1.

Rules 34 and 35 (Judgment on the Pleadings/Summary Judgment)

Meneses vs. Sec. of Agrarian Reform, G.R. No. 156304, October 23, 2006
G.R. No. 156304 October 23, 2006
NACLETO R. MENESES, et al vs SECRETARY OF AGRARIAN REFORM, LAND BANK OF
THE PHILIPPINES, RODRIGO VELAYO et al

FACTS
Petitioners were co-owners pro-indiviso of an irrigated rice land in San Miguel,
Bulacan, measuring 60.85 hectares and registered in the name of their grandparents
In October 1972, the property was distributed to farmer-beneficiaries by virtue
of P.D. No. 27
In July 1993, petitioners filed with the RTC of Bulacan, a complaint for
determination and payment of just compensation
Petitioners alleged that no payment or rentals has been made, and titles have
already been issued to the farmer-beneficiaries
Petitioners alleged that the fair market value of the property is Php 6 mio.
For their part, the farmer-beneficiaries alleged
that the land valuation based on three normal crop years before
P.D. No. 27 is in accordance with the existing guidelines and procedure on
Operation Land Transfer
they have no unpaid rentals
and jurisdiction over the case lies with the Department of
Agrarian Reform Adjudication Board (DARAB).
Land Bank of the Philippines-Land Valuation and Landowners Compensation
(LBP-LVLC), averred that the computation was obtained through the valuation
processes of the DAR on lands covered by P.D. No. 27 and E.O. 228. It also alleged
that jurisdiction over the case lies with the DARAB.
The DAR Secretary alleged that the valuation of the property was pursuant to
the Operation Land Transfer under P.D. No. 27 and the reckoning date should be at
the time of the taking of the property, i.e., October 21, 1972.
the DAR claimed that the filing of the case is premature since there is no
valuation yet made by the DAR based on E.O. No. 228, and petitioners must
cooperate with the DAR by submitting all the necessary papers for proper valuation
and expeditious payment of the land. The DAR also claimed that it must first
determine the valuation before resort to the court can be made.
RTC dismissed the complaint for lack of cause of action.
the determination of just compensation must first be filed with
the DAR and not the Special Agrarian Court
Petitioners filed a motion for reconsideration, which was partially granted by
the RTC, setting aside its order of dismissal, ordering the suspension of the
proceedings and archiving the case until primary determination has been made on
the issue of just compensation.
In October 1994, petitioners filed a complaint for determination and payment
of just compensation with the DARAB.
The DARAB dismissed the complaint on the ground that it has no jurisdiction
to hear and decide valuation cases covered by P.D. No. 27, as the same is within the
exclusive administrative powers of the Office of the Secretary.
Because of the foregoing dismissal, petitioners filed with the RTC a motion to
re-open and calendar case for hearing, which was granted by the RTC.
During the hearing, the parties agreed as to the issue to be resolved whether
or not the plaintiffs [petitioners] are entitled to just compensation as provided for in

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 Republic Act No. 6657 (R.A. No. 6657) and the Constitution of 1987 and not P.D. No.
27
The parties were then given a period within which to file their respective
motions for judgment on the pleadings and comment/opposition thereto, after which
the case shall be deemed submitted for resolution.
In February 1998, the RTC rendered its Decision dismissing the complaint.
It was the RTCs ruling that since the subject property was taken
from petitioners on October 21, 1972 under the DARs Operation Land Transfer
pursuant to P.D. No. 27, then just compensation must be based on the value of
the property at the time of taking.
petitioners filed an appeal with the CA where petitioners prayed for a remand
of the case to the RTC for further proceedings and/or reception of evidence on the
just and fair market value of the property.
the CA rendered its Decision dismissing the appeal.
Petitioners filed a motion for reconsideration, but the same was denied on the
grounds that it was filed 44 days late and the CA found no cogent reason to reverse
or modify its Decision.
Hence, this petition for review on certiorari based on the following reasons:

ISSUES
THAT THE CA HAS DEPARTED FROM THE ACCEPTED AND USUAL COURSE OF
JUDICIAL PROCEEDINGS OR HAS SANCTIONED SUCH DEPARTURE BY THE LOWER
COURT.

HELD
The Courts finds merit in the petition.
It is true that petitioners failure to file their motion for reconsideration within
the reglementary period rendered the CA Decision final and executory. For all intents
and purposes, said Decision should now be immutable and unalterable;
however, the Court relaxes this rule in order to serve substantial justice
considering
matters of life, liberty, honor or property,
the existence of special or compelling circumstances,
the merits of the case,
a cause not entirely attributable to the fault or negligence of the
party favored by the suspension of the rules,
a lack of any showing that the review sought is merely frivolous
and dilatory, and
the other party will not be unjustly prejudiced thereby.
The explanation of petitioners counsel for the delayed filing of the motion for
reconsideration was that their law firm secretary failed to inform the court of their
change of address. This, of course, is not a valid excuse.
But where such mistake or neglect would result in serious injustice to the
client, a departure from this rule is warranted.
To cling to the general rule is to condone rather than rectify a serious injustice
to petitioners whose only fault was to repose his faith and entrust his innocence to
his lawyer.
Furthermore, we must bear in mind that procedural rules are intended to
ensure the proper administration of law and justice. The rules of procedure ought not
to be applied in a very rigid, technical sense, for they are adopted to help secure, not
override, substantial justice.

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 petitioners will be left without any recourse as regards the resolution of the
issue of just compensation since both the RTC and the DARAB already dismissed the
separate complaints for just compensation filed before them.
Rule 34, Section 1 of the Rules of Court, provides that a judgment on the
pleadings is proper when an answer fails to render an issue or otherwise admits the
material allegations of the adverse partys pleading. The essential question is
whether there are issues generated by the pleadings. A judgment on the pleadings
may be sought only by a claimant, who is the party seeking to recover upon a claim,
counterclaim or cross-claim; or to obtain a declaratory relief. (doctrine here)
In this case, the separate Answers filed by the respondents definitely tendered
issues, as it made specific denials of the material allegations in the complaint and
asserted affirmative defenses, which would bar recovery by petitioners. Moreover, it
was erroneous for the RTC to require the filing of a motion for judgment on the
pleadings and for the LBP and the DAR Secretary to file the same since in the first
place, the latter are neither plaintiffs in the case nor counter-claimants or cross-
claimants.
What the RTC obviously meant to be filed was a motion for summary
judgment, a procedural device designed for the prompt disposition of actions, which
may be rendered if the pleadings, supporting affidavits, depositions and admissions
on file show that, after a summary hearing, there is no genuine issue regarding any
material fact, except as to the amount of damages, and the moving party is entitled
to a judgment as a matter of law, and which may be applied for by either a claimant
or a defending party.
the Court sustains petitioners contention that the CA erred in ruling that the
RTC correctly dismissed their complaint. Even assuming that the RTC was correct in
holding that P.D. No. 27 applies, still it should not have simply dismissed the
complaint after resolving the issue of which law should apply. Instead, it should have
proceeded to determine the just compensation due to petitioners.

Diman vs. Alumbres, 299 SCRA 459 (1998)

CRISTINA DIMAN, CLARISSA DIMAN, GEORGE DIMAN, FELIPE DIMAN and FLORINA DIMAN, vs. HON.
FLORENTINO M. ALUMBRES, Presiding Judge, Regional Trial Court, Las Pias, Branch 255; Heirs of VERONICA
V. MORENO LACALLE, represented by JOSE MORENO LACALLE.

FACTS:

The case began in the RTC Las Pias, where a complaint for "Quieting of Title and Damages" was filed by the Heirs
of Veronica V. Moreno Lacalle (represented by Jose Moreno Lacalle) against Cristina Diman, ClarissaDiman, George
Diman. Felipe Diman and Florina Diman.

Lacalle heirs: In their complaint, claimed that:

a) their mother, the late Veronica V. Moreno Lacalle (who died in 1992), was the owner of a "parcel of land situated at
Brgy. Pulang Lupa Uno, Las Pias, . . . covered by Transfer Certificate of the Registry of Deeds of the Province of
Rizal;"

b) Veronica Lacalle had acquired the land in 1959 by virtue of a deed of absolute sale, and retained as caretakers the
persons she found in occupancy of the lot at the time of the sale, namely: Julian Nario and his wife, Adelaida Legaspi,
"with arrangement to share the agricultural fruits" until the former would have need of the property;

c) the caretakers of the lot were served with a notice for them to vacate the land (dated November 22, 1994) and an
alias writ of demolition (dated June 7, 1994) issued by the Metropolitan Trial Court in Civil Case No. 2619 a case
for "ejectment with damages" filed by the Dimans against the Narios, judgment in which, commanding the Nario's
ouster, had supposedly been affirmed by the Makati Regional Trial Court (Branch No. 137);

d) neither the deceased Veronica nor any of her heirs had been made parties to said ejectment action;

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e) the complaint for ejectment contains false assertions. and had caused them injury for which the Dimans should be
made to pay damages. Cdpr

Dimans: In their answer with counterclaim dated February 2, 1995:

a) they are the registered and absolute owners of the land registered in their names (Pasay City), and have no
knowledge of the land claimed by the Lacalle Heirs;

b) they are entitled to eject from their land the Nario Spouses who were falsely claiming to be their lessees;

c) if the Heirs' theory is that the land in their title, is the same as that covered by the Dimans' titles, then said title is
spurious because:

(1) no less than three official agencies (i) the Office of the Registrar of Deeds for Rizal and Regional Registrar for
Region IV, (ii) the Register of Deeds of Pasay City, and (iii) the Pangasiwaan Pangtalaan ng Lupain (Land
Registration Authority) have certified to the absence of any entry in their records concerning TCT No. 273301
covering land with an area of 22,379 square meters in the name of Veronica Vda. de Moreno Lacalle;

(2) Decree No. N-11601 explicitly cited as basis by TCT No. 273301 refers to land in Mauban, Quezon Province,
according to the records of the Land Registration Authority; and GLRO Record No. 14978 also expressly mentioned
as basis for TCT No. 273301, refers to a registration case heard in Pangasinan;

and

d) they are entitled to damages on their counterclaim. cdrep

Dimans: served on the Heirs on February 2, 1995, a REQUEST FOR ADMISSION (dated February 2, 199~) of the
truth of the following specified matters of fact, to wit :

a) the Heirs' TCT 273301 (Rizal) is not recorded in the Registry of Rizal, or of Pasay City, or of Paraaque, or of
Las Pias;

b) the Dimans' transfer certificates of title are all duly registered in their names in Pasay City, as alleged in their
answer;

c) in the Index Records of Registered Property Owners under Act No. 496 in the Office of the Land Registration
Authority, there is no record of any property situated in Las Pias in the name of Veronica Lacalle, more
particularly described in TCT 273301;

* 4) the Heirs cannot produce a certified true copy of TCT 273301:

5) neither Veronica Lacalle nor any of her heirs ever declared the property under TCT 273301 for taxation
purposes since its alleged acquisition on February 24, 1959 or since the issuance of said title on August 7,
1959;

6) not a single centavo has been paid by the Heirs as real estate taxes; and

7) no steps have been taken by the Heirs to ascertain the genuineness and authenticity of the conflicting
titles. prLL

The REQUEST FOR ADMISSION was received by Jose Lacalle himself through registered mail and copy thereof. by
the latter's lawyer Atty. Ching but no response whatever was made to the request by Lacalle, his lawyer. or anyone
else, despite the lapse of the period therefor fixed by Section 2 of Rule 26 (not less than ten days after service).

Dimans: filed with the Court, a "MANIFESTATION WITH MOTION TO REQUIRE PLAINTIFFS TO ANSWER
REQUEST FOR ADMISSION," giving the Heirs ten (10) more days to file their answer to the request for admission, a
copy of which was personally delivered to the latter's lawyer; but again, no response whatever was made.

The Dimans then submitted a "MOTION FOR SUMMARY JUDGMENT" stating Heirs' failure to file any Pre-Trial Brief,
and failure to appear at scheduled hearings resulting in the dismissal of their complaint, which was however later
reinstated. They argued that because the Heirs had failed to respond to their REQUEST FOR ADMISSION, each of
the matters of which an admission was requested, was deemed admitted pursuant to Section 2, Rule 26. On this
basis, and on the basis of the joint affidavit of Clarissa Diman de los Reyes and Florina Diman Tan attached to the
motion and substantiating the facts recited in the request for admission the Dimans asserted that no genuine issue
existed and prayed that "a summary judgment be entered dismissing the case for lack of merit."

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The Heirs' counsel: filed a two-page opposition dated May 15. 1995 in which, betraying an unfortunate unfamiliarity
with the concept of summary judgments, he asserted inter alia that:

"In order for Dimans to successfully pray for judgment on the pleadings, they have to clearly allege in their
permissive counterclaim their cause of action and if the answer of the plaintiffs (Heirs) to such kind of
counterclaim admit (sic) it or the answer to the counterclaim is a sham, that is the time for the defendants to
move for a judgment summarily.. . . (D)efendants have no cause of action for praying for summary judgment. It
is the plaintiffs who will pray for that and not the defendants."

Subsequently, the Dimans submitted a reply; the Heirs, a rejoinder; and the Dimans, a pleading entitled "Exceptions
and Comment to Plaintiffs' Rejoinder"

TC: denied the Dimans' motion for summary judgment ruling that Court "perusal of the Complaint and the Answer will
clearly show that material issue is raised in that both plaintiffs and defendants claimed ownership over the land in
dispute, presenting their respective titles thereto and accused each other of possessing false title to the land." It
stressed, citing jurisprudence. that a summary judgment "is not proper where the defendant presented defenses
tendering factual issues which call for the presentation of evidence." cdrep

The case proceeded to trial in due course. At its start. the Heirs' counsel, Atty. Michael Moralde, responding to
questions of the Court, admitted that his clients did not have the original copy of the title which was the basis for their
cause of action, but asserted that they were "still searching" for it since "(i)n every municipality there are several
Registry of Deeds." He theorized that the word "title" . . . is a relative term . . .(and) does not only refer to a document
but refers to ownership." 17

Only Jose Moreno Lacalle gave evidence for the plaintiff Heirs. Like Atty. Moralde, he admitted that he had no copy
"of the document which says . . . . (his) mother is the registered owner;" that the deed of sale was not the only basis
for his and his co-heirs' claim to the land, but also "a xerox copy of the " title . . . except that . . . (he) cannot find the
original;" that "maybe" the original was in possession of the person who was his mother's agent in all her
transactions, a certain Mr. Lopez, whom he could no longer locate; that he had tried to verify the existence of the title
"from the Register of Deeds of Pasig and Pasay" without success; that he had not, however, gone to the Register of
Deeds of Paraaque or Las Pias.

The Heirs' documentary evidence consisted of (1) Veronica Lacalle's death certificate and special power of attorney
authorizing Jose Lacalle to act for his brothers and sisters; and (3) the deed of absolute sale purportedly executed by
Eusebio Mojica, Clara Mojica, Maria Mojica, Antonia Mojica. Amanda Mojica and Teodora Aranda which deeded over
to Veronica Lacalle the "land 'known as Lot 1 PSU-151453,"' but which made no reference to any Torrens title over it.

Shortly after the Heirs rested their case, the Dimans filed a "Motion for Judgment on Demurrer to Evidence," dated
June 25, 1996. They summarized the Heirs' evidence focusing attention on the Heirs' failure to present "even an
unauthenticated photocopy of the title," and the absence of any proof that any proceedings for registration of the land
under the Torrens Act had been instituted and emphasized anew said Heirs' implied admissions resulting from
their failure to answer their (the Dimans') request therefor as a mode of discovery. On these premises, the Dimans
contended that a judgment on demurrer should be rendered, there being no genuine issue between the parties
notwithstanding the ostensible conflict of averments in their basic pleadings.

The Heirs presented a three-page opposition, dated July 7 1996. 20 In it their counsel set out the startling contention
that "(d)emurrer to evidence is violative to due process as the judgment be rendered without giving the plaintiff the
opportunity to cross-examine the defendant," and petulantly inquired, "How could the truth come out without cross-
examination of the defendants by the plaintiffs?" particularly, as regards "whether their (the Dimans') title is not fake."
Said counsel also posited the amazing notion that "Demurrer to evidence may be correct only in criminal cases as it
is the right of the accused to remain silent, and that includes his right to file demurrer for fear of cross-examination.
But not in Civil Cases." Once more counsel regrettably exposed his ignorance of quite elementary legal principles.
cdll

TC: denied their MTD. Respecting the Heirs' omission to present in evidence any copy (even a photocopy) of TCT
No. 273301, the Court remarked that "Not being able to prove the genuineness and authenticity of TCT No. 273301, it
being only a mere xerox copy . . . (the Heirs) did not formally offer the same in evidence." However, the Court said,
the deed of sale of the land in Veronica Lacalle's favor that was submitted instead the "genuineness and
authenticity . . . (of which had) been fully established" by the certificate of the Clerk of Court of the Manila RTC was
adequate for the purpose. According to the Court, "(e)xecution of a deed of conveyance in a certain prescribe form
gave effect to the transfer of a title to the land conveyed . . . (and) without being controverted by any convincing
evidence to the contrary can be a sufficient basis in granting the plaintiffs' relief for quieting of their title." The Order
passed sub silentio on the quaint; contentions in the Heirs' opposition.

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TDimans: moved for reconsideration (1) alleging that although the photocopy of TCT 2773301 annexed to the Heirs'
complaint states that the "certificate is a transfer from T.C.T. No. 259150" (and this, presumably, would be the
vendors' [the Mojicas'] title), no effort whatever was made to submit proof thereof and (2) reiterating the proposition
that the Heirs were bound by their implied admissions under Rule 26.

The Dimans also submitted a "SUPPLEMENT TO MOTION FOR RECONSIDERATION" in which they invited
attention to the identity of the technical description of the land contained in the deed of sale to Veronica Lacalle and
that set out in TCT No. 273301. It must therefore have been Veronica Lacalle, they reasoned, who had instituted the
registration proceedings leading to the supposed issuance of said TCT No. 273301. Yet the Heirs failed to present
evidence of the record of any such registration proceedings, just as they failed to present evidence of any authentic
copy of the title itself.

The Heirs filed a one-page "Vehement Opposition . . . " dated February 15, 1997. 24 Once again they reiterated the
astounding argument that the Dimans' "insistence . . . (on the demurrer to evidence) is tantamount to suppression of
their evidence as they are afraid of cross-examination"!

TC: rebuffed the Dimans. In its Order of February 28, 1997, the Court ruled that the issues raised in the motion for
reconsideration and its supplement had already been passed upon in the Order of December 2, 1996. It then set the
case "for the reception of defendants' evidence on April 22, 1997 . . .

What the Dimans did was to commence a special civil action of certiorari, mandamus and prohibition in the Court of
Appeals praying (a) that it set aside the Orders of June 14, 1995 (denying summary judgment), of December 2
(denying demurrer to evidence), and of February 28. 1997 (denying reconsideration); (b) that the Trial Judge be
commanded to dismiss the case before it; and (c) that said judge be prohibited from conducting further proceedings
in the case. prLL

But once again their efforts met with failure. The Appellate Tribunal (Seventh Division) promulgated judgment on
September 9, 1997 decreeing that their petition be "DENIED due course and DISMISSED." The Court of Appeals
held that insofar as concerned the Order of June 14, 1995, the petition for its invalidation had not been filed within a
reasonable time; and that as regards the Order of December 2, 1996, the remedy of certiorari was improper because:
(1) said order was merely interlocutory, (2) any error therein constituted only an error of judgment correctible by
appeal. and (3) there was no capriciousness or whimsicality attendant upon the order.

CA: The Dimans' motion for reconsideration was later denied.

The Dimans thereupon filed with this Court a petition for review on certiorari of the Appellate Tribunal's Decision of
September 9, 1997. But seemingly consistent with the pattern of judicial misfortune which they had theretofore been
traversing, their petition for review was dismissed. by Resolution dated January 14, 1998. Their appeal was however
subsequently reinstated, as earlier recounted.

ISSUE:

Now, what first strikes the Court about the case at bar is the regrettable absence of familiarity, therein laid bare, with
the rules of discovery and with the underlying philosophy and principles of the cognate remedy of summary judgment.
That resulted in the undue protraction of the present action despite ample demonstration of the absence of any
genuine issue that is to say. that the issues ostensibly arising from the pleadings were sham or fictitious.

HELD:

A Trial Court has no discretion to determine what the consequences of a party's refusal to allow or make discovery
should be; it is the law which makes that determination; and it is grave abuse of discretion for the Court to refuse to
recognize and observe the effects of that refusal as mandated by law. Particularly as regards requests for admission
under Rule 26 of the Rules of Court, the law ordains that when a party is served with a written request that he admit:

(1) the genuineness of any material and relevant document described in and exhibited with the request, or

(2) the truth of any material and relevant matter of fact set forth in the request, said party is bound within the period
designated in the request, to file and serve on the party requesting the admission a sworn statement either

(1) denying specifically the matters of which an admission is requested or

(2) setting forth in detail the reasons why he cannot truthfully either admit or deny those matters. If the party served
does not respond with such a sworn statement, each of the matters of which an admission is requested shall be
deemed admitted.

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In this case, the Dimans' request for admission was duly served by registered mail on Jose Lacalle on February 6,
1995, and a copy thereof on his lawyer on February 4, 1995. Neither made any response whatever within the
reglementary period. Nor did either of them do so even after receiving copy of the Dimans' "MANIFESTATION WITH
MOTION TO REQUIRE PLAINTIFFS TO ANSWER REQUEST FOR ADMISSION," dated March 28, 1995. On
account thereof, in legal contemplation, the Heirs impliedly admitted all the facts listed in the request for admission.
These plain and simple legal propositions were disregarded by His Honor. cdrep

It is also the law which determines when a summary judgment is proper. It declares that although the pleadings on
their face appear to raise issues of fact e.g., there are denials of, or a conflict in, factual allegations if t is shown
by admissions, depositions or affidavits, that those issues are sham, fictitious, or not genuine, or, in the language of
the Rules, that "except as to the amount of damages, there is no genuine issue as to any material fact and that the
moving party is entitled to a judgment as a matter of law. the Court shall render a summary judgment for the plaintiff
or the defendant,as the case may be.

Parenthetically, the existence or appearance of ostensible issues in the pleadings, on the one hand, and their sham
or fictitious character. on the other, are what distinguish a proper case for a summary judgment from one for a
judgment on the pleadings under Rule 19 of the 1964 Rules In the latter case, there is no ostensible issue at all, but
the absence of any because of the failure of the defending party's answer to raise an issue. Rule 19 expresses the
principle as follows:

"Where an answer fails to tender an issue, or otherwise admits the material allegations of the adverse
party's pleading, the court may, on motion of that party, direct judgment on such pleading . . .

On the other hand, in the case of a summary judgment. issues apparently exist i.e., facts are asserted in the
complaint regarding which there is as yet no admission, disavowal or qualification; or specific denials or affirmative
defenses are in truth set out in the answer but the issues thus arising from the pleadings are sham, fictitious, not
genuine, as shown by admissions, depositions or admissions. In other words, as a noted authority remarks, a
judgment on the pleadings is a judgment on the facts as pleaded, while a summary judgment is a judgment on the
facts as summarily proven by affidavits, depositions or admissions. Another distinction is that while the remedy of a
judgment on the pleadings may be sought only by a claimant (one seeking to recover upon a claim, counterclaim, or
cross-claim or to obtain a declaratory relief, supra), a summary judgment may be applied for by either a claimant or a
defending party.

These basic distinctions escaped His Honor. He denied the Dimans' motion for summary judgment in his Order of
June 14, 1995, opining that a "perusal of the Complaint and the Answer will clearly show that material issue is raised
in that both plaintiffs and defendants claimed ownership over the land in dispute, presenting their respective titles
thereto and accused each other of possessing false title to the land." He added, citing cases. that a summary
judgment "is not proper where the defendant presented defenses tendering factual issues which call for the
presentation of evidence." Such a ratiocination is grossly erroneous. Clearly, the grounds relied on by the Judge are
proper for the denial of a motion for judgment on the pleadings as to which the essential question, as already
remarked, is: are there issues arising from or generated by the pleadings? but not as regards a motion for
summary judgment as to which the crucial question is: issues having been raised by the pleadings, are those
issues genuine, or sham or fictitious as shown by affidavits, depositions or admissions accompanying the application
therefor?

Errors on principles so clear and fundamental as those herein involved cannot be deemed so egregious as to
constitute grave abuse of discretion being tantamount to whimsical or capricious exercise of judicial prerogative.
LibLex

When the Heirs closed their evidence as party plaintiffs. and the Dimans moved to dismiss on ground of insufficiency
of the Heirs' evidence, the Trial Judge was charged with the duty to assess the evidence to ascertain whether or not
"upon the facts and the law the plaintiff(s) . . . (have) shown no right to relief." It was in the first place incumbent on
His Honor to hold the Heirs bound to their admissions appearing in the record, express and implied. In accordance
with Section 2, Rule 26 of the 1964 Rules of Court, the Heirs were impliedly, but no less indubitably, deemed to have
admitted the facts on which admissions had been duly requested by reason of their failure to reply thereto. Said
Section 2 reads as follows:

"SEC. 2. Implied admission. Each of the matters of which an admission is requested shall be deemed
admitted unless within a period designated in the request, which shall not be less than ten (10) days after
service thereof, or within such further time as the court may allow on motion and notice, the party to whom
the request is directed serves upon the party requesting the admission a sworn statement either denying
specifically the matters on which an admission is requested or setting forth in detail the reasons why he
cannot truthfully either admit or deny those matters.

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 Objections on the ground of irrelevancy or impropriety or the matter requested shall be promptly submitted
to the court for resolution."

In fine, the Heirs had proven nothing whatever to justify a judgment in their favor. They had not presented any copy
whatever of the title they wished to be quieted. They did not adduced any proof worthy of the name to establish their
predecessors' ownership of the land. On the contrary. their own evidence, from whatever aspect viewed, more than
persuasively indicated their lack of title over the land, or the spuriousness of their claim of ownership thereof. The
evidence on record could not be interpreted in any other way, and no other conclusion could be drawn therefrom
except the unmeritoriousness of the complaint. The case at bar is a classic example of the eminent propriety of a
summary judgment, or a judgment on demurrer to evidence.

Considering these circumstances, including the outlandish grounds of opposition advanced by the Heirs against the
Dimans' motions for summary judgment and for demurrer to evidence, no less than the obviously mistaken grounds
cited by the Trial Court for denying said motions, this Court has no hesitation in declaring that it was indeed grave
abuse of discretion on the part of the Trial Court to have refused to render a summary judgment or one on demurrer
to evidence. In no sense may the Trial Court's errors be considered, as the Court of Appeals did in its judgment of
September 9, 1997 as mere errors of judgment correctible by appeal, untarnished by any capriciousness or
whimsicality.

WHEREFORE, CA decision is REVERSED and SET ASIDE: the Orders dated July 14, 1996 and rendered in the
action for "Quieting of Title and Damages" are annulled; and said Civil Case No. 94-3085 is DISMISSED.

DOCTRINE:

MOTION FOR EXTENSION OF TIME; GRANT THEREOF LIES IN THE SOUND DISCRETION OF THE COURT.
The Court admits the late comment, but takes this occasion to reiterate the familiar doctrine that no party has
a right to an extension of time to comply with an obligation within the period set therefor by law; motions for
extension are not granted as a matter of course; their concession lies in the sound discretion of the Court
exercised in accordance with the attendant circumstances; the movant is not justified in assuming that the
extension sought will be granted, or that it will be granted for the length of time suggested by him. It is thus
incumbent on any movant for extension to exercise due diligence to inform himself as soon as possible of
the Court's action on his motion, by timely inquiry of the Clerk of Court. Should he neglect to do so, he runs
the risk of time running out on him, for which he will have nobody but himself to blame.

Other Important details:

ID.; ID.; MODE OF DISCOVERY; ADMISSION BY ADVERSE PARTY; REQUEST FOR ADMISSION; EACH OF THE
MATTERS LISTED THEREIN DEEMED ADMITTED BY PARTY SERVED THEREWITH FOR FAILURE TO
RESPOND WITH A SWORN STATEMENT EITHER DENYING SPECIFICALLY OR SETTING FORTH THE
REASONS WHY EITHER ADMISSION OR DENIAL CANNOT BE MADE. A Trial Court has no discretion to
determine what the consequences of a party's refusal to allow or make discovery should be; it is the law which makes
that determination; and it is grave abuse of discretion for the Court to refuse to recognize and observe the effects of
that refusal as mandated by law. Particularly as regards requests for admission under Rule 26 of the Rules of Court,
the law ordains that when a party is served with a written request that he admit: (1) the genuineness of any material
and relevant document described in and exhibited with the request, or (2) the truth of any material and relevant
matter of fact set forth in the request, said party is bound within the period designated in the request, to file and serve
on the party requesting the admission a sworn statement either (1) denying specifically the matters of which an
admission is requested or (2) setting forth in detail the reasons why he cannot truthfully either admit or deny those
matters. If the party served does not respond with such a sworn statement, each of the matters of which an
admission is requested shall be deemed admitted.

CASE AT BAR The Dimans' request for admission was duly served by registered mail on Jose Lacalle on February
6, 1995, and a copy thereof on his lawyer on February 4, 1995. Neither made any response whatever within the
reglementary period. Nor did either of them do so even after receiving copy of the Dimans' "MANIFESTATION WITH
MOTION TO REQUIRE PLAINTIFFS TO ANSWER REQUEST FOR ADMISSION," dated March 28, 1995. On
account thereof, in legal contemplation, the Heirs impliedly admitted all the facts listed in the request for admission.
These plain and simple legal .propositions were disregarded by His Honor.

FOR FAILURE TO REPLY THERETO, HEIRS IN CASE AT BAR DEEMED TO HAVE IMPLIEDLY ADMITTED THE
FACTS ON WHICH ADMISSION HAS BEEN REQUESTED. When the Heirs closed their evidence as party
plaintiffs, and the Dimans moved to dismiss on ground of insufficiency of the Heirs' evidence, the Trial Judge was
charged with the duty to assess the evidence to ascertain whether or not "upon the facts and the law the plaintiff(s) . .
. (have) shown no right to relief." It was in the first place incumbent on His Honor to hold the Heirs bound to their
admissions appearing in the record, express and implied. In accordance with Section 2, Rule 26 of the 1964 Rules of

8
Court, the Heirs were impliedly, but no less indubitably, deemed to have admitted the facts on which admissions had
been duly requested by reason of their failure to reply thereto.

SUMMARY JUDGMENT; PROPRIETY THEREOF IS DETERMINED BY LAW. It is also the law which determines
when a summary judgment is proper. It declares that although the pleadings on their face appear to raise issues of
fact e.g., there are denials of, or a conflict in, factual allegations if it is shown by admissions, depositions or
affidavits, that those issues are sham, fictitious, or not genuine, or, in the language of the Rules, that "except as to the
amount of damages, there is no genuine issue as to any material fact and that the moving party is entitled to a
judgment as a matter of law," the Court shall render a summary judgment for the plaintiff or the defendant, as the
case may be. aATHIE

DISTINGUISHED FROM JUDGMENT ON THE PLEADINGS. The existence or appearance of ostensible issues in
the pleadings, on the one hand, and their sham or fictitious character, on the other, are what distinguish a proper case
for a summary judgment from one for a judgment on the pleadings under Rule 19 of the 1964 Rules. In the latter
case, there is no ostensible issue at all, but the absence of any because of the failure of the defending party's answer
to raise an issue. On the other hand, in the case of a summary judgment, issues apparently exist i.e., facts are
asserted in the complaint regarding which there is as yet no admission, disavowal or qualification; or specific denials
or affirmative defenses are in truth set out in the answer but the issues thus arising from the pleadings are sham,
fictitious, not genuine, as shown by admissions, depositions or admissions. In other words, as a noted authority
remarks, a judgment on the pleadings is a judgment on the facts as pleaded while a summary judgment is a
judgment on the facts as summarily proven by affidavits, depositions or admissions. Another distinction is that while
the remedy of a judgment on the pleadings may be sought only by a claimant (one seeking to recover upon a claim,
counterclaim, or cross-claim or to obtain a declaratory relief, supra), a summary judgment may be applied for by
either a claimant or a defending party.

GROUNDS RELIED ON BY JUDGE IN CASE AT BAR, NOT PROPER FOR DENIAL THEREOF. These basic
distinctions escaped His Honor. He denied the Dimans' motion for summary judgment in his Order of June 14, 1995,
opining that a "perusal of the Complaint and the Answer will clearly show that material issue is raised in that both
plaintiffs and defendants claimed ownership over the land in dispute, presenting their respective titles thereto and
accused each other of possessing false title to the land." He added, citing cases, that a summary judgment "is not
proper where the defendant presented defenses tendering factual issues which call for the presentation of evidence."
Such a ratiocination is grossly erroneous. Clearly, the grounds relied on by the Judge are proper for the denial of a
motion for judgment on the pleadings as to which the essential question, as already remarked, is: are there issues
arising from or generated by the pleadings? but not as regards a motion for summary judgment as to which the
crucial question is: issues having been raised by the pleadings, are those issues genuine, or sham or fictitious, as
shown by affidavits, depositions or admissions accompanying the application therefor? Errors on principles so clear
and fundamental as those herein involved cannot be deemed so egregious as to constitute grave abuse of discretion,
being tantamount to whimsical or capricious exercise of judicial prerogative.

CIRCUMSTANCES IN CASE AT BAR WARRANT GRANT THEREOF OR A JUDGMENT ON DEMURRER TO

EVIDENCE. The Heirs had proven nothing whatever justify a judgment in their favor. They had not presented any
copy whatever of the title they wished to be quieted. They had not adduced any proof worthy of the name to establish
their predecessor's ownership of the land. On the contrary, their own evidence, from whatever aspect viewed, more
than persuasively, indicated their lack of title over the land, or the spuriousness of their claim of ownership thereof.
The evidence on record could not be interpreted in any other way, and no other conclusion could be drawn therefrom
except the unmeritoriousness of the complaint. The case at bar is a classic example of the eminent propriety of a
summary judgment, or a judgment on demurrer to evidence.

SPECIAL CIVIL ACTION; CERTIORARI; TRIAL COURT'S REFUSAL TO RENDER A SUMMARY JUDGMENT OR
DEMURRER TO EVIDENCE CONSTITUTES GRAVE ABUSE OF DISCRETION IN CASE AT BAR. Considering
these circumstances, including the outlandish grounds of opposition advanced by the Heirs against the Dimans'
motions for summary judgment and for demurrer to evidence, no less than the obviously mistaken grounds cited by
the Trial Court for denying said motions, this Court has no hesitation in declaring that it was indeed grave abuse of
discretion on the part of the Trial Court to have refused to render a summary judgment or one on demurrer to
evidence. In no sense may the Trial Court's errors be considered, as the Court of Appeals did in its judgment of
September 9, 1997, as mere errors of judgment correctible by appeal, untarnished by any capriciousness or
whimsicality.

9
Ontimare vs. Elep, G.R. No. 159224, January 20, 2006

Peitioners : Jose D. Ontimare Jr ; Rene Ontimare ; Jose Ontimare Sr.

Respondents : SPS. Renato ; Rosario Elep

Doctrine :
When a decision denominated as summary judgement is quivalent to a judgement
on the merits, it makes the rule on summary judgement inapplicable.

Facts :
This is a petition for review on certiorari in the decision of CA affirming with modifications
the Summary Judgement of RTC Quezon City.

Ontimare Sr. and respondents are neighbors in Hyacinth Street, Roxas District, Quezon City.
Respondents wanted to build a four door, two storey apartment on their lot and applied for
a building permit with Building Official in QC.

Ontimare St owned the adjoining house and adjacent lot. His terrace extends to the
boundary between his property and respondents. Respondents wrote Ontimare Sr. a letter
seeking his written consent to the construction of a firewall adjacent to his existing firewall.

What happened?

1. Instead of consenting, Ontimare Sr. filed a complaint with Building Official asking that
the request for a building permit be withheld since a firewall would adversely affect the
ventilation and market value of his property.
2. A cease and desist order to stop construction of four door apartment was issued as a
result of the complaint
3. Cease and desist was lifted when respondents wrote a letter to City Engineer and
explained they were constructing a one sided firewall within the property.
4. Complaint of Ontimare was dismissed
5. Ontimare Sr., appealed to City Mayor who ordered an investigation on the matter
6. Ontimare Sr., filed a Notarial Prohibition
7. After hearings conducted, Building official DISMISSED the complaint and ordered
Ontimare to make adjustments in construction of his house
8. Respondents were issued a new building permit
9. While respondents workers were doing the firewall, Ontimares fired a shotgun,
threatening to kill anyone who will enter the property.
10. Respondents said that water seeped in the building and damaged the sanding, the
wood parquest floors and ceilings

10
 11. Respondents filed an action for damages
12. AFTER TRIAL, Ontimares moved for a summary jdugement while respondents
moved for resolution of the case on the merits.
13. RTC : Issued summary judgement.
a. Rendered in favor of plaintiff
14. On appeal, CA Affirmed the assailed summary judgement
15. While the case was on appeal, Ontimare Sr. died. He was survived by his two sons,
petitioners herein. Who now come to us on petition for review on certiorari
ALLEGATIONS:

PETITIONERS RESPONDENTS

Summary Judgement may issue only in
favor of a moving party and only when
there is no genuine issue on any material
fact, EXCEPT for the amount of
damages.
He did not want a de riguer trial. He
waived his right to questions the said
summary judgement when he did not
object to respondens motion that the
case may be resolved on it merits

ISSUE :
Whether or not the court of appeals committed reversible error in maintaining the TC
summary judgment against movant defendant

HELD :
NO. Section 3, Rule 34 of Rules of Court. When the pleadings tender a genuine issue,
summary judgement is not proper ; An issue is genuine if it requires the presentation of
evidence as distinguished from a sham, fictitious, contrive or false claim.

Two requisites must concur for summary judgement to be proper:

1. there must be no genuine issue on any material fact, except for the amount of damages
2. The moving party must be entitled to a judgement as matter of law

When on their face, the pleadings tender a genuine issue, summary judgement is not proper.
An issue is genuine if it requires the presentation of evidence as distinguished from a sham,
fictitious, contrived or false claim

Asian Construction and Development Corp. vs. PCIB, G.R. No. 153827, April 25,
2006

PETITIONER: Asian Construction and Development Corporation

RESPONDENT: Philippine Commercial International Bank

11
PONENTE: Garcia, J.
DOCTRINE:
Summary judgment is appropriate when there are no genuine issues of fact which
call for the presentation of evidence in a full-blown trial. Even if on their face the
pleadings appear to raise issues, when the affidavits, depositions and admissions
show that such issues are not genuine, then summary judgment as prescribed by
the Rules must ensue as a matter of law. The determinative factor, therefore, in a
motion for summary judgment, is the presence or absence of a genuine issue as
to any material fact.
FACTS:
PCIB = filed a complaint for a sum of money with prayer for a writ of preliminary attachment
against petitioner ASIAKONSTRUKT.
1. 1st Cause of Action:
Alleged the latter obtained US credit accommodations from PCIB in the amount of
US4,487,000.00 covered by several promissory notes of which have remained not fully paid
despite becoming due and demandable. Demands were made upon ASIAKONSTRUKT but
failed and refused to pay the outstanding obligations to PCIB.
2. 2nd Cause of Action:
PCIB seek exemplary damages and attorneys fees and costs of the suit on the ground that
ASIAKONSTRUKT is guilty of fraud in contracting the debt, in the performance thereof or
both.
TC = order the issuance of the writ of preliminary attachment against the defendant to
satisfy plaintiffs claim of approximately $4.5 M in the alleged unpaid obligation of
defendant, inclusive of interest and charges.
PCIB = posted the requisite bond and thereafter the writ of preliminary attachment was
issued by the trial court. ASIAKONSTRUKT did not file any motion for the quashal nor
dissolution of the writ.
ASIAKONSTRUKT = filed an answer, making admissions and denials. Admits the material
allegations of its indebtedness to PCIB and execution of various deed of assignment, but
denies, for lack of knowledge that it has not paid despite demands of its obligations and
guilty of fraudulently misappropriated for its own use the contract proceeds/receivables
under the contracts, claiming that it has still remaining receivables from those contracts.
ASIAKONSTRUKT = pleads in the answer the alleged severe financial and currency crisis
which hit the Philippines in 1997, which adversely affected and out it out of business.
Furthermore, the deeds of assignments its executed in favour of PCIB were standard forms
proposed by the bank as pre-condition for the release of the loans and partake of the nature
of contracts of adhesions, leaving the defendant to the alternative of taking it or leaving it.
ASIAKONSTRUKT = counterclaim, prayed for an award of P1M and attorneys fees and
litigation expenses.
PCIB = filed a verified Motion for Summary Judgement, contending that the defences
interposed by defendant are sham and contrived, alleged financial crisis pleaded in the
Answer is NOT A FORTUITOUS EVENT that would excused debtors from their loan obligations
nor be exempted, as here, the sam is attended by bad faith. Also asserts that the deed of
assignments are not contracts of adhesion thus the same are valid.
ASIAKONSTRUKT = interposed an Opposition insisting that its ANSWER RAISED GENUINE
AND SUBSTANTIAL ISSUES OF MATERIAL FACTS WHICH REQUIRE A FULL-BLOWN TRIAL.
Significantly, defendant did not append in its opposition any affidavit in support of the
alleged genuine issues of material facts.

12
**before pending incident (motion for summary judgement) could be resolved by the Trial
Court
PCIB = waived its claim for exemplary damages and agreed to reduce its claim for attorneys
fees and made clear such waiver are subject to the condition that a full and final disposition
of the case is obtained via summary judgement.
TC = rendered a judgement in favour of PCIB and ordered ASIAKONSTRUKT to pay the
outstanding obligation plus interest (in USD or Philippine currency equivalent at the time of
payment) on the ground that the defences made by the defendant are worthless,
unsubstantial, sham and contrived in accordance with Section 4, Rule 35 of the Rules of
Court.
Petitioner (ACDC) = appealed to the CA.
CA = affirmed with modification the Summary Judgement rendered by the Trial Court,
modification of attorneys fees be reduced to P1M.
Petitioner (ACDC) = filed a Motion for Reconsideration of the decision of CA, alleging that
there is a genuine issue as to a material fact which precludes the need of a summary
judgement.
CA = denied ACDCs MR pursuant to Rule 35 of the Rules of Court;
except as to the amount of damages, when there is no genuine issue as to any material
fact and the moving party is entitled to a judgment as a matter of law, summary judgment
may be allowed. Summary or accelerated judgment is a procedural technique aimed at
weeding out sham claims or defenses at an early stage of litigation thereby avoiding the
expense and loss of time involved in a trial.
ISSUE:
WON when there is a genuine issue as to a material fact of which precludes the need of a
summary judgement.
HELD: NO genuine issue is not established
RATIO DECIDENDI:
Summary judgment is appropriate when there are no genuine issues of fact which call for
the presentation of evidence in a full-blown trial. Even if on their face the pleadings appear
to raise issues, when the affidavits, depositions and admissions show that such issues are
not genuine, then summary judgment as prescribed by the Rules must ensue as a matter of
law. The determinative factor, therefore, in a motion for summary judgment, is the presence
or absence of a genuine issue as to any material fact.
A genuine issue is an issue of fact which requires the presentation of evidence as
distinguished from a sham, fictitious, contrived or false claim. When the facts as pleaded
appear uncontested or undisputed, then there is no real or genuine issue or question as to
the facts, and summary judgment is called for. The party who moves for summary judgment
has the burden of demonstrating clearly the absence of any genuine issue of fact, or that
the issue posed in the complaint is patently unsubstantial so as not to constitute a genuine
issue for trial. Trial courts have limited authority to render summary judgments and may do
so only when there is clearly no genuine issue as to any material fact. When the facts as
pleaded by the parties are disputed or contested, proceedings for summary judgment
cannot take the place of trial.

The failure of the [petitioner] to append to its Opposition any Affidavits showing that its
defenses were not contrived or cosmetic to delay judgment created a presumption that the
defenses of the [petitioner] were not offered in good faith and that the same could not be
sustained (Unites States versus Fiedler, et al., Federal Reported, 2nd, 578).

13
If, indeed, the [petitioner] believed it that was prevented from complying with its obligations
to the [respondent], under its contracts, it should have interposed a counterclaims for
rescission of contracts.
The [petitioner] may have experienced financial difficulties because of the 1997 economic
crisis that ensued in Asia. However, the same does not constitute a valid justification for the
[petitioner] to renege on its obligations to the [respondent].The [petitioner] cannot even find
solace in Articles 1266 and 1267 of the New Civil Code
We rule and so hold that the CA did not commit any reversible error in affirming the
summary judgment rendered by the trial court as, at bottom, there existed no genuine issue
as to any material fact. We also sustain the CAs reduction in the award of attorneys fees to
only P1,000,000.00, given the fact that there was no full-blown trial.
Petition is denied for lack of merit. CA decision is affirmed in toto including the modifications
thereof.

Bitanga vs. Pyramid Construction, 565 SCRA 544

||
FACTS:
- Respondent filed with the RTC a Complaint for specific performance and damages with
application for the issuance of a writ of preliminary attachment against the petitioner and
Marilyn.|||
- Respondent alleged that |||it entered into an agreement with Macrogen Realty, of which
petitioner is the President, to construct for the latter the Shoppers Gold Building, located at
Dr. A. Santos Avenue corner Palayag Road, Sucat, Paraaque City.
- Respondent commenced civil, structural, and architectural works on the construction
project by May 1997.
- However, Macrogen Realty failed to settle respondent's progress billings.
- Petitioner, through his representatives and agents, assured respondent that the
outstanding account of Macrogen Realty would be paid, and requested respondent to
continue working on the construction project
- Respondent suspended work on the construction project||| since conditions were not
complied with.
- Respondent instituted an action with Construction Industry Arbitration Commission (CIAC)
a case for arbitration against Macrogen Realty||| seeking payment against the latter
- Respondent and Macrogen Realty entered into a Compromise Agreement, 5 with
petitioner acting as signatory for and in behalf of Macrogen Realty. Under the Compromise
Agreement, Macrogen Realty agreed to pay respondent the total amount of P6,000,000.00 in
six equal monthly installments|||.
- Petitioner guaranteed the obligations of Macrogen Realty under the Compromise
Agreement by executing a Contract of Guaranty 6 in favor of respondent, by virtue of which
he irrevocably and unconditionally guaranteed the full and complete payment of the
principal amount of liability of Macrogen Realty in the sum of P6,000,000.00.
- The Compromise Agreement was approved.
- However, Macrogen Realty failed and refused to pay all the monthly installments agreed
upon in the Compromise Agreement.
- Hence, respondent moved for the issuance of a writ of execution against Macrogen Realty,
which CIAC granted.

14
- The sheriff filed a return stating that he was unable to locate any property of Macrogen
Realty.
- A written demand on petitioner, as guarantor of Macrogen Realty, to pay the
P6,000,000.00, or to point out available properties of the Macrogen Realty within the
Philippines sufficient to cover the obligation guaranteed. It also made verbal demands on
petitioner. Yet, respondent's demands were left unheeded.
- Thus, according to respondent, petitioner's obligation as guarantor was already due and
demandable. As to Marilyn's liability, respondent contended that Macrogen Realty was
owned and controlled by petitioner and Marilyn and/or by corporations owned and controlled
by them. Macrogen Realty is 99% owned by the Asian Appraisal Holdings, Inc. (AAHI), which
in turn is 99% owned by Marilyn.
- Marilyn filed a Motion to Dismiss, asserting that respondent had no cause of action against
her, since she did not co-sign the Contract of Guaranty with her husband; nor was she a
party to the Compromise Agreement between respondent and Macrogen Realty. She had no
part at all in the execution of the said contracts.
- The motion to dismiss was denied
- Petitioner filed his Answer with the RTC against the respondent's Complaint averring
therein that he never made representations to respondent that Macrogen Realty would
faithfully comply with its obligations under the Compromise Agreement. He did not offer to
guarantee the obligations of Macrogen Realty to entice respondent to enter into the
Compromise Agreement but that, on the contrary, it was respondent that required Macrogen
Realty to offer some form of security for its obligations before agreeing to the compromise.
Petitioner further alleged that his wife Marilyn was not aware of the obligations that he
assumed under both the Compromise Agreement and the Contract of Guaranty as he did not
inform her about said contracts, nor did he secure her consent thereto at the time of their
execution
- Prior to the trial proper, respondent filed a Motion for Summary Judgment. Respondent
alleged therein that it was entitled to a summary judgment on account of petitioner's
admission during the pre-trial of the genuineness and due execution of the Contract of
Guaranty. The contention of petitioner and Marilyn that they were entitled to the benefit of
excussion was not a genuine issue. Respondent had already exhausted all legal remedies to
collect from Macrogen Realty, but its efforts proved unsuccessful. Given that the inability of
Macrogen Realty as debtor to pay the amount of its debt was already proven by the return of
the writ of execution to CIAC unsatisfied, the liability of petitioner as guarantor already
arose.|||
- Petitioner and Marilyn countered that there were genuinely disputed facts that would
require trial on the merits. They appended thereto an affidavit executed by petitioner, in
which he declared that his spouse Marilyn could not be held personally liable under the
Contract of Guaranty or the Compromise Agreement, nor should her share in the conjugal
partnership be made answerable for the guaranty petitioner assumed, because his
undertaking of the guaranty did not in any way redound to the benefit of their family. As
guarantor, petitioner was entitled to the benefit of excussion, and he did not waive his right
thereto. He never received the respondent's demand letter dated 3 January 2001, as Ms.
Dette Ramos, the person who received it, was not an employee of Macrogen Realty|||
RTC:
Granted the summary judgment. Petitioner and Marilyn filed a Motion for Reconsideration |||,
however, it was denied
CA:
Petitioner and Marilyn filed an appeal with the Court of Appeals||| CA modified the Decision
of the RTC to the effect that defendant-appellant Marilyn Bitanga is adjudged not liable,

15
whether solidarily or otherwise, with her husband the defendant-appellant Benjamin
Bitanga, under the compromise agreement or the contract of guaranty. |||
ISSUE:
Whether or not the Court of Appeals gravely erred in affirming the validity of the partial
summary judgement by the RTC despite the clear existence of disputed genuine and
material facts of the case that should have required a trial on the merits.
HELD:
The Summary judgment was correct
For a summary judgment to be proper, the movant must establish two requisites: (a) there
must be no genuine issue as to any material fact, except for the amount of damages; and
(b) the party presenting the motion for summary judgment must be entitled to a judgment
as a matter of law. Where, on the basis of the pleadings of a moving party, including
documents appended thereto, no genuine issue as to a material fact exists, the burden to
produce a genuine issue shifts to the opposing party. If the opposing party fails, the moving
party is entitled to a summary judgment. 27
In a summary judgment, the crucial question is: are the issues raised by the opposing party
not genuine so as to justify a summary judgment? 28
First off, we rule that the issue regarding the propriety of the service of a copy of the
demand letter on the petitioner in his office is a sham issue. It is not a bar to the issuance of
a summary judgment in respondent's favor.
A genuine issue is an issue of fact which requires the presentation of evidence as
distinguished from an issue which is a sham, fictitious, contrived or false claim. To forestall
summary judgment, it is essential for the non-moving party to confirm the existence of
genuine issues, as to which he has substantial, plausible and fairly arguable defense, i.e., 29
issues of fact calling for the presentation of evidence upon which reasonable findings of fact
could return a verdict for the non-moving party, although a mere scintilla of evidence in
support of the party opposing summary judgment will be insufficient to preclude entry
thereof. aIcDCA
Significantly, petitioner does not deny the receipt of the demand letter from the respondent.
He merely raises a howl on the impropriety of service thereof, stating that "the address to
which the said letter was sent was not his residence but the office of Macrogen Realty, thus
it cannot be considered as the correct manner of conveying a letter of demand upon him in
his personal capacity." 30
Section 6, Rule 13 of the Rules of Court states:
SEC. 6. Personal service. Service of the papers may be made by delivering
personally a copy to the party or his counsel, or by leaving it in his office with his
clerk or with a person having charge thereof. If no person is found in his office, or
his office is not known, or he has no office, then by leaving the copy, between the
hours of eight in the morning and six in the evening, at the party's or counsel's
residence, if known, with a person of sufficient age and discretion then residing
therein.
The affidavit of Mr. Robert O. Pagdilao, messenger of respondent's counsel states in part:
2. On 4 January 2001, Atty. Jose Vicente B. Salazar, then one of the
Associates of the ACCRA Law Offices, instructed me to deliver to the office of
Mr. BenjaminBitanga a letter dated 3 January 2001, pertaining to
Construction Industry Arbitration Commission (hereafter, "CIAC") Case No.

16
 99-56, entitled "Pyramid Construction Engineering Corporation vs. Macrogen
Realty Corporation".
3. As instructed, I immediately proceeded to the office of Mr. Bitanga located
at the 12th Floor, Planters Development Bank Building, 314 Senator Gil
Puyat Avenue, Makati City. I delivered the said letter to Ms. Dette Ramos, a
person of sufficient age and discretion, who introduced herself as one of the
employees of Mr. Bitanga and/or of the latter's companies. 31 (Emphasis
supplied.) SDIaCT
We emphasize that when petitioner signed the Contract of Guaranty and assumed obligation
as guarantor, his address in the said contract was the same address where the demand
letter was served. 32 He does not deny that the said place of service, which is the office of
Macrogen, was also the address that he used when he signed as guarantor in the Contract of
Guaranty. Nor does he deny that this is his office address; instead, he merely insists that the
person who received the letter and signed the receiving copy is not an employee of his
company. Petitioner could have easily substantiated his allegation by a submission of an
affidavit of the personnel manager of his office that no such person is indeed employed by
petitioner in his office, but that evidence was not submitted. 33 All things are presumed to
have been done correctly and with due formality until the contrary is proved. This juris
tantum presumption stands even against the most well-reasoned allegation pointing to
some possible irregularity or anomaly. 34 It is petitioner's burden to overcome the
presumption by sufficient evidence, and so far we have not seen anything in the record to
support petitioner's charges of anomaly beyond his bare allegation. Petitioner cannot now be
heard to complain that there was an irregular service of the demand letter, as it does not
escape our attention that petitioner himself indicated "314 Sen. Gil Puyat Avenue, Makati
City" as his office address in the Contract of Guaranty.
Moreover, under Section 6, Rule 13 of the Rules of Court, there is sufficiency of service when
the papers, or in this case, when the demand letter is personally delivered to the party or his
counsel, or by leaving it in his office with his clerk or with a person having charge thereof,
such as what was done in this case.
We have consistently expostulated that in summary judgments, the trial court can determine
a genuine issue on the basis of the pleadings, admissions, documents, affidavits or counter
affidavits submitted by the parties. When the facts as pleaded appear uncontested or
undisputed, then there is no real or genuine issue or question as to any fact, and summary
judgment is called for.
DOCTRINE
To forestall summary judgment, it is essential for the non-moving party to confirm the
existence of genuine issues, as to which he has substantial, plausible and fairly arguable
defense, i.e., 29 issues of fact calling for the presentation of evidence upon which
reasonable findings of fact could return a verdict for the non-moving party, although a mere
scintilla of evidence in support of the party opposing summary judgment will be insufficient
to preclude entry thereof. aIcDCA
Significantly, petitioner does not deny the receipt of the demand letter from the respondent.
He merely raises a howl on the impropriety of service thereof, stating that "the address to
which the said letter was sent was not his residence but the office of Macrogen Realty, thus
it cannot be considered as the correct manner of conveying a letter of demand upon him in
his personal capacity."

Pineda vs. Heirs of Guevara, 515 SCRA 627

17
FLORENTINO PINEDA VS. HEIRS OF ELISEO GUEVARA
G.R. No. 143188 February 14, 2007
TINGA, J.:

FACTS:
Respondents Eliseo Guevara, Jr., Zenaida G. Sapalicio, Dante G. Guevara and Isagani S.
Guevara, collectively referred hereinafter as the Guevara heirs, filed an action for the
nullification of the certificates of title of a parcel of land measuring approximately 2,304
hectares situated in Marikina. Named defendants were the estate of the late Pedro Gonzales,
Virginia Perez, Crisanta Perez, Jose Perez, Roy Guadalupe, Lino Bucad and Florentino Pineda.

The Guevara heirs alleged in the complaint that they were the co-owners of a property
originally issued in favor of the spouses Emiliano Guevara and Matilde Crimen. The couples
son, and the Guevara heirs predecessor-in-interest, Eliseo Guevara, allegedly purchased the
property and had exercised ownership over the property since then by selling and donating
portions thereof to third persons. The Guevara heirs averred that the sale of the property to
Eliseo Guevara was annotated at the back of the title.

According to the Guevara heirs, the defendants illegally claimed ownership and possession
over a certain portion of the property issued to the estate of Pedro C. Gonzales. Hence, the
Guevara heirs prayed that the OCT and its derivative titles be cancelled, and that the
Guevara heirs be declared owners of the property and that a new certificate of title be
issued in their names.

Defendant Pineda filed an answer with counterclaim, raising the defenses of lack of cause
of action, prescription, laches and estoppel. He averred that he was a buyer in good faith
and had been in actual possession of the land since 1970 initially as a lessor and
subsequently as an owner. He registered the property in his name and was issued a TCT
Defendants Virginia, Crisanta, and Jose, all surnamed Perez, filed an answer with
compulsory counterclaim and averred that their father, Marcos Perez, purchased the
property from the late Pedro Gonzales and had it declared in Perezs name for taxation
purposes. According to them, they had been in actual possession of a lot measuring 375
square meters before 1958 and had been regularly paying the property taxes thereon.
The rest of the defendants, including the estate of Pedro Gonzales, also filed an
answer with counterclaim, raising the same defenses of laches and prescription and res
judicata. They claimed that the was issued to the Municipality of Marikina in 1912 and that
the late Pedro Gonzales and his family started occupying the property as early as 1950 as
lessees thereon. The late Pedro Gonzales allegedly bought the property from the
Municipality of Marikina in a public bidding on 25 April 1966 and had allowed defendants to
occupy the property. They asserted that the Guevara heirs never actually occupied the
property.
The RTC set the case for hearing as if a motion to dismiss had been filed. During the
hearing, the parties presented oral arguments and were directed to file their memoranda.
After submission of memoranda, the RTC issued an Order dismissing the action on the
ground of laches. The Guevara heirs appealed the order of dismissal, claiming the denial of
their right to due process.
The Court of Appeals set aside the RTCs order of dismissal and directed the
reinstatement. The appellate court ruled that a complaint cannot be dismissed under Rule

18
16, Section 1 of the Rules of Court based on laches since laches is not one of the grounds
enumerated under said provision. Although the RTC order of dismissal did not rule on the
other affirmative defenses raised by petitioners in the answer, such as lack of cause of
action, prescription and res judicata, the Court of Appeals discussed them and ruled that
none of these affirmative defenses raised were present to warrant the dismissal of the
action.

The Court of Appeals denied Pinedas motion for consideration. Hence, the instant petition.

ISSUES: (1) Whether or not the appeal of the heirs of Guevara was improperly elevated to
the Court of Appeals since, according to them, it raised a pure question of law; and (2)
Whether or not the trial court correctly dismissed the action on the ground of laches without
conducting trial on the merits.

HELD:
Petitioner Pineda had ample opportunity to raise before the Court of Appeals the objection
on the improper mode of appeal taken by the heirs of Guevara. This, he failed to do. The
issue of improper appeal was raised only in Pinedas motion for reconsideration of the Court
of Appeals Decision. Hence, this Court cannot now, for the first time on appeal, pass upon
this issue. For an issue cannot be raised for the first time on appeal. In any case, the appeal
by the heirs of Guevara also raised the issue regarding the existence of laches on the part of
petitioners as defendants, which is factual in nature as discussed below.

Now, did the trial court correctly order the dismissal of the complaint based on laches
without conducting trial on the merits? The Court of Appeals disagreed, holding that under
Rule 16, Section 1 of the Rules of Court, laches is not enumerated under said provision,
hence, it must be proved during trial. On the other hand, petitioner Pineda asserts that
laches is analogous to prescription and, therefore, can be a ground of dismissing a complaint
as though a motion to dismiss is filed.

Well-settled is the rule that the elements of laches must be proved positively. Laches is
evidentiary in nature which could not be established by mere allegations in the pleadings
and cannot be resolved in a motion to dismiss. At this stage therefore, the dismissal of the
complaint on the ground of laches is premature. Those issues must be resolved at the trial of
the case on the merits wherein both parties will be given ample opportunity to prove their
respective claims and defenses.

Whether or not the elements of laches are present is a question involving a factual
determination by the trial court. There is no absolute rule as to what constitutes laches or
staleness of demand; each case is to be determined according to its particular
circumstances.

Laches is not concerned with the mere lapse of time; rather, the party must have been
afforded an opportunity to pursue his claim in order that the delay may sufficiently
constitute laches. Without prejudging the instant case, an apparent delay in the enforcement
of ones claim does not automatically constitute laches. The party charged with negligence or
omission in invoking his right must be afforded the opportunity to raise his defenses, which
can be accommodated only in a contentious proceeding. An apparent delay in the filing

19
of a complaint as shown in a pleading does not automatically warrant the
dismissal of the complaint on the ground of laches.

In the case at bar, while the trial court correctly set the case for hearing as though a motion
to dismiss had been filed, the records do not reveal that it extended to the parties the
opportunity to present evidence.

For instance, counsel for the heirs of Guevara filed and served written interrogatories on one
of the defendants but the trial court held in abeyance the resolution of the motion to order
the defendant to submit answers to the written interrogatories. The trial court likewise
denied the Ex Parte Motion To Set Trial filed by the heirs of Guevara. These were the
instances which would have enabled the trial court to receive evidence on which
to anchor its factual findings.

Although the trial court heard oral arguments and required the parties to submit
their respective memoranda, the presentation of evidence on the defenses which
are grounds for a motion to dismiss was not held at all. Otherwise, the oral
arguments and memoranda submitted by the parties would have enabled this Court to
review the trial courts factual finding of laches instead of remanding the case for trial on the
merits. A perusal of the records precludes this Court from making a categorical declaration
on whether the heirs of Guevara were guilty of laches.

Neither does the affirmative defense of prescription alleged in an answer

automatically warrant the dismissal of the complaint under Rule 16. An allegation of
prescription can effectively be used in a motion to dismiss only when the complaint on its
face shows that indeed the action has already prescribed. Otherwise, the issue of
prescription is one involving evidentiary matters requiring a full-blown trial on the merits and
cannot be determined in a mere motion to dismiss. Pinedas theory that the defense of
laches should be treated as an affirmative defense of prescription warranting the
dismissal of the complaint is erroneous.

There is also no basis in procedural law to treat the RTCs order of dismissal as a
summary judgment. The trial court cannot motu proprio decide that summary
judgment on an action is in order. Under the applicable provisions of Rule 35, the
defending party or the claimant, as the case may be, must invoke the rule on summary
judgment by filing a motion. The adverse party must be notified of the motion for summary
judgment and furnished with supporting affidavits, depositions or admissions before hearing
is conducted. More importantly, a summary judgment is permitted only if there is no genuine
issue as to any material fact and a moving party is entitled to a judgment as a matter of law.

Based on the parties allegations in the complaint and answer, the issues in the
case at bar are far from settled. For instance, both petitioner and respondents claim
their ownership rights over the same property based on two different original certificates of
title. Respondents charge petitioner of illegal occupation while the latter invokes good faith
in the acquisition of the property. Clearly, these are factual matters which can be best
ventilated in a full-blown proceeding before the trial court, especially when what are
involved appear to be sizeable parcels of land covered by two certificates of title.

20
Except for Pineda, the other defendants did not elevate the Court of Appeals Decision to this
Court. With respect to them, the appellate courts Decision has already become final and
conclusive, notwithstanding their adoption of Pinedas petition.

WHEREFORE, the instant petition for review on certiorari is DENIED and the Decision and
Resolution of the Court of Appeals are AFFIRMED. The records of the case be remanded for
further proceedings to the Regional Trial Court of Marikina City, which is hereby ORDERED to
try and decide the case with deliberate speed.

Bungcayao vs. Fort Ilocandia, G.R. No. 170483, April 19, 2010

MANUEL C. BUNGCAYAO, SR., represented in this case by his Attorney-in-fact ROMEL R.

BUNGCAYAO, petitioner, vs. FORT ILOCANDIA PROPERTY HOLDINGS AND DEVELOPMENT
CORPORATION, respondent.
CARPIO, J p:
FACTS:
PETITIONER: Manuel C. Bungcayao, Sr. claimed to be one of the two
entrepreneurs who introduced improvements on the foreshore area of Calayab Beach
in 1978 when Fort Ilocandia Hotel started its construction in the area. Other
entrepreneurs formed themselves as D'Sierto Beach Resort Owner's Association,
Inc. (D'Sierto) andbegan setting up their own stalls in the foreshore area.
In July 1980, FORT ILOCANDIA RESORT was ereceted on six parcels of land in
Barrio Balacad (now Calayad) that were transferred, ceded, and conveyed to the
Philippine Tourism Authority (PTA) pursuant to Presidential Decree No. 1704.
In 1992, petitioner and other D'Sierto members applied for a foreshore lease
with the Community Environment and Natural Resources Office (CENRO) and was
granted a provisional permit.
On 31 January 2002, Fort Ilocandia Property Holdings and Development
Corporation (respondent) filed a foreshore application over a 14-hectare area
abutting the Fort Ilocandia Property, including the 5-hectare portion applied for by
D'Sierto members.
DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES
The foreshore applications dispute was docketed as DENR Case No. 5473,
between respondent and D'Sierto members.
DENR Regional Executive Director Victor J. Ancheta denied the foreshore
lease applications of the D'Sierto members on the ground that the subject area
applied for fell either within the titled property or within the foreshore areas applied
for by respondent.
APPEAL:The D'Sierto members appealed the denial of their applications which
the DENR Secretary Elisea G. Gozun denied on the ground that the area applied for
encroached on the titled property of respondent based on the final verification
plan.
MEDIATION
In a letter dated 18 September 2003, respondent, through its Public Relations
Manager Arlene de Guzman, invited the D'Sierto members to a luncheon meeting to
discuss common details beneficial to all parties concerned.
Atty. Liza Marcos (Atty. Marcos), wife of Governor Bongbong Marcos, was
asked by Fort Ilocandia hotel officials to mediate over the conflict among
the parties.

21
 Atty. Marcos offered P300,000 as financial settlement per claimant in
consideration of the improvements introduced, on the condition that they would
vacate the area identified as respondent's property. D'Sierto made a counter-offer of
P400,000 to which the parties agreed on.
A D'Sierto made a counter-offer of P400,000, to which the other D'Sierto
members agreed.
Petitioner alleged that his son, Manuel Bungcayao, Jr., who attended the
meeting, manifested that he still had to consult his parents about the offer but
upon the undue pressure exerted by Atty. Marcos, he accepted the payment and
signed the Deed of Assignment, Release, Waiver and Quitclaim in favor of
respondent.
REGIONAL TRIAL COURT
Petitioner then filed an action for declaration of nullity of contract before
the RTC of Laoag, City.
Petitioner alleged that his son had no authority to represent him and that the
deed was void and not binding upon him.
Respondent countered that the area upon which petitioner and the other
D'Sierto members constructed their improvements was part of its titled property.
Respondent alleged that petitioner's sons, Manuel, Jr. and Romel, attended the
luncheon meeting on their own volition and they were able to talk to their parents
through a cellular phone before they accepted respondent's offer.
Respondents counterclaim: prayed that petitioner be required to return the
amount of P400,000 from respondent, to vacate the portion of the respondent's
property he was occupying, and to pay damages because his continued refusal
to vacate the property caused tremendous delay in the planned
implementation of Fort Ilocandia's expansion projects.
The trial court confirmed the agreement of the parties to cancel the Deed of
Assignment, Release, Waiver and Quitclaim and the return of P400,000 to
respondent.
Petitioner's counsel, however, manifested that petitioner was still maintaining
its claim for damages against respondent.
Petitioner and respondent agreed to consider the case submitted for
resolution on summary judgment. Which the court considered the case submitted for
resolution.
Petitioner filed a motion for reconsideration, alleging that he manifested in
open court that he was withdrawing his earlier manifestation submitting the case for
resolution.
Respondent filed a Motion for Summary Judgment.
The trial court rendered a Summary Judgment dated 13 February 2004.
The trial court ruled that the only issue raised by petitioner was his claim for
damages while respondent's issue was only his claim for possession of the property
occupied by petitioner and damages. The trial court noted that the parties already
stipulated on the issues and admissions had been made by both parties. The trial
court ruled that summary judgment could be rendered on the case.
SUMMARY JUDGMENT: The trial court ruled that the alleged pressure on
petitioner's sons could not constitute force, violence or intimidation that
could vitiate consent. As regards respondent's counterclaim, the trial court ruled that
based on the pleadings and admissions made, it was established that the property
occupied by petitioner was within the titled property of respondent.
COURT OF APPEALS
Petitioner appealed from the trial court's decision.
In its 21 November 2005 Decision, the Court of Appeals affirmed the trial
court's decision in toto.

22
 The Court of Appeals sustained the trial court in resorting to summary
judgment as a valid procedural device for the prompt disposition of actions in which
the pleadings raise only a legal issue and not a genuine issue as to any material
fact. The Court of Appeals ruled that in this case, the facts are not in dispute and
the only issue to be resolved is whether the subject property was within the
titled property of respondent. Hence, summary judgment was properly rendered by
the trial court.
The Court of Appeals ruled that the counterclaims raised by respondent were
compulsory in nature, as they arose out of or were connected with the transaction or
occurrence constituting the subject matter of the opposing party's claim and
did not require for its adjudication the presence of third parties of whom the court
could not acquire jurisdiction. The Court of Appeals ruled that respondent was the
rightful owner of the subject property and as such, it had the right to recover its
possession from any other person to whom the owner has not transmitted the
property, including petitioner.
ISSUE: Whether summary judgment is appropriate in this case.
HELD/DOCTRINE: Summary Judgment
Section 1, Rule 35 of the 1997 Rules of Civil Procedure provides:

Section 1.Summary Judgment for claimant. A party

seeking to recover upon a claim, counterclaim, or cross-claim or to obtain a
declaratory relief may, at any time after the pleading in answer thereto has
been served, move with supporting affidavits, depositions or admissions for a
summary judgment in his favor upon all or any part thereof.
Summary judgment has been explained as follows:
Summary judgment is a procedural device resorted to in order
to avoid long drawn out litigations and useless delays. When the pleadings on
file show that there are no genuine issues of fact to be tried, the Rules allow a
party to obtain immediate relief by way of summary judgment, that is, when
the facts are not in dispute, the court is allowed to decide the case summarily
by applying the law to the material facts.
Where the pleadings tender a genuine issue, summary
judgment is not proper.
"genuine issue" - is such issue of fact which requires the
presentation of evidence as distinguished from a sham, fictitious,
contrived or false claim.
Section 3 of the said rule provides two (2) requisites for
summary judgment to be proper: (1) there must be no genuine issue as to any
material fact, except for the amount of damages; and (2) the party presenting
the motion for summary judgment must be entitled to a judgment as a matter
of law.
A summary judgment is permitted only if there is no genuine
issue as to any material fact and a moving party is entitled to a judgment as a
matter of law.
A summary judgment is proper if, while the pleadings on their
face appear to raise issues, the affidavits, depositions, and admissions
presented by the moving party show that such issues are not genuine.
Since we have limited the issues to the damages claimed by the parties,
summary judgment has been properly rendered in this case.
The court modified the decision of the CA insofar as it ruled that respondent's
counterclaim for recovery of possession of the subject property is compulsory in
nature. We DISMISS respondent's permissive counterclaim without prejudice to filing
a separate action against petitioner.

23
NOTE: OTHER ISSUE OF THE CASE (NOT PART OF THE COVERAGE INCLUDED AS
ADDITIONAL INFORMATION)
ISSUE: Whether respondent's counterclaim is compulsory; and
HELD: Compulsory Counterclaim
A compulsory counterclaim is any claim for money or any relief, which a
defending party may have against an opposing party, which at the time of suit
arises out of, or is necessarily connected with, the same transaction or occurrence
that is the subject matter of the plaintiff's complaint.
It is compulsory in the sense that it is within the jurisdiction of the court,
does not require for its adjudication the presence of third parties over whom the
court cannot acquire jurisdiction, and will be barred in the future if not set up in the
answer to the complaint in the same case.
Any other counterclaim is permissive.
The Court has ruled that the compelling test of compulsoriness characterizes
a counterclaim as compulsory if there should exist a logical relationship between the
main claim and the counterclaim. The Court further ruled that there exists such a
relationship when conducting separate trials of the respective claims of the
parties would entail substantial duplication of time and effort by the parties and
the court; when the multiple claims involve the same factual and legal issues; or
when the claims are offshoots of the same basic controversy between the parties.

The criteria to determine whether the counterclaim is compulsory or

permissive are as follows:
(a) Are issues of fact and law raised by the claim and by the counterclaim largely the
same?
(b) Would res judicata bar a subsequent suit on defendant's claim, absent the
compulsory rule?
(c) Will substantially the same evidence support or refute plaintiff's claim as well as
defendant's counterclaim?
(d) Is there any logical relations between the claim and the counterclaim?
In this case, the only issue in the complaint is whether Manuel, Jr. is
authorized to sign the Deed of Assignment, Release, Waiver and Quitclaim in favor of
respondent without petitioner's express approval and authority. In an Order dated 6
November 2003, the trial court confirmed the agreement of the parties to cancel the
Deed of Assignment, Release, Waiver and Quitclaim and the return of P400,000 to
respondent. The only claim that remained was the claim for damages against
respondent. The trial court resolved this issue by holding that any damage suffered
by Manuel, Jr. was personal to him. The trial court ruled that petitioner could not have
suffered any damage even if Manuel, Jr. entered into an agreement with respondent
since the agreement was null and void.
Respondent filed three counterclaims. The first was for recovery of the
P400,000 given to Manuel, Jr.; the second was for recovery of possession of the
subject property; and the third was for damages. The first counterclaim was rendered
moot with the issuance of the 6 November 2003 Order confirming the agreement of
the parties to cancel the Deed of Assignment, Release, Waiver and Quitclaim and to
return the P400,000 to respondent. Respondent waived and renounced the third
counterclaim for damages. The only counterclaim that remained was for the recovery
of possession of the subject property. While this counterclaim was an offshoot of the
same basic controversy between the parties, it is very clear that it will not be
barred if not set up in the answer to the complaint in the same case. Respondent's

24
 second counterclaim, contrary to the findings of the trial court and the Court of
Appeals, is only a permissive counterclaim. It is not a compulsory counterclaim. It is
capable of proceeding independently of the main case.
The rule in permissive counterclaim is that for the trial court to acquire
jurisdiction, the counterclaimant is bound to pay the prescribed docket fees. Any
decision rendered without jurisdiction is a total nullity and may be struck down at any
time, even on appeal before this Court. 21 In this case, respondent did not dispute
the non-payment of docket fees. Respondent only insisted that its claims were
all compulsory counterclaims. As such, the judgment by the trial court in relation to
the second counterclaim is considered null and void without prejudice to a separate
action which respondent may file against petitioner.

Calubaquib vs. Republic, G.R. No. 170658, June 22, 2011

Facts :
President Manuel L. Quezon issued Proclamation No. 80, which declared a 39.3996-hectare
landholding located at Barangay Caggay, Tuguegarao, Cagayan, a military reservation site.
The proclamation expressly stated that it was being issued "subject to private rights, if any
there be." Accordingly, the respondent obtained an Original Certificate of Title No. 13562
over the property.
Respondent filed before the RTC of Tuguegarao, Cagayan a complaint for recovery of
possession against petitioners alleging that sometime in 1992, petitioners unlawfully
entered the military reservation through strategy and stealth and took possession of a five-
hectare portion of the property. Petitioners allegedly refused to vacate the subject property
despite repeated demands. Thus, respondent prayed that the petitioners be ordered to
vacate the subject property and to pay rentals computed from the time that they unlawfully
withheld the same from the respondent until the latter is restored to possession
Petitioners filed an answer denying the allegation. They maintained that they and their
predecessor-in-interest, Antonio Calubaquib, have been in open and continuous possession
of the subject property since the early 1900s. Their occupation of the subject property led
the latter to be known in the area as the Calubaquib Ranch. When Antonio died in 1918, his
six children acknowledged inheriting the subject property from him in a private document
entitled Convenio. In 1926, Antonios children applied for a homestead patent but the same
was not acted upon by the Bureau of Lands. Nevertheless, these children continued
cultivating the subject property.
Petitioners acknowledged the issuance of Proclamation No. 80 on August 17, 1936, but
maintained that the subject property was excluded from its operation. Petitioners cite as
their basis a proviso in Proclamation No. 80, which exempts from the military reservation site
"private rights, if any there be." Thus they prayed for the dismissal of the complaint.
A pre-trial conference was conducted. Given the trial courts opinion that the basic facts of
the case were undisputed, it advised the parties to file a motion for summary judgment.
Neither party filed the motion. In fact, respondent expressed on two occasions its objection
to a summary judgment. It explained that summary judgment is improper given the
existence of a genuine and vital factual issue, which is the petitioners claim of ownership
over the subject property. It argued that the said issue can only be resolved by trying the
case on the merits.
Thus the RTC issued an Order that the defendants in this case failed to raise any issue. For
this reason, a summary judgment is in order.
The trial court rendered decision dismissing petitioners claim of possession of the
subject property in the concept of owner. The trial court held that while Proclamation
No. 80 recognized and respected the existence of private rights on the military

25
 reservation, petitioners position could "not be sustained, as there was no right of
[petitioners] to speak of that was recognized by the government.
It was appealed in the CA. The CA reaffirmed the decision of the RTC.
The CA explained that in order to segregate the subject property from the mass of
public land, it was imperative for petitioners to prove their and their predecessors-in-
interests occupation and cultivation of the subject property for more than 30 years
prior to the issuance of the proclamation. There must be clear, positive and absolute
evidence that they had complied with all the requirements of the law for confirmation
of an imperfect title before the property became a military reservation site. Based on
these standards, petitioners failed to establish any vested right pertaining to them
with respect to the subject property. The CA further held that petitioners did not say
what evidence they had of an imperfect title under the Public Land Act.
The CA denied reconsideration of its Decision, thus appealed to the SC.
Petitioners Arguments
Petitioners maintain that the subject property was alienable land when they, through
their ancestors, began occupying the same in the early 1900s. By operation of law,
they became owners of the subject parcel of land by extraordinary acquisitive
prescription. Thus, when Proclamation No. 80 declared that "existing private rights, if
there be any" are exempt from the military reservation site, the subject property
remained private property of the petitioners.
Petitioners then ask that the case be remanded to the trial court for the reception of
evidence. They maintain that the case presents several factual issues, such as the
determination of the nature of the property (whether alienable or inalienable) prior to
1936 and of the veracity of petitioners claim of prior and adverse occupation of the
subject property.
Respondents Arguments
Respondent, through the Office of the Solicitor General, argues that petitioners were
not able to prove that they had a vested right to the subject property prior to the
issuance of Proclamation No. 80. As petitioners themselves admit, their application
for homestead patent filed in 1926 was not acted upon, hence they did not acquire
any vested right to the subject property. Likewise, petitioners did not prove their
occupation and cultivation of the subject property for more than 30 years prior to
August 17, 1936, the date when Proclamation No. 80 took effect.
Issue : Is the propriety of summary judgment correct.
Held : No. In the case at bar, the trial court proceeded to render summary judgment with
neither of the parties filing a motion therefore. In fact, the respondent itself filed an
opposition when the trial court directed it to file the motion for summary judgment.
Respondent insisted that the case involved a genuine issue of fact. Under these
circumstances, it was improper for the trial court to have persisted in rendering summary
judgment. Considering that the remedy of summary judgment is in derogation of a party's
right to a plenary trial of his case, the trial court cannot railroad the parties rights over their
objections.
Thus by proceeding to rule against petitioners without any trial, the trial and appellate
courts made a conclusion which was based merely on an assumption that petitioners
defense of acquisitive prescription was a sham, and that the ultimate facts pleaded in their
Answer (e.g., open and continuous possession of the property since the early 1900s) cannot
be proven at all. This assumption is as baseless as it is premature and unfair. No reason was
given why the said defense and ultimate facts cannot be proven during trial. The lower
courts merely assumed that petitioners would not be able to prove their defense and factual
allegations, without first giving them an opportunity to do so.

26
Summary judgments are proper when, upon motion of the plaintiff or the defendant, the
court finds that the answer filed by the defendant does not tender a genuine issue as to any
material fact and that one party is entitled to a judgment as a matter of law.
Relief by summary judgment is intended to expedite or promptly dispose of cases where the
facts appear undisputed and certain from the pleadings, depositions, admissions and
affidavits. But if there be a doubt as to such facts and there be an issue or issues of fact
joined by the parties, neither one of them can pray for a summary judgment. Where the
facts pleaded by the parties are disputed or contested, proceedings for a summary judgment
cannot take the place of a trial.
In spite of its expediting character, relief by summary judgment can only be allowed after
compliance with the minimum requirement of vigilance by the court in a summary hearing
considering that this remedy is in derogation of a party's right to a plenary trial of his case. A
party who moves for summary judgment has the burden of demonstrating clearly the
absence of any genuine issue of fact, or that the issue posed in the complaint is so patently
unsubstantial as not to constitute a genuine issue for trial, and any doubt as to the existence
of such an issue is resolved against the movant.
A summary judgment is permitted only if there is no genuine issue as to any material fact
and [the] moving party is entitled to a judgment as a matter of law." The test of the
propriety of rendering summary judgments is the existence of a genuine issue of fact," as
distinguished from a sham, fictitious, contrived or false claim."." A factual issue raised by a
party is considered as sham when by its nature it is evident that it cannot be proven or it is
such that the party tendering the same has neither any sincere intention nor adequate
evidence to prove it. This usually happens in denials made by defendants merely for the
sake of having an issue and thereby gaining delay, taking advantage of the fact that their
answers are not under oath anyway."
DOCTRINE : In determining the genuineness of the issues, and hence the propriety of
rendering a summary judgment, the court is obliged to carefully study and appraise, not the
tenor or contents of the pleadings, but the facts alleged under oath by the parties and/or
their witnesses in the affidavits that they submitted with the motion and the corresponding
opposition. Thus, it is held that, even if the pleadings on their face appear to raise issues, a
summary judgment is proper so long as "the affidavits, depositions, and admissions
presented by the moving party show that such issues are not genuine."

2. Rule 36 (Judgments, Final Orders and Entry)

BA Finance Corp. vs. CA, 229 SCRA 566 (1994)

BA FINANCE CORPORATION, petitioner,
vs.
COURT OF APPEALS AND WILSON SIY, respondents.

FACTS:

On 15 June 1976, Yanky Hardware Company, Inc. (YANKY, for brevity), applied for and was
granted by BA Finance Corporation a credit accommodation in the form of a discounting line
under which YANKY could from time to time discount with and assign its trade receivables to
petitioner. To secure the payment of all its loans, YANKY executed a chattel mortgage over
its stock-in-trade or merchandise inventory in favor of petitioner. To guarantee those loans,
Antonio Ngui Yek Siem, President and General Manager of YANKY, executed a continuing
suretyship agreement in favor of petitioner.

In time, petitioner demanded from YANKY the payment of its accumulated obligations which,

27
as of 20 October 1981, had allegedly reached the amount of P559,565.00, or the delivery of
the mortgaged chattels for purposes of extrajudicial foreclosure.

On 21 October 1981, petitioner filed with the then Court of First Instance a complaint against
YANKY and Antonio Ngui Yek Siem for replevin with damages or, in the alternative, payment
of the amount of P559,565.00 plus interest. Petitioner contended that it had the right to take
possession of the chattels described in the chattel mortgage or to be paid the total amount
of the loans plus interest since YANKY had breached the conditions of the chattel mortgage
by failing to pay the amounts secured thereby. Rizal Commercial Banking Corporation
(RCBC), China Banking Corporation (China Bank) and International Corporate Bank
(Interbank) intervened in the replevin case as creditors of YANKY. During the pre-trial
conference on 27 February 1984, RCBC moved for the sale at public auction of the replevied
chattels in order to prevent further depreciation of their value, which was granted.

In the auction sale, Lito Ramos was declared the highest bidder. Unfortunately, he failed to
remit the amount of his bid. As a consequence of his failure, another auction sale had to be
conducted and rescheduled on various dates. Eventually, a public auction sale was held And
the highest bidder was respondent Wilson Siy.

Petitioner then filed an Urgent Motion to Cancel Auction Sale stating that it was not given an
opportunity to participate in the sale and was deprived of its right to bid. On 1 June 1984,
the sheriff submitted a Sheriff's Report which detailed the factual antecedents of the auction
sale. The trial court then cancelled the auction sale.

On 6 June 1984, private respondent Siy, as the highest bidder in the 31 May 1984 auction
sale, filed his motion for reconsideration on the following grounds: (a) Petitioner was
afforded full opportunity to participate in the 31 May 1984 public auction sale; (b) The sale
of the properties in the public auction was consummated, thereby vesting legal title to the
movant as highest bidder who should not be deprived of such properties without due
process of law; and, (c) The bid price of movant, contrary to the allegation of petitioner, was
not shockingly low and hence was not a ground to nullify the public auction sale.

In an order dated 20 June 1984, the trial court granted the motion for
reconsideration and modified its 1 June 1984 order holding that respondent Siy
agreed to put up a surety bond subject to approval by the court to justify the
release to him of the properties purchased at auction.

Respondent Siy submitted a surety bond of P140,000.00. The sheriff delivered assorted
hardware materials to Siy and submitted a Sheriff's Report on the properties actually
delivered. However, the sheriff subsequently informed the court that what he delivered to
Siy were substantially less than those listed in the Notice of Sheriff's Sale dated 3 April 1984.

On 24 July 1984, private respondent filed his motion to compel delivery of certain chattels
sold in the auction sale but not delivered by petitioner to him. In an order dated 27 July
1984, the trial court directed petitioner to produce and/or account for the undelivered
properties.

Petitioner moved to reconsider the foregoing order, but without success. On 24 September
1985, the trial court issued an order requiring petitioner to deliver the alleged missing
chattels or their value.

This time, Siy filed a motion for reconsideration contending that because petitioner was
depository of the chattels, it should be made liable to him for damages for having failed to
deliver the chattels listed in the 27 October 1981 inventory.

28
On 22 January 1986, the trial court issued an order amending and/or modifying
the order of 24 September 1985, and directed petitioner to deliver to Siy the
properties appearing in the inventory attached to the Sheriff's Report of 5
November 1981 minus the properties already delivered on 28 June 1984, and if
this be not possible, to pay the equivalent amount thereof.

Twenty-three days after its receipt of the aforementioned order, petitioner filed its notice of
appeal and a record on appeal

RTC's RULING:

Disapproved at first due to late filing, but was later ordered by the Supreme Court to
approve the notice of appeal and record on appeal filed by petitioner because the same was
actually filed within the reglementary period of thirty (30) days.

CA's RULING:

Directed petitioner to deliver to respondent Siy certain properties appearing in the inventory
attached to the Sheriff's Report of 5 November 1981. The appellate court considered the first
and second errors assigned by petitioner as moot and academic. In these assigned errors,
petitioner questioned the 20 June 1984 order of the trial which, in effect, permitted the
intervention of respondent Siy by entertaining his motion for reconsideration and allowing
him to put up a surety bond to justify the release of the properties to him. The Court of
Appeals held that petitioner could no longer appeal the 20 June 1984 order because it was
already way beyond the reglementary period to appeal.

Petitioner's motion for reconsideration of the decision was denied.

ISSUE:

Whether or not the Court of Appeals erred in not allowing petitioner's appeal from the order
of the trial court of 20 June 1984 and in affirming the order of the trial court of 22 January
1986.

Note: June 20 order---permitted the intervention of respondent Siy and ordered the release of
the properties purchased by the latter at the auction sale.

January 22 order---directed petitioner to deliver to respondent Siy as highest bidder the

properties appearing in the inventory attached to the Sheriff's Report.

SC's RULING:

NO. In its first assigned error, petitioner submits that the order of 20 June 1984 was merely
interlocutory hence unappealable, and that in appealing the final order of 22 January 1986, it
should be allowed to question the order of 20 June 1984 because its reversal will necessarily
render null and void the final order of 22 January 1986. Petitioner also argues that the trial
court erred in allowing the intervention of respondent Siy as the legal requisites for
intervention were not complied with, and in not setting aside the auction sale of 31 May
1984 which involved many irregularities, to wit: (a) The price of P60,000.00 realized in the
bidding was grossly inadequate; (b) There was undue haste in the conduct of the sale; and,
(c) The deputy sheriff conducted the sale in the absence of petitioner or its duly authorized
representative.

In BA Finance Corporation v. Court of Appeals, supra, which involved the same parties, this
Court noted that the principal case filed with the trial court by petitioner against YANKY was

29
for replevin or, in the alternative, for collection of the amount of the loans, plus interest
owed by YANKY. This Court likewise noted that the disputed order of 22 January 1986, subject
of the present appeal, only directed petitioner to turn over to respondent Siy properties
which had remained undelivered to the latter as highest bidder, a matter which was merely
an incident of the principal case. However, this Court recognized therein that the order of
the trial court was already final so far as it concerned the dispute between petitioner and
respondent Siy because it was to resolve the right of the latter to receive the disputed
properties and petitioner's obligation to deliver those properties to Siy. This is based on the
settled rule that only a final order or judgment on the merits may be the subject of an
appeal. A final order is defined as one which disposes of the whole subject matter or
terminates a particular proceeding or action, leaving nothing to be done but to enforce by
execution what has been determined; on the other hand, an order is interlocutory if it does
not dispose of a case completely, but leaves something more to be done upon its merits. 3

Hence, the argument of petitioner that it can still question the order of 20 June 1984 while
appealing the final order of 22 January 1986 is untenable. It may be true that the 20 June
1984 order allowed the intervention of respondent Siy and reversed the court's previous
order setting aside the auction sale by allowing him to put up a surety bond to justify the
release of the properties to him. However, upon submission by Siy of a surety bond with the
court, the latter issued a final order dated 28 June 1984, which was issued earlier than the
final order of 22 January 1986. The order of 28 June 1984 directed the delivery of the
auctioned properties to respondent Siy.

Although the order of 20 June 1984 may be considered interlocutory as it required

something more to be done by respondent Siy, i.e., the filing of the bond, the subsequent
order of 28 June 1984 can be considered a final one which determined and settled the issue
on the validity of the auction sale and the right of respondent Siy as highest bidder to
acquire the properties he purchased. Petitioner should have appealed the 28 June 1984
order if it wanted to question the validity of the intervention of respondent Siy as well as of
the auction sale. But it did not do so. Moreover, records show that after the issuance of the
order of 28 June 1984 directing the delivery of the properties to Siy, the remaining
proceedings in the trial court pertained only to the execution and implementation by the
sheriff of the order of 28 June 1984. Hence, when the deputy sheriff informed the court that
what were delivered to Siy were less than those listed in the Notice of Sheriff's Sale,
respondent Siy filed on 24 July 1984 a motion to compel delivery.

In its third assigned error, petitioner contends that it had no knowledge of the reinventory
attached to the Sheriff's Report of 5 November 1981 as it was not furnished copy thereof;
that what was sold to Siy in the auction sale of 31 May 1984 were pieces of "assorted
hardware" as indicated in the notice of sale of 21 May 1984 and which were on display inside
the warehouse of petitioner, and not those listed in the inventory attached to the Sheriff's
Report of 5 November 1981.

The issue raised here by petitioner involves a question of fact which is not reviewable by this
Court in this petition. The jurisdiction of this Court in cases brought to it from the Court of
Appeals is limited to reviewing and revising the errors of law imputed to it, its findings of fact
being conclusive. It is not the function of the Supreme Court to analyze or weigh such
evidence all over again, its jurisdiction being limited to reviewing errors of law that might
have been committed, unless there is a showing that the findings complained of are totally
devoid of support in the record or that they are so glaringly erroneous as to constitute
serious abuse of discretion.

DOCTRINES:

1. Only a final order or judgment on the merits may be the subject of an appeal. A final order

30
is defined as one which disposes of the whole subject matter or terminates a particular
proceeding or action, leaving nothing to be done but to enforce by execution what has been
determined; on the other hand, an order is interlocutory if it does not dispose of a case
completely, but leaves something more to be done upon its merits.

2. The jurisdiction of the Supreme Court in cases brought to it from the Court of Appeals is
limited to reviewing and revising the errors of law imputed to it, its findings of fact being
conclusive. It is not the function of the Supreme Court to analyze or weigh such evidence all
over again, its jurisdiction being limited to reviewing errors of law that might have been
committed, unless there is a showing that the findings complained of are totally devoid of
support in the record or that they are so glaringly erroneous as to constitute serious abuse
of discretion.

Ting vs. Velez-Ting, G.R. No. 166562, March 31, 2009

FACTS:
Petitioner Benjamin Ting (Benjamin) and respondent Carmen Velez-Ting (Carmen) first met in
1972 while they were classmates in medical school. They fell in love, and they were wed on
July 26, 1975 in Cebu City when respondent was already pregnant with their first child.
At first, they resided at Benjamins family home in Maguikay, Mandaue City. When their
second child was born, the couple decided to move to Carmens family home in Cebu City. In
September 1975, Benjamin passed the medical board examinations and thereafter
proceeded to take a residency program to become a surgeon but shifted to anesthesiology
after two years. By 1979, Benjamin completed the preceptorship program for the said field
and, in 1980, he began working for Velez Hospital, owned by Carmens family, as member of
its active staff, while Carmen worked as the hospitals Treasurer.
The couple begot six (6) children, namely Dennis, born on December 9, 1975; James Louis,
born on August 25, 1977; Agnes Irene, born on April 5, 1981; Charles Laurence, born on July
21, 1986; Myles Vincent, born on July 19, 1988; and Marie Corinne, born on June 16, 1991.
On October 21, 1993, after being married for more than 18 years to petitioner and while
their youngest child was only two years old, Carmen filed a verified petition before the RTC
of Cebu City praying for the declaration of nullity of their marriage based on Article 36 of the
Family Code. She claimed that Benjamin suffered from psychological incapacity even at the
time of the celebration of their marriage, which, however, only became manifest thereafter.
In her complaint, Carmen stated that prior to their marriage, she was already aware that
Benjamin used to drink and gamble occasionally with his friends. But after they were
married, petitioner continued to drink regularly and would go home at about midnight or
sometimes in the wee hours of the morning drunk and violent. He would confront and insult
respondent, physically assault her and force her to have sex with him. There were also
instances when Benjamin used his gun and shot the gate of their house. Because of his
drinking habit, Benjamins job as anesthesiologist was affected to the point that he often had
to refuse to answer the call of his fellow doctors and to pass the task to other
anesthesiologists. Some surgeons even stopped calling him for his services because they
perceived petitioner to be unreliable. Respondent tried to talk to her husband about the
latters drinking problem, but Benjamin refused to acknowledge the same.
Carmen also complained that petitioner deliberately refused to give financial support to
their family and would even get angry at her whenever she asked for money for their
children. Instead of providing support, Benjamin would spend his money on drinking and
gambling and would even buy expensive equipment for his hobby. He rarely stayed home
and even neglected his obligation to his children.

31
 Aside from this, Benjamin also engaged in compulsive gambling. He would gamble two or
three times a week and would borrow from his friends, brothers, or from loan sharks
whenever he had no money. Sometimes, Benjamin would pawn his wifes own jewelry to
finance his gambling. There was also an instance when the spouses had to sell their family
car and even a portion of the lot Benjamin inherited from his father just to be able to pay off
his gambling debts. Benjamin only stopped going to the casinos in 1986 after he was
banned therefrom for having caused trouble, an act which he said he purposely committed
so that he would be banned from the gambling establishments
CARMENS ALLEGATION:
allegations of Benjamins psychological incapacity consisted of the following manifestations:

1. Benjamins alcoholism, which adversely affected his family relationship and his profession;
2. Benjamins violent nature brought about by his excessive and regular drinking;
3. His compulsive gambling habit, as a result of which Benjamin found it necessary to sell
the family car twice and the property he inherited from his father in order to pay off his
debts, because he no longer had money to pay the same; and
4. Benjamins irresponsibility and immaturity as shown by his failure and refusal to give
regular financial support to his family

BENJAMINS ANSWER:
denied being psychologically incapacitated. He maintained that he is a respectable person,
as his peers would confirm. He said that he is an active member of social and athletic clubs
and would drink and gamble only for social reasons and for leisure. He also denied being a
violent person, except when provoked by circumstances. As for his alleged failure to support
his family financially, Benjamin claimed that it was Carmen herself who would collect his
professional fees from Velez Hospital when he was still serving there as practicing
anesthesiologist. In his testimony, Benjamin also insisted that he gave his family financial
support within his means whenever he could and would only get angry at respondent for
lavishly spending his hard-earned money on unnecessary things. He also pointed out that it
was he who often comforted and took care of their children, while Carmen played mahjong
with her friends twice a week.

Later on, they both presented as witness their own psychiatrist. For Carmen, Dr. Onete,
instead of the usual personal interview his evaluation of Benjamin was limited to the
transcript of stenographic notes taken during Benjamins deposition because the latter had
already gone to work as an anesthesiologist in a hospital in South Africa. After reading the
transcript of stenographic notes, Dr. Oate concluded that Benjamins compulsive drinking,
compulsive gambling and physical abuse of respondent are clear indications that petitioner
suffers from a personality disorder. For Benjamin, Dr. Obra evaluated Benjamins
psychological behavior based on the transcript of stenographic notes, as well as the
psychiatric evaluation report prepared by Dr. A.J.L. Pentz, a psychiatrist from the University
of Pretoria in South Africa, and his (Dr. Obras) interview with Benjamins brothers. Contrary
to Dr. Oates findings, Dr. Obra observed that there is nothing wrong with petitioners
personality, considering the latters good relationship with his fellow doctors and his good
track record as anesthesiologist.

RTC:

32
The marriage between petitioner and respondent null and void. The RTC gave credence to
Dr. Oates findings and the admissions made by Benjamin in the course of his deposition,
and found him to be psychologically incapacitated to comply with the essential obligations of
marriage. Specifically, the trial court found Benjamin an excessive drinker, a compulsive
gambler, someone who prefers his extra-curricular activities to his family, and a person with
violent tendencies, which character traits find root in a personality defect existing even
before his marriage to Carmen.
CA:
reversing the trial courts ruling. It faulted the trial courts finding, stating that no proof was
adduced to support the conclusion that Benjamin was psychologically incapacitated at the
time he married Carmen since Dr. Oates conclusion was based only on theories and not on
established fact,39 contrary to the guidelines set forth in Santos v. Court of Appeals40 and
in Rep. of the Phils. v. Court of Appeals and Molina. Later on, CA issued an Amended Decision
reversing its first ruling and sustaining the trial courts decision after filing a petition for
certiorari.

ISSUE:
Whether or not a court should follow the stare decisis rule

HELD:
SC reversed the trial courts and the appellate courts rulings declaring the marriage
between petitioner and respondent null and void ab initio.
The leading case in deciding whether a court should follow the stare decisis rule in
constitutional litigations is Planned Parenthood v. Casey. It established a 4-pronged test. The
court should (1) determine whether the rule has proved to be intolerable simply in defying
practical workability; (2) consider whether the rule is subject to a kind of reliance that would
lend a special hardship to the consequences of overruling and add inequity to the cost of
repudiation; (3) determine whether related principles of law have so far developed as to
have the old rule no more than a remnant of an abandoned doctrine; and, (4) find out
whether facts have so changed or come to be seen differently, as to have robbed the old
rule of significant application or justification.
To be forthright, respondents argument that the doctrinal guidelines prescribed in Santos
and Molina should not be applied retroactively for being contrary to the principle of stare
decisis is no longer new. The same argument was also raised but was struck down in Pesca
v. Pesca, and again in Antonio v. Reyes. In these cases, we explained that the interpretation
or construction of a law by courts constitutes a part of the law as of the date the statute is
enacted. It is only when a prior ruling of this Court is overruled, and a different view is
adopted, that the new doctrine may have to be applied prospectively in favor of parties who
have relied on the old doctrine and have acted in good faith, in accordance therewith under
the familiar rule of "lex prospicit, non respicit."

San Pedro vs. Binaloy, August 25, 2005

AMANTE O. SAN PEDRO, petitioner, vs. MARCIANA M. BINALAY, assisted by her husband
ROBERTO BULURAN and WILSON M.BINALAY,respondents.
FACTS:

33
In the RTC Tuguegarao, Cagayan, petitioner Amante D. San Pedro instituted an action for
"Specific Performance with Damages" against the respondents. In his complaint, petitioner
alleged that the respondents executed in his favor a deed of absolute sale over a parcel of
land with an area of 219sqm and covered by TCT of the Registry of Deeds of Cagayan.
Petitioner further averred that respondents have failed to cause the registration of the deed
of sale. He thus prayed for the declaration of his ownership over the subject piece of land,
the registration of the deed and the issuance of the corresponding certificate of title in his
name.
Respondents: In their verified "Answer" with counterclaim, denied having executed the deed
of sale relied upon by the petitioner, alleging that they never sold the parcel of land to
anybody, let alone to petitioner. They also contend that such deed is fictitious and a
falsification.
After pre-trial but before the presentation of his evidence, petitioner, as plaintiff filed a
Motion to Withdraw Complaint, praying for dismissal on the ground:
1.That the complaint has been filed, way back in May 23, 1985, and that the undersigned
plaintiff is no longer interested to further prosecute the above-entitled case, provided the
defendants herein will also dismissed (sic) their counterclaims;
2. That in order not to clog the docket of this court the undersigned prays for the
dismissal of the above-entitled case. EACIaT
Respondents: interposed a Manifestation and Counter-Motion wherein they expressed
conformity to the desired dismissal of petitioner's complaint and their counterclaim,
provided such dismissal is with prejudice.
In the hearing on the motion to withdraw and counter-motion, petitioner and respondents
mutually agreed to the dismissal with prejudice of their complaint and counterclaim,
respectively. Thus
TC: Acting on the Motion to Withdraw complaint by the plaintiff as well as the Motion of his
counsel and the Motion of counsel for the defendants, and finding the former to be well-
taken, let this case be dismissed with prejudice. . . . .The Counterclaim of the defendants is
ordered dismissed.
Petitioner: (A little over a year later) again filed suit against respondents with the same RTC,
this time for "Recovery of Possession and Ownership with Damages". seeking to recover
possession and ownership of the SAME land.
Respondents: filed MTD on ground of res judicata, arguing that a similar case earlier
instituted by the petitioner against them had already been dismissed with prejudice.
TC: granted respondents' MTD and accordingly dismissed on ground of res judicata.
Petitioner: appealed to the CA.
CA: Affirmed the TC order of dismissal on the following ratiocination that said motion with
the corresponding manifestation filed thereto by defendants-appellees [respondents herein]
was NOT perfunctorily granted but was in fact set for hearing and in the said hearing, both
parties agreed to the dismissal of the complaint with prejudice. And in accordance with the
agreement of both parties, the trial court issued the Order dismissing the case with
prejudice. Thus, as aptly stated by Vicente Francisco in his book "The Revised Rules of Court
in the Phils.", Vol. 1, Annotated, Second Edition, 1973, p. 986,
A plaintiff's dismissal of a suit with prejudice is as conclusive of the rights of
the parties as an adverse judgment after trial, being res judicata of all
questions which might have been litigated in the suit.

34
CA: denied MR. Hence, petitioner's present recourse

ISSUE
W/N there is res judicata

HELD:
Petition DENIED. There is identity of causes of action in the two (2) civil cases.
Petitioner contends that the cause of action is an accion reivindicatoria to recover
possession and ownership of the same land. This dissimilarity, according to petitioner,
argues against the applicability of the res judicata principle.
Section 47, Rule 39 of the Rules of Court, which pertinently reads:
SEC. 47. Effect of judgments or final orders. The effect of a judgment or final order
rendered by a court of the Philippines, having jurisdiction to pronounce judgment or final
order, may be as follows:
xxx xxx xxx
(b) In other cases, the judgment or final order is, with respect to the matter directly
adjudged or as to any other matter that could have been raised in relation thereto,
conclusive between the parties and their successors in interest by title subsequent to the
commencement of the action or special proceeding litigating for the same thing and
under the same title and in the same capacity; and
(c) In any other litigation between the same parties or their successors in interest, that
only is deemed to have been adjudged in a former judgment or final order which appears
upon its face to have been so adjudged, or which was actually and necessarily included
therein or necessary thereto.
Contrary to petitioner's submission, there is identity of causes of action in the two (2) civil
cases. We shall explain.
Causes of action are identical when there is an identity in the facts essential to the
maintenance of the two actions or where the same evidence will sustain both actions. If the
same facts or evidence can sustain either, the two actions are considered the same, so that
the judgment in one is a bar to the other.
As may readily be deduced from the averments in the complaint in Civil Case No. 3467, the
ownership of the land in question is tendered as an issue and what petitioner is asking
thereat is for the trial court to order the respondents to deliver to him the title and
necessarily ownership of the same parcel of land he allegedly purchased from them. At the
other end, Civil Case No. 4404 is a suit for recovery of possession and ownership of the
same land sought to be recovered in Civil Case No. 3467. In net effect, petitioner's
ultimate objective in instituting the two actions is to peremptorily secure title,
possession and ownership of the same piece of land.
In the first, as in the second case, the controversy turns on petitioner's right of dominion
over a piece of real estate pursuant to a deed of sale purportedly executed by the
respondents in his favor. In fine, petitioner's cause in either case could plausibly prosper only
upon proof of the fact of a valid sale covering the land in dispute. And such fact can in turn
be established by evidence showing that the deed of absolute sale appended to the
complaint in the first case is authentic.

35
As it were, however, respondents denied having sold the subject land to petitioner and
specifically denied the genuineness and due execution of the conveying deed. Instead,
however, of demonstrating by competent preponderating evidence the superiority of his
case and, in the process, demolishing respondents' denial of the fact of sale, petitioner made
a deliberate retreat and took the first step which eventually led to the dismissal with
prejudice of his first complaint. By himself no less moving for such dismissal after going to
all the trouble and expense of initiating a lawsuit, petitioner virtually conceded that he had
no case against respondents; that his claim of ownership is a sham; and that the very
document supportive of such claim is, as asserted by respondents, spurious.
Prescinding from the foregoing premises, it is indubitable that there is, as between the two
actions, an identity of rights asserted and reliefs prayed for, as well as of the facts from
which the reliefs are founded. Moreover, the evidence to support petitioner's cause of action
in the specific performance case (Civil Case No. 3467) is included and forms part of the
evidence he needed to support his cause of action in the case for recovery of possession and
ownership (Civil Case No. 4404). There cannot, therefore, be a serious dispute as to the
identity of causes of action in Civil Case No. 3467 and Civil Case No. 4404. The difference in
form of the two actions or, however petitioner styled each, is of no moment. A party cannot
evade the preclusive effect of res judicata by the simple expedient of varying the form of the
action or by adopting a different mode of presenting his case.The doctrine of res judicata will
apply as long as the parties are litigating for the same thing and more importantly, the same
contentions. As can be gleaned from the records, petitioner's arguments in Civil Case No.
3467 bear extreme resemblance with those raised in Civil Case No. 4404.
But even if we were to assume purely ex hypothesi that the cause of action in Civil Case No.
3467 is not identical to that in Civil Case No. 4404, petitioner could still not escape from the
clutches of res judicata. For, consistent with the principle of conclusiveness of judgment, all
relevant issues actually or deemed adjudged and settled finally in the first case, i.e., the
absence of the sale transaction covering the disputed land and the fictitious nature of the
deed of sale allegedly executed by and between petitioner and respondents over the same
land, are deemed conclusive between the parties in the second case. ECSaAc
Given the foregoing perspectives, petitioner's plea to relax the rule on res judicata since its
application in this case would, to him, result in injustice. It was petitioner himself who moved
for the dismissal of his own complaint in Civil Case No. 3467, doubtless after realizing the
untenability of his case, anchored as it were on a fictitious deed of sale. Accordingly,
petitioner cannot now be permitted to benefit from his own undoing. Once a litigant's rights
had been adjudicated in a valid final judgment of a competent court, he should not be
granted an unbridled license to come back for another try.
DOCTRINE:
By force of res judicata, a final judgment is conclusive not only on the issues
actually determined by the decision but on all issues that could have been raised
or litigated in the anterior suit. In fine, when material facts or questions which
were in issue in a former action and were there admitted or judicially determined
are conclusively settled by a judgment rendered therein, such facts or questions
become res judicata and may not again be litigated in a subsequent action
between the same parties or their privies, regardless of the form of the latter.
This is, as it should be, for a judgment is an adjudication on all matters which are
essential to support it and that every proposition assumed or decided by the
court leading up to the final conclusion and upon which such conclusion is
reached is as effectually passed upon as the ultimate question which is finally
solved.
Other important details:

36
JUDGMENT; RES JUDICATA; CONSTRUED. Section 47, Rule 39 of the Rules of Court
enunciates the principle of res judicata to the end that controversies once decided on the
merits by a court of sufficient jurisdiction shall remain in repose. The principle has two (2)
aspects: a) as a bar to the prosecution of a subsequent action based on the same claim or
cause of action; and b) as preclusion to the relitigation of particular issues or facts in another
action between the same parties on a different demand or cause of action. The first aspect
corresponds to the aforequoted par. (b) of Section 39 of Rule 47, while the second is
embodied in paragraph (c) of the same Section. This Court has explained the distinction
between the two concepts embraced in the res judicata principle in the following wise: There
is no question that where as between the first case where the judgment is rendered and the
second case where such judgment is invoked, there is identity of parties, subject matter and
cause of action, the judgment on the merits in the first case constitutes an absolute bar to
the subsequent action not only as to every matter which was offered and received to sustain
or defeat the claim or demand, but also as to any other admissible matter which might have
been offered for that purpose and to all matters that could have been adjudged in that case.
This is designated as "bar by former judgment." But where the second action between the
same parties is upon a different claim or demand, the judgment in the prior action operates
as an estoppel only as to those matter in issue or points controverted, upon the
determination of which the finding or judgment was rendered. In fine, the previous judgment
is conclusive in the second case only as those matters actually and directly controverted and
determined and not as to matters merely involved therein. This is the rule on
'conclusiveness of judgment' . . . .
3ELEMENTS. For res judicata to serve as an absolute bar to a subsequent action, the
following requisites must concur: (1) there must be a final judgment or order; (2) the court
rendering it must have jurisdiction over the subject matter and the parties; (3) it must be a
judgment or order on the merits; and (4) there must be between the two cases identity of
parties, subject matter and causes of action. There can be no quibbling that the first three
(3) requisites adverted to above obtain in this case. So too are the elements of identity of
parties and subject matter mentioned in the fourth requisite. There is thus no need to
belabor the point, as even petitioner himself concedes the presence of all the requisites
adverted to, his only challenge against the applicability of the res judicata principle being
limited to the absence of "identity of the causes of action between Civil Case No. 4404 and
Civil Case No. 3467".
CAUSE OF ACTION; ELEMENTS. Rule 2, Section 2 of the Rules of Court defines "cause of
action" as the act or omission by which a party violates the right of another. Its elements
are: (1) the existence of a legal right in the plaintiff; (2) a correlative obligation on the part of
the defendant; and (3) an act or omission of the defendant in violation of said legal right for
which the plaintiff may maintain an action for recovery of damages or other appropriate
reliefs. Causes of action are identical when there is an identity in the facts essential to the
maintenance of the two actions or where the same evidence will sustain both actions. If the
same facts or evidence can sustain either, the two actions are considered the same, so that
the judgment in one is a bar to the other.

Lacurom vs. Tienzo, 535 SCRA 253

FACTS:
For resolution is an administrative complaint charging Judge Tienzo of the RTC
Cabanatuan City with Gross ignorance of the Law or Procedure in connection with 2 separate
cases: one is for Replevin or Sum of Money, while the other is an appealed case of Unlawful
Detainer.

37
 On the first charge, complainant, Atty. Ubaldino A. Lacurom, assails the issuance by
respondent judge of a writ of replevin in Civil Case No. 4971. According to complainant,
respondent judge should have desisted from issuing the writ as plaintiff Claudio in Civil Case
No. 4971 failed to prove that he is the owner of the subject vehicle, and consequently
entitled to its possession. On the second charge relating to Civil Case No. 4884, complainant
alleges that respondent judge rendered a Decision in violation of the constitutional mandate
to state clearly and distinctly the facts and the law on which it is based, and Section 1, Rule
36 of the Rules of Court echoing the same requisite. Complainant further charges that
respondent judge issued an order written in the English language, and in a fashion that does
not befit an RTC Judge which thereby demonstrates her incompetence and lack of diligence.
In response, respondent judge vehemently oppose and prayed for outright dismissal
of the case. The respondent judge posits that the proper parties are the defendants-litigants
whose interests were ostensibly aggrieved and prejudiced by the Order of Release of the
vehicle and that the issuance of the writ or replevin was done in the discharge of her judicial
function, and that even if the Order was erroneously issued, complainants proper remedy is
to file a petition for certiorari or an appeal, as may be applicable, and not the instant
administrative case.

OCA: On the second issue pertaining to the minute of the decision in the Unlawful Detainer
case, the OCA found respondent judge guilty of gross ignorance of the law or procedure in
her blatant disregard of the constitutional mandate that no decision shall be rendered by
any court without expressing therein clearly and distinctly the facts and the law on which it
is based.

ISSUE: WON Judge Tienzo guilty of gross ignorance of the law or procedure in her blatant
disregard of the constitutional mandate that no decision shall be rendered by any court
without expressing therein clearly and distinctly the facts and the law on which it is based.

SC: YES. In that case, respondent judge ruled in this wise, to wit:

DECISION

After a cursory study of this appealed case of Unlawful Detainer, this Court finds that the
procedural due process [has] been complied with under the Summary Procedure. The
Decision of the Lower Court cannot be disturbed by this Court.

WHEREFORE, the Decision of the said Lower Court, MTCC, Branch III,Cabanatuan City, is
hereby AFFIRMED en toto.

Section 1, Rule 36 of the Rules of Court reflects the foregoing mandate, thus:

SECTION 1. Rendition of judgments and final orders. A judgment or final order

determining the merits of the case shall be in writing personally and directly prepared
by the judge, stating clearly and distinctly the facts and the law on which it is based,
signed by him, and filed with the clerk of court.

The memorandum decision, to be valid, cannot incorporate the findings of fact and
the conclusions of law of the lower court only by remote reference, which is to say that the

38
challenged decision is not easily and immediately available to the person reading the
memorandum decision. For the incorporation by reference to be allowed, it must provide for
direct access to the facts and the law being adopted, which must be contained in a
statement attached to the said decision. It is expected that this requirement will allay
suspicion that no study was made of the decision of the lower court and that its decision was
merely affirmed without a proper examination of the facts and law on which it is based. The
proximity at least of the annexed statement should suggest that such an examination has
been undertaken. The Court finds it necessary to emphasize that the memorandum decision
should be sparingly used lest it become an addictive excuse for judicial sloth. It is an
additional condition for its validity that this kind of decision may be resorted only in cases
where the facts are in the main accepted by both parties or easily determinable by the judge
and there are no doctrinal complications involved that will require an extended discussion of
the laws involved. It is obvious that the decision rendered by respondent judge failed to
conform to this requirement. Nowhere in the decision does respondent judge make a
statement of the facts which led to the filing of the appeal. More importantly, the decision
does not contain respondent judges factual findings, albeit affirming those of the MTCC, from
which she based her conclusions of law. Ineluctably, respondent judge transgressed the
constitutional directive.

DOCTRINE: A judgment or final order determining the merits of the case shall be
in writing personally and directly prepared by the judge, stating clearly and
distinctly the facts and the law on which it is based, signed by him, and filed with
the clerk of court.

DELA MERCED vs GSIS

G.R. No 167140, November 22, 2011
PETITIONERS: Francisco dela Merced substituted by his heirs Luis Ceasar dela Merced,
Blanquita dela Merced-Macatangay and Maria Olivia Paredes.
RESPONDENTS: Government Service Insurance System and Spouses Victor and Milagros
Manlongat
PONENTE: Del Catillo, J.

FACTS:
This case involves 5 registered lands located in Pasig City (Antonio Subdivision). Originally
owned by and titled in the name of JOSE ZULUETA. Later Spouses Zulueta mortgaged several
lots to GSIS which eventually foreclosed on the mortgaged properties including the subject
properties. Upon consolidation of GSISs ownership, Zuluetas name was cancelled and TCT
was issued in GSISs name.

Dela Merced (Petitioners predecessor) = upon learning of the foreclosure, filed a complaint
for nullity of the GSIS foreclosure on the subject properties on the ground that he, not the
Zuluetas, was the owner of these lots at the time of the foreclosure.
Dela Merced = impleaded Spouses Manalongat who were claiming lot 6 by virtue of sale
executed by GSIS in their daughters (Elizabeth Manlangot) favour. They argued that, due to
the nullity of GSISs foreclosure over the subject properties, it had no ownership right that
could be transferred to Elizabeth Manlangot. They cause annotation of lis pendens on GSIS
TCT. Thereafter, Francisco Dela Merced diedand was substituted by his heirs (instant
petitioners)

39
Trial Court = nullified GSIS foreclosure of the subject properties because these lots were
never part of its mortgage agreement with the Spouses Zulueta.
Petitioners = filed a Motion for Execution with RTC-Pasig
GSIS = opposed the motion for execution citing Section 39 RA 8291, known as GSIS Act of
1997. The said provision allegedly exempts GSIS funds and properties from attachment,
garnishment, execution, levy and other court processes.
Trial Court = granted petitioners Motion for Execution but held in abeyance the execution
of the award of attorneys fees, pending clarification before the higher courts of the issue of
GSISs exemption under Sec 39 RA 8291.
GSIS = filed with CA a petition for certiorari and prohibition against the trial courts
implementation of the writ of execution against it. Trial judge gravely abused her discretion.
CA = dismissed GSISs petition on the ground that (1) the subject properties of the writ of
execution are not properties of GSIS hence certificate of titles issued in favour of GSIS are
null and void; (2) GSIS has no interest over the subject properties and never validly acquired
ownership thereof.
GSIS = filed MR
CA = denied the MR
GSIS = appealed CAs decision before the SC
SC = denied GSIS petition.

After the issuance of the resolution, petitioners encounted more problems with the execution
because according to the Registry of Deeds of Pasig, (1) he could not enforce the decision, to
cancel the titles of GSIS, allegedly could not be enforced because the GSIS no longer had
title over these 2 lots. GSIS already conveyed these lots to Bartolome (lot 8) and Dimaguila
(Lot 7). While both titles contains notice of lis pendens carried over from GSIS title, the ROD
claimed that the writ of execution must be first modifdied to include the cancellation of
derivative titles of the GSIS title; (2) lot 10 cannot be cancelled also because no such
individual titled exist in the records. The ROD opined that he cannot cancel GSISs mother
title, even if it contains Lot 10 of Block 2 and Lot 8 of Block 8 because it would affect other
lots that might still be included therein.

Petitioners = filed before the trial court a motion for supplemental writ of execution,
ordering the ROD to cancel the titles over Lots 7 and 8 in GSISs name or other subsequent
transferees, directing GSIS and Bureau of Lands to supply ROD with technical descriptions of
Lot 10 and Lot 8.
GSIS = opposed the issuance of supplemental writ of execution.
Judge Fabros = denied the petitioners motion for supplemental writ of execution.
Respondents Arguments
1. The court only ordered the cancellation of GSISs titles over the subject properties and it
did not order to cancel all derivative titles of GSISs transferees not order GSIS to provide
ROD with technical description of the subject lots.
2. Inclusion of derivative titles would deprive the holders of these titles their day in court.
3. Decision cannot be enforced because of GSISs exemption from court processes under
RA 8291.
Petitioners arguments

40
1. The decision can be enforced against GSIS transferees pendete lite because these
transferees were given notice of the pendency of the case by virtue of the notice of lis
pendes inscribed on GSISs TCT.
2. GSIS can be compelled to provide the RD with their respective technical descriptions.
This power is granted to the courts under Section 10, Rule 39 of the Rules of Court.
3. As regards GSISs alleged exemption, petitioners posit that the GSIS can no longer raise
the issue of exemption from execution given that the CA had already rendered its Decision.
The said Decision was affirmed by this Court in G.R. No. 173391 through our February 12,
2007 Resolution and entry of judgment in that case was made on October 2, 2007

ISSUE:
WON a final and executory judgement against GSIS and Manlongat can be enforced against
their successors-in-interest or holders of derivative titles.

HELD: YES
RATIO DECIDENDI:
A notice of lis pendens is an announcement to the whole world that a particular real property
is in litigation, serving as a warning that one who acquires an interest over said property
does so at his own risk, or that he gambles on the result of the litigation over the said
property. The effect of the annotation of lis pendens on future transactions over the subject
property is discussed by an authority on land titles and registration:

Once a notice of lis pendens has been duly registered, any cancellation or issuance of the
title of the land involved as well as any subsequent transaction affecting the same, would
have to be subject to the outcome of the litigation. In other words, upon the termination of
the litigation there can be no risk of losing the property or any part thereof as a result of any
conveyance of the land or any encumbrance that may be made thereon posterior to the
filing of the notice oflis pendens.

Both titles had the notice oflis pendens which was carried over from TCT No. 23554.
Ineluctably, both Victorino and Dimaguila had notice of the litigation involving GSISs
ownership over the subject properties, and were bound by the outcome of the litigation.
When a transferee pendente lite takes property with notice of lis pendens, such transferee
undertakes to respect the outcome of the litigation. As held in Selph v. Vda. de Aguila an
order to cancel the transferors title may be enforced against his transferee, whose title is
expressly subject to the outcome of the litigation by the fact of the annotation of lis
pendens.
DOCTRINE:
A similar predicament was ruled upon by the Court in Republic Surety and Insurance Co.,
Inc. v. Intermediate Appellate Court. In that case, the Court declared that Republic Mines
had no right to the property involved but during the execution, the RD refused to cancel the
TCT in Republic Mines name on the ground that the dispositive portion of the trial courts
Decision did not order the RD to cancel the title and to revive the old title in favor of the
victorious party. The Court held that the missing order to cancel and revive should be
deemed implied in the trial courts decision.

41
When a judgment calls for the issuance of a new title in favor of the winning party (as in the
instant case), it logically follows that the judgment also requires the losing party to
surrender its title for cancellation. It is the only sensible way by which the decision may be
enforced. To this end, petitioners can obtain a court order requiring the registered owner to
surrender the same and directing the entry of a new certificate of title in petitioners favor.
The trial court should have granted petitioners motion for supplemental writ of execution as
it had authority to issue the necessary orders to aid the execution of the final judgment.

Pea vs. GSIS, Sept. 19, 2006

FACTS:
Petitioner Felisa Pea acquired three subdivision lots, covered by TCT Register of Deeds of
Cavite, from Queen's Row Subdivision, Inc., through its President Isabel Arrieta, by virtue of a
Deed of Absolute Sale, with a right to repurchase the same within two months, for the sum
of P126,000.00 plus interest.
Petitioner alleged that Queen's Row Subdivision, Inc. failed to repurchase said lots and
refused to deliver the corresponding titles of the said subdivision lots because the same
were mortgaged to herein respondent GSIS, allegedly sometime in 1971 and 1972, without
the written approval of the Housing and Land Use Regulatory Board (HLURB) as required by
PD No. 957, otherwise known as "The Subdivision and Condominium Buyers' Protective
Decree."
Petitioner: filed a Complaint for Specific Performance, Annulment of Mortgage, and Damages
before the HLURB against Queen's Row Subdivision, Inc., its President Isabel Arrieta, and
respondent, alleging that the mortgage of the subject lots to the respondent was null and
void because it had no written approval of the HLURB as required underPresidential Decree
No. 957.
Queen's Row Subdivision, Inc. and its President Isabel Arrieta: did NOT file any responsive
pleading.
Respondent: filed its Answer asserting that the subject properties had been mortgaged,
foreclosed, and transferred to its name even before the petitioner purchased the same.
HLURB: through Housing and Land Use Arbiter Cesar A. Manuel reuled in favor of petitioner.
Respondent: filed a Notice of Appeal from the afore-mentioned Decision.
HLURB Arbiter Manuel: denied the said appeal, citing Sections 22 and 23 of Resolution No. R-
537, Series of 1994, "Adopting the 1994 Rules of Procedure of the Housing and Land Use
Regulatory Board," which states that:
Section 22. Petition for Review. No motion for reconsideration of or mere Notice of
Petition from the decision shall be entertained. Within thirty (30) days from receipt of
the decision, any aggrieved party may, on any legal ground and upon payment of the
review fee, file with the Regional Office or directly with the Board of Commissioners a
petition for review. Copy of such a petition shall be furnished the other party and the
Regional Office in case the petition is directly filed with the Board of Commissioners.
Within ten (10) days from receipt of a petition or an order of elevation from the Board,
the Regional Officer shall cause the elevation of the records to the Board of
Commissioners thru the Appeals Review Group.

42
 Section 23. Contents of a Petition for Review. The petition for review shall contain
the petitioner's assignment of errors on the decision sought to be reviewed, the issues
to be resolved, the law on which it is based and the arguments in support thereof.
Petitioner: failure of respondent to file the proper mode of appeal within the reglementary
period before the HLURB hence its Decision already became final and executory.
Respondent: filed a Motion to Declare Judgment Null and Void Ab Initio before the Board of
Commissioners of the HLURB, claiming that the Regional Office of HLURB had no jurisdiction
to resolve the Complaint for it involved title to, possession of, or interest in real estate, the
jurisdiction of which belonged to the RTC; that the mortgage transaction was exempt from
the provisions of PD No. 957 because it was entered into prior to the effectivity of the said
decree.
HLURB: denied the said Motion for lack of merit and denied MR of the respondent because
the Decision of HLURB dated 20 December 1995 has already become final and executory as
early as March 1996 but granted the Ex-Parte Motion for Execution filed by petitioner.
HLURB: (upon respondents appeal) Board of Commissioners to the Office of the President
declared that:
Order appealed from being clearly erroneous, this Office is constrained to excuse the failure
of the [respondent] GSIS to file the proper Petition for Review, a mere procedural infirmity
incomparable to the injustice that is sought to be prevented hence HLURB Order SET ASIDE
and the mortgage of the subject lots to [respondent]GSIS declared VALID and SUBSISTING.
Petitioner filed a Petition for Review under Rule 43 of the 1997 Rules of Civil Procedure
before the Court of Appeals alleging that the Office of the President committed the following
grave and serious errors, to wit: (1) in not holding that the Decision of the HLURB had
become final and executory; (2) in not holding HLURB as well as the Office of the President
had no jurisdiction or authority to revive, review, change, or alter the said final and
executory and holding that the mortgage of subject lots to respondent valid and subsisting.
CA: denied the Petition for Review filed by petitioner and affirming the Decision of the Office
of the President; MR denied said Motion because there were no new or substantial reasons to
reverse or even modify the challenged Decision.
Hence, this Petition.
ISSUE:
W/N a final and executory judgment rendered by the HLURB Regional Office cannot be
revived by the filing of a Motion to Declare Judgment Null and Void Ab Initio several months
after it had become final and executory.
HELD:
In contrast, respondent, in its Memorandum, maintains that the outright dismissal of its
Notice of Appeal by the HLURB Regional Office on the ground that the filing thereof was
prohibited under the HLURB Rules, denied respondent justice inasmuch as it has meritorious
claims. Thus, the CA was correct in affirming the Decision of the Office of the President that
set aside the Order of the HLURB Board of Commissioners dated 14 July 1997 and declaring
as valid and subsisting the mortgage of the subject lots to respondent.
Noteworthy is that the right to appeal is neither a natural right nor a part of due process,
except where it is granted by statute in which case it should be exercised in the manner and
in accordance with the provisions of law. In other words, appeal is a right of statutory and
not of constitutional origin. The perfection of an appeal in the manner and within the period
prescribed by law is not only mandatory but also jurisdictional and the failure of a party to

43
conform to the rules regarding appeal will render the judgment final and executory and,
hence, unappealable, for it is more important that a case be settled than it be settled right.
Furthermore, it is axiomatic that final and executory judgments can no longer be attacked by
any of the parties or be modified, directly or indirectly, even by the highest court of the land.
Just as the losing party has the right to file an appeal within the prescribed period, so also
the winning party has the correlative right to enjoy the finality of the resolution of the case.
Under Section 22 of the 1994 Rules of Procedure of the HLURB, no Motion for
Reconsideration of or a mere Notice of Petition from the Decision shall be entertained. What
are required under said HLURB Rules are for the aggrieved party to file a Petition for Review
within 30 days from receipt of the Decision on any legal ground and upon payment of the
review fee.
In the case at bar, it must be noted that after the HLURB Regional Office rendered its 20
December 1995 Decision, respondent, instead of filing a Petition for Review within 30 days
from receipt of the said Decision which was the proper mode of appeal before the HLURB
Board of Commissioners, opted to file a mere Notice of Appeal on 30 January 1996 which
was denied in the Order of HLURB Arbiter Manuel dated 9 February 1996 because it was
prohibited by the Rules of HLURB. Consequently, for failure of the respondent to file the
proper mode of appeal within the reglementary period, the afore-mentioned Decision of the
HLURB became final and executory as early as March 1996.
It is true, as the Court of Appeals mentioned in its Decision, that rules of procedure are mere
tools designed to facilitate the attainment of justice and their strict and rigid application
which would result in technicalities that tend to frustrate rather than promote substantial
justice, must always be avoided and they cannot be blindly adhered to if they would serve
no other purpose than to put into oblivion the very lis mota of the controversy under
scrutiny. However, there are certain procedural rules that must remain inviolable like those
setting the periods for perfecting an appeal or filing a Petition for Review, for it is doctrinally
entrenched that the right to appeal is a statutory right and one who seeks to avail of that
right must comply with the statute or rules. These rules, particularly the requirements for
perfecting an appeal within the reglementary period specified in the law, must be strictly
followed as they are considered indispensable interdictions against needless delays and for
orderly discharge of judicial business. 30
The Notice of Appeal filed by the respondent cannot equate to the Petition for Review
required by the HLURB Rules. The Notice of Appeal filed by the respondent merely states
that:
Respondent Government Service Insurance System (GSIS) thru counsel, unto this
Honorable Office most respectfully gives notice that it is appealing the Decision
dated 20 December 1995 of HLURB Arbiter, Hon. Cesar A. Manuel to the Housing
and Land Use Regulatory Board on both questions of law and fact. HDaACI
Pasay City for Quezon City, January 30, 1996.
whereas, the Petition for Review under Section 23 of the 1994 HLURB Rules must contain
the petitioner's assignment of errors on the decision sought to be reviewed, the issues to
be resolved, the law on which it is based and the arguments in support thereof. There is
a wide difference between Notice of Appeal and a Petition for Review in terms of
substance that the relaxation of the rigid rules of procedure cannot be permitted.
Furthermore, it was highly improbable for the respondent to be so unmindful of the HLURB
Rules of Procedure regarding the proper mode of appeal. Additionally, it must be noted that
when respondent filed its Notice of Appeal, it did not even state the reason why instead of
filing a Petition for Review it filed a Notice of Appeal. Hence, HLURB Arbiter Manuel of the
Regional Office cannot be faulted when he denied respondent's Notice of Appeal as it was
prohibited under the HLURB Rules. Also, there is nothing to prevent the 20 December 1995

44
Decision of the HLURB Arbiter Manuel from becoming final and executory since respondent
failed to perfect its appeal in the manner and within the period provided for in the HLURB
Rules. Where a party does not institute the correct mode of appeal such as a Petition for
Review instead of a mere Notice of Appeal, he loses it.
Since the 20 December 1995 Decision of HLURB Regional Office was already final and
executory, no court, not even the highest court of the land, can revive, review, change or
alter the same. It is already well settled in our jurisdiction that the decisions and orders of
administrative agencies rendered pursuant to their quasi-judicial authority, have, upon their
finality, the force and binding effect of a final judgment within the purview of the doctrine of
res judicata. The rule of res judicata, which forbids the reopening of a matter once judicially
determined by competent authority, applies as well to the judicial and quasi-judicial acts of
public, executive, or administrative officers and boards acting within their jurisdiction. 33
In view of the foregoing, the Motion to Declare Judgment Null and Void Ab Initio filed by
respondent on 25 September 1996, or after so many months from the finality of the Decision
it seeks to be declared null and void, can no longer be entertained by the HLURB Board of
Commissioners. The same was just an attempt to reinstate an appeal that had already been
lost. Even granting arguendo that the said Motion was proper, still, the allegation therein of
the respondent that the HLURB Regional Office had no jurisdiction over the case because it
involved title to, possession of, or interest in real estate, the jurisdiction of which supposedly
belonged to the Regional Trial Court, was not sufficient to warrant the declaration of the
Decision of the HLURB as null and void. Such ground relied upon by the respondent is
untenable because the jurisdiction involving unsound real estate practices and other matters
in connection thereto belongs to HLURB.
It must be remembered that Presidential Decre No. 1344 of 2 April 1978 expanded the
jurisdiction of the National Housing Authority (NHA) to include the following:
Section 1. In the exercise of its functions to regulate the real estate trade and business and
in addition to its powers provided for in Presidential Decree No. 957, the National Housing
Authority shall have exclusive jurisdiction to hear and decide cases of the following nature:
A. Unsound real estate business practices;
B. Claims involving refund and any other claims filed by subdivision lot or condominium
unit buyer against the project owner, developer, dealer, broker, or salesman; and
C. Cases involving specific performance of contractual and statutory obligations filed by
buyers of subdivision lot or condominium unit against the owner, developer, dealer, broker
or salesman.
On 7 February 1981, Executive Order No. 648 transferred the regulatory and quasi-judicial
functions of the NHA to Human Settlements Regulatory Commission.
Section 8. TRANSFER OF FUNCTIONS. The regulatory functions of the National Housing
Authority pursuant to Presidential Decrees No. 957, 1216, 1344 and other related laws are
hereby transferred to the Commission, together with such applicable personnel,
appropriation, records, equipment and property necessary for the enforcement and
implementation of such functions. Among these regulatory functions are:
1. Regulation of the real estate trade and business;
2. Registration of subdivision lots and condominium projects;
3. Issuance of license to sell subdivision lots and condominium units in the registered
units; aDIHCT
4. Approval of performance bond and the suspension of license to sell;

45
 5. Registration of dealers, brokers, and salesmen engaged in the business of selling
subdivision lots or condominium units;
6. Revocation of registration of dealers, brokers and salesmen;
7. Approval of mortgage on any subdivision lot or condominium unit made by the owner or
developer;
8. Granting of permits for the alteration of plans and the extension of period for completion
of subdivision or condominium projects;
9. Approval of the conversion to other purposes of roads and open spaces found within the
project which have been donated to the city or municipality concerned;
10. Regulation of the relationship between lessors and lessees; and
11. Hear and decide cases on unsound real estate business practices; claims involving
refund filed against project owners, developers, dealers, brokers or salesmen and cases of
specific performance.

EO No. 90 dated 17 December 1986 changed the name of the Human Settlements
Regulatory Commission to Housing and Land Use Regulatory Board (HLURB).
When an administrative agency or body is conferred quasi-judicial functions, all
controversies relating to the subject matter pertaining to its specialization are deemed to be
included within the jurisdiction of said administrative agency or body. Split jurisdiction is not
favored. Therefore, the Complaint for Specific Performance, Annulment of Mortgage, and
Damages filed by petitioner against respondent, though involving title to, possession of, or
interest in real estate, was well within the jurisdiction of the HLURB for it involves a claim
against the subdivision developer, Queen's Row Subdivision, Inc., as well as respondent.
Attention should also be called to the fact that respondent failed to act promptly to protect
its rights after HLURB Arbiter Manuel denied its Notice of Appeal. It did not even offer an
explanation why it took many months before it filed its Motion to Declare Judgment Null and
Void Ab Initio with the HLURB Board of Commissioners. For such inaction of the respondent
for a long period of time, the 20 December 1995 Decision of the HLURB Regional Office
became final and executory and that was the price respondent had to pay for its delayed
reaction.
Thus, when the Office of the President acted upon the appeal of the respondent and thereby
reversing the final and executory Decision of the HLURB Regional Office, it acted without
jurisdiction. It bears stressing that after the Decision of the HLURB Regional Office had
become final and executory as early as March 1996, even the Office of the President had no
more jurisdiction to revive, review, change or alter the same. Such final resolution or
decision of an administrative agency also binds the Office of the President even if such
agency is under the administrative supervision and control of the latter.
In sum, the Decision of the HLURB Regional Office dated 20 December 1995 had become
final and executory for failure of respondent to perfect an appeal within the reglementary
period in the manner provided for in the HLURB Rules. Hence, the said Decision became
immutable; it can no longer be amended nor altered by the Office of the President.
Accordingly, inasmuch as the timely perfection of an appeal is a jurisdictional requisite, the
Office of the President had no more authority to entertain the appeal of the respondent.
Otherwise, any amendment or alteration made which substantially affects the final and
executory judgment would be null and void for lack of jurisdiction.
This Court had stated before that administrative decisions must end sometime, as fully as
public policy demands that finality be written on judicial controversies. Public interest
requires that proceedings already terminated should not be altered at every step, for the

46
rule of non quieta movere prescribes that what had already been terminated should not be
disturbed. A disregard of this principle does not commend itself to sound public policy.
The orderly administration of justice requires that the judgments/resolutions of a court or
quasi-judicial body must reach a point of finality set by the law, rules, and regulations. The
noble purpose is to write finis to dispute once and for all. This is a fundamental principle in
our justice system, without which there would be no end to litigations. Utmost respect and
adherence to this principle must always be maintained by those who exercise the power of
adjudication. Any act, which violates such principle, must immediately be struck down.
Indeed, the principle of conclusiveness of prior adjudications is not confined in its operation
to the judgments of what are ordinarily known as courts, but it extends to all bodies upon
which judicial powers had been conferred.
As a final point. Having said that the Decision of the HLURB Regional Office dated 20
December 1995 had become final and executory, it was, therefore, a reversible error on the
part of the Court of Appeals to affirm the Decision of the Office of the President reversing the
HLURB Regional Office, because such Decision was rendered by the Office of the President
without jurisdiction. Hence, when the Court of Appeals affirmed the Decision of the Office of
the President, it likewise acted without jurisdiction.
Petition is hereby GRANTED. Both the CA and President have no more jurisdictions to review
much more to reverse the 20 December 1995 Decision of the HLURB Regional Office, as it
was already final and executory.
DOCTRINE:
Well-settled is the rule that once a judgment has become final and executory, no
court, not even this Court, has the power to revive, review, change or alter the
same.
The rule on finality of decisions, orders or resolutions of a judicial, quasi-judicial
or administrative body is "not a question of technicality but of substance and
merit," the underlying consideration therefore, being the protection of the
substantive rights of the winning party. Nothing is more settled in law than that a
decision that has acquired finality becomes immutable and unalterable and may
no longer be modified in any respect even if the modification is meant to correct
erroneous conclusions of fact or law and whether it will be made by the court that
rendered it or by the highest court of the land.
The reason for this is that litigation must end and terminate sometime and
somewhere, and it is essential to an effective and efficient administration of
justice that once a judgment has become final, the winning party be not deprived
of the fruits of the verdict. Court must guard against any scheme calculated to
bring about that result and must frown upon any attempt to prolong the
controversies. The only exceptions to the general rule are the correction of
clerical errors, the so-called nunc pro tuncentries which cause no prejudice to any
party, void judgments, and whenever circumstances transpire after the finality of
the decision rendering its execution unjust and inequitable.

3. Rules 37 and 38 (New Trial or Reconsideration/Relief from Judgments, Orders,

or Other Proceedings)

Neypes vs. CA, 469 SCRA 633

47
FACTS:
Petitioners Domingo Neypes, Luz Faustino, Rogelio Faustino, Lolito Victoriano, Jacob Obania
and Domingo Cabacungan filed an action for annulment of judgment and titles of land
and/or reconveyance and/or reversion with preliminary injunction before RTC Oriental
Mindoro, against the Bureau of Forest Development, Bureau of Lands, Land Bank of the
Philippines and the heirs of Bernardo del Mundo, namely, Fe, Corazon, Josefa, Salvador and
Carmen.
Both petitioners and respondents: filed various motions with the trial court
(1) the motion filed by petitioners to declare the respondent heirs, the Bureau of Lands and
the Bureau of Forest Development in default and
(2) the motions to dismiss filed by the respondent heirs and the Land Bank of the
Philippines, respectively.
TC: presided by public respondent Judge Antonio N. Rosales, resolved the foregoing motions
as follows: (1) the petitioners' motion to declare respondents Bureau of Lands and Bureau of
Forest Development in default was granted for their failure to file an answer, but denied as
against the respondent heirs of del Mundo because the substituted service of summons on
them was improper;
(2) the Land Bank's motion to dismiss for lack of cause of action was denied because there
were hypothetical admissions and matters that could be determined only after trial, and
(3) the motion to dismiss filed by respondent heirsof del Mundo, based on prescription, was
also denied because there were factual matters that could be determined only after trial. 1
Respondent heirs: filed MR of the order denying their MTD on the ground that the TC could
very well resolve the issue of prescription from the bare allegations of the complaint itself
without waiting for the trial proper.
TC: dated February 12, 1998, dismissed petitioners' complaint on the ground that the action
had already prescribed. Petitioners allegedly received a copy of the order of dismissal on
March 3, 1998 and, on the 15th day thereafter or on March 18, 1998, filed MR; On July 1,
1998, TC issued another order dismissing the MR which petitioners received on July 22,
1998. Five days later, on July 27, 1998, petitioners filed a notice of appeal and paid the
appeal fees on August 3, 1998. CTEaDc
Court a quo: On August 4, 1998, denied the notice of appeal, holding that it was filed eight
days late. This was received by petitioners on July 31, 1998. Petitioners filed MR but this too
was denied in an order dated September 3, 1998.
Petitioners: Via a petition for certiorari and mandamus under Rule 65 of the 1997 Rules of
Civil Procedure, assailed the dismissal of the notice of appeal before CA
Petitioners claim: that they had seasonably filed their notice of appeal arguing that the 15-
day reglementary period to appeal started to run only on July 22, 1998 since this was the
day they received the final order of the trial court denying their MR; When they filed their
notice of appeal on July 27, 1998, only five days had elapsed and they were well within the
reglementary period for appeal.
CA: On September 16, 1999, dismissed the petition ruling that the 15-day period to appeal
should have been reckoned from March 3, 1998 or the day they received the February 12,
1998 order dismissing their complaint. According to the appellate court, the order was the
"final order" appealable under the Rules. It held further that petitioners' tardy appeal was
correctly dismissed for the perfection of an appeal within the reglementary period and in the

48
manner prescribed by law is jurisdictional and non-compliance with such legal requirement
is fatal and effectively renders the judgment final and executory
Petitioners: filed MR of the aforementioned decision.
CA: denied on January 6, 2000.
Hence this petition for review under Rule 45 of the Rules.
ISSUE:
Period within which petitioners should have filed their notice of appeal.
HELD:ESAIT
Right to appeal is neither a natural right nor a part of due process. It is merely a statutory
privilege and may be exercised only in the manner and in accordance with the provisions of
law. Thus, one who seeks to avail of the right to appeal must comply with the requirements
of the Rules. Failure to do so often leads to the loss of the right to appeal. The period to
appeal is fixed by both statute and procedural rules. BP 129, as amended, provides:
Sec. 39. Appeals. The period for appeal from final orders, resolutions, awards,
judgments, or decisions of any court in all these cases shall be fifteen (15) days
counted from the notice of the final order, resolution, award, judgment, or decision
appealed from. Provided, however, that in habeas corpus cases, the period for
appeal shall be (48) forty-eight hours from the notice of judgment appealed from. . .
.
Rule 41, Section 3 of the 1997 Rules of Civil Procedure states:
SEC. 3. Period of ordinary appeal. The appeal shall be taken within fifteen (15)
days from the notice of the judgment or final order appealed from. Where a record
on appeal is required, the appellant shall file a notice of appeal and a record on
appeal within thirty (30) days from the notice of judgment or final order.
The period to appeal shall be interrupted by a timely motion for new trial or
reconsideration. No motion for extension of time to file a motion for new trial or
reconsideration shall be allowed. (emphasis supplied)
Based on the foregoing, an appeal should be taken within 15 days from the notice of
judgment or final order appealed from. A final judgment or order is one that finally disposes
of a case, leaving nothing more for the court to do with respect to it. It is an adjudication on
the merits which, considering the evidence presented at the trial, declares categorically
what the rights and obligations of the parties are; or it may be an order or judgment that
dismisses an action.
We thus hold that petitioners seasonably filed their notice of appeal within the fresh period
of 15 days, counted from July 22, 1998 (the date of receipt of notice denying their motion for
reconsideration). This pronouncement is not inconsistent with Rule 41, Section 3 of the Rules
which states that the appeal shall be taken within 15 days from notice of judgment or final
order appealed from. The use of the disjunctive word "or" signifies disassociation and
independence of one thing from another. It should, as a rule, be construed in the sense in
which it ordinarily implies. Hence, the use of "or" in the above provision supposes that the
notice of appeal may be filed within 15 days from the notice of judgment or within 15 days
from notice of the "final order," which we already determined to refer to the July 1, 1998
order denying the motion for a new trial or reconsideration.
Neither does this new rule run counter to the spirit of Section 39 of BP 129 which shortened
the appeal period from 30 days to 15 days to hasten the disposition of cases. The original
period of appeal (in this case March 3-18, 1998) remains and the requirement for strict

49
compliance still applies. The fresh period of 15 days becomes significant only when a party
opts to file a motion for new trial or motion for reconsideration. In this manner, the trial
court which rendered the assailed decision is given another opportunity to review the case
and, in the process, minimize and/or rectify any error of judgment. While we aim to resolve
cases with dispatch and to have judgments of courts become final at some definite time, we
likewise aspire to deliver justice fairly.
In this case, the new period of 15 days eradicates the confusion as to when the 15-day
appeal period should be counted from receipt of notice of judgment (March 3, 1998) or
from receipt of notice of "final order" appealed from (July 22, 1998).
To recapitulate, a party litigant may either file his notice of appeal within 15 days from
receipt of the Regional Trial Court's decision or file it within 15 days from receiptof the order
(the "final order") denying his motion for new trial or motion for reconsideration. Obviously,
the new 15-day period may be availed of only if either motion is filed; otherwise, the
decision becomes final and executory after the lapse of the original appeal period provided
in Rule 41, Section 3.
Petitioners here filed their notice of appeal on July 27, 1998 or five days from receipt of the
order denying their motion for reconsideration on July 22, 1998. Hence, the notice of appeal
was well within the fresh appeal period of 15 days, as already discussed.
Petition GRANTED and CA decision REVERSED and SET ASIDE.
Other important details:
PERIOD TO APPEAL; ORDER OR JUDGMENT WHEN DEEMED FINAL. An appeal should be
taken within 15 days from the notice of judgment or final order appealed from. A final
judgment or order is one that finally disposes of a case, leaving nothing more for the court to
do with respect to it. It is an adjudication on the merits which, considering the evidence
presented at the trial, declares categorically what the rights and obligations of the parties
are; or it may be an order or judgment that dismisses an action.
ORDER DENYING THE PARTIES' MOTION FOR RECONSIDERATION CONSTITUTES THE FINAL
ORDER WHICH FINALLY DISPOSED OF THE ISSUES INVOLVED IN A CASE; CASE AT BAR. In
the recent case of Quelnan v. VHF Philippines, Inc., the trial court declared petitioner
Quelnan non-suited and accordingly dismissed his complaint. Upon receipt of the order of
dismissal, he filed an omnibus motion to set it aside. When the omnibus motion was filed, 12
days of the 15-day period to appeal the order had lapsed. He later on received another
order, this time dismissing his omnibus motion. He then filed his notice of appeal. But this
was likewise dismissed for having been filed out of time. The court a quo ruled that
petitioner should have appealed within 15 days after the dismissal of his complaint since this
was the final order that was appealable under the Rules. We reversed the trial court and
declared that it was the denial of the motion for reconsideration ofan order of dismissal of a
complaint which constituted the final order as it was what ended the issues raised there.
This pronouncement was reiterated in the more recent case of Apuyan v. Haldeman, et al.
where we again considered the order denying petitioner Apuyan's motion for reconsideration
as the final order which finally disposed of the issues involved in the case. Based on the
aforementioned cases, we sustain petitioners' view that the order dated July 1, 1998 denying
their motion for reconsideration was the final order contemplated in the Rules.
RULE; DELAY IN THE FILING OF AN APPEAL; WHEN MAY BE EXCUSED. In National
Waterworks and Sewerage Authority and Authority v. Municipality of Libmanan, however, we
declared that appeal is an essential part of our judicial system and the rules of procedure
should not be applied rigidly. ThisCourt has on occasion advised the lower courts to be
cautious about not depriving a party of the right to appeal and that every party litigant
should be afforded the amplest opportunity for the proper and just disposition of his cause,
free from the constraint of technicalities. In de la Rosa v. Court of Appeals, we stated that, as

50
a rule, periods which require litigants to do certain acts must be followed unless, under
exceptional circumstances, a delay in the filing of an appeal may be excused on grounds of
substantial justice. There, we condoned the delay incurred by the appealing party due to
strong considerations of fairness and justice. In setting aside technical infirmities and
thereby giving due course to tardy appeals, we have not been oblivious to or unmindful of
the extraordinary situations that merit liberal application of the Rules. In those situations
where technicalities were dispensed with, our decisions were not meant to undermine the
force and effectivity of the periods set by law. But we hasten to add that in those rare cases
where procedural rules were not stringently applied, there always existed a clear need to
prevent the commission of a grave injustice. Our judicial system and the courts have always
tried to maintain a healthy balance between the strict enforcement of procedural laws and
the guarantee that every litigant be given the full opportunity for the just and proper
disposition of his cause.
15-DAY APPEAL PERIOD COUNTED FROM RECEIPT OF NOTICE OF JUDGMENT OR FROM
RECEIPT OF NOTICE OF FINAL ORDER APPEALED FROM. We thus hold that petitioners
seasonably filed their notice of appeal within the fresh period of 15 days, counted from July
22, 1998 (the date of receipt of notice denying their motion for reconsideration). This
pronouncement is not inconsistent with Rule 41, Section 3 of the Rules which states that the
appeal shall be taken within 15 days from notice of judgment or final order appealed from.
The use of the disjunctive word "or" signifies disassociation and independence of one thing
from another. It should, as a rule, be construed in the sense in which it ordinarily implies.
Hence, the use of "or" in the above provision supposes that the notice of appeal may be filed
within 15 days from the notice of judgment or within 15 days from notice of the "final order,"
which we already determined to refer to the July 1, 1998 order denying the motion for a new
trial or reconsideration. Neither does this new rule run counter to the spirit of Section 39 of
BP 129 which shortened the appeal period from 30 days to 15 days to hasten the disposition
of cases. The original period of appeal (in this case March 3-18, 1998) remains and the
requirement for strict compliance still applies. The fresh period of 15 days becomes
significant only when a party opts to file a motion for new trial or motion for reconsideration.
In this manner, the trial court which rendered the assailed decision is given another
opportunity to review the case and, in the process, minimize and/or rectify any error
ofjudgment. While we aim to resolve cases with dispatch and to have judgments of courts
become final at some definite time, we likewise aspire to deliver justice fairly. In this case,
the new period of 15 days eradicates the confusion as to when the 15-day appeal period
should be counted from receipt of notice of judgment (March 3, 1998) or from receipt of
notice of "final order" appealed from (July 22, 1998).
NEW 15-DAY PERIOD MAY BE AVAILED OF ONLY WHEN EITHER A MOTION FOR NEW TRIAL OR
MOTION FOR RECONSIDERATION IS FILED; CASE AT BAR. To recapitulate, a party litigant
may either file his notice of appeal within 15 days from receipt of the Regional Trial Court's
decision or file it within 15 days from receipt of the order (the "final order") denying his
motion for new trial or motion for reconsideration. Obviously, the new 15-day period may be
availed ofonly if either motion is filed; otherwise, the decision becomes final and executory
after the lapse of the original appeal period provided in Rule 41, Section 3. Petitioners here
filed their notice of appeal on July 27, 1998 or five days from receipt of the order denying
their motion for reconsideration on July 22, 1998. Hence, the notice ofappeal was well within
the fresh appeal period of 15 days, as already discussed.
DOCTRINE:
FRESH PERIOD RULE. The Supreme Court may promulgate procedural rules in
all courts. It has the sole prerogative to amend, repeal or even establish new
rules for a more simplified and inexpensive process, and the speedy disposition of
cases. In the rules governing appeals to it and to the Court of Appeals,
particularly Rules 42, 43 and 45, the Court allows extensions of time, based on

51
justifiable and compelling reasons, for parties to file their appeals. These
extensions may consist of 15 days or more. To standardize the appeal periods
provided in the Rules and to afford litigants fair opportunity to appeal their cases,
the Court deems it practical to allow a fresh period of 15 days within which to file
the notice of appeal in the Regional Trial Court, counted from receipt of the order
dismissing a motion for a new trial or motion for reconsideration. Henceforth, this
"fresh period rule" shall also apply to Rule 40 governing appeals from the
Municipal Trial Courts to the Regional Trial Courts; Rule 42 on petitions for review
from the Regional Trial Courts to the Court of Appeals; Rule 43 on appeals from
quasi-judicial agencies to the Courtof Appeals and Rule 45 governing appeals by
certiorari to the Supreme Court. The new rule aims to regiment or make the
appeal period uniform, to be counted from receipt of the order denying the
motion for new trial, motion for reconsideration (whether full or partial) or any
final order or resolution.

Cansino vs. CA, 409 SCRA 403

PUNO, J.:

Facts:

Having gone through the summary procedure in the Metropolitan Trial Court
(MeTC), an appeal to the Regional Trial Court (RTC) and a petition for certiorari to
the Court of Appeals (CA), this ejectment case is now before this Court on a
Petition for Review on Certiorari.
The case stemmed from a complaint for unlawful detainer filed by respondent
spouses Francisco and Rosario Castro against Danilo Cansino, Linda de Jesus and
Elena Mesa[1] before the Metropolitan Trial Court. The subject matter of the
controversy is a parcel of land located at Maligaya Park Subdivision, Kalookan
City. In their complaint, respondents alleged that petitioners, by strategy and
stealth unlawfully constructed their respective houses inside plaintiffs() (herein
respondents) aforementioned parcel of land.[2] In their answer with counterclaim,
petitioners Cansino and de Jesus averred that their possession was premised
upon the honest belief that the lot they were and are still occupying was a public
land; that they had been in possession of the subject premises ever since 1977;
and that the failure (of herein respondents) to allege when possession of
defendants (herein petitioners) started and taken cognizance of by plaintiffs
(herein respondents) created (sic) doubts as to the jurisdiction of the MeTC.

MTC Ruling:

MeTC took cognizance of the case and treated the complaint as one for ejectment
under the Rules on Summary Procedure. It ordered the parties to submit their
respective affidavits and those of their witnesses along with their other evidence.
Thereafter, the MeTC in its decision dated August 12, 1994, dismissed the
complaint holding that in an ejectment case, the plaintiff has the burden of
proving prior physical possession of the property. Respondents failed to discharge
the burden.

RTC Ruling:

On appeal with the RTC of Kalookan City, Br. 120, the court, on January 11, 1995,

52
affirmed in toto the decision of the MeTC. It held that respondents were not able
to present evidence of their actual possession of the property prior to that of
petitioners, while the latter were able to prove their possession of the property
since 1977.

Respondents filed a motion for reconsideration where they appended more

documentary evidence showing their ownership over the subject property, as well
as the ownership and possession of their predecessors-in-interest. On March 14,
1995, the RTC reversed its previous decision. It ruled that respondents were able
to prove the ownership and possession of their predecessors-in-interest, which
dated back to 1964, way before the 1977 possession of petitioners. Moreover, it
rejected the claim of petitioners that the subject land is public property since it
has been proven that the lot is titled and the title has been transferred to
respondents on January 29, 1993. The title being incontrovertible after a year,
petitioners can no longer assail it. The court considered petitioners as intruders
or squatters on the subject lot.

CA Ruling:

They assailed the right of the RTC to decide the issue of ownership without any
fair trial and the propriety of the action of the RTC in considering the
documentary evidence attached by respondents in their motion for
reconsideration which were not made part of the position paper they
(respondents) previously submitted.

Court of Appeals affirmed the ruling of the RTC. It held that petitioners were
unable to substantiate their possession of the property. Their occupancy is at
best due to the tolerance of the registered owners, private respondent spouses.
Moreover, since respondents had prior legal possession of the property, they had
in their favor priority of time that legally entitles them to stay in the said
property. With regard to the action taken by the RTC in considering the
documentary evidence attached only in the motion for reconsideration, the
appellate court ruled that under Section 5, Rule 135 of the Revised Rules of Court,
the RTC has the inherent power to amend and control its process and orders so as
to make them conformable to law and justice.

Petitioners brought the case at bar to this Court on a petition for review on
certiorari.

Issue:

WHETHER OR NOT SECTION 5, RULE 135 OF THE REVISED RULES OF COURT IS

APPLICABLE IN A MOTION FOR RECONSIDERATION WHERE DOCUMENTS IN THE
MOTION FOR RECONSIDERATION ARE NOT TO BE CONSIDERED AS EVIDENCE TO
PROVE SUPERVENING EVENTS.

Held:

No. The Court of Appeals upheld the RTC in reconsidering its prior decision on the
basis of new evidence attached to the motion for reconsideration on the ground
that it is the inherent right of the court to amend and control its processes. It
further ruled that procedural technicalities should not override substantial
justice.

We disagree. It is true that the rules provide that courts have the inherent power

53
to amend their decisions to make them conformable to law and justice. This
prerogative, however, is not absolute. The rules do not contemplate amendments
that are substantial in nature. They merely cover formal changes or such that will
not affect the crux of the decision, like the correction of typographical or clerical
errors. Courts will violate due process if they make substantial amendments in
their decisions without affording the other party the right to contest the new
evidence presented in a motion for reconsideration.

Doctrine:
Under Rule 37 of the Revised Rules of Court, a party may file a motion for
reconsideration on the ground, among others, that x x x, the evidence is
insufficient to justify the decision or final order, or the decision or final order is
contrary to law. It requires the motion to point out specifically the findings or
conclusions of the judgment or final order which are not supported by the
evidence or which are contrary to law, making specific reference to the
testimonial or documentary evidence presented or to the provisions of law
alleged to be violated.
It is implicitly clear from Rule 37 that a motion for reconsideration cannot be used
as a vehicle to introduce new evidence. Petitioners correctly contend that if
respondents wanted to present further evidence, they should have filed a motion
for new trial based on newly discovered evidence. However, for newly discovered
evidence to warrant a new trial, (a) it must have been discovered after trial, (b) it
could not have been discovered or produced at the trial despite reasonable
diligence, (c) it must be material and not merely collateral, cumulative,
corroborative or purely for impeaching a witness, merely important evidence
being not enough, and (d) if presented, would probably alter the result of the
action.

Uy vs. First Metro Integrated Steel, September 27, 2006

ELPIDIO S. UY, petitioner, vs. FIRST METRO INTEGRATED STEEL CORP. and HON.
ANTONIO I. DE CASTRO, in his capacity as Presiding Judge, Regional Trial Court,
National Capital Judicial Region, Branch 3, Manila, respondents
G.R. No. 167245. September 27, 2006
YNARES-SANTIAGO, J

FACTS:
On July 5, 1999, private respondent First Metro Integrated Steel Corporation (FMISC) filed a
complaint for sum of money with prayer for writ of preliminary attachment against Robert
Juan Uy (Robert), Midland Integrated Construction Company (MICC) and herein petitioner
Elpidio Uy, with the Regional Trial Court of Manila. It is alleged that on June 3, 5 and 6, 1998,
FMISC delivered to MICC, Robert and petitioner deformed steel bars valued at P695,811.00.
On June 9, 1998, Robert allegedly delivered to FMISC Metrobank Check No. 042892 in the
amount of P695,811.00 issued by petitioner as payment. However, the check was
dishonored upon presentment and despite demands, MICC, Robert and petitioner refused to
pay, hence the complaint.

In their Answer with Counterclaim and Crossclaim, Robert and MICC alleged that they are
strangers to the contract between FMISC and petitioner; that Robert merely referred
petitioner to FMISC; that petitioner left his check in Robert's office which was picked up by

54
FMISC's collector; and that the deformed steel bars were delivered to and received by
petitioner's representatives
Petitioner filed his Answer with Counterclaim 5 claiming that he had no business transaction
with FMISC that he issued the check in favor of FMISC in the amount of P695,811,00 but
since it was not intended as payment to FMISC, he stopped the payment thereof.
Hearings were thereafter conducted for the reception of evidence of FMISC, Robert and
MICCs, reception of petitioner's evidence February 28, 2001 6 but it was cancelled because
petitioner had influenza. The hearing was reset to April 26, 2001 and May 10, 2001 7 but
was again cancelled and moved to October 25, 2001 and December 13, 2001.
During the October 25, 2001 hearing, petitioner was represented by Atty. Lucas C. Carpio, Jr.
who appeared as Atty. Molina's collaborating counsel. 8 The hearing was cancelled and
rescheduled to December 13, 2001. However, on December 10, 2001, Atty. Molina withdrew
his appearance as petitioner's counsel with the latter's consent. 9 On December 13, 2001,
Atty. Danilo Baares entered his appearance and requested for a resetting on February 14
and 28, 2002 10 which was granted by the trial court. On February 14, 2002, Atty. Baares
appeared but instead of presenting evidence for the petitioner, he requested for a
postponement and resetting of the hearing. 11
ISSUE:
W/N the motion for new trial should be granted
HELD:
Motion for New Trial was received by the trial court on April 28, 2003, the date on the
Registry Receipt attached to the Affidavit of Service 21 as well as that stamped on the
envelope 22 which contained the copy of the motion, reveals that it was filed and served by
registered mail on April 21, 2003, a Monday, because April 19, 2003, the last day for filing
the same was a Saturday. Section 1, Rule 22 of the Rules of Court states in no uncertain
terms that if the last day of the period thus computed falls on a Saturday, a Sunday, or a
legal holiday in the place where the court sits, the time shall not run until the next working
day. Thus, the motion was actually filed on time it having been filed on April21, 2003,the
next working day, following the last day for filing which fell on a Saturday.
Section 9, Rule 37 of the Rules of Court which provides that the remedy to an order denying
a motion for new trial is to appeal the judgment or final order, must be read in conjunction
with Section 1, Rule 41 which provides that:
SEC. 1. Subject of appeal. An appeal may be taken from a judgment or final order
that completely disposes of the case, or of a particular matter therein when
declared by these rules to be appealable.
No appeal may be taken from:
(a) An order denying a motion for new trial or reconsideration;
In all the above instances where the judgment or final order is not appeasable, the
aggrieved party may file an appropriate special civil action under Rule 65.
(Emphasis supplied)
Thus, the filing by the petitioner of a petition for certiorari with the Court of Appeals from the
denial of the motion for new trial by the trial court is proper.
Section 1, Rule 37 provides that a motion for new trial may be filed within the period for
taking an appeal based on the following grounds:

55
 (a) Fraud, accident, mistake or excusable negligence which ordinary prudence could
not have guarded against and by reason of which such aggrieved party has
probably been impaired in his rights; or
xxx xxx xxx
Negligence to be excusable must be one which ordinary diligence and prudence could not
have guarded against. 23
In the instant case, we find the negligence of petitioner's counsel in failing to attend the
hearings for the reception of evidence inexcusable. The trial court scheduled the hearing for
the reception of petitioner's evidence seven times. Scrutiny of the records disclose that the
hearings were postponed or cancelled without any justification. However, the trial court
accommodated the requests for postponement or resetting in order to accord petitioner due
process. we find petitioner's counsel's failure to attend the seven scheduled hearings
without justifiable reason tantamount to inexcusable neglect. As such, it cannot be a ground
for new trial.
the moving party must show that he has a meritorious defense. The facts constituting the
movant's good and substantial defense, which he may prove if the petition were granted,
must be shown in the affidavit which should accompany the motion for a new trial. 25 We
examined petitioner's Affidavit of Merit and find that it did not contain clear statements of
the facts constituting a good and valid defense which he might prove if given the chance to
introduce evidence. The allegations that he has a "meritorious defense" 26 and a "good
cause"
An affidavit of merit should state facts, and not mere opinion or conclusions of law
Petitioner's motion for new trial and affidavit of merit did not mention the evidence which he
was prevented from introducing, nor did it allege that such evidence would change the
outcome of the case.
Petitioner's argument that his counsel's negligence was so gross that he was deprived of due
process fails to impress. petitioner's and his counsel's negligence are concurrent. During the
initial hearing for the reception of his evidence, petitioner was absent allegedly due to
influenza petitioner's counsel's inexcusable neglect did not amount to petitioner's
deprivation of due process of law. The right to due process safeguards the opportunity to be
heard and to submit any evidence one may have in support of his claim or defense. Blunders
and mistakes in the conduct of the proceedings in the trial court as a result of the ignorance,
inexperience or incompetence of counsel do not qualify as a ground for new trial. If such
were to be admitted as valid reasons for re-opening cases, there would never be an end to
litigation so long as a new counsel could be employed to allege and show that the prior
counsel had not been sufficiently diligent, experienced or learned.

Purcon, Jr. vs. MRM Philippines, Inc et al, G.R. No. 182718, September 26, 2008

FACTS:
Petitioner Julio Purcon alleged that respondent MRM Philippines, Inc. hired him as a seaman
on board the vessel M/T SARABELLE; that he signed a contract for 3 months; his work
involved a day-to-day activity that required exertion of strenuous effort, and he often worked
overtime due to the pressure of his work. Petitioners contract was extended for another 3
months. On the second week of June 2002, he felt an excruciating pain in his left testicle.

56
After being examined by a doctor at the port of France, he was diagnosed with hernia, which
caused his repatriation due to his ailment.

Upon petitioner's return to the Philippines, he was examined by Dr. Alegre, the company
physician, who prescribed certain medication and afterwards declared that he was fit to
resume work. When he reported to MRM Philippines, Inc. hoping to be re-hired for another
contract, he was told that there was no vacancy for him.

Petitioner filed a complaint for reimbursement of medical expenses, sickness allowance and
permanent disability benefits with prayer for compensatory, moral and exemplary damages
and attorney's fees before the Arbitration Branch of the NLRC.

Respondent MRM Philippines countered that since petitioner's ailment, hernia, is not work-
related, he is not entitled to disability benefit and related claims. In fact, he was declared fit
to resume work by the company-designated physician; that his ailment is not to be
considered a permanent disability as this is easily correctable by simple surgery. More
importantly, petitioner signed a Quitclaim and Release which was notarized.

Labor Arbiter: DISMISSED the complaint for utter lack of merit; as petitioner was fit to
resume work as a seafarer as his "hernia" was already cured or non-existent, that petitioner
was in fact ready to resume work. Unfortunately, he was not accommodated due to lack of
vacancy. The fact that he was not re-hired by respondent did not mean that he was suffering
from disability.

NLRC: petitioner filed a Memorandum of Appeal, however, NLRC AFFIRMED the Labor
Arbiters decision.

CA: petitioner filed a Petition for Certiorari under Rule 65, however it was DISMISSED due to
formal infirmities.

SC: petitioner filed a Petition for Review on Certiorari under Rule 45 assailing the Resolutions
of the CA. SC denied the petition for the following reasons:
(1) the petition was filed beyond the reglementary period of fifteen (15) days;
(2) failure to pay on time docket and other fees and deposit for costs;
(3) insufficient or defective verification.
Petitioner filed the instant Petition for Relief from Judgment.

ISSUE:
Whether or not the petitioner can avail of a petition for relief from judgment under Rule 38 of
the 1997 Rules of Civil Procedure from the SCs resolution denying his petition for review?
(NO)

HELD:
A petition for relief from judgment is not an available remedy in the Supreme Court.

57
First, although Section 1 of Rule 38 states that when a judgment or final order is entered
through fraud, accident, mistake, or excusable negligence, a party in any court may file a
petition for relief from judgment, this rule must be interpreted in harmony with Rule 56,
which enumerates the original cases cognizable by the Supreme Court, thus only petitions
for certiorari, prohibition, mandamus, quo warranto, habeas corpus, disciplinary proceedings
against members of the judiciary and attorneys, and cases affecting ambassadors, other
public ministers and consuls may be filed originally in the Supreme Court. A petition for relief
from judgment is not included in the list of Rule 56 cases originally cognizable by this Court.

Second, while Rule 38 uses the phrase "any court", it refers only to Municipal/Metropolitan
and Regional Trial Courts.
As revised, Rule 38 radically departs from the previous rule as it now allows the Metropolitan
or Municipal Trial Court which decided the case or issued the order to hear the petition for
relief. The procedural change in Rule 38 is in line with Rule 5, prescribing uniform procedure
for Municipal and Regional Trial Courts and designation of Municipal/Metropolitan Trial Courts
as courts of record.

Third, the procedure in the CA and the Supreme Court are governed by separate provisions
of the Rules of Court. It may, from time to time, be supplemented by additional rules
promulgated by the Supreme Court through resolutions or circulars. There is no provision in
the Rules of Court making the petition for relief applicable in the CA or in this Court. The
procedure in the CA from Rules 44 to 55, with the exception of Rule 45 which pertains to the
Supreme Court, identifies the remedies available before said Court such as annulment of
judgments or final orders or resolutions (Rule 47), motion for reconsideration (Rule 52), and
new trial (Rule 53). Nowhere is a petition for relief under Rule 38 mentioned. AEH
TIC
If a petition for relief from judgment is not among the remedies available in the CA, with
more reason that this remedy cannot be availed of in the Supreme Court. This Court
entertains only questions of law. A petition for relief raises questions of facts on fraud,
accident, mistake, or excusable negligence, which are beyond the concerns of this Court.

Nevertheless, even if the SC delve into the merits of the petition, the same must still be
dismissed. The late filing of the petition for review does not amount to excusable negligence.
Petitioner's lack of devotion in discharging his duty, without demonstrating fraud, accident,
mistake or excusable negligence, cannot be a basis for judicial relief. For a claim of counsel's
gross negligence to prosper, nothing short of clear abandonment of the client's cause must
be shown.

DOCTRINE:
The relief afforded by Rule 38 will not be granted to a party who seeks to be
relieved from the effects of the judgment when the loss of the remedy of law was
due to his own negligence, or mistaken mode of procedure for that matter;
otherwise the petition for relief will be tantamount to reviving the right of appeal
which has already been lost, either because of inexcusable negligence or due to a
mistake of procedure by counsel. In exceptional cases, when the mistake of
counsel is so palpable that it amounts to gross negligence, this Court affords a
party a second opportunity to vindicate his right. But this opportunity is
unavailing in the instant case, especially since petitioner has squandered the
various opportunities available to him at the different stages of this case. Public
interest demands an end to every litigation and a belated effort to reopen a case

58
that has already attained finality will serve no purpose other than to delay the
administration of justice.

YUSUKE FUKUZIMA vs SANRITSU GREAT INTERNATIONAL CORP

G.R. NO. 140630 (August 12, 2004)
PETITIONERS: Yusuke Fukuzumi
RESPONDENTS: Sanritsu Great International Corporation, Tetsuji Maruyama, akira Kubota,
Yukio Matsuzaka
PONENTE: Callejo, Sr., J.

FACTS:
Petition for review on certiorari under Rule 45 of the ROC of the order of RTC-Paranaque
denying the petition of Fukuzima for relief from the order of the court denying his notice of
appeal of the decision of the trial court against him and dismissing his appeal

Trial Court = rendered judgement in favour of herein respondents ordering Fukuzima to pay
the former sums of money representing the 2 months rental deposit, other expenses,
damages, attorneys fees and cost.
Defendant = received the copy of decision and filed his MR.
TC = denied the MR
Defendant = instead of perfecting an appeal, he files his notice of appeal one day before the
reglementary period therefor.
TC = denying the defendants notice of appeal.
Defendant = filed a verified petition for relief from the order of the trial court denying his
notice of appeal. He averred that his counsel suffered a high blood pressure which impelled
his counsel to rest and hindered him from filing the notice of appeal on time. He appended
to his petition a verified Medical Certificate issued by Dr. Ma. Lakambini Cruz-Crespo.
TC = denying the defendants petition on the ground that Sec 2 Rule 38 of the Rules of Court
was not applicable.
Defendants = MR of the order
TC = denied the MR
Defendants (now petitioners) = filed a petition for review on certiorari with this Court
alleging THE COURT A QUO HAS DECIDED A QUESTION OF SUBSTANCE IN A WAY NOT IN
ACCORD WITH LAW WHEN IT RULED THAT THE PETITIONERS PETITION FOR RELIEF FROM
DENIAL OF APPEAL FILED PURSUANT TO SECTION 2, RULE 38 OF THE 1997 RULES OF CIVIL
PROCEDURE IS NOT APPLICABLE SINCE THE DENIAL OF THE APPEAL WAS BASED ON
SECTION 3, RULE 41 IN RELATION TO SECTION 2, RULE 22 OF THE 1997 RULES OF CIVIL
PROCEDURE.
Respondents = averred that:
a) the petitioner cannot invoke Rule 38, Section 2 of the Rules of Court which applies only
to negligence of a party and not of his counsel;
b) by his negligence, the petitioner failed to avail of other remedies other than filing his
petition for relief from the June 22, 1999 Order of the trial court; and
c) the alleged high blood pressure of the petitioners counsel is merely an afterthought.

59
ISSUE:
WON petitioner is entitled to the relief under Section 2, Rule 38 of the Rules of Court.

HELD: NO
RATIO DECIDENDI:
The remedy of a party whose notice of appeal is denied by the trial court, although such
notice is filed within the period therefor, is to file a motion for reconsideration of such order
and, if the court denies such motion, to file a petition for certiorari under Rule 65 of the
Rules of Court. If the party is prevented by fraud, accident, mistake or excusable negligence
from filing his notice of appeal within the reglementary period therefor, his remedy is to file
a petition for relief, in the same case, from the order of the trial court denying his notice of
appeal. This is provided in Section 2, Rule 38 of the 1997 Rules of Civil Procedure, which
reads:
SEC. 2. Petition for relief from denial of appeal. When a judgment or final order is rendered
by any court in a case, and a party thereto, by fraud, accident, mistake, or excusable
negligence, has been prevented from taking an appeal, he may file a petition in such court
and in the same case praying that the appeal be given due course.

DOCTRINE:
Such party is not entitled to relief under Rule 38, Section 2 of the Rules of Court if
he was not prevented from filing his notice of appeal by fraud, accident, mistake
or excusable negligence. Such relief will not be granted to a party who seeks to
be relieved from the effects of the judgment when the loss of the remedy of law
was due to his own negligence, or a mistaken mode of procedure for that matter;
otherwise, the petition for relief will be tantamount to reviving the right of appeal
which has already been lost either because of inexcusable negligence or due to a
mistake of procedure by counsel.

If the petition for relief is denied by the trial court, the remedy of the petitioner is
to file a petition for certiorari under Rule 65 of the 1997 Rules of Civil Procedure.

The petitioners failure to file his notice of appeal within the period therefor is far
from excusable. It, rather, shows negligence no less.

It bears stressing that perfection of an appeal in the manner and within the
period prescribed by law is not only mandatory but jurisdictional as well and
failure to perfect an appeal has the effect of rendering the judgment or resolution
final and executory. After all, the right to appeal is not a natural right or a part of
due process; it is merely a statutory privilege, and may be exercised only in the
manner and in accordance with the provisions of law.

While we have ruled that delay in the filing of a notice of appeal does not justify
the dismissal of the appeal, however, the petitioner has not shown any
exceptional circumstances justifying a reversal of the assailed order of the trial
court and the reinstatement of his appeal.

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4. Rule 39 (Execution)
OFFICE OF THE COURT ADMINISTRATOR, Complainant VS. CELESTINA CORPUZ,
Respondent
Carpio, J:

FACTS: This is an administrative case for ignorance of the law, abuse of authority and grave
misconduct against herein respondent Celestina Corpuz (Corpuz). This case originated from
a different administrative case (AM No. MTJ-99-1199) entitled Francisco Lu Vs. Judge Siapno
of MTC Urdaneta, Sheriff Lopez of RTC Urdaneta and Prosecutor Viray. The Court, in the
second administrative case DIRECTED the court administrator to institute the present case
against Corpuz.
Francisco Lu (Lu) was the defendant in a civil case for EJECTMENT raffled to Judge Orlando
Siapno (Siapno). On September 7, 1995, Judge Siapno rendered a decision AGAINST Lu.
Ordering him to immediately VACATE the premises, pay attorneys fees and issued a Writ of
Execution.
Lus counsel received the decision on September 13 and immediately filed a notice of appeal
on the same day. Meanwhile, on September 11, Corpuz issued a WRIT OF EXECUTION and
Sheriff Lopez implemented the same on the date of issuance forcibly rejecting Lu from the
premises.
Lu elevated the case to the RTC. While on appeal, the RTC ISSUED a writ of PRELIMINARY
INJUNCTION and declared VOID the writ of execution issued by the MTC. On February 5,
1996, the RTC rendered a decision DELETING the issuance of the writ from the MTC.
Subsequently, Lu filed an administrative complaint against Siapno, Sheriff Lopez and Atty.
Viray which was docketed as AM No. MTJ-99-1199. Lu charged Siapno with (1) gross
incompetence in the performance of his duties for not dismissing the Ejectment Case; (2)
gross ignorance of the law for rendering a decision providing in its dispositive portion the
issuance of a writ of execution without notice and hearing; (3) abdication of official function;
and (4) gross misconduct.
The court in its decision found Judge Siapno GUILTY of gross ignorance of the law for
declaring, in the dispositive portion, the immediate execution of his decision. The court also
found the Sheriff and Atty. Viray GUILTY. Finally, the court DIRECTED the Office of the Court
Administrator to institute an administrative case against Corpuz for gross ignorance of the
law, abuse of authority and grave misconduct.
The court required Corpuz to COMMENT and in which she denied the charges against her.
She alleged that she never signed any court process or writ WITHOUT INSTRUCTIONS FROM
HER SUPERIOR. She claimed that she was angrily directed to implement the decision and for
fear of being cited for insubordination, she issued the writs of execution.
The investigating judge declared that as second in command in the office, Corpuz should
have read the rules and procedure regarding the issuance of writ of execution despite the
fact that she was doing a ministerial duty and that she was only a commerce graduate. The
investigating judge ruled that she should have taken her job more seriously by reading the
basic laws to guide her work and recommends that Corpuz be fined P2,000.
The OCA affirmed the findings of the Investigating judge and opines that the acts of signing
and issuing a writ of execution without a motion for execution or a hearing prior to the
issuance of the writ indicate irresponsibility and incompetence. Having been a clerk of court
for years, Corpuz should have been conversant with the specific requirements of the Rules of
Court on the signing and issuance of the writ of execution. She occupies a very sensitive

61
position that requires competence and efficiency to insure the publics confidence in the
administration of justice.
ISSUE: W/N Corpuz is guilty for gross ignorance of the rules of court and abuse of authority
SUPREME COURT:
The conclusions and recommendations of the OCA and the Investigating Judge are
AFFIRMED. Corpuz is GUILTY of gross ignorance of the rules of court and abuse of authority
and is FINED P2,000.
Lus counsel received the MTC decision onj September 13 while the writ of execution was
issued and executed on September 11. THIS IS AN IMPROPER PROCEDURE. In the case of
Felongco v. Dictado, reiterating the earlier case of Dy v. Court of Appeals, the losing party
must first receive notice of the judgment before the court or its personnel can execute the
judgment. The reason is that if such judgment is immediately executed without prior notice
to the losing party, then such a party has no remedy if the evidence or law does not support
the judgment.
Moreover, even if the MTC decision itself ordered that a writ of execution be issued, this does
not mean that notice of the motion for execution to the adverse party is unnecessary. The
court cannot direct the issuance of a writ of execution motu proprio. This is what Section 8
(now section 19) of Rule 70 provides:
SEC. 8 (19). Immediate execution of judgment. How to stay same. If judgment is rendered
against the defendant, execution shall issue immediately, unless an appeal has been
perfected and the defendant to stay execution filed a sufficient bond, approved by the
justice of the peace or municipal court and executed to the plaintiff to enter the action in the
Court of First Instance and to pay the rents, damages, and costs accruing down to the time
of the judgment appealed from, and unless, during the pendency of the appeal, he deposits
with the appellate court the amount of the rent due from time to time under the contract, if
any, as found by the judgment of the justice of the peace or municipal court to exist.
All moneys so paid to the appellate court shall be deposited in the provincial or city treasury,
and shall be held there until the final disposition of the appeal, unless the court, by
agreement of the interested parties, or in the absence of reasonable grounds of opposition
to a motion to withdraw, or justifiable reasons, shall decree otherwise. Should the defendant
fail to make the payments above prescribed from time to time during the pendency of the
appeal, the appellate court, upon motion of the plaintiff, of which the defendant shall have
notice, and upon proof of such failure, shall order the execution of the judgment appealed
from with respect to the restoration of possession, but such execution shall not be a bar to
the appeal taking its course until the final disposition thereof on its merits.
Section 8(19), Rule 70 explicitly provides that although execution is immediately executory,
judgment may be stayed by perfecting an appeal, filing a supersedeas bond approved by
the court and periodically paying the rents during the pendency of the appeal.
DOCTRINE: The losing party must first receive notice of the judgment before the
court or its personnel can execute the judgment. The reason is that if such
judgment is immediately executed without prior notice to the losing party, then
such a party has no remedy if the evidence or law does not support the judgment.

Balajonda vs. COMELEC, G.R. No. 166032, February 28, 2005

FACTS:
Balajonda was proclaimed as the duly elected Barangay Chairman (Punong Barangay),
having won the office in the barangay elections. Her margin of victory over private
respondent Maricel Francisco was 420 votes.

62
Francisco duly filed a petition for election protest, within ten (10) days from the date of
proclamation, lodged with the Metropolitan Trial Court (MeTC) of Quezon City

Balajonda alleged that Franciscos petition stated no cause of action and that the allegations
of electoral fraud and irregularities were baseless. She also laid stress on the fact that
although the grounds relied upon by Francisco were violations of election laws, not a single
person had been prosecuted for violation of the same

After the issues were joined, the MeTC ordered the revision of ballots in 69 ballot boxes, and
eventually, the ballots in 39 precincts were revised. After trial, MeTC dismissed the protest
with its finding that Balajonda still led Francisco by 418 votes
Francisco appealed the MeTC Decision to the COMELEC. COMELEC reversed the MeTC,
finding that Francisco won over Balajonda by one hundred eleven 111 votes. The COMELEC
First Division thus annulled the proclamation of Balajonda, and declared in her stead
Francisco as the duly elected Barangay Chairman.

Balajonda filed a Motion for Reconsideration while Francisco filed a Motion for Execution
praying for a writ of execution in accordance with Section 2(a) of Rule 39 of the Revised
Rules of Court [Sec. 2(a), Rule 39], which allows discretionary execution of judgment upon
good reasons to be stated in the order.

Balajonda opposed the motion for execution arguing in the main that under Sec. 2(a), Rule
39, only the judgment or final order of a trial court may be the subject of discretionary
execution pending appeal. However, the COMELEC granted the motion and directed the
issuance of a Writ of Execution

ISSUE: Whether or not the COMELEC may order the immediate execution of its decision

RULING: YES, Despite the silence of the COMELEC Rules of Procedure as to the procedure of
the issuance of a writ of execution pending appeal, there is no reason to dispute the
COMELECs authority to do so, considering that the suppletory application of the Rules of
Court is expressly authorized by Section 1, Rule 41 of the COMELEC Rules of Procedure
which provides that absent any applicable provisions therein the pertinent provisions of the
Rules of Court shall be applicable by analogy or in a suppletory character and effect.
The public policy underlying the suppletory application of Sec. 2(a), Rule 39 is to obviate a
hollow victory for the duly elected candidate as determined by either the courts or the
COMELEC.[24] Towards that end, we have consistently employed liberal construction of
procedural rules in election cases to the end that the will of the people in the choice of
public officers may not be defeated by mere technical objections. [25] Balajondas argument is
anchored on a simplistic, literalist reading of Sec. 2(a), Rule 39 that barely makes sense,
especially in the light of the COMELECs specialized and expansive role in relation to election
cases.
Balajondas corollary argument that the public interest involved or the will of the electorate is
fully determined only after the election contest becomes final [29] would, if sustained, negate
altogether the purpose of allowing executions pending appeal in the first place. Indeed, the
argument begs the question. In this regard, Balajondas filing of a Motion for Reconsideration
of the decision likewise did not divest the COMELEC First Division of jurisdiction to rule on
the Motion For Execution.

63
DOCTRINE: Section 2 allowing execution pending appeal in the discretion of the
court applies in a suppletory manner to election cases, including those involving
city and provincial officials.

Jalandoni vs. PNB, 108 SCRA 102 (1981)

FACTS:

Petitioner Eduardo Jalandoni was ordered to pay the Philippine National Bank the
sum of P63,297.53 with interest thereon until fully paid, by virtue of a final
judgment rendered by the Court of First Instance of Manila on March 31, 1959 in
Civil Case No. 38393. Within five years from the entry judgment, or on March 9,
1964, the sheriff of Silay City, pursuant to an alias writ of execution, levied upon
Jalandoni's property and a Notice of Embargo was annotated thereon. Sale at
public auction to satisfy the judgment was never conducted or initiated by the
bank. On April 22, 1974, more than a decade after the levy was made, Jalandoni
filed with the Court of First Instance of Negros Occidental in a land registration
proceeding, a petition for the cancellation of the levy on the ground of
prescription. The bank oppossed the petition contending that the execution sale
can be made beyond the ten-year period for enforcing the judgment as long as
the levy was effected within five years from the entry of judgment. The Negros
Occidental court directed Jalandoni to ask the Manila court to quash the writ of
execution on the ground of prescription and thereafter to refile his petition.
Jalandoni filed in the same court, an action to quiet title or for the cancellation of
the notice of embargo on the ground that, although more than ten years had
elapsed from the time the levy was made, no execution sale had been held
making the levy inefficacious and constituting a cloud on his title.

RTC: Dissmissed the complaint. Hence, this appeal by his heirs (Jalandoni died on
Jan. 20, 1977) under Republic Act 5440.

PETITIONERS: in support of their contention that the levy cannot be enforced

after the expiration in 1969 of the ten-year period for enforcing the judgment,
rely on the rule laid down in Ansaldo vs. Fidelity and Surety Co. of the P.I, a 1951
case, that "properties levied upon by execution must be sold in public auction
within the period of ten years during which the judgment can be enforced by
action." The reason for that rule is that an execution is enforced (and therefore
accomplished) by levy and sale, not by levy alone.

RESPONDENT: the execution sale can be made beyond the ten-year period for
enforcing the judgment as long as the levy was effected within five years from the
entry of judgment as in the instant case. They rely on the dictum that while
Section 6 of Rule 39 "limits the time within which a writ of execution may be
issued to enforce a judgment, it does not prescribe a period when the sale at
public auction by the sheriff shall take place after the issuance of the writ of

64
execution and a valid levy made pursuant thereto" (Del Rosario vs. Yatco, L-
18735, December 29, 1966, 18 SCRA 1263).

ISSUE:

WON Jalandonis land levied upon within five years after entry of judgement may
be sold at an auction sale after the expiration of the 10-year period for enforcing
the judgement.

HELD:

No. It should be borne in mind that an action upon a judgment must be brought
within ten years from the time the right of action accrues (Art. 1144, Civil Code).
As clarified in the Rules of Court, that prescriptive period means that "a judgment
may be executed on motion within five (5) years from the date of its entry or from
the date it becomes final and executory" and "after the lapse of such time, and
before it is barred by the statute of limitations, a judgment may be enforced by
action" (Sec. 6, Rule 39).

We find that "notice of embargo" annotated in 1964 on Jalandoni's title is no

longer enforceable and has become a cloud upon his title. Following the rule in
the Ansaldo case, he and his heirs have a good cause of action under Article 476
of the Civil Code for the removal of that stale encumbrance. Moreover, Article 478
of the Civil Code provides that "there may also be an action to quiet title or
remove a cloud therefrom when the contract, instrument or other obligation has
been extinguished or has terminated, or has been barred by extinctive
prescription."

DOCTRINE:

Properties levied upon by execution must be sold in public auction within the
period of ten years during which the judgment can be enforced by action.

Fiestan vs. CA, 185 SCRA 751 (1990)

DIONISIO FIESTAN & JUANITA ARCONADO VS. CA
FERNAN, CJ.:
DOCTRINE:
The formalities of a levy, as an essential requisite of a valid execution sale under
Section 15 of Rule 39 and a valid attachment lien under Rule 57 of the Rules of
Court, are not basic requirements before an extrajudicially foreclosed property
can be sold at public auction.
FACTS:

65
Petitioner spouses Dionisio Fiestan and Juanita Arconada were the owners of a parcel of land
situated in Ilocos Sur which they Mortgaged to Development Bank Of The Philippines as
security of their loan amounting to P.22,400.00. petitioners failed to pay and the lot was
acquired by DBP as the highest bidder at a public auction on August 6,1979 after it was
extrajudicially foreclosed by DBP in accordance with Act no.3135 as amended by act no.
4118.
A certificate of sale was subsequently issued by Provincial Sheriff of Ilocos Sur on the same
day and the same was registered on sept 28, 1997 in the ROD of Ilocos Sur. . Earlier, or on
September 26, 1979, petitioners executed a Deed of Sale in favor of DBP which was likewise
registered on September 28, 1979.
Upon failure of petitioners to redeem the property within the one (1) year period which
expired on September 28, 1980, petitioners' TCT T-13218 over Lot No. 2-B was cancelled by
the Register of Deeds and in lieu thereof TCT T-19077 was issued to the DBP upon
presentation of a duly executed affidavit of consolidation of ownership
DBP sold the lot to Francisco Peria in a deed of Absolute sale amd the same was registered
in the ROD of Ilocos Sur. DBPs title over the lot was cancelled and a title was issued to
Francisco Peria. Francisco Peria secured a tax declaration for the said lot and paid taxes due.
He thereafter mortgaged said lot to the PNB Vigan Branch as security for his loan of
P115,000.00 as required by the bank to increase his original loan from P49,000.00 to
P66,000.00 until it finally reached the approved amount of P115,000.00. Since petitioners
were still in possession of Lot No. 2-B, the Provincial Sheriff ordered them to vacate the
premises.
Petitioners filed a complaint for annulment of sale, mortgage and cancewllation of TCT
against DBP-Laoag, PNB-Vigan,Ilocos Sur, Francisco Peria and ROD Ilocos sur in the RTC of
Vigan
RTC: dismissed the complaint, declaring therein, as valid the extrajudicial foreclosure sale of
the mortgaged property in favor of DBP and subsequewnt sale to Peria and PNB.
CA: Affirmed the Decision of the RTC Vigan.
petitioners filed the instant petition for review on certiorari with this Court. Petitioners seek
to annul the extrajudicial foreclosure sale of the mortgaged property on August 6, 1979 in
favor of the Development Bank of the Philippines (DBP) on the ground that it was conducted
by the Provincial Sheriff of Ilocos Sur without first effecting a levy on said property before
selling the same at the public auction sale. Petitioners thus maintained that the extrajudicial
foreclosure sale being null and void by virtue of lack of a valid levy, the certificate of sale
issued by the Provincial Sheriff cannot transfer ownership over the lot in question to the DBP
and consequently the deed of sale executed by the DBP in favor of Francisco Peria and the
real estate mortgage constituted thereon by the latter in favor of PNB Vigan Branch are
likewise null and void.
ISSUE:
W/n extrajudicial foreclosure sale is null and void by virtue of lack of a valid levy?

HELD:
No. The formalities of a levy, as an essential requisite of a valid execution sale under Section
15 of Rule 39 and a valid attachment lien under Rule 57 of the Rules of Court, are not basic
requirements before an extrajudicially foreclosed property can be sold at public auction.
The case at bar, as the facts disclose, involves an extrajudicial foreclosure sale. The public
auction sale conducted on August 6, 1979 by the Provincial Sheriff of Ilocos Sur refers to the
"sale" mentioned in Section 1 of Act No. 3135, as amended, which was made pursuant to a
special power inserted in or attached to a real estate mortgage made as security for the

66
payment of money or the fulfillment of any other obligation. It must be noted that in the
mortgage contract, petitioners, as mortgagor, had appointed private respondent DBP, for
the purpose of extrajudicial foreclosure, "as his attorney-in-fact to sell the property
mortgaged under Act No. 3135, as amended, to sign all documents and perform any act
requisite and necessary to accomplish said purpose .... In case of foreclosure, the Mortgagor
hereby consents to the appointment of the mortgagee or any of its employees as receiver,
without any bond, to take charge of the mortgaged property at once, and to hold possession
of the same ...
There is no justifiable basis, therefore, to apply by analogy the provisions of Rule 39 of the
Rules of Court on ordinary execution sale, particularly Section 15 thereof as well as the
jurisprudence under said provision, to an extrajudicial foreclosure sale conducted under the
provisions of Act No. 3135, as amended. Act No. 3135, as amended, being a special law
governing extrajudicial foreclosure proceedings, the same must govern as against the
provisions on ordinary execution sale under Rule 39 of the Rules of Court.
In extrajudicial foreclosure of mortgage, the property sought to be foreclosed need not be
identified or set apart by the sheriff from the whole mass of property of the mortgagor for
the purpose of satisfying the mortgage indebtedness. For, the essence of a contract of
mortgage indebtedness is that a property has been identified or set apart from the mass of
the property of the debtor-mortgagor as security for the payment of money or the fulfillment
of an obligation to answer the amount of indebtedness, in case of default of payment. By
virtue of the special power inserted or attached to the mortgage contract, the mortgagor
has authorized the mortgagee-creditor or any other person authorized to act for him to sell
said property in accordance with the formalities required under Act No. 3135, as amended.
The Court finds that the formalities prescribed under Sections 2, 3 and 4 of Act No. 3135, as
amended, were substantially complied with in the instant case. Records show that the
notices of sale were posted by the Provincial Sheriff of Ilocos Sur and the same were
published in Ilocos Times, a newspaper of general circulation in the province of Ilocos Sur,
setting the date of the auction sale on August 6, 1979 at 10:00 a.m. in the Office of the
Sheriff, Vigan, Ilocos Sur. 6

Dagooc vs. Erlina, A.M. No. P-04-1857 (formerly OCA I.P.I. No. 02-1429-P), March
16, 2005
DAGOOC vs ERLINA
MAIN ACTION: COMPLAINT FOR MISCONDUCT AND IGNORANCE OF LAW
FACTS:
Merlinda Dagooc filed the above action against Roberto Erlina (Sheriff) in RTC
Surigao del Sur.
DAGOOC alleges:
a) She was the plaintiff in a case in RTC where the court rendered judgment
based on a compromise agreement.
b) Writ of execution was endorsed to ERLINA.
c) Defendants could not pay money judgment but ERLINA asked them to
execute promissory notes instead.
d) Erlina falsely indicated in the return of service that defendants were
insolvent.
ERLINA: alleges in his comment:
a) He served the writ of execution to the defendants who refused to pay.

67
 b) He went to the residence of the defendants to levy on some personal
properties but found them to be exempt from execution (RULE 39 of ROC)
c) He verified with the provincial assessor to check any real properties of
the defendant and and was given a certification that there were none.
d) He made a return of service stating defendants were insolvent.
e) He denies asking DAGOOC to collect via promissory notes.
f) He advised DAGOOC to secure an alias writ of execution so he could go
after the real properties in Surigao.

Complaint was referred to the Office of the Court Administrator and found ERLINA
guilty of misconduct and gross ignorance of the law.

ISSUE: Whether or not ERLINA was guilty

HELD: YES. The law mandates that in the execution of a money judgment, the
judgment debtor shall pay either in cash, certified bank check payable to the
judgment obligee, or any other form of payment acceptable to the latter. Nowhere
does the law mention promissory notes as a form of payment. The only exception
is when such form of payment is acceptable to the judgment debtor. But it was
obviously not acceptable to complainant, otherwise she would not have filed this
case against respondent sheriff. In fact, she objected to it because the promissory
notes of the defendants did not satisfy the money judgment in her favor.
If the judgment debtor cannot pay all or part of the obligation in cash, certified
bank check or other mode of payment acceptable to the judgment obligee, the
money judgment shall be satisfied by levying on the properties of the judgment
debtor.
Respondent sheriff not only failed to levy on the properties of the judgment
debtor when they could not pay the money judgment in cash but also claimed the
exemption for them. His conduct blatantly manifested his incompetence and
ineptitude in discharging his functions. Moreover, respondent sheriff was
seriously remiss in his duties when he stated in his return of service that the
defendants were insolvent without first diligently verifying such fact. As it turned
out, the defendants had real properties he could have levied on to satisfy the
money judgment.
But even assuming that the defendants/judgment debtors were insolvent,
respondent sheriff should have garnished their salaries (being paid employees) to
enforce the judgment in the subject case as provided for in Section 9(c), Rule 39
of the Revised Rules of Court.
Either to desperately cover his tracks after it was pointed out to him that the
defendants were not insolvent at all or out of sheer ignorance of the law,
respondent sheriff advised complainant to file a motion for the issuance of an
alias writ of execution allegedly so that he could levy on the properties of the
defendants. But there was no need for an alias writ of execution for him to levy
on the real properties of the defendants. The life of the writ was for five years
and the judgment of the court had not yet been fully satisfied.
Sheriffs, as public officers, are repositories of public trust and are under
obligation to perform the duties of their office honestly, faithfully and to the best
of their ability. They are bound to use utmost skill and diligence in the
performance of their official duties particularly where the rights of individuals
may be jeopardized by their neglect. Here, we find respondent sheriff utterly

68
wanting in zeal and dedication. He was highly incompetent, downright inefficient
and grossly ignorant of the law when he did not faithfully execute the writ of
execution to the prejudice of complainant.
DOCTRINE: The law mandates that in the execution of a money judgment, the
judgment debtor shall pay either in cash, certified bank check payable to the
judgment obligee, or any other form of payment acceptable to the latter. If the
judgment debtor cannot pay all or part of the obligation in cash, certified bank
check or other mode of payment acceptable to the judgment obligee, the money
judgment shall be satisfied by levying on the properties of the judgment debtor. If
defendants/judgment debtors were insolvent, the sheriff should garnish their
salaries (if they are paid employees) to enforce the judgment in the subject case
as provided for in Section 9(c), Rule 39 of the Revised Rules of Court.

Campillo vs. CA, 129 SCRA 513 (1984)

CAMPILLO VS CA
MAIN ACTION : PETITION FOR CERTIORARI
FACTS:
Tomas DE VERA and his wife Felisa Serafico sold 2 parcels of land in Tondo, Manila
to Simplicio SANTOS. Sale was never presented for registration in the Registry of
Deeds of Manila nor noted in the title covering the property. Sostenes CAMPILLO
obtained a judgment for a sum of money against Tomas DE VERA which became
final and executory. CAMPILLO obtained a writ of execution, and the City sheriff
levied three parcels of land in the name of DE VERA which included those sold to
SANTOS. The parcels of land were sold at public auction in favor of CAMPILLO who
issued the corresponding certificate of sale. CAMPILLO obtained a final deed of
sale, and registered the properties in his name.
SANTOS filed an ACTION TO ANNUL THE LEVY, NOTICE OF SALE, SALE AT PUBLIC
AUCTION and FINAL DEED OF SALE of the lots with DAMAGES.
CAMPILLO alleges in his answer that:
a) He is an innocent purchaser for value
b) The previous sale could not be preferred over the levy and sale because it
was not registered.
RTC: Sustained the validity of the levy and sale at public auction because:
a) Properties were still registered in DE VERAs name at the time of the LEVY
and SALE.
b) The sale to SANTOS, not being registered nor noted, cannot bind third
persons.
CA: On appeal, CA modified the decision by:
a) Dismissed the complaint.

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b) Declared the levy, sale, and sheriffs certificate in favor of CAMPILLO null
and void.
c) Declared SANTOS as the owner of the two parcels of land.
d) Ordered the Register of Deeds to cancel TCTs in favor of CAMPILLO and
issue TCTs in favor of SANTOS.
CAs RATIO:
a) At the time of the auction, DE VERA was no longer the owner.
b) Levy on execution does not take precedence over the unrecorded deed of
sale.
c) The judgment debtor is not a third party within the meaning of the law and
could not be considered a purchaser for value in good faith.
ISSUE: Who has a better right or title to the herein disputed two (2) parcels of
land?
SC: REVERSED. It is settled in this jurisdiction that a sale of real estate, whether
made as a result of a private transaction or of a foreclosure or execution sale,
becomes legally effective against third persons only from the date of its
registration. Consequently, and considering that the properties subject matter
hereof were actually attached and levied upon at a time when said properties
stood in the official records of the Registry of Deeds as still owned by and
registered in the name of the judgment debtor, Tomas de Vera, the attachment,
levy and subsequent sale of said properties are proper and legal. The net result is
that the execution sale made in favor of the herein petitioner transferred to him
all the rights, interest and participation of the judgment debtor in the aforestated
properties as actually appearing in the certificate of title, unaffected by any
transfer or encumbrance not so recorded therein.
The act of registration shall be the operative act to convey or affect the land
insofar as third persons are concerned, and in all cases under this Decree, the
registration shall be made in the office of the Register of Deeds for the province
or city where the land lies.
A person dealing with registered land is not required to go behind the register to
determine the condition of the property. He is only charged with notice of the
burdens on the property which are noted on the face of the register or the
certificate of title. To require him to do more is to defeat one of the primary
objects of the Torrens system. A bona fide purchaser for value of such property at
an auction sale acquires good title as against a prior transferee of same property
if such transfer was unrecorded at the time of the auction sale.
SANTOS invoked Leyson vs Tanada. In that case, a notice of lis pendens was
inscribed at the back of the certificate of title of the land subject therein before it
was sold at public auction. Necessarily, the purchaser at public auction is bound
by the outcome of the pending case referred to therein. Since it turned out that
the judgment debtor is merely a co-owner of the property sold at public auction,
then the purchaser thereat is not entitled to the entirety of the land. The interest
acquired by a purchaser in an execution sale is limited to that which is possessed
by the debtor. If there is more than one person owning property in common and
an execution against one only is levied thereon, the sale effected by the Sheriff
under such execution operates exclusively upon the interest of the execution
debtor, without being in any wise prejudicial to the interest of the other owners.
The result in such case merely is that one new owner in common is substituted for
the owner whose interest is alienated by process of law.

70
While it may be true as stated in the aforesaid case of Leyson vs. Tanada, that
purchasers at execution sales should bear in mind that the rule of caveat emptor
applies to such sales, that the sheriff does not warrant the title to real property
sold by him as sheriff, and that it is not incumbent on him to place the purchaser
in possession of such property, still the rule applies that a person dealing with
registered land is not required to go behind the register to determine the
condition of the property and he is merely charged with notice of the burdens on
the property which are noted on the face of the register or the certificate of title.
DOCTRINE: A person dealing with registered land is not required to go behind the
register to determine the condition of the property and he is merely charged with
notice of the burdens on the property which are noted on the face of the register
or the certificate of title. In case of double sale of realty, the ownership passes to
the vendee who in good faith first recorded it in the Registry of Property (Art.
1544, Civil Code). The rule of caveat emptor applies to execution sales. It is not
incumbent upon the sheriff to place the purchaser in possession of the property.

MANILA REMNANT CO., INC vs CA

G.R. NO. 107282 (March 16, 1994)
PETITIONERS: Manila Remnant Co. Inc. (MRCI)
RESPONDENTS: Court of Appeals and Spouses Oscar Ventanilla and Carmen Gloria
Diaz
PONENTE: Cruz, J.

FACTS:
1. MRCI vs CA (1990) case
The case involved land in Quezon City owned by MRCI and became the subject of
its agreement with AU Valencia and Co. Inc (AUVCI) by virtue of which the latter
was to act as the petitioners agent in the development and sale of the property.
For a stipulated fee, AUVCI was to convert the lands into a subdivision, manage
the sale of the lots, execute contracts and issue official receipts to the lot buyers.
At the time of the agreement, the president of both MRCI and AUVCI was Artemio
U. Valencia.

Pursuant to the above agreement, AUVCI executed 2 contracts to sell (lots 1 and
2) in favour of Sps. Diaz for P66,571.00, payable in 10 years. After 10 days and
without the knowledge of the Ventanilla couple, Valencia, president of MRCI,
resold the same land to Carlos Crisostomo, one of his sales agents, without any
consideration. Upon orders of Valencia, monthly payments of the Ventanillas were
remitted to MRCI as payments of Crisostomo. The receipts were kept by Valencia
without the knowledge of the Ventanillas and Crisostomo. Ventanillas continued
paying their monthly instalments.

MRCI = informed AUVCI that it was terminating their agreement because of

discrepancies discovered in the latters collections and remittances.
Valencia = was removed by the board of directors of MRCI as its president.

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Spouses Ventanilla = learned of the supposed sale of their lots to Crisostomo
commenced an action for specific performance, annulment of deeds and damages
against MRCI, AUVCI and Carlos Crisostomo in the CFI-QC.
TC = declared contract to sell in favour of the Ventanillas VALID and ANNULLING
the contract to sell in favour of Crisostomo. Ordered MRCI to execute absolute
deed of sale in favour of Ventanillas, free from liens and encumbrances. Damages
and attorneys fees be awarded to Ventanillas for which MRCI, AUVCI and
Crisostomo were held solidarily liable.
Valencia and MRCI = appealed separately.
CA = sustained the Trial Court in toto
MRCI = filed a petition before SC for certiorari to review the decision of the CA
Upholding the solidary liability of MRCI, AUVCI and Crisostomo for the payment of
moral and exemplary damages and attorneys fees to the Ventanillas.
SC = affirmed CAs decision and declared judgement of the TC immediately
executory.

2. Present Case
Sps Ventanilla = filed with TC a motion for the issuance of a writ of execution in
the 1990 case. The writ was issued and served upon MRCI.
MRCI = filed a Manifestation and motion with the TC, alleged that the subject
properties could not be delivered to the Ventanillas because they had already
been sold to Samuel Marquez, while their petition was pending in this court.
Nevertheless, MRCI offered to reimburse the amount paid by respondents
including interests plus damages. MRCI prayed that it tender payment be
accepted and all garnishments on their account be lifted.
Ventanillas = accepted the amount of P210K as damages and attorneys fees but
opposed the reimbursement offered by MRCI in lieu of the execution of the
absolute deed of sale, such alleged sale to Samuel Marquez was void, fraudulent,
and in contempt of court and that no claim of ownership over properties in
question had ever been made by Marquez.
Judge Ligot-Telan = order that to To ensure that there is enough amount to cover
the value of the lots involved if transfer thereof to plaintiff may no longer be
effected, pending litigation of said issue, the garnishment made by the Sheriff
upon the bank account of Manila Remnant may be lifted only upon the deposit to
the Court of the amount of P500,000.00 in cash.
MRCI = filed a manifestation and MR praying that it be ordered to reimburse the
Ventanillas in the amount of P263,074.10 and garnishment of its bank deposit be
lifted.
TC = motion was denied
MRCI = filed a 2nd manifestation and motion
TC = denied the same and also required MRCI to show cause why it should not be
cited for contempt for disobedience of its judgement.
MRCI = questioned the TCs orders in a petition for certiorari before respondent
CA on the ground that they were issued with grave abuse of discretion.
CA = ruled that the contract to sell in favor of Marquez did not constitute a legal
impediment to the immediate execution of the judgment. Furthermore, the cash
bond fixed by the trial court for the lifting of the garnishment was fair and

72
reasonable because the value of the lot in question had increased considerably.
The appellate court also set aside the show-cause order and held that the trial
court should have proceeded under Section 10, Rule 39 of the Rules of Court and
not Section 9 thereof.
MRCI = contends that the trial court may not enforce it garnishment order after
the monetary judgment for damages had already been satisfied and the amount
for reimbursement had already been deposited with the sheriff. Garnishment as a
remedy is intended to secure the payment of a judgment debt when a well-
founded belief exists that the erring party will abscond or deliberately render the
execution of the judgment nugatory. As there is no such situation in this case,
there is no need for a garnishment order.

ISSUE:
WON the refusal of the petitioner to execute the absolute deed of sale is valid

HELD: NO
RATIO DECIDENDI:
Section 10 of Rule 39 of the Rules of Court reads as follows:
Sec. 10. Judgment for specific act; vesting title If a judgment directs a party to
execute a conveyance of land, or to deliver deeds or other documents, or to
perform any other specific act, and the party fails to comply within the time
specified, the court may direct the act to be done at the cost of the disobedient
party by some other person appointed by the court and the act when so done
shall have like effect as if done by the party. If real or personal property is within
the Philippines, the court in lieu of directing a conveyance thereof may enter
judgment divesting the title of any party and vesting it in others and such
judgment shall have the force and effect of a conveyance executed in due form of
law.

DOCTRINE:
Against the unjustified refusal of the petitioner to accept payment of the balance
of the contract price, the remedy of the respondents is consignation, conformably
to the following provisions of the Civil Code:

Art. 1256. If the creditor to whom tender of payment has been made refuses
without just cause to accept it, the debtor shall be released from responsibility by
the consignation of the thing or sum due. . .

Art. 1258. Consignation shall be made by depositing the things due at the
disposal of the judicial authority, before whom the tender of payment shall be
proved, in a proper case, and the announcement of the consignation in other
cases.

The consignation having been made, the interested parties shall also be notified
thereof.

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Art. 1260. Once the consignation has been duly made, the debtor may ask the
judge to order the cancellation of the obligation.

Accordingly, upon consignation by the Ventanillas of the sum due, the trial court
may enter judgment canceling the title of the petitioner over the property and
transferring the same to the respondents. This judgment shall have the same
force and effect as conveyance duly executed in accordance with the
requirements of the law.

Malonzo vs. Mariano, 170 SCRA 667 (1989)

Petitioners: Sps Enrico and Avelina Malonzo, Barbara Brown, Bonifacia Monzon
Respondents: Hon. Herminio Mariano, Banco Filipino Savings and Mortgage, Sheriff of Manila

Universal Ventures Inc. mortgaged two parcels of land plus the apartment and the
commercial building constructed thereon in favor of Banco Filipino as security for a loan of
P350,000 which was later amended to P400,000. The mortgage deed authorized the
extrajudicial foreclosure of the property in case of default in the payment. Universal failed
to pay the loan, thus Banco Filipino caused the extra-judicial foreclosure of the property.
Banco Filipino was the highest bidder, and a Certificate of Title was executed in its name.
Banco Filipino then filed a petition for a writ of possession in accordance with Sec. 7 of Act
No. 3135 as amended by Act No. 4118 with the CFI of Manila, citing the aforementioned
facts and adding that: 1) Universal failed to redeem the property within the 1 year period
allowed by law, and 2) Universal and certain other persons claiming rights under the former
were still in possession of the property, although the said rights were not recorded in the
Register of Deeds. The petition contained a Notification addressed to the clerk of court,
and copies of such were served to Universal and the persons alleged to be claiming rights
under it.

RTC:
Respondent Judge Mariano ruled in favor of the petitioners. He ordered the issuance of the
Writ of Possession prayed for, and directed the Sheriff of Manila or his duly authorized
representative to place Banco Filipino in actual possession of the foreclosed properties and
to eject Universal, its officers, agents and other persons claiming under said respondent
from the properties.

The Sheriff of Manila attempted to evict the petitioners. E. Malonzo, Brown and Monzon filed
a suit against Banco Filipino and the Sheriff to refrain from enforcing the writ, and to recover
damages. They alleged that they were occupying their respective premises in the foreclosed
property by virtue of a verbal lease contract with Universal, and since there was no
ejectment case filed against them, they were entitled to remain in possession and could not
be ousted under the writ. Two weeks after, the petitioners instituted a special civil action for
prohibition against the respondents stating the same defense.

Sec. 7 of Act 3135 grants to a purchaser at an extra-judicial foreclosure sale an absolute

right to possession of the property sold during the 1-yr period of redemption and, a fortiori,
after the lapse of said period without any redemption being made. Possession may be
obtained under a writ which may be applied for ex parte. No redemption was made within 1
year from the registration of the sale, thus Banco Filipino had the absolute right to a writ of
possession, or stated otherwise, the ministerial duty of the Court to issue the writ, upon
mere motion, without need of instituting a separate action for the purpose.

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Issue:
Whether or not the Sheriff may enforce the writ of possession against persons, other than
the mortgagor, who are occupying the foreclosed property.

Held:
Yes, pursuant to Sec. 35, Rule 39 of the Rules of Court which are inter alia suppletory to act
3135.

Under Sec. 6 of Act 3135 and Sections 29-31 and 35, Rule 39 of the ROC, in case of an
extra-judicial foreclosure of a real estate mortgage, the possession of the
property sold may be given to the purchaser by the sheriff after the period of
redemption has expired, unless a third person is actually holding the property
adversely to the mortgagor. An ordinary action for the recovery of possession is not
necessary. There is no law in this jurisdiction whereby the purchaser at a sheriffs sale of
real property is obliged to bring a separate and independent suit for possession after the one
year period for redemption has expired and after he has obtained the sheriffs final
certificate of sale.

The petitioners cannot be deemed third parties actually holding the property adversely to
the mortgagor. They derive their rights to the possession of the property exclusively from
the mortgagor, as per the verbal agreements of lease. Since they were lessees at the time
the property was mortgaged, they were charged with constructive knowledge upon its
registration, if they did not indeed know of it. The right pertaining to them was that of being
notified of the application for a writ of possession and of being accorded an opportunity at a
hearing to oppose by showing that they were actually holding the property adversely. This
right was accorded to them as they were served copies of the motion or petition for the
issuance of the writ. The proceedings showed that they were not holding the property
adversely to the mortgagor, but were exercising rights derived from Universal. Upon the
cessation of Universals rights over the property, theirs also ceased. The writ of possession
was therefore properly enforceable against them.

Sec. 49(b) of Rule 39 is also applicable as it contemplates declaring a final and executory
judgment or order conclusive and hence enforceable not only against the parties but also
their successors in interest by title subsequent to the commencement of action or special
proceeding. Pursuant to this provision, a judgment in personam directing a party to deliver
possession of property to another is binding not only against the former, but also against his
successors in interest by title subsequent to the commencement of the action, i.e. those
whose possessory rights are derived from him e.g. lessees, possessors by tolerance,
assignees. As regards the latter, it is not required that a separate action be instituted
against them to litigate the issue of possession. Due process is satisfied by holding a
hearing, with notice to them, on the nature of their possession, and thereafter denying or
acceding to the enforcement of a writ of possession against them as the findings at said
hearing shall warrant.

Case dismissed. Remanded to Court to issue in favor of Banco Filipino an alias writ of
possession enforceable against petitioners or their successors in interest, and all other
persons claiming under, or not otherwise actually holding the property adversely to
Universal.

Doctrines:
It is the ministerial duty of the Court upon mere motion to issue a writ of
possession to the purchaser of property sold in an extra-judicial foreclosure of real
estate mortgage after the one year period for redemption has expired without any
redemption being made.

75
 A party who claims to be actually holding the property adversely to the
mortgagor has the right to be notified of, and to be heard on, the application for a
writ of possession.
The lessees of the mortgagor cannot be considered third parties "actually
holding the property adversely" to said party from whom they derive their rights to
the possession to the property; their rights to the possession to the property; their
rights cease with those of the mortgagor, and a writ of possession is enforceable
against them.

Del Rosario vs Far East Bank and Trust Company, G.R. No. 150134, October 31,
2007
ERNESTO C. DEL ROSARIO and DAVAO TIMBER CORPORATION, petitioners, vs. FAR EAST
BANK & TRUST COMPANY and PRIVATE DEVELOPMENT CORPORATION OF THE PHILIPPINES,
respondents.
FACTS:
Davao Timber Corporation (DATICOR) and respondent Private Development Corporation of
the Philippines (PDCP) entered into a loan agreement under which PDCP extended to
DATICOR a foreign currency loan of US $265,000 and a peso loan of P2.5 million or a total
amount of approximately P4.4 million, computed at the then prevailing rate of exchange of
the dollar with the peso.
The loan agreement provided that DATICOR shall pay: (1) a service fee of one percent (1%)
per annum (later increased to six percent [6%] per annum) on the outstanding balance of
the peso loan; (2) 12 percent (12%) per annum interest on the peso loan; and (3) penalty
charges of two percent (2%) per month in case of default.
The loans were secured by real estate mortgages over six parcels of land one situated in
Manila (the Otis property) registered in the name of petitioner Ernesto C. Del Rosario, and
five in Mati, Davao Oriental and chattel mortgages over pieces of machinery and
equipment.
Petitioners paid a total of P3 million to PDCP, which the latter applied to interest, service fees
and penalty charges. This left petitioners, by PDCP's computation, with an outstanding
balance on the principal of more than P10 million as of May 15, 1983.
Petitioners had filed a complaint against PDCP before CFI Manila for violation of the Usury
Law, annulment of contract and damages.
CFI: dismissed case HAEDCT
IAC: set aside the CFI's dismissal of the complaint and declared void and of no effect the
stipulation of interest in the loan agreement between DATICOR and PDCP.
PDCP appealed the IAC's decision to this Court where PDCP assigned a portion of its
receivables from petitioners (the receivables) to its co-respondent Far East Bank and Trust
Company (FEBTC) under a Deed of Assignment dated April 10, 1987 for a consideration of
P5,435,000. The Deed of Assignment was later amended by two Supplements.
FEBTC, as assignee of the receivables, and petitioners later executed a MOA whereby
petitioners agreed to, as they did pay FEBTC the amount of P6.4 million as full settlement of
the receivables.

76
Court: affirming in toto the decision of the IAC ruling that after deducting the P3 million
earlier paid by petitioners to PDCP, their remaining balance on the principal loan was only
P1.4 million.
Petitioners: thus filed Complaint for sum of money against PDCP and FEBTC before the RTC
of Makati, mainly to recover the excess payment which they computed to be P5.3 million
P4.335 million from PDCP, and P965,000 from FEBTC.
Makati RTC: ordered PDCP to pay petitioners the sum of P4.035 million, to bear interest at
12% per annum from April 25, 1994 until fully paid; to execute a release or cancellation of
the mortgages on the five parcels of land in Mati, Davao Oriental and on the pieces of
machinery and equipment and to return the corresponding titles to petitioners; and to pay
the costs of the suit.
As for the complaint of petitioners against respondent FEBTC, the trial court dismissed it for
lack of cause of action, ratiocinating that the MOA between petitioners and FEBTC was not
subject to this Court's Decision, FEBTC not being a party thereto.
From the trial court's decision, petitioners and respondent PDCP appealed to the Court of
Appeals (CA).
CA: holding that petitioners' outstanding obligation, which this Court had determined in G.R.
No. 73198 to be P1.4 million, could not be increased or decreased by any act of the creditor
PDCP; it held that when PDCP assigned its receivables, the amount payable to it by DATICOR
was the same amount payable to assignee FEBTC, irrespective of any stipulation that PDCP
and FEBTC might have provided in the Deed of Assignment, DATICOR not having been a
party thereto, hence, not bound by its terms. cASEDC
Citing Articles 2154 and 2163 of the Civil Code which embody the principle of solutio
indebiti, the CA held that the party bound to refund the excess payment of P5 million was
FEBTC as it received the overpayment; and that FEBTC could recover from PDCP the amount
of P4.035 million representing its overpayment for the assigned receivables based on the
terms of the Deed of Assignment or on the general principle of equity.
Accordingly, the CA ordered PDCP to execute a release or cancellation of the mortgages it
was holding over the Mati real properties and the machinery and equipment, and to return
the corresponding certificates of title to petitioners. And it ordered FEBTC to pay petitioners
the amount of P965,000 with legal interest from the date of the promulgation of its
judgment.
FEBTC's motion for reconsideration of the CA Decision was denied, and so was its
subsequent appeal to this Court.
Petitioners: filed before the RTC of Makati a Complaint against FEBTC to recover the balance
of the excess payment of P4.335 million.
FEBTC: In its Answer, denied responsibility, it submitting that nowhere in CA decision was it
held liable to return the whole amount of P5.435 million representing the consideration for
the assignment to it of the receivables, and since petitioners failed to claim the said whole
amount in their original complaint as they were merely claiming the amount of P965,000
from it, they were barred from claiming it.
FEBTC: later filed a Third Party Complaint against PDCP praying that the latter be made to
pay the P965,000 and the interests adjudged by the CA in favor of petitioners, as well as the
P4.335 million and interests that petitioners were claiming from it. It posited that PDCP
should be held liable because it received a consideration of P5.435 million when it assigned
the receivables.

77
PDCP: contended that since petitioners were not seeking the recovery of the amount of
P965,000, the same cannot be recovered via the third party complaint; went on to contend
that since the final and executory decision in CA-G.R. CV No. 50591 had held that DATICOR
has no cause of action against it for the refund of any part of the excess payment, FEBTC
can no longer re-litigate the same issue; PDCP contended that it was not privy to the MOA
which explicitly excluded the receivables from the effect of the Supreme Court decision, and
that the amount of P6.4 million paid by petitioners to FEBTC was clearly intended as
consideration for the release and cancellation of the lien on the Otis property. cDEHIC
FEBTC: PDCP cannot deny that it benefited from the assignment of its rights over the
receivables from petitioners. It added that the third party claim being founded on a valid and
justified cause, PDCP's counterclaims lacked factual and legal basis.
Petitioners: filed a Motion for Summary Judgment to which FEBTC filed its opposition.
TC: denied the motion for summary judgment for lack of merit and subsequently assailed
Decision dismissing petitioners' complaint on the ground of res judicata and splitting of
cause of action.
Petitioners' MR was denied. Hence, the present petition.
ISSUE:
Whether their complaint is dismissible on the ground of res judicata and splitting of cause of
action
HELD:HSCEc
The petition is bereft of merit.
Section 47 of Rule 39 of the Rules of Court, on the doctrine of res judicata, reads:
Sec. 47. Effect of judgments or final orders. The effect of a judgment or final
order rendered by a court of the Philippines, having jurisdiction to pronounce the
judgment or final order, may be as follows:
xxx xxx xxx
(b) In other cases, the judgment or final order is, with respect to the matter directly
adjudged or as to any other matter that could have been raised in relation thereto,
conclusive between the parties and their successors in interest by title subsequent
to the commencement of the action or special proceeding, litigating for the same
thing and under the same title and in the same capacity; and
(c) In any other litigation between the same parties or their successors in interest,
that only is deemed to have been adjudged in a former judgment or final order
which appears upon its face to have been so adjudged, or which was actually and
necessarily included therein or necessary thereto. (Underscoring supplied)
The above-quoted provision lays down two main rules. Section 49 (b) * enunciates the first
rule of res judicata known as "bar by prior judgment" or "estoppel by judgment," which
states that the judgment or decree of a court of competent jurisdiction on the merits
concludes the parties and their privies to the litigation and constitutes a bar to a new action
or suit involving the same cause of action either before the same or any other tribunal.
Stated otherwise, "bar by former judgment" makes the judgment rendered in the first
case an absolute bar to the subsequent action since that judgment is conclusive not only as
to the matters offered and received to sustain it but also as to any other matter which might
have been offered for that purpose and which could have been adjudged therein. It is in this

78
concept that the term res judicata is more commonly and generally used as a ground for a
motion to dismiss in civil cases.
The second rule of res judicata embodied in Section 47 (c), Rule 39 is "conclusiveness of
judgment." This rule provides that any right, fact, or matter in issue directly adjudicated or
necessarily involved in the determination of an action before a competent court in which a
judgment or decree is rendered on the merits is conclusively settled by the judgment therein
and cannot again be litigated between the parties and their privies whether or not the claim
or demand, purpose, or subject matter of the two suits is the same. 32 It refers to a situation
where the judgment in the prior action operates as an estoppel only as to the matters
actually determined or which were necessarily included therein. 33
The case at bar satisfies the four essential requisites of "bar by prior judgment," viz:
(a) finality of the former judgment;
(b) the court which rendered it had jurisdiction over the subject matter and
the parties;
(c) it must be a judgment on the merits; and cHaCAS
(d) there must be, between the first and second actions, identity of parties,
subject matter and causes of action. 34
There is no doubt that the judgment on appeal was a final judgment. Not only did it dispose
of the case on the merits; it also became executory as a consequence of the denial of
FEBTC's motion for reconsideration and appeal.
Neither is there room to doubt that the judgment in Civil Case No. 94-1610 was on the
merits for it determined the rights and liabilities of the parties. To recall, it was ruled that: (1)
DATICOR overpaid by P5.3 million; (2) FEBTC was bound to refund the excess payment but
because DATICOR's claim against FEBTC was only P965,000, the court could only grant so
much as the relief prayed for; and (3) PDCP has no further claim against DATICOR because
its obligation had already been paid in full. Right or wrong, that judgment bars another case
based upon the same cause of action.
As to the requisite of identity of parties, subject matter and causes of action, it cannot be
gainsaid that the first case, Civil Case No. 94-1610, was brought by petitioners to recover an
alleged overpayment of P5.3 million P965,000 from FEBTC and P4.335 million from PDCP.
On the other hand, Civil Case No. 00-540, filed by the same petitioners, was for the recovery
of P4.335 million which is admittedly part of the P5.3 million earlier sought to be recovered
in Civil Case No. 94-1610. This time, the action was brought solely against FEBTC which in
turn impleaded PDCP as a third party defendant.
In determining whether causes of action are identical to warrant the application of the rule
of res judicata, the test is to ascertain whether the same evidence which is necessary to
sustain the second action would suffice to authorize a recovery in the first even in cases in
which the forms or nature of the two actions are different. Simply stated, if the same facts
or evidence would sustain both, the two actions are considered the same within the rule that
the judgment in the former is a bar to the subsequent action.
It bears remembering that a cause of action is the delict or the wrongful act or omission
committed by the defendant in violation of the primary rights of the plaintiff.
In the two cases, petitioners imputed to FEBTC the same alleged wrongful act of mistakenly
receiving and refusing to return an amount in excess of what was due it in violation of their
right to a refund. The same facts and evidence presented in the first case, were the very
same facts and evidence that petitioners presented.

79
Thus, the same Deed of Assignment between PDCP and FEBTC, the first and second
supplements to the Deed, the MOA between petitioners and FEBTC, and this Court's Decision
in G.R. No. 73198 were submitted in Civil Case No. 00-540.
Notably, the same facts were also pleaded by the parties in support of their allegations for,
and defenses against, the recovery of the P4.335 million. Petitioners, of course, plead the CA
Decision as basis for their subsequent claim for the remainder of their overpayment. It is
well established, however, that a party cannot, by varying the form of action or adopting a
different method of presenting his case, or by pleading justifiable circumstances as herein
petitioners are doing, escape the operation of the principle that one and the same cause of
action shall not be twice litigated. ScHa
In fact, authorities tend to widen rather than restrict the doctrine of res judicata on the
ground that public as well as private interest demands the ending of suits by requiring the
parties to sue once and for all in the same case all the special proceedings and remedies to
which they are entitled. 41
This Court finds well-taken then the pronouncement of the court a quo that to allow the re-
litigation of an issue that was finally settled as between petitioners and FEBTC in the prior
case is to allow the splitting of a cause of action, a ground for dismissal under Section 4 of
Rule 2 of the Rules of Court reading:
SEC. 4. Splitting of a single cause of action; effect of. If two or more suits are
instituted on the basis of the same cause of action, the filing of one or a judgment
upon the merits in any one is available as a ground for the dismissal of the others.
(Emphasis and underscoring supplied)
This rule proscribes a party from dividing a single or indivisible cause of action into
several parts or claims and instituting two or more actions based on it. Because the
plaintiff cannot divide the grounds for recovery, he is mandated to set forth in his first
action every ground for relief which he claims to exist and upon which he relies; he
cannot be permitted to rely upon them by piecemeal in successive actions to recover for
the same wrong or injury.

Clearly then, the judgment operated as a bar to other, following the above-quoted Section 4,
Rule 2 of the Rules of Court.
WHEREFORE, the Petition is DENIED. RTC AFFIRMED.
DOCTRINE:
In determining whether causes of action are identical to warrant the application
of the rule of res judicata, the test is to ascertain whether the same evidence
which is necessary to sustain the second action would suffice to authorize a
recovery in the first even in cases in which the forms or nature of the two actions
are different. Simply stated, if the same facts or evidence would sustain both, the
two actions are considered the same within the rule that the judgment in the
former is a bar to the subsequent action.
Both the rules on res judicata and splitting of causes of action are based on the
salutary public policy against unnecessary multiplicity of suits interest
reipublicae ut sit finis litium. Re-litigation of matters already settled by a court's
final judgment merely burdens the courts and the taxpayers, creates uneasiness
and confusion, and wastes valuable time and energy that could be devoted to
worthier cases.

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Napocor vs. Maruhom, 609 SCRA 198
DOCTRINE: Writs of Execution; it is a fundamental legal axiom that a writ of
execution must conform strictly to the dispositive portion of the decision sought
to be executed. Otherwise, it is null and void.
The term grave abuse of discretion, in its juridical sense, connotes capricious,
despotic, oppressive, or whimsical exercise of judgment as is equivalent to lack of
jurisdiction.
FACTS:
Lucman G. Ibrahim and his co-heirs Omar G. Maruhom, Elias G.
Maruhom, Bucay G. Maruhom, Mamod G. Maruhom, Farouk G. Maruhom,
Hidjara G. Maruhom, Rocania G. Maruhom, Potrisam G. Maruhom, Lumba G.
Maruhom, Sinab G. Maruhom, Acmad G. Maruhom, Solayman G. Maruhom,
Mohamad M. Ibrahim and Cairoronesa M. Ibrahim (Respondents) are owners
of a 70,000-square meter lot in Saduc, Marawi City. NPC, without
respondents knowledge and consent, took possession of the subterranean
area of the land and constructed therein underground tunnels. The tunnels
were used by NPC in siphoning the water located in Saguiran, Lanao del
Sur; Nangca and Balo-i in Lanao del Norte; and Ditucalan and Fuentes in
Iligan City.

Upon, discovery of the existence of the tunnels. Respondents demanded

that NPC pay damages and vacate the subterranean portion of the land, but
the demand was not heeded.

Respondents instituted an action for recovery of possession of land and

damages against NPC with the Regional Trial Court (RTC) of Lanao del Sur.

RTC Lanao Del Sur rendered a decision denied respondents prayer.

o Ordering [NPC] to pay to [respondents] the fair market value of said
Lots for P48,005,000.00 for the remaining unpaid portion of lot with
6% interest per annum;
o Reasonable monthly rental P7,050,974.40;
o P200,000.00 as moral damages;
o P200,000.00 as attorneys fees and the costs.

Respondents then filed an Urgent Motion for Execution of Judgment

Pending Appeal. On the other hand, NPC filed a Notice of Appeal.
Thereafter, it filed a vigorous opposition to the motion for execution of
judgment pending appeal with a motion for reconsideration of the RTC
decision.

NPC withdrew its Notice of Appeal to give way to the hearing of its
motion for reconsideration. RTC issued an Order granting execution
pending appeal and denying NPCs motion for reconsideration. The Decision

81
 of the RTC was executed pending appeal and the funds of NPC were
garnished by respondents.

Respondents filed a Petition for Relief from Judgment, asserting:

o They did not file a motion to reconsider or appeal the decision within
the reglementary period of fifteen (15) days from receipt of judgment
because they believed in good faith that the decision was for
damages and rentals and attorneys fees only as prayed for in the
complaint;
o Amounts awarded to the respondents represented not only rentals,
damages and attorneys fees but the greatest portion of which was
payment of just compensation which, in effect, would make the
petitioner NPC the owner of the parcels of land involved in the case;
o They learned of the nature of the judgment, the period of appeal had
already expired;
o They were prevented by fraud, mistake, accident, or excusable
negligence from taking legal steps to protect and preserve their
rights over their parcels of land;
o They would never have agreed to the alienation of their property in
favor of anybody, they inherited from their dear father and they
would rather see their land crumble to dust than sell it to anybody.

After due proceedings, the RTC granted the petition and rendered a
modified judgment
o Reducing the judgment award;
o Awarding the sum of P1,476,911.00 to respondents as reasonable
rentals;
o Ordering [NPC] to pay [respondents] the sum of P200,000.00 as
moral damages; and further sum of P200,000.00 as attorneys fees
and costs.

Lucman Ibrahim and NPC then filed their separate appeals with the CA.
CA setting aside the modified judgment and reinstating the original
Decision, amending it further by deleting the award of moral damages and
reducing the amount of rentals and attorneys fees.

NPC moved for reconsideration of the Decision, but this Court denied it.
Respondents filed with the RTC a motion for execution of its decision, as
modified by the CA. RTC granted the motion, and issued the corresponding
writ of execution. Subsequently, a notice of garnishment was issued upon
NPCs depositary bank.

NPC then filed a Petition for Certiorari (with Urgent Prayer for the
Immediate Issuance of a Temporary Restraining Order and/or Writ of
Preliminary Injunction) with the CA that RTC gravely abused its discretion
when it granted the motion for execution without ordering respondents to
transfer their title in favor of NPC. By allowing the payment of just

82
 compensation for a parcel of land without the concomitant right of NPC to
get title thereto, the RTC clearly varied the terms of the judgment justifying
the issuance of a writ of certiorari.

NPC also prayed for the issuance of a TRO to enjoin the implementation
of the writ of execution and notice of garnishment. CA granted NPCs prayer
and issued a TRO, enjoining the implementation of the writ of execution
and the notice of garnishment.

CA dismissed NPCs petition for certiorari. CA declared that it intended

NPC to pay the full value of the property as compensation without ordering
the transfer of respondents title to the land. Ordered NPC to pay its
admitted obligation to respondents.

NPC is now before us faulting the CA for dismissing the formers petition
for certiorari. This Court granted NPCs prayer, and issued a TRO enjoining
the execution of the assailed CA Decision.

ISSUE: W/N RTC committed grave abuse of discretion in issuance of writ of

execution.

HELD: NO. Petition is DENIED. The assailed Decision of the CA is AFFIRMED. The
TRO issued is LIFTED.

It is a fundamental legal axiom that a writ of execution must conform strictly

to the dispositive portion of the decision sought to be executed. A writ of
execution may not vary from, or go beyond, the terms of the judgment it seeks to
enforce. When a writ of executiondoes not conform strictly to a decisions
dispositive portion, it is null and void.

Clearly, the writ of execution issued by the RTC and affirmed by the CA does
not vary, but is, in fact, consistent with the final decision in this case. The
assailed writ is, therefore, valid.

In fine, the issuance by the RTC of a writ of execution and the notice of
garnishment to satisfy the judgment in favor of respondents could not be
considered grave abuse of discretion. The term grave abuse of discretion, in its
juridical sense, connotes capricious, despotic, oppressive, or whimsical exercise
of judgment as is equivalent to lack of jurisdiction. The abuse must be of such
degree as to amount to an evasion of positive duty or a virtual refusal to perform
a duty enjoined by law, as where the power is exercised in an arbitrary and
capricious manner by reason of passion and hostility.The word capricious, usually
used in tandem with the term arbitrary, conveys the notion of willful and
unreasoning action. Thus, when seeking the corrective hand of certiorari, a clear
showing of caprice and arbitrariness in the exercise of discretion is imperative.

83
 In this case, NPC utterly failed to demonstrate caprice or arbitrariness on the
part of the RTC in granting respondents motion for execution. Accordingly, the CA
committed no reversible error in dismissing NPCs petition for certiorari.

MMDA vs. Concerned Residents of Manila Bay, 574 SCRA 661

FACTS
RTC:
-Respondents Concerned Residents filed a complaint before the RTC against MMDA together
with several gov't agencies (petitioners).
The complaint alleged that the water quality of Manila bay had fallen way below allowable
standards set by law.

-RTC rendered a decision in favor of respondents assigning to petitioner government

agencies respective duties ordering them to clean up and rehabilitate Manila Bay in a
consolidated and concerted scheme of action.

CA:
-Petitioner agencies filed their respective appeals before the CA but CA sustained the RTC's
Decision.

SC:
-Petitioners challenged the decision in SC stating that clean up of Manila bay is not
ministerial act hence cannot be compelled by mandamus.
SC rejected petitioners contention stating that such clean up is part of their duty and does
not require discretion, hence may be compelled by mandamus. On December 2008, SC ruled
again in favor of respondents.

-The government agencies did not file any motion for reconsideration and the Decision
became final in January 2009.

-Hence, the case is considered to be in the execution phase of the final and executory
December 2008 Decision. On February 2009, the Court En Banc approved a resolution
creating the Manila Bay Advisory Committee, which was created to receive and evaluate the
quarterly progressive reports on the activities undertaken by the agencies in accordance
with said decision and to monitor the execution phase (It is composed of two members of
the Court and three technical experts).

- In the absence of specific completion periods, the Committee recommended that time
frames be set for the agencies to perform their assigned
tasks.
ISSUE
WON such subsequent resolutions may be viewed as an encroachment over the powers and
functions of the Executive Branch headed by the President of the Philippines.

84
HELD:
Such view is misplaced. The issuance of subsequent resolutions by the Court is simply an
exercise of judicial power under Art. VIII of the Constitution, because the execution of the
Decision is but an integral part of the adjudicative function of the Court. In fact, none of the
agencies ever questioned the power of the Court to implement the December 18, 2008
Decision nor has any of them raised the alleged encroachment by the Court over executive
functions.

While additional activities are required of the agencies like submission of plans of action,
data or status reports, these directives are but part and parcel of the execution stage of a
final decision under Rule 39 of the Rules of Court. Section 47 of Rule 39 reads:
Section 47. Effect of judgments or final orders.The effect of a judgment or final order
rendered by a court of the Philippines, having jurisdiction to pronounce the
judgment or final order, may be as follows:
xxxx
(c) In any other litigation between the same parties of their successors in interest,
that only is deemed to have been adjudged in a former judgment or final
order which appears upon its face to have been so adjudged, or which was
actually and necessarily included therein or necessary thereto.

It is clear that the final judgment includes not only what appears upon its face to have been
so adjudged but also those matters actually and necessarily included therein or necessary
thereto. Certainly, any activity that is needed to fully implement a final judgment is
necessarily encompassed by said judgment.

With the final and executory judgment, the writ of continuing mandamus issued means that
until petitioner-agencies have shown full compliance with the Courts orders, the Court
exercises continuing jurisdiction over them until full execution of the judgment.

DOCTRINE
Final judgment includes not only what appears upon its face to have been so
adjudged but also those matters actually and necessarily included therein or
necessary thereto. Any activity that is needed to fully implement a final judgment
is necessarily encompassed by said judgment.

With the final and executory judgment, the writ of continuing mandamus issued
means that until petitioner-agencies have shown full compliance with the Courts
orders, the Court exercises continuing jurisdiction over them until full execution
of the judgment.

City of Naga vs. Asuncion, 557 SCRA 528

G.R. No. 174042
City of Naga, as represented by Mayor Jesse M. Robredo vs Asuncion
Facts:

85
Macario A. Mariano and Jose A. Gimenez were the registered owners of parcel of land in Naga
City. The land was subdivided into several lots and sold as part of City Heights Subdivision
(CHS). The officers of CHS offered to construct the Naga City Hall on a two (2)-hectare lot
within the premises of the subdivision. Said lot was to be designated as an open space for
public purpose and donated to petitioner in accordance with the rules and regulations of the
National Urban Planning Commission. By Resolution No. 75 dated July 12, 1954, the
Municipal Board of Naga City (Municipal Board) asked CHS to increase the area of the land to
four (4) hectares. Accordingly, CHS amended its offer to five (5) hectares.
The Municipal Board adopted Resolution No. 89 accepting CHS amended offer. Mariano and
Gimenez thereafter delivered possession of the lots described as Blocks 25 and 26 to the
City Government of Naga (city government). Eventually, the contract for the construction of
the city hall was awarded by the Bureau of Public Works through public bidding to Francisco
O. Sabaria, a local contractor. This prompted Mariano and Gimenez to demand the return of
the parcels of land from petitioner. On assurance, however, of then Naga City Mayor Monico
Imperial that petitioner will buy the lots instead, Mariano and Gimenez allowed the city
government to continue in possession of the land.
Macario A. Mariano died. Meanwhile, the city government continued in possession of the
lots, and constructed the Naga City Hall on Block 25 and the public market on Block 26. It
also conveyed to other government offices portions of the land which at present, house the
National Bureau of Investigation (NBI), Land Transportation Office, and Hall of Justice, among
others.
Danilo D. Mariano, as administrator and representative of the heirs of Macario A. Mariano,
demanded from petitioner the return of Blocks 25 and 26 to CHS. Alas, to no avail.
Respondent filed a Complaint for unlawful detainer against petitioner before the Municipal
Trial Court (MTC) of Naga City, Branch 1. MTC dismissed the case for lack of jurisdiction.
MTC: It ruled that the citys claim of ownership over the lots posed an issue not cognizable in
an unlawful detainer case.
RTC: reversed. It directed petitioner to surrender physical possession of the lots to
respondents with forfeiture of all the improvements, and to pay P2,500,000.00 monthly as
reasonable compensation for the use and occupation of the land; P587,159.60 as attorneys
fees; and the costs of suit.
Petitioner filed a Motion for Inhibition against Presiding RTC Judge Filemon B. Montenegro for
alleged bias and partiality. Then, petitioner moved for reconsideration/new trial of
theDecision. The RTC denied both motions.
Petitioner filed a Petition for Review with Very Urgent Motion/Application for Temporary
Restraining Order and Writ of Preliminary Prohibitory Injunction with the Court of Appeals.
Respondents thereafter filed a Motion to Issue Writ of Execution.
Respondents manifested that they will not seek execution against the NBI, City Hall and Hall
of Justice in case the writ of preliminary injunction is denied.
CA: DENIED the writ of preliminary injunction.
RTC: a writ of Execution pending appeal was ordered to be issued.
Clerk of Court issued a writ of execution pending appeal. Sheriff served a notice to vacate on
respondents, and a notice of garnishment on Land Bank, Naga City Branch.
Issue:
W/N there was grave abuse of discretion on the RTC judge in allowing the immediate
execution of its judgment.
Petitioners argument: the people of Naga would be deprived of access to basic social
services even before respondents right to possess the land has been conclusively

86
established. The City of Naga assails the validity of the order of execution issued by the
court inasmuch as it excluded the NBI, City Hall and Hall of Justice from its coverage.
Held:
No.
Section 21, Rule 70 of the Rules of Court is pertinent:
SEC. 21. Immediate execution on appeal to Court of Appeals or Supreme Court. The
judgment of the Regional Trial Court against the defendant shall be immediately executory,
without prejudice to a further appeal that may be taken therefrom.
The judgment of the RTC against the defendant in an ejectment case is immediately
executory. Unlike Section 19, Rule 70 of the Rules, Section 21 does not provide a means to
prevent execution; hence, the courts duty to order such execution is practically ministerial.
Section 21 of Rule 70 presupposes that the defendant in a forcible entry or unlawful detainer
case is unsatisfied with the judgment of the RTC and decides to appeal to a superior court. It
authorizes the RTC to immediately issue a writ of execution without prejudice to the appeal
taking its due course. Nevertheless, it should be stressed that the appellate court may stay
the said writ should circumstances so require.
This is not to say that the losing defendant in an ejectment case is without recourse to avoid
immediate execution of the RTC decision. The defendant may, as in this case, appeal said
judgment to the Court of Appeals and therein apply for a writ of preliminary injunction.
A writ of preliminary injunction is available to prevent threatened or continuous irremediable
injury to parties before their claims can be thoroughly studied and adjudicated. Its sole
objective is to preserve the status quo until the merits of the case can be heard fully. Status
quo is the last actual, peaceable and uncontested situation which precedes a controversy.
As a rule, the issuance of a preliminary injunction rests entirely within the discretion of the
court taking cognizance of the case and will not be interfered with, except in cases of
manifest abuse.Grave abuse of discretion implies a capricious and whimsical exercise of
judgment tantamount to lack or excess of jurisdiction. The exercise of power must have
been done in an arbitrary or a despotic manner by reason of passion or personal hostility. It
must have been so patent and gross as to amount to an evasion of positive duty or a virtual
refusal to perform the duty enjoined or to act at all in contemplation of law.
We find that the Court of Appeals abused its discretion when it denied petitioners
application for a writ of preliminary injunction because of the pendency of respondents
Motion to Issue Writ of Execution with the RTC, but ruled on the merits of the application at
the same time.
Be it noted that for a writ of preliminary injunction to be issued, the Rules of Court do not
require that the act complained of be in clear violation of the rights of the applicant. Indeed,
what the Rules require is that the act complained of be probably in violation of the rights of
the applicant. Under the Rules, probability is enough basis for injunction to issue as a
provisional remedy. This situation is different from injunction as a main action where one
needs to establish absolute certainty as basis for a final and permanent injunction.
Needless to reiterate, grave and irreparable injury will be inflicted on the City of Naga by the
immediate execution of the June 20, 2005 RTC Decision. Foremost, as pointed out by
petitioner, the people of Naga would be deprived of access to basic social services. We hold
that the Notice of Garnishment dated August 23, 2006 is void.
It is elementary that a sheriffs duty in the execution of the writ is purely ministerial; he is to
execute the order of the court strictly to the letter. He has no discretion whether to execute
the judgment or not. The rule may appear harsh, but such is the rule we have to observe.
Doctrine:

87
The judgment of the RTC against the defendant in an ejectment case is
immediately executory. This is not to say that the losing defendant in an
ejectment case is without recourse to avoid immediate execution of the RTC
decision. The defendant may, as in this case, appeal said judgment to the Court of
Appeals and therein apply for a writ of preliminary injunction.

Iligan Bay Manufacturing Corp. vs. Dy, 524 SCRA 55

ILIGAN BAY MANUFACTURING CORP., UNITED COCONUT OIL MILLS, INC., and JEREMIAS
BENICO, vs. HENRY DY

Facts: In the late 1970's, petitioner Iligan Bay Manufacturing Corp. (IBMC) constructed its oil
mills on a parcel of land covered by TCT in the Province of Lanao del Norte. Respondent
Henry Dy was one of the suppliers that provided electrical and construction supplies for the
said oil mills. IBMC subsequently became part of co-petitioner United Coconut Oil Mills'
(UNICOM), a conglomerate of oil mills which thrived during the martial law era.

When UNICOM took over its management, IBMC became bankrupt which led to its creditors
initiating suits for the collection of unpaid obligations. Also, UNICOM acquired the right, title,
and interest of the Development Bank of the Philippines over the loan accounts of IBMC,
including the mortgage on the land covered by TCT, where IBMC's oil mill was located.
UNICOM: as assignee of IBMC's loan obligations, foreclosed the mortgage and acquired the
lot covered by TCT in a public auction sale as it was the highest bidder for P20M
Provincial Treasurer of Lanao del Norte certified that IBMC and/or UNICOM was delinquent in
paying its real estate taxes since 1984, hence provincial government to levy on the disputed
lot. It was then sold at public auction where respondent Henry Dy emerged as the highest
bidder for PhP290,692.26 plus PhP10,000. A Certificate of Sale was subsequently issued
which he immediately registered with the Register of Deeds of Lanao del Norte.
Due to IBMC'S unpaid obligations, respondent filed collection suits before the Lanao del
Norte RTC. A writ of attachment was issued over the disputed lot
Respondent: exercised his right of redemption in the tax delinquency sale pursuant to
Sections 78 and 80 of PD 464 by tendering to the Provincial Treasurer a check amounting to
PhP319,718.34. The Office of the Provincial Treasurer then issued the PTO Official Receipt as
acknowledgment to the receipt of the check.
Provincial Prosecutor Fajardo replied to the Provincial Treasurer's query regarding the
"correct interpretation of Sec. 78 of PD 464 as to how the subject property may be validly
redeemed", and opined that:
(A)ny person holding a duly recorded lien or claim over the property has a right to redeem
said property at any time within one year after the sale through an action in Court. Hence,
redemption can only be done legally by means of court proceedings to be instituted by the
person who claims to have lien on the [property] subject of auction sale. T
Respondent sent a letter to the Provincial Treasurer, asking that a certificate of redemption
be issued in his favor, as he claimed that he had redeemed the subject property in
accordance with the first paragraph of Sec. 78, PD 464. The Provincial Treasurer, however,
did not accede to Henry Dy's demand.
An undated letter from Jeremias B. Benico, President of Unicom expressing his willingness to
redeem the disputed lot was received by the Office of the Provincial Treasurer = deposit the

88
amount of P383,978.20 with this Office or at the Office of the Municipal Treasurer of
Kauswagan where the property is [situated] subject to final negotiation with the Office of the
[P]rovincial [P]rosecutor of his Province.
Respondent and his counsel received a letter from the Provincial Treasurer, informing him of
the May 19, 1989 legal opinion of Prosecutor Fajardo on how the subject property may be
validly redeemed.
The Provincial Treasurer reiterated that "redemption can only be done legally by means of
court proceedings to be instituted by the person who claims to have a lien on the property
subject of the auction sale." In effect, this letter denied respondent's request for the
issuance of a final deed of sale in his favor.
A Notice to Redeem over the disputed lot was sent by UNICOM to the Provincial Treasurer to
which the latter sought legal advice from the Office of the Provincial Prosecutor on what
cause of action his Office would take. Pending the legal opinion on the matter of redemption
of UNICOM's property, the Provincial Treasurer, on September 15, 1989, acknowledged
receipt of the redemption price paid by UNICOM in the amount of PhP447,517.21 by issuing
O.R. 089760.
Office of the Provincial Prosecutor: opined, arguing that "there is no legal basis enough to
refuse and deny the right of the interested party." Thereafter, using the Provincial
Prosecutor's legal opinion as a basis, the Provincial Treasurer issued a Certificate of
Redemption to UNICOM on November 2, 1989.
Respondent was informed of the Provincial Treasurer's issuance of a Certificate of
Redemption to UNICOM, and he was further advised that "the amount he deposited with the
Office of the Provincial Treasurer under Check in the amount of P319,718.34 and the
redeemed value of real property taxes penalties.
Office of the Provincial Treasurer: wrote Jeremias B. Benico informing him that there was still
an additional redemption price due from UNICOM in the amount of PhP13,742.11. Because of
UNICOM's failure to pay and remit the total redemption price, respondent requested on April
10, 1990 that a final deed of sale be executed in his favor since the right of redemption was
not effectively exercised by UNICOM within the one year period. However, the Provincial
Treasurer again denied respondent's request.
IBMC and respondent Henry Dy: executed a Compromise Agreement, wherein they agreed
to settle amicably. The pertinent portions of the agreement states:
1. parties have agreed that this compromise Agreement maybe pleaded to abate
any action or proceedings which may subsequently be brought by one against the
other arising [out] of or in connection with the cause or causes of action which gave
rise to the three (3) civil cases, subject matter hereof or related thereto. The
abatement shall apply to the parties herein as well as to all their predecessors or
successors-in-interest;
2. Plaintiff unconditionally agree Writ of Attachment which was issued and
registered in the name of defendant with the land records of Lanao del Norte, at the
instance of plaintiff shall be deemed automatically discharged and cancelled without
need of any Court pronouncement.
Register of Deeds of Lanao del Norte shall cancel the aforesaid annotation on TCT No. 4789
without any further Order from this Honorable Court.
Respondent, filed a case for Mandamus with Damages. Before the presentation of evidence,
respondent and the Provincial Treasurer entered into a Partial Compromise Agreement. By
virtue of this document, respondent signed an April 2, 1992 receipt acknowledging the
return of PhP346,830.71 to him.

89
RTC Iligan City: found that the refusal of the Provincial Treasurer to issue a bill of sale in favor
of respondent Henry Dy was proper and in accordance with law and that filing the case for
Mandamus with Damages despite knowledge of the valid redemption made by UNICOM,
respondent acted in gross bad faith; the filing of said case clearly violated the Compromise
Agreement between him and IBMC; and ruled that the case was clearly related to the three
(3) civil cases mentioned earlier and therefore was barred because of the Compromise
Agreement.
CA: Compromise Agreement did NOT bar the filing of the present suit. It ratiocinated that
while there was an identity of parties between Civil Cases and the petition for mandamus,
there was no identity of subject matter hence, res judicata did not apply; the redemption
made by UNICOM was not valid and that since UNICOM failed to properly redeem the subject
property, respondent's purchase of the disputed lot at the tax delinquency sale had become
final; thus, Henry Dy was entitled to the issuance of a final bill of sale; DENIED MR. Hence
this petition for review.
Issue
whether UNICOM had validly redeemed the subject property.
Held:
Res Judicata:
Petitioners maintain that the CA committed grave and reversible error when it declared that
the Compromise Agreement between petitioner IBMC and respondent Dy did not preclude
the filing of the mandamus case. aDICET
This claim has no merit.
From the provisions of the Compromise Agreement, it cannot be gainsaid that respondent
and IBMC executed it in order to: (1) amicably settle and terminate Civil Case Nos. 1300,
1322, and 1324; (2) abate any action or proceeding arising out of or in connection with the
cause or causes of action which gave rise to the three civil actions; (3) discharge and cancel
the Writ of Attachment annotated on TCT No. T-4,789; and (4) prevent future actions based
on the claims and counterclaims in the three (3) civil actions. HAEDCT
Article 2036 of the New Civil Code whereas provides that:
A compromise [agreement] comprises only those objects which are definitely stated therein,
or which by necessary implication from its terms should be deemed to have been included in
the same.
A general renunciation of rights is understood to refer only to those that are connected with
the dispute which was the subject of the compromise.
The three (3) civil actions the subjects of the May 7, 1990 Compromise Agreement
were actions for the collection of sums of money which arose from IBMC's unfulfilled
obligation to pay; whereas the case for Mandamus with Damages was an action to compel
the Provincial Treasurer of Lanao del Norte to issue a final bill of sale in respondent's favor,
which arose from the Provincial Treasurer's refusal to issue the final bill of sale.
Obviously, the mandamus case was neither included in the Compromise Agreement nor
should it be deemed included in it because the said case did not arise in connection with the
cause or causes of action which led to the filing of the three (3) civil actions. Moreover, the
said case was not based on the claims and counterclaims pleaded in said civil actions.
Thus, it is apparent from the foregoing discussion that the CA correctly held that the May 7,
1990 Compromise Agreement did not preclude the filing of the mandamuscase against the
Provincial Treasurer of Lanao del Norte.

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Redemption of the Subject Property:
On the validity of the redemption made by UNICOM, the petition has merit.
The applicable law to resolve the main issue is PD 464, 33 entitled "Enacting a Real Property
Tax Code", that was in effect at the time of the initiation of the action.
Sec. 78 of PD 464 provides for the redemption of real property after the sale on execution
due to tax delinquency. Sec. 78 reads as follows:
Redemption of real property after sale. Within the term of one year from the date of the
registration of sale of the property, the delinquent taxpayer or his representative, or in his
absence, any person holding a lien or claim over the property, shall have the right to redeem
the same by paying the provincial or city treasurer or his deputy the total amount of taxes
and penalties due up to the date of redemption, the costs of sale and the interest at the rate
of twenty per centum on the purchase price, and such payment shall invalidate the sale
certificate issued to the purchaser and shall entitle the person making the same to a
certificate from the provincial or city treasurer or his deputy, stating that he had redeemed
the property. ICTDEa
The provincial or city treasurer or his deputy shall, upon surrender by the purchaser of the
certificate of sale previously issued to him, forthwith return to the latter the entire purchase
price paid by him plus the interest at twenty per centum per annum herein provided for, the
portion of the cost of the sale and other legitimate expenses incurred by him, and said
property shall thereafter be free from the lien of said taxes and penalties.
Meanwhile, respondent Dy bases his claim over the disputed lot on Sec. 80 of PD 464, which
reads as follows:
Issuance of final bill of sale. In case the delinquent taxpayer or his representative, or
any person holding a lien or claim over the property, fails to redeem the same within
the period of one year from the date of sale as provided in Section seventy-eight hereof,
the provincial or city treasurer shall make an instrument sufficient in form and effect to
convey to the purchaser the property purchased by him, free from any encumbrance or
third party claim whatsoever, and the said instrument shall succinctly set forth all
proceedings upon which the validity of the sale depends. Any balance of the proceeds
of the sale left after deducting the amount of the taxes and penalties due and the costs
of sale, shall be returned to the owner or his representative.
Redemption has been defined as "the right of a debtor, and sometimes of a debtor's other
creditors, to repurchase from a buyer at a forced sale, property of the debtor that was seized
and sold in satisfaction of a judgment or other claim against the debtor, which right is
usually limited to forced [sale] of real property". The concept of redemption is to allow the
owner to repurchase or to buy back, within a certain period and for a certain amount, a
property that has been sold due to debt, tax, or encumbrance.
The redemption period is the time within which redemption may be made. As provided in
Sec. 78 of PD 464, the period within which the redemptioner may exercise his/her right of
redemption is one (1) year from the date of registration of the sale.
In the present case, the tax delinquency sale was conducted on November 9, 1988, when
Henry Dy emerged as the highest bidder. On the same day, Henry Dyregistered a Certificate
of Sale with the Register of Deeds of Lanao del Norte. UNICOM then exercised its right to
redeem on November 2, 1989; therefore, UNICOM had exercised its right to redeem the
property within the one (1) year redemption period.
As provided in Sec. 78 of PD 464, the redemption price should consist of: (1) the total
amount of taxes and penalties due up to the date of redemption, (2) the costs of sale, and
(3) the interest at the rate of twenty per centum (20%) on the purchase price. We find no

91
error in the CA's finding that there was a deficiency of PhP13,742.11 in UNICOM's
redemption price. However, we find no evidence that UNICOM was notified of this deficiency.
The Provincial Treasurer's letters, which were submitted as evidence to prove that there was
a deficiency in UNICOM's redemption payment, did not prove that UNICOM received such
letters; thus, there was substantial compliance of the requirements of the law.
We also maintained in Cometa v. Court of Appeals that this Court allowed parties in several
cases to perfect their right of redemption even beyond the prescribed period. In the light of
the established policy to aid rather than to defeat the right of redemption the
redemption made by UNICOM is hereby upheld. EIcTAD
Petition is GRANTED. Resolution of the CA are REVERSED and SET ASIDE, and RTC decisionis
REINSTATED with the modifications:
DOCTRINE:
We have established in jurisprudence that in cases involving redemption, the law
protects the original owner. It is the policy of the law to aid rather than to defeat
the owner's right. Therefore, "redemption should be looked upon with favor and
where no injury will follow, a liberal construction will be given to our redemption
laws, specifically on the exercise of the right to redeem." In Doronilla v. Vasquez,
this Court allowed the redemption in certain cases even after the lapse of the one
(1)-year period in order to promote justice. This Court even went further in Delos
Reyes v. Intermediate Appellate Court, when the rule on redemption was liberally
interpreted in favor of the original owner of the property to give him another
opportunity to recover his property, should his fortunes improve. Finally, in
Rosales v. Yboa, this Court held that: SHECcT
In fine, We hold that the failure of the mortgagor Pedro Oliverio to tender the
amount of P745.47 representing the delinquent real estate taxes of the subject
property, the registration fee of P3.00 and the interest thereon of P0.04, the
Sheriff's Commission in the sum of P99.82, and the deficiency interest on the
purchase price of the subject property, will not render the redemption in
question null and void, it having been established that he has substantially
complied with the requirements of the law to effect a valid redemption, with his
tender of payment of the purchase price and the interest thereon within twelve
(12) months from the date of the registration of the sale. This ruling is in
obedience of the policy of the law to aid rather than to defeat the right of
redemption.

Premiere Development Bank vs. Flores, 574 SCRA 66

PREMIERE DEVELOPMENT BANK v. HON. ALFREDO FLORES, ARIZONA TRANSPORT
CORPORATION and PANACOR MARKETING CORPORATION

Facts: Panacor Marketing Corp. (Panacor) acquired an exclusive distributorship of products

manufactured by Colgate Palmolive Philippines, Inc. (Colgate). Panacor applied for a loan
with Premiere Development Bank (Premiere) to meet the capital requirements of the
exclusive distributorship. Premiere rejected the loan application and suggested that its
affiliate company, Arizona Transport Corporation (Arizona), should instead apply for the loan
on condition that the proceeds thereof shall be made available to Panacor. Eventually,
Panacor was granted a credit line. Arizona, which was an existing loan client, applied for and
was granted a loan of P6.1M P3.4M of which would be used to pay-off its existing loan
accounts and remaining P2.7M as credit line of Panacor. As security for the loan obtained by
Arizona, it executed a Real Estate Mortgage.

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The P2.7M released by Premiere fell short of the P4.1M credit line which was previously
approved, Panacor negotiated for a take- out loan with IBA- Finance Corporation in sum of
P10M P 7.5M of which will be released outright to take- out the loan from Premiere and
balance of P2.5M to be released after cancellation by Premiere of the collateral mortgage
property. Due to the aforementioned agreement, IBA- Finance was authorized to pay
Premiere the prior existing loan obligations of Arizona in an amount not to exceed P6M.

IBA- Finance sent a letter to the OIC of Premiere Bank San Juan Branch, informing her of the
approved loan in favor of Panacor and Arizona and requesting for the release of the parcel of
land subject of the mortgage. Later on, Premiere sent a letter-reply to IBA- Finance informing
the latter of its refusal to turn over the requested documents on the ground that Arizona had
existing unpaid loan obligations and it was the banks policy to require full payment if all
outstanding loan obligations prior to release of mortgage documents.

Panacor requested IBA-Finance for the immediate approval and release of the remaining
P2.5M loan to meet the required monthly purchases from Colgate. IBA-Finance explained
however, that the processing of the P2.5 million loan application was conditioned on the
submission of the owner's duplicate copy of TCT of the parcel of land and the cancellation by
Premiere of Arizona's mortgage. Due to Premieres refusal to release the mortgage
cancellation document, Panacor failed to generate the required capital to meet its
distribution and sales targets. Thus, Colgate informed Panacor of its decision to terminate
their distribution agreement.

Panacor and Arizona filed a complaint for specific performance and damages against
Premiere Bank before the RTC of Pasig City (Civil Case No. 65577). IBA-Finance filed a
complaint-in-intervention praying that judgment be rendered ordering Premiere to pay
damages in its favor.

Trial court rendered a decision in favor of Panacor and IBA-Finance. Premiere appealed to
the Court of Appeals, which affirmed with modification the decision of the trial court.

Incidentally, Panacor and Arizona received a notice of sheriff's sale during the pendency of
G.R. No. 159352; and they were able to secure an injunction from the RTC but the CA set it
aside and the motion for reconsideration was also denied. The Court did not give due course
to the petition for review of respondent corporations as it did not find any reversible error in
the decision of the appellate court. After the Court had denied with finality the motion for
reconsideration, the mortgaged property was purchased by Premiere Development Bank at
the foreclosure sale. Respondent corporations filed a motion for execution asking for the
issuance of a writ of execution of our decision in G.R. No. 159352 and damages were
awarded in their. RTC granted the writ of execution sought. CA affirmed the order. Hence, the
petition for review.

Contention of Premiere: execution of our decision in G.R. No. 159352 would allegedly be
iniquitous and unfair since respondent corporations are already in the process of winding up

Issue: Whether or not the grant of the writ of execution by the RTC is proper

Held: The Court finds the petition unmeritorious.

A judgment becomes "final and executory" by operation of law. In such a situation, the
prevailing party is entitled to a writ of execution, and issuance thereof is a ministerial duty of
the court. This policy is clearly and emphatically embodied in Rule 39, Section 1 of the Rules
of Court, to wit:

SEC. 1. Execution upon judgments or final orders. Execution shall issue as a

matter of right, on motion, upon a judgment or order that disposes of the

93
 action or proceeding upon the expiration of the period to appeal therefrom if
no appeal has been duly perfected.

If the appeal has been duly perfected and finally resolved, the execution may
forthwith be applied for in the court of origin, on motion of the judgment
obligee, submitting therewith certified true copies of the judgment or
judgments or final order or orders sought to be enforced and of the entry
thereof, with notice to the adverse party.

The appellate court may, on motion in the same case, when the interest of
justice so requires, direct the court of origin to issue the writ of execution.

Jurisprudentially, the Court has recognized certain exceptions to the rule as where in cases
of special and exceptional nature it becomes imperative in the higher interest of justice to
direct the suspension of its execution; whenever it is necessary to accomplish the aims of
justice; or when certain facts and circumstances transpired after the judgment became final
which could render the execution of the judgment unjust.

None of these exceptions avails to stay the execution of this Court's decision in G.R. No.
159352. Premiere Development Bank has failed to show how injustice would exist in
executing the judgment other than the allegation that respondent corporations are in the
process of winding up. Indeed, no new circumstance transpired after our judgment had
become final that would render the execution unjust.

Silverio et al vs. Filpino Business Consultants Inc, G.R. No. 143312, August 12,
2005
Ponente: Carpio, J.

DOCTRINE: EXECUTION OF JUDGMENT; MAY BE STAYED WHEN SUPERVENING

EVENTS BRING ABOUT MATERIAL CHANGE IN THE SITUATION OF PARTIES; NO
JUDGMENT ON THE MERITS IN CASE AT BAR. The court may stay immediate
execution of a judgment when supervening events, occurring subsequent to the
judgment, bring about a material change in the situation of the parties. To justify
the stay of immediate execution, the supervening event must have a direct effect
on the matter already litigated and settled. Or, the supervening events must
create a substantial change in the rights or relations of the parties which would
render execution of a final judgment unjust, impossible or inequitable making it
imperative to stay immediate execution in the interest of justice. In this case,
there is no judgment on the merits, only a judgment on a technicality. The
issuance of the writ of possession in favor of Silverio, Jr., Esses and Tri-Star is also
not a judgment on the merits. A writ of possession is an order whereby the sheriff
is commanded to place a person in possession of real or personal property.|
F
FACTS: The parties are wrangling over possession of a 62 hectare-land in Calatagan,
Batangas. Silverio, Jr, President of Esses and Tri-Star. Esses and Tri-Star were in possession of
the Calatagan Property, covered by TCT No. T-55200 and registered in the names of Esses
and Tri-Star. The latter executed a Deed of Sale with Assumption of Mortgage in favor of
FBCI. However, they failed to redeem the Calatagan Property.

FBCI filed a Petition for Consolidation of Title of the Calatagan Property with the RTC Balayan.
FBCI obtained a judgment by default. Subsequently, TCT No. T-55200 in the names of Esses
and Tri-Star was cancelled and TCT No. T-77656 was issued in FBCI's name.

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RTC issued a writ of possession in FBCI's favor. FBCI then entered the Calatagan Property.

When Silverio, Jr., Esses and Tri-Star learned of the judgment by default and writ of
possession, they filed a petition for relief from judgment and the recall of the writ of
possession. Silverio, Jr., Esses and Tri-Star alleged that the judgment by default is void
because the RTC did not acquire jurisdiction over them. FBCI allegedly forged the service of
summons on them.

RTC then nullified and set aside the judgment by default and the writ of possession. They
found that the summons and the complaint were not served on Silverio, Jr., Esses and Tri-
Star. They then directed the service of summons anew on Silverio, Jr., Esses and Tri-Star.

RTC denied FBCI's motion for reconsideration of the order. FBCI then filed a petition for
certiorari with the Court of Appeals questioning the RTCsOrder.

CA denied FBCI's petition. Court also denied FBCI's motion for reconsideration.

The Supreme Court denied FBCI's petition.

Consequently, the RTC modified its Order by upholding FBCI's possession of the Calatagan
Property. The RTC ruled that FBCI could not be deprived of possession of the Calatagan
Property because FBCI made substantial improvements on it. Possession could revert to
Silverio, Jr., Esses and Tri-Star only if they reimburse FBCI. The RTC gave Silverio, Jr., Esses
and Tri-Star 15 days to file their responsive pleadings.

Silverio, Jr., Esses and Tri-Star moved for the partial reconsideration of the said Order.
Silverio, Jr., Esses and Tri-Star argued that since the judgment by default was nullified, they
should be restored to their possession of the Calatagan Property. FBCI did not file any
opposition to the motion.

RTC reversed its Order by holding that Silverio, Jr., Esses and Tri-Star had no duty to
reimburse FBCI. The RTC pointed out that FBCI offered no evidence to substantiate its claim
for expenses. The Order also restored possession of the Calatagan Property to Silverio, Jr.,
Esses and Tri-Star pursuant to Rule 39, Section 5 of the 1997 Rules of Civil Procedure. This
provision provides for restitution in case of reversal of an executed judgment. RTC denied
FBCI's motion for reconsideration.

RTC issued the writ of possession to Silverio, Jr., Esses and Tri-Star.

FBCI filed with the RTC a Manifestation and Motion to Recall Writ of Possession on the ground
that the decision of the Court of Appeals was not yet final and FBCI's motion for
reconsideration was still pending. FBCI filed with the RTC an Urgent Ex-Parte Motion to
Suspend Enforcement of Writ of Possession. FBCI pointed out that it is now the new owner of
Esses and Tri-Star having purchased the "substantial and controlling shares of stocks" of the
two corporations.

RTC issued the order suspending the writ of possession it had earlier issued to Silverio, Jr.,
Esses and Tri-Star. It reasoned that it would violate the law on forum shopping if it executed
the writ while FBCI's motion for reconsideration of the Court of Appeals' decision and urgent
motion to suspend the issuance of the writ of possession remained pending with the Court of
Appeals. It noted that because of FBCI's strong resistance, Silverio, Jr., Esses and Tri-Star
have still to take possession of the Calatagan Property. More than ten days had already
passed from the time that the RTC had issued the writ of possession. FBCI had barricaded

95
the Calatagan Property, threatening bloodshed if possession will be taken away from it. The
RTC believed that if it would not restrain Silverio, Jr., Esses and Tri-Star from taking
possession of the Calatagan Property, a violent confrontation between the parties might
occur. Without issuing a restraining order, the RTC suspended the writ by requesting the
counsel of Silverio, Jr., Esses and Tri-Star to allow the court to study the voluminous records
of the case, which are to be presented at the hearing which would determine the existence
of a supervening event. RTC issued an Order cancelling the hearing so that the Court of
Appeals could resolve the issue regarding the existence of a supervening event. However, it
declared that the suspension of the writ of possession would be lifted. Silverio, Jr., Esses and
Tri-Star filed a complaint for annulment of contracts with damages with the Regional Trial
Court of Las Pias City.

ISSUE: Whether or not theres a supervening event occurring subsequent to the judgment
that will bring about a material change in the situation of the parties

HELD: No supervening event in this case. We rule in favor of Silverio, Jr., Esses and Tri-Star.

The court may stay immediate execution of a judgment when supervening events, occurring
subsequent to the judgment, bring about a material change in the situation of the parties. To
justify the stay of immediate execution, the supervening events must have a direct effect on
the matter already litigated and settled. Or, the supervening events must create a
substantial change in the rights or relations of the parties which would render execution of a
final judgment unjust, impossible or inequitable making it imperative to stay immediate
execution in the interest of justice.

In this case, there is no judgment on the merits, only a judgment on a technicality. Even
then, the judgment of default rendered in FBCI's favor was voided because the RTC did not
acquire jurisdiction over Silverio, Jr., Esses and Tri-Star due to a fraudulent service of
summons. The case for consolidation of title, from which this petition stemmed, is in fact still
being litigated before the RTC.

The issuance of the writ of possession in favor of Silverio, Jr., Esses and Tri-Star is also not a
judgment on the merits. A writ of possession is an order whereby the sheriff is commanded
to place a person in possession of real or personal property. The issuance of the writ of
possession to Silverio, Jr., Esses and Tri-Star is but an order of restitution a consequence of
the nullification of the judgment by default. The order of restitution placed the parties in the
situation prior to the RTC Balayan's rendition of the void judgment by default. Title to the
Calatagan Property is still in the names of Esses and Tri-Star. Possession of the Calatagan
Property must revert to Esses and Tri-Star as legal owners of the property. However, with the
reinstitution of the case for consolidation of title with the RTC, possession of the Calatagan
Property is now subject to the outcome of the case. Nonetheless, while this case is still under
litigation it is only in the pre-trial stage Esses and Tri-Star in whose names the
Calatagan Property is titled and in whose favor the order of restitution was issued, are the
ones entitled to possession of the property.

Moreover, FBCI's acquisition of the "substantial and controlling shares of stocks" of Esses
and Tri-Star does not create a substantial change in the rights or relations of the parties that
would entitle FBCI to possession of the Calatagan Property, a corporate property of Esses
and Tri-Star. Esses and Tri-Star, just like FBCI, are corporations. A corporation has a
personality distinct from that of its stockholders. Thus, FBCI's alleged controlling
shareholdings in Esses and Tri-Star merely represent a proportionate or aliquot interest in
the properties of the two corporations. Such controlling shareholdings do not vest FBCI with
any legal right or title to any of Esses and Tri-Star's corporate properties. As a stockholder,
FBCI has an interest in Esses and Tri-Star's corporate properties that is only equitable or
beneficial in nature. Even assuming that FBCI is the controlling shareholder of Esses and Tri-

96
Star, it does not legally make it the owner of the Calatagan Property, which is legally owned
by Esses and Tri-Star as distinct juridical persons. As such, FBCI is not entitled to the
possession of any definite portion of the Calatagan Property or any of Esses and Tri-Star's
properties or assets. FBCI is not a co-owner or tenant in common of the Calatagan Property
or any of Esses and Tri-Star's corporate properties.|||

*GIST: FBCI took possession of the Calatagan Property after the RTC rendered a judgment
by default in FBCI's favor. The judgment by default was nullified after the RTC found out
that the service of summons on Silverio, Jr., Esses and Tri-Star was procured fraudulently.
The RTC thus recalled the writ of possession it had issued to FBCI. Silverio, Jr., Esses and
Tri-Star were served anew with summons. The RTC restored possession of the Calatagan
Property to Silverio, Jr., Esses and Tri-Star as restitution resulting from the annulment of the
judgment by default. The order restoring possession of the Calatagan Property to Silverio,
Jr., Esses and Tri-Star has attained finality. This case then proceeded to pre-trial. CI

FBCI has resisted the enforcement of the writ of possession by barricading the Calatagan
Property and threatening violence if its possession of the property is taken away from it. To
avoid bloodshed, as FBCI also claimed that Silverio, Jr. had armed civilians threatening to
shoot FBCI's representatives, the RTC momentarily suspended the execution of the writ. The
RTC lso had to rule on FBCI's claim of a supervening event that would allegedly make the
execution of the writ absurd, as FBCI alleges it now owns the controlling interest in Esses
and Tri-Star. The RTC lifted the suspension of the writ but it cancelled the hearings on the
supervening event to give way to the Court of Appeals' action on this issue.

Silverio, Jr., Esses and Tri-Star argue that the RTC has no power to conduct hearings on the
supervening event because res judicata has set in on the issue. They also contend that the
supervening event is an intra-corporate controversy that is within the jurisdiction of the
Securities and Exchange Commission, not the trial court. Silverio, Jr., Esses and Tri-Star point
out that despite the lifting of the suspension RTC has still to execute the writ of possession in
their favor. On the other hand, FBCI maintains that its acquisition of Esses and Tri-Star is a
supervening event, which the RTC could hear and is sufficient ground to stay the execution
of the writ of possession.

97