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SUBSTANTIAL REQUIREMENTS OF PLEADINGS
SUFFICIENCY OF ALLEGATIONS
ULTIMATE FACTS
REMITERE ET AL. V. REMEDIOS MONTINOLA VDA. DE YULO
GR NO. L-19751 FEBRUARY 28, 1966.
Facts:
Remitere et al. filed a complaint against Remedios vda de Yulo and the
Register of deed of Negros occidental. The allegations are quoted below:
3. Upon the demise of Gregorio Remitere on January 1, 1914, the
Court of First Instance of Negros Occidental, in Civil Case No. 1661,
Re-Application for Letters of Administration, appointed his wife as
administratrix of his estate, among which are the two lots in
question.
During this period, the provincial sheriff of Negros Occidental
conducted a public auction sale over the said parcels of land, and on
the same day, September 23, 1918, he issued thereof a deed of sale
in favor of Mariano Yulo of Binalbagan, Negros Occidental, for the
total consideration of P20,000.00. Copy of the deed of sale is
herewith attached as Annex "C" and formed part of this complaint.
5. The public sale mentioned in Article 3 of this complaint, however,
was and still is absolutely a void sale, and certainly did not pass titles
and ownership of said lots, starting from its primitive owner, now
being represented by the plaintiffs herein, as surviving heirs thereto,
until it reaches the possession by the defendant.
That by reason of its invalidity, all and every benefits that the
transferees, including the defendant herein, had acquired from the
parcels of land in question, should be indemnified to the plaintiffs.
1
On the basis of these allegations, Remitere et al prays that Vda de Yulo and
the Register of deeds be ordered to reconvey the two (2) lots in question in their
favour, or order the cancellation of titles in the name of Remedios. Remedios Vda
de Yullo filed a motion to dismiss on the ground that the complaint did not state a
cause of action, or even assuming it exists, the same has already prescribed. The
RTC dismissed the complaint.
Issue:
Was the lower court correct in dismissing the complaint?
Held:
Yes.
1. The allegations as stated in [3] are mere averments or recitals of facts
that do not establish any right or claim on the part of Remitere et al. The
allegations do not state any connection that they have with Gregorio
Remitere or do they state what connection or claim they have with
Gregorio Remiteres properties.
2. The allegation about the sale at public auction does not state in what
way the right or interests of Remitere et al had been affected, nay
prejudiced by the sale.
a. [5] or any other part of the complaint do not state why the sale
at public auction was absolutely void nor where there any
particular facts or circumstances upon which the alleged nullity
of the sale or transaction is predicated.
b. The averment that the public sale. was and still is absolutely a
void sale, and certainly did not pass titles and ownerships of
said lots, starting from its primitive owner, now being
represented by plaintiffs therein, as surving heirs thereto is a
conclusion of law or an inference from facts not stated in the
pleading.
3. not being statements of ultimate facts which constitute the basis of a
right of Remitere et al, nor are they statements of ultimate facts which
constitute the wrongful acts or omissions of Remedios Vda De Yulo that
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violated their right, the allegations of the complaint failed to comply with
the following requirement :
the complaint should contain a concise statement of the
ultimate facts constituting the plaintiffs cause or causes of
action.
Notes:
1. A pleading should state the ultimate facts essential to the rights of action
or defense asserted, as distinguished from mere conclusion of fact or
conclusion of law.
a. an allegation that a contract is valid, or void, as in the instant
case, is a mere conclusion of law.
2. Ultimate facts are:
a. the essential facts constituting the plaintiffs cause of action. A
fact is essential if it cannot be stricken out without leaving the
statement of the cause of action insufficient;
b. Are important and substantial facts which either directly form
the basis of the primary right and duty, or which directly make
up the wrongful acts or omissions of the defendant.
c. Not the details of probative matter or particulars of evidence by
which these material elements are to be established.
d. The principal determinate constitutive facts, upon the existence
of which, the entire cause of action rests. [Montemayor vs.
Raborar, et al., 53 O.G. No. 19, p. 6596, citing Pomeroy, Code
Remedies, 5th Ed., sec. 420].
PHILIPPINE STOCK EXCHANGE V. MANILA BANK
GR NO. 147778 JULY 23,2008.
Facts:
The dispute was over a seat in the Manila and Philippine Stock
Exchanges. Recio used to own Seat No. 97. The seat was acquired by TMBC in
satisfaction of the debts Recio incurred with them. MSE refused to register TMBC
in its books as its by-laws allow only individuals or corporations engaged primarily
2
engaged in the business of stocks i.e. stock, bond brokers, dealers in securities, to
be a member of or hold a seat in MSE. Before MSE recognized TMBC as owner of
Seat No. 97, MSE unified with Makati Stock Exchange to form the PSE. Believing
that MSE Seat no. 97 became PSE seat No. 29, since Mr. Recio was issued a
certificate of membership based on his previous stake in MSE, TMBC sought to
claim its proprietary rights over PSE seat No 29. PSEi refused to recognize TMBCs
efforts, notwithstanding MSEs acknowledgement of legal ownership or naked title
over Seat 27.
TMBC filed a petition for mandamus with a claim for damages at the SEC
SICD. PSE filed a motion to dismiss the petition, but was met with a denial. After
the denial of PSEs motion for reconsideration on the order denying its motion to
dismiss, PSE elevated the case to SEC en banc by way of petition for certiorari.
SEC en banc denied the petition. PSE filed a petition for review before the CA,
which also denied the same. The motion for reconsideration had been denied by
CA as well.
Issue:
Did SEC en banc committed an error when it sustained SICD Hearing Panels
denial of PSEs motion to dismiss?
Held:
No. the SEC en banc correctly sustained the SICD hearing Panels denial of motion
to dismiss. The allegations in the mandamus petition sufficiently stated a cause of
action against the petitioners. The factual issues of the case are not merely
confined to the question of membership, but also to the existence of the devices
and schemes amounting to fraud as alleged by TMBC.
1. There are factual issues which should be discussed in the answer and
ventilated during the trial on the merits i.e. transferor of MSE was a PSE
member, and
2. the allegations supporting the allegations regarding bad faith and fraud
against PSE.
Verily, the complaint should contain a concise statement of ultimate facts. Ultimate
facts refer to the principal, determinative, constitutive facts upon which rest the
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existence of the cause of action. The term does not refer to details of probative
matter or particulars of evidence which establish the material elements.
Tests of sufficiency of complaint
PBCOM V TRAZO
GR NO. 165500 AUGUST 30,2006
Facts:
PBCOM and Trazo opened a payroll account with China Banking
Corporation. De La Rosa, PBCOM Assistant vice president, instructed CBC to credit
all accounts under its payroll, with the medical and clothing subsidy for the year
1998. Trazos current account was credited on that date with the amount of
P7000.00 for such subsidy. Trazo resigned on December 31 1997. Due to this
development, Dela Rosa wrote a letter to William Lim, CBC senior assistant vice
president, authorizing CBC/Lim to debit the sum P 7000.00 from Trazos current
account. When Trazo drew the checks against her current account in favour of
Bliss development and the House of Sara Lee, the checks were dishonoured due to
insufficiency of funds. Trazo filed an action for damages before the trial court.
CBC and Lim filed a motion to dismiss stating that the complaint failed to state a
cause of action. The motion to dismiss was granted. The Court of Appeals reversed
the decision and reinstated the complaint. Motions for reconsideration had been
denied by the Court of Appeals.
Issue:
Notes:
Does the complaint have a cause of action?
Held:
Yes.
1. contrary to the notion that the cause of action is found exclusively in par
13 of the complaint, an examination of the complaint reveals that it
contains other provisions establishing the cause of action against PBCOM
and Dela Rosa i.e. par 23:
3
23. In debiting the checking/current account of the plaintiff,
without her knowledge, consent and approval, defendants acted
in a wanton, reckless and oppressive manner. Defendants
PBCOM and ROMEO G. DE LA ROSA had no cause nor reason to
unilaterally order the debiting of plaintiffs account as it was her
personal property and not of defendant PBCOM.
The complaint also claims that the actions of defendants caused mental
anguish, moral shock, besmirched reputation, social humiliation, serious
fright, anxiety, sleepless nights and wounded feelings [ Annex K which
integrates Par. 20].
2. The cause of action stated in the Complaint, therefore, consists in (1) a
right in favor of the plaintiff, which in this case consists of a right to her
personal property;[32] (2) an obligation on the part of the named
defendant to respect her right to her personal property; and (3) an act of
such defendant violative of the right of the plaintiff, which in this case is
the order by petitioners to CBC and Lim to debit respondent Trazos
account, an act which petitioners allege to have caused them damage.
a. the complaint provides that PBCOM and Dela Rosa had no cause
nor reason to unilaterally order the debiting of Trazos account
as it was her personal property and not of PBCOM.
b. the complaint also describes action of all defendants unjust and
illegal and done in a wanton, reckless and oppressive manner.
1. A cause of action is an act or omission of one party in violation of the
legal right of the other.[19]
a. A motion to dismiss based on lack of cause of action
hypothetically admits the truth of the allegations in the
complaint.[20]
b. The allegations in a complaint are sufficient to constitute a cause
of action against the defendants if, hypothetically admitting the
facts alleged, the court can render a valid judgment upon the
same in accordance with the prayer therein. A cause of action
exists if the following elements are present, namely:
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i. a right in favor of the plaintiff by whatever means and
under whatever law it arises or is created;
ii. an obligation on the part of the named defendant to
respect or not to violate such right; and
iii. an act or omission on the part of such defendant
violative of the right of the plaintiff or constituting a
breach of the obligation of the defendant to the plaintiff
for which the latter may maintain an action for recovery
of damages
2. To sustain a motion to dismiss for lack of cause of action, the Complaint
must show that the claim for relief does not exist rather than that a claim
has been defectively stated or is ambiguous, indefinite or uncertain.
3. The complaint should state only ultimate facts, not conclusions of law, nor
evidentiary facts.
a. In determining whether the allegations of a complaint are
sufficient to support a cause of action, the complaint does not
have to establish or allege the facts proving the existence of a
cause of action at the outset; this will have to be done at the
trial on the merits of the case. [41]
b. Ultimate facts refer to the principal, determinative, constitutive
facts upon the existence of which the cause of action rests. The
term does not refer to details of probative matter or particulars
of evidence which establish the material ingredients.
DENIAL OF MATERIAL ALLEGATIONS, LEST DEEMED ADMITTED
SPS GAZA ET AL V LIM
GR NO. 126863 JANUARY 16, 2003
Facts:
Ramon and Agnes Lim filed with MTC an action for forcible entry against
sps Gaza. Sps Gaza filed with the same court their answer with compulsory
counterclaim. MTC dismissed the complaint and the counterclaim. On appeal, RTC
affirmed the MTC decision. Ramon and Agnes Lim filed with the CA a petition for
review. CA reversed the lower courts decision. The Court of Appeals averred that
since Sps Gaza did not deny specifically in their answer the allegations in the
4
complaint, they judicially admitted that Ramon and Agnes Lim were in prior
physical possession of the subject property, and the action for forcible entry which
they filed against spouses Gaza must be decided in their favor. The defense of Sps
Gaza that they are the registered owners of the subject property was found to be
unavailing. CA ordered Sps Gaza et al to vacate the premises and surrender its
possession to the Lims. The denial of the motion for reconsideration of Sps Gaza
led them to file with the Supreme Court a petition for review.
Issue:
1. Did the answer filed by Sps Gaza specifically deny the material averments
in Lims complaint?
2. did Sps Gaza impliedly admit Lims allegation that they have prior and
continuous possession of the property?
Held:
1. Yes. Sps Gaza were able to specifically deny the allegations contained in
Par 2 and 3 of the complaint that respondents have prior and continuous
possession of the disputed property.
2. That defendants specifically deny the allegations in paragraph
2 and 3 of the complaint for want of knowledge or information
sufficient to form a belief as to the truth thereof, the truth of the
matter being those alleged in the special and affirmative
defenses of the defendants
Sps Gaza did not merely allege that they have no knowledge or
information sufficient to form a belief as to truth of those allegations in
the complaint but added Special and Affirmative defenses in their
answer:
SPECIAL AND AFFIRMATIVE DEFENSES
5. that the complaint states no cause of action
From the allegations of plaintiffs, it appears that their possession of the
property was not supported by any concrete title or right,, nowhere in
the complaint that they alleged either as an owner or lessee, hence the
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alleged possession is questionable in all respects Defendants Sps.
Napoleon Gaza and Evelyn Gaza being the registered owner of the
subject property has all the right to enjoy the same, to use it, as an
owner xxx
6. That considering that the above-entitled case is an ejectment case,
and considering further that the complaint did not state or there is no
showing that the matter was referred to a Lupon for conciliation under
the provisions of P.D. No. 1508, the Revised Rule on Summary Procedure
of 1991, particularly Section 18 thereof provides that such a failure is
jurisdictional, hence, subject to dismissal
7. That the Honorable Court has no jurisdiction over the subject of the
action or suit;
The complaint is for forcible entry and the plaintiffs were praying for
indemnification in the sum of P350,000.00 for those copra, lumber, tools,
and machinery listed in par. 4 of the complaint and P100,000.00 for
unrealized income in the use of the establishment, considering the
foregoing amounts not to be rentals, Section 1 A (1) and (2) of the
Revised Rule on Summary Procedure prohibits recovery of the same,
hence, the Honorable Court can not acquire jurisdiction over the same.
2. Par2 and the special and affirmative defenses contained in Sps Gazas
answer show that they did not admit impliedly that Lims have been in
prior and physical possession of the property. Actually, Sps Gaza are
repudiating vehemently Lims possession, stressing that they are the
registered owners and lawful occupants of the premises.
Sps Gaza enumerated their special and affirmative defenses in
their answer. They also specified therein each allegation in the
complaint being denied by them. They particularly alleged they are the
registered owners and lawful possessors of the land and denied having
wrested possession of the premises from the respondents through force,
intimidation, threat, strategy and stealth. They asserted that respondents'
purported possession is "questionable from all aspects." They also
averred that they own all the personal properties enumerated in
respondents' complaint, except the two carabaos. Indeed, nowhere in the
answer can we discern an implied admission of the allegations of the
5
complaint, specifically the allegation that Sps Gaza have priority of
possession.
Notes:
1. Material averments in the complaint, other than those as to the amount
of liquidated damages, shall be deemed admitted when not specifically
denied.
2. Three (3) modes of specific denial are contemplated by the Sections 10
and 11 of Rule 8 of the 1997 Rules of Civil Procedure, namely:
a. by specifying each material allegation of the fact in the
complaint, the truth of which the defendant does not admit, and
whenever practicable, setting forth the substance of the matters
which he will rely upon to support his denial;
b. by specifying so much of an averment in the complaint as is true
and material and denying only the remainder;
c. by stating that the defendant is without knowledge or
information sufficient to form a belief as to the truth of a
material averment in the complaint, which has the effect of a
denial.
TESTS TO DETERMINE THE NATURE OF THE COUNTERCLAIM
NAMARCO MARKETING CORPORATION V FEDERATION OF UNITED NAMARCO
DISTRIBUTORS
GR NO. L-22578 JANUARY 31, 1973.
Facts:
Namarco instituted a civil case alleging that the federations act or
omission in refusing to satisfy Namarcos claim in its previous cases filed
against federation has compelled it to come to court for litigation.
Federation moved to dismiss the complaint on the ground that it does not
state a cause of action. The lower court granted the motion. It also held
that Namarcos claim is not a compulsory counterclaim, which should
have been raised in the previous cases.
Issues:
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2.
1. Is Namarcos compulsory, hence barred for failing to raise it by of a
defense or counterclaim in the previous case?
2. will Namarcos action for the collection of the payment of merchandise
delivered to, but not yet paid by, the federation, be barred as a
consequence of its failure to set it up as a counterclaim?
Held:
1. Namarcos claim is not compulsory, hence not barred.
a. While the refusal of NAMARCO to deliver the remainder of the
goods contracted for in its "trade assistance agreement" with
FEDERATION, is the important link in the chain of facts and
events that constituted the transaction upon which Federation's
cause of action was based in Civil Case No. 42684, it is not
even a part of the transaction constituting the subject
matter of NAMARCO's present suit.
b. For the action of FEDERATION on March 2, 1960, to compel
NAMARCO to recognize the validity of their agreement and
deliver the remainder of the goods to be paid "on cash basis" in
no way involved the payment of the merchandise worth
P609,014.73, already delivered and paid for in cash by means of
the domestic letters of credit.
c. When the domestic letters of credit were subsequently
dishonored by the Philippine National Bank on May 19, 1960
compelling NAMARCO to send on June 7, 1960 a letter of
demand for payment to FEDERATION which the latter received
on July 5, 1960, but which it apparently ignored and because of
such inaction NAMARCO therefore sued FEDERATION for
payment on January 25, 1961, such non-payment by
FEDERATION was a matter which was distinct and
separate from and had no logical relationship with the
subject matter of FEDERATION's own suit. These two
claims are separate and distinct, as they involve totally
different factual and legal issues and do not represent
the same "basic controversy"
6
No. Namarcos present action is barred by its failure to assert it as a
counterclaim in the previous case.
a. Even assuming that Namarcos claim is logically related to the
claim of the federation in the previous case, Namarcos claim
having accrued or matured after the service of its answer in the
earlier case is in the nature of an after-acquired
counterclaim, which is not barred even it is not set up in the
previous case as a counterclaim.
i. An after-acquired counterclaim, is one of the
recognized exceptions to the general rule that a
counterclaim is compulsory and must be asserted if
it arises out the same transaction as the opposing
partys claim.
1. if P sues A and A does not have a claim
arising out of the transaction or
occurrence of P's suit at the time A files
his answer A is not obliged to plead such
a claim, although one arises subsequent
to the filing of his answer.
b. A party who fails to interpose a counterclaim although arising
out of or is necessarily connected with the transaction or
occurrence of the plaintiff's suit but which did not exist or
mature at the time said party files his answer is not thereby
barred from interposing such claim in a future litigation.
ii. The counterclaim must be existing at the time of
filing the answer, though not at the
commencement of the action.
1. The counterclaim or cross-claim which a
party may aver in his answer must be one
which he may have at the time against
the opposing party. The phrase can only
have reference to the time of the answer.
2. A premature counterclaim cannot be set
up in the answer.
c. However such claim may with the court's permission be included
in the same case by way of supplemental pleading before
judgment under Section 4 of the former Rule 10 of the Rules
(now Sec. 9 of Rule 6). And the same may be allowed unless the
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case has progressed so far that it may be inconvenient or Would res judicially recognized by some courts as
confusing to allow the additional claim to be pleaded. judicata bar a "the acid test" for distinguishing
subsequent suit on compulsory from permissive
Notes: defendant's claim counterclaim.
absent the
compulsory Inadequate as an overall standard.
1. counterclaim not set up shall be barred if the following circumstances
counterclaim rule?
are present:
Will substantially the It is considered satisfactory if used with
a. that it arises out of, or is necessarily connected with, the
same caution. A test based on similarity of
transaction or occurrence that is the subject matter of the
evidence support or evidence appears reasonable
opposing party's claim
refute plaintiff's claim considering that the very purpose of
b. that it does not require for its adjudication the presence of
as well as defendant's making certain types of counterclaims
third parties of whom the court cannot acquire jurisdiction;
counter-claim? compulsory is to prevent the re-
and
litigation of the same set of fact.
c. that the court has jurisdiction to entertain the claim.
Is there any logical The fourth test ... the logical
2. A counterclaim is merely permissive and hence is not barred if not
relation between the relationship between the claim and
set up, where it has logical relation with the transaction or
claim and the counterclaim has been called "the one
occurrence that is the subject matter of the opposing party's claim,
counter-claim, such compelling test of
or even where there is such connection, the court has no jurisdiction
that the conduct of compulsoriness" .
to entertain the claim or it requires for its adjudication the presence
separate trials of the
of third persons of whom the court cannot acquire jurisdiction.
respective claims of Under this test, any claim a party has
3. Wright & Miller in their federal practice and procedure summarizes
the parties would against an opposing party that
the following tests:
entail a substantial is logically related to the claim being
duplication of effort asserted by the opposing party and
Are the issues of It assumes that, in order to protect and time by the that is not within the exceptions to the
fact and law raised by himself from inadvertently losing the parties and court? rule, is a compulsory counterclaim. Its
the claim and right to present his claim in a later
outstanding quality is its flexibility. On
counterclaim largely action, defendant will be both
the other hand this flexibility
the same? motivated and able to determine before
necessarily entails some uncertainty in
answering whether his claim must be
its application because of its looseness
asserted as a compulsory counterclaim.
and potentially over broad scope.

No one can be certain what the issues MANUEL C. BUNGCAYAO V. FORT ILOCANDIA
are until after the pleadings are closed GR NO. 170483 APRIL 19, 2010.
and discovery is underway, and in
many instances the issues are not Facts:
really formulated until the pre-trial
conference.

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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 petitioners 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.
Fort Ilocandia 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. Fort Ilocandia waived and
renounced the third counterclaim for damages.[19] The only counterclaim that
remained was for the recovery of possession of the subject property.
Issue:
1. Is Fort Ilocandias claim compulsory in nature?
2. Is the rulling of lower court as regards the second counterclaim
valid?
Held:
1. No. Fort Ilocandias remaining counterclaim is only a permissive
counterclaim. While counterclaim for the recovery of possession of the
subject property 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. It is capable of proceeding
independently of the main case.
LCD: What is missing to make the counterclaim compulsory is [b. would
res judicata bar a subsequent a subsequent suit of defendants claim,
absent the compulsory rule].
8
2. No. It is void for non payment of docket fees.
a. The rule in permissive counterclaim is that for the trial court to
acquire jurisdiction, the counterclaimant is bound to pay the
prescribed docket fees.[20]
b. Any decision rendered without jurisdiction is a total nullity and
may be struck down at any time, even on appeal before this
Court.[21]
c. 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[22] without prejudice to a separate action which
respondent may file against petitioner.
CALIBRE TRADERS V. BAYER PHILIPPINES
GR NO. 161431 OCTOBER 13, 2010
Facts:
Calibre had a distributorship agreement with Bayer Philippines effective
until june 1991. Bayer stopped delivering new stocks of agricultural chemicals on
July 1989, after calibre failed to setlle its unpaid accounts that totalled to P1, 751,
064.56. Calibre withheld payment to compel Bayer Phils to reconcile the
entitlements and discounts. Parties failed to reconcile these accounts. Calibre
filed a suit for damages before RTC. In its answer with counterclaim, bayer Phil
denied the alleged wanton appointment of other distributors as it cannot be
faulted for treating paying dealers and non-paying dealers such as Calibre
differently. It further asserted that it had to refuse further supply of its products,
as the stock on credit remained unpaid.
Bayer moved that Sps Sebastains be impleaded as co-defendants, as they made
themselves solidarily liable with Calibre under the distributorship agreement.
Calibre opposed as the spouses are not parties to this suit. It also stressed that the
issues between suit for damages and Bayers counterclaim for collection of money
are unrelated.
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RTC rejected bayers claim to implead the Sps in the counterclaim. Sps
filed their answer in response to Bayers counterclaim, which apart from adopting
the defenses of calibre, it argued that the counterclaim filed against them is
permissive. As Bayer failed to pay the docket fees due the permissive
counterclaim, the court did not have jurisdiction over the counterclaim. RTC
dismissed bayers counterclaim, citing calibres right to withhold payment in light of
the deliberate inaction of Bayer which are violative of art 19, 20, 28 of the Civil
code, the lack of valid demand and for failure of Bayer to pay the requisite docket
fees due as regards permissive counterclaims. CA reversed the lower courts
ruling. It classified bayers counterclaim as compulsory, as it arose out of the same
dealership agreement from which the claim off calibre is based. Since it is a
compulsory counterclaim, it need not pay the docket and filing fees.
Issue:
1. Is Bayers counterclaim compulsory?
2. was the dismissal of Bayers counterclaim proper?
Held:
1. No. bayers counterclaim is permissive.
a. Bayerphils suit may independently proceed in a separate
action. Although the rights and obligations of the parties are anchored
on the same contract, the causes of action they filed against each other
are distinct and do not involve the same factual issues.
b. there is no logical relationship between the two actions in a way that the
recovery or dismissal of plaintiffs suit will establish a foundation for the
others claim.
i. The counterclaim for collection of money is not intertwined
with or contingent on Calibres own claim for damages, which
was based on the principle of abuse of rights.
c. Both actions involve the presentation of different pieces of evidence.
i. Calibres suit had to present evidence of malicious intent, while
ii. Bayerphils objective was to prove nonpayment of purchases.
d. The allegations highlighting bad faith are different from the transactions
constituting the subject matter of the collection suit.
9
2. No, the dismissal is not proper. All along, Bayerphil has never evaded payment of
the docket fees on the honest belief that its counterclaim was compulsory. It has
always argued against Calibres contention that its counterclaim was permissive
ever since the latter opposed Bayerphils motion before the RTC to implead the
Sebastian spouses. Lastly, Bayerphils belief was reinforced by Judge Claravalls
October 24, 1990 Resolution when she denied Calibres motion to strike out
Bayerphils counterclaim. although the payment of the prescribed docket fees is a
jurisdictional requirement, its non-payment should not result in the automatic
dismissal of the case provided the docket fees are paid within the applicable
prescriptive period.
JUDICIAL AFFIDAVIT RULE
Scope and where applicable
The Judicial Affidavit rule applies to all actions and proceedings and incidents
requiring the reception of evidence before the courts, quasi-judicial bodies, whose
rules of procedure are subject to disapproval of the Supreme Court, insofar as their
existing rules of procedure contravene the provisions of this Rule, and
investigating officers and bodies authorized by the Supreme Court to receive
evidence, including the IBP.
Contents and procedure
Contents
A judicial affidavit shall be prepared in the language known the witness and, if not
in English or Filipino, accompanied by a translation in English or Filipino, and shall
contain the following:
1. the name, age, residence or business address and occupation of the
witness;
2. the name and address of the lawyer who conducts or supervises the
examination of the witness and the place where the examination is being
held;
3. a statement that the witness is answering the questions asked of him,
fully conscious that he does so under oath, and that he may face criminal
liability for false testimony or perjury;
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4. questions asked of the witness and his corresponding answers, witnesses, which shall take the
consciously numbered, that: place of such witnesses
a. show the circumstances under which the witness acquired the testimonies;
facts upon which he testifies; b. The parties documentary or
b. elicit from him those facts which are relevant to the issues that object evidence, if any, which
the case presents; shall be attached to the judicial
c. identify the attached documentary and object evidence and affidavits and marked as
establish their authenticity in accordance with the Rules of Court. exhibits.
5. the signature of the witness over his printed name; 2. Should a party or witness desire to keep
6. a jurat with the signature of the notary public who administers the oath the original document or object evidence
or an officer who is authorized by law to administer the same. in his possession, he may, after the same
has been identified, marked as exhibit,
Sworn Attestation of the Lawyer and authenticated, warrant in his judicial
affidavit that the copy or reproduction
The judicial affidavit shall contain a sworn attestation at the end, executed by the attached to such affidavit is a faithful
lawyer who conducted or supervised the examination of the witness, to the effect copy or reproduction of that original.
that: 3. The party or witness shall bring the
original document or object evidence for
1. he faithfully recorded or caused to be recorded the questions he asked comparison during preliminary
and the corresponding answers the witness gave; conference with the attached copy,
2. neither he nor any other person then present or assisting him coached reproduction or pictures, failing which the
the witness regarding the latters answers. latter shall not be admitted.
Step 2. Trial commences.
What is the consequence of a false attestation?
1. the party presenting the judicial affidavit
A false attestation shall subject the lawyer mentioned to disciplinary action, of his witness in place of direct testimony
including disbarment. shall state the purpose of such testimony
at the start of the presentation of the
Procedure witness;
2. the adverse party may move to disqualify
Step 1. 1. The parties shall file with the court and the witness or to strike his affidavit or his
serve on the adverse party personally or judicial affidavit or any of the answers
by licensed courier service, not later than found in it on the ground of
five (5) days before the pre-trial or inadmissibility.
preliminary conference or the scheduled a. The court shall promptly rule on
hearing with respect to the motions and the motion and if gratned, shall
incidents: cause the marking of any
a. The judicial affidavits of their excluded answer by placing it in

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brackets under the initials of an

authorized court personnel, Non-compliance Effect
without prejudice to the tender Failure to submit the It is deemed a waiver of the
of excluded evidence under sec required judicial submission.
40 Rule 142. affidavits and exhibits on
3. the adverse party shall have the right to time However,, the court may
cross-examine the witness on his judicial allow only once the late
affidavit and on the exhibits attached to submission provided:
the same. 1. the delay is for a
4. the party who presents the witness may valid reason;
examine him on re-direct. 2. submission would
not unduly prejudice
Note: In every case, the court shall active part in the opposing party;
examining the witness to determine his credibility 3. the defaulting party
as well as truth of his testimony and to elicit pays a fine of not
answers that it needs in resolving the issues. less than Php
Step 3. upon the termination of the testimony of his last 1,000.00 but not
witness, a party shall make an oral offer of more than Php
documentary evidence, piece by piece, in their 5,000.00 at the
chronological order, stating the purpose or Courts discretion
purposes for which he offers the particular exhibit Failure to appear at the The court shall not consider
Step 4. After each piece of exhibit is offered, the adverse scheduled hearing of the the affidavit of any witness
party shall state the legal ground for his objection, case as required
if any to its admission, and the court shall Failure of counsel to It is deemed a waiver of his
immediately make its rule respecting that exhibit. appear without valid clients right to confront by
cause despite notice cross-examination the
Application of criminal actions witnesses there present
Judicial affidavits do not the court shall not admit as
The rule shall apply to all criminal actions: conform to the content evidence judicial affidavits.
requirements and
1. where the maximum of the imposable penalty does not exceed six (6) attestation requirements However,, the court may
years; allow only once the late
2. where the accused agrees to the use of judicial affidavits, irrespective of submission provided:
the penalty involved; 4. the delay is for a
3. with respect to the civil aspect of the actions, whatever the penalties valid reason;
involved are. 5. submission would
not unduly prejudice
Effect of non-compliance the opposing party;

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the defaulting party pays a However, LZK filed with the RTC a complaint for annulment of the
fine of not less than Php extrajudicial foreclosure, mortgage contract, promissory notes and for damages.
1,000.00 but not more than LZK Just before the scheduled pre-trial, LZK filed a motion for leave to file a
Php 5,000.00 at the Courts supplemental complaint to cover occurrences subsequent to the original complaint.
discretion It alleged that after the filing of the original complaint, the bank agreed in principle
to enter into a contract of lease with a prospective lessee, AMA Computer College
Effect on other rules over three floors of the building. AMA required the bank to secure Planters
consent. Planters gave unreasonable conditions before it gives its consent. This
1. As to Rules of Court and rules of procedure governing investigating prompted AMA to back-out from the contract. LZK averred that until title to
officers and bodies authorized by the Supreme Court to receive evidence, property had been consolidated to planters, LZK remained the owner of the land,
they are repealed or modifies insofar as they are inconsistent with the thus entitled to exercise all attributes of ownership. LZK pointed out that Planters
provisions of the judicial affidavit rule. had no authority to collect the rentals, because the promissory notes, the real
2. As to Rules of Procedure governing quasi-judicial bodies which are estate mortgage and the foreclosure were being put into question before the
inconsistent with it, they are thereby disapproved. court.
Planters opposed the supplemental complaint. It argued that what goes
AMENDED AND SUPPLEMENTAL PLEADINGS its admission is the fact that the supplemental matters involved therein would
bring the case to new causes of action, distinct and separate from those
PRINCIPLE: mentioned in the original complaint. The trial court issued an order admitting the
supplemental complaint. Upon denial of planters motion for reconsideration, it
WHEN ISSUES ARE JOINED, SUBSTANTIAL AMENDMENTS ARE DISCRETIONARY AND SUBJECT filed a petition for certiorari before the Court of Appeals. However, the appellate
TO THE RULE THAT THE CAUSE OF ACTION SHOULD NOT BE SUBSTANTIALLY CHANGED OR court rendered its decision finding that trial court did not commit grave abuse of
THEORY ALTERED. discretion when it admitted the supplemental complaint. It averred that the LZK
demonstrated the connection between the original complaint and the supplemental
PLANTERS DEVELOPMENT BANK V. LZK HOLDINGS AND DEVELOPMENT CORPORATION complaint.
GR NO. 153777 APRIL 15,2005.
Issue:
Facts:
Did the trial court commit grave abuse of discretion in admitting the supplemental
LZK Holdings and Development and Planters entered into a loan complaint?
agreement, in which Planters extended a credit accommodation worth 40k to
finance the construction of a seven story building. LZ mortgaged the lot where that Held:
building was constructed and executed two (2) promissory notes to secure the
credit accommodation. It also assigned all the rental incomes from the building in
No. By its supplemental complaint, LZK merely enlarged its original causes of
payment of its obligations. For failure of LZK to pay the loan, Planters caused the
action on account of the events that transpired after the filing of the original
extrajudicial foreclosure of the lot. The lot was subsequently sold in favour of the
complaint and prayed for additional reliefs.
bank, having emerged as the highest bidder.

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1. The principal and core issues in the original complaint remained the
same.
a. The issue as to whether Planters stopped the payment of rentals
and application thereof to the perceived loan of LZK is a new
matter that occurred after the filing of the original complaint.
b. Relief for damages, the collection of rentals and the application
thereof by planters are germane to, and are in fact
intertwined with the cause of action nullifying the real estate
mortgage, extrajudicial foreclosure and sale of public auction.
c. Collection of unrealized income from AMA and dropping of
criminal complaint for falsification and perjury against Tividad an
officer of Planters, are likewise germane and related to LZKs
claim that it remained the owner of the property.
2. There is also no showing that Planters was unjustly prejudiced by the
admission of the supplemental complaint.
3. After all, planters has the right to file a supplemental complaint
comformably to Sec 7 Rule 11 of the Rules of Court.
4. the admission of the supplemental complaint better serve the ends of
justice.
Notes:
1. A supplemental pleading only serves to bolster or adds something to the
primary pleading. A supplemental pleading does not replace that which it
supplements.
2. A supplemental pleading assumes that the original pleading is to stand
and that the issues joined with the original pleading remained an issue to
be tried in the action.
a. It is but a continuation of the complaint
b. Its usual office is to set up new facts which justify, enlarge or
change the kind of relief with respect to the same subject matter as
the controversy referred to in the original complaint.
3. Any supplemental facts which further develop the original right of action
or extend the relief are available by way of supplemental complaint even
if through they themselves constitute a right of action.
13
4. The parties may file supplemental pleadings only to supply deficiencies
in aid of the original pleading, but not to introduce new and independent
causes of action.
c. When the cause of action stated in the supplemental complaint is
different from the causes of action mentioned in the original
complain, the court should admit the supplemental complaint.
d. While a matter stated in a supplemental complaint should have
some relation to the cause of action set forth in the original
pleading, the fact that the supplemental pleading technically states a
new cause of action should not be a bar to its allowance but only a
factor can be considered by the court in the exercise of its
discretion; and of course, a broad definition of cause of action
should be applied here as elsewhere.
YOUNG V. SY
GR NO. 157745 SEPTEMBER 26, 2006.
Facts:
A complaint for nullification of second supplemental extrajudicial
settlement, mortgage, foreclosure sale and tax declaration had been filed by
Genalyn Young with the RTC. She alleged that:
1. the extra-judicial partition executed by her natural mother, Lilia Dy Young
which adjudicated an unregistered parcel of land solely in her favor is
unenforceable, since at the time of the execution, Genalyn was only 15
years old and no court approval had been procured;
2. the partition had been registered with the Register of Deeds; that Lilia
Dy obtained a loan from spouses Manuel Sy and Victoria Sy and
mortgaged the subject property;
3. that the property was foreclosed and sold to the highest bidder, Manuel
Sy;
4. a Certificate of Sale for this purpose had been registered with the
Register of Deeds;
5. Thereafter, Manuel and Victoria obtained in their name a tax declaration
over the property in question.
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Genalyn filed the RTC a Motion to admit the supplemental complaint,
where she invoked her right as co-owner to exercise legal redemption. RTC denied
the motion. This led her to file a petition for certiorari and mandamus before the
Court of Appeals. The Court of Appeals denied the petition, stating that the cause
of action in the supplemental complaint is entirely different from the original
complaint.
Issue:
1. Did the lower court and the Court of Appeals err in ruling that the
supplemental complaint constituted a substantial amendment of the
original?
2. is the reasoning that "[i]n the event that the lower court rules in favor of
Genalyn, then there is no need for her to file a petition to exercise the
right of redemption. On the other hand, should the trial court issue[ ] an
adverse ruling then petitioner can still appeal the same. The petition for
certiorari is therefore not proper." correct?
Held:
1. Yes.
a. the consolidation of title over the subject property in the name of
Manuel Sy and the issue as to whether it precluded petitioner as
alleged co-owner from exercising the right of legal redemption, are
new matters that occurred after the filing of the original
complaint.
i. The relief prayed for in the Supplemental Complaint, which
is the exercise of the right of legal redemption accorded to
co-owners of property, is germane to and intertwined
with the cause of action in the Complaint for the
nullification of the "Second Supplemental to the
Extrajudicial Partition" on the ground that it lacked the
approval of a guardianship court.
b. The Genalyn's right to redeem the property is dependent on the
nullification of the partition which is the subject of the original
complaint.
14
ii.Unless the partition is nullified or declared without any force
or effect, she will not be considered a co-owner of the
property
iii. Consequently, she will be unable to exercise any right of
legal redemption under Article 1620 23 of the Civil Code
granted to co-owners of property
c. The right of legal redemption as co-owner is conferred by law and is
merely a natural consequence of co-ownership.
iv. Hence, Genalyns cause of action for legal redemption as
embodied in her Supplemental Complaint stems directly
from and is an extension of her rights as co-owner of the
property subject of the Complaint
v. Furthermore, the evidence required to prove her right of
legal redemption in the Supplemental Complaint will be
exactly the same evidence required to prove the nullification
of the partition in the Complaint.
2. no.
a. even if the trial court decides in her favor, the redemption period
would have lapsed and would not form a part of the decision
since it was not prayed for, much less alleged in the original
complaint.
b. In such a case, sps Sy could oppose the exercise of the right to
redeem since it would not have been included in the decision
over the original complaint.
c. And should the trial court issue an adverse ruling, Genalyn can
only appeal what is included in the ruling which is limited to the
denial of the prayer for the nullification of the partition.
Naturally, such a decision would not concern any right of
redemption.
Note:
1. If a separate action is filed for the subject covered by the Supplemental
Complaint, there will be multiplicity of suits.
2. A supplemental complaint may be answered within ten (10) days from
notice of the order admitting the same, unless a different period is fixed
by the court.
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a. The answer to the complaint shall serve as the answer to the
supplemental complaint if no new or supplemental answer is
filed.
PHILIPPINE PORTS AUTHORITY V. WILLIAM GOTHONG & ABOITIZ
GR NO. 158401 JANUARY 28 2008
Facts:
WG& A commenced an injunction suit against PPA. It claimed the PPA
unjustly, illegally and prematurely terminated its lease contract. WG&A prayed for
the issuance of a TRO to arrest the evacuation. It amended it complaint,
incorporating its allegation that PPA is already estopped from denying that the
correct period of lease is until such time that the North Harbor Modernization
Project has been bidded out to and operations turned over the bidder. PPA also
added as its third cause of action, the additional relief in its prayer i.e. should
WG&A forced to vacate the property, it should be refunded of its improvements.
Not long after, WG&A filed a motion to attached second amended complaint. The
amended complaint prayed for reformation of contract.
PPA opposed, stating that the reformation sought for by WG &A
constituted a substantial amendment, which if granted, will substantially alter the
latters cause of action and theory of the case. The RTC denied the admission of
the Second amended complaint. Via petition for certiorari before the CA, WG&A
sought for the nullification of the orders of the RTC. CA granted the petition and
ordering the RTC to admit the second amendment complaint.
Issue:
Did RTC committed grave abuse of discretion when it denied the admission of the
second amended complaint?
Held:
Yes. The RTC applied the old Sec 3 Rule 10 of the Rules of Court. The RTC should
have applied the rule found in 1997 Rules of Civil Procedure stating that:
15
substantial amendments may be made only upon leave of court. But
such order may be refused if it appears to the court that the motion
was made with intent to delay.
The clear import of the amendment is that under the new rules, the amendment
may now substantially alter the cause of action or defense.
1. this should only be true, when despite change or alteration in the
cause of action or defense, the amendments sought to be made
shall:
a. serve the higher interests of substantial justice, and
prevent delay and
b. equally promote the laudable objective of the rules which
is to secure a just, speedy and inexpensive disposition of
every action or proceeding.
SUPPLEMENTAL PLEADINGS NOT A MATTER OF RIGHT
LEOBRERA V. CA
GR NO. 80001 FEBRUARY 27, 1989
Facts:
Leobrera filed a complaint for damages with prayer for the issuance of
writ of preliminary injunction seeking to enjoin BPI from foreclosing the mortgages
that secured BPIs credit facility and 90 day loans. The Trial Court issued an order
restraining BPI from foreclosing the lots. However, BPI found that Leobrera failed
to pay the amortization due on the three year term loans. BPI opted to accelerate
the loan and made it due and demandable.
Before BPI could even foreclose the mortgage, Leobrera filed a Motion to
file supplemental complaint, attaching thereto the supplemental complaint praying
for the issuance of another injunction to restrain BPI from foreclosing the third
mortgage. The trial court granted the motion and issued a restraining order. Upon
the denial of BPI motion to set aside the motion to admit supplemental complaint,
it filed a petition for certiorari before the CA. The appellate court declared the
rulings of the lower court null and void.
Issue:
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Did the lower court err in admitting the supplemental complaint?
Held:
Yes. What militates against its admission is the fact that the matters involved
therein are entirely different from the causes of action mentioned in the original
complaint.
1. Leobrera's main cause of action in the original complaint filed in
Civil Case No. 15644 concerned BPI's threat to foreclose two real
estate mortgages securing the two 90 day promissory notes
executed by petitioner in 1986. he
a. He alleges that this threatened foreclosure violated the terms
of the 1980 amicable settlement between BPI and petitioner.
2. The supplemental complaint on the other hand alleged acts of
harassment committed by BPI in unreasonably opting to declare
Leobrera in default and in demanding full liquidation of the 1985
three-year term loan.
a. This three-year term loan, as previously mentioned, was
entirely distinct and separate from the two promissory notes.
b. It was independent of the 1980 amicable settlement between
petitioner and BPI which gave rise to the credit facility subject
of the original complaint.
c. Although there is Identity in the remedies asked for in the
original and supplemental complaints, i.e. injunction,
petitioner's subsequent cause of action giving rise to the claim
for damages in the supplemental complaint is unrelated to
the amicable settlement which brought about the
grant of the credit facilities, the breach of which
settlement is alleged to be the basis of the original
complaint.
As the allegations reveal, the P 500,000.00 three-year term loan is a
transaction independent of the P 800,000.00 credit facility and BPI's questioned
act of threatening to foreclose the properties securing said loan was the result of
an alleged default by petitioner in the payment of the amortization due for 9
February 1987 and not because of any circumstance related to the 1980 amicable
16
settlement. The two causes of action being entirely different, the latter one could
not be successfully pleaded by supplemental complaint.
Notes:
1. A supplemental complaint should supply only deficiencies in aid of
an original complaint
2. It should contain only causes of action relevant and material to the
plaintiff's right and which help or aid the plaintiff's right or defense
3. The supplemental complaint must be based on matters arising
subsequent to the original complaint related to the claim or defense
presented therein, and founded on the same cause of action.
a. It cannot be used to try a new matter or a new cause of
action.
QUIRAO V. QUIRAO
GR NO. 148120 OCTOBER 24, 2003.
Facts:
Lydia and Leopoldo Quirao filed before the trial court a complaint for the
recovery of possession, ownership and damages with writ of Preliminary
Mandatory Injunction against Rodrigo, Monica, Roberto, Edilberto, Gerardo,
Federico all surnamed Quirao, Jesus Gole, Lamberto Valdez, and Avelino Ngitngit.
Lydia and Leopoldo alleged that Rodrigo et al forcibly took possession of the
sugarland, and appropriated themselves its income.
The case underwent pre-trial. Rodrigo et als second counsel filed an
amended pre-trial brief which reiterated the allegation that Lydia and Leopoldo
were not real parties in interest as they had sold the property to a certain Carlito
de Juan. Trial ensued.
After Rodrigo et al rested their case, Lydia and Leopoldo filed a motion for
leave of court to admit attached amended answer, adding the alternative defense
that even if Rodrigo et al were the owners of the property by inheritance from
Leopoldo, Rodrigo et al executed a deed of extra judicial partition of property with
sale in favour of de Juan. They point out that de Juan sold part of the property to
them. Rodrigo et al opposed the motion, averring that it is dilatory and that the
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amendments are substantial and cannot be allowed as all of them just finished the
pre-trial conference.
The motion to admit the attached amended answer was denied. The
lower court ruled that to do so would prejudice Rodrigo et a as they had already
rested their case and the alleged facts were already existing and known to Lydia
and Leopoldo when they filed their answer. The Court of Appeals dismissed the
petition filed by Lydia and Leopoldo, on the ground that the amendments are
basically the same issues raised in the motion to dismiss and are substantial ones
which may be properly refused.
Issue:
was the denial of the motion to attach amended answer proper?
Held:
No. Lydia and Leopoldos motion for admission of amended answer may be a little
tardy but this by itself is not a cause for its denial.
1. Their amended answer alleges that Rodrigo et al no longer own the
subject property having sold the same to de Juan who, in turn, sold
the property to them.
2. These allegations, if correct, are vital to the disposition of the case
at bar. The interest of justice and equity demand that they be
considered to avoid a result that is iniquitous. Truth cannot be
barred by technical rules.
3. For this reason, our ruling case law holds that amendments to
pleadings are generally favored and should be liberally allowed in
furtherance of justice so that every case may so far as possible be
determined on its real facts and in order to prevent the circuity of
action.
Notes:
1. The Rules of Court allow amendments of pleadings as a matter of right before
a responsive pleading is served; otherwise, leave of court must first be
obtained.[
17
2. Amendments to pleadings are favored and should be liberally allowed in
furtherance of justice.
a. This liberality is greatest in the early stages of a
lawsuit, decreases as it progresses, and changes at times
to a strictness amounting to a prohibition.
b. Amendments are likewise subject to the limitation
that they are not dilatory.[21]
c. Thus, trial courts are given the discretion to grant
leave of court to file amended pleadings, and their
exercise of this discretion will normally not be disturbed on
appeal, unless there is evident abuse thereof.
EFFECT OF AMENDED PLEADINGS
THE DIRECTOR OF LANDS V. COURT OF APPEALS
GR NO. L-314408 APRIL 22, 1991
Facts:
R. Borromeo Bros Estate Inc filed an action for confirmation and
registration of title in its favour a parcel of land fronting the coastal town of San
Isidro Leyte. This has been opposed by the Director of Lands and the Municipality
of San Isidro. The case was then heard. After R. Borromeo presented its evidence,
it sought and was allowed to amend its application, which originally alleged that
the land applied for had been formed of alluvium deposited by the action of the
sea. The amended application now states that the land had been formed instead
from accretion of soil and sediment carried from higher places by Si-ong and
Sinubdan lakes. The Trial Court ruled that the land is a public land. The CA
reversed the RTC, holding that it was a private land. The director of lands
questions the CA for not holding R Borromeo bound by its averment in its original
application that the land was a natural action of the sea.
Issue:
Was the CA correct in not holding R Borromeo bound by its averment in its original
application that the land was a natural action of the sea.
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Held:
Yes. It does not appear that the original application for registration containing the
averment in question, or that particular averment itself, was offered or received in
evidence for the petitioner in the Trial Court.
Note:
Pleadings that have been amended disappear from the record, lose their status as
pleadings and cease to be judicial admissions. While they may nonetheless be
utilized against the pleader as extra-judicial admissions, they must, in order to
have such effect, be formally offered in evidence. 21
SPS VICENTE AND ANITA DIONISIO V LINSANGAN
GR NO. 178159 MARCH 2, 2011.
Facts:
Dionisios filed an eviction suit against Wilfredo Cruz before the MTC of
San Rafael Bulacan. Wilfredo filed his answer with counterclaims. Wilfredo declared
that he had been a tenant since 1977. At the pre-trial, Dionisios orally asked for
leave to amend their complaint. Despite initial misgivings, Wilfredo asked for time
to respond to it. Dionisio was allowed to amend their complaint while Wilfredo
maintained its original answer. The MTC ruled in favour of Dionisios. RTC affirmed
the judgement. However, the Court of Appeals reversed the decisions of the lower
courts. It averred that by amending their complaint, Dionisios effectively changed
their cause of action from unlawful detainer to recovery of possession which fell
outside the jurisdiction of the MTC.
Issue:
Did Dionisios amendment of complaint effectively change their cause of action,
from one of ejectment to one of recovery of possession?
Held:
18
No.
1. Here, the original complaint alleges that:
the Dionisios bought the land from Cruz on September 30, 1989; that
Romualdo used to be the lands tenant; that when he died, the Dionisios
allowed his widow, Emiliana, to stay under a promise that she would
leave the land upon demand; that in April 2002 the Dionisios discovered
on visit to the land that Emiliana had left it and that Wilfredo now
occupied it under a claim that he bought the right to stay from Emiliana
under a "Kasunduan ng Bilihan ng Karapatan;" that the Dionisios did not
know of and gave no consent to this sale which had not been annotated
on their title; that the Dionisios verbally told Wilfredo to leave the
property by April 31, 2002; that their lawyer reiterated such demand in
writing on April 22, 2002; that Wilfredo did not heed the demand; that
the Dionisios wanted to get possession so they could till the land and
demolish Wilfredos house on it; that Wilfredo did not give the Dionisios
just share in the harvest; and that the Dionisios were compelled to get
the services of counsel for 100,000.00.
2. The amended complaint has essentially identical allegations.
The only new ones are that the Dionisios allowed Emiliana, Romualdos
widow to stay "out of their kindness, tolerance, and generosity;" that
they went to the land in April 2002, after deciding to occupy it, to tell
Emiliana of their plan; that Wilfredo cannot deny that Cruz was the
previous registered owner and that he sold the land to the Dionisios; and
that a person occupying anothers land by the latters tolerance or
permission, without contract, is bound by an implied promise to leave
upon demand, failing which a summary action for ejectment is the proper
remedy.
3. To determine if an amendment introduces a different cause of action, the
test is whether such amendment now requires the defendant to answer
for a liability or obligation which is completely different from that stated in
the original complaint.8
a. Here, both the original and the amended complaint required
Wilfredo to defend his possession based on the allegation that
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he had stayed on the land after Emiliana left out of the owners
mere tolerance and that the latter had demanded that he leave.
b. Indeed, Wilfredo did not find the need to file a new answer.
Note:
1. An amended complaint that changes the plaintiffs cause of action is
technically a new complaint.
a. Consequently, the action is deemed filed on the date of the filing
of such amended pleading, not on the date of the filing of its
original version.
2. Thus, the statute of limitation resumes its run until it is arrested by the
filing of the amended pleading.
3. The Court acknowledges, however, that an amendment which does not
alter the cause of action but merely supplements or amplifies the facts
previously alleged, does not affect the reckoning date of filing based on
the original complaint.
4. The cause of action, unchanged, is not barred by the statute of limitations
that expired after the filing of the original complaint
RESPONSIVE PLEADINGS
WHAT IS A RESPONSIVE PLEADING?
SPS VIRGILIO SANTOS ET.AL. V. SPS. LUMBAO
GR NOS. 169129 MARCH 28 2007
Facts:
On two separate occasions, Rita Santos, the predecessor of Santos et al,
sold a part of her inchoate share in the estate of her deceased mother, Maria. The
first sale was denominated Bilihan ng Lupa dated August 17 1979 [D1].
Sps Lumbao alleged that Virgilio and Tadeo Santos were present to witness the
sale. The second sale adding seven square meters was also denominated Bilihan
ng Lupa dated January 9, 1981 [D2]. Both sales were made in favour of Sps
Lumbao.
Sps Lumbao immediately took possession of the property. They also
claimed that they made several demands on Rita during her lifetime and upon
Santos et al to execute the documents necessary of the issuance of separate titles
in their favour. They also allege that Rita informed them that she cannot transfer
the titles yet as the property she had inherited from her mother was not yet
partitioned. Sps Lumbao accused the Santos et al for acting fraudulently in
executing the deed of extrajudicial settlement that included the land sold by Rita in
their favour.
Santos et al. filed their answer. In the answer and amended answer to
the complaint for reconveyance with damages, Virgilo and Tadeo admitted having
acted as witnesses in the execution of [D1]. Nonetheless, they denied that the
land had been sold in favour of Sps. Lumbao. They also denied that the
extrajudicial settlement had been done in bad faith as it had been duly published
as required by law. Sps Santos prayed for the dismissal of the action, for failure of
Sps Lumbao to resort to barangay conciliation.
Sps Lumbao, with leave of court, amended the complaint. They averred
that a real estate mortgage had been executed in favour of Esplana. The trial
court rendered its decision Santos et al had been ordered to pay Sps Lumbao
damages. Upon appeal, the CA reversed the lower courts decision and ruled in
favour of Sps. Lumbao.
Issue:
Are the answer filed by Santos et al binding upon them?
Held:
Yes.
1. Upon examination of the aforesaid documents, this Court finds that in the
Bilihan ng Lupa, dated 17 August 1979, the signatures of petitioners
Virgilio and Tadeo appeared thereon.
2. Moreover, in Santos et als Answer and Amended Answer to the
Complaint for Reconveyance with Damages, both petitioners Virgilio and

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Tadeo made an admission that indeed they acted as witnesses in the
execution of[ D1].
a. However, in order to avoid their obligations in the said Bilihan ng
Lupa, petitioner Virgilio, in his cross-examination, denied having
knowledge of the sale transaction and claimed that he could not
remember the same as well as his appearance before the notary
public due to the length of time that had passed.
b. Noticeably, petitioner Virgilio did not categorically deny having
signed the Bilihan ng Lupa,
3. Santos et al did not adduce any evidence to override the admission of
Virgilio and Tadeo that they signed the documents, except that they were
just misled as to the purpose of the document. Virgilio s answers in the
cross examination were unsure and quibbled.
4. both [D1] and [D2] were duly notarized before a notary public. Santos et
als denials without clear and convincing evidence to support their claim
of fraud and falsity were not sufficient to overthrow the presumption of
regularity; hence, the authenticity, due execution and the truth of the
facts stated in [D1] and [D2] are upheld.
Note:
1. As a general rule, facts alleged in a partys pleading are deemed
admissions of that party and are binding upon him, but this is not
an absolute and inflexible rule.
2. An answer is a mere statement of fact which the party filing it
expects to prove, but it is not evidence. [21]
3. And in spite of the presence of judicial admissions in a partys
pleading, the trial court is still given leeway to consider other
evidence presented.
4. a document acknowledged before a notary public is a public
document[25] that enjoys the presumption of regularity.
a. It is a prima facie evidence of the truth of the facts stated
therein and a conclusive presumption of its existence and
due execution.
b. To overcome this presumption, there must be presented
evidence that is clear and convincing.Absent such
evidence, the presumption must be upheld.[27]
20
c. In addition, one who denies the due execution of a deed
where ones signature appears has the burden of proving
that contrary to the recital in the jurat, one never
appeared before the notary public and acknowledged the
deed to be a voluntary act.
GARDNER V. CA
GR NO. L-59952 AUGUST 31, 1984.
Facts:
A chain of successive transfers of real property are involved. Aggrieved by
the series of transfers, the Gardners filed for a Declaration of Nullity, Rescission
and damages against the five transferees, praying for the declaration of nullity of
all the transfers and the cancellation of all titles issued on the ground that they
were all simulated, and without consideration.
Among the five transferees were the Santoses who claimed in their
answer that the sale was conditional i.e. properties were to be considered as the
investment of Gardners in the subdivision venture. They aver that in the event that
this did not materialize they were to convey the lots to the Gardners upon their
reimbursement of the advances made by Santoses. They also added that the deed
of sale was to be registered for their protection, given the sums of money they are
advancing.
The trial court ruled in favour of Gardners. On appeal before the Court of
Appeals, only the judgement against one of the transferees, Natividads was set
aside.
Issue:
Will the answer bind the Santoses?
Held:
No.
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1. the Second Transfer to the CUENCAS was fictitious and simulated for not
having been supported with any consideration.
a. By his own admission, Ariosto SANTOS transferred to the
CUENCAS, who are his "compadres", the disputed properties,
together with others that he owned, merely to conceal his
ownership and "to protect them from persons who had filed suits
against him and were running after the properties registered in
his name." It was SANTOS who had caused the execution of
those deeds of sale (Exhibits "H" & "I") and had them notarized
by his own counsel.
i. No wonder then that the CUENCAS did not even dispute
the validity of the adverse claim pursuant to Section
110 of the Land Registration Act, and during the trial
they merely adopted SANTOS' testimony.
ii. Under the circumstances surrounding their transaction
they knew that their title was flawed and they were
not, and cannot be considered, buyers in good faith,
having paid no consideration for the sale.
iii. The subsequent registration of the adverse claim on
their titles, therefore, could not but serve as notice and
warning to all subsequent buyers that someone was
claiming an interest in the properties or a better right
than the registered owners.
2. The Court of Appeals discredited the testimony of Ariosto SANTOS for
being at variance with the allegations in his Answer.
a. The fact, however, that the allegations made by Ariosto SANTOS
in his pleadings and in his declarations in open Court differed will
not militate against the findings herein made nor support the
reversal by the Court of Appeals.
b. As a general rule, facts alleged in a party's pleading are deemed
admissions of that party and binding upon it, but this is not an
absolute and inflexible rule. 22
i. An Answer is a mere statement of fact which the party
filing it expects to prove, but it is not evidence. 23
ii. As Ariosto SANTOS himself, in open Court, had
repudiated the defenses he had raised in his Answer
and against his own interest, his testimony is deserving
of weight and credence.
21
iii. Both the Trial Court and the Appellate Court believed in
his credibility and we find no reason to overturn their
findings thereon.
WHEN DO YYOU FILE YOUR RESPONSIVE PLEADING?
SAN PEDRO CINEPLEX PROPERTIES V. HEIRS OF ENAO
GR NO. 190754 NOVEMBER 17, 2010
Facts:
The Heirs of Enao filed a complaint for quieting of title with damages
against San Pedro Cineplex ( Cineplex) before RTC Laguna. Cineplex filed a motion
to dismiss, stating that the heirs of enao failed to serve the summons on its
president, general manager, corporate secretary, treasurer or in house counsel.
The heirs parried, stating that summons have been received by its Manager,
They likewise prayed that Cineplex be declared in default for failure to file an
answer before the reglementary period.
Close to 11 months after Cineplex filed a MTD, it filed a Motion to
withdraw that MTD and to admit Answer. The Trial Court denied the MTD, and
acting upon the heirs motion, declared Cineplex in default.
Cineplex filed a petition for certiorari before the CA. CA dismissed it on
the ff grounds:
1. the trial court properly acquired jurisdiction over petitioner via manager
Orpiada;
2. any flaw in the service of summons was cured by petitioners voluntary
submission to the trial courts jurisdiction when it filed the Motion to
Withdraw Motion to Dismiss and to Admit Answer; and
3. the trial court unerringly declared petitioner in default for failure to file an
Answer within the reglementary period.
Issue:
Did the RTC err in declaring Cineplex in default?
Held:
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Yes. because:
1. Indeed, where the answer is filed beyond the reglementary period
but before the defendant is declared in default and there is no showing
that defendant intends to delay the case, the answer should be admitted.
2. The trial court slept on petitioners Motion to Dismiss for almost a year,
just as it also slept on respondents Motion to Declare petitioner in
Default.
a. It was only when petitioner filed a Motion to Withdraw Motion
to Dismiss and to Admit Answer that it denied the Motion to
Dismiss, and acted on/granted respondents Motion to Declare
petitioner in Default. This is procedurally unsound.
Notes:
1. a defendant's answer should be admitted where it is filed before a
declaration of default and no prejudice is caused to the plaintiff.
2. where the answer is filed beyond the reglementary period
but before the defendant is declared in default and there is no
showing that defendant intends to delay the case, the answer
should be admitted.
REMEDIES OF A PARTY DECLARED IN DEFAULT
OTERO V TAN
GR NO. 200134 AUGUST 15, 2012
Facts:
A complaint for collection of sum of money and damages was filed by Tan
before the MTCC CDO against Otero. Despite receipt of summons and a copy of
the said complaint, Otero failed to file his answer. Tan filed a motion to declare
Otero in default, which the court granted. Tan was allowed to present his evidence
ex parte. MTCC rendered a decision directing Otero to pay his debt and damages.
Otero filed an appeal before RTC, averring that he had been deprived of due
process. RTC affirmed the MTCC decision. Oteros Motion for reconsideration had
22
been denied. Otero filed a petition for review before the CA. The CA dismissed the
petition. It held that any defense which Otero may have against Tans claim is
already waived due to Oteros failure to his answer, despite being duly served with
summons and his voluntary appearance in court.
Issue:
Did the Court of Appeal err in ruling that by virtue of default, Otero is barred from
alleging whatever defenses he may have against Tan i.e. due execution and
authenticity of the statements of account?
Held:
Yes.
1. a defendant who was declared in default may nevertheless appeal from
the judgement by default albeit on different grounds.
2. While it may be said that by defaulting, the defendant leaves himself at
the mercy of the court, the rules nevertheless see to it that any judgment
against him must be in accordance with the evidence required by law.
a. The evidence of the plaintiff, presented in the defendants
absence, cannot be admitted if it is basically incompetent.
b. Although the defendant would not be in a position to object,
elementary justice requires that only legal evidence should be
considered against him.
i. If the same should prove insufficient to justify a
judgment for the plaintiff, the complaint must be
dismissed.
ii. And if a favorable judgment is justifiable, it cannot
exceed in amount or be different in kind from what is
prayed for in the complaint.
LCD: the statement of account was merely hearsay as the genuineness and due
execution of the same were not established, given that during the ex parte
presentation of evidence, Tan did not present anyone who could attest that the
statement of account were genuine and duly executed. Nonetheless, the Court
found for Tan. The statement of accounts, while inadmissible are mere summaries,
that do not disprove Oteros liability. The testimonies of his employees also
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established that Otero do not pay whenever he drops by tans Petron outlet to buy
the petroleum products. Lastly, both the MTCC and RTC gave credence to Tans
testimony.
Notes:
1. A defendant who fails to file an answer may, upon motion, be declared by
the court in default.
a. Loss of standing in court, the forfeiture of ones right as a
party litigant, contestant or legal adversary, is the
consequence of an order of default.
b. A party in default loses his right to present his defense,
control the proceedings, and examine or cross-examine
witnesses.
c. He has no right to expect that his pleadings would be
acted upon by the court nor may be object to or refute
evidence or motions filed against him
2. In Lina v. CA, et al., 15 this Court enumerated the remedies available to
party who has been declared in default, to wit:
3. Indeed, a defending party declared in default retains the right to appeal
from the judgment by default.
a. However, the grounds that may be raised in such an appeal are
restricted to any of the following:
i. first, the failure of the plaintiff to prove the material
allegations of the complaint;
ii. second, the decision is contrary to law; and
iii. third, the amount of judgment is excessive or different
in kind from that prayed for.17
b. In these cases, the appellate tribunal should only consider the
pieces of evidence that were presented by the plaintiff during
the ex parte presentation of his evidence.
4. A defendant who has been declared in default is precluded from raising
any other ground in his appeal from the judgment by default since,
otherwise, he would then be allowed to adduce evidence in his defense,
which right he had lost after he was declared in default.18
a. Indeed, he is proscribed in the appellate tribunal from adducing
any evidence to bolster his defense against the plaintiffs claim.

a. The defendant in default may, at any time after discovery

thereof and before judgment, file a motion, under oath, to
set aside the order of default on the ground that his
failure to answer was due to fraud, accident, mistake or
excusable neglect, and that he has meritorious defenses;
(Sec 3, Rule 18)
b. If the judgment has already been rendered when the
defendant discovered the default, but before the same has
become final and executory, he may file a motion for new
trial under Section 1(a) of Rule 37;
c. If the defendant discovered the default after the judgment
has become final and executory, he may file a petition for
relief under Section 2 of Rule 38; and
d. He may also appeal from the judgment rendered against
him as contrary to the evidence or to the law, even if no
petition to set aside the order of default has been
presented by him. (Sec. 2, Rule 41)16(Emphasis ours)

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