupation of their property by defendants; order respondent judge Castro to forward the records of Civil Case No. Q-35466 to the Intermediate Appellate Court;
12. By reason of the unjust refusal of defendants to vacate the premises and pay reasonable compensation to (2) to enjoin him from enforcing his order for the arrest of petitioner; (3) to restrain respondent Assistant Fiscal
plaintiffs, the latter were constrained to engage the services of counsel for ₱30,00.00 plus ₱1,000.00 per Narciso 'I'. Atienza of Quezon City from conducting preliminary investigation on the libel charge filed against him by
appearance and incur litigation expenses in the amount of ₱10,000.00.27 respondent judge; and, (4) to prohibit respondent Judge Jose P. Arro of the Regional Trial Court of Rizal, Branch CIII,
Quezon City from proceeding and or conducting a hearing on the criminal complaint for libel against petitioner in
Given the foregoing allegations, the case should be dismissed without prejudice to the filing of a non-summary action Criminal Case No. Q-31587.
like accion reivindicatoria. In our view, the CA correctly held that a boundary dispute must be resolved in the context
of accion reivindicatoria, not an ejectment case. The boundary dispute is not about possession, but encroachment, In November 1983, petitioner, through the Office of the Presidential Assistant on Legal Affairs, lodged with this Court
that is, whether the property claimed by the defendant formed part of the plaintiff’s property. A boundary dispute an administrative complaint against respondent judge for ignorance of the law, gross inexcusable negligence,
cannot be settled summarily under Rule 70 of the Rules of Court, the proceedings under which are limited to unlawful incompetence, manifest partiality, grave abuse of discretion, grave misconduct, rendering unjust decision in Civil
detainer and forcible entry. In unlawful detainer, the defendant unlawfully withholds the possession of the premises Case No. Q-35466 and dereliction of duties in not resolving his motion for reconsideration of the adverse decision in
upon the expiration or termination of his right to hold such possession under any contract, express or implied. The said civil case.
defendant’s possession was lawful at the beginning, becoming unlawful only because of the expiration or termination

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On December 23, 1983, upon learning of the administrative case filed against him by petitioner, respondent judge the petition and required both parties to submit simultaneously their memoranda on the issues within thirty (30)
ordered petitioner to appear before him on December 29, 1983 at 8:30 in the morning, and to show cause why he days from notice.
should not be punished for contempt of court, for malicious, insolent, inexcusable disrespect and contemptuous
attitude towards the court and towards him. Despite the lapse of the period granted both parties, they failed to file their memoranda. Thus, the case is deemed
submitted for decision.
On January 9, 1984, respondent judge found petitioner guilty of contempt of court, sentenced him to suffer five (5)
days imprisonment and ordered his arrest for his failure, despite notice, to appear on the scheduled hearing of the Upon a careful scrutiny of the records of the case, We found that the alleged malicious imputations were not uttered
contempt charge against him. in the presence or so near respondent Judge Jose P. Castro as to obstruct or interrupt the proceedings before him;
rather, they were contained in the pleadings and/or letters-complaint filed by petitioner before the Office of the
On February 3, 1984, petitioner filed his notice of appeal from the judgment of conviction in the contempt charge but Presidential Assistant on legal Affairs and before this Court in the aforementioned administrative case filed by
the same was denied by the respondent judge in an Order, as follows: petitioner against him.
Considering that ARMANDO ANG was found guilty of "Direct Contempt" of court, the notice of appeal filed by him
thru counsel cannot be given due course and is hereby denied, as the pronouncement of guilt in a direct contempt Section 3, particularly paragraphs (b) and (d), Rule 71 of the New Rules of Court, provide:
is not appealable. SEC. 3. Indirect contempts to be punished after charge and hearing. — After charge in writing has been filed, and
Meantime, in view of the fact that said Armando Ang has remained in hiding and has been eluding the officers of an opportunity given to the accused to be heard by himself or counsel, a person guilty of any of the following acts
the law in serving the original warrant for his arrest, let an alias warrant be issued for his arrest so that he can may be punished for contempt:
serve his sentence of five (5) days imprisonment. (p. 45, Rollo) (b) Disobedience of or resistance to a lawful writ, process, order, judgment, or command of a court, or injunction
granted by a court or judge, including the act of a person who, after being dispossessed or ejected from any real
Thereafter, respondent judge instituted before the Office of the City Fiscal of Quezon City a criminal complaint (I.S. property by the judgment or process of any court of competent jurisdiction, enters or attempts or induces
No. 83- 22198) for libel against herein petitioner for using malicious, insolent and contemptuous language against another to enter into or upon such real property, for the purpose of executing acts of ownership or possession, or
him in his letter- complaint filed before this Court. in any manner disturbs the possession given to the person adjudged to be entitled thereto
(d) Any improper conduct tending directly or indirectly, to impede, obstruct, or degrade the administration of
Hence, instant petition. justice;

On February 20, 1984, We issued a temporary restraining order enjoining (1) the respondent judge from carrying out Respondent Judge Castro, in his comment, argues that failure of petitioner to appear, despite notice, on the
the warrant of arrest issued in Civil Case No. Q-35466, entitled: "Engson Realty Co., Inc., Plaintiff, versus Lim Eng Si, scheduled hearing of the contempt charge for the use of derogatory language in his two letters addressed to the
Defendant of the Regional Trial Court, Branch LXXXIV at Quezon City; and (2) the respondent fiscal from conducting Office of the Presidential Assistant on Legal Affairs and to this Court in an administrative complaint against him,
the preliminary investigation for libel lodged by respondent judge against petitioner in I.S. No. 83-22198 of Quezon constitutes direct contempt as the acts actually impeded, embarrassed and obstructed him in the administration of
City. justice.

Asked to comment why he proceeded with the preliminary investigation of the complaint for libel filed by respondent We do not agree. The Rules of Court cannot be any clearer. The use of disrespectful or contemptuous language
judge against herein petitioner, despite the restraining order from this Court, Fiscal Narciso T. Atienza explained that against a particular judge in pleadings presented in another court or proceeding is indirect, not direct, contempt as it
long before the undersigned receive said order, the information for libel against Armando Ang has already been filed is not tantamount to a misbehavior in the presence of or so near a court or judge as to interrupt the administration
in court." Indeed, records show that the information for libel was lodged on February 2, 1984; whereas, the of justice. Stated differently, if the pleading containing derogatory, offensive or malicious statements is submitted in
temporary restraining order was issued on February 20, 1984. the same court or judge in which the proceedings are pending, it is direct contempt because it is equivalent to a
misbehavior committed in the presence of or so near a court or judge as to interrupt the administration of justice.
Considering the aforecited provisions, petitioner's conduct if at all, constitutes indirect contempt and, if found guilty
On February 29,1984, upon knowing that Criminal Case No. Q-31587 for libel was instituted against him by he may appeal pursuant to Section 10, Rule 71 of the Rules of Court. which reads:
respondent Fiscal Atienza, petitioner filed a supplemental petition for prohibition against respondent Judge Jose P. SEC. 10. Review of judgment or order by Court of appeals or Supreme Court; bond for stay. — The judgment or
Arro of the Regional Trial Court, Branch CIII, in Quezon City, who was assigned to try and hear said criminal case. order of a Court of First Instance made in a case of contempt punished after written charge and hearing may be
Petitioner prays for a supplemental writ of preliminary injunction to enjoin Judge Arro from proceeding with said reviewed by the Court of Appeals or the Supreme Court, but execution of the judgment or order shall not be
Criminal Case No. Q-31587. suspended until a bond is filed by the person in contempt, in an amount fixed by the Court of First Instance,
conditioned that if the appeal be decided against him he will abide by and perform the judgment or order. The
On March 5, 1984, We issued a Temporary Restraining Order enjoining respondent Judge from proceeding and/or appeal may be taken as in criminal cases.
conducting hearing on the criminal complaint for libel.
Anent the ancillary action for prohibition, We find the same meritorious, considering that the basis of the libel case
On June 4, 1984, after considering the allegations, issues, and arguments adduced in the petition and supplemental (Criminal Case No. Q-31587) filed against petitioner before the respondent Regional Trial Court, Branch CIII, Quezon
petition petition for certiorari, prohibition and mandamus, respondents' comments thereon as well as petitioner's City was a communication addressed to the Chief Justice of the Supreme Court which was coursed through the Office
reply to respondent fiscal's comment with motion to dismiss the aforesaid petition, We resolved to give due course to of the Presidential Assistant on legal Affairs, complaining against respondent judge's ignorance of the law, gross

76
inexcusable negligence, incompetence, disregard for the Supreme Court administrative order, grave misconduct, ito, bakit hindi niya kasuhan ang mga ito? Ito rin ang katanungan ni Mr. Tony Omaga Diaz, ang station manager ng
rendering an unjust decision and dereliction of duty. It is manifest that as held in the case of Santiago vs. Calvo, 48 DYPR. O bale ba gumawa siya ng sariling MULTO Pagkatapos ay takot na takot siya sa multong kanyang ginawa.
Phil. 922, "a communication made in good faith upon any subject matter in which the party making the
communication has an interest or concerning which he has a duty is privileged if made to a person having a Usap-usapan pa rin ang kaso ni Godoy. Ito raw ay isang open book maging sa kanyang mga co-teachers sa Pulot
corresponding interest or duty, although it contains incriminatory or derogatory matter which without the privilege na nagli-live in si Godoy at ang babaing si Mia Taha. Matagal na ang kanilang ugnayan. Meron ding "balita" ewan
would be libelous and actionable ... that parties, counsel and witnesses are exempted from liability in libel or slander kung totoo, na noong si Godoy daw ay nasa Provincial Jail pa ay dinadalaw siya ni Taha At kumakain pa sila sa
for words otherwise defamatory published in the course of judicial proceedings, provided the statements are labas kasama ang isang Provincial Guard.  Ito rin ang dahilan kung bakit ipinagpilitan ni Judge Gacott na madala
pertinent or relevant to the case. " kaagad sa Muntinlupa sa National Bilibid Prisons si Godoy kahit na ang kaso ay naka-apela pa.

Records show that the libel case had already been instituted in court when the restraining order was issued by Us. Pero mayroon payo si Atty. Telesforo Paredes, Jr. sa mga mamamayan ng Palawan, mag-ingat kayo sa paglalakad
Nonetheless, considering the privileged character of petitioner's communication to the Chief Justice barring a at baka kung hindi kayo madapa ay madulas daw kayo. Dahil ayon daw kay Judge Gacott, base sa kanyang
prosecution for libel, it is proper that the injunction against respondent Regional Trial Court, Branch CIII, Quezon interview sa Magandang Gabi Bayan, "Tagilid na raw and mundo. Maraming nagpapatunay daw dito, maski sa
City, from proceeding with the hearing of Criminal Case No. Q-31587, be made permanent pursuant to the kapitolyo." Joke lang. Pero isang warning din sa may mga nobya, na mag-ingat sa pag-break sa inyong girlfriend,
restraining order and established doctrine against the use of the strong arm of the law as an instrument of arbitrary dahil baka mademanda kayo at masentensyahan ng double death penalty, lalo na kung kay Judge Gacott, dahil
and oppressive prosecution. alam na ninyo, tagilid and laban diyan.

ACCORDINGLY, the petition with respect to the action against respondent Judge Jose P. Castro of the Regional Trial The complaint avers that the article tends to impede, obstruct, belittle, downgrade and degrade the administration of
Court, Branch LXXXIV, Quezon City is granted and said respondent judge is hereby ordered to elevate the records of justice; that the article contains averments which are disrespectful, discourteous, insulting, offensive and derogatory;
Civil Case No. Q-35466 to the Intermediate Appellate Court at once for disposition in accordance with the terms that it does not only cast aspersions on the integrity and honesty of complainant as a judge and on his ability to
hereof. administer justice objectively and impartially, but is an imputation that he is biased and he prejudges the cases filed
before him; and that the article is sub judice  because it is still pending automatic review.
Respondent trial judge is hereby ordered to dismiss the libel case (Criminal Case No. Q-31587).
Respondent Mauricio Reynoso, Jr. contends in his Comment 2 that his article does not intend to impede nor obstruct
The temporary restraining order issued on February 20, 1984 enjoining respondent Judge Jose P. Castro from the administration of justice because the same was published after complainant had promulgated his decision in the
enforcing or carrying out the warrant of arrest issued in Civil Case No. Q-35466 is made permanent. case; that such publication will not affect or influence the review by the Supreme Court of the criminal case,
considering that the Palawan Times is circulated only in the City of Puerto Princess and some parts of Palawan; that
G.R. Nos. 115908-09 March 29, 1995 the comments made therein were made in good faith and in the exercise of the freedom of expression and of the
press; that while the article may contain unfavorable comments about complainant, it cannot be considered as
having the tendency to degrade or impede the administration of justice; and that the complaint, which is for
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, contempt of a judge of a regional trial court, was erroneously filed with the Supreme Court contrary to Section 4,
vs. Rule 71 of the rules of Court.
DANNY GODOY, accused-appellant.

Respondent Eva P. Ponce de Leon, in her Comment 3 and Supplemental Comment,4 asserts that the article is merely
For separate resolution, as an incident arising from these criminal cases under automatic review by the court, is a in reaction to the television interview given by complainant in the show, "Magandang Gabi Bayan," last June 18,
complaint1 filed by judge Eustaquio Z. Gacott, Jr. of the Regional Trial Court of Palawan and Puerto Princesa City, 1994 wherein the latter defended his decision in Criminal Cases Nos. 11640-41, entitled "People vs. Godoy;" that the
Branch 47, to cite for indirect contempt Mauricio Reynoso, Jr., a columnist, and Eva P. Ponce de Leon, publisher and article is no longer sub judice  as the same was published only after complainant had rendered his decision and had
chairman of the editorial board, respectively, of the Palawan Times. His Honor's plaint is based on an article written already lost jurisdiction over the case; that the article cannot be considered contemptuous and defamatory in the
by respondent Reynoso, Jr. in his column, "On the Beat," and published in the July 20, 1994 issue of said newspaper absence of a clear and present danger that it will tend directly or indirectly to impede, obstruct, or ridicule the
which is of general circulation in Puerto Princesa City. administration of justice; that it constitutes a valid exercise of the constitutionally guaranteed freedom of the press;
that a reading of the subject article in its entirety will show that the same does not constitute contempt but, at most,
The pertinent portions of the article complained of are hereunder reproduced, with the alleged contemptuous is merely a fair criticism which did not intend to malign nor place him in disrepute in the performance of his
statements italicized for ready identification as the particulars equivalent to the innuendo  in a libel charge: functions; and that respondent Ponce de Leon cannot be held liable for contempt because she did not have either
actual knowledge of, or Personal connection with, the authorship or publication of the allegedly contemptuous article,
since she had just returned from the United States when the same was published.
Isang maalab na issues (sic) pa ay ang DEATH THREATS laban kono kay Judge Eustaquio Gacott, Jr. ng mga
pamilya ng kanyang sinentensiyahan ng Double Death Penalty. Sinabi ni Wilmar Godoy sa DWRM programa na
wala silang pagbabantang ginawa umano, at hindi nila ito kailan man isinaisip. Umaasa na lamang sila sa magiging On the issue of whether the specified statements complained of are contumacious in nature, we are inclined, based
resulta ng review ng Korte Suprema. Ayon naman kay Gacott sa kanyang interview sa DYPR ay totoong on an overall perusal and objective analysis of the subject article, to hold in the negative. We have read and reread
pinagbabantaan siya ng mga Godoy. Kaya ayon marami siyang Security na armado,  in full battle gear. Kung totoo the article in its entirety and we are fully convinced that what is involved here is a situation wherein the alleged

77
disparaging statements have been taken out of context. If the statements claimed to be contumelious had been read girlfriend, dahil baka mademanda kayo at masentensyahan ng double death penalty, lalo na kung kay Judge
with contextual care, there would have been no reason for this contempt proceeding. Gacott, dahil alam na ninyo, tagilid and laban diyan."

In our aforestated evaluation, we were sufficiently persuaded to favorably consider the following explanation of Again, the subject article merely reports what Atty. Telesforo Paredes, Jr. allegedly said. But more importantly, the
respondent Ponce de Leon in her Supplemental Comment: foregoing is merely a reaction not so much to Complainant's Decision, but to the public statements made by
Complainant in the national television show "Magandang Gabi Bayan."
On the other hand, a reading of the subject article in its entirety will show that the same does not constitute
contempt, but at most, merely constitutes fair criticism. Snide remarks or sarcastic innuendoes do not necessarily assume that level of contumely which is actionable under
Rule 71 of the Rules of Court. Neither do we believe that the publication in question was intended to influence this
The first portion of the article reads: Court for it could not conceivably be capable of doing so. The article has not transcended the legal limits for editorial
"Isang maalab na issues (sic) pa ay ang DEATH THREATS laban kono kay Judge Eustaquio Gacott, Jr. ng mga comment and criticism. Besides, it has not been shown that there exists a substantive evil which is extremely serious
pamilya ng kanyang sinentensiyahan ng Double Death Penalty. Sinabi ni Wilmar Godoy sa DWRM programa na and that the degree of its imminence is so exceptionally high as to warrant punishment for contempt and sufficient to
wala silang pagbabantang ginawa umano, at hindi nila ito kailan man isinaisip. Ayon naman kay Gacott sa disregard the constitutional guaranties of free speech and press.
kanyang interview sa DYPR ay totoong pinagbabantaan siya ng mga Godoy. Kaya ayon marami siyang Security
na armado, in full battle gear. Kung totoo ito, bakit hindi niya kasuhan ang mga ito? Ito rin ang katanungan ni It has been insightfully explained and suggested that a judge will generally and wisely pass unnoticed any mere
Mr. Tony Omaga Diaz, ang station manager ng DYPR. O bale ba gumawa siya ng sariling MULTO Pagkatapos ay hasty and unguarded expression of passion, or at least pass it with simply a reproof. It is so that in every case where
takot na takot siya sa multong kanyang ginawa." a judge decides for one party, he decides against another; and oftentimes both parties are beforehand equally
confident and sanguine. The disappointment, therefore, is great, and it is not in human nature that there should be
The foregoing does not even deal with the merits of the case, but with the public accusations being made by other than a bitter feeling, which often reaches to the judge as the cause of the supposed wrong. A judge, therefore,
complainant that he is being given death threats by the family of the accused, Danny Godoy. The article only ought to be patient, and tolerate everything which appears as but the momentary outbreak of disappointment. A
makes a justifiable query as to why Complainant does not file the appropriate charges if his accusations are true. second thought will generally make a party ashamed of such, outbreak, and the dignity of the court will suffer none
"Usap-usapan pa rin ang kaso ni Godoy. Ito raw ay isang open book maging sa kanyang mga co-teachers sa by passing it in silence.5
Pulot na nagli-live in si Godoy at ang babaing si Mia Taha. Matagal na ang kanilang ugnayan. Meron ding ‘balita’
ewan kung totoo, na noong si Godoy daw ay nasa Provincial Jail pa ay dinadalaw siya ni Taha At kumakain pa sila Prescinding from the foregoing adjudgment, the Court observes that there are two primary issues presented in this
sa labas kasama ang isang Provincial Guard. Ito rin ang dahilan kung bakit ipinagpilitan ni Judge Gacott na incident which deserve a more extended disquisition, firstly, because of their importance and frequent involvement in
madala kaagad sa Muntinlupa sa National Bilibid Prisons si Godoy kahit na ang kaso ay naka-apela pa." contempt proceedings filed in the courts, and, secondly, by reason of the fact that there are numerous and variant
(Emphasis supplied) pronouncements on the subject of contempt which need to be clarified. The principal issues are (1) whether or not
there can be contempt of court in case of post-litigation statements or publications; and (2) which court has
The foregoing is merely a report of rumors regarding the accused Danny Godoy. They are not presented as facts by jurisdiction over a contempt committed against the trial court while the case is pending on appeal. Other cognate and
respondent Mauricio Reynoso, Jr. In fact, he even goes to the extent of acknowledging that he himself does not related issues must also be discussed so as to provide judicial guidance on the present state of our statutory and
know if the rumors are true or not. case laws thereon.

The subject article then offers the following analysis: Before we go into a more intensive analysis of said issues, however, it may be beneficial for purposes thereof to
"Malaking epekto ang desisyon ng Korte Suprema sa dalawang tao, kay Danny Godoy at Judge Gacott. Kung preliminarily revisit and expound on the nature and implications of a special civil action for contempt or of any
babaliktarin ng Supreme Court and decision ni Gacott, lalaya si Godoy, si Gacott naman ang masisira, ang initiatory pleading therefor filed as an incident in the main case. That exercise will further explain and justify our
kanyang aspirations na maitaas sa Court of Appeals at eventually makasama sa mga miyembro ng korte suprema disposition of the contempt charge herein.
ng bansa. Kung papaboran naman Gacott ay sigurado na ang kamatayan ni Godoy, at double pa pero si Gacott
maitataas pa ang puwesto. Tayo naman, hintay lamang tayo ng ano mang magiging developments ng kaso." I. Prefatorial Considerations

The foregoing is nothing more than a fair analysis. For indeed, if the Honorable Court affirms the Decision of The exercise of the power to punish for contempt has a dual aspect, primarily, the proper punishment of the guilty
Complainant, the accused Danny Godoy would be meted the death sentence. On the other hand, if the decision is party for his disrespect to the court, and, secondarily, his compulsory performance of some act or duty required of
reversed, this may adversely affect the aspirations of Complainant to be promoted to the Court of Appeals, and him by the court and which he refuses to perform. Due perhaps to this two fold aspect of the exercise of the power to
eventually to the Honorable Court. punish them, contempts are classified as civil or criminal.6 However, the line of demarcation between acts
constituting criminal contempt, as distinguished from civil contempt, is quite indistinct. The confusion in attempts to
Finally, the subject article reads: classify civil and criminal contempts is due to the fact that there are contempts in which both elements appear; or
"Pero mayroon payo si Atty. Telesforo Paredes, Jr. sa mga mamamayan ng Palawan, mag-ingat kayo sa there are contempts which are neither wholly civil nor altogether criminal, but partake of the characteristics of both;
paglalakad at baka kung hindi kayo madapa ay madulas daw kayo. Dahil ayon daw kay Judge Gacott, base sa or it is also possible that the same act may constitute both a civil and criminal contempt.
kanyang interview sa Magandang Gabi Bayan, 'Tagilid na raw and mundo. Maraming nagpapatunay daw dito,
maski sa kapitolyo.' Joke lang. Pero isang warning din sa may mga nobya, na mag-ingat sa pag-break sa inyong A. As to the Nature of the Offense

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A criminal contempt is conduct that is directed against the dignity and authority of the court or a judge acting to be strictly construed. However, criminal proceedings are not required to take any particular form so long as the
judicially; it is an act obstructing the administration of justice which tends to bring the court into disrepute or substantial rights of the accused are preserved. 13
disrespect.7 On the other hand, civil contempt consists in failing to do something ordered to be done by a court in a
civil action for the benefit of the opposing party therein and is, therefore, an offense against the party in whose Civil contempt proceedings are generally held to be remedial and civil in their nature; that is, they are proceedings
behalf the violated order is made.8 for the enforcement of some duty, and essentially a remedy for coercing a person to do the thing required. As
otherwise expressed, a proceeding for civil contempt is one instituted to preserve and enforce the rights of a private
A criminal contempt, being directed against the dignity and authority of the court, is an offense against organized party to an action and to compel obedience to a judgment or decree intended to benefit such a party litigant. So a
society and, in addition, is also held to be an offense against public justice which raises an issue between the public proceeding is one for civil contempt, regardless of its form, if the act charged is wholly the disobedience, by one
and the accused, and the proceedings to punish it are punitive. On the other hand, the proceedings to punish a civil party to a suit, of a special order made in behalf of the other party and the disobeyed order may still be obeyed, and
contempt are remedial and for the purpose of the preservation of the right of private persons. It has been held that the purpose of the punishment is to aid in an enforcement of obedience. The rules of procedure governing criminal
civil contempt is neither a felony nor a misdemeanor, but a power of the court.9 contempt proceedings, or criminal prosecutions, ordinarily are inapplicable to civil contempt proceedings. It has been
held that a proceeding for contempt to enforce a remedy in a civil action is a proceeding in that action. Accordingly,
It has further been stated that intent is a necessary element in criminal contempt, and that no one can be punished where there has been a violation of a court order in a civil action, it is not necessary to docket an independent action
for a criminal contempt unless the evidence makes it clear that he intended to commit it. On the contrary, there is in contempt or proceed in an independent prosecution to enforce the order. It has been held, however, that while the
authority indicating that since the purpose of civil contempt proceedings is remedial, the defendant's intent in proceeding is auxiliary to the main case in that it proceeds out of the original case, it is essentially a new and
committing the contempt is immaterial. Hence, good faith or the absence of intent to violate the court's order is not a independent proceeding in that it involves new issues and must be initiated by the issuance and service of new
defense in civil contempt. 10 process. 14

B. As to the Purpose for which the Power is Exercised 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. In criminal contempt proceedings, it is generally held that the
State is the real prosecutor. 15
A major factor in determining whether a contempt is civil or criminal is the purpose for which the power is exercised.
Where the primary purpose is to preserve the court’s authority and to punish for disobedience of its orders, the
contempt is criminal. Where the primary purpose is to provide a remedy for an injured suitor and to coerce Contempt is not presumed. In proceedings for criminal contempt, the defendant is presumed innocent and the
compliance with an order, the contempt is civil. A criminal contempt involves no element of personal injury. It is burden is on the prosecution to prove the charges beyond reasonable doubt. In proceedings for civil contempt, there
directed against the power and dignity of the court; private parties have little, if any, interest in the proceedings for is no presumption, although the burden of proof is on the complainant, and while the proof need not be beyond
punishment. Conversely, if the contempt consists in the refusal of a person to do an act that the court has ordered reasonable doubt, it must amount to more than a mere preponderance of evidence. It has been said that the burden
him to do for the benefit or advantage of a party to an action pending before the court, and the contemnor is of proof in a civil contempt proceeding lies somewhere between the criminal "reasonable doubt" burden and the civil
committed until he complies with the order, the commitment is in the nature of an execution to enforce the judgment "fair preponderance" burden. 16
of the court; the party in whose favor that judgment was rendered is the real party in interest in the proceedings.
Civil contempt proceedings look only to the future. And it is said that in civil contempt proceedings, the contemnor On the basis of the foregoing legal principles which are now well settled, it can be safely concluded that under
must be in a position to purge himself. 11 paragraph (d) of Section 3, Rule 71 of the Rules of Court on indirect contempt, any improper conduct tending,
directly or indirectly, to impede, obstruct, or degrade the administration of justice, constitutes criminal contempt.
C. As to the Character of the Contempt Proceeding
II. Whether or not Post-Litigation Publications can be the Subject of Contempt Proceedings
It has been said that the real character of the proceedings is to be determined by the relief sought, or the dominant
purpose, and the proceedings are to be regarded as criminal when the purpose is primarily punishment, and civil A. Effect of Freedom of Speech and Press Guaranties
when the purpose is primarily compensatory or remedial. 12
In the case of In re Sotto, 17 this Court had the opportunity to define the relation between the courts and the press,
Criminal contempt proceedings are generally held to be in the nature of criminal or quasi-criminal actions. They are quoting there in the statements made by Judge Holmes in U.S. vs. Sullen, 18 thus:
punitive in nature, and the Government, the courts, and the people are interested in their prosecution. Their purpose The administration of justice and the freedom of the press, though separate and distinct, are equally sacred, and
is to preserve the power and vindicate the authority and dignity of the court, and to punish for disobedience of its neither should be violated by the other. The press and the courts have correlative rights and duties and should
orders. Strictly speaking, however, they are not criminal proceedings or prosecutions, even though the contemptuous cooperate uphold the principles of the Constitution and laws, from which the former receives its prerogative and
act involved is also a crime. The proceeding has been characterized as sui generis, partaking of some of the elements the latter its jurisdiction. The right of legitimate publicity must be scrupulously recognized and care taken at all
of both a civil and criminal proceeding, but really constituting neither. In general, criminal contempt proceedings times to avoid impinging upon it. In a clear case where it is necessary in order to dispose of judicial business
should be conducted in accordance with the principles and rules applicable to criminal cases, in so far as such unhampered by publications which reasonably tend to impair the impartiality of verdicts, or otherwise obstruct the
procedure is consistent with the summary nature of contempt proceedings. So it has been held that the strict rules administration of justice, this Court will not hesitate to exercise its undoubted power to punish for contempt. This
that govern criminal prosecutions apply to a prosecution for criminal contempt, that the accused is to be afforded Court must be permitted to proceed with the disposition of its business in an orderly manner free from outside
many of the protections provided in regular criminal cases, and that proceedings under statutes governing them are interference obstructive of its constitutional functions. This right will be insisted upon as vital to an impartial court,

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 and, as a last resort, as an individual exercises the right of self-defense, it will act to preserve its existence as an and exalts it above all nations upon the earth . . . . The constitution has provided very apt and proper remedies for
unprejudiced tribunal. correcting and rectifying the involuntary mistakes of judges, and for punishing and removing them for any
voluntary perversions of justice. But, if their authority is to be trampled upon by pamphleteers and newswriters,
Hence, a person charged with contempt of court for making certain utterances or publishing writings which are and the people are to be told that the power given to the judges for their protection is prostituted to their
clearly opprobrious may not, ordinarily, escape liability therefor by merely invoking the constitutional guaranties of destruction, the court may retain its power some little time; but I am sure it will instantly lose all its authority, and
freedom of speech and press. Liberty of speech and the press must not be confused with an abuse of such liberties. the power of the court will not long survive the authority of it: Is it possible to stab that authority more fatally than
Obstructing, by means of the spoken or written word, the administration of justice by the courts has been described by charging the court, and more particularly the chief justice, with having introduced a rule to subvert the
as an abuse of the liberty of speech or the press such as will subject the abuser to punishment for contempt of court. constitutional liberty of the people? A greater scandal could not be published . . . . It is conceded that an act of
violence upon his person when he was making such an order would be contempt punishable by attachment. Upon
what principle? For striking a judge in walking along the streets would not be a contempt of the court. The reason,
Guaranties of free speech and a free press, as they appear in the Constitution, are frequently couched so as to therefore, must be, that he is in the exercise of his office, and discharging the function of a judge of this court;
impute responsibility for any abuse of the privilege, and it is sometimes recognized that with respect to whether an and, if his person is under this protection, why should not his character be under the same protection? It is not for
allegedly scandalous publication or utterance is to be treated as a contempt, a line must be drawn between those the sake of the individual, but for the sake of the public, that his person is under such protection; and, in respect of
speeches or writings which are protected by the privilege of free speech and a free press and those which constitute the public, the imputing of corruption and the perversion of justice to him, in an order made by him at his
an abuse of it. chambers, is attended with much more mischievous consequences than a blow; and therefore the reason of
proceeding in this summary manner applies with equal, if not superior, force, to one case as well as the other.
The right of freedom of the press is only a specific instance of the general right of freedom of speech; persons There is no greater obstruction to the execution of justice from the striking a judge than from the abusing him,
engaged in the newspaper business cannot claim any other or greater right than that possessed by persons not in because his order lies open to be enforced or discharged, whether the judge is struck or abused for making it.
that business. 19
2. The American Doctrine
B. Different Doctrines or Schools of Thought
In American jurisprudence, the general rule is that defamatory comments on the conduct of a judge with respect to
In the case of In re Francisco Brillantes, 20 Justice Perfecto explained in his dissenting opinion that "as to whether past cases or matters finally disposed of do not constitute contempt, even though libelous and reflecting on the
contempt may be committed for criticizing a tribunal after the same has rendered decision or taken final action on a integrity of the judge and the court. 21 It has been said that the power to punish as a contempt a criticism concerning
matter which is the subject of criticism, there are two schools of thought represented, respectively, by what we may a case made after its termination is denied under the theory that such a power is not necessary as a safeguard to the
call the English doctrine and the American doctrine, the first for the affirmative and the last one for the negative. The proper functioning of the court as a judicial tribunal. And it has been said that comments, however stringent, relating
question now is to determine which of the two doctrines is more conformable to reason and justice and, therefore, to judicial proceedings which are past and ended are not contempt of court even though they may be a libel against
should be, adopted and applied by our tribunals." the judge or some other officer of the court. There is even the view that when a case is finished, the courts and
judges are subject to the same criticisms as other people and that no comment published in connection with a
1. The English Doctrine completed case, however libelous or unjust, is punishable as contempt of court. Thus it is said that the remedies of a
judge who suffers abuse at the hands of the press, not amounting to contempt, are the same as those available to
persons outside the judiciary. 22
According to Justice Perfecto, the rule in England is that there can be contempt of court even after the case has been
terminated. He then proceeded to ramify:
To the same effect was the holding in People ex rel.  Supreme Court vs.  Albertson, 23 where it was declared that —
In England comments upon the court's action in a concluded case, where libelous or calculated to bring the court
into disrepute, were freely punishable as contempt under the early common law. Distinction between pending and The great weight of authority is to the effect that — in so far as proceedings to punish for contempt are concerned
— comment upon the behavior of the court in cases fully determined in the particular court criticized is unrestricted
concluded matters does not seem to have been made. Any comment impairing the dignity of the court was
punishable as contempt regardless of the time at which made. under our constitutional guaranty of liberty of the press and free speech, especially in the absence of a statute of
direct application to the contrary. This view in brief is based upon the theory that — keeping our constitutional
guaranties in mind — libelous publications which bear upon the proceedings of a court while they are pending may
The whole theory of the early common law of contempt is admirably delivered by Wilmot, J., in King vs. Almon, . . . in some way affect their correct determination, and are properly the subject of contempt proceedings. On the other
. The publication there complained of was a volume containing a diatribe against Lord Mansfield for allowing an hand, such publications or oral utterances of entirely retrospective bearing come within the sphere of authorized
amendment of pleading as of course, and apparently from corrupt motives, in a concluded case, and further comment unless they affect a judge personally, when he has his remedy in an action of libel or slander, as does
charging him with having introduced a practice to defeat the efficacy of the writ of habeas corpus. It is there said: any other individual thus offended. He has the right to bring an action at law before a jury of his peers.
"The arraignment of the justice of the judges is arraigning the King's justice; it is an impeachment of his wisdom
and goodness in the choice of his judges, and excites in the mind of the people a general dissatisfaction with all
Along similar lines, in Ex Parte Mcleod, 24 the court ruled that:
judicial determinations, and indisposes their minds to obey them; and, whenever men's allegiance to the laws is so
fundamentally shaken, it is the most fatal and most dangerous obstruction of justice, and, in my opinion, calls for a The right of a court to punish, as for contempts, criticisms of its acts, or even libels upon its officers, not going to
the extent, by improper publications, of influencing a pending trial, . . . would not only be dangerous to the rights
more rapid and immediate redress than any other obstruction whatever — not for the sake of the judges as private
individuals, but because they are the channels by which the Kings' justice is conveyed to the people. To be of the people, but its exercise would drag down the dignity and moral influence of these tribunals. Such criticism is
the right of the citizen, and essential not only to the proper administration of justice, but to the public tranquility
impartial, and to be universally thought so, are both absolutely necessary for giving justice that free, open, and
uninterrupted current which it has for many ages found all over this Kingdom, and which so eminently distinguishes

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 and contentment. Withdrawing power from courts to summarily interfere with such exercise of the right of the It will be noted that the aforequoted conclusion was arrived at after a short discourse presented by the  ponente  on
press and freedom of speech deprives them of no useful power. the existing divergence of opinions on the matter between the English and American courts. But the learned justice,
notwithstanding his preference for and application of the American doctrine, nonetheless thereafter made the
Likewise, the State Supreme Court of Montana in State ex rel.  Metcalf vs.  District Court, 25 pointed out that the legal recommendatory observation that "(w)ith reference to the applicability of the above authorities, it should be
proceeding involved therein was not pending when the alleged libelous article was published, then referred to the remarked first of all that this court is not bound to accept any of them absolutely and unqualifiedly. What is best for
guaranty of freedom of speech and the press, and eventually held that the publication involved was not punishable as the maintenance of the judiciary in the Philippines should be the criterion."
contempt. It declared that so long as the published criticism does not impede the due administration of the law, it is
better to maintain the guaranty of the Constitution than to undertake to compel respect or punish libel by the It seems that this view was shared by then Associate Justice Moran when he dissented from the majority opinion in
summary process of contempt. the aforecited case of People vs.  Alarcon, et al., which upheld the doctrine enunciated in Lozano  and Abistado, in this
wise: "I know that in the United States, publications about courts, after the conclusion of a pending case, no matter
Finally, in holding that persons who had published newspaper articles alleging that a designated judge had been how perverse or scandalous, are in many instances brought within the constitutional protection of the liberty of the
intentionally partial and corrupt in the trial of certain causes which had been decided and were not pending when the press. But while this rule may find justification in that country, considering the American temper and psychology and
publication occurred could not be punished as for contempt the court, in State ex rel.  Attorney General vs.  Circuit the stability of its political institutions, it is doubtful whether here a similar toleration of gross misuse of liberty of the
Court, 26 cited a number of cases supporting the view that libelous newspaper comments upon the acts of a court in press would, under our circumstances, result in no untoward consequences to our structure of democracy yet in the
actions past and ended do not constitute contempt. It pointed out that some of such decisions took the position that process of healthful development and growth."
to punish such publications would constitute a serious invasion of constitutional guaranties of free speech and a free
press. Such perception could have probably impelled Justice Moran to deviate from the then accepted doctrine, with this
rationalization:
It ratiocinated in this manner: "Important as it is that courts should perform their grave public duties unimpeded and Contempt, by reason of publications relating to courts and to court proceedings, are of two kinds. A publication
unprejudiced by illegitimate influences, there are other rights guaranteed to all citizens by our Constitution and form which tends to impede, obstruct, embarrass or influence the courts in administering justice in a pending suit or
of government, either expressly or impliedly, which are fully as important, and which must be guarded with an proceeding, constitutes criminal contempt which is summarily punishable by courts. This is the rule announced in
equally zealous care. These rights are the rights of free speech and of free publication of the citizens' sentiments on the cases relied upon by the majority. A publication which tends to degrade the courts and to destroy public
all subjects. It seems clear to us that so extreme a power as to punish for contempt because of libelous publications confidence in them or that which tends to bring them in any way into disrepute, constitutes likewise criminal
as to past litigation, is inconsistent with, and would materially impair, the constitutional rights of free speech and free contempt, and is equally punishable by courts. In the language of the majority, what is sought, in the language of
press." the majority, what is sought, in the first kind of contempt, to be shielded against the influenced of newspaper
comments, is the all-important duty of the courts to administer justice in the decision of a pending case. In the
second kind of contempt, the punitive hand of justice is extended to vindicate the courts from any act or conduct
However, even under American jurisprudence, as shall hereafter be demonstrated, the aforesaid rulings are not calculated to bring them into disfavor or to destroy public confidence in them. In the first, there is no contempt
without exceptions. There is ample authority that, under proper circumstances, constitutional guaranties of freedom where there is no action pending, as there is no decision which might in any way be influenced by the newspaper
of speech and liberty of the press do not protect contemptuous publications relating to court proceedings even publication. In the second, the contempt exists, with or without a pending case, as what is sought to be protected
though such publications are not made until after the pendency of the litigation in question.27 is the court itself and its dignity. Courts would lose their utility if public confidence in them is destroyed.

3. The Philippine Doctrine That dissenting opinion was impliedly adopted in the subsequent case of In re Brillantes, 31 where the editor of the
Manila Guardian was declared in contempt of court for publishing an editorial, stating that the 1944 Bar Examinations
In the Philippine setting, as we have noted, there are conflicting views on this issue which have to be analyzed and, if were conducted in a farcical manner, even after the case involving the validity of said examinations had been
possible, reconciled. On that exordial indication, we have digressed into these aspects of the law on contempt and terminated. This was followed by In re Almacen  32 where the Court stated categorically that the rule that bars
seized upon this incident in the criminal cases at bar in order to essay a rapprochement of such views into what we contempt after a judicial proceeding has terminated had lost much of its validity, invoking therein the ruling
may call the Philippine doctrine. in Brillantes  and quoting with approval the dissenting opinion in Alarcon.

In the early cases decided by this Court involving contempts through newspaper publications, the rule was that It appears, therefore, that in the two latest cases decided by this Court, the general rule that there can be no
contemptuous publications were actionable only if committed with respect to pending suits. Apparently, the weight of contempt in post-litigation publications is not necessarily all-embracing under certain situations. From the shift in
authority then was to the effect that criticism of the conduct of a judge or a court with regard to matters finally judicial approach in Brillantes to the position announced in Almacen, it can inevitably be concluded that the
disposed of does not constitute contempt, even though it may be libelous. termination of the case is not a guaranty of immunity from a contempt charge for publications or utterances which
are defamatory or libelous, depending on the purpose and effects thereof. In other words, one may still be cited for
contempt of court even after a case has ended, where such punitive action is necessary to protect the court and its
That rule first found application in the case of In re Lozano, et al. 28 and was reiterated in the subsequent cases of In
re Abistado, 29 and People vs.  Alarcon, et al, 30 where this Court, speaking through Justice Malcolm, tersely stated: dignity and to vindicate it from acts or conduct intended or calculated to degrade, ridicule or bring the court into
disfavor and thereby erode or destroy public confidence in that court.
The rule is well established that newspaper publications tending to impede, obstruct, embarrass, or influence the
courts in administering justice in a pending suit proceeding constitute criminal contempt which is summarily
punishable by the courts. The rule is otherwise after the cause is ended. . . . (6 R.C.L., pp. 508-515). This qualified distinction is not without justification and, in fact, was also foreshadowed by the concurring opinion of
Justice Briones in Brillantes  wherein, after noting the conflicting views on the amenability of the contemnor during

81
the pendency or after the termination of the judicial proceeding in the court involved as illustrated by the English and We do not hesitate to hereby give our imprimatur to the aforequoted opinion which, we fully believe, conforms to
American doctrines thereon, he advanced the proposition that — basic dogmatic teachings on judicial and professional conduct requiring respect for and the giving of due deference to
the judicial system and its members — ethical standards which this Court has, time and again, been trying to
The rationale for making a qualification to the rule generally considered as the American doctrine, which rule as inculcate in the minds of every member of the Bar and the public in general.
herein qualified we now adopt and refer to as the Philippine doctrine on this issue, is profoundly and eloquently
explicated by Justice Moran in Alarcon, to wit: 4. Cautela  on the Balancing of Interests

It is true that the Constitution guarantees the freedom of speech and of the press. But license or abuse of that On the bases of the foregoing authorities, it is evident that a line has to be drawn between those utterances or
freedom should not be confused with freedom in its true sense. Well-ordered liberty demands no less unrelaxing writings which are protected by the privileges of free speech and a free press and those which constitute an abuse
vigilance against abuse of the sacred guaranties of the Constitution than the fullest protection of their legitimate thereof, in determining whether an allegedly scurrilous publication or statement is to be treated as contempt of court.
exercise. As important as is the maintenance of a free press and the free exercise of the rights of the citizens is the But to find the line where the permissible right of free speech ends and its reprehensible abuse begins is not always
maintenance of a judiciary unhampered in its administration of justice and secure in its continuous enjoyment of an easy task. In contempt proceedings, it was held that this line must usually be defined by the courts themselves,
public confidence. "The administration of justice and freedom of the press, though separate and distinct are equally and in such cases its location is to be established with special care and caution. 33
sacred, and neither should be violated by the other. The press and the courts have correlative rights and duties and
should cooperate to uphold the principles of the Constitution and the laws, from which the former receives its In so doing, it becomes necessary to give the subject that careful examination commensurate with its importance,
prerogatives and the latter its jurisdiction." (U.S. vs. Su liens, 38 Fed., 2d., 230.) Democracy cannot long endure in mindful that, on the one hand, the dignity and authority of the courts must be maintained, while, on the other, free
a country where liberty is grossly misused any more than where liberty is illegitimately abridged. speech, a free press, and the liberty of the citizen must be preserved. Both are equally valuable rights. If the court is
shorn of its power to punish for contempt in all proper cases, it cannot preserve its authority, so that even without
If the contemptuous publication made by the respondent herein were directed to this Court in connection with a any constitutional or statutory guaranty this power is inherent in the court. But the Constitution itself, in the Bill of
case already decided, the effect of the rule laid down by the majority is to deny this court the power to vindicate its Rights, guarantees free speech and liberty of the press. Of course, it was never intended, under the guise of these
dignity. The mischievous consequences that will follow from the situation thus sought to be permitted, are both too constitutional guaranties, that the power of the court should be trenched upon. 34
obvious and odious to be stated. The administration of Justice, no matter how righteous, may be identified with all
sorts of fancied scandal and corruption. Litigants, discontented for having lost their cases, will have every way to How to determine whether an act or utterance is covered by the protective mantle of the constitutional guaranty of
give vent to their resentment. Respect and obedience to Law will ultimately be shattered, and, as a consequence, liberty of the press or whether it is already outside or an abuse thereof, is an altogether different matter. We have
the utility of the courts will completely disappear. perforce to draw from tenets in American jurisprudence, although with discriminating choice, since after all our
present doctrines on contempt vis-a-vis  constitutional limitations trace their roots in the main to the lessons laid
It may be said that respect to courts cannot be compelled and that public confidence should be a tribute to judicial down and born of the social and judicial experience in that jurisdiction.
worth, virtue and intelligence. But compelling respect to courts is one thing and denying the courts the power to
vindicate themselves when outraged is another. I know of no principle of law that authorizes with impunity a The liberty of the press consists in the right to publish with impunity the truth, with good motives and for justifiable
discontented citizen to unleash, by newspaper publications, the avalanche of his wrath and venom upon courts and ends, whether it respects governments individuals; the right freely to publish whatever the citizen may please and to
judges. If he believes that a judge is corrupt and that justice has somewhere been perverted, law and order require be protected against any responsibility for so doing, except in so far as such publications, from their blasphemy,
that he follow the processes provided by the Constitution and the statutes by instituting the corresponding obscenity, or scandalous character, may be a public offense, are as by their falsehood and malice they may
proceedings for impeachment or otherwise. As Mr. Justice Palmer, in speaking of the duty of courts and court injuriously affect the standing, reputation, or pecuniary interests of individuals. The true liberty of the press is amply
officers, has wisely said: secured by permitting every man to publish his opinion; but it is due to the peace and dignity of society to inquire
Would it be just to the persons who are called upon to exercise these powers to compel them to do so, and at the into the motives of such publications, and to distinguish between those which are meant for use and reformation, and
same time allow them to be maltreated or libeled because they did so? How would a suitor like a juryman trying with an eye solely to the public good, and those which are intended merely to delude and defame. To the latter
his case who might expect he would be assaulted, beaten, his property destroyed, or his reputation blasted, in description, it is impossible that any good government should afford protection and impunity.
case he decided against his opponent? Apply the same thing to judges, or the sheriff, and how long could
organized society hold together? With reference to a judge, if he has acted corruptly, it is worse than a mere
contempt. But it is apparent it would not be right that the court of which he is a member should determine this, The liberty of the press means that anyone can publish anything he pleases, but he is liable for the abuse of this
and consequently the law has provided a plain and easy method of bringing him to justice by a petition to liberty. If he does this by scandalizing the courts of his country, he is liable to be punished for contempt. In other
Parliament; but, while the law authorizes this, it does not allow infamous charges to be made against him by words, the abuse of the privilege consists principally in not telling the truth. There is a right to publish the truth, but
persons, either in the newspapers or otherwise, with reference to how he has or shall discharge the duties of his no right to publish falsehood to the injury of others with impunity. It, therefore, does not include the right to malign
office. It must be apparent to all right thinking men that, if such were allowed to be indulged in, it must end in the courts, to libel and slander and utter the most flagrant and indecent calumnies about the court and its officers,
the usefulness of the court itself being destroyed, however righteous its judges may act. From what I have said it nor to invade the sanctuaries of the temples. Such practices and such miscreants ought to be condemned, and the
must not be supposed that I think that the decisions of the court, or the actions of the judges, or other persons courts would deserve condemnation and abolition if they did not vigorously and fearlessly punish such offenders.
composing the court, are not to be discussed; on the contrary, I would allow the freest criticism of all such acts if Such practices are an abuse of the liberty of the press, and if the slander relates to the courts, it concerns the whole
done in a fair spirit, only stopping at what must injure or destroy the court itself and bring the administration of public and is consequently punishable summarily as a criminal contempt. It is therefore the liberty of the press that is
the law into disrepute, or be an outrage on the persons whose acts are discussed, or when such discussion would guaranteed, not the licentiousness. It is the right to speak the truth, not the right to bear false witness against your
interfere with the right decision of the cause before the court. neighbor. 35

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This brings to fore the need to make a distinction between adverse criticism of the court's decision after the case is publications regarding their proceedings, present or past, upon the ground that they tend to degrade the tribunals,
ended and "scandalizing the court itself." The latter is not criticism; it is personal and scurrilous abuse of a judge as destroy public confidence and respect for their judgments and decrees, so essentially necessary to the good order
such, in which case it shall be dealt with as a case of contempt. 36 and well-being of society, and most effectually obstruct the free course of justice.

It must be clearly understood and always borne in mind that there is a vast difference between criticism or fair Then, in In re Hayes, 43 it was said that publishers of newspapers have the right, but no higher right than others, to
comment on the one side and defamation on the other. Where defamation commences, true criticism ends. True bring to public notice the conduct of the courts, provided the publications are true and fair in spirit. The liberty of the
criticism differs from defamation in the following particulars; (1) Criticism deals only with such things as invite public press secures the privilege of discussing in a decent and temperate manner the decisions and judgments of a court of
attention or call for public comment. (2) Criticism never attacks the individual but only his work. In every case the justice; but the language should be that of fair and honorable criticism, and should not go to the extent of assigning
attack is on a man's acts, or on some thing, and not upon the man himself. A true critic never indulges in to any party or the court false or dishonest motives. There is no law to restrain or punish the freest expressions of
personalities. (3) True criticism never imputes or insinuates dishonorable motives, unless justice absolutely requires disapprobation that any person may entertain of what is done in or by the courts. Under the right of freedom of
it, and then only on the clearest proofs. (4) The critic never takes advantage of the occasion to gratify private malice, speech and of the press the public has a right to know and discuss all judicial proceedings, but this does not include
or to attain any other object beyond the fair discussion of matters of public interest, and the judicious guidance of the right to attempt, by wanton defamation, groundless charges of unfairness and stubborn partisanship, to degrade
the public taste. 37 the tribunal and impair its efficiency.

Generally, criticism of a court's rulings or decisions is not improper, and may not be restricted after a case has been Finally, in Weston vs.  Commonwealth, 44 it was ruled that the freedom of speech may not be exercise in such a
finally disposed of and has ceased to be pending. So long as critics confine their criticisms to facts and base them on manner as to destroy respect for the courts, the very institution which is the guardian of that right. The dignity of the
the decisions of the court, they commit no contempt no matter how severe the criticism may be; but when they pass courts and the duty of the citizens to respect them are necessary adjuncts to the administration of justice.
beyond that line and charge that judicial conduct was influenced by improper, corrupt, or selfish motives, or that Denigrating the court by libelous attacks upon judicial conduct in an ended case, as well as one which is pending
such conduct was affected by political prejudice or interest, the tendency is to create distrust and destroy the before it, may seriously interfere with the administration of justice. While such an attack may not affect the particular
confidence of the people in their courts. 38 litigation which has been terminated, it may very well affect the course of justice in future litigation and impair, if not
destroy, the judicial efficiency of the court or judge subjected to the attack.
Moreover, it has been held that criticism of courts after a case is finally disposed of, does not constitute contempt
and, to this effect, a case may be said to be pending so long as there is still something for the court to do therein. Anent the second ground, the rule in American jurisprudence is that false and libelous utterances present a clear and
But criticism should be distinguished from insult. A criticism after a case has been disposed of can no longer influence present danger to the administration of justice. 45 To constitute contempt, criticism of a past action of the court must
the court, and on that ground it does not constitute contempt. On the other hand, an insult hurled to the court, even pose a clear and present danger to a fair administration of justice, that is, the publication must have an inherent
after a case is decided, can under no circumstance be justified. Mere criticism or comment on the correctness or tendency to influence, intimidate, impede, embarrass, or obstruct the court's administration of justice. 46 It is not
wrongness, soundness or unsoundness of the decision of the court in a pending case made in good faith may be merely a private wrong against the rights of litigants and judges, but a public wrong, a crime against the State, to
tolerated; but to hurl the false charge that the Supreme Court has been committing deliberately so many blunders undertake by libel or slander to impair confidence in the judicial functions. 47
and injustices would tend necessarily to undermine the confidence of the people in the honesty and integrity of its
members, and consequently to lower or degrade the administration of justice, and it constitutes contempt. 39 Elucidating on the matter, this Court, in Cabansag vs.  Fernandez, et al., 48 held as follows:

The Philippine rule, therefore, is that in case of a post-litigation newspaper publication, fair criticism of the court, its . . . The first, as interpreted in a number of cases, means that the evil consequence of the comment or utterance
proceedings and its members, are allowed. However, there may be a contempt of court, even though the case has must be ''extremely serious and the degree of imminence extremely high" before the utterance can be punished.
been terminated, if the publication is attended by either of these two circumstances: (1) where it tends to bring the The danger to be guarded against is the "substantive evil" sought to be prevented. And this evil is primarily the
court into disrespect or, in other words, to scandalize the court; 40 or (2) where there is a clear and present danger "disorderly and unfair administration of justice." This test establishes a definite rule in constitutional law. It
that the administration of justice would be impeded. And this brings us to the familiar invocation of freedom of provides the criterion as to what words may be published. Under this rule, the advocacy of ideas cannot
expression usually resorted to as a defense in contempt proceedings. constitutionally be abridged unless there is a clear and present danger that such advocacy will harm the
administration of Justice.
On the first ground, it has been said that the right of free speech is guaranteed by the Constitution and must be
sacredly guarded, but that an abuse thereof is expressly prohibited by that instrument and must not be permitted to Thus, speaking of the extent and scope of the application of this rule, the Supreme Court of the United States said:
destroy or impair the efficiency of the courts or the public respect therefor and the confidence therein. 41 "Clear and present danger of substantive evils as a result of indiscriminate publications regarding judicial
proceedings justifies an impairment of the constitutional right of freedom of speech and press only if the evils are
Thus, in State vs.  Morril, 42 the court said that any citizen has the right to publish the proceedings and decisions of extremely serious and the degree of imminence extremely high. . . . The possibility of engendering disrespect for
the court, and if he deems it necessary for the public good, to comment upon them freely, discuss their correctness, the judiciary as a result of the published criticism of a judge is not such a substantive evil as will justify impairment
the fitness or unfitness of the judges for their stations, and the fidelity with which they perform the important public of the constitutional right of freedom of speech and press." . . .
trusts reposed in them; but he has no right to attempt, by defamatory publications, to degrade the tribunal, destroy
public confidence in it, and dispose the community to disregard and set at naught its orders, judgments and decrees. No less important is the ruling on the power of the court to punish for contempt in relation to the freedom of
Such publications are an abuse of the liberty of the press; and tend to sap the very foundation of good order and speech and press. We quote: "Freedom of speech and press should not be impaired through the exercise of the
well-being in society by obstructing the course of justice. Courts possess the power to punish for contempt libelous power to punish for contempt of court unless there is no doubt that the utterances in question are a serious and

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 imminent threat to the administration of justice. A judge may not hold in contempt one who ventures to publish There are, however, several jurisprudentially and statutorily recognized exceptions to the general rule, both under
anything that tends to make him unpopular or to belittle him. The vehemence of the language used in newspaper Philippine and American jurisprudence, viz.:
publications concerning a judge's decision is not alone the measure of the power to punish for contempt . The fires 1. Indirect contempt committed against inferior court may also be tried by the proper regional trial court,
which it kindles must constitute an imminent, not merely a likely, threat to the administration of justice." . . . regardless of the imposable penalty. 54
2. Indirect contempt against the Supreme Court may be caused to be investigated by a prosecuting officer and the
And in weighing the danger of possible interference with the courts by newspaper criticism against the free speech charge may be filed in and tried by the regional trial court, or the case may be referred to it for hearing and
to determine whether such may constitutionally be punished as contempt, it was ruled that "freedom of public recommendation where the charge involves questions of fact. 55
comment should in borderline instances weigh heavily against a possible tendency to influence pending cases." . . . 3. In People vs.  Alarcon, et al., supra, this Court ruled that "in the interrelation of the different courts forming our
integrated judicial system, one court is not an agent or representative of another and may not, for this reason,
punish contempts in vindication of the authority and decorum which are not its own. The appeal transfers the
The question in every case, according to Justice Holmes, is whether the words used are used in such circumstances proceedings to the appellate court , and this last court becomes thereby charged with the authority to deal with
and are of such a nature as to create a clear and present danger that they will bring about the substantive evils contempts committed after the perfection of the appeal." The apparent reason is that both the moral and legal
that congress has a right to prevent. It is a question of proximity and degree. . . . effect of a punishment for contempt would be missed if it were regarded as the resentment of personal affronts
offered to judges. Contempts are punished as offenses against the administration of justice, and the offense of
Although Cabansag involved a contempt committed during the pendency of a case, no compelling reason exists why violating a judicial order is punishable by the court which is charged with its enforcement, regardless of the court
the doctrines enunciated therein should not be made applicable to vituperative publications made after the which may have made the order. 56 However, the rule presupposes a complete transfer of jurisdiction to the
termination of the case. Whether a case is pending or not, there is the constant and ever growing need to protect the appellate court, and there is authority that where the contempt does not relate to the subject matter of the appeal,
courts from a substantive evil, such as invective conduct or utterances which tend to impede or degrade the jurisdiction to punish remains in the trial court. 57
administration of justice, or which calumniate the courts and their judges. At any rate, in the case of In re 4. A court may punish contempts committed against a court or judge constituting one of its parts or agencies, as in
Bozorth, 49 it was there expressly and categorically ruled that the clear and present danger rule equally applies to the case of a court composed of several coordinate branches or divisions. 58
publications made after the determination of a case, with the court declaring that a curtailment of criticism of the 5. The biggest factor accounting for the exceptions is where the singular jurisdiction of a given matter has been
conduct of finally concluded litigation, to be justified, must be in terms of some serious substantive evil which it is transferred from the contemned court to another court. One of the most common reasons for a transfer of
designed to avert. jurisdiction among courts is improper venue. The cases involving venue deal primarily with the question whether a
change of venue is available after a contempt proceeding has been begun. While generally a change of venue is not
available in a contempt proceeding, some jurisdictions allow such a change in proper circumstances. 59
Adverting again to what was further said in State vs.  Shepherd, supra, let it here be emphasized that the protection
and safety of life, liberty, property and character, the peace of society, the proper administration of justice and even 6. A new court wholly replacing a prior court has jurisdiction to punish for violations of orders entered by its
predecessor, although where the successor court is created by a statute which does not extinguish jurisdiction in
the perpetuity of our institutions and form of government, imperatively demand that everyone — lawyer, layman,
citizen, stranger, newspaperman, friend or foe — shall treat the courts with proper respect and shall not attempt to the predecessor, an affirmative transfer of jurisdiction before the contempt occurs is necessary to empower the
successor court to act. 60
degrade them, or impair the respect of the people, or destroy the faith of the people in them. When the temples of
justice become polluted or are not kept pure and clean, the foundations of free government are undermined, and the 7. Transfers of jurisdiction by appellate review have produced numerous instances where contempt against the trial
court has been punished in the appellate court, and vice versa. Some appellate courts have taken the view that a
institution itself threatened.
contempt committed after an appeal is taken is particularly contemptuous of the appellate court because of the
tendency of such contempts to upset the status quo or otherwise interfere with the jurisdiction of such court. 61
III. Jurisdiction in Contempt Proceedings where the Alleged Contumely is Committed Against 8. A judge may disqualify himself, or be disqualified, on a contempt hearing or in the main case, which
a Lower Court while the Case is Pending in the Appellate or Higher Court circumstance may require a transfer of jurisdiction, but where a judge is disqualified only in the main case, because
of matters which do not disqualify him in a contempt proceeding, the regular judge should sit in the contempt
In whatever context it may arise, contempt of court involves the doing of an act, or the failure to do an act, in such a proceeding. Likewise, where the regular judge, is absent or otherwise unavailable and an order is entered by
manner as to create an affront to the court and the sovereign dignity with which it is clothed. As a matter of practical another judge and made returnable to the proper court, the regular judge may punish for violations of orders so
judicial administration, jurisdiction has been felt properly to rest in only one tribunal at a time with respect to a given entered. 62
controversy. Partly because of administrative considerations, and partly to visit the full personal effect of the 9. Where the same act is a contempt against two or more courts, it is no bar to contempt proceedings in one of
punishment on a contemnor, the rule has been that no other court than the one contemned will punish a given them that there is also a contempt against the other. 63
contempt. 50 10. While professional disciplinary proceedings have been resorted to as a punishment for contempt, the more
recent view is that punishment is of secondary importance to the need to protect the courts and the people from
improper professional practice. To the substantial extent that disciplinary action remains a punishment, disciplinary
The rationale that is usually advanced for the general rule that the power to punish for contempt rests with the court
measures imposed by another court than the one contemned furnish an exception to the rule against punishing for
contemned is that contempt proceedings are sui generis and are triable only by the court against whose authority the
contempt of another court. 64
contempt are charged; 51 the power to punish for contempt exists for the purpose of enabling a court to compel due
11. Some contemptuous acts are also crime, usually misdemeanors, which are often punishable in other courts
decorum and respect in its presence and due obedience to its judgments, orders and processes: 52 and in order that a
than those against which the contemptuous act was done. 65
court may compel obedience to its orders, it must have the right to inquire whether there has been any disobedience
12. Finally, a conviction for contempt against another court has been allowed to stand on the basis that the failure
thereof, for to submit the question of disobedience to another tribunal would operate to deprive the proceeding of
of the defendant to make timely objection operated as a waiver of the right to be tried before the court actually
half its efficiency. 53
contemned. 66

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The rule, as now accepted and deemed applicable to the present incident, is that where the entire case has already and we thereby embolden the licentious to trample upon everything sacred in society, and to overturn those
been appealed, jurisdiction to punish for contempt rests with the appellate court where the appeal completely institutions which have hitherto been deemed the best guardians of civil liberty. 73
transfers the proceedings thereto or where there is a tendency to affect the status quo or otherwise interfere with the
jurisdiction of the appellate court. Accordingly, this Court having acquired jurisdiction over the complaint for indirect Hence, the suggestion that judges who are unjustly attacked have a remedy in an action for libel, has been assailed
contempt against herein respondents, it has taken judicial cognizance thereof and has accordingly resolved the same. as being without rational basis in principle. In the first place, the outrage is not directed to the judge as a private
individual but to the judge as such or to the court as an organ of the administration of justice. In the second place,
IV. Appropriate Remedies where the Alleged Contemptuous Statement is also Claimed to be Libelous public interests will gravely suffer where the judge, as such, will, from time to time, be pulled down and disrobed of
his judicial authority to face his assailant on equal grounds and prosecute cases in his behalf as a private individual.
Under the American doctrine, to repeat, the great weight of authority is that in so far as proceedings to punish for The same reasons of public policy which exempt a judge from civil liability in the exercise of his judicial functions,
contempt are concerned, critical comment upon the behavior of the court in cases fully determined by it is most fundamental of which is the policy to confine his time exclusively to the discharge of his public duties, applies
unrestricted, under the constitutional guaranties of the liberty of the press and freedom of speech. Thus, comments, here with equal, if not superior, force. 74
however stringent, which have relation to judicial proceedings which are past and ended, are not contemptuous of
the authority of the court to which reference is made. Such comments may constitute a libel against the judge, but it V. Whether or not the Same Contemptuous Conduct of a Member of the Bar can be the
cannot be treated as in contempt of the court's authority. Subject of both a Contempt Proceeding and an Administrative Disciplinary Action

On this score, it is said that prosecution for libel is usually the most appropriate and effective remedy. 67 The force of With the foregoing discussion of the appropriate remedies available to a judge, we feel that this issue with respect to
American public opinion has greatly restrained the courts in the exercise of the power to punish one as in contempt proper remedies against an erring member or the Bar should consequentially be addressed, by way of reiteration,
for making disrespectful or injurious remarks, and it has been said that the remedy of a judge is the same as that since conflicting and erroneous remedies are sometimes resorted to by aggrieved tribunals or parties.
given to a private citizen. 68 In such a case, therefore. the remedy of a criminal action for libel is available to a judge
who has been derogated in a newspaper publication made after the termination aid a case tried by him, since such The basic rule here is that the power to punish for contempt and the power to disbar are separate and distinct, and
publication can no longer be made subject of contempt proceedings. that the exercise of one does not exclude the exercise of the other. 75 A contempt proceeding for misbehavior in court
is designed to vindicate the authority of the court; on the other hand, the object of a disciplinary proceeding is to
The rule, however, is different in instances under the Philippine doctrine earlier discussed wherein there may still be deal with the fitness of the court's officer to continue in that office, to preserve and protect the court and the public
a contempt of court even after a case has been decided and terminated. In such case, the offender may be cited for from the official ministrations of persons unfit or unworthy to hold such office. 76 The principal purpose of the exercise
contempt for uttering libelous remarks against the court or the judge. The availability, however, of the power to of the power to cite for contempt is to safeguard the functions of the court and should thus be used sparingly on a
punish for contempt does not and will not prevent a prosecution for libel, either before, during, or after the institution preservative and not, on the vindictive principle. 77 The principal purpose of the exercise of disciplinary authority by
of contempt proceedings. In other words, the fact that certain contemptuous conduct likewise constitutes an the Supreme Court is to assure respect for orders of such court by attorneys who, as much as judges, are
indictable libel against the judge of the court contemned does not necessarily require him to bring a libel action, responsible for the orderly administration of justice. 78
rather than relying on contempt Proceedings. 69
Moreover, it has been held that the imposition a fine as a penalty in a contempt proceeding is not considered res
The fact that an act constituting a contempt is also criminal and punishable by indictment. or other method of judicata  to a subsequent charge for unprofessional conduct. 79 In the same manner an attorney's conviction for
criminal prosecution does not prevent the outraged Court from punishing the contempt. 70 This principle stems from contempt was not collaterally estopped by reason of a subsequent disbarment proceeding in which the court found in
the fundamental doctrine that an act may be punished as a contempt even though it has been punished as a criminal his favor on essentially the same facts leading to conviction. 80 It has likewise been the rule that a notice to a lawyer
offense. 71 The defense of having once been in jeopardy, based on a conviction for the criminal offense, would not lie to show cause why he should not be punished for contempt cannot be considered as a notice to show cause why he
in bar of the contempt proceedings, on the proposition that a contempt may be an offense against the dignity of a should not be suspended from the practice of law, considering that they have distinct objects and for each of them a
court and, at the same time, an offense against the peace and dignity of the people of the State. 72 But more different procedure is established. Contempt of court is governed by the procedures laid down under Rule 71 of the
importantly. adherence to the American doctrine by insisting that a judge should instead file an action fur libel will Rules of Court, whereas disciplinary actions in the Practice of law are governed by file 138 and 139 thereof. 81
definitely give rise to an absurd situation and may even cause more harm than good.
Although apparently different in legal bases, the authority to punish for contempt and to discipline lawyers are both
Drawing also from American jurisprudence, to compel the judge to descend from the plane of his judicial office to the inherent in the Supreme Court and are equally incidents of the court's basic power to oversee the proper
level of the contemnor, pass over the matter of contempt, and instead attack him by a civil action to satisfy the administration of justice and the orderly discharge of judicial functions. As was succinctly expounded in Zaldivar
judge in damages for a libel, would be a still greater humiliation of a court. That conduct would be personal; the vs.  Sandiganbayan, et al.: 82
court is impersonal. In our jurisdiction, the judicial status is fixed to such a point that our courts and the judges There are, in other words, two (2) related powers which come into play in cases like that before us here: the
thereof should be protected from the improper consequences of their discharge of duties so much so that judicial Court's inherent power to discipline attorneys and the contempt power. The disciplinary authority of the Court over
officers have always been shielded, on the highest considerations of the public good, from being called for members of the Bar is broader than the power to punish for contempt. Contempt of court may be committed both
questioning in civil actions for things done in their judicial capacity. by lawyers and non-lawyers, both in and out of court. Frequently, where the contemnor is a lawyer, the
contumacious conduct also constitutes professional misconduct which calls into play the disciplinary authority of the
Whenever we subject the established courts of the and to the degradation of private prosecution, we subdue their Supreme Court. Where the respondent is a lawyer, however, the Supreme Court's disciplinary authority over
independence, and destroy their authority. instead of being venerable before the public, they become contemptible; lawyers may come into play whether or not the misconduct with which the respondent is charged also constitutes

85
 contempt of court. The power to punish for contempt of court does not exhaust the scope of disciplinary authority The petitioners filed this petition to charge the respondents with indirect contempt of court for including allegedly
of the Court over lawyers. The disciplinary authority of the Court over members of the Bar is but corollary to the contemptuous statements in their so-called Sea Transport Update concerning the Court’s resolutions dated June 5,
court's exclusive power of admission to the bar. A lawyer is not merely a professional but also an officer of the 2002 and August 12, 2002 issued in G.R. No. 152914 entitled Distribution Management Association of the Philippines,
court and as such, he is called upon to share in the task and responsibilities of dispensing justice and resolving et al. v. Administrator Oscar Sevilla, Maritime Industry Authority, et al.
disputes in society. Any act on his part which visibly tends to obstruct, pervert, or impede and degrade the
administration of justice constitutes both professional misconduct calling for the exercise of disciplinary action Antecedents
against him, and contumacious conduct warranting application of the contempt power.

On June 4, 2001, the Maritime Industry Authority (MARINA) issued a Letter-Resolution, 1 advising respondent
With this rounding out of the subordinate and principal issues in resolving the incident, we feel that the guidelines we Distribution Management Association of the Philippines (DMAP) that a computation of the required freight rate
have laid down will provide assertive references for the lower courts in disciplinary matters arising before them. adjustment by MARINA was no longer required for freight rates officially considered or declared deregulated in
Coming back to the incident fore resolution, arising as a spin-off from the criminal cases at bar, we reiterate what we accordance with MARINA Memorandum Circular No. 153 (MC 153).
have declared at the outset, absolving judge for the reasons therein stated.

For clarity, MARINA issued MC 153 pursuant to Executive Order No. 213 (EO 213) entitled Deregulating Domestic
WHEREFORE, on the foregoing premises, the complaint for indirect contempt against herein respondents Mauricio Shipping Rates promulgated by President Fidel V. Ramos on November 24, 1994.2
Reynoso, Jr. and Eva P. Ponce de Leon is hereby DISMISSED.

On July 2, 2001, in order to challenge the constitutionality of EO 213, MC 153, and the Letter-Resolution dated June
4, 2001, DMAP commenced in the Court of Appeals (CA) a special civil action for certiorari and prohibition, with
prayer for preliminary mandatory injunction or temporary restraining order (CA-G.R. SP No. 65463). On November
29, 2001,3 however, the CA dismissed the petition for certiorari and prohibition and upheld the constitutionality of EO
213, MC 153, and the Letter-Resolution dated June 4, 2001. 4 Later, on April 10, 2002, the CA denied DMAP’s motion
for reconsideration.5

DMAP appealed to the Court (G.R. No. 152914), but on June 5, 2002, 6 the Court denied DMAP’s petition for review on
certiorari "for petitioners’ failure to: (a) take the appeal within the reglementary period of fifteen (15) days in
accordance with Section 2, Rule 45 in relation to Section 5(a), Rule 56, in view of the foregoing denial of petitioners'
motion for extension of time to file the petition; and (b) pay the deposit for sheriff's fee and clerk's commission in the
total amount of ₱202.00 in accordance with Sections 2 and 3, Rule 45 in relation to Section [c], Rule 56 and
paragraph 1 of Revised Circular No. 1-88 of this Court."

On August 12, 2002,7 the Court denied with finality DMAP’s motion for reconsideration.

In October 2002, DMAP held a general membership meeting (GMM) on the occasion of which DMAP, acting through
its co-respondents Lorenzo Cinco, its President, and Cora Curay, a consultant/adviser to Cinco, publicly circulated the
Sea Transport Update,8 which is reproduced as follows:

SEA TRANSPORT UPDATE

Oct. 2002 GMM
20% GRI RATE INCREASE ISSUE
1. The Motion for Reconsideration filed with the Supreme Court was denied based on technicalities and not on the
legal issue DMAP presented.
Small technical matter which should not be a cause for denial (like the amount of filing fee lacking & failure to
G.R. No. 155849               August 31, 2011 indicate date of receipt of court resolution)
> Some technical matters that could cause denial
LORENZO SHIPPING CORPORATION, OCEANIC CONTAINER LINES, INC., SOLID SHIPPING LINES - Failure to file on time and to file necessary pleadings
CORPORATION, SULPICIO LINES, INC., ET AL., Petitioners, - Failure to provide copies to respondents.
vs. > Legal issue DMAP presented
DISTRIBUTION MANAGEMENT ASSOCIATION OF THE PHILIPPINES, LORENZO CINCO, and CORA - Public Service Act
CURAY, Respondents. - Regulated or Deregulated
- MC 153

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 - Supreme Court ruling issued in one month only, normal leadtime is at least 3 to 6 months. issuances, and did not include any determination of the reasonableness and propriety of the 20% increase; that,
WHAT TO EXPECT? accordingly, the discussion of the recourse with respect to the 20% increase, which was to go back to MARINA for the
1. Liners will pressure members to pay the 20% GRI resolution on the matter, could not be considered as a defiance of the order of the Court because the CA itself
WHAT TO DO? decreed that the propriety and reasonableness of the 20% increase should be brought to and resolved by
1. As advised by DMAP counsel, use the following arguments: MARINA;19 and that considering that there was yet no entry of judgment in relation to the denial of the petition at the
- DMAP case was denied based on technicalities and not on merits of the case time of the GMM on October 17, 2002, the respondents were not defying any final order or writ of the Court and
- Court of Appeals has ruled that computation of reasonableness of freight is not under their jurisdiction but thereby commit any act of indirect contempt.20
with MARINA
- DSA's argument that DMAP's case prematurely (sic) file (sic) as there is a pending case filed before Issue
MARINA.
- Therefore, DSA & DMAP will be going back to MARINA for resolution
2. Meantime, DMAP members enjoined not to pay until resolved by MARINA Did the statements contained in the Sea Transport Update constitute or amount to indirect contempt of court?
3. However, continue collaboration with liners so shipping service may not suffer
NEXT MOVE Ruling
Another group (most likely consumers) or any party will file the same case and may be using the same arguments.
(emphasis supplied) We dismiss the petition.

Thereupon, the petitioners brought this special civil action for contempt against the respondents, insisting that the
I. Contempt of Court: Concept and Classes
publication of the Sea Transport Update constituted indirect contempt of court for patently, unjustly and baselessly
insinuating that the petitioners were privy to some illegal act, and, worse, that the publication unfairly debased the
Supreme Court by making "scurrilous, malicious, tasteless, and baseless innuendo" 9 to the effect that the Supreme Contempt of court has been defined as a willful disregard or disobedience of a public authority. In its broad sense,
Court had allowed itself to be influenced by the petitioners as to lead the respondents to conclude that the "Supreme contempt is a disregard of, or disobedience to, the rules or orders of a legislative or judicial body or an interruption of
Court ruling issued in one month only, normal lead time is at least 3 to 6 months." 10 They averred that the its proceedings by disorderly behavior or insolent language in its presence or so near thereto as to disturb its
respondents’ purpose, taken in the context of the entire publication, was to "defy the decision, for it was based on proceedings or to impair the respect due to such a body. In its restricted and more usual sense, contempt
technicalities, and the Supreme Court was influenced!"11 comprehends a despising of the authority, justice, or dignity of a court.21 The phrase contempt of court is generic,
embracing within its legal signification a variety of different acts.22

In their comment dated January 20, 2003,12 the respondents denied any intention to malign, discredit, or criticize the
Court.13 They explained that their statement that the "Supreme Court ruling issued in one month time only, normal The power to punish for contempt is inherent in all courts, 23 and need not be specifically granted by statute.24 It lies
lead time is at least three to six months" 14 was not per se contemptuous, because the normal and appropriate time at the core of the administration of a judicial system.25 Indeed,  there ought to be no question that courts have the
frame for the resolution of petitions by the Court was either less than a month, if the petition was to be denied on power by virtue of their very creation to impose silence, respect, and decorum in their presence, submission to their
technicality, and more or less from three to six months, if the petition was to be given due course; that what made lawful mandates, and to preserve themselves and their officers from the approach and insults of pollution. 26 The
the petitioners describe the statement as contemptuous was not the real or actual intention of the author but rather power to punish for contempt essentially exists for the preservation of order in judicial proceedings and for the
the petitioners’ false, malicious, scurrilous and tasteless insinuations and interpretation; and that the petitioners, not enforcement of judgments, orders, and mandates of the courts, and, consequently, for the due administration of
being themselves present during the GMM, had no basis to assert that the DMAP’s presentor, the author of the justice.27 The reason behind the power to punish for contempt is that respect of the courts guarantees the stability of
material, or any of the speakers during the GMM had any evil intention or made any malicious insinuations.15 their institution; without such guarantee, the institution of the courts would be resting on a very shaky foundation.28

The respondents further stated that the term time frame was layman’s parlance to explain to DMAP members that Contempt of court is of two kinds, namely: direct contempt, which is committed in the presence of or so near the
the petition had been dismissed due to a technicality, considering that the appeals process in the case before the judge as to obstruct him in the administration of justice; and constructive or indirect contempt, which consists of
Court had taken only a month instead of the expected three to six months; 16 that the term lead time, although not willful disobedience of the lawful process or order of the court.29
the proper legal term to describe the process that the respondents’ petition had undergone in the Court, was
common parlance in the business sector in which the respondents belonged; that the discussions during the The punishment for the first is generally summary and immediate, and no process or evidence is necessary because
presentation focused on the legal options of DMAP with respect to the 20% increase, i.e., to go back to MARINA for the act is committed in facie curiae. 30 The inherent power of courts to punish contempt of court committed in the
the resolution of the propriety and reasonableness of the 20% increase; 17 that a lead time was indicated in the presence of the courts without further proof of facts and without aid of a trial is not open to question, considering
presentation material simply to tell DMAP members that the lead time to go back to MARINA had been cut short in that this power is essential to preserve their authority and to prevent the administration of justice from falling into
view of the denial of the petition for review; and that, on the other hand, had the Court given due course to the disrepute; such summary conviction and punishment accord with due process of law.31 There is authority for the
petition, the expected time for the Court to resolve the appeal on the merits would have been from three to six view, however, that an act, to constitute direct contempt punishable by summary proceeding, need not be committed
months, a normal expectation.18 in the immediate presence of the court, if it tends to obstruct justice or to interfere with the actions of the court in
the courtroom itself.32 Also, contemptuous acts committed out of the presence of the court, if admitted by the
Lastly, the respondents submitted that a serious study and analysis of the decision of the CA, which the Court contemnor in open court, may be punished summarily as a direct contempt,33 although it is advisable to proceed by
affirmed, revealed that the decision of the CA centered only on the constitutionality of the assailed executive requiring the person charged to appear and show cause why he should not be punished when the judge is without

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personal knowledge of the misbehavior and is informed of it only by a confession of the contemnor or by testimony and to be heard by himself or counsel, a person guilty of any of the following acts may be punished for indirect
under oath of other persons.34 contempt:
(a) Misbehavior of an officer of a court in the performance of his official duties or in his official transactions;
In contrast, the second usually requires proceedings less summary than the first. The proceedings for the (b) Disobedience of or resistance to a lawful writ, process, order, or judgment of a court, including the act of a
punishment of the contumacious act committed outside the personal knowledge of the judge generally need the person who, after being dispossessed or ejected from any real property by the judgment or process of any court
observance of all the elements of due process of law, that is, notice, written charges, and an opportunity to deny and of competent jurisdiction, enters or attempts or induces
to defend such charges before guilt is adjudged and sentence imposed.35 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
Plainly, therefore, the word summary with respect to the punishment for contempt refers not to the timing of the contempt under section 1 of this Rule;
action with reference to the offense but to the procedure that dispenses with the formality, delay, and digression that (d) Any improper conduct tending, directly or indirectly, to impede, obstruct, or degrade the administration of
result from the issuance of process, service of complaint and answer, holding hearings, taking evidence, listening to justice;
arguments, awaiting briefs, submission of findings, and all that goes with a conventional court trial.36 (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;
A distinction between in-court contempts, which disrupt court proceedings and for which a hearing and formal (g) The rescue, or attempted rescue, of a person or property in the custody of an officer by virtue of an order or
presentation of evidence are dispensed with, and out-of-court contempts, which require normal adversary process of a court held by him.
procedures, is drawn for the purpose of prescribing what procedures must attend the exercise of a court’s authority
to deal with contempt. The distinction does not limit the ability of courts to initiate contempt prosecutions to the But nothing in this section shall be so construed as to prevent the court from issuing process to bring the respondent
summary punishment of in-court contempts that interfere with the judicial process.37 into court, or from holding him in custody pending such proceedings. (3a)

The court may proceed upon its own knowledge of the facts without further proof and without issue or trial in any Misbehavior means something more than adverse comment or disrespect.48 There is no question that in contempt the
form to punish a contempt intent goes to the gravamen of the offense. 49 Thus, the good faith, or lack of it, of the alleged contemnor should be
considered.50 Where the act complained of is ambiguous or does not clearly show on its face that it is contempt, and
committed directly under its eye or within its view. 38 But there must be adequate facts to support a summary order is one which, if the party is acting in good faith, is within his rights, the presence or absence of a contumacious intent
for contempt in the presence of the court.39 The exercise of the summary power to imprison for contempt is a is, in some instances, held to be determinative of its character.51 A person should not be condemned for contempt
delicate one and care is needed to avoid arbitrary or oppressive conclusions. 40 The reason for the extraordinary where he contends for what he believes to be right and in good faith institutes proceedings for the purpose, however
power to punish criminal contempt in summary proceedings is that the necessities of the administration of justice erroneous may be his conclusion as to his rights.52 To constitute contempt, the act must be done willfully and for an
require such summary dealing with obstructions to it, being a mode of vindicating the majesty of the law, in its active illegitimate or improper purpose.53
manifestation, against obstruction and outrage.41
Unfounded accusations or allegations or words tending to embarrass the court or to bring it into disrepute have no
Proceedings for contempt are sui generis, in nature criminal, but may be resorted to in civil as well as criminal place in a pleading. Their employment serves no useful purpose. On the contrary, they constitute direct contempt of
actions, and independently of any action. 42 They are of two classes, the criminal or punitive, and the civil or court or contempt in facie curiae and, when committed by a lawyer, a violation of the lawyer’s oath and a
remedial.  A criminal contempt consists in conduct that is directed against the authority and dignity of a court or of a transgression of the Code of Professional Responsibility.
judge acting judicially, as in unlawfully assailing or discrediting the authority and dignity of the court or judge, or in
doing a duly forbidden act. A civil contempt consists in the failure to do something ordered to be done by a court or II. Utterances in Sea Transport Update, Not Contemptuous
judge in a civil case for the benefit of the opposing party therein. 43 It is at times difficult to determine whether the
proceedings are civil or criminal. In general, the character of the contempt of whether it is criminal or civil is
determined by the nature of the contempt involved, regardless of the cause in which the The petitioners did not sufficiently show how the respondents’ publication of the Sea Transport Update constituted
any of the acts punishable as indirect contempt of court under Section 3 of Rule 71, supra.

contempt arose, and by the relief sought or dominant purpose. 44 The proceedings are to be regarded as criminal
when the purpose is primarily punishment, and civil when the purpose is primarily compensatory or The petitioners’ mere allegation, that "said publication unfairly debases the Supreme Court because of the scurrilous,
remedial.45 Where the dominant purpose is to enforce compliance with an order of a court for the benefit of a party in malicious, tasteless, and baseless innuendo therein that the Court allowed itself to be influenced by the petitioners as
whose favor the order runs, the contempt is civil; where the dominant purpose is to vindicate the dignity and concocted in the evil minds of the respondents thus leading said respondents to unjustly conclude: Supreme Court
authority of the court, and to protect the interests of the general public, the contempt is criminal. 46 Indeed, the ruling issued in one month only, normal lead time is at least 3 to 6 months,"54 was insufficient, without more, to
criminal proceedings vindicate the dignity of the courts, but the civil proceedings protect, preserve, and enforce the sustain the charge of indirect contempt.
rights of private parties and compel obedience to orders, judgments and decrees made to enforce such rights. 47
Nor do we consider contemptuous either the phrase contained in the Sea Transport Update stating: "The Motion for
Indirect contempt is defined by and punished under Section 3, Rule 71 of the Rules of Court, which provides: Reconsideration filed with the Supreme Court was denied based on technicalities and not on the legal issue DMAP
Section 3. Indirect contempt to be punished after charge and hearing. — After a charge in writing has been filed, presented",55 or the phrase in the Sea Transport Update reading "Supreme Court ruling issued in one month only,
and an opportunity given to the respondent to comment thereon within such period as may be fixed by the court normal leadtime is at least 3 to 6 months." Contrary to the petitioners’ urging that such phrases be considered as

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"scurrilous, malicious, tasteless and baseless innuendo" 56 and as indicative that "the Court allowed itself to be RAMON D. MONTENEGRO, petitioner,
influenced by the petitioners"57 or that "the point that respondents wanted to convey was crystal clear: ‘defy the vs.
decision, for it was based on technicalities, and the Supreme Court was influenced!’",58 we find the phrases as not MA. TERESA L. MONTENEGRO, for herself and as the mother and natural guardian of the minors,
critical of the Court and how fast the resolutions in G.R. No. 152914 were issued, or as inciting DMAP’s members to ANTONIO AMELO and ANA MARIA PIA ISABEL, both surnamed "MONTENEGRO," respondents.
defy the resolutions. The unmistakable intent behind the phrases was to inform DMAP’s members of the
developments in the case, and on the taking of the next viable move of going back to MARINA on the issues, as the In this petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure, petitioner Ramon D.
ruling of the Court of Appeals instructed.1avvphi1 Montenegro seeks the reversal of the 8 November 2002 Order1 in Civil Case No. 94-8467 of the Regional Trial Court,
Branch 41, Bacolod City, holding him guilty of indirect contempt for his repeated failure to appear at the scheduled
We have long recognized and respected the right of a lawyer, or of any other person, for that matter, to be critical of hearings for his examination as judgment obligor and imposing on him the penalty of three (3) months imprisonment
the courts and their judges as long as the criticism is made in respectful terms and through legitimate channels. We and a fine of twenty thousand pesos (₱20,000), and of the subsequent 3 January 2003 Order2 denying his motion for
have no cause or reason to depart from such recognition and respect, for the Court has long adhered to the the reconsideration of the 8 November 2002 Order.
sentiment aptly given expression to in the leading case of In re: Almacen:59
xxx every citizen has the right to comment upon and criticize the actuations of public officers. This right is not On 14 June 1994, respondent Ma. Teresa V. Lizares-Montenegro (hereinafter, respondent Teresa), for herself and as
diminished by the fact that the criticism is aimed at a judicial authority, or that it is articulated by a lawyer. Such mother and guardian of her two minor children Antonio Amelo and Ana Maria Pia Isabel, filed with the trial court
right is especially recognized where the criticism concerns a concluded litigation, because then the court’s actuation below a complaint for support against her husband, herein petitioner Ramon D. Montenegro. The case was docketed
are thrown open to public consumption. as Civil Case No. 94-8467. Four years after the filing of the complaint, petitioner and respondent Teresa executed a
xxx compromise agreement which was submitted to the trial court for approval on 13 October 1998. On the same date,
Courts and judges are not sacrosanct. They should and expect critical evaluation of their performance. For like the the trial court rendered a Decision approving the compromise agreement and ordering the parties to comply with it.
executive and the legislative branches, the judiciary is rooted in the soil of democratic society, nourished by the The parties did not appeal from the Decision; hence, it became final and executory.
periodic appraisal of the citizens whom it is expected to serve.
Well-recognized therefore is the right of a lawyer, both as an officer of the court and as a citizen, to criticize in
properly respectful terms and through legitimate channels the acts of courts and judges.xxx Under the terms of the compromise agreement, petitioner obligated himself to:
xxx (1) Pay the respondent the amount of One Million Pesos (₱1,000,000) representing her entire share in their
Hence, as a citizen and as officer of the court, a lawyer is expected not only to exercise the right, but also to conjugal partnership of gains, Five Hundred Thousand (₱500,000) of which is payable upon signing of the
consider it his duty to avail of such right. No law may abridge this right. Nor is he "professionally answerable for a compromise agreement while the remaining balance of Five Hundred Thousand (₱500,000) must be paid within one
scrutiny into the official conduct of the judges, which would not expose him to legal animadversion as a citizen." (1) year from the execution of the compromise agreement.
xxx (2) Establish a trust fund in the amount of Three Million Pesos (₱3,000,000) in favor of his children Antonio Amelo
xxx and Ana Maria Pia Isabel within sixty (60) days from the approval of the compromise agreement.
But it is the cardinal condition of all such criticism that it shall be bona fide, and shall not spill over the walls of (3) Obtain an educational plan or an investment plan to cover tuition and other matriculation fees for the college
decency and propriety. A wide chasm exists between fair criticism, on the one hand, and abuse and slander of education of Ana Maria Pia Isabel within one (1) year from the approval of the compromise agreement.
courts and the judges thereof, on the other. Intemperate and unfair criticism is a gross violation of the duty of
respect to courts. It is such a misconduct that subjects a lawyer to disciplinary action. (bold emphasis supplied)60 Since petitioner failed to comply with his obligations under the compromise agreement despite the lapse of the
periods provided therein, respondent Teresa filed a motion for the execution of the judgment. The trial court granted
The test for criticizing a judge’s decision is, therefore, whether or not the criticism is bona fide or done in good faith, the motion and issued a writ of execution on 15 February 1999.
and does not spill over the walls of decency and propriety. Viewed through the prism of the test, the Sea Transport
Update was not disrespectful, abusive, or slanderous, and did not spill over the walls of decency and propriety. A second writ of execution and a notice of garnishment, issued by the trial court on 21 May 2001 and and a notice of
Thereby, the respondents were not guilty of indirect contempt of court. In this regard, then, we need to remind that garnishment issued on 28 May 2001 weon 28 May 2001, respectively, were returned unsatisfied.
the power to punish for contempt of court is exercised on the preservative and not on the vindictive principle, and
only occasionally should a court invoke its inherent power in order to retain that respect without which the
In several conferences3 called by the trial court, petitioner admitted his failure to comply with his obligations under
administration of justice must falter or fail.61 As judges we ought to exercise our power to punish contempt the compromise agreement but alleged that he was no longer in a position to do so as he was already insolvent. In
judiciously and sparingly, with utmost restraint, and with the end in view of utilizing the power for the correction and
the conference held on 6 March 2002, respondent Teresa manifested that she would file a motion for examination of
preservation of the dignity of the Court, not for retaliation or vindictiveness.62 petitioner as judgment obligor. The trial court gave her 30 days within which to file the appropriate motion and
informed petitioner that he would have 30 days to file a comment or reply to the motion.
WHEREFORE, the petition for indirect contempt is DISMISSED.
On 14 March 2002, respondent Teresa filed a motion to examine petitioner as judgment obligor under Sections 36
and 38 of Rule 39 of the Rules of Court. In her motion, she alleged that there is an urgency for the examination to be
conducted at the earliest time since petitioner was about to migrate to Canada. Acting on the said motion, the trial
G.R. No. 156829             June 8, 2004 court issued on 19 March 2002 an Order granting the motion for examination of petitioner as judgment obligor and
setting his examination on 22 March 2002. On the same day the motion for examination was granted, petitioner filed
with the court a Manifestation alleging that the grant of the motion for examination iwas premature because he still

89
would have 30 days from receipt of the motion, or until April 14, 2002, within which to file a comment or opposition In its Order of 8 November 2002, the trial court declared petitioner in contempt of court under Section 38 of Rule 39
thereto as agreed upon during the conference on 6 March 2002. of the Rules of Court5 and imposed on him the penalty of imprisonment for three months and ordered him to pay a
fine of ₱20,000. His motion for reconsideration of the Order having been denied by the trial court in its Order of 3
Thus, oOn 22 March 2002, neither petitioner nor his counsel appeared for the scheduled hearing. On that date, the January 2003, petitioner filed the petition in the case at bar.
trial court issued an order re-scheduling the hearing to 10 April 2002 and requiring the petitioner to explain why he
should not be held in contempt of court for disobeying the 19 March 2002 Order. The petition raises pure questions of law. After the issues were joined, we resolved to give due course to the petition.

On 26 March 2002, petitioner filed a Compliance with Motion to Re-schedule Proceedings. He explained that he did Having raised only questions of law, petitioner is bound by the trial court’s findings of fact.
not attend the 22 March 2002 hearing because he was under the impression that he still had 30 days from the filing
of the motion to examine him as judgment obligor within which to respond to the motion; besides, his counsel was The core issue to be determined is whether, based on the facts found by the trial court, the latter erred in holding the
not available on 22 March 2002 due to previously scheduled hearings. petitioner guilty of indirect contempt for willfully disobeying the orders of the trial court requiring him to appear for
purposes of examination as a judgment obligor at in the hearings scheduled on 22 March 2002, 10 April 2002, and
At the hearing on 4 April 2002 of the Compliance with Motion to Re-schedule Proceedings, counsel for petitioner 23 October 2002.
manifested that his client already left for Canada on 26 March 2002 and will be unable to attend the 10 April 2002
hearing, and that petitioner would be available for examination on the last week of July or first week of August 2002. We rule in the negative.
Counsel prayed that the hearing be thus reset accordingly. The trial court denied the motion and informed the parties
that the hearing scheduled on 10 April 2002 will proceed as scheduled.
The totality of petitioner’s acts clearly indicated a deliberate, and unjustified refusal to be examined as a judgment
obligor at the time the examination was scheduled for hearing by the trial court. His Such acts tended to degrade the
On 5 April 2002, petitioner filed a manifestation reiterating that he would be unable to attend the 10 April 2002 authority and respect for court processes and impaired the judiciary’s duty to deliver and administer justice.
hearing because he was already in Canada. Counsel for petitioner likewise manifested that he would also be Petitioner tried to impose his will on the trial court.
unavailable on the said date because he would be in Manila to attend to his other cases.

Contempt of court involves the doing of an act, or the failure to do an act, in such a manner as to create an affront to
On 17 June 2002, the trial court issued an Order directing the petitioner to show cause why he should not held in the court and the sovereign dignity with which it is clothed. 6 It is defined as "disobedience to the court by acting in
contempt of court for failure to appear on the 10 April 2002 at the hearing for his examination as judgment obligor. opposition to its authority, justice and dignity."7 The power to punish contempt is inherent in all courts, because it is
In his Compliance and Explanation filed on 28 June 2002, petitioner alleged that he was unable to attend the 10 April essential to the preservation of order in judicial proceedings, and to the enforcement of judgments, orders and
2002 hearing because he was in Canada and had no intention to abscond from his obligation. mandates of the courts; and, consequently, to the due administration of justice.8

On 13 June 2002, the trial court issued an Order setting the case for the hearing for examination of the petitioner on The Rules of Court penalizes two types of contempt, namely, direct contempt and indirect contempt. Direct contempt
3 July 2002. A subpoena was issued against the petitioner and served at his address of record. Respondent Teresa is committed in the presence of or so near a court as to obstruct or interrupt the proceedings before the same, and
also caused the service of the subpoena at 8051 Estrella Avenue, San Antonio Village, Makati City where petitioner is includes disrespect toward the court, offensive personalities toward others, or refusal to be sworn or to answer as a
allegedly residing. witness, or to subscribe an affidavit or deposition when lawfully required to do so.9

The 3 July 2002 hearing did not push through as the petitioner filed a Motion to Quash Subpoena Ad On the other hand, Section 3 of Rule 71 of the Rules of Court enumerates particular acts which constitute indirect
Testificandum4 on 28 June 2002. In the motion, petitioner admitted that 8051 Estrella Avenue, San Antonio Village, contempt, thus:
Makati City, is his present address but alleged that Makati City is more than 100 kilometers away from Bacolod City; (a) Misbehavior of an officer of a court in the performance of his official duties or in his official transactions;
thus, he may not be compelled by subpoena to attend the 3 July 2002 hearing in Bacolod City. In this motion, (b) Disobedience of or resistance to a lawful writ, process, order, or judgment of a court, including the act of a
petitioner did not allege that he was still in Canada. 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
In its Order of 2 September 2002, the trial court denied the Motion to Quash Subpoena Ad Testificandum, but re- purpose of executing acts of ownership or possession, or in any manner disturbs the possession given to the person
scheduled the hearing to 23 October 2002. On 22 October 2002, the day before the scheduled hearing, petitioner adjudged to be entitled thereto;
filed a manifestation manifestation informing the trial court that he was still in Canada and would not be able to (c) Any abuse of or any unlawful interference with the processes or proceedings of a court not constituting direct
attend the 23 October 2002 hearing; however, he would be in Manila on the first week of December 2002. He moved contempt under section 1 of this Rule;
that the hearing be re-scheduled on 9 December 2002. The manifestation, however, did not contain a notice of (d) Any improper conduct tending, directly or indirectly, to impede, obstruct, or degrade the administration of
hearing. justice;
(e) Assuming to be an attorney or an officer of a court, and acting as such without authority;
On 23 October 2002, petitioner did not appear at the scheduled hearing, prompting the trial court to issue an order (f) Failure to obey a subpoena duly served;
citing him in contempt of court. (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.

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In relation to the foregoing, Section 38 of Rule 39 of the Rules of Court also provides that "a party or other person and Motion to Re-schedule Proceedings. The explanation is either a delayed afterthought or an unguarded confession
may be compelled, by an order or subpoena, to attend before the court or commissioner to testify as provided in the of a deliberate plan to delay or even avoid his examination as a judgment obligor.
two preceding sections, and upon failure to obey such order or subpoena or to be sworn, or to answer as a witness or
to subscribe his deposition, may be punished for contempt as in other cases." This provision relates specifically to Neither can petitioner rely on the alleged irregularity in the trial court’s grant of the motion to examine him as
Section 3(b) of Rule 71 of the Rules of Court. judgment obligor before he was able to file a reply or comment. Section 36 of, Rule 39 of the Rules of Court allows,
as a matter of right, the plaintiff who is a judgment obligee to examine the defendant as judgment obligor, at any
Indirect contempt may either be initiated (1) motu proprio by the court by issuing an order or any other formal time after the return of the writ of execution is made. Section 36 reads as follows:
charge requiring the respondent to show cause why he should not be punished for contempt or (2) by the filing of a Sec. 36. Examination of judgment obligor when judgment unsatisfied. — When the return of a writ of execution
verified petition, complying with the requirements for filing initiatory pleadings. 10 In the present case, the trial court issued against property of a judgment obligor, or any one of several obligors in the same judgment, shows that the
initiated the proceedings for indirect contempt by issuing two orders11 directing the petitioner to show cause why he judgment remains unsatisfied, in whole or in part, the judgment obligee, at any time after such return is
should not be punished for indirect contempt. made, shall be entitled to an order from the court which rendered the said judgment, requiring such judgment
obligor to appear and be examined concerning his property and income before such court or before a commissioner
Contempt, whether direct or indirect, may be civil or criminal depending on the nature and effect of the appointed by it, at a specified time and place; and proceedings may thereupon be had for the application of the
contemptuous act. Criminal contempt is "conduct directed against the authority and dignity of the court or a judge property and income of the judgment obligor towards the satisfaction of the judgment. But no judgment obligor
acting judicially; it is an act obstructing the administration of justice which tends to bring the court into disrepute or shall be so required to appear before a court or commissioner outside the province or city in which such obligor
disrespect."12 On the other hand, civil contempt is the failure to do something ordered to be done by a court or a resides or is found. (Emphasis supplied)
judge for the benefit of the opposing party therein and is therefore, an offense against the party in whose behalf the
violated order was made.13 If the purpose is to punish, then it is criminal in nature; but if to compensate, then it is Thus, the trial court committed no abuse of discretion in scheduling the examination of petitioner on 22 March 2002.
civil.14 On the contrary, it acted with utmost judiciousness to avoid a miscarriage of justice because petitioner was reported
to be about to leave for Canada, a fact which petitioner did not refute in his Manifestation of 19 March 2002.
In the present case, the contemptuous act was the petitioner’s refusal to attend a hearing for his examination as
judgment obligor, upon motion by the respondent Teresa. It must be pointed out that the purpose of Section 36 of It is noteworthy that while petitioner insisted that he still had until 14 April 2002 to file a reply or comment on the
Rule 39 is to provide the judgment obligee a remedy in case where the judgment obligor continues to fail to comply motion for examination, he also manifested through counsel on 5 April 2002 that he already left for Canada on 26
with its obligation under the judgment. Petitioner’s refusal to be examined, without justifiable reason, constituted March 2002 and will not be back until the last week of July or the first week of August 2002. It is obvious then that
indirect contempt which is civil in nature. petitioner wanted to gain time to avoid being examined.

Petitioner’s deliberate willfulness and even malice in disobeying the orders of the trial court are clearly shown in the With respect to the 10 April 2002 hearing, it is established that petitioner was already in Canada at the time of the
pleadings he himself had filed before the trial court. scheduled hearing. Nonetheless, it must be stressed that the re-scheduling of the hearing to 10 April 2002 was
brought about by his unjustifiable failure to attend the 22 March 2002 hearing.
In his Manifestation of 19 March 2002 petitioner insisted on his right to file a reply or comment on the Motion to
Examine Defendant as Judgment Obligor until 14 April 2002 solely on the basis of the purported agreement at the Subsequently, despite petitioner’s 19 March 2002 and 5 April 2002 manifestations that he would return to the
conference on 6 March 2002. Petitioner merely brushed aside the Order of the trial court requiring him to appear on Philippines sometime during the last week of July or first week of August 2002, petitioner did not attend the 23
22 March 2002 for the hearing by not appearing in court. Petitioner cannot simply assume that his manifestation October 2002 hearing. Again, instead of filing a motion to reset the hearing, petitioner filed a manifestation the day
would suffice for the trial court to re-schedule the 22 March 2002 hearing. That portion of the manifestation filed by before the scheduled hearing, informing the court that he will be unable to attend the hearing and suggesting the
petitioner on 19 March 2002, which reads: hearing to be reset to 9 December 2002. Such manifestation to re-schedule the 23 October 2002 hearing was, for all
3. In the meantime, we have no other option but to cancel the setting on March 22, 2002 until Respondent shall intents and purposes, a motion to postpone the hearing , but the pleading did not contain a notice of hearing.
have submitted his Reply/Comment and the issue is finally laid to rest by the issuance of a final Order for that
purpose. It is of no moment that petitioner was eventually examined as judgment obligor on 17 December 2002, nine (9)
months after the original setting. His subsequent appearance at the hearing did not wipe out his contemptuous
demonstrates beyond doubt arrogance, haughtiness and disrespect. While petitioner apparently disagrees with the conduct.
19 March 2002 Order of by the trial court, he did not file a motion for its reconsideration. Neither did he file a motion
to reset the scheduled hearing on 22 March 2002. We have ruled that a motion for continuance or postponement is We shall now take up the penalties imposed by the trial court.
not a matter of right but is addressed to the sound discretion of the court.15 Petitioner sought to deprive the trial
court of the discretion; he took it upon himself to cancel or to order the court to cancel the 22 March 2002 scheduled
hearing. Under Section 7 of Rule 71 of the Rules of Court, a person found guilty of contempt of court against a Regional Trial
Court may be punished with a fine not exceeding thirty thousand pesos or imprisonment not exceeding six (6)
months, or both. The penalties ofor imprisonment for three months and a fine of twenty thousand pesos are within
Petitioner makes a belated claim in the present petition that his failure to attend the 22 March 2002 hearing was due the allowable penalties the trial court itit may impose. However, the penalties of imprisonment and fine may be
to the fact that he was already on his way to Manila on 22 March 2002 in preparation for his 26 March 2002 trip to imposed one at a time, or together.
Canada. However, such explanation was not stated in the 19 March 2002 Manifestation and 5 April 2002 Compliance

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In the present case, the nature of the contemptuous acts committed are civil in nature. Section 7 of Rule 71 of the
Rules of Court provides for indefinite incarceration in civil contempt proceedings to compel a party to comply with the
order of the court. This may be resorted to where the attendant circumstances are such that the non-compliance with
the court order is an utter disregard of the authority of the court which has then no other recourse but to use its
coercive power.16 It has been held that "when a person or party is legally and validly required by a court to appear
before it for a certain purpose, when that requirement is disobeyed, the only remedy left for the court is to use force
to bring such person or party before it."17

The reason for indefinite incarceration in civil contempt proceedings, in proper cases, is that it is remedial,
preservative, or coercive in nature. The punishment is imposed for the benefit of a complainant or a party to a suit
who has been injured. Its object is to compel performance of the orders or decrees of the court, which the contemnor
refuses to obey although able to do so.18 In effect, it is within the power of the person adjudged guilty of contempt to
set himself free.

In the present case, however, the act which the trial court ordered the petitioner to do has already been performed,
albeit belatedly and not without delay for an unreasonable length of time. As such, the penalty of imprisonment may
no longer be imposed despite the fact that its non-implementation was due to petitioner’s absence in the Philippines.

We are not unmindful of the nature of the judgment from which the present controversy arose. Six years have
elapsed from the time the compromise agreement for the support of the children of petitioner and respondent was
executed. We take judicial notice of the amount of expenses which a travel outside the country, particularly to
Canada, entails, much more so when the person traveling to Canada is trying to establish himself in the said country
as an immigrant. Petitioner’s claim for insolvency is negated by his frequent travels to Canada. We thus exhort the
parties, specifically the petitioner, to resort to all reasonable means to fully satisfy the judgment for support based on
the compromise agreement, for the paramount interests of their minor children.

WHEREFORE, the petition is hereby PARTIALLY GRANTED. The 8 November 2002 Order of the Regional Trial
Court, Branch 41, Bacolod City in with Civil Case No. 94-8467 is modified. As modified, the penalty of for
imprisonment is deleted therefrom, while the penalty of fine of ₱20,000 is affirmed.

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