A CADEMICUS REVIEW CENTER

Dean Ferdinand A. Tan

CIVIL LAW CASES (2012-2016)

J. BERSAMIN

Persons and Family Relations

Soledad Lavadia vs. Heirs of Juan Luces Luna

G.R. No. 171914, July 23, 2014
BERSAMIN, J.:
The Civil Code continued to follow the nationality rule, to the effect that Philippine laws relating to family
rights and duties or to the status, condition and legal capacity of persons were binding upon citizens of the
Philippines, although living abroad.
FACTS:
ATTY. LUNA, a practicing lawyer, was at first a name partner in the prestigious law firm Sycip, Salazar, Luna,
Manalo, Hernandez & Feliciano Law Offices at that time when he was living with his first wife Eugenia
Zaballero-Luna, where they begot seven (7) children. On January 12, 1976, ATTY. LUNA obtained a divorce
decree of his marriage with EUGENIA from the Civil and Commercial Chamber of the First Circumscription
of the Court of First Instance of Sto. Domingo, Dominican Republic. On the same date, ATTY. LUNA
contracted another marriage, this time with SOLEDAD. Thereafter, ATTY. LUNA and SOLEDAD returned to
the Philippines and lived together as husband and wife until 1987. Sometime in 1977, ATTY. LUNA organized
a new law firm named: Luna, Puruganan, Sison and Ongkiko (LUPSICON) where ATTY. LUNA was the
managing partner. On February 14, 1978, LUPSICON through ATTY. LUNA purchased the 6th Floor of
Kalaw-Ledesma Condominium Project. Sometime in 1992, LUPSICON was dissolved and the condominium
unit was partitioned by the partners but the same was still registered in common. The parties stipulated that the
interest of ATTY. LUNA over the condominium unit would be 25/100 share. ATTY. LUNA thereafter
established and headed another law firm with Atty. Renato G. De la Cruz and used a portion of the office
condominium unit as their office. The said law firm lasted until the death of ATTY. JUAN.
After the death of ATTY. JUAN, his share in the condominium unit including the lawbooks, office
furniture and equipment found therein were taken over by Gregorio Z. Luna, ATTY. LUNAs son of the first
marriage. The 25/100 pro-indiviso share of ATTY. Luna in the condominium unit as well as the law books,
office furniture and equipment became the subject of the complaint filed by SOLEDAD against the heirs of
ATTY. JUAN. The complaint alleged that the subject properties were acquired during the existence of the
marriage between ATTY. LUNA and SOLEDAD through their joint efforts.The RTC rendered its decision
after trial upon the aforementioned facts, disposing thusly: (a) The 24/100 pro-indiviso share in the
condominium unit is adjudged to have been acquired by Juan Lucas Luna through his sole industry;(b) Plaintiff
has no right as owner or under any other concept over the condominium unit (c) Plaintiff is declared to be the
owner of the books Corpus Juris, Fletcher on Corporation, American Jurisprudence and Federal Supreme Court
Reports found in the condominium unit and defendants are ordered to deliver them to the plaintiff as soon as
appropriate arrangements have been made for transport and storage.

ISSUES:
Whether or not the divorce between Atty. Luna and Eugenia Zaballero-Luna (Eugenia) had validly dissolved
the first marriage;
Whether the second marriage entered into by the late Atty. Luna and the petitioner entitled the latter to any
rights in property.

RULING:
Atty. Lunas first marriage with Eugenia subsisted up to the time of his death
 The Civil Code continued to follow the nationality rule, to the effect that Philippine laws relating to
family rights and duties or to the status, condition and legal capacity of persons were binding upon citizens of
the Philippines, although living abroad. Pursuant to the nationality rule, Philippine laws governed this case by
virtue of both Atty. Luna and Eugenio having remained Filipinos until the death of Atty. Luna on July 12, 1997
terminated their marriage.
From the time of the celebration of the first marriage on September 10, 1947 until the present, absolute
divorce between Filipino spouses has not been recognized in the Philippines. The non-recognition of absolute
divorce between Filipinos has remained even under the Family Code, even if either or both of the spouses are
residing abroad. Indeed, the only two types of defective marital unions under our laws have been the void and
the voidable marriages. As such, the remedies against such defective marriages have been limited to the
declaration of nullity of the marriage and the annulment of the marriage.
Conformably with the nationality rule, however, the divorce, even if voluntarily obtained abroad, did
not dissolve the marriage between Atty. Luna and Eugenia, which subsisted up to the time of his death on July
12, 1997. The non-recognition of absolute divorce in the Philippines is a manifestation of the respect for the
sanctity of the marital union especially among Filipino citizens. For as long as this public policy on marriage
between Filipinos exists, no divorce decree dissolving the marriage between them can ever be given legal or
judicial recognition and enforcement in this jurisdiction.

The Agreement for Separation and Property Settlement was void for lack of court approval

Considering that Atty. Luna and Eugenia had not entered into any marriage settlement prior to their
marriage on September 10, 1947, the system of relative community or conjugal partnership of gains governed
their property relations. The conjugal partnership of gains subsists until terminated for any of various causes of
termination enumerated in Article 175 of the Civil Code.
The mere execution of the Agreement by Atty. Luna and Eugenia did not per se dissolve and liquidate
their conjugal partnership of gains. The approval of the Agreement by a competent court was still required
under Article 190 and Article 191 of the Civil Code. Upon approval of the petition for dissolution of the
conjugal partnership, the court shall take such measures as may protect the creditors and other third persons.
After dissolution of the conjugal partnership, the provisions of articles 214 and 215 shall apply. The provisions
of this Code concerning the effect of partition stated in articles 498 to 501 shall be applicable.
But was not the approval of the Agreement by the CFI of Sto. Domingo in the Dominican Republic
sufficient in dissolving and liquidating the conjugal partnership of gains between the late Atty. Luna and
Eugenia?
The query is answered in the negative. There is no question that the approval took place only as an
incident of the action for divorce instituted by Atty. Luna and Eugenia, for, indeed, the justifications for their
execution of the Agreement were identical to the grounds raised in the action for divorce. With the divorce not
being itself valid and enforceable under Philippine law for being contrary to Philippine public policy and public
law, the approval of the Agreement was not also legally valid and enforceable under Philippine law.
Consequently, the conjugal partnership of gains of Atty. Luna and Eugenia subsisted in the lifetime of their
marriage.

Atty. Lunas marriage with Soledad, being bigamous, was void; properties acquired during their
marriage were governed by the rules on co-ownership

In the Philippines, marriages that are bigamous, polygamous, or incestuous are void. Due to the second
marriage between Atty. Luna and the petitioner being void ab initio by virtue of its being bigamous, the
properties acquired during the bigamous marriage were governed by the rules on co-ownership, conformably
with Article 144 of the Civil Code. In such a situation, whoever alleges co-ownership carried the burden of
proof to confirm such fact. To establish co-ownership, therefore, it became imperative for the petitioner to offer
proof of her actual contributions in the acquisition of property. Her mere allegation of co-ownership, without
sufficient and competent evidence, would warrant no relief in her favor.
The petitioner asserts herein that she sufficiently proved her actual contributions in the purchase of the
condominium unit in the aggregate amount of at least P306, 572.00, consisting in direct contributions of P159,
072.00, and in repaying the loans of Atty. Luna; and that such aggregate contributions of P306,572.00
corresponded to almost the entire share of Atty. Luna in the purchase of the condominium unit amounting to
P362,264.00 of the units purchase price of P1,449,056.00. The petitioner further asserts that the lawbooks were
paid for solely out of her personal funds, proof of which Atty. Luna had even sent her a thank you note; that
she had the financial capacity to make the contributions and purchases.
The CA entirely debunked the petitioners assertions on her actual contributions. SOLEDAD was not able
to prove by preponderance of evidence that her own independent funds were used to buy the law office
condominium and the law books subject matter in contention in this case proof that was required for Article
144 of the New Civil Code and Article 148 of the Family Code to apply. Article 148 provided that: only the
property acquired by both of the parties through their actual joint contribution of money, property or industry
shall be owned in common and in proportion to their respective contributions. Such contributions and
corresponding shares were prima facie presumed to be equal. However, for this presumption to arise, proof of
actual contribution was required. If one of the parties was validly married to another, his or her share in the co-
ownership accrued to the absolute community or conjugal partnership existing in such valid marriage. If the
party who acted in bad faith was not validly married to another, his or her share shall be forfeited in the manner
provided in the last paragraph of the Article 147. The rules on forfeiture applied even if both parties were in
bad faith.
Co-ownership was the exception while conjugal partnership of gains was the strict rule whereby marriage
was an inviolable social institution and divorce decrees are not recognized in the Philippines.
As to the 25/100 pro-indiviso share of ATTY. LUNA in the condominium unit, SOLEDAD failed to prove
that she made an actual contribution to purchase the said property. The fact that CCT No. 4779 and
subsequently, CCT No. 21761 were in the name of JUAN LUCES LUNA, married to Soledad L. Luna was
no proof that SOLEDAD was a co-owner of the condominium unit. Acquisition of title and registration thereof
are two different acts. It is well settled that registration does not confer title but merely confirms one already
existing. The phrase married to preceding Soledad L. Luna is merely descriptive of the civil status of
ATTY. LUNA. SOLEDAD, the second wife, was not even a lawyer. So it is but logical that SOLEDAD had no
participation in the law firm or in the purchase of books for the law firm. SOLEDAD failed to prove that she
had anything to contribute and that she actually purchased or paid for the law office amortization and for the
law books.
The Court upholds the foregoing findings and conclusions by the CA both because they were substantiated
by the records and because we have not been shown any reason to revisit and undo them. Her mere allegations
on her contributions, not being evidence, did not serve the purpose. In contrast, given the subsistence of the
first marriage between Atty. Luna and Eugenia, the presumption that Atty. Luna acquired the properties out of
his own personal funds and effort remained. It should then be justly concluded that the properties in litis legally
pertained to their conjugal partnership of gains as of the time of his death. Consequently, the sole ownership of
the 25/100 pro indiviso share of Atty. Luna in the condominium unit, and of the lawbooks pertained to the
respondents as the lawful heirs of Atty. Luna.

Property

Heirs of Mario Malabanan vs. Republic of the Philippines

G.R. No. 179987
September 3, 2013
BERSAMIN, J.:
Alienable and disposable lands of the State fall into two categories, to wit: (a) patrimonial lands of the State, or
those classified as lands of private ownership under Article 425 of the Civil Code, without limitation; and (b)
lands of the public domain, or the public lands as provided by the Constitution, but with the limitation that the
lands must only be agricultural.
FACTS:
The property subject of the application for registration is a parcel of land situated in Barangay Tibig, Silang
Cavite, more particularly identified as Lot 9864-A, Cad-452-D, with an area of 71,324-square meters.
Applicant Mario Malabanan, who had purchased the property from Eduardo Velazco, filed an application for
land registration covering the property in the Regional Trial Court (RTC) in Tagaytay City, Cavite, claiming
that the property formed part of the alienable and disposable land of the public domain, and that he and his
predecessors-in-interest had been in open, continuous, uninterrupted, public and adverse possession and
occupation of the land for more than 30 years, thereby entitling him to the judicial confirmation of his title. To
prove that the property was an alienable and disposable land of the public domain, Malabanan presented during
trial a certification dated June 11, 2001 issued by the Community Environment and Natural Resources Office
(CENRO) of the Department of Environment and Natural Resources (DENR). RTC rendered judgment
granting Malabanans application for land registration. CA promulgated its decision reversing the RTC and
dismissing the application for registration of Malabanan. CA declared that under Section 14(1) of the Property
Registration Decree, any period of possession prior to the classification of the land as alienable and disposable
was inconsequential and should be excluded from the computation of the period of possession.

ISSUE: Whether or not petitioners were entitled to the land

RULING:
Classifications of land according to ownership
Land, which is an immovable property, may be classified as either of public dominion or of private ownership.
Land is considered of public dominion if it either: (a) is intended for public use; or (b) belongs to the State,
without being for public use, and is intended for some public service or for the development of the national
wealth. Land belonging to the State that is not of such character, or although of such character but no longer
intended for public use or for public service forms part of the patrimonial property of the State. Land that is
other than part of the patrimonial property of the State, provinces, cities and municipalities is of private
ownership if it belongs to a private individual. Pursuant to the Regalian Doctrine (Jura Regalia), a legal concept
first introduced into the country from the West by Spain through the Laws of the Indies and the Royal Cedulas,
all lands of the public domain belong to the State. This means that the State is the source of any asserted right
to ownership of land, and is charged with the conservation of such patrimony. All lands not appearing to be
clearly under private ownership are presumed to belong to the State. Also, public lands remain part of the
inalienable land of the public domain unless the State is shown to have reclassified or alienated them to private
persons.

Classifications of public lands according to alienability

Whether or not land of the public domain is alienable and disposable primarily rests on the classification of
public lands made under the Constitution. Constitution places a limit on the type of public land that may be
alienated. Under Section 2, Article XII of the 1987 Constitution, only agricultural lands of the public domain
may be alienated; all other natural resources may not be. Alienable and disposable lands of the State fall into
two categories, to wit: (a) patrimonial lands of the State, or those classified as lands of private ownership under
Article 425 of the Civil Code, without limitation; and (b) lands of the public domain, or the public lands as
provided by the Constitution, but with the limitation that the lands must only be agricultural. Consequently,
lands classified as forest or timber, mineral, or national parks are not susceptible of alienation or disposition
unless they are reclassified as agricultural. A positive act of the Government is necessary to enable such
reclassification, and the exclusive prerogative to classify public lands under existing laws is vested in the
Executive Department, not in the courts. If, however, public land will be classified as neither agricultural, forest
or timber, mineral or national park, or when public land is no longer intended for public service or for the
development of the national wealth, thereby effectively removing the land from the ambit of public dominion, a
declaration of such conversion must be made in the form of a law duly enacted by Congress or by a Presidential
proclamation in cases where the President is duly authorized by law to that effect.27 Thus, until the Executive
Department exercises its prerogative to classify or reclassify lands, or until Congress or the President declares
that the State no longer intends the land to be used for public service or for the development of national wealth,
the Regalian Doctrine is applicable.

Disposition of alienable public lands

We now observe the following rules relative to the disposition of public land or lands of the public domain,
namely:
(1) As a general rule and pursuant to the Regalian Doctrine, all lands of the public domain belong to the State
and are inalienable. Lands that are not clearly under private ownership are also presumed to belong to the State
and, therefore, may not be alienated or disposed;
(2) The following are excepted from the general rule, to wit:
(a) Agricultural lands of the public domain are rendered alienable and disposable through any of the exclusive
modes enumerated under Section 11 of the Public Land Act. If the mode is judicial confirmation of imperfect
title under Section 48(b) of the Public Land Act, the agricultural land subject of the application needs only to be
classified as alienable and disposable as of the time of the application, provided the applicants possession and
occupation of the land dated back to June 12, 1945, or earlier. Thereby, a conclusive presumption that the
applicant has performed all the conditions essential to a government grant arises, and the applicant becomes the
owner of the land by virtue of an imperfect or incomplete title. By legal fiction, the land has already ceased to
be part of the public domain and has become private property.
(b) Lands of the public domain subsequently classified or declared as no longer intended for public use or for
the development of national wealth are removed from the sphere of public dominion and are considered
converted into patrimonial lands or lands of private ownership that may be alienated or disposed through any of
the modes of acquiring ownership under the Civil Code. If the mode of acquisition is prescription, whether
ordinary or extraordinary, proof that the land has been already converted to private ownership prior to the
requisite acquisitive prescriptive period is a condition sine qua non in observance of the law (Article 1113,
Civil Code) that property of the State not patrimonial in character shall not be the object of prescription.
 The petitioners failed to present sufficient evidence to establish that they and their predecessors-in-interest had
been in possession of the land since June 12, 1945. Without satisfying the requisite character and period of
possession - possession and occupation that is open, continuous, exclusive, and notorious since June 12, 1945,
or earlier - the land cannot be considered ipso jure converted to private property even upon the subsequent
declaration of it as alienable and disposable. Prescription never began to run against the State, such that the
land has remained ineligible for registration under Section 14(1) of the Property Registration Decree. Likewise,
the land continues to be ineligible for land registration under Section 14(2) of the Property Registration Decree
unless Congress enacts a law or the President issues a proclamation declaring the land as no longer intended for
public service or for the development of the national wealth.

Sps. Alfonso and Maria Angeles Cusi vs. Lilia Domingo

G.R. No. 195825, February 27, 2013
BERSAMIN, J.:
Under the Torrens system of land registration, the registered owner of realty cannot be deprived of her
property through fraud, unless a transferee acquires the property as an innocent purchaser for value. A
transferee who acquires the property covered by a reissued owner's copy of the certificate of title without
taking the ordinary precautions of honest persons in doing business and examining the records of the proper
Registry of Deeds, or who fails to pay the full market value of the property is not considered an innocent
purchaser for value.
FACTS:
On July 18, 1997, one Radelia Sy (Sy), representing herself as the owner of the property, petitioned the RTC
for the issuance of a new owners copy of Domingos TCT No. N-165606, appending to her petition a deed of
absolute sale dated July 14, 1997 purportedly executed in her favor by Domingo; and an affidavit of loss dated
July 17, 1997, whereby she claimed that her bag containing the owners copy of TCT No. N-165606 had been
snatched from her on July 13, 1997 while she was at the SM City in North EDSA, Quezon City. The RTC
granted Sys petition on August 26, 1997. The Registry of Deeds of Quezon City then issued a new owners
duplicate copy of TCT No. N-165606, which was later cancelled by virtue of the deed of absolute sale dated
July 14, 1997, and in its stead the Registry of Deeds of Quezon City issued TCT No. 186142 in Sys name. Sy
subsequently subdivided the property into two, and sold each half by way of contract to sell to Spouses
Edgardo and Ramona Liza De Vera and to Spouses Alfonso and Maria Angeles Cusi. The existence of the
individual contracts to sell was annotated on the dorsal portion of Sys TCT No. 186142 as Entry No. PE-
8907/N-186142, stating that the consideration of the sale was P1,000,000.00 for each set of buyers, or for a
total of P2,000,000.00 for the entire property that had an actual worth of not less than P14,000,000.00. TCT
No. 186142 in the name of Sy was then cancelled by virtue of the deeds of sale executed between Sy and
Spouses De Vera, and between Sy and Spouses Cusi, to whom were respectively issued TCT No. 18956810
and TCT No. 189569. All the while, the transactions between Sy and the De Veras, and between Sy and the
Cusis were unknown to Domingo, whose TCT No. N-165606 remained in her undisturbed possession. It turned
out that the construction activities taking place on the property that Domingo learned about were upon the
initiative of the De Veras in the exercise of their dominical and possessory rights. Domingo commenced this
action against Sy and her spouse, the De Veras and the Cusis in the RTC.

ISSUE: Whether or not she was an innocent purchaser for value and in good faith.

RULING: No
Now beyond dispute is the nullity of the transfer of Domingos property to Sy because both lower courts united
in so finding. The unanimity in findings of both the RTC and the CA on this all-important aspect of the case is
now conclusive on the Court.
Under the Torrens system of land registration, the State is required to maintain a register of landholdings that
guarantees indefeasible title to those included in the register. The system has been instituted to combat the
problems of uncertainty, complexity and cost associated with old title systems that depended upon proof of an
unbroken chain of title back to a good root of title. The State issues an official certificate of title to attest to the
fact that the person named is the owner of the property described therein, subject to such liens and
encumbrances as thereon noted or what the law warrants or reserves. One of the guiding tenets underlying the
Torrens system is the curtain principle, in that one does not need to go behind the certificate of title because it
contains all the information about the title of its holder. This principle dispenses with the need of proving
ownership by long complicated documents kept by the registered owner, which may be necessary under a
private conveyancing system, and assures that all the necessary information regarding ownership is on the
certificate of title. Consequently, the avowed objective of the Torrens system is to obviate possible conflicts of
title by giving the public the right to rely upon the face of the Torrens certificate and, as a rule, to dispense with
the necessity of inquiring further; on the part of the registered owner, the system gives him complete peace of
mind that he would be secured in his ownership as long as he has not voluntarily disposed of any right over the
covered land.
The petitioners were shown to have been deficient in their vigilance as buyers of the property. It was not
enough for them to show that the property was unfenced and vacant; otherwise, it would be too easy for any
registered owner to lose her property, including its possession, through illegal occupation. Nor was it safe for
them to simply rely on the face of Sys TCT No. 186142 in view of the fact that they were aware that her TCT
was derived from a duplicate owners copy reissued by virtue of the loss of the original duplicate owners copy.
That circumstance should have already alerted them to the need to inquire beyond the face of Sys TCT No.
186142. There were other circumstances, like the almost simultaneous transactions affecting the property
within a short span of time, as well as the gross undervaluation of the property in the deeds of sale, ostensibly at
the behest of Sy to minimize her liabilities for the capital gains tax, that also excited suspicion, and required
them to be extra-cautious in dealing with Sy on the property.
Another circumstance indicating that the Cusis and the De Veras were not innocent purchasers for value was
the gross undervaluation of the property in the deeds of sale at the measly price of P1,000,000.00 for each half
when the true market value was then in the aggregate of at least P14,000,000.00 for the entire property. Even if
the undervaluation was to accommodate the request of Sy to enable her to minimize her liabilities for the
capital gains tax, their acquiescence to the fraud perpetrated against the Government, no less, still rendered
them as parties to the wrongdoing. They were not any less guilty at all. In the ultimate analysis, their supposed
passivity respecting the arrangement to perpetrate the fraud was not even plausible, because they knew as the
buyers that they were not personally liable for the capital gains taxes and thus had nothing to gain by their
acquiescence. There was simply no acceptable reason for them to have acquiesced to the fraud, or for them not
to have rightfully insisted on the declaration of the full value of the realty in their deeds of sale. By letting their
respective deeds of sale reflect the grossly inadequate price, they should suffer the consequences, including the
inference of their bad faith in transacting the sales in their favor.
A purchaser in good faith is one who buys the property of another without notice that some other person has a
right to, or interest in, such property and pays full and fair price for the same.38 As an examination of the
records shows, the petitioners were not innocent purchasers in good faith and for value. Their failure to
investigate Sy's title despite the nearly simultaneous transactions on the property that ought to have put them on
inquiry manifested their awareness of the flaw in Sy's title. That they did not also appear to have paid the full
price for their share of the property evinced their not having paid true value.

Sps. Celso Dico Sr. and Angeles Dico vs. Vizcaya Management Corp.
G.R. No. 161211, July 17, 2013
BERSAMIN, J.:
The prescription of actions for the reconveyance of real property based on implied trust is 10 years.
FACTS:
Celso Dico was the registered owner of Lot No. 486 of the Cadiz Cadastre, comprising an area of 67,300
square meters and covered by Transfer Certificate of Title (TCT) No. 22922 of the land records of Negros
Occidental. Lot No. 486 was adjacent to Lot No. 29-B and Lot No. 1412 (formerly Lot No. 1118-B), both also
of the Cadiz Cadastre. Celso and his wife Angeles resided on Lot No. 486 since 1958. On May 30, 1964,
Angeles filed in the District Office of the Bureau of Lands in Bacolod City, her free patent application covering
a portion of Lot No. 29-B. On his part, Celso also filed in the same office an application for free patent
covering Lot No. 1412. It does not appear, however, that the Bureau of Lands acted on their applications.
Respondent Vizcaya Management Corporation (VMC) was the registered owner under TCT No. T-41835 of
Lot No. 29-B, also of the Cadiz Cadastre, comprising an area of 369,606 square meters, more or less. VMC
derived its title to Lot No. 29-B from Eduardo and Cesar, both surnamed Lopez, the registered owners under
TCT No. T-14827, which emanated from TCT No. RT-9933 (16739) in the names of Victoria, Eduardo and
Cesar, all surnamed Lopez. TCT No. RT-9933 (16739) was a transfer from TCT No. T-14281, which had been
transferred from Original Certificate of Title (OCT) No. 21331 in the name of Negros Philippines Lumber
Company. OCT No. 21331 was issued pursuant to Decree No. 190483 of G.L.R.O. Cadastral Record No. 196.
VMC likewise claimed to be the owner of Lot No. 1412, formerly known as Lot No. 1118-B, also of the Cadiz
Cadastre, containing an area of 85,239 square meters, more or less, and registered in its name under TCT No.
T-41834.4
Lot Nos. 1426-B, with an area of 6,635 square meters covered by TCT No. T-24135, and 1426-C, with an area
of 6,107 square meters covered by TCT No. T-24136, appear to be registered in the names of Eduardo Lopez
and Cesar Lopez, who had earlier formed VMC.
 In 1967, VMC, then newly formed, caused the consolidation and subdivision of Lot No. 29-B, Lot No. 1412,
Lot No. 1426-B, and Lot No. 1426-C. The consolidation-subdivision plan was prepared by Engr. Ricardo
Quilop and filed in the Land Registration Commission (LRC), renamed National Land Titles and Deeds
Registration Administration, but presently known as the Land Registration Authority. The consolidation-
subdivision plan was assigned the number (LRC) PCS-6611. On July 26, 1967, LRC Commissioner Antonio L.
Noblejas approved the consolidation-subdivision plan, resulting in Lot No. 29-B, Lot No. 1412, Lot No. 1426-
B, and Lot No. 1426-C being consolidated and subdivided.
VMC filed against the Dicos a complaint for unlawful detainer in the City Court of Cadiz (Civil Case No. 649).
On April 24, 1981, the City Court of Cadiz rendered its decision in favor of VMC, ordering the Dicos to
demolish the concrete water gate or sluice gate (locally known as trampahan) located inside Lot No. 1, Block 3
of the Cristina Village Subdivision. Inasmuch as the Dicos did not appeal, the decision attained finality. On
July 3, 1981, the City Court of Cadiz issued a writ of execution. On November 11, 1985, a second alias writ of
execution was issued.
On May 12, 1986, the Dicos commenced an action for the annulment and cancellation of the titles of VMC
(Civil Case No. 180-C), impleading VMC, the National Land Titles and Deeds Registration Administration,
and the Director of the Bureau of Lands. On March 12, 1987, the Dicos amended the complaint. They averred,
among others, that they were the registered owners of Lot No. 486 and the possessors-by-succession of Lot No.
1412 (formerly Lot No. 1118) and Lot No. 489; that VMC had land-grabbed a portion of their Lot No. 486
totaling 111,966 square meters allegedly brought about by the expansion of Cristina Village Subdivision; and
that on May 30, 1964 they had filed free patent applications in the Bureau of Lands for Lot No. 1412 and Lot
No. 489.6 They prayed that the possession of Lot No. 486, Lot No. 1412, and Lot No. 489 be restored to them;
and that the judgment in Civil Case No. 649 be annulled.

ISSUE: Whether or not CA erred in holding that prescription and/or laches already barred them from asserting
their right

RULING: No
We find and hold that the action of the Dicos for reconveyance was properly dismissed. CA correctly pointed
out that under Article 1456 of the Civil Code, the person obtaining property through mistake or fraud is
considered by force of law a trustee of an implied trust for the benefit of the person from whom the property
comes. Under Article 1144, Civil Code, an action upon an obligation created by law must be brought within 10
years from the time the right of action accrues. Consequently, an action for reconveyance based on implied or
constructive trust prescribes in 10 years.
Here, the CA observed that even granting that fraud intervened in the issuance of the transfer certificates of
title, and even assuming that the Dicos had the personality to demand the reconveyance of the affected property
on the basis of implied or constructive trust, the filing of their complaint for that purpose only on May 12, 1986
proved too late for them. The reckoning point for purposes of the Dicos demand of reconveyance based on
fraud was their discovery of the fraud. Such discovery was properly pegged on the date of the registration of
the transfer certificates of title in the adverse parties names, because registration was a constructive notice to
the whole world.19 The long period of 29 years that had meanwhile lapsed from the issuance of the pertinent
transfer certificate of title on September 30, 1934 (the date of recording of TCT No. RT-9933 (16739) in the
name of the Lopezes) or on November 10, 1956 (the date of recording of TCT No. T-41835 in VMCs name)
was way beyond the prescriptive period of 10 years.

Republic of the Philippines vs. Zurbaran Realty and Development Corporation

G.R. No. 164408, March 24, 2014
BERSAMIN, J.:
Registration under Section 14(1) of P.D. No. 1529 is based on possession and occupation of the alienable and
disposable land of the public domain since June 12, 1945 or earlier, without regard to whether the land was
susceptible to private ownership at that time. The applicant needs only to show that the land had already been
declared alienable and disposable at any time prior to the filing of the application for registration. On the
other hand, an application under Section 14(2) of P.D. No. 1529 is based on acquisitive prescription and must
comply with the law on prescription as provided by the Civil Code. In that regard, only the patrimonial
property of the State may be acquired by prescription pursuant to the Civil Code.
FACTS:
 Respondent Zurbaran Realty and Development Corporation filed in the Regional Trial Court (RTC) in
San Pedro, Laguna an application for original registration covering a parcel of land situated in Barrio Banlic,
Municipality of Cabuyao, Province of Laguna, alleging that it had purchased the land on March 9, 1992 from
Jane de Castro Abalos; that there was no mortgage or encumbrance of any kind affecting the land; and that the
applicant and its predecessorsininterest had been in open, continuous and exclusive possession and
occupation of the land in the concept of an owner.
The Republic opposed the application, arguing that the applicant and its predecessorsininterest had
not been in open, continuous, exclusive and notorious possession and occupation of the land since June 12,
1945; that the land was a portion of the public domain, and, therefore, was not subject to private appropriation.
A certification was issued by the Records Management Division of the Land Management Bureau
stating that it had no record of any kind of public land applications/land patents covering the parcel of land
subject of the application.
The respondent presented Gloria P. Noel, its Vice President and Treasurer, who testified that the
respondent had purchased the land from Jane de Castro Abalos on March 9, 1992 that the land had been
declared for taxation purposes in the name of Abalos. The RTC rendered its decision granting the application
for registration. On appeal, the CA promulgated its judgment affirming the RTC.

ISSUE: Whether or not the CA gravely erred on a question of law when it affirmed the Trial Courts grant of
the application for original registration.

RULING:
YES.
Section 14 of P.D. No. 1529 enumerates those who may file an application for registration of land
based on possession and occupation of a land of the public domain.
Section 14(1) mandates registration on the basis of possession, while Section 14(2) entitles registration
on the basis of prescription. Registration under Section 14(1) is extended under the aegis of the Property
Registration Decree and the Public Land Act while registration under Section 14(2) is made available both by
the Property Registration Decree and the Civil Code.
In other words, registration under Section 14(1) of P.D. No. 1529 is based on possession and
occupation of the alienable and disposable land of the public domain since June 12, 1945 or earlier, without
regard to whether the land was susceptible to private ownership at that time. The applicant needs only to show
that the land had already been declared alienable and disposable at any time prior to the filing of the application
for registration. On the other hand, an application under Section 14(2) of P.D. No. 1529 is based on acquisitive
prescription and must comply with the law on prescription as provided by the Civil Code. In that regard, only
the patrimonial property of the State may be acquired by prescription pursuant to the Civil Code.
An application for registration based on Section 14(2) of P.D. No. 1529 must, therefore, establish that
the land had already been converted to or declared as patrimonial property of the State at the beginning of the
said 10year or 30year period of possession.
The respondents application does not enlighten as to whether it was filed under Section 14(1) or
Section 14(2) of P.D. No. 1529. At any rate, the evidence presented by the respondent and its averments in the
other pleadings reveal that the application for registration was filed based on Section 14(2), not Section 14(1)
of P.D. No. 1529. The respondent did not make any allegation in its application that it had been in possession
of the property since June 12, 1945, or earlier, nor did it present any evidence to establish such fact. With the
application of the respondent having been filed under Section 14(2) of P.D. No. 1529, the crucial query is
whether the land subject of the application had already been converted to patrimonial property of the State.
Here, there is no evidence showing that the land in question was within an area expressly declared by law either
to be the patrimonial property of the State, or to be no longer intended for public service or the development of
the national wealth. The Court is left with no alternative but to deny the respondents application for
registration.

Leonora Pascual vs. Josefino Daquioag

G.R. No. 162063, March 31, 2014
BERSAMIN, J.:
As a general rule, a writ of execution should strictly conform to every particular of the judgment to be
executed, and not vary the terms of the judgment it seeks to enforce, nor may it go beyond the terms of the
judgment sought to be executed; the execution is void if it is in excess of and beyond the original judgment or
award.
FACTS:
 Petitioner Pascual filed a Free Patent Application over Lot No. 13194, Lot No. 13212 and Lot No.
13214, Cad. 577D. Respondent Catalina AlmazanVillamor presented a protest, which was given due course
by the Executive Director of Region I of the DENR in San Fernando, La Union. The free patent application of
Pascual was likewise rejected. Moreover, claimantProtestant Almazan - Villamor was advised to file Free
Patent Applications immediately after the finality of the Decision.
Pascual appealed to the Secretary of the DENR, who affirmed the decision of the Regional Executive
Director. Pascual thereafter appealed to the Office of the President (OP), which affirmed the decision of the
Secretary of the DENR. Still dissatisfied with the result, Pascual elevated the decision of the OP to the CA by
petition for review, but the CA outrightly denied due course her petition for review. The Regional Executive
Director of the DENR issued the writ of execution directing the CENRO to execute the decision.
Accordingly, respondent CENRO Josefino L. Daquioag issued a memorandum directing respondents to
implement the writ of execution against Pascual. Pascual brought a special civil action for certiorari with
prayer for issuance of writ of injunction in the RTC assailing the issuance of the memorandum and the
execution proceedings, and by placing Catalina AlmazanVillamor in possession of the premises in question,
alleging that the decision of the Regional Executive Director of the DENR did not authorize or direct such
action; that placing AlmazanVillamor in possession of the properties would be tantamount to her being ejected
without due process of law; the RTC dismissed Pascuals petition for certiorari for lack of merit.

ISSUES:
Whether or not the public respondent has the authority to order the eviction/ejection of the petitioner from the
parcels of land through questioned memorandum.
Whether or not the CA rightly sustained the RTCs dismissal of Pascuals petition for certiorari.

RULING:
YES.
As a general rule, a writ of execution should strictly conform to every particular of the judgment to be
executed, and not vary the terms of the judgment it seeks to enforce, nor may it go beyond the terms of the
judgment sought to be executed; the execution is void if it is in excess of and beyond the original judgment or
award. Admittedly, the phrase placing the winning party, Catalina Almazan Villamor in the premises of the
land in question was not expressly stated in the dispositive portion of the decision of the Regional Executive
Director of the DENR. But the absence of that phrase did not render the directive to enforce invalid because the
directive was in full consonance with the decision sought to be executed.
The denial of Pascuals free patent application was based on the recognition of Almazan Villamors
ownership of the subject properties. Possession is an essential attribute of ownership. Whoever owns the
property has the right to possess it. Adjudication of ownership includes the delivery of possession if the
defeated party has not shown any right to possess the land independently of her rejected claim of ownership.
Accordingly, Daquioags memorandum placing AlmazanVillamor in possession of the properties was not
inconsistent with the decision of the Regional Executive Director of the DENR, as affirmed by the OP.
The RTC correctly held that placing AlmazanVillamor in possession of the properties was necessary
to give effect to the order requiring Pascual to refrain from entering the premises.

The CA rightly sustained the RTCs dismissal of Pascuals petition for certiorari because of the impropriety of
her chosen remedy. A special civil action for certiorari is the proper action to bring when a tribunal, board or
officer exercising judicial or quasijudicial function has acted without or in excess of its or his jurisdiction, or
with grave abuse of discretion amounting to lack or excess of jurisdiction and there is no appeal, or any plain,
speedy, and adequate remedy in the ordinary course of law. The term quasijudicial function applies to the
action and discretion of public administrative officers or bodies that are required to investigate facts or to
ascertain the existence of facts, hold hearings, and draw conclusions from them as a basis for their official
action and to exercise discretion of a judicial nature. However, the issuance by Daquioag of the assailed
memorandum implementing the writ of execution did not derive from the performance of a judicial or quasi
judicial function. He was not thereby called upon to adjudicate the rights of the contending parties or to
exercise any discretion of a judicial nature, but only performing an administrative duty of enforcing and
implementing the writ.

Republic of the Philippines vs. Rosario de Guzman Vda De Joson

G.R. No. 163767, March 10, 2014
BERSAMIN, J.:
The Regalian doctrine dictates that all lands of the public domain belong to the State. The applicant for land
registration has the burden of overcoming the presumption of State ownership by establishing through
incontrovertible evidence that the land sought to be registered is alienable or disposable based on a positive
act of the government.
FACTS:
The respondent filed her application for land registration in the CFI in Bulacan. In their opposition, the
Director of Lands and the Director of Forest Development averred that whatever legal and possessory rights the
respondent had acquired by reason of any Spanish government grants had been lost, abandoned or forfeited for
failure to occupy and possess the land for at least 30 years immediately preceding the filing of the application;
and that the land applied for, being actually a portion of the Labangan Channel operated by the Pampanga
River Control System, could not be subject of appropriation or land registration. The CFI rendered its decision,
ordering the registration of the land in favor of the respondent. The CA affirmed the RTC.

ISSUE: Whether or not the RTC and the CA erred in granting the application for registration.

RULING:
The respondent sought to have the land registered in her name by alleging that she and her predecessorsin
interest had been in open, peaceful, continuous, uninterrupted and adverse possession of the land in the concept
of owner since time immemorial. However, the Republic counters that the land was public land; and that it
could not be acquired by prescription.
Through the years, Section 48(b) of the CA 141 has been amended several times. The Court of
Appeals failed to consider the amendment introduced by PD 1073. The original Section 48(b) of C.A. No.141
provided for possession and occupation of lands of the public domain since July 26, 1894. This was
superseded by R.A. No. 1942, which provided for a simple thirtyyear prescriptive period of occupation by an
applicant for judicial confirmation of imperfect title. The same, however, has already been amended by
Presidential Decree No. 1073, approved on January 25, 1977. Under Section 14(1), therefore, the respondent
had to prove that: (1) the land formed part of the alienable and disposable land of the public domain; and (2)
she, by herself or through her predecessorsininterest, had been in open, continuous, exclusive, and notorious
possession and occupation of the subject land under a bona fide claim of ownership from June 12, 1945, or
earlier. It is the applicant who carries the burden of proving that the two requisites have been met. Failure to do
so warrants the dismissal of the application.
The respondent unquestionably complied with the second requisite by virtue of her having been in
open, continuous, exclusive and notorious possession and occupation of the land since June 12, 1945, or earlier.
Nonetheless, what is left wanting is the fact that the respondent did not discharge her burden to prove the
classification of the land as demanded by the first requisite. She did not present evidence of the land, albeit
public, having been declared alienable and disposable by the State. Even had the respondents effort to insert
the certification been successful, the same would nonetheless be vain and ineffectual. In Menguito v.
Republic, the Court pronounced that a survey conducted by a geodetic engineer that included a certification on
the classification of the land as alienable and disposable was not sufficient to overcome the presumption that
the land still formed part of the inalienable public domain.
We reiterate the standing doctrine that land of the public domain, to be the subject of appropriation,
must be declared alienable and disposable either by the President or the Secretary of the DENR. Verily, a mere
surveyor has no authority to reclassify lands of the public domain, such as in the present case. By relying
solely on the said surveyors assertion, petitioners have not sufficiently proven that the land in question has
been declared alienable.
The Regalian doctrine dictates that all lands of the public domain belong to the State. The applicant for
land registration has the burden of overcoming the presumption of State ownership by establishing through
incontrovertible evidence that the land sought to be registered is alienable or disposable based on a positive act
of the government. Here, respondent Corporation only presented a CENRO certification in support of its
application. Clearly, this falls short of the requirements for original registration. Yet, even assuming that the
DENRCENRO certification alone would have sufficed, the respondents application would still be denied
considering that the reclassification of the land as alienable or disposable came only after the filing of the
application in court in 1976.
We noted in Naguit that it should be distinguished from Bracewell v. Court of Appeals since in the
latter, the application for registration had been filed before the land was declared alienable or disposable. The
dissent though pronounces Bracewell as the better rule between the two. Yet two years after Bracewell,
its ponente, the esteemed Justice Consuelo YnaresSantiago, penned the ruling in Republic v. Ceniza, which
involved a claim of possession that extended back to 1927 over a public domain land that was declared
alienable and disposable only in 1980. Why did the Court in Ceniza, through the same eminent member who
authored Bracewell, sanction the registration under Section 48(b) of public domain lands declared alienable or
disposable thirtyfive (35) years and 180 days after 12 June 1945? The telling difference is that in Ceniza, the
application for registration was filed nearly six (6) years after the land had been declared alienable or
disposable, while in Bracewell, the application was filed nine (9) years before the land was declared alienable
or disposable. That crucial difference was also stressed in Naguit to contradistinguish it from Bracewell, a
difference which the dissent seeks to belittle.
On the other hand, under Section 14(2), ownership of private lands acquired through prescription may
be registered in the owners name. Did the respondent then acquire the land through prescription considering
that her possession and occupation of the land by her and her predecessorsininterest could be traced back to
as early as in 1926, and that the nature of their possession and occupation was that of a bona fide claim of
ownership for over 30 years? It is clear that property of public dominion, which generally includes property
belonging to the State, cannot be the object of prescription or, indeed, be subject of the commerce of man.
Lands of the public domain, whether declared alienable and disposable or not, are property of public dominion
and thus insusceptible to acquisition by prescription.

Hector Uy vs. Virginia Fule et al

G.R. No. 164961, June 30, 2014
BERSAMIN, J.:
The standard is that for one to be a purchaser in good faith in the eyes of the law, he should buy the property of
another without notice that some other person has a right to, or interest in, such property, and should pay a full
and fair price for the same at the time of such purchase, or before he has notice of the claim or interest of some
other persons in the property. He buys the property with the belief that the person from whom he receives the
property was the owner and could convey title to the property. Indeed, a purchaser cannot close his eyes to
facts that should put a reasonable man on his guard and still claim he acted in good faith.
FACTS:
The dispute herein involves the parcel of land registered under Transfer Certificate of Title (TCT) No.
30111 of the Registry of Deeds of Camarines Sur that was part of the vast tract of land covered by TCT No.
1128 registered in the name of the late Conrado Garcia. Upon the death of Conrado , his heirs entered into an
extrajudicial settlement of his estate, including the vast track of land. Thereafter, his heirs caused the
registration of the vast track of land under TCT No. RT-8922 (16498), covering Lot 1, PSU-81269 and Lot 2,
PSU-81269.cralawred
In September 1985, the Department of Agrarian Reform engaged Geodetic Engr. Rolando A. Sales to
conduct a survey of the disputed land. Sales issued a joint certification to the effect that the disputed land was
an untitled property owned by Conrado Garcia. The joint certification was buttressed by the certification
issued by the Office of the Register of Deeds to the effect that no title covering Lot 562, Cad. 291 (Csd-05-
003874) appeared on record. As a result, the disputed land was included in the Operation Land Transfer
program of the DAR.
The DAR and the Office of the Register of Deeds of Camarines Sur respectively issued emancipation
patents and original certificates of title covering the disputed land to the farmers-beneficiaries. In the interim,
farmer-beneficiary Mariano Ronda sold his portion to Chisan Uy who then registered his title thereto. On the
other hand, the heirs of farmer-beneficiary Mariano Ronda sold their land to petitioner Hector Uy. The
petitioner registered his title thereto
In 1997, TCT No. RT-8922 (16498) was cancelled following the partition of the property covered therein.
Subsequently, TCT No. 30136 and TCT No. 30111 were issued in the names of respondents heirs of the late
Conrado Garcia. TCT No. 30111 covered the disputed land. In 1998, the President, acting through the DAR
Secretary, issued EPs to the farmers-beneficiaries pursuant to P.D. No. 27 and P.D. No. 266. On December 21,
1998, the respondents filed a complaint for cancellation of titles, quieting of title, recovery of possession, and
damages against public defendants and the farmer-beneficiaries in the Regional Trial Court (RTC) in Pili,
Camarines Sur.
The RTC resolved in favor of the respondents by finding that no notice of the inclusion of the disputed land
under the operation of P.D. No. 27 had been given to them. The RTC decreed plaintiffs as the owners of the
lands covered by TCT No. 30111 and declaring said title as VALID, BINDING AND EFFECTIVE, against the
whole world. Isabel Ronda, et al. (heirs of deceased farmer-beneficiary Mariano S. Ronda), Catalino Alcaide,
Julia Casaysayan, Chisan Uy, and the petitioner appealed to the CA. The defendant public officials did not
appeal. On their part, Catalino Alcaide, Julia Casaysayan, and Chisan Uy claimed that the RTC erred in
assuming jurisdiction over the case when in fact it had no such jurisdiction. In its decision, the CA ruled in
favor of respondents, hence denying the appeal. Hence, the petition for review on certiorari.
ISSUE: Whether or not the petitioner was a purchaser in good faith of the property in litis.

RULING: NO
The standard is that for one to be a purchaser in good faith in the eyes of the law, he should buy the
property of another without notice that some other person has a right to, or interest in, such property, and
should pay a full and fair price for the same at the time of such purchase, or before he has notice of the
claim or interest of some other persons in the property. He buys the property with the belief that the person
from whom he receives the property was the owner and could convey title to the property. Indeed, a
purchaser cannot close his eyes to facts that should put a reasonable man on his guard and still claim he
acted in good faith.
Such degree of proof of good faith, however, is sufficient only when the following conditions
concur: first, the seller is the registered owner of the land; second, the latter is in possession thereof; and third,
at the time of the sale, the buyer was not aware of any claim or interest of some other person in the property, or
of any defect or restriction in the title of the seller or in his capacity to convey title to the property.
Absent one or two of the foregoing conditions, then the law itself puts the buyer on notice and obliges
the latter to exercise a higher degree of diligence by scrutinizing the certificate of title and examining all factual
circumstances in order to determine the sellers title and capacity to transfer any interest in the property.
An examination of the deed of sale executed between Isabel Ronda, et al. and the petitioner respecting
the portions covered by TCT No. 31120 and TCT No. 31121 indicates that the TCTs were issued only on
August 17, 1998 but the deed of sale was executed on July 31, 1998. While it is true, as the petitioner argues,
that succession occurs from the moment of death of the decedent pursuant to Article 777 of the Civil Code, his
argument did not extend to whether or not he was a buyer in good faith, but only to whether or not, if at all,
Isabel Ronda, et al., as the heirs of Mariano Ronda, held the right to transfer ownership over their predecessors
property. The argument did not also address whether or not the transfer to the petitioner was valid.
Evidently, the petitioner entered into the deed of sale without having been able to inspect TCT No.
31120 and TCT No. 31121 by virtue of such TCTs being not yet in existence at that time. If at all, it was OCT
No. 9852 and OCT No. 9853 that were available at the time of the execution of the deed of sale, and such
OCTs were presumably inspected by petitioner before he signed the deed of sale. It is notable that said OCTs
categorically stated that they were entered pursuant to an emancipation patent of the Ministry of Agrarian
Reform pursuant to the Operation Land Transfer (OLT) Program of the government.
The foregoing circumstances negated the third element of good faith cited in Bautista v. Silva, i.e., that
at the time of sale, the buyer was not aware of any claim or interest of some other person in the property, or of
any defect or restriction in the title of the seller or in his capacity to convey title to the property.

The petitioner was not an innocent purchaser for value; hence, he cannot be awarded the
disputed land.
In view of the result thus reached by us, it becomes superfluous to settle the issue of which between
P.D. No. 27 and Section 27 of R.A. No. 6657 should control, and whether or not the R.A. No. 6657 has
repealed P.D. No. 27. Even so, the Court has expressly clarified that R.A. No. 6657 did not repeal or supersede
P.D. No. 27. Finally, the Court need not belabor the fact that R.A. 6657 or the CARP Law operates distinctly
from P.D. 27. R.A. 6657 covers all public and private agricultural land including other lands of the public
domain suitable for agriculture as provided for in Proclamation No. 131 and Executive Order No. 229; while,
P.D. 27 covers rice and corn lands. On this score, E.O. 229, which provides for the mechanism of the
Comprehensive Agrarian Reform Program, specifically states: Presidential Decree No. 27, as amended, shall
continue to operate with respect to rice and corn lands, covered thereunder. It cannot be gainsaid, therefore, that
R.A. 6657 did not repeal or supersede, in any way, P.D. 27. And whatever provisions of P.D. 27 that are not
inconsistent with R.A. 6657 shall be suppletory to the latter, and all rights acquired by the tenant-farmer under
P.D. 27 are retained even with the passage of R.A. 6657.

Aznar Brothers Realty Company vs. Sps. Jose and Magdalena Ybanez
G.R. No. 161380, April 21, 2014
BERSAMIN, J.:
Private ownership of land as when there is a prima facie proof of ownership like a duly registered possessory
information or a clear showing of open, continuous, exclusive, and notorious possession, by present or
previous occupants is not affected by the issuance of a free patent over the same land, because the Public
Land Law applies only to lands of the public domain. The Director of Lands has no authority to grant free
patent to lands that have ceased to be public in character and have passed to private ownership. Consequently,
a certificate of title issued pursuant to a homestead patent partakes of the nature of a certificate issued in a
judicial proceeding only if the land covered by it is really a part of the disposable land of the public domain.
FACTS:
Casimiro Ybaez with the marital consent of Maria Daclan, executed a Deed of Absolute Sale in favor
of Aznar Brothers conveying an unregistered agricultural land. The parties agreed to register the sale under Act
No. 3344.
Casimiro died intestate leaving as heirs his wife Maria, and their children. On August 29, 1977, the
heirs of Casimiro executed a document entitled Extrajudicial Declaration of Heirs with an Extrajudicial
Settlement of Estate of Deceased Person and Deed of Absolute Sale, whereby they divided and adjudicated
among themselves Lot No. 18563. By the same document, they sold the entire lot for P1,000.00 to their co-heir,
Adriano D. Ybaez. Adriano sold Lot No. 18563 to Jose R. Ybaez. Jose R. Ybaez filed Free Patent
Application in respect of the land he had bought from Adriano. In due course, on July 20, 1979, Original
Certificate of Title (OCT) No. 2150 was issued to Jose R. Ybaez.
Aznar Brothers filed in the RTC a complaint against Jose R. Ybaez claiming absolute ownership of
Lot No. 18563 by virtue of the Deed of Absolute Sale dated March 21, 1964 executed in its favor by Casimiro.
Jose R. Ybaez moved to dismiss the complaint of Aznar Brothers on the ground of lack of cause of action,
lack of jurisdiction over the nature of the action, and estoppel by laches. After Aznar Brothers opposed, the
RTC denied the motion to dismiss.
Aznar Brothers amended its complaint a second time to implead Jose R. Ybaezs wife Magdalena
Marcos-Ybaez as defendant, averring that both defendants held no legal right nor just title to apply for free
patent over the lot in question, for the land was no longer a public disposable agricultural land but a private
residential land that it already owned. Aznar Brothers sought a restraining order or a writ of preliminary
injunction to prevent the Spouses Ybaez from disposing of the land. It further sought the declaration as null
and void ab initio the Extrajudicial Declaration of Heirs with Extrajudicial Settlement of Estate of Deceased
Person and Deed of Absolute Sale.
The RTC admitted the second amended complaint, emphasizing that the original cause of action
of accion publiciana would not be changed because the second amended complaint would incorporate
additional but related causes of action, a change permitted only during the pre-trial stage. The RTC rendered
judgment declaring that the identity of the land sold to Aznar Brothers by Casimiro and the land sold by the
heirs of Casimiro to Jose R. Ybaez was not an issue anymore.

ISSUE: Whether or not the appeal will prosper.

RULING:
Identity of the lot in litis is no longer a proper issue herein
The CA and the RTC both held that the identity of the property in litis was no longer an issue to be
considered and determined because the parties did not raise it at the pre-trial. The Spouses Ybaez insist herein,
however, that the RTC and the CA should have made such a finding nonetheless in view of the materiality of
whether the land claimed by Aznar Brothers was different from Lot No. 18563, the land subject of their OCT
No. 2150.
We clarify that although the Spouses Ybaezs non-appeal barred them from assigning errors for
purposes of this review, they are not prevented from now insisting, if only to uphold the judgment of the CA
against Aznar Brothers, that the property in litis was not the same as Lot No. 18563, but they would not be
accorded any relief upon those reasons, even if the Court should find Aznar Brothers appeal unmeritorious or
utterly frivolous.hanrobleslaw
Regardless, the holding by both lower courts was proper and correct. The non-inclusion in the pre-trial
order barred the identity of the property in litis as an issue, for it is basic that any factual issue not included in
the pre-trial order will not be heard and considered at the trial, much less, on appeal. The parties had the
obligation to disclose during the pre-trial all the issues they intended to raise during the trial, except those
involving privileged or impeaching matters, for the rule is that the definition of issues during the pre-trial
conference will bar the consideration of others, whether during trial or on appeal.
The waiver of the identity of the property in litis as an issue did not violate the right of any of the
parties herein due to the Rules of Court having forewarned them in Section 7, Rule 18 of the Rules of Court that
should the action proceed to trial, the pre-trial order would explicitly define and limit the issues to be tried, and
its contents would control the subsequent course of the action, unless modified before trial to prevent manifest
injustice.
Moreover, for the Spouses Ybaez to call upon the Court now to analyze or weigh evidence all over
again upon such a factual matter would be impermissible considering that the Court is not a trier of facts. There
are exceptional instances in which the Court has held itself competent to make its own appreciation of the facts.
However, none of the aforementioned exceptions obtains in this case. Accordingly, the Court, just as the lower
courts have been bound, shall proceed upon the assumption that the property in litis and Lot No. 18563 were
one and the same realty.

CA correctly concluded that Aznar Brothers owned Lot No. 18563; and that the Spouses Ybaez were
not buyers in good faith
In its assailed judgment, the CA concluded that the RTC erred in holding in favor of the Spouses
Ybaez observing that the trial court erred when it held from the totality of the evidence adduced by the parties,
there is no preponderant evidence that the defendants had prior knowledge of the previous sale of subject
property to the plaintiff when they bought the same from Adriano D. Ybaez.
The Deed of Absolute Sale (Exhibit F) in favor of plaintiff-appellant Aznar was registered under Act
3344, as amended on March 23, 1964 with the Register of Deeds of Cebu City. The registration of said deed
gave constructive notice to the whole world including defendant-appellees of the existence of said deed of
conveyance. Defendant-appellees cannot, therefore, claim to be buyers in good faith of the land in question.
Resultantly, they merely stepped into the shoes of their sellers vis a vis said land. Since their sellers were not
owners of the property in question, there was nothing that they could have sold to defendant-appellees.
We sustain the CAs conclusion that the Spouses Ybaez were guilty of bad faith, and that they
acquired Lot No. 18563 from sellers who were not the owners. Accordingly, we resolve the second error raised
herein in favor of Aznar Brothers. The CA correctly found, that the Spouses Ybaez held no right to Lot No.
18563 because Adriano, their seller, and his siblings were not the owners of Lot No. 18563. Indeed, Casimiro
had absolutely conveyed his interest in Lot No. 18563 to Aznar Brothers under the Deed of Absolute Sale of
March 21, 1964 with the marital consent of Maria Daclan, Casimiros surviving spouse and the mother of
Adriano and his siblings.
There is also no question that the Spouses Ybaez were aware of the conveyance of Lot No. 18563 by
Casimiro to Aznar Brothers considering that the Deed of Absolute Sale of March 21, 1964 between Casimiro
and Aznar Brothers was registered in the book of registry of unregistered land on the same day pursuant to their
agreement. Such registration constituted a constructive notice of the conveyance on the part of the Spouses
Ybaez pursuant to Section 194 of the Revised Administrative Code of 1917, as amended by Act No. 3344.

Estoppel by laches did not bar Aznar Brothers right over Lot No. 18563
Unexpectedly, the CA disregarded its aforecited correct conclusion on Aznar Brothers ownership of
Lot No. 18563, and instead ruled that estoppel by laches had already barred Aznar Brothers dominical claim
over Lot No. 18563.
There is absolutely no doubt that in law, plaintiff-appellant had lost its dominical and possessory claim
over the land for its inaction from 1964 when it bought the land up to 1989 when it filed the Complaint in the
trial court or a long period of 25 years. This is called estoppel by laches. Aznar Brothers now assails this
adverse ruling under its first assigned error by pointing out that the CA erred in relying on estoppel by laches, a
rule of equity, to bar its dominical claim over Lot No. 18563. We hold and declare that the CAs ruling in
favor of the Spouses Ybaez was devoid of legal and factual support, and should be rightfully reversed. Laches
is the failure or neglect for an unreasonable and unexplained length of time to do that which by exerting due
diligence a party could and should have done earlier.
The CA incorrectly barred the claim of Aznar Brothers to Lot No. 18563 because of laches. For one,
Aznar Brothers immediately registered the purchase in accordance with Act No. 3344, the law then governing
the registration of unregistered land. Its action in that regard ensured the protection of the law as to its
ownership of the land, and evinced that it did not abandon its ownership. Verily, its maintaining Lot No. 18563
as an unregistered land from then on should not prejudice its rights; otherwise, its registration pursuant to law
would be set at naught. Secondly, the supposed acts of possession of Lot No. 18563 exercised by the Spouses
Ybaez from the time of their purchase from Adriano, including causing it to be surveyed for purposes of the
application for free patent, did not prejudice Aznar Brothers interest because the registration under Act No.
3344 had given constructive notice to the Spouses Ybaez of its prior acquisition of the land.

Lot No. 18563, not being land of the public domain, was not subject to the free patent
issued to the Spouses Ybaez
The Spouses Ybaezs position rests on their having been issued the free patent and OCT No. 2150.
The records do not support the position of the Spouses Ybaez. Aznar Brothers acquired Lot No. 18563 as the
private land of Casimiro. In their Deed of Absolute Sale of March 21, 1964, Casimiro expressly warranted that
the land was his own exclusive property. With the ownership of Aznar Brothers being thus established, the
free patent issued to Jose R. Ybaez by the Government was invalid for the reason that the Government had no
authority to dispose of land already in private ownership. The invalidity of the free patent necessarily left OCT
No. 2150 a patent nullity. As ruled in Heirs of Simplicio Santiago v. Heirs of Mariano E. Santiago: The settled
rule is that a free patent issued over a private land is null and void, and produces no legal effects
whatsoever. Private ownership of land as when there is a prima facie proof of ownership like a duly
registered possessory information or a clear showing of open, continuous, exclusive, and notorious
possession, by present or previous occupants is not affected by the issuance of a free patent over the same
land, because the Public Land Law applies only to lands of the public domain. The Director of Lands has no
authority to grant free patent to lands that have ceased to be public in character and have passed to private
ownership. Consequently, a certificate of title issued pursuant to a homestead patent partakes of the nature
of a certificate issued in a judicial proceeding only if the land covered by it is really a part of the disposable
land of the public domain.

Sps. Bernabe Mercader, Jr. and Lorna Mercader vs. Sps. Jesus Bardilas and Leticia Bardilas
G.R. No. 163157, June 27, 2016
BERSAMIN, J.:
The owner of the servient estate retains ownership of the portion on which the easement is established, and may
use the same in such manner as not to affect the exercise of the easement.
FACTS:
The issue concerns the right of way between the owners of three parcels of land denominated as Lot No. 5808-
F-l, Lot No. 5808-F-2-A and Lot 5808-F-2-B. The lots were portions of Lot No. 5808-F with an area of 2,530
square meters, and registeted under Transfer Certificate of Title No. 78424 of the Registry of Deeds in Cebu
City in the name of "Arsenia Fernandez, of legal age, married to Simeon Cortes, both Filipinos." Another
subdivision lot derived from Lot No. 5808-F was Lot No. 5808-F-3. On May 11, 1992, the Clarita Village
Association erected a concrete perimeter fence to close the exit point of the right of way of the Spouses
Bardilas from Lot No. 5808-F-2-B to the existing road within Clarita Village. The closure forced the Spouses
Bardilas to use the second exit to Buhisan Road, which is from their Lot No. 5808-F-3. Spouses Bardilas,
through Atty. Alfredo J. Sipalay, informed the Spouses Mercader of the encroachment by about 14 square
meters of the latter's residential house and fence on the right of way. Spouses Mercader, through Atty. Rolindo
A. Navarro, responded by insisting that as the owners of Lot No. 5808-F-2-A they were equally entitled to the
right of way; and that they were proposing to buy the equivalent portion of the right of way to which they were
entitled at a reasonable price. Spouses Bardilas rejected the claim of the Spouses Mercader that they were
entitled to the use of the right of way, and reiterated their demand for P30,000.00 as the fair market value of the
property. Finding the demand for payment of P30,000.00 by the Spouses Bardilas to be unlawful, unwarranted
and unfounded, the Spouses Mercader commenced on September 8, 1992 their action for declaratory relief,
injunction and damages against the Spouses Bardilas

ISSUE: Whether or not respondents are equally "entitled to the road-right-of-way being conferred upon them
by TITLE pursuant to Article 622 of the New Civil Code

RULING:
Easement or servitude is a real right constituted on another's property, corporeal and immovable, by virtue of
which the owner of the same has to abstain from doing or to allow somebody else to do something on his
property for the benefit of another thing or person. It exists only when the servient and dominant estates belong
to two different owners. It gives the holder of the easement an incorporeal interest on the land but grants no title
thereto. Therefore, an acknowledgment of the easement is an admission that the property belongs to another. It
is settled that road right of way is a discontinuous apparent easement in the context of Article 622 of the Civil
Code, which provides that continuous non-apparent easements, and discontinuous ones, whether apparent or
not, may be acquired only by virtue of title. But the phrase with existing Right of Way in the TCT is not one of
the modes of acquisition of the easement by virtue of a title. Acquisition by virtue of title, as used in Art. 622 of
the Civil Code, refers to "the juridical act which gives birth to the easement, such as law, donation, contract,
and will of the testator."
What really defines a piece of land is not the area mentioned in its description, but the boundaries therein laid
down, as enclosing the land and indicating its limits. An encumbrance "subject to 3 meters wide right of way"
was annotated on TCT No. 107915, which covers Lot No. 5808-F2-B of the Spouses Bardilas. As the owners
of the servient estate, the Spouses Bardilas retained ownership of the road right of way even assuming that said
encumbrance was for the benefit of Lot No. 5808-F-2-A of the Spouses Mercader. The latter could not claim to
own even a portion of the road right of way because Article 630 of the Civil Code expressly provides that "[t]he
owner of the servient estate retains ownership of the portion on which the easement is established, and may use
the same in such manner as not to affect the exercise of the easement." With the right of way rightfully
belonging to them as the owners of the burdened property, the Spouses Bardilas remained entitled to avail
themselves of all the attributes of ownership under the Civil Code.

Republic of the Philippines vs. Apolonio Bautista Jr.

G.R. No. 166890, June 28, 2016
BERSAMIN, J.:
The applicant for judicial confirmation of imperfect title must trace his possession of the subject land to June
12, 1945, or earlier. Any length of possession that does not comply with the requirement cannot support the
application, which must be then dismissed for failure to comply with Commonwealth Act No. 141 (Public Land
Act) and Presidential Decree No. 1529 (Property Registration Decree).
FACTS:
After acquiring Lot 17078 of Cad. 547-D, Subic Cadastre, located in Capisanan, Subic, Zambales from Mario
Jardin on February 15, 1971 and Cornelia Villanueva on May 25, 1973, Apolonio, Sr. had the property declared
for taxation purposes. He had been the sole and exclusive possessor and occupant from the time of acquisition
until his death, with no party questioning his possession and ownership, or staking any adverse claim against
him thereon. He died in 1987, and was succeeded by his children, namely: respondent Apolonio, Jr. and his
siblings. Apolonio, Sr.'s children executed an extra-judicial settlement of their father's estate, whereby
Apolonio, Jr. 's brothers and sisters waived their rights in his favor. Thus, the property was declared for taxation
purposes in Apolonio, Jr. 's name under Tax Declaration No. 014-0432A of the Municipality of Subic,
Zambales. There were no arrears in real estate taxes. The declared value was P73,040.00. On October 21, 1996,
Apolonio Jr. commenced LRC Case No. N-1210-96 in the MTC. He later on testified that his father had been in
actual possession since 1969, and had eventually acquired the land from Jardin and Villanueva through the
notarized Deeds of Absolute Sale dated February 15, 1971, and May 25, 1973; and that his father had paid
taxes on the land.

ISSUE: Whether or not Apolonio is entitled to the land

RULING:
In its amendment of the Public Land Act that took effect on January 25, 1977, Presidential Decree No. 1073
changed the length of the requisite possession from "thirty (30) years immediately preceding the filing of the
application" to possession "since June 12, 1945, or earlier. Apolonia, Jr. presented only himself to establish the
possession and ownership of his father, Apolonia, Sr., who was his immediate predecessor-in-interest. He did
not present as witnesses during the trial either of the transferors of Apolonia, Sr. -that is, Mario Jardin or
Cornelia Villanueva -to establish the requisite length of the possession of the predecessors-in-interest of the
applicant that would be tacked to his own. His personal incompetence to attest to the possession of the property
within the time required by law underscored the weakness of the evidence on possession, particularly as it has
not been denied that the applicant had arrived in the Philippines only on November 28, 1987. Considering that
the possession and occupation of the property in question by Apolonia, Jr. and his predecessors-in-interest were
not shown in the records to have been "since June 12, 1945, or earlier," the application must be rejected. Only
the title of those who had possessed and occupied alienable and disposable lands of the public domain within
the requisite period could be judicially confirmed. Indeed, alienable public land held by a possessor, either
personally or through his predecessors-in-interest, openly, continuously and exclusively during the prescribed
statutory period is converted to private property by the mere lapse or completion of the period

Obligations and Contracts

Spouses Quirino Dela Cruz and Gloria Dela Cruz vs. Planters Products, Inc.
G.R. No. 158649, February 18, 2013
BERSAMIN, J.:
If the terms of a contract are clear and leave no doubt upon the intention of the contracting parties, the literal
meaning of its stipulations shall control. In determining their intention, their contemporaneous and subsequent
acts shall be principally considered.
FACTS:
Spouses Quirino V. Dela Cruz and Gloria Dela Cruz operated the Barangay Agricultural Supply, an agricultural
supply store in Aliaga, Nueva Ecija engaged in the distribution and sale of fertilizers and agricultural chemical
products, among others. At the time material to the case, Quirino, a lawyer, was the Municipal Mayor of
Aliaga, Nueva Ecija. Gloria applied for and was granted by respondent Planters Products, Inc. (PPI) a regular
credit line of P200,000.00 for a 60-day term, with trust receipts as collaterals. Quirino and Gloria submitted a
list of their assets in support of her credit application for participation in the Special Credit Scheme (SCS) of
PPI. Gloria signed in the presence of the PPI distribution officer/assistant sales representative two documents
labelled Trust Receipt/Special Credit Scheme, indicating the invoice number, quantity, value, and names of
the agricultural inputs (i.e., fertilizer or agricultural chemicals) she received upon the trust of PPI.

ISSUE: Whether the two transaction documents signed by Gloria expressed the intent of the parties to establish
a creditor-debtor relationship between them

RULING:
Parties entered into a creditor-debtor relationship
Gloria signed the application for credit facilities, indicating that a trust receipt would serve as collateral for the
credit line. On August 4, 1978, Gloria, as dealer, signed together with Quirino the list of their assets having a
total value of P260,000.00 that they tendered to PPI to support our credit application in connection with our
participation to your Special Credit Scheme. Gloria further signed the Trust Receipt/SCS documents defining
her obligations under the agreement, and also the invoices pursuant to the agreement with PPI, indicating her
having received PPI products on various dates. These established circumstances comprised by the
contemporaneous and subsequent acts of Gloria and Quirino that manifested their intention to enter into the
creditor-debtor relationship.
Credit line of P200,000.00 commenced the business relationship between the parties. A credit line is really a
loan agreement between the parties. Gloria offered trust receipts as her collateral for securing the loans that PPI
extended to her. Gloria and Quirino offered to have their conjugal real properties beef up the collaterals for the
credit line. A close look at the Trust Receipt/SCS indicates that the farmer-participants were mentioned therein
only with respect to the duties and responsibilities that Gloria personally assumed to undertake in holding
goods in trust for PPI. At this juncture, the Court clarifies that the contract, its label notwithstanding, was not a
trust receipt transaction in legal contemplation or within the purview of the Trust Receipts Law (Presidential
Decree No. 115) such that its breach would render Gloria criminally liable for estafa. The petitioners could not
validly justify the non-compliance by Gloria with her obligations under the Trust Receipt/SCS by citing the
loss of the farm outputs due to typhoon Kading. There is no question that she had expressly agreed that her
liability would not be extinguished by the destruction or damage of the crops.

Heirs of Servando Franco vs. Sps. Veronica and Danilo Gonzales

G.R. No. 159709, June 27, 2012
BERSAMIN, J.:
There is novation when there is an irreconcilable incompatibility between the old and the new obligations.
There is no novation in case of only slight modifications; hence, the old obligation prevails.
FACTS:
Servando Franco and Leticia Medel obtained a loan from Veronica R. Gonzales, who was engaged in the
money lending business under the name Gonzales Credit Enterprises, in the amount of P50,000.00, payable in
two months. Veronica gave only the amount of P47,000.00, to the borrowers, as she retained P3,000.00, as
advance interest for one month at 6% per month. Servado and Leticia executed a promissory note
for P50,000.00, to evidence the loan, payable on January 7, 1986. Servando and Leticia obtained from Veronica
another loan in the amount of P90,000.00, payable in two months, at 6% interest per month. They executed a
promissory note to evidence the loan, maturing on January 19, 1986. They received only P84,000.00, out of
the proceeds of the loan. On maturity of the two promissory notes, the borrowers failed to pay the indebtedness.
Servando and Leticia secured from Veronica still another loan in the amount of P300,000.00, maturing in one
month, secured by a real estate mortgage over a property belonging to Leticia Makalintal Yaptinchay, who
issued a special power of attorney in favor of Leticia Medel, authorizing her to execute the mortgage.
Servando and Leticia executed a promissory note in favor of Veronica to pay the sum of P300,000.00, after a
month, or on July 11, 1986. However, only the sum of P275,000.00, was given to them out of the proceeds of
the loan. Like the previous loans, Servando and Medel failed to pay the third loan on maturity. Servando and
Leticia with the latter's husband, Dr. Rafael Medel, consolidated all their previous unpaid loans
totaling P440,000.00, and sought from Veronica another loan in the amount of P60,000.00, bringing their
indebtedness to a total of P500,000.00, payable on August 23, 1986. He borrowers failed to pay their
obligations. Veronica R. Gonzales, joined by her husband Danilo G. Gonzales, filed with the Regional Trial
Court a complaint for collection of the full amount of the loan including interests and other charges.
The Court in Medel v. Court of Appeals struck down as void the stipulation on the interest for being
iniquitous or unconscionable. Upon the finality of the decision in Medel v. Court of Appeals, the respondents
moved for execution. Servando Franco opposed, claiming that he and the respondents had agreed to fix the
entire obligation at P775,000.00. According to Servando, their agreement, which was allegedly embodied in a
receipt dated February 5, 1992, whereby he made an initial payment of P400,000.00 and promised to pay the
balance of P375,000.00 on February 29, 1992, superseded the July 23, 1986 promissory note.

ISSUE: Was there a novation of the August 23, 1986 promissory note when respondent Veronica Gonzales
issued the February 5, 1992 receipt?

RULING:
Novation did not transpire because no irreconcilable incompatibility existed between the promissory
note and the receipt
A novation arises when there is a substitution of an obligation by a subsequent one that extinguishes the first,
either by changing the object or the principal conditions, or by substituting the person of the debtor, or by
subrogating a third person in the rights of the creditor. For a valid novation to take place, there must be,
therefore: (a) a previous valid obligation; (b) an agreement of the parties to make a new contract; (c) an
extinguishment of the old contract; and (d) a valid new contract. In short, the new obligation extinguishes the
prior agreement only when the substitution is unequivocally declared, or the old and the new obligations are
incompatible on every point. A compromise of a final judgment operates as a novation of the judgment
obligation upon compliance with either of these two conditions. The receipt dated February 5, 1992 did not
create a new obligation incompatible with the old one under the promissory note. Novation is not presumed.
This means that the parties to a contract should expressly agree to abrogate the old contract in favor of a new
one. In the absence of the express agreement, the old and the new obligations must be incompatible on every
point.
The issuance of the receipt created no new obligation. Instead, the respondents only thereby recognized
the original obligation by stating in the receipt that the P400,000.00 was partial payment of loan and by
referring to the promissory note subject of the case in imposing the interest. The loan mentioned in the receipt
was still the same loan involving the P500,000.00 extended to Servando. Advertence to the interest stipulated in
the promissory note indicated that the contract still subsisted, not replaced and extinguished, as the petitioners
claim. A new contract that is a mere reiteration, acknowledgment or ratification of the old contract with slight
modifications or alterations as to the cause or object or principal conditions can stand together with the former
one, and there can be no incompatibility between them.

Landbank of the Philippines vs. Heirs of Sps. Jorja Soriano and Magin Soriano
G.R. No. 178312, January 30, 2013
BERSAMIN, J.:
The validity of a compromise is dependent upon its compliance with the requisites and principles of contracts
dictated by law. Also, the terms and conditions of a compromise must not be contrary to law, morals, good
customs, public policy and public order.
FACTS:
The respondents are the children of the late Spouses Jorja Rigor-Soriano and Magin Soriano, the owners of the
two parcels of land, both of the Registry of Deeds of Nueva Ecija, containing an area of 10.9635 hectares
located in Poblacion/Talabutab, Gen. Natividad, Nueva Ecija and 4.1224 hectares located in Macabucod,
Aliaga, Nueva Ecija, respectively. The properties became subject to Operation Land Transfer (OLT) and were
valued by the Land Bank and the Department of Agrarian Reform (DAR) at P10,000.00/hectare. Contending,
however, that such valuation was too low compared to existing valuations of agricultural lands, the respondents
commenced this action for just compensation, claiming that the properties were irrigated lands that usually
yielded 150 cavans per hectare per season at a minimum of two seasons per year. They asked that a final
valuation of the properties be pegged at P1,800,000.00, based on Administrative Order No. 61, Series of 1992
and Republic Act No. 6657. Land Bank disagreed, insisting that Presidential Decree No. 27 and Executive
Order No. 228 governed the fixing of just compensation for the properties; that the Government, through the
DAR as the lead agency in the implementation of all agrarian laws, had taken the properties in 1972 pursuant to
Presidential Decree No. 27, and had since then redistributed the properties to farmer-beneficiaries; and that in
all cases under Presidential Decree No. 27 and Executive Order No. 228, its participation was only to pay the
landowners accepting the valuations fixed by the DAR, upon the latters direction and in the amounts the DAR
determined. It prayed that the valuation by the DAR be retained or that a valuation be made judicially. RTC
rendered a decision ordering Landbank to pay P1,227,571.10. Land Bank submitted to the Court a so-called
Joint Manifestation and Motion (Re: Unconditional Acceptance of Revaluation) stating that the approval by
Land Banks responsible officers of the revaluation of the properties was communicated to the respondents for
their unconditional acceptance. Court received the Joint Motion to Approve the Attached Agreement and the
Agreement. Thereby, the parties prayed that the Court consider and approve the Agreement.

ISSUE: Whether or not there has been a compromise between the parties

RULING: Yes
There is no question that the foregoing Agreement was a compromise that the parties freely and voluntarily
entered into for the purpose of finally settling their dispute in this case. Under Article 2028 of the Civil Code, a
compromise is a contract whereby the parties, by making reciprocal concessions, avoid a litigation or put an
end to one already commenced. Accordingly, a compromise is either judicial, if the objective is to put an end
to a pending litigation, or extrajudicial, if the objective is to avoid a litigation. As a contract, a compromise is
perfected by mutual consent. However, a judicial compromise, while immediately binding between the parties
upon its execution, is not executory until it is approved by the court and reduced to a judgment. The validity of
a compromise is dependent upon its compliance with the requisites and principles of contracts dictated by law.
Also, the terms and conditions of a compromise must not be contrary to law, morals, good customs, public
policy and public order. A review of the terms of the Agreement indicates that it is a judicial compromise
because the parties intended it to terminate their pending litigation by fully settling their dispute. Indeed, with
the respondents thereby expressly signifying their unconditional or absolute acceptance and full receipt of the
foregoing amounts as just compensation for subject properties the First Party and the Second Party hereby
consider the case titled Land Bank of the Philippines v. Heirs of Spouses Jorja Rigor-Soriano and Magin
Soriano, namely: Marivel S. Carandang and Joseph Soriano (G.R. No. 178312) pending before the Supreme
Court, closed and terminated, the ultimate objective of the action to determine just compensation for the
landowners was achieved.

Domingo Gonzalo vs. John Tarnate Jr.

G.R. No. 160600, January 15, 2014
BERSAMIN, J.:
The doctrine of in pari delicto which stipulates that the guilty parties to an illegal contract are not entitled to
any relief, cannot prevent a recovery if doing so violates the public policy against unjust enrichment.
FACTS:
After the Department of Public Works and Highways (DPWH) had awarded the contract for the
improvement of the Sadsadan-Maba-ay Section of the Mountain Province-Benguet Road to his company,
Gonzalo Construction, petitioner subcontracted to respondent John Tarnate, Jr. (Tarnate) the supply of
materials and labor for the project. Gonzalo also executed a deed of assignment whereby he, as the contractor,
was assigning to Tarnate an amount equivalent to 10% of the total collection from the DPWH for the project as
the rent for Tanates equipment that had been been utilized in the project.
However, Tarnate learned that Gonzalo had unilaterally rescinded the deed of assignment, and that the
disbursement voucher for the 10% retention fee had then been issued in the name of Gonzalo, and the retention
fee released to him. Tarnate demanded the payment of the retention fee from Gonzalo, but to no avail,
prompting him to file a suit against Gonzalo to recover the retention fee moral and exemplary damages for
breach of contract, and attorneys fees. For his defense, Gonzalo argued that Tarnate, having been fully aware
of the illegality and ineffectuality of the deed of assignment from the time of its execution, could not go to
court with unclean hands to invoke any right based on the invalid deed of assignment or on the product of such
deed of assignment.

ISSUE:
Whether or not the doctrine of in pari delicto will prevent Tarnate from recovering the retention fee from
Gonzalo.

RULING: NO.
Pursuant to Section 6 of Presidential Decree No. 1594, every contractor is prohibited from
subcontracting with or assigning to another person any contract or project that he has with the DPWH unless
the DPWH Secretary has approved the subcontracting or assignment.
Their subcontract was illegal, therefore, because it did not bear the approval of the DPWH Secretary.
Necessarily, the deed of assignment was also illegal, because it sprung from the subcontract. The illegality of
the Sub-Contract Agreement necessarily affects the Deed of Assignment because the rule is that an illegal
agreement cannot give birth to a valid contract.
According to Article 1412 (1) of the Civil Code, the guilty parties to an illegal contract cannot recover
from one another and are not entitled to an affirmative relief because they are in pari delicto or in equal fault.
The doctrine of in pari delicto is a universal doctrine, such that, where the parties are in pari delicto, no
affirmative relief of any kind will be given to one against the other. Nonetheless, the application of the doctrine
of in pari delicto is not always rigid. An accepted exception arises when its application contravenes well-
established public policy. The prevention of unjust enrichment is a recognized public policy of the State, for
Article 22 of the Civil Code explicitly provides that "[e]very person who through an act of performance by
another, or any other means, acquires or comes into possession of something at the expense of the latter without
just or legal ground, shall return the same to him.
There is no question that Tarnate provided the equipment, labor and materials for the project
obligations under the subcontract and the deed of assignment; and that it was Gonzalo as the contractor who
received the payment for his contract with the DPWH as well as the 10% retention fee that should have been
paid to Tarnate. Gonzalo would be unjustly enriched at the expense of Tarnate if the latter was to be barred
from recovering because of the rigid application of the doctrine of in pari delicto.
The doctrine of in pari delicto which stipulates that the guilty parties to an illegal contract are not entitled to
any relief, cannot prevent a recovery if doing so violates the public policy against unjust enrichment.
On the other hand, the grant of moral damages, attorneys fees and litigation expenses to Tarnate to be
inappropriate. No damages may be recovered under a void contract, which, being nonexistent, produces no
juridical tie between the parties involved. Lastly, the letter and spirit of Article 22 of the Civil Code command
Gonzalo to make a full reparation or compensation to Tarnate. The illegality of their contract should not be
allowed to deprive Tarnate from being fully compensated through the imposition of legal interest.

First United Constructors Corporation and Blue Star Construction Corporation vs. Bayanihan
Automotive Corporation
G.R. No. 164985, January 15, 2014
BERSAMIN, J.:
The legal basis for recoupment by the buyer is the first paragraph of Article 1599 of the Civil Code.
Legal compensation takes place when the requirements set forth in Article 1278 and Article 1279 of the Civil
Code are present.
FACTS:
From May 27, 1992 to July 8, 1992, petitioner First United Constructors Corporation and petitioner
Blue Star Construction Corporation ordered six units of dump trucks from the respondent. For two consecutive
purchases (Hino Prime Mover and Isuzu Transit Mixer respectively), FUCC partially paid in cash, and the
balance through post-dated checks, The respondent learned that FUCC had ordered the payment stopped upon
presentment of checks for payment, hence, it demanded for the full settlement of their obligation from, but to
no avail. Instead, the petitioners informed them that they were withholding payment of the checks due to the
breakdown of the second dump truck they had earlier purchased from respondent.
Due to the refusal to pay, the respondent commenced this action for collection of the unpaid balance
represented by the two checks. RTC rendered its judgment, ordering petitioners to pay for the unpaid balance
of the purchase price of the Hino Prime Mover and the Isuzu Transit Mixer with legal interest and attorneys
fees; and declaring the respondent liable to pay the petitioners the costs of the repairs incurred by the
petitioners. The RTC held that the petitioners could not avail themselves of legal compensation because the
claims they had set up in the counterclaim were not liquidated and demandable.

ISSUES:
Whether or not the petitioners can validly exercise the right of recoupment.
Whether or not the costs of the repairs and spare parts for the second dump truck could be offset for the
petitioners obligations to the respondent.

RULING:
Petitioners could not validly resort to recoupment against respondent.
The legal basis for recoupment by the buyer is the first paragraph of Article 1599 of the Civil Code.
Defendants-appellants act of ordering the payment on the prime mover and transit mixer stopped was improper
considering that the said sale was a different contract from that of the dump trucks earlier purchased by
defendants-appellants.
 The claim of defendants-appellants for breach of warranty, i.e. the expenses paid for the repair and spare
parts of dump truck no. 2 is therefore not a proper subject of recoupment since it does not arise out of the
contract or transaction sued on or the claim of plaintiff-appellee for unpaid balances on the last two (2)
purchases, i. e. the prime mover and the transit mixer. Recoupment must arise out of the contract or transaction
upon which the plaintiffs claim is founded. To be entitled to recoupment, therefore, the claim must arise from
the same transaction, i.e., the purchase of the prime mover and the transit mixer and not to a previous contract
involving the purchase of the dump truck.

Legal compensation was permissible

Legal compensation takes place when the requirements set forth in Article 1278 and Article 1279 of the
Civil Code are present. Considering that preponderant evidence showing that petitioners had spent the amount
of P71,350.00 for the repairs and spare parts of the second dump truck within the warranty period of three
months supported the finding of the two lower courts, the Court accepts their finding.
A debt is liquidated when its existence and amount are determined. Accordingly, an unliquidated claim set
up as a counterclaim by a defendant can be set off against the plaintiffs claim from the moment it is liquidated
by judgment.. With petitioners expenses for the repair of the dump truck being already established and
determined with certainty by the lower courts, it follows that legal compensation could take place because all
the requirements were present.

Roberto David vs. Eduardo David

G.R. No. 162365, January 15, 2014
BERSAMIN, J.:
Redemption within the period allowed by law is not a matter of intent but of payment or valid tender of the full
redemption price within the period. Verily, the tender of payment is the sellers manifestation of his desire to
repurchase the property with the offer of immediate performance.
FACTS:
Eduardo and his brother Edwin C. David sold their inherited properties to Roberto, specifically: (a) a
parcel of land together with all the improvements existing thereon, located in Baguio City; and (b) two units
International CO 9670 Truck Tractor with two Mi-Bed Trailers. The parties further agreed to give Eduardo and
Edwin the right to repurchase the properties within a period of three years from the execution of the deed of
sale based on the purchase price agreed upon, plus 12% interest per annum.
5
In April 1997, Roberto and Edwin executed a memorandum of agreement (MOA) with the Spouses
Go, by which they agreed to sell the Baguio City lot to the latter. Roberto gave Eduardo P2,800,000.00 and
returned to him one of the truck tractors and trailers subject of the deed of sale. Eduardo demanded for the
return of the other truck tractor and trailer, but Roberto refused to heed the demand. Thus, Eduardo initiated
this replevin suit against Roberto. Roberto denied that Eduardo could repurchase the properties in question; and
insisted that the MOA had extinguished their deed of sale by novation. The RTC rendered judgment in favor of
Eduardo. On appeal, the CA promulgated its decision affirming the RTC. Hence, this petition for review
on certiorari.

ISSUES:
Whether or not Eduardo can exercise the right of repurchase.
Whether or not the MOA had extinguished the obligations established under the deed of sale by novation.

RULING:
YES.
A sale with right to repurchase is governed by Article 1601 of the Civil Code. The CA and the RTC both
found and held that Eduardo had complied with the conditions stipulated in the deed of sale and prescribed by
Article 1616 of the Civil Code. Pertinently, the CA stated: It should be noted that the alleged repurchase was
exercised within the stipulated period of three (3) years from the time the Deed of Sale with Assumption of
Mortgage was executed. From the testimony of the defendant himself, the preconditions for the exercise of
plaintiffs right to repurchase were adequately satisfied by the latter. Redemption within the period allowed by
law is not a matter of intent but of payment or valid tender of the full redemption price within the period.
Verily, the tender of payment is the sellers manifestation of his desire to repurchase the property with the offer
of immediate performance. Here, Eduardo paid the repurchase price to Roberto by depositing the proceeds of
the sale of the Baguio City lot in the latters account. Such payment was an effective exercise of the right to
repurchase.

The issue of novation involves a question of fact, as it necessarily requires the factual determination of the
existence of the various requisites of novation, namely: (a) there must be a previous valid obligation; (b) the
parties concerned must agree to a new contract; (c) the old contract must be extinguished; and (d) there must be
a valid new contract.
In sales with the right to repurchase, the title and ownership of the property sold are immediately
vested in the vendee, subject to the resolutory condition of repurchase by the vendor within the stipulated
period. Accordingly, the ownership of the affected properties reverted to Eduardo once he complied with the
condition for the repurchase, thereby entitling him to the possession of the other motor vehicle with trailer.

Asb Realty Corporation vs. Ortigas & Company Limited Partnership

G.R. No. 202947, December 9, 2015
BERSAMIN, J.:
The doctrine of estoppel was based on public policy, fair dealing, good faith and justice, and its purpose was to
forbid a party to speak against his own act or omission, representation, or commitment to the injury of another
to whom the act, omission, representation, or commitment was directed and who reasonably relied thereon.
The doctrine sprang from equitable principles and the equities in the case, and was designed to aid the law in
the administration of justice where without its aid injustice would result. Estoppel has been applied by the
Court wherever and whenever special circumstances of the case so demanded.
FACTS:
Ortigas & Company Limited Partnership entered into a Deed of Sale with Amethyst Pearl Corporation
involving the parcel of land with an area of 1,012 square meters situated in Barrio Oranbo, Pasig City and
registered under Transfer Certificate of Title (TCT) No. 65118 of the Register of Deeds of Rizal4 for the
consideration of P2,024,000.00. Amethyst assigned the subject property to its sole stockholder, petitioner ASB
Realty Corporation (the petitioner), under a so-called Deed of Assignment in Liquidation in consideration of
10,000 shares of the petitioners outstanding capital stock. Thus, the property was transferred to the petitioner
free from any liens or encumbrances except those duly annotated on TCT No. PT-94175. The Register of
Deeds of Rizal cancelled TCT No. PT-94175 and issued TCT No. PT-105797 in the name of the petitioner with
the same encumbrances annotated on TCT No. PT-94175. Ortigas filed its complaint for specific performance
against the petitioner. For reliefs, Ortigas prayed for the reconveyance of the subject property, or, alternatively,
for the demolition of the structures and improvements thereon, plus the payment of penalties, attorneys fees
and costs of suit.

ISSUE: Whether or not Ortigas action for rescission would prosper

RULING:
Ortigas action for rescission could not prosper
The express terms of the Deed of Assignment in Liquidation, indicate that Amethyst transferred to the
petitioner only the tangible asset consisting of the parcel of land covered by TCT No. PT-94175 registered in
the name of Amethyst. By no means did Amethyst assign the rights or duties it had assumed under the Deed of
Sale. The petitioner thus became vested with the ownership of the parcel of land free from any lien or
encumbrance except those that are duly annotated on the [title] from the time Amethyst executed the Deed of
Assignment in Liquidation. Ortigas apparently recognized without any reservation the issuance of the new
certificate of title in the name of Amethyst and the subsequent transfer by assignment from Amethyst to the
petitioner that resulted in the issuance of the new certificate of title under the name of the petitioner. As such,
Ortigas was estopped from assailing the petitioners acquisition and ownership of the property.
The application of estoppel was appropriate. The doctrine of estoppel was based on public policy, fair dealing,
good faith and justice, and its purpose was to forbid a party to speak against his own act or omission,
representation, or commitment to the injury of another to whom the act, omission, representation, or
commitment was directed and who reasonably relied thereon. The doctrine sprang from equitable principles
and the equities in the case, and was designed to aid the law in the administration of justice where without its
aid injustice would result. Estoppel has been applied by the Court wherever and whenever special
circumstances of the case so demanded.
Substitution of the petitioner in the place of Amethyst did not result in the novation of the Deed of Sale. To
start with, it does not appear from the records that the consent of Ortigas to the substitution had been obtained
despite its essentiality to the novation. Secondly, the petitioner did not expressly assume Amethysts
obligations under the Deed of Sale, whether through the Deed of Assignment in Liquidation or another
document. And, thirdly, the consent of the new obligor (i.e., the petitioner), which was as essential to the
novation as that of the obligee (i.e., Ortigas), was not obtained. Rescission under Article 1191 of the Civil Code
is proper if one of the parties to the contract commits a substantial breach of its provisions. It abrogates the
contract from its inception and requires the mutual restitution of the benefits received; hence, it can be carried
out only when the party who demands rescission can return whatever he may be obliged to restore. Ortigas did
not have a cause of action against the petitioner for the rescission of the Deed of Sale.

Megaworld Properties and Holdings Inc. et al vs. Majestic Finance and Investment Co.
G.R. No. 169694, December 9, 2015
BERSAMIN, J.:
In each activity, the obligation of each party was dependent upon the obligation of the other. Although their
obligations were to be performed simultaneously, the performance of an activity obligation was still
conditioned upon the fulfillment of the continuous obligation, and vice versa. Should either party cease to
perform a continuous obligation, the other's subsequent activity obligation would not accrue. Conversely, if an
activity obligation was not performed by either party, the continuous obligation of the other would cease to
take effect. The performance of the continuous obligation was subject to the resolutory condition that the
precedent obligation of the other party, whether continuous or activity, was fulfilled as it became due.
Otherwise, the continuous obligation would be extinguished.
FACTS:
Megaworld Properties and Holdings, Inc. (developer) entered into a Joint Venture Agreement (JVA) with
Majestic Finance and Investment Co., Inc. (owner) for the development of the residential subdivision located in
Brgy. Alingaro, General Trias, Cavite. According to the JV A, the development of the 215 hectares of land
belonging to the owner (joint venture property) would be for the sole account of the developer; and that upon
completion of the development of the subdivision, the owner would compensate the developer in the form of
saleable residential subdivision lots.6 The JV A further provided that the developer would advance all the costs
for the relocation and resettlement of the occupants of the joint venture property, subject to reimbursement by
the owner; and that the developer would deposit the initial amount of P10,000,000.00 to defray the expenses for
the relocation and settlement, and the costs for obtaining from the Government the exemptions and conversion
permits, and the required clearances.
The developer and owner agreed, through the addendum to the JV A, to increase the initial deposit for the
settlement of claims and the relocation of the tenants from P10,000,000.00 to P160,000,000.00. The developer,
by deed of assignment, transferred, conveyed and assigned to Empire East Land Holdings, Inc.
(developer/assignee) all its rights and obligations under the JV A including the addendum. The owner filed in
the RTC a complaint for specific performance with damages against the developer, the developer/assignee, and
respondent Andrew Tan, who are now the petitioners herein. The complaint was mainly based on the failure of
the petitioners to comply with their obligations under the JV A.

ISSUE: whether either party of a joint venture agreement to develop property into a residential subdivision has
already performed its obligation as to entitle it to demand the performance of the other's reciprocal obligation

RULING:
The obligations of the parties under the JV A were unquestionably reciprocal. Reciprocal obligations are those
that arise from the same cause, and in which each party is a debtor and a creditor of the other at the same time,
such that the obligations of one are dependent upon the obligations of the other. They are to be performed
simultaneously, so that the performance by one is conditioned upon the simultaneous fulfillment by the other.
The determination of default on the part of either of the parties depends on the terms of the JV A that clearly
categorized the parties' several obligations.
In each activity, the obligation of each party was dependent upon the obligation of the other. Although their
obligations were to be performed simultaneously, the performance of an activity obligation was still
conditioned upon the fulfillment of the continuous obligation, and vice versa. Should either party cease to
perform a continuous obligation, the other's subsequent activity obligation would not accrue. Conversely, if an
activity obligation was not performed by either party, the continuous obligation of the other would cease to take
effect. The performance of the continuous obligation was subject to the resolutory condition that the precedent
obligation of the other party, whether continuous or activity, was fulfilled as it became due. Otherwise, the
continuous obligation would be extinguished.
According to Article 1184 of the Civil Code, the condition that some event happen at a determinate time shall
extinguish the obligation as soon as the time expires, or if it has become indubitable that the event will not take
place. Here, the common cause of the parties in entering into the joint venture was the development of the joint
venture property into the residential subdivision as to eventually profit therefrom. Consequently, all of the
obligations under the JVA were subject to the happening of the complete development of the joint venture
property, or if it would become indubitable that the completion would not take place, like when an obligation,
whether continuous or activity, was not performed. Should any of the obligations, whether continuous or
activity, be not performed, all the other remaining obligations would not ripen into demandable obligations
while those already performed would cease to take effect. This is because every single obligation of each party
under the JV A rested on the common cause of profiting from the developed subdivision.
It appears that upon the execution of the JV A, the parties were performing their respective obligations until
disagreement arose between them that affected the subsequent performance of their accrued obligations. Being
reciprocal in nature, their respective obligations as the owner and the developer were dependent upon the
performance by the other of its obligations; hence, any claim of delay or non-performance against the other
could prosper only if the complaining party had faithfully complied with its own correlative obligation.

Mactan Cebu International Airport vs. Heirs of Gavina Ijordan

G.R. No. 173140, January 11, 2016
BERSAMIN, J.:
A sale of jointly owned real property by a co-owner without the express authority of the others is unenforceable
against the latter, but valid and enforceable against the seller.
FACTS:
Julian Chizon (Julian) executed a Deed of Extrajudicial Settlement and Sale (Deed) covering Lot No. 4539
(subject lot) situated in Ibo, Municipality of Opon (now Lapu-Lapu City) in favor of the Civil Aeronautics
Administration (CAA), the predecessor-in-interest of petitioner Manila Cebu International Airport Authority
(MCIAA). Since then until the present, MCIAA remained in material, continuous, uninterrupted and adverse
possession of the subject lot through the CAA, later renamed the Bureau of Air Transportation (BAT), and is
presently known as the Air Transportation Office (ATO). The subject lot was transferred and conveyed to
MCIAA by virtue of Republic Act No. 6958. Respondents caused the judicial reconstitution of the original
certificate of title covering the subject lot (issued by virtue of Decree No. 531167). Consequently, Original
Certificate of Title (OCT) No. R0-2431 of the Register of Deeds of Cebu was reconstituted for Lot No. 4539 in
the names of the respondents' predecessors-in-interest. They asserted that they had not sold their shares in the
subject lot, and had not authorized Julian to sell their shares to MCIAA's predecessor-in-interest.

ISSUE: Was the subject lot validly conveyed in its entirety to the petitioner

RULING:
Both the CA and the RTC found the Deed and the Tax Declaration with which MCIAA would buttress its right
to the possession and ownership of the subject lot insufficient to substantiate the right of MCIAA to the relief
sought. CA and the RTC concluded that the Deed was void as far as the respondents' shares in the subject lot
were concerned, but valid as to Julian's share. Their conclusion was based on the absence of the authority from
his co-heirs in favor of Julian to convey their shares in the subject lot. We have no reason to overturn the
affirmance of the CA on the issue of the respondents' co-ownership with Julian. Hence, the conveyance by
Julian of the entire property pursuant to the Deed did not bind the respondents for lack of their consent and
authority in his favor. As such, the Deed had no legal effect as to their shares in the property. Article 1317 of
the Civil Code provides that no person could contract in the name of another without being authorized by the
latter, or unless he had by law a right to represent him; the contract entered into in the name of another by one
who has no authority or legal representation, or who has acted beyond his powers, is unenforceable, unless it is
ratified, expressly or impliedly, by the person on whose behalf it has been executed, before it is revoked by the
other contracting party. But the conveyance by Julian through the Deed had full force and effect with respect to
his share of 1/22 of the entire property consisting of 546 square meters by virtue of its being a voluntary
disposition of property on his part.
MCIAA's assertion of estoppel or ratification to bar the respondents' contrary claim of ownership of their shares
in the subject lot is bereft of substance. The doctrine of estoppel applied only to those who were parties to the
contract and their privies or successors-in-interest. Moreover, the respondents could not be held to ratify the
contract that was declared to be null and void with respect to their share, for there was nothing for them to
ratify. Verily, the Deed, being null and void, had no adverse effect on the rights of the respondents in the
subject lot.
Sps. Roberto and Adelaida Pen vs. Sps. Santos and Linda Julian
G.R. No. No. 160408, January 11, 2016
BERSAMIN, J.:
Article 2088 of the Civil Code prohibits the creditor from appropriating the things given by way of pledge or
mortgage, or from disposing of them; any stipulation to the contrary is null and void. The elements for pactum
commissorium to exist are as follows, to wit: (a) that there should be a pledge or mortgage wherein property is
pledged or mortgaged by way of security for the payment of the principal obligation; and (b) that there should
be a stipulation for an automatic appropriation by the creditor of the thing pledged or mortgaged in the event
of non-payment of the principal obligation within the stipulated period.
FACTS:
The Julians obtained a P60,000.00 loan from Adelaida Pen. On May 23, 1986 and on May 27, 1986, they were
again extended loans in the amounts of P50,000.00 and P10,000.00, respectively by Adelaida. The initial
interests were deducted by appellant Adelaida, (1) P3,600.00 from the P60,000.00 loan; (2) P2,400.00 from the
P50,000.00 loan; and (3) P600.00 from the P10,000.00 loan. Two (2) promissory notes were executed by the
appellees in favor of Adelaida to evidence the foregoing loans, one dated April 9, 1986 and payable on June 15,
1986 for the P60,000.00 loan and another dated May 22, 1986 payable on July 22, 1986 for the P50,000.00
loan. Both loans were charged interest at 6% per month. As security, on May 23, 1986, the appellees executed a
Real Estate Mortgage over their property covered by TCT No. 327733 registered under the name of appellee
Santos Julian, Jr. The owner's duplicate of TCT No. 327733 was delivered to the appellants. When the loans
became due and demandable, appellees failed to pay despite several demands. As such, appellant Adelaida
decided to institute foreclosure proceedings. However, she was prevailed upon by appellee Linda not to
foreclose the property because of the cost of litigation and since it would cause her embarrassment as the
proceedings will be announced in public places at the City Hall, where she has many friends. Instead, appellee
Linda offered their mortgaged property as payment in kind.

ISSUE: whether or not the CA erred in ruling against the validity of the deed of sale; and (2) whether or not the
CA erred in ruling that no monetary interest was due for Linda's use of Adelaida's money.

RULING:
Article 2088 of the Civil Code prohibits the creditor from appropriating the things given by way of pledge or
mortgage, or from disposing of them; any stipulation to the contrary is null and void. The elements for pactum
commissorium to exist are as follows, to wit: (a) that there should be a pledge or mortgage wherein property is
pledged or mortgaged by way of security for the payment of the principal obligation; and ( b) that there should
be a stipulation for an automatic appropriation by the creditor of the thing pledged or mortgaged in the event of
non-payment of the principal obligation within the stipulated period. The first element was present considering
that the property of the respondents was mortgaged by Linda in favor of Adelaida as security for the farmer's
indebtedness. As to the second, the authorization for Adelaida to appropriate the property subject of the
mortgage upon Linda's default was implied from Linda's having signed the blank deed of sale simultaneously
with her signing of the real estate mortgage. The haste with which the transfer of property was made upon the
default by Linda on her obligation, and the eventual transfer of the property in a manner not in the form of a
valid dacion en pago ultimately confirmed the nature of the transaction as a pactum commissorium.
It is notable that in reaching its conclusion that Linda's deed of sale had been executed simultaneously with the
real estate mortgage, the CA first compared the unfilled deed of sale presented by Linda with the notarized
deed of sale adduced by Adelaida. The CA justly deduced that the completion and execution of the deed of sale
had been conditioned on the non-payment of the debt by Linda, and reasonably pronounced that such
circumstances rendered the transaction pactum commissorium. The Court should not disturb or undo the CA's
conclusion in the absence of the clear showing of abuse, arbitrariness or capriciousness on the part of the CA.
Dacion en pago is in the nature of a sale because property is alienated in favor of the creditor in satisfaction of a
debt in money. For a valid dacion en pago to transpire, however, the attendance of the following elements must
be established, namely: (a) the existence of a money obligation; (b) the alienation to the creditor of a property
by the debtor with the consent of the former; and (c) the satisfaction of the money obligation of the debtor. To
have a valid dacion en pago, therefore, the alienation of the property must fully extinguish the debt. Yet, the
debt of the respondents subsisted despite the transfer of the property in favor of Adelaida.
In a sale, the contract is perfected at the moment when the seller obligates herself to deliver and to transfer
ownership of a thing or right to the buyer for a price certain, as to which the latter agrees. The absence of the
consideration from Linda's copy of the deed of sale was credible proof of the lack of an essential requisite for
the sale. In other words, the meeting of the minds of the parties so vital in the perfection of the contract of sale
did not transpire. And, even assuming that Linda's leaving the consideration blank implied the authority of
Adelaida to fill in that essential detail in the deed of sale upon Linda's default on the loan, the conclusion of the
CA that the deed of sale was a pactum commisorium still holds, for, as earlier mentioned, all the elements of
pactum commisorium were present.
The CA correctly deleted the monetary interest from the judgment. Pursuant to Article 1956 of the Civil Code,
no interest shall be due unless it has been expressly stipulated in writing. In order for monetary interest to be
imposed, therefore, two requirements must be present, specifically: (a) that there has been an express
stipulation for the payment of interest; and ( b) that the agreement for the payment of interest has been reduced
in writing. Considering that the promissory notes contained no stipulation on the payment of monetary interest,
monetary interest cannot be validly imposed.
The CA properly imposed compensatory interest to offset the delay in the respondents' performance of their
obligation. Nonetheless, the imposition of the legal rate of interest should be modified to conform to the
prevailing jurisprudence. The rate of 12% per annum imposed by the CA was the rate set in accordance with
Eastern Shipping Lines, Inc., v. Court of Appeals. In the meanwhile, Bangko Sentral ng Pilipinas Monetary
Board Resolution No. 796 dated May 16, 2013, amending Section 2 of Circular No. 905, Series of 1982, and
Circular No. 799, Series of 2013, has lowered to 6% per annum the legal rate of interest for a loan or
forbearance of money, goods or credit starting July 1, 2013. This revision is expressly recognized in Nacar v.
Gallery Frames. It should be noted, however, that imposition of the legal rate of interest at 6% per annum is
prospective in application.

Agency
Marcos Prieto vs. Court of Appeals
G.R. No. 158597, June 18, 2012
BERSAMIN, J.:
Ratification or confirmation may validate an act done in behalf of another without authority from the latter.
The effect is as if the latter did the act himself.
FACTS:
Spouses Marcos V. Prieto and Susan M. Prieto filed in the Regional Trial Court in Bauang, La Union a
complaint against Far East Bank and Trust Company (FEBTC) and the Spouses Antonio Prieto and Monette
Prieto to declare the nullity of several real estate mortgage contracts. The plaintiffs narrated that they had
executed a special power of attorney (SPA) to authorize Antonio to borrow money from FEBTC, using as
collateral their real property consisting of a parcel of land located in Calumbaya, Bauang, La Union; that
defendant spouses, using the property as collateral, had thereafter obtained from FEBTC a series of loans
totaling P5,000,000.00, evidenced by promissory notes, and secured by separate real estate mortgage
contracts; that defendant spouses had failed to pay the loans, leading FEBTC to initiate the extra-judicial
foreclosure of the mortgages; and that the promissory notes and the real estate mortgage contracts were in the
name of defendant spouses for themselves alone, who had incurred the obligations, rendering the promissory
notes and the mortgage contracts null and void ab initio. RTC rendered its decision dismissing the complaint,
ruling that the mortgage contracts, even if entered into in the name of the agent, should be deemed made in his
behalf as the principal because the things involved belonged to the principal

ISSUE: (1) Whether or not the decision of CA was void (2) Whether or not CA erred in rejecting his petition
for certiorari because his notice of appeal in the RTC had been tardy by only two days (3) Whether or not there
was failure on the part or FEBTC to duly investigate the authority of Antonio in contracting the exceptionally
and relatively immense loan

RULING: (1) No (2) No (3) No

First of all, Marcos submits that the CAs assailed resolution was signed only by Associate Justices
Vasquez and Reyes, Jr.; that Associate Justice Guaria III as the third Member did not sign the resolution; that
the absence of Associate Justice Guaria IIIs signature revealed the lack of unanimity in the voting, rendering
the resolution null and void pursuant to Section 4 of the 1999 Internal Rules of the Court of Appeals. Associate
Justice Guaria III expressly concurred in the resolution in question, as borne out by the copy itself of the
assailed resolution attached to the petition for review as Enclosure A.
The general rule is that a timely appeal is the remedy to obtain reversal or modification of the judgment
on the merits. In other words, the perfection of an appeal within the reglementary period is mandatory because
the failure to perfect the appeal within the time prescribed by the Rules of Court unavoidably renders the
judgment final as to preclude the appellate court from acquiring the jurisdiction to review the judgment. We
stress, too, that the statutory nature of the right to appeal requires the appealing party to strictly comply with the
statutes or rules governing the perfection of the appeal because such statutes or rules are considered
indispensable interdictions against needless delays and are instituted in favor of an orderly discharge of judicial
business. In the absence of highly exceptional circumstances warranting their relaxation, therefore, the statutes
or rules should remain inviolable.
[26]
Marcos could not deny that under the express terms of the SPA, he had precisely granted to Antonio
as his agent the authority to borrow money, and to transfer and convey the property by way of mortgage to
FEBTC; to sign, execute and deliver promissory notes; and to receive the proceeds of the loans on the formers
behalf. In other words, the mortgage contracts were valid and enforceable against petitioner, who was
consequently fully bound by their terms. Even if it was assumed that Antonios obtaining the loans in his own
name, and executing the mortgage contracts also in his own name had exceeded his express authority under the
SPA, Marcos was still liable to FEBTC by virtue of his express ratification of Antonios act. Under Article
1898 of the Civil Code, the acts of an agent done beyond the scope of his authority do not bind the principal
unless the latter expressly or impliedly ratifies the same.
In agency, ratification is the adoption or confirmation by one person of an act performed on his behalf
by another without authority. The substance of ratification is the confirmation after the act, amounting to a
substitute for a prior authority. Here, there was such a ratification by Marcos, as borne out by his execution of
the letter of acknowledgement. Being himself a lawyer, Marcos was aware of the import and consequences of
the letter of acknowledgment.

Credit Transactions
Spouses Francisco and Merced Rabat vs. Philippine National Bank
G.R. No. 158755, June 18, 2012
BERSAMIN, J.:
The inadequacy of the bid price in an extrajudicial foreclosure sale of mortgaged properties will not per
se invalidate the sale. Additionally, the foreclosing mortgagee is not precluded from recovering the deficiency
should the proceeds of the sale be insufficient to cover the entire debt.
FACTS:
Respondent spouses Francisco and Merced Rabat applied for a loan with PNB. Subsequently, the
RABATs were granted a medium-term loan of P4.0 Million to mature three years from the date of
implementation. RABATs signed a Credit Agreement and executed a Real Estate Mortgage over twelve (12)
parcels of land which stipulated that the loan would be subject to interest at the rate of 17% per annum, plus the
appropriate service charge and penalty charge of 3% per annum on any amount remaining unpaid or not
renewed when due. RABATs executed another document denominated as "Amendment to the Credit
Agreement" purposely to increase the interest rate from 17% to 21% per annum, inclusive of service charge and
a penalty charge of 3% per annum to be imposed on any amount remaining unpaid or not renewed when due.
They also executed another Real Estate Mortgage over nine (9) parcels of land as additional security for their
medium-term loan of Four Million (P4.0 M). These parcels of land are agricultural, commercial and residential
lots situated in Mati, Davao Oriental. The several availments of the loan accommodation on various dates by
the RABATs reached the aggregate amount of P3,517,380, as evidenced by the several promissory notes, all of
which were due on 14 March 1983. The RABATs failed to pay their outstanding balance on due date. PNB
filed a petition for the extrajudicial foreclosure of the real estate mortgage executed by the RABATs. After due
notice and publication, the mortgaged parcels of land were sold at a public auction WITH PNB as the lone and
highest bidder. As the proceeds of the public auction were not enough to satisfy the entire obligation of the
RABATs, the PNB sent anew demand letters. Upon failure of the RABATs to comply with the demand to settle
their remaining outstanding obligation which then stood at P14,745,398.25, including interest, penalties and
other charges, PNB eventually filed a complaint for a sum of money before the Regional Trial Court of
Manila.

ISSUE: (1) Whether or not the inadequacy of the bid price at the forced sale nullifies the sale (2) Whether or
not PNB was entitled to recover any deficiency due to the invalidity of the forced sales

RULING: (1) No (2) Yes

The inadequacy of the bid price at a forced sale, unlike that in an ordinary sale, is immaterial and does
not nullify the sale; in fact, in a forced sale, a low price is considered more beneficial to the mortgage debtor
because it makes redemption of the property easier. At any rate, we consider it notable enough that PNBs bid
price of 3,874,800.00 might not even be said to be outrageously low as to be shocking to the conscience. As
the CA cogently noted in the second amended decision, that bid price was almost equal to both
the 4,000,000.00 applied for by the Spouses Rabat as loan, and to the total sum of 3,517,380.00 of their
actual availment from PNB.

It is settled that if the proceeds of the sale are insufficient to cover the debt in an extrajudicial
foreclosure of the mortgage, the mortgagee is entitled to claim the deficiency from the debtor. There should be
no question that PNB was legally entitled to recover the penalty charge of 3% per annum and attorneys fees
equivalent to 10% of the total amount due. The documents relating to the loan and the real estate mortgage
showed that the Spouses Rabat had expressly conformed to such additional liabilities; hence, they could not
now insist otherwise. Equally axiomatic are that a contract is the law between the contracting parties, and that
they have the autonomy to include therein such stipulations, clauses, terms and conditions as they may want to
include. Inasmuch as the Spouses Rabat did not challenge the legitimacy and efficacy of the additional
liabilities being charged by PNB, they could not now bar PNB from recovering the deficiency representing the
additional pecuniary liabilities that the proceeds of the forced sales did not cover.

International Hotel Corporation vs. Francisco Joaquin, Jr. and Rafael Suarez
G.R. No. 158361, April 10, 2013
BERSAMIN, J.:
To avoid unjust enrichment to a party from resulting out of a substantially performed contract, the principle of
quantum meruit may be used to determine his compensation in the absence of a written agreement for that
purpose. The principle of quantum meruit justifies the payment of the reasonable value of the services rendered
by him.
FACTS:
Respondent Francisco B. Joaquin, Jr. submitted a proposal to the Board of Directors of the International Hotel
Corporation (IHC) for him to render technical assistance in securing a foreign loan for the construction of a
hotel, to be guaranteed by the Development Bank of the Philippines (DBP). The proposal encompassed nine
phases, namely: (1) the preparation of a new project study; (2) the settlement of the unregistered mortgage prior
to the submission of the application for guaranty for processing by DBP; (3) the preparation of papers
necessary to the application for guaranty; (4) the securing of a foreign financier for the project; (5) the securing
of the approval of the DBP Board of Governors; (6) the actual follow up of the application with DBP3; (7) the
overall coordination in implementing the projections of the project study; (8) the preparation of the staff for
actual hotel operations; and (9) the actual hotel operations. The IHC Board of Directors approved phase one to
phase six of the proposal during the special board meeting on February 11, 1969, and earmarked P2,000,000.00
for the project. Anent the financing, IHC applied with DBP for a foreign loan guaranty. DBP processed the
application, and approved it on October 24, 1969 subject to several conditions. On July 11, 1969, shortly after
submitting the application to DBP, Joaquin wrote to IHC to request the payment of his fees in the amount of
P500,000.00 for the services that he had provided and would be providing to IHC in relation to the hotel project
that were outside the scope of the technical proposal. Joaquin intimated his amenability to receive shares of
stock instead of cash in view of IHCs financial situation. Joaquin presented to the IHC Board of Directors the
results of his negotiations with potential foreign financiers. He narrowed the financiers to Roger Dunn &
Company and Materials Handling Corporation. He recommended that the Board of Directors consider
Materials Handling Corporation based on the more beneficial terms it had offered. His recommendation was
accepted. Negotiations with Materials Handling Corporation and, later on, with its principal, Barnes
International (Barnes), ensued. While the negotiations with Barnes were ongoing, Joaquin and Jose Valero, the
Executive Director of IHC, met with another financier, the Weston International Corporation (Weston), to
explore possible financing. When Barnes failed to deliver the needed loan, IHC informed DBP that it would
submit Weston for DBPs consideration. As a result, DBP cancelled its previous guaranty through a letter dated
December 6, 1971. IHC entered into an agreement with Weston, and communicated this development to DBP
on June 26, 1972. However, DBP denied the application for guaranty for failure to comply with the conditions
contained in its November 12, 1971 letter. Due to Joaquins failure to secure the needed loan, IHC, through its
President Bautista, cancelled the 17,000 shares of stock previously issued to Joaquin and Suarez as payment for
their services. The latter requested a reconsideration of the cancellation, but their request was rejected. Joaquin
and Suarez commenced this action for specific performance, annulment, damages and injunction by a
complaint dated December 6, 1973 in the Regional Trial Court in Manila

ISSUE: Whether or not the petitioner is obliged to pay the respondent

RULING: Yes
Article 1186 and Article 1234 of the Civil Code cannot be the source of IHCs obligation to pay
respondents
Article 1186 refers to the constructive fulfillment of a suspensive condition, whose application calls for two
requisites, namely: (a) the intent of the obligor to prevent the fulfillment of the condition, and (b) the actual
prevention of the fulfillment. Mere intention of the debtor to prevent the happening of the condition, or to place
ineffective obstacles to its compliance, without actually preventing the fulfillment, is insufficient. IHC had no
intention, willful or otherwise, to prevent Joaquin and Suarez from meeting their undertaking. Such absence of
any intention negated the basis for the CAs reliance on Article 1186 of the Civil Code.
It is well to note that Article 1234 applies only when an obligor admits breaching the contract after honestly
and faithfully performing all the material elements thereof except for some technical aspects that cause no
serious harm to the obligee. IHC correctly submits that the provision refers to an omission or deviation that is
slight, or technical and unimportant, and does not affect the real purpose of the contract. The principle of
substantial performance is inappropriate when the incomplete performance constitutes a material breach of the
contract. A contractual breach is material if it will adversely affect the nature of the obligation that the obligor
promised to deliver, the benefits that the obligee expects to receive after full compliance, and the extent that the
non-performance defeated the purposes of the contract. Accordingly, for the principle embodied in Article 1234
to apply, the failure of Joaquin and Suarez to comply with their commitment should not defeat the ultimate
purpose of the contract.

IHC is nonetheless liable to pay under the rule on constructive fulfillment of a mixed conditional
obligation
To secure a DBP-guaranteed foreign loan did not solely depend on the diligence or the sole will of the
respondents because it required the action and discretion of third persons an able and willing foreign financial
institution to provide the needed funds, and the DBP Board of Governors to guarantee the loan. Such third
persons could not be legally compelled to act in a manner favorable to IHC. There is no question that when the
fulfillment of a condition is dependent partly on the will of one of the contracting parties, or of the obligor, and
partly on chance, hazard or the will of a third person, the obligation is mixed. Considering that the respondents
were able to secure an agreement with Weston, and subsequently tried to reverse the prior cancellation of the
guaranty by DBP, we rule that they thereby constructively fulfilled their obligation.

Quantum meruit should apply in the absence of an express agreement on the fees
Anent the P2,000,000.00, the CA rightly concluded that the full amount of P2,000,000.00 could not be awarded
to respondents because such amount was not allocated exclusively to compensate respondents, but was
intended to be the estimated maximum to fund the expenses in undertaking phase 6 of the scope of services. It
is notable that the confusion on the amounts of compensation arose from the parties inability to agree on the
fees that respondents should receive. Considering the absence of an agreement, and in view of respondents
constructive fulfillment of their obligation, the Court has to apply the principle of quantum meruit in
determining how much was still due and owing to respondents. Under the principle of quantum meruit, a
contractor is allowed to recover the reasonable value of the services rendered despite the lack of a written
contract. The measure of recovery under the principle should relate to the reasonable value of the services
performed. The principle prevents undue enrichment based on the equitable postulate that it is unjust for a
person to retain any benefit without paying for it. Being predicated on equity, the principle should only be
applied if no express contract was entered into, and no specific statutory provision was applicable.

United Coconut Planters Bank vs. Christopher Lumbo and Milagros Lumbo
G.R. No.162757, December 11, 2013
BERSAMIN, J.:
The implementation of a writ of possession issued pursuant to Act No. 3135 at the instance of the purchaser at
the foreclosure sale of the mortgaged property in whose name the title has been meanwhile consolidated
cannot be prevented by the injunctive writ.
FACTS:
The respondents borrowed the aggregate amount of P12,000,000.00 from UCPB. To secure the performance of
their obligation, they constituted a real estate mortgage on a parcel of land located in Boracay, Aklan and all the
improvements thereon that they owned and operated as a beach resort known as Titays South Beach Resort.
Upon their failure to settle the obligation, UCPB applied on November 11, 1998 for the extrajudicial
foreclosure of the mortgage, and emerged as the highest bidder at the ensuing foreclosure sale held on January
12, 1999. The certificate of sale was issued on the same day, and UCPB registered the sale in its name on
February 18, 1999. The title over the mortgaged property was consolidated in the name of UCPB after the
respondents failed to redeem the property within the redemption period. On January 7, 2000, the respondents
brought against UCPB in the RTC an action for the annulment of the foreclosure, legal accounting, injunction
against the consolidation of title, and damages (Civil Case No. 5920). During the pendency of Civil Case No.
5920, UCPB filed an ex parte petition for the issuance of a writ of possession to recover possession of the
property (Special Proceedings No. 5884). On September 5, 2000, the RTC granted the ex parte petition of
UCPB, and issued on December 4, 2001 the writ of possession directing the sheriff of the Province of Aklan to
place UCPB in the actual possession of the property. The writ of possession was served on the respondents on
January 23, 2002 with a demand for them to peacefully vacate on or before January 31, 2002. Although the
possession of the property was turned over to UCPB on February 1, 2002, they were allowed to temporarily
remain on the property for humanitarian reasons. On February 14, 2002, the respondents filed in the RTC
handling Special Proceedings No. 5884 a petition to cancel the writ of possession and to set aside the
foreclosure sale. They included an application for a writ of preliminary injunction and temporary restraining
order to prevent the implementation of the writ of possession. RTC denied the respondents application for the
issuance of a writ of preliminary injunction

ISSUE: Whether the CA correctly granted the injunctive writ to enjoin the implementation of the writ of
possession the RTC had issued to place UCPB in the possession of the mortgaged property

RULING:
A writ of possession commands the sheriff to place a person in possession of real property. It may be issued in
the following instances, namely: (1) land registration proceedings under Section 17 of Act No. 496; (2) judicial
foreclosure, provided the debtor is in possession of the mortgaged property, and no third person, not a party to
the foreclosure suit, had intervened; (3) extrajudicial foreclosure of a real estate mortgage, pending redemption
under Section 7 of Act No. 3135, as amended by Act No. 4118; and (4) execution sales, pursuant to the last
paragraph of Section 33, Rule 39 of the Rules of Court. With particular reference to an extra-judicial
foreclosure of a real estate mortgage under Act No. 3135, as amended by Act No. 4118, the purchaser at the
foreclosure sale may apply ex parte with the RTC of the province or place where the property or any part of it
is situated, to give the purchaser possession thereof during the redemption period, furnishing bond in an
amount equivalent to the use of the property for a period of twelve months, to indemnify the debtor should it be
shown that the sale was made without violating the mortgage or without complying with the requirements of
Act No. 3135; and the RTC, upon approval of the bond, order that a writ of possession be issued, addressed to
the sheriff of the province in which the property is situated, who shall then execute said order immediately. We
underscore that the application for a writ of possession by the purchaser in a foreclosure sale conducted under
Act No. 3135 is ex parte and summary in nature, brought for the benefit of one party only and without notice
being sent by the court to any person adverse in interest. The relief is granted even without giving an
opportunity to be heard to the person against whom the relief is sought. Its nature as an ex parte petition under
Act No. 3135, as amended, renders the application for the issuance of a writ of possession a non-litigious
proceeding. Indeed, the grant of the writ of possession is but a ministerial act on the part of the issuing court,
because its issuance is a matter of right on the part of the purchaser. The judge issuing the order for the granting
of the writ of possession pursuant to the express provisions of Act No. 3135 cannot be charged with having
acted without jurisdiction or with grave abuse of discretion.
The reckoning of the period of redemption by the mortgagor or his successor-in-interest starts from the
registration of the sale in the Register of Deeds. Although Section 620 of Act No. 3135, as amended, specifies
that the period of redemption starts from and after the date of the sale, jurisprudence has since settled that such
period is more appropriately reckoned from the date of registration. The property was sold at the public auction
on January 12, 1999, with UCPB as the highest bidder. The sheriff issued the certificate of sale to UCPB on the
same day of the sale. Considering that UCPB registered the certificate of sale in its name on February 18, 1999,
the period of redemption was one year from said date. By virtue of the non-redemption by the respondents
within said period, UCPB consolidated the title over the property in its name. It is clear enough, therefore, that
the RTC committed no grave abuse of discretion but acted in accordance with the law and jurisprudence
in denying the respondents application for the injunctive writ

Philippine National Bank vs. Sps. Enrique Manalo and Rosalinda Jacinto et al
G.R. No. 174433, February 24, 2014
BERSAMIN, J.:
Although banks are free to determine the rate of interest they could impose on their borrowers, they can do
so only reasonably, not arbitrarily. They may not take advantage of the ordinary borrowers lack of familiarity
with banking procedures and jargon. Hence, any stipulation on interest unilaterally imposed and increased by
them shall be struck down as violative of the principle of mutuality of contracts.
FACTS:
Respondent Spouses Manalo applied for an All-Purpose Credit Facility with Philippine National Bank
to finance the construction of their house wherein they executed a Real Estate Mortgage over their property. It
was agreed upon that the Spouses Manalo would make monthly payments on the interest. However, PNB
claimed that their last recorded payment was made on December, 1997. Thus, PNB sent a demand letter to
them on their overdue account and required them to settle the account. After the Spouses Manalo still failed to
settle their unpaid account despite the two demand letters, PNB foreclose the mortgage, PNB being the highest
bidder.
The Spouses Manalo instituted this action for the nullification of the foreclosure proceedings and
damages. After trial, the RTC rendered its decision in favor of PNB. On appeal, the CA affirmed the decision
of the RTC insofar as it upheld the validity of the foreclosure proceedings initiated by PNB, but modified the
Spouses Manalos liability for interest.

ISSUES:
Whether or not the CA was correct in nullifying the interest rates and in fixing the same at 12 % despite that
fact that the same was raised by respondents only for the first time on appeal.
Whether or not there was a mutuality of consent in the imposition of interest rates on the respondent spouses
loan.

RULING:
Procedural Issue
Contrary to PNBs argument, the validity of the interest rates and of the increases, and on the lack of mutuality
between the parties were impliedly raised during the trial itself, and PNBs lack of vigilance in voicing out a
timely objection made that possible. It appears that Enrique Manalos Judicial Affidavit introduced the issues
of the validity of the interest rates and the increases, and the lack of mutuality between the parties. There is no
showing that PNB raised any objection in the course of the cross examination. Consequently, the RTC rightly
passed upon such issues in deciding the case, and its having done so was in total accord with Section 5, Rule 10
of the Rules of Court.
The RTC did not need to direct the amendment of the complaint by the Spouses Manalo. Section 5,
Rule 10 of the Rules of Court specifically declares that the failure to amend does not affect the result of the
trial of these issues. The failure of a party to amend a pleading to conform to the evidence adduced during trial
does not preclude an adjudication by the court on the basis of such evidence which may embody new issues not
raised in the pleadings, or serve as a basis for a higher award of damages. Former Chief Justice Moran put the
matter in this way:
When evidence is presented by one party, with the expressed or implied consent of the adverse party,
as to issues not alleged in the pleadings, judgment may be rendered validly as regards those issues, which shall
be considered as if they have been raised in the pleadings. There is implied, consent to the evidence thus
presented when the adverse party fails to object thereto. There is also no merit in PNBs contention that the
CA should not have considered and ruled on the issue of the validity of the interest rates. We do not agree.
Section 5, Rule 10 of the Rules of Court applies when evidence is introduced on an issue not alleged in the
pleadings and no objection is interposed by the adverse party. In this case, Enrique Manalos Judicial Affidavit
would introduce the very issues that PNB is now assailing. The question of whether the evidence on such issues
was admissible to prove the nullity of the interest rates is an entirely different matter. The RTC accorded
credence to PNBs evidence showing that the Spouses Manalo had been paying the interest imposed upon them
without protest. On the other hand, the CAs nullification of the interest rates was based on the credit
agreements that the Spouses Manalo and PNB had themselves submitted.
Based on the foregoing, the validity of the interest rates and their increases, and the lack of mutuality
between the parties were issues validly raised in the RTC, giving the Spouses Manalo every right to raise them
in their appeal to the CA.

Substantive Issue
Although banks are free to determine the rate of interest they could impose on their borrowers, they can
do so only reasonably, not arbitrarily. They may not take advantage of the ordinary borrowers lack of
familiarity with banking procedures and jargon. Hence, any stipulation on interest unilaterally imposed and
increased by them shall be struck down as violative of the principle of mutuality of contracts.
PNB arrogated unto itself the sole prerogative to determine and increase the interest rates imposed on the
Spouses Manalo. Such a unilateral determination of the interest rates contravened the principle of mutuality of
contracts embodied in Article 1308 of the Civil Code. The Court has declared that a contract where there is no
mutuality between the parties partakes of the nature of a contract of adhesion, and any obscurity will be
construed against the party who prepared the contract, the latter being presumed the stronger party to the
agreement, and who caused the obscurity. PNB should then suffer the consequences of its failure to specifically
indicate the rates of interest in the credit agreement.
PNB could not also justify the increases it had effected on the interest rates by citing the fact that the
Spouses Manalo had paid the interests without protest, and had renewed the loan several times. We rule that the
CA, citing Philippine National Bank v. Court of Appeals, rightly concluded that a borrower is not estopped
from assailing the unilateral increase in the interest made by the lender since no one who receives a proposal to
change a contract, to which he is a party, is obliged to answer the same and said partys silence cannot be
construed as an acceptance thereof.
Lastly, the CA observed, and properly so, that the credit agreements had explicitly provided that prior
notice would be necessary before PNB could increase the interest rates. In failing to notify the Spouses Manalo
before imposing the increased rates of interest, therefore, PNB violated the stipulations of the very contract that
it had prepared. Hence, the varying interest rates imposed by PNB have to be vacated and declared null and
void, and in their place an interest rate of 12% per annum computed from their default is fixed pursuant to the
ruling in Eastern Shipping Lines, Inc. v. Court of Appeals.

Development Bank of the Philippines vs. Guarina Agricultural and Realty Development Corp.
G.R. No. 160758, January 15, 2014
BERSAMIN, J.:
The foreclosure of a mortgage prior to the mortgagors default on the principal obligation is premature, and
should be undone for being void and ineffectual. The mortgagee who has been meanwhile given possession of
the mortgaged property by virtue of a writ of possession issued to it as the purchaser at the foreclosure sale
may be required to restore the possession of the property to the mortgagor and to pay reasonable rent for the
use of the property during the intervening period.
FACTS:
Guaria Corporation applied for a loan from DBP. Guaria Corporation executed a promissory note
that would be due on November 3, 1988. Guaria Corporation executed a real estate mortgage over several real
properties in favor of DBP loan and a chattel mortgage over the personal properties existing at the resort
complex and those yet to be acquired.
The loan was released in several installments. Guaria Corporation demanded the release of the
balance of the loan, but DBP refused. DBP thus demanded that Guaria Corporation expedite the completion of
the project, and warned that it would initiate foreclosure proceedings should Guaria Corporation not do so.
Unsatisfied with the non-action and objection of Guaria Corporation, DBP initiated extrajudicial foreclosure
proceedings. Guaria Corporation sued DBP in the RTC to demand specific performance of the latters
obligations under the loan agreement, and to stop the foreclosure of the mortgages (Civil Case No. 12707).
Guaria Corporation amended the complaint to seek the nullification of the foreclosure proceedings and the
cancellation of the certificate of sale. DBP applied for the issuance of a writ of possession which was granted
by the RTC.

ISSUE:
Whether or not DBPs foreclosure of the mortgaged properties is invalid and uncalled for. Whether or not the
doctrine of the law of the case finds application in this case.

RULING:
The foreclosure of a mortgage prior to the mortgagors default on the principal obligation is premature, and
should be undone for being void and ineffectual. The mortgagee who has been meanwhile given possession
of the mortgaged property by virtue of a writ of possession issued to it as the purchaser at the foreclosure
sale may be required to restore the possession of the property to the mortgagor and to pay reasonable rent
for the use of the property during the intervening period.
Loan is a reciprocal obligation, as it arises from the same cause where one party is the creditor, and the
other the debtor. This means that in a loan, the creditor should release the full loan amount and the debtor
repays it when it becomes due and demandable. Hence, by its failure to release the proceeds of the loan in their
entirety, DBP had no right yet to exact on Guaria Corporation the latters compliance with its own obligation
under the loan. Indeed, if a party in a reciprocal contract like a loan does not perform its obligation, the other
party cannot be obliged to perform what is expected of it while the others obligation remains unfulfilled. In
other words, the latter party does not incur delay.
While a creditor and a debtor could regulate the order in which they should comply with their reciprocal
obligations, it is presupposed that in a loan the lender should perform its obligation - the release of the full loan
amount - before it could demand that the borrower repay the loaned amount. Considering that it had yet to
release the entire proceeds of the loan, DBP could not yet make an effective demand for payment upon Guaria
Corporation to perform its obligation under the loan. Under the circumstances, DBPs foreclosure of the
mortgage and the sale of the mortgaged properties at its instance were premature, and, therefore, void and
ineffectual.

The doctrine of law of the case simply means, that when an appellate court has once declared the law in a
case, its declaration continues to be the law of that case even on a subsequent appeal, notwithstanding that the
rule thus laid down may have been reversed in other cases. But the law of the case, as the name implies,
concerns only legal questions or issues thereby adjudicated in the former appeal. The foregoing understanding
of the concept of the law of the case exposes DBPs insistence to be unwarranted.
To start with, the ex parte proceeding on DBPs application for the issuance of the writ of possession was
entirely independent from the judicial demand for specific performance herein. In fact, C.A.-G.R. No. 12670-
SP, being the interlocutory appeal concerning the issuance of the writ of possession while the main case was
pending, was not at all intertwined with any legal issue properly raised in the appeal to determine whether or
not DBPs foreclosure was valid and effectual. And, secondly, the ruling in C.A.-G.R. No. 12670-SP did not
settle any question of law involved herein because this case for specific performance was not a continuation of
C.A.-G.R. No. 12670-SP (which was limited to the propriety of the issuance of the writ of possession in favor
of DBP), and vice versa.

Rural Bank of Malasiqui Inc. vs. Romeo Ceralde

G.R. No. 162032, November 25, 2015
BERSAMIN, J.:
FACTS:
Romeo M. Ceralde and Eduardo M. Ceralde, Jr., are the owners of the parcels of land covered by Transfer
Certificate of Title (TCT) Nos. 111647 and 111648 respectively, of the Registry of Deeds of Pangasinan.
Under varied dates in the years 1978, 1980, 1981 and 1982, they mortgaged these properties in favor of
appellee rurak bank of Malasiqui, Inc., as security for agricultural loans they obtained from the bank. At the
time, however, the land had already been placed under the coverage of Operation Land Transfer and the
corresponding Certificates of Land Transfer were already issued to the tenants thereon. Nevertheless, appellee
rural bank, through its president, adviced mortgagors-appellants to submit an Affidavit of Non-Tenancy, which
appellants complied with. The mortgages were then approved by appellee rural bank. After the respondents did
not pay the loans at maturity, the petitioner caused the extrajudicial foreclosure of the mortgages. In the ensuing
foreclosure sale, the petitioner acquired the mortgaged properties for being the highest bidder. The respondents
commenced this action in the RTC to recover the net value of the just compensation of the lands subject of the
mortgages, averring that their right to receive the payment for just compensation either directly from the tenants
or from the Land Bank of the Philippines could not be the subject of the foreclosure proceedings; and that their
equitable interest in the right to receive the just compensation was protected under Section 80 of Republic Act
No. 3844 (Agricultural Land Reform Code), as amended, based on Opinion No. 92, Series of 1978, issued by
the Secretary of Justice.

ISSUE: which between the parties -on one hand, the petitioner, the rural bank that foreclosed the mortgage
constituted on the agricultural lands earlier expropriated under the land reform program of the State, and
acquired the lands under mortgage as the highest bidder in the ensuing foreclosure sale; and, on the other, the
respondents, the registered owners and mortgagors of the lands in favor of the petitioner -was entitled to the
payment of the just compensation for the lands.

RULING:
CA itself found that the petitioner had been well aware of the conditions of the landholding, including the
existence of the tenants thereon. CA concluded that the petitioner was also in bad faith, for, based on the
testimony of Romeo, it was the president herself of the petitioner who had told him that the loan application
would be granted if only he could secure a certificate of non-tenancy from the MARO whose office had been
located just in front of the petitioners premises. And, the tenants deposited the harvests in the warehouse
owned by the president of the petitioner, thereby signifying that the petitioner had actual knowledge of the
existence of the tenants on the lands under mortgage. There was no question that the petitioner had not been
misled by any misrepresentation on the status of tenancy on the lands. The submission of the affidavit of non-
tenancy by the respondents had been at the behest of its president who was then acting in its behalf. It is plain,
moreover, that because its business of rural banking involved the duty and the responsibility to investigate the
conditions of the lands being tendered as collaterals, the petitioner should have discovered the presence of the
tenants in due time and quickly enough by its exercise of due diligence.
Section 80 of Republic Act No. 3844 remained in effect after the effectivity of Republic Act No. 6657. The
latter law expressly repealed only the following provisions, namely: Section 35 of Republic Act No. 3834;18
Presidential Decree No. 316;19 the last two paragraphs of Section 12 of Presidential Decree No. 946;20 and
Presidential Decree No. 1038.21 Worthy to note, too, is that the repealed laws did not concern the subject
matter of Section 80 of Republic Act No. 3844; hence, the catch-all repeal or amendment of all other laws,
decrees, executive orders, rules and regulations, issuances or parts thereof inconsistent with Republic Act No.
6657 did not affect Section 80 of Republic Act No. 3844. In view of the foregoing, Section 80 of Republic Act
No. 3844 and Section 71 of Republic Act No. 6657 must be given equal application.
The respondents had acted in bad faith by misrepresenting that the lands were not tenanted; and, secondly, title
was already consolidated in its name when the lands came to be covered by OLT. We hold that the respondents
were entitled to the net value of the lands not only by law but also by equity. As to equity, we need only to
point out that when the parties are both at fault, the mistake of one is negated by the other's, and they are then
returned to their previous status where the law will look at the facts as if neither is at fault. In such event, we
can only apply the law, particularly Section 80 of Republic Act No. 3844, as amended, and such application
favors the respondents, as we have already explained

Torts and Damages

Vector Shipping Corporation and Francisco Soriano vs. American Home Assurance Company and
Sulpicio Lines
G.R. No. 159213, July 3, 2013
BERSAMIN, J.:
Subrogation under Article 2207 of the Civil Code gives rise to a cause of action created by law. For purposes
of the law on the prescription of actions, the period of limitation is ten years.
FACTS:
Vector was the operator of the motor tanker M/T Vector, while Soriano was the registered owner of the M/T
Vector. Caltex entered into a contract of affreightment with Vector for the transport of Caltexs petroleum
cargo through the M/T Vector. Caltex insured the petroleum cargo with respondent for 7,455,421.08 under
Marine Open Policy No. 34-5093-6. In the evening of December 20, 1987, M/T Vector and the M/V Doa Paz,
the latter a vessel owned and operated by Sulpicio Lines, Inc., collided in the open sea near Dumali Point in
Tablas Strait, located between the Provinces of Marinduque and Oriental Mindoro. The collision led to the
sinking of both vessels. The entire petroleum cargo of Caltex on board the M/T Vector perished. Respondent
indemnified Caltex for the loss of the petroleum cargo in the full amount of 7,455,421.08. On March 5,
1992, respondent filed a complaint against Vector, Soriano, and Sulpicio Lines, Inc. to recover the full amount
of 7,455,421.08 it paid to Caltex (Civil Case No. 92-620). RTC issued a resolution dismissing the case. CA
reversed the RTC. Although thereby absolving Sulpicio Lines, Inc. of any liability to respondent, the CA held
Vector and Soriano jointly and severally liable to respondent for the reimbursement of the amount of
7,455,421.08 paid to Caltex.

ISSUE: whether this action of respondent was already barred by prescription for bringing it only on March 5,
1992

RULING: No
We concur with the CAs ruling that respondents action did not yet prescribe. The legal provision governing
this case was not Article 1146 of the Civil Code, but Article 1144 of the Civil Code. We find and hold that that
the present action was not upon a written contract, but upon an obligation created by law. Hence, it came under
Article 1144 (2) of the Civil Code. This is because the subrogation of respondent to the rights of Caltex as the
insured was by virtue of the express provision of law embodied in Article 2207 of the Civil Code. Verily, the
contract of affreightment that Caltex and Vector entered into did not give rise to the legal obligation of Vector
and Soriano to pay the demand for reimbursement by respondent because it concerned only the agreement for
the transport of Caltexs petroleum cargo. As the Court has aptly put it in Pan Malayan Insurance Corporation
v. Court of Appeals, supra, respondents right of subrogation pursuant to Article 2207, supra, was not
dependent upon, nor d[id] it grow out of, any privity of contract or upon written assignment of claim [but]
accrue[d] simply upon payment of the insurance claim by the insurer. Considering that the cause of action
accrued as of the time respondent actually indemnified Caltex in the amount of 7,455,421.08 on July 12,
1988, the action was not yet barred by the time of the filing of its complaint on March 5, 1992, which was well
within the 10-year period prescribed by Article 1144 of the Civil Code.
It is undeniable that respondent preponderantly established its right of subrogation. Its Exhibit C was Marine
Open Policy No. 34-5093-6 that it had issued to Caltex to insure the petroleum cargo against marine peril. Its
Exhibit D was the formal written claim of Caltex for the payment of the insurance coverage of 7,455,421.08
coursed through respondents adjuster. Its Exhibits E to H were marine documents relating to the perished
cargo on board the M/V Vector that were processed for the purpose of verifying the insurance claim of Caltex.
Its Exhibit I was the subrogation receipt dated July 12, 1988 showing that respondent paid Caltex
7,455,421.00 as the full settlement of Caltexs claim under Marine Open Policy No. 34-5093-6. All these
exhibits were unquestionably duly presented, marked, and admitted during the trial. Specifically, Exhibit C was
admitted as an authentic copy of Marine Open Policy No. 34-5093-6, while Exhibits D, E, F, G, H and I,
inclusive, were admitted as parts of the testimony of respondents witness Efren Villanueva, the manager for
the adjustment service of the Manila Adjusters and Surveyors Company. The payment made to Caltex as the
insured being thereby duly documented, respondent became subrogated as a matter of course pursuant to
Article 2207 of the Civil Code. In legal contemplation, subrogation is the substitution of another person in the
place of the creditor, to whose rights he succeeds in relation to the debt; and is independent of any mere
contractual relations between the parties to be affected by it, and is broad enough to cover every instance in
which one party is required to pay a debt for which another is primarily answerable, and which in equity and
conscience ought to be discharged by the latter.

Philtranco Service Enterprises Inc. vs. Felix Paras and Inland Trailways, Inc. and Court of Appeals
G.R. No. 161909, April 25, 2012
BERSAMIN, J.:
In an action for breach of contract of carriage commenced by a passenger against his common carrier, the
plaintiff can recover damages from a third-party defendant brought into the suit by the common carrier upon a
claim based on tort or quasi-delict. The liability of the third-party defendant is independent from the liability of
the common carrier to the passenger.
FACTS:
Paras is engaged in the buy and sell of fish products. Sometime on 08 February 1987, on his way home
to Manila from Bicol Region, he boarded a bus with Body No. 101 and Plate No. EVE 508, owned and
operated by Inland Trailways, Inc and driven by its driver Calvin Coner. At approximately 3:50 oclock in the
morning of 09 February 1987, while the said bus was travelling along Maharlika Highway, Tiaong, Quezon, it
was bumped at the rear by another bus with Plate No. EVB 259, owned and operated by Philtranco Service
Enterprises, Inc. As a result of the strong and violent impact, the Inland bus was pushed forward and smashed
into a cargo truck parked along the outer right portion of the highway and the shoulder thereof. Consequently,
the said accident bought considerable damage to the vehicles involved and caused physical injuries to the
passengers and crew of the two buses, including the death of Coner who was the driver of the Inland Bus at the
time of the incident. Paras was not spared from the pernicious effects of the accident. He was found and
diagnosed by Dr. Antonio Tanchuling, Jr. to be affected with contusion/hematoma, dislocation of hip upon
fracture of the fibula on the right leg, fractured small bone on the right leg and close fracture on the tibial
plateau of the left leg. Paras filed a complaint for damages based on breach of contract of carriage against
Inland. Inland filed third party complaint against Philtranco.

ISSUE: Whether or not Paras can recover damages

RULING:
Paras can recover moral damages in this suit based on quasi-delict
As a general rule, indeed, moral damages are not recoverable in an action predicated on a breach of
contract. This is because such action is not included in Article 2219 of the Civil Code as one of the actions in
which moral damages may be recovered. By way of exception, moral damages are recoverable in an action
predicated on a breach of contract: (a) where the mishap results in the death of a passenger, as provided in
Article 1764, in relation to Article 2206, (3), of the Civil Code; and (b) where the common carrier has been
guilty of fraud or bad faith, as provided in Article 2220 of the Civil Code.
Although this action does not fall under either of the exceptions, the award of moral damages to Paras
was nonetheless proper and valid. There is no question that Inland filed its third-party complaint against
Philtranco and its driver in order to establish in this action that they, instead of Inland, should be directly liable
to Paras for the physical injuries he had sustained because of their negligence. To be precise, Philtranco and its
driver were brought into the action on the theory of liability that the proximate cause of the collision between
Inlands bus and Philtrancos bus had been the negligent, reckless and imprudent manner defendant Apolinar
Miralles drove and operated his driven unit, the Philtranco Bus with Plate No. 259, owned and operated by
third-party defendant Philtranco Service Enterprises, Inc. The apparent objective of Inland was not to merely
subrogate the third-party defendants for itself, as Philtranco appears to suggest, but, rather, to obtain a different
relief whereby the third-party defendants would be held directly, fully and solely liable to Paras and Inland for
whatever damages each had suffered from the negligence committed by Philtranco and its driver. In other
words, Philtranco and its driver were charged here as joint tortfeasors who would be jointly and severally be
liable to Paras and Inland. Here, the substantive law on which the right of Inland to seek such other relief
through its third-party complaint rested were Article 2176 and Article 2180 of the Civil Code.
Paras cause of action against Inland (breach of contract of carriage) did not need to be the same as the
cause of action of Inland against Philtranco and its driver (tort or quasi-delict) in the impleader. It is settled
that a defendant in a contract action may join as third-party defendants those who may be liable to him in tort
for the plaintiffs claim against him, or even directly to the plaintiff. Nor was it a pre-requisite for attachment of
the liability to Philtranco and its driver that Inland be first declared and found liable to Paras for the breach of
its contract of carriage with him.

Award of temperate damages was in order

Actual damages, to be recoverable, must not only be capable of proof, but must actually be proved with a
reasonable degree of certainty. The reason is that the court cannot simply rely on speculation, conjecture or
guesswork in determining the fact and amount of damages, but there must be competent proof of the actual
amount of loss, credence can be given only to claims which are duly supported by receipts. The receipts
formally submitted and offered by Paras were limited to the costs of medicines purchased on various times. CA
fixed actual damages only at that small sum of P1,397.95. On its part, Inland offered no definite proof on the
repairs done on its vehicle, or the extent of the material damage.
In awarding temperate damages in lieu of actual damages, the CA did not err, because Paras and Inland
were definitely shown to have sustained substantial pecuniary losses. It would really be a travesty of justice
were the CA now to be held bereft of the discretion to calculate moderate or temperate damages, and thereby
leave Paras and Inland without redress from the wrongful act of Philtranco and its driver. We are satisfied
that the CA exerted effort and practiced great care to ensure that the causal link between the physical injuries of
Paras and the material loss of Inland, on the one hand, and the negligence of Philtranco and its driver, on the
other hand, existed in fact. It also rejected arbitrary or speculative proof of loss. Clearly, the costs of Paras
surgeries and consequential rehabilitation, as well as the fact that repairing Inlands vehicle would no longer be
economical justly warranted the CA to calculate temperate damages of P50,000.00 and P250,000.00
respectively for Paras and Inland.

Paras loss of earning capacity must be compensated

According to Article 2205, (1), of the Civil Code, damages may be recovered for loss or impairment of
earning capacity in cases of temporary or permanent personal injury. Indeed, indemnification for damages
comprehends not only the loss suffered (actual damages or damnum emergens) but also the claimants lost
profits (compensatory damages or lucrum cessans). Even so, the formula that has gained acceptance over time
has limited recovery to net earning capacity; hence, the entire amount of P72,000.00 is not allowable. The
premise is obviously that net earning capacity is the persons capacity to acquire money, less the necessary
expense for his own living. To simplify the determination, therefore, the net earning capacity of Paras during
the 9-month period of his confinement, surgeries and consequential therapy is pegged at only half of his
unearned monthly gross income of P8,000.00 as a trader, or a total of P36,000.00 for the 9-month period, the
other half being treated as the necessary expense for his own living in that period.

Increase in award of attorneys fees

In view of the lapse of a long time in the prosecution of the claim, the Court considers it reasonable and proper
to grant attorneys fees to each of Paras and Inland equivalent to 10% of the total amounts hereby awarded to
them, in lieu of only P20,000.00 for that purpose granted to Paras.

Legal interest on the amounts awarded

[38]
Pursuant to Eastern Shipping Lines, Inc. v. Court of Appeals, legal interest at the rate of 6% per
annum accrues on the amounts adjudged reckoned from July 18, 1997, the date when the RTC rendered its
judgment; and legal interest at the rate of 12% per annum shall be imposed from the finality of the judgment
until its full satisfaction, the interim period being regarded as the equivalent of a forbearance of credit.
Comsavings Bank (now GSIS Family Bank) vs. Sps. Danilo and Estrella Capistrano
G.R. No. 170942, August 28, 2013
BERSAMIN, J.:
A banking institution serving as an originating bank for the lJnitied Home Lending Program (UHLP) of the
Government owes a duty to observe the highest degree of diligence and a high standard of integrity and
performance in all its transactions with its clients because its business is imbued with public interest.
FACTS:
Respondents were the owners of a residential lot with an area of 200 square meters known as Lot 8 of Block 4
of the Infant Jesus Subdivision situated in Bacoor, Cavite, and covered by Transfer Certificate of Title (TCT)
No. 316885 of the Register of Deeds of Cavite. Desirous of building their own house on the lot, they availed
themselves of the UHLP implemented by the National Home Mortgage Finance Corporation (NHMFC). They
executed a construction contract with Carmencita Cruz-Bay, the proprietor of GCB Builders, for the total
contract price of P265,000.00 with the latter undertaking to complete the construction within 75 days. To
finance the construction, GCB Builders facilitated their loan application with Comsavings Bank, an NHFMC-
accredited originator. As proof of their qualifications to avail themselves of a loan under the UHLP and to
comply with the conditions prescribed for the approval of their application, they submitted their record of
employment, the amount of their income, and a clearance from the Social Security System (SSS) to the effect
that they had no existing loans, among others. They executed in favor of GCB Builders a deed of assignment of
the amount of the 300,000.00 proceeds of the loan from Comsavings Bank. Comsavings Bank informed
respondent Estrella Capistrano that she would have to sign various documents as part of the requirements for
the release of the loan. Among the documents was a certificate of house completion and acceptance.
Comsavings Bank handed Estrella a letter addressed to GCB Builders informing the latter that respondents had
complied with the preliminary requirements of the UHLP, and were qualified to avail themselves of the loan
amounting to P303,450.00 payable within 25 years at 16% per annum, subject to the following terms and
conditions, namely: the signing of mortgage documents, 100% completion of the construction of the housing
unit, original certificate of occupancy permit and certification of completion, and submission of house pictures
signed by the borrower at the back. Comsavings Bank informed respondents of the approval of an interim
financing loan of 260,000.00 payable within 180 days, which amount was to be paid out of the proceeds of the
loan from NHMFC. respondents received a letter from NHMFC advising that they should already start paying
their monthly amortizations of P4,278.00 because their loan had been released on April 20, 1993 directly to
Comsavings Bank. On June 1, 1993, Estrella Capistrano went to the construction site and found to her dismay
that the house was still unfinished. respondents wrote to NHMFC protesting the demand for amortization
payments considering that they had not signed any certification of completion and acceptance, and that even if
there was such a certification of completion and acceptance, it would have been forged. Respondents sued GCB
Builders and Comsavings Bank for breach of contract and damages,6 praying that defendants be ordered jointly
and severally liable

ISSUE: Whether or not Comsaving is liable to the respondents

RULING:
Comsaving Banks liability was not based on its purchase of loan agreement with NHMFC but on Article
20 and Article 1170 of the Civil Code
The CA rightfully declared Comsavings Bank solidarily liable with GCB Builders for the damages sustained by
respondents. However, we point out that such liability did not arise from Comsavings Banks breach of
warranties under its purchase of loan agreement with NHMFC. Under the purchase of loan agreement, it
undertook, for value received, to sell, transfer and deliver to NHMFC the loan agreements, promissory notes
and other supporting documents that it had entered into and executed with respondents, and warranted the
genuineness of the loan documents and the construction of the residential units. Having made the warranties
in favor of NHMFC, it would be liable in case of breach of the warranties to NHMFC, not respondents,
eliminating breach of such warranties as a source of its liability towards respondents. Instead, the liability of
Comsavings Bank towards respondents was based on Article 20 and Article 1170 of the Civil Code.
Based on the provisions, a banking institution like Comsavings Bank is obliged to exercise the highest degree
of diligence as well as high standards of integrity and performance in all its transactions because its business is
imbued with public interest. There is no question that Comsavings Bank was grossly negligent in its dealings
with respondents because it did not comply with its legal obligation to exercise the required diligence and
integrity. As a banking institution serving as an originator under the UHLP and being the maker of the
certificate of acceptance/completion, it was fully aware that the purpose of the signed certificate was to affirm
that the house had been completely constructed according to the approved plans and specifications, and that
respondents had thereby accepted the delivery of the complete house. Given the purpose of the certificate, it
should have desisted from presenting the certificate to respondents for their signature without such conditions
having been fulfilled. Yet, it made respondents sign the certificate (through Estrella Capistrano, both in her
personal capacity and as the attorney-in-fact of her husband Danilo Capistrano) despite the construction of the
house not yet even starting. Its act was irregular per se because it contravened the purpose of the certificate.
Ignoring the glaring irregularity, Comsavings Bank accepted the unsigned (hence, unauthenticated) pictures,
released the loan to GCB Builders, and turned over the pictures to NHMFC for the reimbursement of the loan.
Had Comsavings Bank complied with its duty of observing the highest degree of diligence, it would have
checked first whether the pictures carried the signatures of respondents on their dorsal sides, and whether the
house depicted on the pictures was really the house of respondents, before releasing the proceeds of the loan to
GCB Builders and before submitting the pictures to NHMFC for the reimbursement. Again, this is an
indication of Comsavings Banks gross negligence.

Dr. Fernando Solidum vs. People of the Philippines

G.R. No. 192123, March 10, 2014
BERSAMIN, J.:
Res ipsa loquitur is literally translated as the thing or the transaction speaks for itself. The doctrine res ipsa
loquitur means that where the thing which causes injury is shown to be under the management of the
defendant, and the accident is such as in the ordinary course of things does not happen if those who have the
management use proper care, it affords reasonable evidence, in the absence of an explanation by the
defendant, that the accident arose from want of care.
FACTS:
Gerald Albert Gercayo was born with an imperforate anus. Two days after his birth, he underwent
colostomy, a surgical procedure to bring one end of the large intestine out through the abdominal wall. On
May 17, 1995, Gerald, then three years old, was admitted at the Ospital ng Maynila for a pullthrough
operation. Dr. Leandro Resurreccion headed the surgical team. The anesthesiologists included Dr. Marichu
Abella, Dr. Arnel Razon and petitioner Dr. Fernando Solidum (Dr. Solidum). During the operation, Gerald
experienced bradycardia, and went into a coma. His coma lasted for two weeks, but he regained consciousness
only after a month.He could no longer see, hear or move.
Ma. Luz Gercayo, mother of Gerald, lodged a complaint for reckless imprudence resulting in serious
physical injuries with the City Prosecutors Office of Manila against the attending physicians. Upon a finding
of probable cause, the City Prosecutors Office filed an information solely against Dr. Solidum. The RTC
rendered its judgment finding Dr. Solidum guilty beyond reasonable doubt of reckless imprudence resulting to
serious physical injuries. The CA affirmed the conviction.

ISSUES:
1. Whether or not the doctrine of res ipsa loquitor was applicable herein.
2. Whether or not Dr. Solidum was liable for criminal negligence.
3. Whether or not Ospital ng Maynila can be held civilly liable.

RULING:
Res ipsa loquitur is literally translated as the thing or the transaction speaks for itself. The doctrine res ipsa
loquitur means that where the thing which causes injury is shown to be under the management of the
defendant, and the accident is such as in the ordinary course of things does not happen if those who have the
management use proper care, it affords reasonable evidence, in the absence of an explanation by the defendant,
that the accident arose from want of care.
The applicability of the doctrine of res ipsa loquitur in medical negligence cases was significantly and
exhaustively explained in Ramos v. Court of Appeals, where the Court said medical malpractice cases do not
escape the application of this doctrine. Thus, res ipsa loquitur has been applied when the circumstances
attendant upon the harm are themselves of such a character as to justify an inference of negligence as the cause
of that harm.
Although generally, expert medical testimony is relied upon in malpractice suits to prove that a
physician has done a negligent act or that he has deviated from the standard medical procedure, when the
doctrine of res ipsa loquitur is availed by the plaintiff, the need for expert medical testimony is dispensed with
because the injury itself provides the proof of negligence.
In order to allow resort to the doctrine, therefore, the following essential requisites must first be
satisfied, to wit: (1) the accident was of a kind that does not ordinarily occur unless someone is negligent; (2)
the instrumentality or agency that caused the injury was under the exclusive control of the person charged; and
(3) the injury suffered must not have been due to any voluntary action or contribution of the person injured.
The Court considers the application here of the doctrine of res ipsa loquitur inappropriate. Although it
should be conceded without difficulty that the second and third elements were present, considering that the
anesthetic agent and the instruments were exclusively within the control of Dr. Solidum, and that the patient,
being then unconscious during the operation, could not have been guilty of contributory negligence, the first
element was undeniably wanting. Luz delivered Gerald to the care, custody and control of his physicians for a
pullthrough operation. Except for the imperforate anus, Gerald was then of sound body and mind at the time
of his submission to the physicians. Yet, he experienced bradycardia during the operation, causing loss of his
senses and rendering him immobile. Hypoxia, or the insufficiency of oxygen supply to the brain that caused the
slowing of the heart rate, scientifically termed as bradycardia, would not ordinarily occur in the process of a
pullthrough operation, or during the administration of anesthesia to the patient, but such fact alone did not
prove that the negligence of any of his attending physicians, including the anesthesiologists, had caused the
injury.

Negligence is defined as the failure to observe for the protection of the interests of another person that
degree of care, precaution, and vigilance that the circumstances justly demand, whereby such other person
suffers injury. Reckless imprudence, on the other hand, consists of voluntarily doing or failing to do, without
malice, an act from which material damage results by reason of an inexcusable lack of precaution on the part of
the person performing or failing to perform such act.
Dr. Solidums conviction by the RTC was primarily based on his failure to monitor and properly
regulate the level of anesthetic agent administered on Gerald by overdosing at 100% halothane. In finding the
accused guilty, despite the explanations, the RTC argued that the volteface of Dr. Vertido on the question of
the dosage of the anesthetic used on the child would not really validate the nonguilt of the anesthesiologist.
The Prosecution did not prove the elements of reckless imprudence beyond reasonable doubt because
the circumstances cited by the CA were insufficient to establish that Dr. Solidum had been guilty of
inexcusable lack of precaution in monitoring the administration of the anesthetic agent to Gerald.
In litigations involving medical negligence, the plaintiff has the burden of establishing appellants
negligence and for a reasonable conclusion of negligence, there must be proof of breach of duty on the part of
the surgeon as well as a causal connection of such breach and the resulting death of his patient. In other
words, the negligence must be the proximate cause of the injury. For, negligence, no matter in what it consists,
cannot create a right of action unless it is the proximate cause of the injury complained of. And the proximate
cause of an injury is that cause, which, in natural and continuous sequence, unbroken by any efficient
intervening cause, produces the injury, and without which the result would not have occurred. Here, the
Prosecution presented no witnesses with special medical qualifications in anesthesia to provide guidance to the
trial court on what standard of care was applicable. It would consequently be truly difficult, if not impossible,
to determine whether the first three elements of a negligence and malpractice action were attendant.
Dr. Solidum was criminally charged for failing to monitor and regulate properly the levels of
anesthesia administered to said Gerald Albert Gercayo and using 100% halothane and other anesthetic
medications.However, the foregoing circumstances, taken together, did not prove beyond reasonable doubt
that Dr. Solidum had been recklessly imprudent in administering the anesthetic agent to Gerald. The existence
of the probability about other factors causing the hypoxia has engendered in the mind of the Court a reasonable
doubt as to Dr. Solidums guilt, and moves us to acquit him of the crime of reckless imprudence resulting to
serious physical injuries.
We have to clarify that the acquittal of Dr. Solidum would not immediately exempt him from civil
liability. But we cannot now find and declare him civilly liable because the circumstances that have been
established here do not present the factual and legal bases for validly doing so. His acquittal did not derive only
from reasonable doubt. Consequently, to adjudge Dr. Solidum civilly liable would be to speculate on the cause
of the hypoxia. We are not allowed to do so, for civil liability must not rest on speculation but on competent
evidence.

In criminal prosecutions, the civil action for the recovery of civil liability that is deemed instituted with
the criminal action refers only to that arising from the offense charged. It is puzzling, therefore, how the RTC
and the CA could have adjudged Ospital ng Maynila jointly and severally liable with Dr. Solidum for the
damages despite the obvious fact that Ospital ng Maynila, being an artificial entity, had not been charged along
with Dr. Solidum. For one, Ospital ng Maynila was not at all a party in the proceedings. Hence, its fundamental
right to be heard was not respected from the outset. The RTC and the CA should have been alert to this
fundamental defect. Verily, no person can be prejudiced by a ruling rendered in an action or proceeding in
which he was not made a party. Such a rule would enforce the constitutional guarantee of due process of law.
Moreover, Ospital ng Maynila could be held civilly liable only when subsidiary liability would be properly
enforceable pursuant to Article 103 of the Revised Penal Code. But the subsidiary liability seems farfetched
here. The conditions for subsidiary liability to attach to Ospital ng Maynila were not complied with.

BJDC Construction vs. Nena Lanuzo et al

G.R. No. 161151, March 24, 2014
BERSAMIN, J.:
The test by which to determine the existence of negligence in a particular case may be stated as follows: Did
the defendant in doing the alleged negligent act use that reasonable care and caution which an ordinarily
prudent person would have used in the same situation? If not, then he is guilty of negligence. The law here in
effect adopts the standard supposed to be supplied by the imaginary conduct of the discreet paterfamilias of the
Roman law.
FACTS:
Nena E. Lanuzo filed a complaint for damages against BJDC Construction (company), a single
proprietorship engaged in the construction business. The company was the contractor of the reblocking project
to repair the damaged portion of one lane of the national highway at San Agustin, Pili, Camarines Sur. Nena
alleged that she was the surviving spouse of the late Balbino Los Baos Lanuzo (Balbino) who figured in the
accident that transpired at the site of the reblocking work resulting in his instant death; and that the companys
failure to place illuminated warning signs on the site of the project, especially during night time, was the
proximate cause of the death of Balbino. She prayed that the company be held liable for damages. The RTC
rendered judgment in favor of the company holding that the plaintiffs were unable to make out a case for
damages, with a preponderance of evidence. The CA reversed the RTC applying the doctrine of res ipsa
loquitor.

ISSUES:
1. Whether or not the company is to be held liable for the alleged negligence.
2. Whether or not the doctrine of Res Ipsa Loquitor finds application in the given case.

RULING:
Inasmuch as the RTC and the CA arrived at conflicting findings of fact on who was the negligent party, the
Court holds that an examination of the evidence of the parties needs to be undertaken to properly determine the
issue. The Court must ascertain whose evidence was preponderant for Section 1, Rule 133 of the Rules of
Court mandates that in civil cases the party having the burden of proof must establish his case by a
preponderance of evidence. In civil cases, the burden of proof is on the party who would be defeated if no
evidence is given on either side. The burden of proof is on the plaintiff if the defendant denies the factual
allegations of the complaint in the manner required by the Rules of Court, but it may rest on the defendant if he
admits expressly or impliedly the essential allegations but raises affirmative defense or defenses, which if
proved, will exculpate him from liability.
Upon a review of the records, the Court affirms the findings of the RTC, and rules that the Lanuzo heirs, the
parties carrying the burden of proof, did not establish by preponderance of evidence that the negligence on the
part of the company was the proximate cause of the fatal accident of Balbino.

The test by which to determine the existence of negligence in a particular case may be stated as follows: Did
the defendant in doing the alleged negligent act use that reasonable care and caution which an ordinarily
prudent person would have used in the same situation? If not, then he is guilty of negligence. The law here in
effect adopts the standard supposed to be supplied by the imaginary conduct of the discreet paterfamilias of the
Roman law.
First of all, we note that the Lanuzo heirs argued in the trial and appellate courts that there was a total
omission on the part of the company to place illuminated warning signs on the site of the project, especially
during night time, in order to warn motorists of the project. In this appeal, however, they contend that the
negligence of the company consisted in its omission to put up adequate lighting and the required signs to warn
motorists of the project, abandoning their previous argument of a total omission to illuminate the project site. In
contrast, the company credibly refuted the allegation of inadequate illumination. Zamora, its flagman in the
project, rendered an eyewitness account of the accident by stating that the site had been illuminated by light
bulbs and gas lamps.
 Secondly, the company presented as its documentary evidence the investigation report dated December 3,
1997 of SPO1 Corporal (Annex 1), the relevant portions of which indicated the finding of the police
investigator on the presence of illumination at the project:
3. That upon arrival at the scene of the incident it was noted that road sign/barricade installed on the road has a
light.
In our view, the RTC properly gave more weight to the testimonies of Zamora and SPO1 Corporal than
to those of the witnesses for the Lanuzo heirs. There was justification for doing so, because the greater
probability pertained to the former. Absent any showing that the trial courts calibration of the credibility of
the witnesses was flawed, we are bound by its assessment. This Court will sustain such findings unless it can be
shown that the trial court ignored, overlooked, misunderstood, misappreciated, or misapplied substantial facts
and circumstances, which, if considered, would materially affect the result of the case.

NO, the doctrine of res ipsa loquitur had no application here.

For the doctrine to apply, the following requirements must be shown to exist, namely: (a) the accident
is of a kind that ordinarily does not occur in the absence of someones negligence; (b) it is caused by an
instrumentality within the exclusive control of the defendant or defendants; and (c) the possibility of
contributing conduct that would make the plaintiff responsible is eliminated.
The Court has warned in Reyes v. Sisters of Mercy Hospital, however, that res ipsa loquitur is not a
rigid or ordinary doctrine to be perfunctorily used but a rule to be cautiously applied, depending upon the
circumstances of each case. Based on the evidence adduced by the Lanuzo heirs, negligence cannot be fairly
ascribed to the company considering that it has shown its installation of the necessary warning signs and lights
in the project site. In that context, the fatal accident was not caused by any instrumentality within the exclusive
control of the company.

Metro Manila Transit Corporation vs. Reynaldo Cuevas

G.R. No. 167797, June 15, 2015
BERSAMIN, J.:
The registered owner of a motor vehicle whose operation causes injury to another is legally liable to the latter.
But it is error not to allow the registered owner to recover reimbursement from the actual and present owner
by way of its cross-claim.
FACTS:
Metro Manila Transit Corporation (MMTC) and Mina's Transit Corporation (Mina's Transit) entered into an
agreement to sell dated August 31, 1990, whereby the latter bought several bus units from the former at a
stipulated price. They agreed that MMTC would retain the ownership of the buses until certain conditions were
met, but in the meantime Mina's Transit could operate the buses within Metro Manila.
On October 14, 1994, one of the buses subject of the agreement to sell, bearing plate number NXM-449-TB-pil
94, hit and damaged a Honda Motorcycle owned by Reynaldo and driven by Junnel. Reynaldo and Junnel sued
MMTC and Minas Transit for damages in the Regional Trial Court (RTC) in Cavite.
In its answer with compulsory counterclaim and cross-claim, MMTC denied liability, and averred that although
it retained the ownership of the bus, the actual operator and employer of the bus driver was Minas Transit; and
that, in support of its cross-claim against Minas Transit, a provision in the agreement to sell mandated Mina s
Transport to hold it free from liability arising from the use and operation of the bus units.
On its part, Minas Transit contended that it was not liable because: (a) it exercised due diligence in the
selection and supervision of its employees; (b) its bus driver exercised due diligence; and (c) Junnels
negligence was the cause of the accident.
After trial, the RTC rendered judgment in favor of the respondents on September 17, 1999 ordering petitioner
Metro Manila Transit Corporation (MMTC) and its codefendant Minas Transit Corporation (Minas Transit) to
pay damages in favor of respondents Reynaldo Cuevas and Junnel Cuevas. The RTC, however, did not rule on
the propriety of the cross-claim. On appeal, the CA affirmed the RTCs decision.

ISSUE: Whether or not MMTC was liable for the injuries sustained by the respondents despite the provision in
the agreement to sell that shielded it from liability.

RULING:
Petition is partly meritorious. In view of MMTCs admission in its pleadings that it had remained the registered
owner of the bus at the time of the incident, it could not escape liability for the personal injuries and property
damage suffered by the Cuevases. This is because of the registered-owner rule, whereby the registered owner of
the motor vehicle involved in a vehicular accident could be held liable for the consequences. The registered-
owner rule has remained good law in this jurisdiction considering its impeccable and timeless rationale.
Indeed, MMTC could not evade liability by passing the buck to Minas Transit. The stipulation in the
agreement to sell did not bind third parties like the Cuevases, who were expected to simply rely on the data
contained in the registration certificate of the erring bus.
Although the registered-owner rule might seem to be unjust towards MMTC, the law did not leave it without
any remedy or recourse.1wphi1 According to Filcar Transport Services v. Espinas ,14 MMTC could recover
from Minas Transit, the actual employer of the negligent driver, under the principle of unjust enrichment, by
means of a cross-claim seeking reimbursement of all the amounts that it could be required to pay as damages
arising from the drivers negligence. A cross-claim is a claim by one party against a coparty arising out of the
transaction or occurrence that is the subject matter either of the original action or of a counterclaim therein, and
may include a claim that the party against whom it is asserted is or may be liable to the cross-claimant for all or
part of a claim asserted in the action against the cross-claimant.
MMTC set up its cross-claim against Mina's Transit precisely to ensure that Mina's Transit would reimburse
whatever liability would be adjudged against MMTC. Yet, it is a cause of concern for the Court that the RTC
ignored to rule on the propriety of MMTC's crossclaim. Such omission was unwarranted, inasmuch as Mina's
Transit did not dispute the cross-claim, or did not specifically deny the agreement to sell with MMTC, the
actionable document on which the cross-claim was based. Even more telling was the fact that Mina's Transit
did not present controverting evidence to disprove the crossclaim as a matter of course if it was warranted for it
to do so. Under the circumstances, the RTC should have granted the cross-claim to prevent the possibility of a
multiplicity of suits, and to spare not only the MMTC but also the other parties in the case from further expense
and bother. Compounding the RTC's uncharacteristic omission was the CA's oversight in similarly ignoring the
cross-claim. The trial and the appellate courts should not forget that a cross-claim is like the complaint and the
counterclaim that the court must rule upon.
 A CADEMICUS REVIEW CENTER
Dean Ferdinand A. Tan

COMMERCIAL LAW CASES ( 2012 - 2016)

J. BERSAMIN

Gold Line Tours, Inc. vs. Heirs of Maria Concepcion Lacsa

G.R. No. 159108, June 18, 2012
BERSAMIN, J.:
The veil of corporate existence of a corporation is a fiction of law that should not defeat the ends of justice.
FACTS:
Ma. Concepcion Lacsa and her sister, Miriam Lacsa, boarded a Goldline passenger bus with Plate No. NXM-
105 owned and operated by Travel &Tours Advisers, Inc., enroute from Sorsogon to Cubao, Quezon City. At
the time, Concepcion, having just obtained her degree of Bachelor of Science in Nursing at the Ago Medical
and Educational Center, was proceeding to Manila to take the nursing licensure board examination. Upon
reaching the highway at Barangay San Agustin in Pili, Camarines Sur, the Goldline bus, driven by Rene
Abania, collided with a passenger jeepney with Plate No. EAV-313 coming from the opposite direction and
driven by Alejandro Belbis. As a result, a metal part of the jeepney was detached and struck Concepcion in the
chest, causing her instant death. Concepcions heirs, represented by Teodoro Lacsa, instituted in the RTC a suit
against Travel & Tours Advisers Inc. and Abania to recover damages arising from breach of contract of
carriage. SPO1 Corporal opined that based on his investigation report, the driver of the jeepney had been at
fault for failing to observe precautionary measures to avoid the collision; and suggested that criminal and civil
charges should be brought against the operator and driver of the jeepney. On his part, Cheng attested that he
had exercised the required diligence in the selection and supervision of his employees. RTC held that
petitioners are liable. Petitioner submitted a so-called verified third party claim, claiming that the tourist bus
bearing Plate No. NWW-883 be returned to petitioner because it was the owner; that petitioner had not been
made a party to Civil Case; and that petitioner was a corporation entirely different from Travel & Tours
Advisers, Inc.

ISSUE: Did the CA rightly find and conclude that the RTC did not gravely abuse its discretion in denying
petitioners verified third-party claim?

RULING: Yes
RTC had sufficient factual basis to find that petitioner and Travel and Tours Advisers, Inc. were one
and the same entity, specifically: (a) documents submitted by petitioner in the RTC showing that William
Cheng, who claimed to be the operator of Travel and Tours Advisers, Inc., was also the President/Manager and
an incorporator of the petitioner; and (b) Travel and Tours Advisers, Inc. had been known in Sorsogon as
Goldline. The RTC thus rightly ruled that petitioner might not be shielded from liability under the final
judgment through the use of the doctrine of separate corporate identity. Truly, this fiction of law could not be
employed to defeat the ends of justice.

Zuellig Freight and Cargo Systems vs. NLRC

G.R. No. 157900, July 22, 2013
BERSAMIN, J.:
The mere change in the corporate name is not considered under the law as the creation of a new corporation;
hence, the renamed corporation remains liable for the illegal dismissal of its employee separated under that
guise.
FACTS:
San Miguel brought a complaint for unfair labor practice, illegal dismissal, non-payment of salaries and moral
damages against petitioner, formerly known as Zeta Brokerage Corporation (Zeta). He alleged that he had been
a checker/customs representative of Zeta since December 16, 1985; that in January 1994, he and other
employees of Zeta were informed that Zeta would cease operations, and that all affected employees, including
him, would be separated; that by letter dated February 28, 1994, Zeta informed him of his termination effective
March 31, 1994; that he reluctantly accepted his separation pay subject to the standing offer to be hired to his
former position by petitioner; and that on April 15, 1994, he was summarily terminated, without any valid
cause and due process. San Miguel contended that the amendments of the articles of incorporation of Zeta were
for the purpose of changing the corporate name, broadening the primary functions, and increasing the capital
stock; and that such amendments could not mean that Zeta had been thereby dissolved. Labor Arbiter Francisco
A. Robles rendered a decision holding that San Miguel had been illegally dismissed.

ISSUE: Whether or not petitioner is the same as Zeta Corporation

RULING: Yes
The amendments of the articles of incorporation of Zeta to change the corporate name to Zuellig Freight and
Cargo Systems, Inc. did not produce the dissolution of the former as a corporation. For sure, the Corporation
Code defined and delineated the different modes of dissolving a corporation, and amendment of the articles of
incorporation was not one of such modes. The effect of the change of name was not a change of the corporate
being, for, as well stated in Philippine First Insurance Co., Inc. v. Hartigan: The changing of the name of a
corporation is no more the creation of a corporation than the changing of the name of a natural person is
begetting of a natural person. The act, in both cases, would seem to be what the language which we use to
designate it imports a change of name, and not a change of being.
In short, Zeta and petitioner remained one and the same corporation. The change of name did not give
petitioner the license to terminate employees of Zeta like San Miguel without just or authorized cause. The
situation was not similar to that of an enterprise buying the business of another company where the purchasing
company had no obligation to rehire terminated employees of the latter. Petitioner, despite its new name, was
the mere continuation of Zeta's corporate being, and still held the obligation to honor all of Zeta's obligations,
one of which was to respect San Miguel's security of tenure. The dismissal of San Miguel from employment on
the pretext that petitioner, being a different corporation, had no obligation to accept him as its employee, was
illegal and ineffectual.

Terelay Investment and Development Corporation vs. Cecilia Teresita

G.R. No. 160924, August 5, 2015
BERSAMIN, J.:
It is well-settled that the ownership of shares of stock gives stockholders the right under the law to be protected
from possible mismanagement by its officers. This right is predicated upon self-preservation.
FACTS:
Asserting her right as a stockholder, Cecilia Teresita Yulo wrote a letter addressed to Terelay Investment and
Development Corporation (TERELAY) requesting that she be allowed to examine its books and records at the
latters office on the 25th floor, Citibank Tower, Makati City. TERELAY denied the request for inspection and
instead demanded that she show proof that she was a bona fide stockholder. Cecilia Yulo again sent another
letter clarifying that her request for examination of the corporate records was for the purpose of inquiring into
the financial condition of TERELAY and the conduct of its affairs by the principal officers. The following day,
Cecilia Yulo received a faxed letter from TERELAYs counsel advising her not to continue with the inspection
in order to avoid trouble. Cecilia Yulo filed with the Securities and Exchange Commission (SEC), a Petition for
Issuance of a Writ of Mandamus with prayer for Damages against TERELAY. In her petition, she prayed that
judgment be rendered ordering TERELAY to allow her to inspect its corporate records, books of account and
other financial records.

ISSUE: Whether or not Cecilia Yulo is a stockholder and therefore, has the right to inspect the corporate books
and records

RULING: Yes
Cecilia Yulo has the right to be fully informed of TERELAY's corporate condition and the manner its affairs
are being managed.
TERELAY points out that Yulos name as incorporator, stockholder and director in the Articles of
Incorporation and Amendments were unsigned; that she did not pay for the five shares appearing in the
Amended Articles of Incorporation and General Information Sheet of TERELAY; that she did not subscribe to
the shares; that she has neither been in possession of nor seen the certificate of stock covering the five shares of
stock; that the donation of the five shares claimed by her was null and void for failure to comply with the
requisites of a donation under Art. 748 of the Civil Code; and that there was no acceptance of the donation by
her as donee. TERELAY further contends that Cecilia Yulo's purpose in inspecting the books was to inquire
into its financial condition and the conduct of its affairs by the principal officers which are not sufficient and
valid reasons. Therefore, the presumption of good faith cannot be accorded her.

It is well-settled that the ownership of shares of stock gives stockholders the right under the law to be
protected from possible mismanagement by its officers. This right is predicated upon self-preservation. The
records disclose that the corporate documents submitted, which include the Articles of Incorporation and the
Amended Articles of Incorporation, as well as the General Information Sheets and the Quarterly Reports all
bear the signatures of the proper parties and their authorized custodians. The signature of respondent under the
name Cecilia J. Yulo appears in the Articles of Incorporation of TERELAY. Likewise, her signatures under the
name Cecilia Y. Blancaflor appear in the Amended Articles of Incorporation where she signed as Director and
Corporate Secretary of TERELAY. The General Information Sheets from December 31, 1977 up to February
20, 2002 all exhibited that she was recognized as director and corporate secretary, and that she had subscribed
to five (5) shares of stock. The quarterly reports do not show otherwise.

Verily, respondent has presented enough evidence that she is a stockholder of TERELAY. The
corporate documents presented support her claim that she is a registered stockholder in TERELAY's stock and
transfer book thus giving her the right, under Section 74 par. 2 and Section 75 of the Philippine Corporation
Law, to inspect TERELAY's books, records, and financial statements. Further, a careful review of the records
would show that in the Preliminary Conference Order, dated May 16, 2000, of the SEC Hearing Officer, both
parties represented by their respective counsels, agreed on the fact that respondent was "registered as a
stockholder in petitioner's stock and transfer book subject to the qualifications in the Answer." The records
failed to disclose any objection by TERELAY. In any case, TERELAY did not adduce sufficient proof that
Cecilia Yulo was in bad faith or had an ulterior motive in demanding her right under the law.

The petitioner's submission that the respondent's "insignificant holding" of only .001% of the petitioner's
stockholding did not justify the granting of her application for inspection of the corporate books and records is
also unwarranted. The Corporation Code has granted to all stockholders the right to inspect the corporate books
and records, and in so doing has not required any specific amount of interest for the exercise of the right to
inspect. Ubi lex non distinguit nee nos distinguere debemos. When the law has made no distinction, we ought
not to recognize any distinction.

Interport Resources Corp. vs. Securities Specialist Inc and R.C. Lee Securities Inc.
G.R. No. 154069, June 6, 2016
BERSAMIN, J.:
Under Section 63 of the Corporation Code, no transfer of shares of stock shall be valid, except as between the
parties, until the transfer is recorded in the books of the corporation so as to show the names of the parties to
the transaction, the date of the transfer, the number of the certificate or certificates and the number of shares
transferred.
FACTS:
In January 1977, Oceanic Oil & Mineral Resources, Inc. entered into a subscription agreement with R.C. Lee, a
domestic corporation engaged in the trading of stocks and other securities, covering 5,000,000 of its shares with
par value of P0.01 per share, for a total of P50,000.00. Thereupon, R.C. Lee paid 25% of the subscription,
leaving 75% unpaid. Consequently, Oceanic issued Subscription Agreements Nos. 1805, 1808, 1809, 1810, and
1811 to R.C. Lee. Oceanic merged with Interport, with the latter as the surviving corporation. Interport was a
publicly-listed domestic corporation whose shares of stocks were traded in the stock exchange. Under the terms
of the merger, each share of Oceanic was exchanged for a share of lnterport. SSI, a domestic corporation
registered as a dealer in securities, received in the ordinary course of business Oceanic Subscription
Agreements Nos. 1805, 1808 to 1811, all outstanding in the name of R.C. Lee, and Oceanic official receipts
showing that 25% of the subscriptions had been paid. The Oceanic subscription agreements were duly
delivered to SSI through stock assignments indorsed in blank by R.C. Lee. Later on, R.C. Lee requested
Interport for a list of subscription agreements and stock certificates issued in the name of R.C. Lee and other
individuals named in the request. Upon finding no record showing any transfer or assignment of the Oceanic
subscription agreements and stock certificates of Interport as contained in the list, R.C. Lee paid its unpaid
subscriptions and was accordingly issued stock certificates corresponding thereto. SSI directly tendered
payment to lnterport for the balance of the 5,000,000 shares covered by the Oceanic subscription agreements,
some of which were in the name of R.C. Lee and indorsed in blank. Interport originally rejected the tender of
payment for all unpaid subscriptions on the ground that the Oceanic subscription agreements should have been
previously converted to shares in lnterport.

ISSUE: Whether or not Interport was liable to deliver the Oceanic shares of stock, or the value thereof

RULING: Yes
The SEC correctly categorized the assignment of the subscription agreements as a form of novation by
substitution of a new debtor and which required the consent of or notice to the creditor. Under the Civil Code,
obligations may be modified by: (1) changing their object or principal conditions; or (2) substituting the person
of the debtor; or (3) subrogating a third person in the rights of the creditor. Novation, which consists in
substituting a new debtor in the place of the original one, may be made even without the knowledge or against
the will of the latter, but not without the consent of the creditor. In this case, the change of debtor took place
when R.C. Lee assigned the Oceanic shares under Subscription Agreement Nos. 1805, and 1808 to 1811 to SSI
so that the latter became obliged to settle the 75% unpaid balance on the subscription. The SEC likewise did
not err in appreciating the fact that Interport was duly notified of the assignment when SSI tendered its payment
for the 75% unpaid balance, and that it could not anymore refuse to recognize the transfer of the subscription
that SSI sufficiently established by documentary evidence. The effect of the assignment of the subscription
agreements to SSI was to extinguish the obligation of R.C. Lee to Oceanic, now Interport, to settle the unpaid
balance on the subscription. As a result of the assignment, Interport was no longer obliged to accept any
payment from R.C. Lee because the latter had ceased to be privy to Subscription Agreements Nos. 1805, and
1808 to 1811 for having been extinguished insofar as it was concerned. On the other hand, Interport was legally
bound to accept SSI's tender of payment for the 75% balance on the subscription price because SSI had become
the new debtor under Subscription Agreements Nos. 1805, and 1808 to 1811. As such, the issuance of the stock
certificates in the name of R.C. Lee had no legal basis in the absence of a contractual agreement between R. C.
Lee and Interport.
Under Section 63 of the Corporation Code, no transfer of shares of stock shall be valid, except as between the
parties, until the transfer is recorded in the books of the corporation so as to show the names of the parties to
the transaction, the date of the transfer, the number of the certificate or certificates and the number of shares
transferred. This statutory rule cannot be strictly applied herein, however, because lnterport had unduly refused
to recognize the assignment of the shares between R.C. Lee and SSL. Subscription Agreements Nos. 1805, and
1808 to 1811 were now binding between Interport and SSI only, and only such parties were expected to comply
with the terms thereof.

Victorio Diaz vs. People of the Philippines and Levi Strauss

G.R. No. 180677, February 18, 2013
BERSAMIN, J.:
It is the tendency of the allegedly infringing mark to be confused with the registered trademark that is the
gravamen of the offense of infringement of a registered trademark. The acquittal of the accused should follow if
the allegedly infringing mark is not likely to cause confusion. Thereby, the evidence of the State does not satisfy
the quantum of proof beyond reasonable doubt.
FACTS:
After receiving information that Diaz was selling counterfeit LEVIS 501 jeans in his tailoring shops in
Almanza and Talon, Las Pias City, Levis Philippines hired a private investigation group to verify the
information. Armed with the search warrants, NBI agents searched the tailoring shops of Diaz and seized
several fake LEVIS 501 jeans from them. Levis Philippines claimed that it did not authorize the making and
selling of the seized jeans; that each of the jeans were mere imitations of genuine LEVIS 501 jeans by each of
them bearing the registered trademarks, like the arcuate design, the tab, and the leather patch; and that the
seized jeans could be mistaken for original LEVIS 501 jeans due to the placement of the arcuate, tab, and two-
horse leather patch. Department of Justice filed two informations in the RTC of Las Pias City, charging Diaz
with violation of Section 155, in relation to Section 170, of Republic Act No. 8293, also known as the
Intellectual Property Code of the Philippines.

ISSUE: (1) Whether the CA properly dismissed the appeal of Diaz due to the late filing of his appellants brief
(2) Whether or not Diaz committed trademark infringement

RULING: (1) No (2) No

Under Section 7, Rule 44 of the Rules of Court, the appellant is required to file the appellants brief in the CA
within forty-five (45) days from receipt of the notice of the clerk that all the evidence, oral and documentary,
are attached to the record, seven (7) copies of his legibly typewritten, mimeographed or printed brief, with
proof of service of two (2) copies thereof upon the appellee. Section 1(e) of Rule 50 of the Rules of Court
grants to the CA the discretion to dismiss an appeal either motu proprio or on motion of the appellee should the
appellant fail to serve and file the required number of copies of the appellants brief within the time provided
by the Rules of Court. The usage of the word may in Section 1(e) of Rule 50 indicates that the dismissal of the
appeal upon failure to file the appellants brief is not mandatory, but discretionary. Verily, the failure to serve
and file the required number of copies of the appellants brief within the time provided by the Rules of Court
does not have the immediate effect of causing the outright dismissal of the appeal. Under the circumstances, the
failure to file the appellants brief on time rightly deserved the outright rejection of the appeal. The acts of his
counsel bound Diaz like any other client. It was, of course, only the counsel who was well aware that the Rules
of Court fixed the periods to file pleadings and equally significant papers like the appellants brief with the
lofty objective of avoiding delays in the administration of justice.
The elements of the offense of trademark infringement under the Intellectual Property Code are, therefore, the
following:
1. The trademark being infringed is registered in the Intellectual Property Office;
2. The trademark is reproduced, counterfeited, copied, or colorably imitated by the infringer;
3. The infringing mark is used in connection with the sale, offering for sale, or advertising of any goods,
business or services; or the infringing mark is applied to labels, signs, prints, packages, wrappers,
receptacles or advertisements intended to be used upon or in connection with such goods, business or
services;
4. The use or application of the infringing mark is likely to cause confusion or mistake or to deceive
purchasers or others as to the goods or services themselves or as to the source or origin of such goods
or services or the identity of such business; and
5. The use or application of the infringing mark is without the consent of the trademark owner or the
assignee thereof.
As can be seen, the likelihood of confusion is the gravamen of the offense of trademark infringement. There
are two tests to determine likelihood of confusion, namely: the dominancy test, and the holistic test. The
dominancy test focuses on the similarity of the main, prevalent or essential features of the competing
trademarks that might cause confusion. Infringement takes place when the competing trademark contains the
essential features of another. Imitation or an effort to imitate is unnecessary. The question is whether the use
of the marks is likely to cause confusion or deceive purchasers. The holistic test considers the entirety of the
marks, including labels and packaging, in determining confusing similarity. The focus is not only on the
predominant words but also on the other features appearing on the labels.
The holistic test is applicable here considering that the herein criminal cases also involved trademark
infringement in relation to jeans products. Accordingly, the jeans trademarks of Levis Philippines and Diaz
must be considered as a whole in determining the likelihood of confusion between them. The maong pants or
jeans made and sold by Levis Philippines, which included LEVIS 501, were very popular in the Philippines.
The consuming public knew that the original LEVIS 501 jeans were under a foreign brand and quite
expensive. Such jeans could be purchased only in malls or boutiques as ready-to-wear items, and were not
available in tailoring shops like those of Diazs as well as not acquired on a made-to-order basis. Under the
circumstances, the consuming public could easily discern if the jeans were original or fake LEVIS 501, or
were manufactured by other brands of jeans. Confusion and deception were remote. Diaz used the trademark
LS JEANS TAILORING for the jeans he produced and sold in his tailoring shops. His trademark was
visually and aurally different from the trademark LEVI STRAUSS & CO appearing on the patch of original
jeans under the trademark LEVIS 501. The word LS could not be confused as a derivative from LEVI
STRAUSS by virtue of the LS being connected to the word TAILORING, thereby openly suggesting that
the jeans bearing the trademark LS JEANS TAILORING came or were bought from the tailoring shops of
Diaz, not from the malls or boutiques selling original LEVIS 501 jeans to the consuming public. There were
other remarkable differences between the two trademarks that the consuming public would easily perceive.
Moreover, based on the certificate issued by the Intellectual Property Office, LS JEANS TAILORING was a
registered trademark of Diaz. He had registered his trademark prior to the filing of the present cases.21 The
Intellectual Property Office would certainly not have allowed the registration had Diazs trademark been
confusingly similar with the registered trademark for LEVIS 501 jeans.

Microsoft Corporation vs. Rolando Manansala

G.R. No. 166391, October 21, 2015
BERSAMIN, J.:
The gravamen of copyright infringement is not merely the authorized manufacturing of intellectual works but
rather the unauthorized performance of any of the acts covered by Sec. 5. Accordingly, the commission of any
of the acts mentioned in Sec. 5 of PD 49 without copyright owners consent constituted actionable copyright
infringement.
FACTS:
Petitioner is the copyright and trademark owner of all rights relating to all versions and editions of Microsoft
software (computer programs). Private Respondent-Rolando Manansala is doing business under the name of
DATAMAN TRADING COMPANY and/or COMIC ALLEY with business address at 3rd Floor, University
Mall Building, Taft Ave., Manila. Private Respondent Manansala, without authority from petitioner, was
engaged in distributing and selling Microsoft computer software programs. Mr. John Benedict A. Sacriz, a
private investigator accompanied by an agent from the National Bureau of Investigation (NBI) was able to
purchase six (6) CD-ROMs containing various computer programs belonging to petitioner. Search Warrant was
issued against the premises of the private respondent. The search warrant was served on the private
respondents premises and yielded several illegal copies of Microsoft programs. Petitioner, through Atty.
Teodoro Kalaw IV filed an Affidavit-Complaint in the DOJ based on the results of the search and seizure
operation conducted on private respondents premises.

ISSUE: Whether or not the mere selling of pirated computer software constituted copyright infringement.

RULING:
Sec. 5 of PD 49 specifically defined copyright as an exclusive right in the following manner:
A. To print, reprint, publish, copy, distribute, multiply, sell and make photographs, photo-engravings and
pictorial illustrations of the works;
B. To make any translation or other version or extracts or arrangements or adaptations thereof; to
dramatize it if it be a non-dramatic work; to convert it into a non-dramatic work if it be a drama; to
complete or execute if it be a model or design;
C. To exhibit, perform, represent, produce, or reproduce, the work in any manner or by any method
whatever for profit or otherwise; it not reproduced in copies for sale, to sell any manuscript or any
record whatsoever thereof;
D. To make any other use or disposition of the work consistent with the laws of the land.

The gravamen of copyright infringement is not merely the authorized manufacturing of intellectual works but
rather the unauthorized performance of any of the acts covered by Sec. 5. Accordingly, the commission of any
of the acts mentioned in Sec. 5 of PD 49 without copyright owners consent constituted actionable copyright
infringement. Presidential Decree No. 49 thereby already acknowledged the existence of computer programs as
works or creations protected by copyright. To hold, as the CA incorrectly did, that the legislative intent was to
require that the computer programs be first photographed, photoengraved, or pictorially illustrated as a
condition for the commission of copyright infringement invites ridicule. Such interpretation of Section 5(a) of
Presidential Decree No. 49 defied logic and common sense because it focused on terms like copy, multiply,
and sell, but blatantly ignored terms like photographs, photo-engravings, and pictorial illustrations.

In this case, the mere sale of the illicit copies of the software programs was enough by itself to show the
existence of probable cause for copyright infringement. There was no need for the petitioner to still prove who
copied, replicated or reproduced the software programs.
Capital Insurance and Surety Co. vs. Del Monte Motor Works
G.R. No. 159979, December 9, 2015
BERSAMIN, J. .
FACTS:
Respondent sued Vilfran Liner, Inc., Hilaria F. Villegas and Maura F. Villegas in the Regional Trial Court in
Quezon City (RTC) to recover the unpaid billings related to the fabrication and construction of 35 passenger
bus bodies. It applied for the issuance of a writ of preliminary attachment. Branch 221 of the RTC, to which the
case was assigned, issued the writ of preliminary attachment, which the sheriff served on the defendants,
resulting in the levy of 10 buses and three parcels of land belonging to the defendants. The sheriff also sent
notices of garnishment of the defendants funds in the Quezon City branches of BPI Family Bank, China. Bank,
Asia Trust Bank, City Trust Bank, and Bank of the Philippine Island. The levy and garnishment prompted
defendant Maura F. Villegas to file an Extremely Urgent Motion 'to Discharge Upon Filing of a Counterbond.
On July 2, 1997, the RTC approved the counterbond and discharged the writ of preliminary attachment. On
January 15, 2002, the RTC rendered its decision in favor of the respondent.

ISSUE: Are the securities deposited by1 the insurance company pursuant to I Section 203 of the Insurance
Code 1subject of levy by a creditor?

RULING:
The petitioner cannot evade liability under the counterbond by hiding behind its own internal rules. Although a
prospective applicant seeking insurance coverage is expected to exercise prudence and diligence in selecting
the insurance provider, such responsibility does not require the prospective applicant to know and be aware of
the insurer's internal rules, policies and procedure adopted for the conduct of its business. Considering that the
petitioner has been a duly accredited bonding company, the officers who signed the bonds were presumed to be
acting within the scope of their authority in behalf of the company, and the courts were not expected to verify
the limits of the authority of the ,signatories of the bonds submitted in the regular course of judicial business, in
the same manner that the applicants for the bonds were not expected to know the limits of the authority of the
signatories. To insist otherwise is absurd. It is reasonable to hold here, therefore, that as between the petitioner
and the respondent, the one who employed and gave character to the third person as its agent should be the one
to bear the loss. That party was the petitioner.
Likewise, the petitioner's argument that the counterbond was invalid because the counterbond was unaccounted
for and missing from its custody was implausible. The argument totally overlooks a simple tenet that honesty,
good faith, and fair dealing required it a's the insurer to communicate such an important fact to the assured, or
at least keep the latter updated on the relevant facts. A contrary view would place every person seeking
insurance at the insurer's mercy because the latter would simply claim so just to escape liability, thus causing
uncertainty to the public and defeating the very purpose for which the insurance was contracted.
An insurer or bonding company like the petitioner that seeks to defeat a claim on the ground that the
counterbond was invalidly issued has the burden of proving such defense. However, the petitioner did not
discharge the burden herein. No less than the officers charged with the responsibility of making sure that all
forms and records of the petitioner were audited admitted that the missing counterbond as in fact a valid pre-
approved form of the Insurance Commission, so that the absence or lack of the signature of the president did
not render the bond i!\valid. Moreover, Laxa knew that as a matter of long practice both Ancheta and Alub
normally signed and approved the counterbonds, regardless' of the amounts thereof. She further I knew of no
rule that limited the authority of Ancheta and Alub to issue and I sign counterbonds only up to P5,000,000.00
 A CADEMICUS REVIEW CENTER
Dean Ferdinand A. Tan

CRIMINAL LAW CASES ( 2012 - 2016)

J.BERSAMIN

People of the Philippines vs. Melanio del Castillo et. al.

G.R. No. 169084 | January 18, 2012
BERSAMIN, J.:
In self-defense and defense of strangers, unlawful aggression is a primordial element, a condition sine qua non.
If no unlawful aggression attributed to the victim is established, self-defense and defense of strangers are
unavailing, because there would be nothing to repel.
FACTS:
City Prosecutors Office of Batangas City charged all the accused in RTC with murder of Sabino Guinhawa,
Graciano Delgado and Victor Noriega. The accused pleaded not guilty. Perfinian, the eyewitness, saw the
assault by all the accused against Sabino D. Guinhawa, Graciano A. Delgado, and Victor B. Noriega. Perfinian
recalled that the accused surrounded their victims during the assault; that Arnold stabbed Graciano on the
stomach with a bolo, causing Graciano to fall to the ground; that Rico hacked Graciano with a bolo; that when
Victor tried to escape by running away, Hermogenes and Felix pursued and caught up with him; that Felix
hacked Victor; and that when Sabino ran away, Melanio and Joven pursued him.
PO3 Aguda was on duty as the desk officer of the Batangas City Police Station when he received the report
about the dead bodies found in Bulihan. During his investigation, he came upon one Rene Imbig who
mentioned seeing the six accused wielding bolos. From the site of the crime, he and his fellow officers went to
the houses of Melanio and Rico, which were about 20 meters from where the bodies were found. The houses
were abandoned, but he recovered a blood-stained knife with a curved end in Melanios house. Returning to the
station, he saw Hermogenes there, who informed him that the other suspects had fled to Sitio Tangisan,
Barangay Mayamot, Antipolo, Rizal, where Melanios mother-in-law resided. Accompanied by Rene and other
police officers, he travelled to Sitio Tangisan that afternoon. Upon arriving in Sitio Tangisan, Rene pointed to
Melanio who was just stepping out of his mother-in-laws house. Melanio ran upon seeing their approach, but
they caught up with him and subdued him. They recovered a bolo from Melanio. They found and arrested the
other suspects in the house of Melanios mother-in-law, and brought all the arrested suspects back to Batangas
City for investigation. There, the suspects admitted disposing some of their clothes by throwing them into the
Pasig River, and said that their other clothes were in the house of Melanio. They mentioned that the bolo used
by Hermogenes was still in his house. PO3 Aguda and his fellow officers recovered two shorts, a shirt, and a
knife - all blood-stained from Melanios house in Bulihan. Going next to the house of Hermogenes, Winifreda
del Castillo, the latters wife, turned over the bolo of Hermogenes. They learned that prior to the killings,
Melanio had been fuming at being cheated in a cockfight, and had uttered threats to kill at least three persons in
Bulihan.
Domingo Guinhawa, the elder brother of Sabino, declared that his family spent P50,000.00 for Sabinos funeral
and burial expenses. Rosalia Delgado, a sister of Graciano, attested that the expenses incurred for Gracianos
burial amounted to P51,510.00. Abella Perez Noriega, the wife of Victor, claimed that her family
spent P53,395.00 for Victors wake and interment. RTC convicted the accused of murder, but appreciated
voluntary surrender as a mitigating circumstance in favor of Hermogenes. CA affirmed the convictions,
correcting only the awards of damages and the penalty imposed on Hermogenes.

ISSUE: Whether or not Arnold and Joven must be acquitted of the crime charged

RULING:
We reiterate that the trial judges evaluation of the credibility of a witness and of his testimony is accorded the
highest respect because of the trial judges unique opportunity to directly observe the demeanor of the witness
that enables him to determine whether the witness is telling the truth or not. Such evaluation, when affirmed by
the CA, is binding on the Court unless the appellant reveals facts or circumstances of weight that were
overlooked, misapprehended, or misinterpreted that, if considered, would materially affect the disposition of
the case. The accused did not present any fact or circumstance of weight that the RTC or the CA overlooked,
misapprehended, or misinterpreted that, if considered, would alter the result herein.
Perfinians identification of all the accused as the perpetrators was positive and reliable for being based on his
recognition of each of them during the incident. His being familiar with each of them eliminated any possibility
of mistaken identification. He spotted them from a distance of only six meters away under a good condition of
visibility (i.e., the moon then being very bright). Consequently, their denials and alibi were properly rejected.
Perfinian detailed the distinct acts done by each of the accused during their assault. Such recollection of the
fatal events was categorical and strong, and there was no better indicator of the reliability and accuracy of his
recollection than its congruence with the physical evidence adduced at the trial. The accused did not show if
Perfinian had harbored any ill-feeling towards any or all of them that he was moved to testify falsely against
them.

Arnold and Joven did not act in self-defense and in defense of strangers
In order for self-defense to be appreciated, the accused must prove by clear and convincing evidence the
following elements: (a) unlawful aggression on the part of the victim; (b) reasonable necessity of the means
employed to prevent or repel it; and (c) lack of sufficient provocation on the part of the person defending
himself. On the other hand, the requisites of defense of strangers are, namely: (a) unlawful aggression by the
victim; (b) reasonable necessity of the means to prevent or repel it; and (c) the person defending be not induced
by revenge, resentment, or other evil motive.
In self-defense and defense of strangers, unlawful aggression is a primordial element, a condition sine qua non.
If no unlawful aggression attributed to the victim is established, self-defense and defense of strangers are
unavailing, because there would be nothing to repel. The character of the element of unlawful aggression has
been aptly described in People v. Nugas, Accordingly, the accused must establish the concurrence of three
elements of unlawful aggression, namely: (a) there must be a physical or material attack or assault; (b) the
attack or assault must be actual, or, at least, imminent; and (c) the attack or assault must be unlawful.

Unlawful aggression is of two kinds: (a) actual or material unlawful aggression; and (b) imminent unlawful
aggression. Actual or material unlawful aggression means an attack with physical force or with a weapon, an
offensive act that positively determines the intent of the aggressor to cause the injury. Imminent unlawful
aggression means an attack that is impending or at the point of happening; it must not consist in a mere
threatening attitude, nor must it be merely imaginary, but must be offensive and positively strong (like aiming a
revolver at another with intent to shoot or opening a knife and making a motion as if to attack). Imminent
unlawful aggression must not be a mere threatening attitude of the victim, such as pressing his right hand to his
hip where a revolver was holstered, accompanied by an angry countenance, or like aiming to throw a pot.
By invoking self-defense and defense of strangers, Arnold and Joven in effect admitted their parts in killing the
victims. The rule consistently adhered to in this jurisdiction is that when the accuseds defense is self-defense
he thereby admits being the author of the death of the victim, that it becomes incumbent upon him to prove the
justifying circumstance to the satisfaction of the court. The rationale for the shifting of the burden of evidence
is that the accused, by his admission, is to be held criminally liable unless he satisfactorily establishes the fact
of self-defense. But the burden to prove guilt beyond reasonable doubt is not thereby lifted from the shoulders
of the State, which carries it until the end of the proceedings. In other words, only the onus probandi shifts to
the accused, for self-defense is an affirmative allegation that must be established with certainty by sufficient
and satisfactory proof.2 He must now discharge the burden by relying on the strength of his own evidence, not
on the weakness of that of the Prosecution, considering that the Prosecutions evidence, even if weak, cannot be
disbelieved in view of his admission of the killing.

Arnold and Joven did not discharge their burden.

Arnold and Joven did not adequately prove unlawful aggression; hence, neither self-defense nor defense of
stranger was a viable defense for them. We note that in addition to the eyewitness account of Perfinian directly
incriminating them, their own actuations immediately after the incident confirmed their guilt beyond reasonable
doubt. As the CA cogently noted, their flight from the neighborhood where the crimes were committed, their
concealing of the weapons used in the commission of the crimes, their non-reporting of the crimes to the police,
and their failure to surrender themselves to the police authorities fully warranted the RTCs rejection of their
claim of self-defense and defense of stranger.

The State duly established conspiracy and abuse of superior strength

The accused, armed with bolos, surrounded and attacked the victims, and pursued whoever of the latter
attempted to escape from their assault. Thereafter, the accused, except Hermogenes, fled their homes and
together hastily proceeded to Antipolo, Rizal. Their individual and collective acts prior to, during and following
the attack on the victims reflected a common objective of killing the latter. Thereby, all the accused, without
exception, were co-conspirators. Conspiracy exists when two or more persons come to an agreement
concerning the commission of a felony and decide to commit it. Conspiracy is either express or implied. Thus,
the State does not always have to prove the actual agreement to commit the crime in order to establish
conspiracy, for it is enough to show that the accused acted in concert to achieve a common purpose.
Conspiracy may be deduced from the mode and manner of the commission of the offense, or from the acts of
the accused before, during and after the commission of the crime indubitably pointing to a joint purpose, a
concert of action and a community of interest. Where the acts of the accused collectively and individually
demonstrate the existence of a common design towards the accomplishment of the same unlawful purpose,
conspiracy is evident, and all the perpetrators will be liable as principals. Once a conspiracy is established, each
co-conspirator is as criminally liable as the others, for the act of one is the act of all. A co-conspirator does not
have to participate in every detail of the execution; neither does he have to know the exact part performed by
the co-conspirator in the execution of the criminal act.
In view of the foregoing, the Court rejects the pleas for exculpation of the other accused grounded on their
respective alibis considering that Arnold and Jovens admission of sole responsibility for the killings did not
eliminate their liability as co-conspirators. Abuse of superior strength is an aggravating circumstance that
qualifies the killing of a person to murder. It is present if the accused purposely uses excessive force out of
proportion to the means of defense available to the person attacked, or if there is notorious inequality of forces
between the victim and aggressor, and the latter takes advantage of superior strength. Superiority in strength
may refer to the number of aggressors and weapons used.
The CA concluded that the mitigating circumstance of voluntary surrender should not be appreciated in favor
of Hermogenes. In order that voluntary surrender is appreciated as a mitigating circumstance, the following
requisites must concur: (a) the accused has not been actually arrested; (b) the accused surrenders himself to a
person in authority or the latters agent; and (c) surrender is voluntary. The third requisite requires the surrender
to be spontaneous, indicating the intent of the accused to unconditionally submit himself to the authorities,
either because he acknowledges his guilt or he wishes to save them the trouble and expenses necessary for his
search and capture. Although Hermogenes went to Barangay Chairman Aloria of Bulihan after the killings, he
did so to seek protection against the retaliation of the victims relatives, not to admit his participation in the
killing of the victims.

People of the Philippines vs. Geron De Los Santos

G.R. No. 170839, January 18, 2012
BERSAMIN, J.:
The mere denial of knowledge that a substance is a regulated drug is insufficient to exculpate the person found
in possession of it, for he must have to satisfactorily explain how the drug came to his possession. Without his
satisfactory explanation, he will be presumed to have animus possidendi, or the intent to possess. His guilt will
then be established beyond reasonable doubt.
FACTS:
An alert security guard halted Geron Delos Santos y Maristela as he was about to bring a gift-wrapped
box out of the Somerset Condominium in Leveriza Street, Pasay City. When Delos Santos opened the box for
inspection upon demand of the security guard, the box contained plastic bags with 6.2 kilograms of
suspected shabu. The security guard forthwith apprehended Delos Santos and impounded the box and its
contents. The National Bureau of Investigation (NBI) was immediately notified of the incident, and it
dispatched its agents to the place. Subsequently, Delos Santos was charged with a violation of Section 16 of
Republic Act No. 6425 (Dangerous Drugs Act of 1972). Regional Trial Court, Branch 119, in Pasay City
(RTC) convicted Delos Santos as charged.
ISSUE: Whether or not the accused must be acquitted based on hearsay and failure to establish animus
possidendi

RULING: No
Firstly, Delos Santos objects to the testimonies of NBI agent Esmeralda and building security
supervisor Zabat on the discovery of the shabu as hearsay. He asserts that the State consequently had no
evidence with which to establish his guilt beyond reasonable doubt in view of the failure to present the
apprehending security guard as a witness against him.
The objection deserves no consideration. To begin with, Delos Santos waived the objection on the
discovery of the shabu as hearsay by not raising it during the trial. Equally significant in this regard is that he
expressly admitted during the trial his actual possession of the box containing the shabu. His admission thereby
rendered the testimony of the security guard unnecessary and superfluous. Moreover, it is erroneous for him to
treat the testimonies of NBI agent Esmeralda and building security supervisor Zabat as hearsay as to his
possession of the shabu. They were actually eyewitnesses as far as the physical turn-over of the shabu seized
from Delos Santos was concerned. That physical turn-over directly linked Delos Santos to the shabu presented
and admitted as evidence at the trial. As such, the turn-over constituted strong evidence of the possession of
the shabu by Delos Santos.
In a prosecution for possession of illegal substances, proof of animus possidendi on the part of the
accused is indispensable. But animus possidendi is a state of mind, and is thus to be determined on a case-to-
case basis by taking into consideration the prior and contemporaneous acts of the accused, as well as the
surrounding circumstances. It may and must be inferred usually from the attendant events in each particular
case. Upon the States presenting to the trial court of the facts and circumstances from which to infer the
existence of animus possidendi, it becomes incumbent upon the Defense to rebut the inference with evidence
that the accused did not exercise power and control of the illicit thing in question, and did not intend to do so.
For that purpose, a mere unfounded assertion of the accused that he did not know that he had possession of the
illegal drug is insufficient, and animus possidendi is then presumed to exist on his part because he was thereby
shown to have performed an act that the law prohibited and punished. It cannot be disputed that Delos Santos
had animus possidendi. His conduct prior to and following his apprehension evinced his guilty knowledge of
the contents of the gift-wrapped box as shabu. His uncorroborated story of having been summoned to help in
the cleaning of Unit 706 was a sham excuse that he peddled to explain his presence in the Somerset
Condominium.

People of the Philippines vs. Darwin Relato

G.R. No. 173794, January 18, 2012
BERSAMIN, J.:
Statutory rules on preserving the chain of custody of confiscated prohibited drugs and related items are
designed to ensure the integrity and reliability of the evidence to be presented against the accused. Their
observance is the key to the successful prosecution of illegal possession or illegal sale of prohibited drugs.
FACTS:
PO3 Sonny Evasco of the Bulan Police Station received a tip from his asset to the effect that Relato
would be peddling illegal drugs around midnight in Barangay Aquino, Zone 7, Bulan, Sorsogon. SPO1 Masujer
formed a team to conduct a buy-bust operation against Relato. SPO1 Masujer prepared a P500.00 bill to be the
buy-bust money by marking the bill with his initials. Relato and a companion (later identified as Pido Paredes)
arrived together on board a motorcycle. Relato alighted to confer with the asset who was the poseur buyer.
After the transaction was completed, PO3 Evasco signaled to the rest of the team, who drew near and
apprehended Relato. Seized from Relato was the marked P500.00 buy-bust bill. The poseur buyer turned over
to PO3 Evasco the two transparent sachets containing crystalline substances that Relato sold to the poseur
buyer. Paredes escaped.

SPO1 Masujer marked the two transparent sachets with his own initials EM upon returning to the
police station. Forensic Chemical Officer Josephine Clemen of the PNP Crime Laboratory in Region V
certified that the contents were positive for the presence of methamphetamine hydrochloride. RTC convicted
Relato for violating Section 5 of Republic Act No. 9165 (Comprehensive Dangerous Drugs Act of 2002). CA
affirmed the conviction.

ISSUE: Whether or not CA erred in not acquitting the accused

RULING: Yes
Section 21 of Republic Act No. 9165 provides the procedure to be followed in the seizure and custody
of prohibited drugs. A review of the records establishes that the aforestated procedure laid down by Republic
Act No. 9165 and its IRR was not followed. Several lapses on the part of the buy-bust team are readily
apparent. To start with, no photograph of the seized shabu was taken. Secondly, the buy-bust team did not
immediately mark the seized shabu at the scene of the crime and in the presence of Relato and witnesses.
Thirdly, although there was testimony about the marking of the seized items being made at the police station,
the records do not show that the marking was done in the presence of Relato or his chosen representative. And,
fourthly, no representative of the media and the Department of Justice, or any elected official attended the
taking of the physical inventory and to sign the inventory.

Under the foregoing rules, the marking immediately after seizure is the starting point in the custodial
link, because succeeding handlers of the prohibited drugs or related items will use the markings as reference. It
further serves to segregate the marked evidence from the corpus of all other similar and related evidence from
the time they are seized from the accused until they are disposed of at the end of the criminal proceedings,
obviating switching, planting, or contamination of evidence.It is crucial in ensuring the integrity of the chain
of custody, which is defined in Section 1(b) of Dangerous Drugs Board Regulation No. 1, Series of 2002.
While the last paragraph of Section 21(a) of the IRR provides a saving mechanism to ensure that not
every case of non-compliance irreversibly prejudices the States evidence, it is significant to note that the
application of the saving mechanism to a situation is expressly conditioned upon the State rendering an
explanation of the lapse or lapses in the compliance with the procedures. Here, however, the Prosecution
tendered no explanation why the buy-bust team had failed to mark the seized shabu immediately after the
arrest. Nevertheless, even assuming that marking the shabu at the scene of the crime by the buy-bust team had
not been practical or possible for the buy-bust team to do, the saving mechanism would still not be applicable
due to the lack of a credible showing of any effort undertaken by the buy-bust team to keep the shabu intact
while in transit to the police station.

The procedural lapses committed by the buy-bust team underscored the uncertainty about the identity
and integrity of the shabu admitted as evidence against the accused. In a prosecution of the sale and possession
of methamphetamine hydrochloride prohibited under Republic Act No. 9165, the State not only carries the
heavy burden of proving the elements of the offense of, but also bears the obligation to prove the corpus delicti,
failing in which the State will not discharge its basic duty of proving the guilt of the accused beyond reasonable
doubt. It is settled that the State does not establish the corpus delicti when the prohibited substance subject of
the prosecution is missing or when substantial gaps in the chain of custody of the prohibited substance raise
grave doubts about the authenticity of the prohibited substance presented as evidence in court. Any gap renders
the case for the State less than complete in terms of proving the guilt of the accused beyond reasonable
doubt. Thus, Relato deserves exculpation, especially as we recall that his defense of frame-up became plausible
in the face of the weakness of the Prosecutions evidence of guilt.

People of the Philippines vs. PO2 Eduardo Valdez and Edwin Valdez
G.R. No. 175602, January 18, 2012
BERSAMIN, J.:
The sufficiency of the allegations of the facts and circumstances constituting the elements of the crime charged
is crucial in every criminal prosecution because of the ever-present obligation of the State to duly inform the
accused of the nature and cause of the accusation.
FACTS:
Heidi dela Cruz (a barbecue vendor) and Noel Valad-on (a tricycle driver) saw accused Edwin Valdez alight
from a bus. The latter bought P100.00 worth of barbecue from Heidi then proceeded towards home. He was
walking along Corregidor Street when Heidi saw Jun Sayson (Moises), then holding a gun, block his (Edwins)
way. Jun Sayson poked a gun at accused Edwin, shouting, Putang-ina mo, papatayin kita. The latter raised
both his hands and said Wag kuya Jun, maawa ka. Accused Eduardo Valdez (a policeman), then carrying his
6-year old child, was walking when his way was likewise blocked but this time, by the siblings Joselito and
Ferdinand as well as their stepfather. Joselito twisted one of his (Eduardos) hands at his back while his
(Joseltios) stepfather held the other. Ferdinand fired a gun but accused Eduardo was able to evade. Joselito,
who was positioned behind Eduardo, was hit. He slumped and bled. He asked Heidi to inform his family that he
was hit. Heidi ran away. She saw Jun (Moises) and accused Edwin grappling. Thereafter, she heard gunshots.

Accused Eduardo ducked during the firing. He pretended to be dead. Ferdinand stopped firing.
Accused Eduardos son approached him crying. Accused thereafter, brought his son home, took his service
firearm and on his way back to the scene of the incident when he met General Jesus Almadin, his commanding
officer (CO). He reported the incident and sought for advice. He was told to take a rest and go back the
following day. He accompanied his CO to Camp Crame. He surrendered his firearm to Sr./Insp. Rodolfo Araza
of the CIU. Accused Edwin Valdez likewise surrendered. RTC convicted the two accused of three counts of
murder and sentenced them to suffer reclusion perpetua for each count of murder. On appeal, the CA affirmed
the convictions.

ISSUE: Whether or not the States witness is credible and whether or not there is conspiracy

RULING: Yes
The trial court was in the best position to assess the credibility of witnesses by virtue of its first-hand
observation of the demeanor, conduct and attitude of the witnesses under grilling examination. The only time
when a reviewing court was not bound by the trial courts assessment of credibility arises upon a showing of a
fact or circumstance of weight and influence that was overlooked and, if considered, could affect the outcome
of the case. No such fact or circumstance has been brought to the Courts attention.
It is not trite to remind that a truth-telling witness is not always expected to give an error-free testimony
because of the lapse of time and the treachery of human memory; and that inaccuracies noted in testimony may
even suggest that the witness is telling the truth and has not been rehearsed. To properly appreciate the worth of
testimony, therefore, the courts do not resort to the individual words or phrases alone but seek out the whole
impression or effect of what has been said and done.
The testimonial accounts of the States witnesses entirely jibed with the physical evidence. Also, Dr.
Wilfredo Tierra of the NBI Medico-Legal Office opined that the presence of marginal abrasions at the points of
entry indicated that the gunshot wounds were inflicted at close range. Given that physical evidence was of the
highest order and spoke the truth more eloquently than all witnesses put together, the congruence between the
testimonial recollections and the physical evidence rendered the findings adverse to PO2 Valdez and Edwin
conclusive.
Conspiracy exists when two or more persons come to an agreement concerning the commission of a
felony and decide to commit the felony. Proof of the actual agreement to commit the crime need not be direct
because conspiracy may be implied or inferred from their acts. Herein, both lower courts deduced the
conspiracy between the accused from the mode and manner in which they perpetrated the killings. We are
satisfied that their deduction was warranted. To be a conspirator, one did not have to participate in every detail
of the execution; neither did he have to know the exact part performed by his co-conspirator in the execution of
the criminal acts.

Treachery is the employment of means, methods, or forms in the execution of any of the crimes against
persons which tend to directly and specially insure its execution, without risk to the offending party arising
from the defense which the offended party might make. It encompasses a wide variety of actions and attendant
circumstances, the appreciation of which is particular to a crime committed. Corollarily, the defense against the
appreciation of a circumstance as aggravating or qualifying is also varied and dependent on each particular
instance. Such variety generates the actual need for the State to specifically aver the factual circumstances or
particular acts that constitute the criminal conduct or that qualify or aggravate the liability for the crime in the
interest of affording the accused sufficient notice to defend himself.
 It cannot be otherwise, for, indeed, the real nature of the criminal charge is determined not from the
caption or preamble of the information, or from the specification of the provision of law alleged to have been
violated, which are mere conclusions of law, but by the actual recital of the facts in the complaint or
information. To discharge its burden of informing him of the charge, the State must specify in the information
the details of the crime and any circumstance that aggravates his liability for the crime. The requirement of
sufficient factual averments is meant to inform the accused of the nature and cause of the charge against him in
order to enable him to prepare his defense. It emanates from the presumption of innocence in his favor,
pursuant to which he is always presumed to have no independent knowledge of the details of the crime he is
being charged with. To have the facts stated in the body of the information determine the crime of which he
stands charged and for which he must be tried thoroughly accords with common sense and with the
requirements of plain justice.
The allegations in the information are controlling in the ultimate analysis. Thus, when there is a
variance between the offense charged in the information and that proved, and the offense as charged is included
in or necessarily includes the offense proved, the accused shall be convicted of the offense proved included in
the offense charged, or of the offense charged included in the offense proved. In that regard, an offense charged
necessarily includes the offense proved when some of the essential elements or ingredients of the former, as
alleged in the information, constitute the latter; an offense charged is necessarily included in the offense proved
when the essential ingredients of the former constitute or form part of those constituting the latter.

People of the Philippines vs. Cesar Bautista

G.R. No. 177320, February 22, 2012
BERSAMIN, J.:
To secure a conviction for illegal sale of shabu, the following essential elements must be established: (a) the
identities of the buyer and the seller, the object of the sale, and the consideration; and (b) the delivery of the
thing sold and the payment for the thing. What is material in prosecutions for illegal sale of shabu is the proof
that the transaction or sale actually took place, coupled with the presentation in court of the corpus delicti as
evidence.
FACTS:
An informant went to the Station Drug Enforcement Unit of the Caloocan Police Station to report the
peddling of illegal drugs by Bautista on Kasama Street, Barangay 28, Caloocan City. Police Insp. Cesar Cruz
formed a team to conduct a buy-bust operation against Bautista. PO2 Tayag, designated as the poseur-buyer,
was given a P100.00 bill as buy-bust money, on which he placed his initials ALT. The informant pointed out
Bautista to the team. Bautista was then standing in front of a house. PO2 Tayag and the informant then
approached Bautista even as the rest of the team took up positions nearby. The informant introduced PO2
Tayag to Bautista as biyahero ng shabu, after which the informant left PO2 Tayag and Bautista alone to
themselves. PO2 Tayag told Bautista: Cesar, pakuha ng piso. Bautista drew a plastic sachet from his pocket
and handed it to PO2 Tayag, who in turn handed the P100.00 bill buy-bust money to Bautista. PO2 Tayag then
turned his cap backwards as the pre-arranged signal to the back-up members. The latter rushed forward and
arrested Bautista. The Office of the City Prosecutor of Caloocan City filed in the RTC two separate
informations charging Cesar Bautista y Santos with a violation of Section 5 and a violation of Section 11 (3) of
RA 9165. RTC found Bautista guilty as charged. CA affirmed the RTC judgment.

ISSUE: Whether or not CA erred in affirming his conviction because: (a) there were inconsistencies in the
testimonies of Prosecution witnesses as to who of them had actually received the tip from the informant; (b)
PO2 Tayags testimony that Bautista had handed him a sachet of shabu without inquiring about the formers
identity ran counter to human experience; (c) the back-up members of the buy-bust team did not actually
witness the transaction between PO2 Tayag and Bautista; and (d) the plastic sachets were not immediately
marked after their seizure from Bautista

RULING:
Illegal sale and illegal possession of shabu were established beyond reasonable doubt
To secure a conviction for illegal sale of shabu, the following essential elements must be established: (a) the
identities of the buyer and the seller, the object of the sale, and the consideration; and (b) the delivery of the
thing sold and the payment for the thing. What is material in prosecutions for illegal sale of shabu is the proof
that the transaction or sale actually took place, coupled with the presentation in court of the corpus delicti as
evidence. The requisites for illegal sale of shabu were competently and convincingly proven by the
Prosecution. PO2 Tayag, as the poseur-buyer, attested that Bautista sold shabu to him during a legitimate buy-
bust operation.
For illegal possession of a dangerous drug, like shabu, the elements are: (a) the accused is in possession of an
item or object that is identified to be a prohibited or dangerous drug; (b) such possession is not authorized by
law; and (c) the accused freely and consciously possessed the drug. The elements of illegal possession of a
dangerous drug were similarly competently and convincingly established by the Prosecution. SPO1 Ybaez
stated that upon seeing the pre-arranged signal given by PO2 Tayag, he and the other members of the team
proceeded to arrest Bautista; and that he frisked Bautista and then recovered six other plastic sachets from
Bautistas pocket.
The lower courts justifiably accorded credence to the eyewitness testimonies of PO2 Tayag, PO2 Caragdag,
and SPO1 Ybaez. Their testimonial accounts were consistent with the documentary and object evidence of the
Prosecution. It was significant that no ill motive was imputed to them to falsely testify against Bautista, with
Bautista himself admitting not being aware of any reason why they would wrongly incriminate him.
In drug-related prosecutions, the State bears the burden not only of proving the elements of the offenses of sale
and possession of shabu under Republic Act No. 9165, but also of proving the corpus delicti, the body of the
crime. The dangerous drug is itself the very corpus delicti of the violation of the law prohibiting the possession
of the dangerous drug. The rule on chain of custody under Section 21 of Republic Act No. 9165 expressly
demands the identification of the persons who handle the confiscated items for the purpose of duly monitoring
the authorized movements of the illegal drugs and/or drug paraphernalia from the time they are seized from the
accused until the time they are presented in court.
Here, the buy-bust team did not mark the sachets until after reaching the police station. Even so, the
omission did not destroy the integrity and the evidentiary value of the confiscated items. We are satisfied
that PO2 Tayag and SPO1 Ybaez brought the confiscated sachets of shabu to the police station
immediately after the buy-bust operation, and turned them over to the duty investigator, PO2 Castillo, for
marking; that in their presence, PO2 Castillo marked the sachet of shabu sold by Bautista to PO2 Tayag as
CBS (Bautistas initials) Buy-bust, and the six sachets of shabu recovered by SPO1 Ybaez from Bautistas
possession as CBS-1, CBS-2, CBS-3, CBS-4, CBS-5, and CBS-6; that PO2 Castillo then delivered the marked
sachets to Insp. Cruz who in turn caused their transmittal to the Crime Laboratory Office, Northern Police
District (NPD), in Caloocan City, for appropriate laboratory examination; that upon the instruction of Insp.
Cruz, SPO1 Ybaez hand-carried the written request and the marked sachets to the NPD Crime Laboratory
Office for laboratory examination, where one PO2 Bonifacio received them; and that thereafter, Forensic
Chemist Arturo certified in the Physical Science Report prepared following his qualitative examination that the
contents of the marked sachets were positive for methamphetamine hydrochloride or shabu.
We have held that a non-compliance with the regulations is not necessarily fatal as to render an accuseds arrest
illegal or the items confiscated from him inadmissible as evidence of his guilt, for what is of the utmost
importance is the preservation of the integrity and the evidentiary value of the confiscated items that will be
utilized in the determination of his guilt or innocence.

Denial and frame-up not established

Bautistas denial and defense of frame-up were given no consideration due to their being self-serving and
uncorroborated. He did not present Rosario, his wife, to corroborate his claim of being framed up although she
was supposed to have been around at the time of his arrest. He did not also adduce evidence to substantiate his
story of being falsely incriminated in a frame-up by competent evidence. His claim thereon did not prevail over
the positive identification of him by PO2 Tayag as the drug pusher he had transacted with.

Inconsistencies in testimony are inconsequential

There is no dispute that the matter of who among the policemen actually received the report from the informant
did not relate to the essential elements of the crimes charged. Nor did such matter refer to the actual buy-bust
itself that crucial moment when Bautista was caught red-handed selling and possessing shabu in question. An
inconsistency that had nothing to do with the elements of the crime could not be a basis for acquittal.
People of the Philippines vs. Erland Sabadlab
G.R. No. 175924, March 14, 2012
BERSAMIN, J.:
FACTS:
AAA was then walking at around noon of March 12, 2002 on Dapitan Street in Makati City,
proceeding towards MA Montessori to fetch her employers son who was studying there. Suddenly, a man
(later identified as Sabadlab) grabbed her by the shoulder and ordered her to go with him. She recognized him
to be the man who had persistently greeted her every time she had bought pandesal at 5 oclock am near her
employers house in the past two weeks. Alarmed, she refused to do his bidding, but Sabadlab poked a gun at
her throat. Two other men whom she did not recognize joined Sabadlab at that point. They forced her into the
backseat of a parked car, and one of Sabadlabs cohorts blindfolded her with a handkerchief. The car moved
forward, and stopped after twenty minutes of travel. Still blindfolded, she was brought out of the car.
Sabadlab said that he would remove her clothes. Sabadlab then undressed her, leaving only the blindfold on
her. One of them tied her hands behind her back. Sabadlab began kissing her body from the neck downwards.
Although blindfolded, she knew that it was Sabadlab because his cohorts were calling out his name as he was
kissing her body. Then they made her lie flat on the ground with her hands still tied behind her back.
Sabadlab raped her in that position. The others took their turns in raping her after Sabadlab. To prevent her
from shouting for help, Sabadlab stuffed her mouth with crumpled newspapers. The three ravished her again
and again, that she could not remember the number of times they did so.
At around 3:00 oclock pm, Sabadlab and his cohorts returned a blindfolded AAA by car back to
Dapitan Street, but let her go only after sternly warning that they would surely kill her if she told anyone about
the rapes. Once they left, she proceeded to MA Montessori to fetch her ward. Upon her arrival at the house,
AAAs employer noticed the kiss marks on her neck. AAA at first lied about the kiss marks, but she ultimately
disclosed the rapes because her irritated employer slapped and boxed her on the stomach to force her to
disclose. Her employer brought AAA to the Makati Police Station to report the rapes. The policemen
apprehended Sabadlab and brought him to the station, where he gave his name as Erland Sabadlab y Bayquel.
These antecedents impelled the Office of the City Prosecutor of Makati to immediately charge Sabadlab and
two John Does with forcible abduction with rape. RTC convicted Sabadlab for forcible abduction with rape.

ISSUE: Whether or not the conviction is correct

RULING: Yes
Because both the RTC and the CA unanimously regarded AAA as a credible and spontaneous witness,
he has now to present clear and persuasive reasons to convince us to reverse both lower courts determination of
credibility and to resolve the appeal his way. Sabadlab has not tendered any clear and persuasive reasons that
may warrant the reversal or modification of the findings of both lower courts on the credibility of AAA and his
criminal liability. The supposed inconsistencies dwelled on minor details or collateral matters that the CA
precisely held to be badges of veracity and manifestations of truthfulness due to their tendency of
demonstrating that the testimony had not been rehearsed or concocted. It is also basic that inconsistencies
bearing on minor details or collateral matters should not adversely affect the substance of the witness
declaration, veracity, or weight of testimony. The only inconsistencies that might have discredited the victims
credible testimony were those that affected or related to the elements of the crime. Alas, that was not true
herein. witnesses and of weighing their credibility is best left to the trial judge by virtue of the first-hand
impressions he derives while the witnesses testify before him.
AAAs recollection of the principal occurrence and her positive identification of the rapists,
particularly Sabadlab, were firm. It is reassuring, too, that her trustworthiness in identifying Sabadlab as one of
the rapists rested on her recognition of him as the man who had frequently flirted with her at the store where
she had usually bought pandesal for her employers table. As such, the identification of him as one of the rapists
became impervious to doubt.
AAAs failure to shout for help and her failure to escape were not factors that should diminish
credibility due to their being plausibly explained, the first by the fact that her mouth had been stuffed by
Sabadlab with crumpled newspaper, preventing her from making any outcry, and the second by the fact that the
culprits had blindfolded her and had also tied her hands behind her back.
 Sabadlabs allegation that AAA did not sustain any bodily injuries was actually contrary to the medical
certification showing her several physical injuries and the penetration of her female organ. This should debunk
without difficulty his submission that she did not offer any resistance to the sexual assaults she suffered. Her
resistance to Sabadlabs order for her to go with him was immediately stifled by his poking of the gun at her
throat and by appearance of his two cohorts.
We next deal with the characterization of the crime as forcible abduction with rape. The principal
objective of Sabadlab and his two cohorts in abducting AAA from Dapitan Street and in bringing her to another
place was to rape and ravish her. This objective became evident from the successive acts of
Sabadlab immediately after she had alighted from the car in completely undressing her as to expose her whole
body (except the eyes due to the blindfold), in kissing her body from the neck down, and in having
carnal knowledge of her (in that order). Although forcible abduction was seemingly committed, we cannot hold
him guilty of the complex crime of forcible abduction with rape when the objective of the abduction was to
commit the rape. Under the circumstances, the rape absorbed the forcible abduction.

People of the Philippines vs. Julius Taguilid

G.R. No. 181544, April 11, 2012
BERSAMIN, J.
FACTS:
Taguilid was charged in the RTC with rape in relation to Republic Act No. 7610 (Special Protection of
Children against Child Abuse, Exploitation and Discrimination Act). Taguilid suddenly entered AAAs room
while she was resting; that he was a cousin of her mother who had been living with her family in that house
since 2000; that upon entering her room, he pushed her down on her back, then inserted his finger in her vagina
and later on inserted his penis in her vagina; that he next turned her over and penetrated her anus with his penis
while in that position; and that she did not shout for help because he threatened to kill her if she did. At the time
of the rape, AAA was 12 years and ten months old. RTC convicted the accused which was affirmed by CA.

ISSUE: Whether or not the trial court erred in convicting the accused?

RULING: No
First of all, it is basic that findings of the CA affirming those of the RTC as the trial court are generally
conclusive on the Court which is not a trier of facts. With Taguilid not showing that the RTC and the CA
overlooked any fact or material of consequence that could have altered the outcome if they had taken it into due
consideration, the Court must fully accept the findings of the CA. Secondly, the medico-legal finding showing
AAAs hymenal laceration as deep-healed and as having healed 5 to 10 days from the time of (infliction of) the
injury did not detract from the commission of the rape on May 29, 2002. For one, hymenal injury has never
been an element of rape, for a female might still be raped without such injury resulting. The essence of rape is
carnal knowledge of a female either against her will (through force or intimidation) or without her
consent (where the female is deprived of reason or otherwise unconscious, or is under 12 years of age, or is
demented).

Thirdly, AAAs failure to shout for help although she knew that her father was tending to the family
store just downstairs was not a factor to discredit her or to diminish the credibility of her evidence on the rape.
She explained her failure by stating that Taguilid had threatened to harm her should she shout. She thereby
commanded credence, considering that she was not expected to easily overcome her fear of him due to her
being then a minor just under 13 years of age at the time of the rape. Indeed, the workings of the human mind
placed under emotional stress are unpredictable, and people react differently - some may shout, others may
faint, and still others may be shocked into insensibility even if there may be a few who may openly welcome
the intrusion. There can be no question that the testimony of a child who has been a victim in rape is normally
given full weight and credence. Judicial experience has enabled the courts to accept the verity that when a
minor says that she was raped, she says in effect all that is necessary to show that rape was committed against
her.
And, fourthly, Taguilids defense at the trial was plain denial of the positive assertions made against
him. He then declared that the charge of rape against him resulted from BBBs misunderstanding of what had
really occurred in AAAs bedroom just before BBB had appeared unannounced. Yet, such denial was devoid of
persuasion due to its being easily and conveniently resorted to, and due to denial being generally weaker than
and not prevailing over the positive assertions of both AAA and BBB.

People of the Philippines vs. Edmundo Villaflores

G.R. No. 184926, April 11, 2012
BERSAMIN, J.:
Circumstantial evidence is admissible as proof to establish both the commission of a crime and the identity of
the culprit.
FACTS:
The victim was Marita, a girl who was only four years and eight months old when her very young life
was snuffed out by strangulation. She had been playing at the rear of their residence in Bagong
Silang, Caloocan City when Julia, her mother, first noticed her missing from home. At 6 am of the next day,
Manito reported to the police that Marita was missing. They found Maritas lifeless body covered with a blue
and yellow sack inside the comfort room of an abandoned house about five structures away from their own
house. She had been tortured and strangled till death. The ensuing police investigation led to two witnesses,
Aldrin Bautista and Jovy Solidum, who indicated that Villaflores might be the culprit who had raped and killed
Marita. City Prosecutor of Caloocan City filed in the RTC the information charging Villaflores with rape with
homicide. RTC convicted Villaflores of rape with homicide, holding that the circumstantial evidence led to no
other conclusion but that his guilt was shown beyond reasonable doubt.

ISSUE: Whether or not RTC and the CA gravely erred in finding him guilty beyond reasonable doubt of rape
with homicide because the State did not discharge its burden to prove beyond reasonable doubt every fact and
circumstance constituting the crime charged.

RULING: No
Nature of rape with homicide as a composite crime, explained
The felony of rape with homicide is a composite crime. A composite crime, also known as a special complex
crime, is composed of two or more crimes that the law treats as a single indivisible and unique offense for being
the product of a single criminal impulse. It is a specific crime with a specific penalty provided by law, and
differs from a compound or complex crime under Article 48 of the Revised Penal Code.
There are distinctions between a composite crime, on the one hand, and a complex or compound crime
under Article 48, supra, on the other hand. In a composite crime, the composition of the offenses is fixed by
law; in a complex or compound crime, the combination of the offenses is not specified but generalized, that is,
grave and/or less grave, or one offense being the necessary means to commit the other. For a composite crime,
the penalty for the specified combination of crimes is specific; for a complex or compound crime, the penalty is
that corresponding to the most serious offense, to be imposed in the maximum period. A light felony that
accompanies a composite crime is absorbed; a light felony that accompanies the commission of a complex or
compound crime may be the subject of a separate information.
The law on rape defines and sets forth the composite crimes of attempted rape with homicide and rape
with homicide. In both composite crimes, the homicide is committed by reason or on the occasion of rape. As
can be noted, each of said composite crimes is punished with a single penalty, the former with reclusion
perpetua to death, and the latter with death. The phrases by reason of the rape and on the occasion of the
rape are crucial in determining whether the crime is a composite crime or a complex or compound crime. The
phrase by reason of the rape obviously conveys the notion that the killing is due to the rape, the offense the
offender originally designed to commit. The victim of the rape is also the victim of the killing. The
indivisibility of the homicide and the rape (attempted or consummated) is clear and admits of no doubt.

The State discharged its burden of proving the rape with homicide beyond reasonable doubt
Under Article 266-A, rape is always committed when the accused has carnal knowledge of a female under 12
years of age. The crime is commonly called statutory rape, because a female of that age is deemed incapable of
giving consent to the carnal knowledge. Maritas Certificate of Live Birth disclosed that she was born
on October 29, 1994, indicating her age to be only four years and eight months at the time of the commission of
the crime.
We have often conceded the difficulty of proving the commission of rape when only the victim is left to testify
on the circumstances of its commission. The difficulty heightens and complicates when the crime is rape with
homicide, because there may usually be no living witnesses if the rape victim is herself killed. Yet, the situation
is not always hopeless for the State, for the Rules of Court also allows circumstantial evidence to establish the
commission of the crime as well as the identity of the culprit.
Firstly, Aldrin Bautista and Jovie Solidum saw Villaflores holding Marita by the hand at around 10:00
am on July 2, 1999, leading the child through the alley going towards the direction of his house about 6 houses
away from the victims house.Secondly, Marita went missing after that and remained missing until the discovery
of her lifeless body on the following day. Thirdly, Solidum passed by Villaflores house at about 3:00
pm of July 2, 1999 and heard the crying and moaning (umuungol) of a child coming from inside. Fourthly, at
about 7:00 pm of July 2, 1999 Solidum saw Villaflores coming from his house carrying a yellow sack that
appeared to be heavy and going towards the abandoned house where the childs lifeless body was later found.
Fifthly, Manito, the father of Marita, identified the yellow sack as the same yellow sack that covered the head
of his daughter (nakapalupot sa ulo) at the time he discovered her body; Manito also mentioned that a blue sack
covered her body. Sixthly, a hidden pathway existed between the abandoned house where Maritas body was
found and Villaflores house, because his house had a rear exit that enabled access to the abandoned house
without having to pass any other houses. This indicated Villaflores familiarity and access to the abandoned
house. Seventhly, several pieces of evidence recovered from the abandoned house, like the white rope around
the victims neck and the yellow sack, were traced to Villaflores. The white rope was the same rope tied to the
door of his house, and the yellow sack was a wall-covering for his toilet. Eighthly, the medico-legal findings
showed that Marita had died from asphyxiation by strangulation. Ninthly, Marita sustained multiple deep fresh
hymenal lacerations, and had fresh blood from her genitalia. And, tenthly, the body of Marita was already in the
second stage of flaccidity at the time of the autopsy of her cadaver. The medico-legal findings indicated that
such stage of flaccidity confirmed that she had been dead for more than 24 hours, or at the latest by 9
pm of July 2, 1999. These circumstances were links in an unbroken chain whose totality has brought to us a
moral certainty of the guilt of Villaflores for rape with homicide.

Rogelio Reyes vs. Court of Appeals

G. R. No. 180177, April 18, 2012
BERSAMIN, J:
The burden rests in the Prosecution to see to it that the evidence of guilt satisfies the standard of moral
certainty demanded in all criminal prosecutions. The standard demands that all the essential elements of the
offense are established as to leave no room for any doubt about the guilt of the accused. The courts should
unfailingly impose the standard in order to prevent injustice from being perpetrated against the accused.
FACTS:
Office of the City Prosecutor of Manila filed two informations charging petitioner with illegal sale of shabu and
illegal possession of shabudefined and punished, respectively, by Sections 5 and 11 of R.A. No. 9165. From
the police station, the lady confidential informant called petitioner by phone. The latter instructed her to wait
on M. Mapa Street. Thus, the buy-bust team proceeded to that area. Petitioner came by five minutes later, and,
after asking the lady confidential informant whether PO2 Payumo was the buyer, instructed Payumo to follow
him to his house where he told PO2 Payumo to wait. Petitioner asked PO2 Payumo for the payment, and the
latter complied and handed the marked money consisting of three P50.00 bills all bearing the initials
TF. Petitioner then went into a room and returned with a plastic sachet containing white crystalline substance
that he gave to PO2 Payumo. Receiving the plastic sachet, PO2 Payumo placed a missed call to PO1 Miguelito
Gil, a member of the buy-bust team, thereby giving the pre-arranged signal showing that the transaction was
completed.

ISSUE: Whether or not the accused should be acquitted

RULING: Yes
In this jurisdiction, we convict the accused only when his guilt is established beyond reasonable doubt.
Conformably with this standard, we are mandated as an appellate court to sift the records and search for every
error, though unassigned in the appeal, in order to ensure that the conviction is warranted, and to correct every
error that the lower court has committed in finding guilt against the accused.
The procedural safeguards start with the requirements prescribed by Section 21 of R.A. No. 9165
relating to the custody and disposition of the confiscated, seized, and surrendered dangerous drugs, plant
sources of the dangerous drugs, controlled precursors and essential chemicals, instruments and paraphernalia,
and laboratory equipment. The successful prosecution of illegal sale of dangerous drugs requires: (a) proof that
the transaction or sale took place, and (b) the presentation in court as evidence of the corpus delicti, or the
dangerous drugs themselves. On the other hand, the prosecution of illegal possession of dangerous drugs
necessitates the following facts to be proved, namely: (a) the accused was in possession of dangerous drugs, (b)
such possession was not authorized by law, and (c) the accused was freely and consciously aware of being in
possession of dangerous drugs. For both offenses, it is crucial that the Prosecution establishes the identity of the
seized dangerous drugs in a way that the integrity thereof has been well preserved from the time of seizure or
confiscation from the accused until the time of presentation as evidence in court. Nothing less than a faithful
compliance with this duty is demanded of all law enforcers arresting drug pushers and drug possessors and
confiscating and seizing the dangerous drugs and substances from them. This duty of seeing to the integrity of
the dangerous drugs and substances is discharged only when the arresting law enforcer ensures that the chain of
custody is unbroken.
Here, the Prosecution failed to demonstrate a faithful compliance by the arresting lawmen of the rule
on chain of custody. To start with, the fact that the dangerous drugs were inventoried and photographed at the
site of arrest upon seizure in the presence of petitioner, a representative of the media, a representative of the
Department of Justice (DOJ), and any elected public official, was not shown. Instead, the records show that
PO2 Payumo placed the markings of RRS-1 on the sachet allegedly received from petitioner and RRS-2 on the
two sachets allegedly seized from petitioners hand already at the police station with only petitioner present.
Yet, the Prosecution did not also present any witness to establish that an inventory of the seized articles at least
signed by petitioner at that point was prepared.

We clarified in People v. Sanchez that in compliance with Section 21 of R.A. No. 9165, supra, the
physical inventory and photographing of the seized articles should be conducted, if practicable, at the place of
seizure or confiscation in cases of warrantless seizure. But that was true only if there were indications that
petitioner tried to escape or resisted arrest, which might provide the reason why the arresting team was not able
to do the inventory or photographing at petitioners house; otherwise, the physical inventory and photographing
must always be immediately executed at the place of seizure or confiscation. However, the omissions noted
herein indicated that the State did not establish the identity of the dangerous drugs allegedly seized from
petitioner with the same exacting certitude required for a finding of guilt.

To be sure, the buy-bust operation was infected by lapses. Although PO2 Payumo declared that he was
the one who had received the sachet of shabu (RRS-1) from petitioner and who had confiscated the two sachets
of shabu (RRS-2) from petitioner, all of which he had then sealed, nothing more to support the fact that the
evidence thus seized had remained intact was adduced. In fact, the State did not anymore establish to whom the
seized articles had been endorsed after PO2 Payumo had placed the markings at the station, and with whose
custody or safekeeping the seized articles had remained until their endorsement to P/Insp. Macapagal for the
laboratory examination. Also, the Prosecution did not show to whom the seized articles had been turned over
following the conduct of the laboratory examination, and how the seized articles had been kept in a manner that
preserved their integrity until their final presentation in court as evidence of the corpus delicti. Such lapses of
the Prosecution were fatal to its proof of guilt because they demonstrated that the chain of custody did not stay
unbroken, thereby raising doubt on the integrity and identity of the dangerous drugs as evidence of the corpus
delicti of the crimes charged.

Firstly, PO2 Payumo testified that the lady confidential informant had gone to Police Station 8 to report
the alleged drug-selling activities of petitioner for the first time in the morning of January 20, 2005. That report
[45]
led to the forming of the buy-bust team, for purposes of which he prepared the pre-operation documents. His
veracity was suspect, however, considering that his so-called Pre-Operation/Coordination Sheet appeared to
have been prepared on the day before, as its date January 19, 2005 disclosed. Secondly, the Pre-
Operation/Coordination Sheet indicated that there were ten members and three (3) others that comprised the
buy-bust team. Yet, the Joint Affidavit submitted by the members of the buy-bust team was executed and
signed by only six officers. And, thirdly, both the Pre-Operation/Coordination Sheet and the Certification of
Coordination revealed that the confidential information received involved two suspects of illegal drug trade in
Bacood, Sta. Mesa known as alias Boy and alias Totoy Tinga. PO2 Payumo recalled, however, that the lady
confidential informant had tipped the police off only about alias Boy.

Narciso Degaos vs. People of the Philippines

G.R. No. 162826, October 14, 2013
BERSAMIN, J.:
Novation is not a mode of extinguishing criminal liability under the penal laws of the country. Only the. State
may validly waive the criminal action against an accused. Novation rs relevant only to determine if the parties
have meanwhile altered the nature of the obligation prior ld the commencement of the criminal prosecution in
order to prevent the incipient criminal liability of the accused.
FACTS:
In an amended information dated March 23, 1994, the Office of the Provincial Prosecutor of Bulacan charged
Brigida D. Luz, alias Aida Luz, and Narciso Degafios in the Regional Trial Court in Malolos, Bulacan with
estafa under Article 315 paragraph 1 (b) of the Revised Penal Code. RTC found Degaos guilty as charged but
acquitted Luz for insufficiency of evidence, imposing on Degaos twenty years of reclusion temporal.
Petitioner assails the decision for not finding that novation had converted the liability of the accused into a civil
one.

ISSUE: Whether or not novation had converted the liability of the accused into a civil one.

RULING:
Novation did not transpire as to prevent the incipient criminal liability from arising
Degaos claim was again factually unwarranted and legally devoid of basis, because the partial payments he
made and his purported agreement to pay the remaining obligations did not equate to a novation of the original
contractual relationship of agency to one of sale. As we see it, he misunderstands the nature and the role of
novation in a criminal prosecution. Novation is the extinguishment of an obligation by the substitution or
change of the obligation by a subsequent one that terminates the first, either by (a) changing the object or
principal conditions; or (b) substituting the person of the debtor; or (c) subrogating a third person in the rights
of the creditor. In order that an obligation may be extinguished by another that substitutes the former, it is
imperative that the extinguishment be so declared in unequivocal terms, or that the old and the new obligations
be on every point incompatible with each other. Obviously, in case of only slight modifications, the old
obligation still prevails.
It may be observed in this regard that novation is not one of the means recognized by the Penal Code whereby
criminal liability can be extinguished; hence, the role of novation may only be to either prevent the rise of
criminal liability or to cast doubt on the true nature of the original basic transaction, whether or not it was such
that its breach would not give rise to penal responsibility, as when money loaned is made to appear as a deposit,
or other similar disguise is resorted to. Novation is not a ground under the law to extinguish criminal liability.
Article 89 (on total extinguishment) and Article 94 (on partial extinguishment) of the Revised Penal Code list
down the various grounds for the extinguishment of criminal liability. Not being included in the list, novation is
limited in its effect only to the civil aspect of the liability, and, for that reason, is not an efficient defense in
estafa. This is because only the State may validly waive the criminal action against an accused. The role of
novation may only be either to prevent the rise of criminal liability, or to cast doubt on the true nature of the
original basic transaction, whether or not it was such that the breach of the obligation would not give rise to
penal responsibility, as when money loaned is made to appear as a deposit, or other similar disguise is resorted
to.

People of the Philippines vs. Ramon Placer

G.R. No. 181753, October 9, 2013
BERSAMIN, J.:
In the absence of proof beyond reasonable doubt that treachery attended the killing of the victim, the crime is
homicide, not murder.
FACTS:
Office of the Provincial Prosecutor of Sorsogon charged Ramon and his brother Virgilio Placer with murder in
the Regional Trial Court (RTC) in Sorsogon City. Maria Gernale and her husband, Rosalino Gernale, were on
their way home to Brgy. Inararan, Bulan, Sorsogon on board a tricycle. They were in the company of Marias
father, another female passenger and five (5) young children. While their tricycle was moving, another tricycle
carrying appellants Ramon and Virgilio Placer almost hit them. Appellants and Rosalino alighted [from] their
respective tricycles and a heated altercation ensued between them. When things had subsided, Gernale and
appellants proceeded their separate ways. Sometime later, Maria realized that appellants were chasing them.
The latter were able to overtake the tricycle driven by Rosalino and later blocked its path. Appellants alighted
[from] their tricycle and proceeded towards the direction of Rosalino who had also alighted from his tricycle. A
confrontation followed and Angelina Gestiada, Rosalinos sister, tried to pacify appellants. But appellant
Ramon Placer did not heed as he stabbed Rosalino in the chest. Maria who was only about two (2) steps away
saw the incident. Rosalino fell towards the direction of his tricycle and just as he was about to fall, this time
Virgilio stabbed him in the stomach. Thereafter, appellants immediately fled the area on board their tricycle. It
was Virgilio who drove the tricycle.

ISSUE: Whether or not the crime committed was homicide, not murder

RULING:
By pleading self-defense, Ramon admitted the authorship of the killing of Rosalino Gernale. The consequence
of the plea of self-defense was to shift to Ramons shoulders the burden of evidence, that he must then prove
clearly and convincingly the following elements of self-defense, to wit: (1) unlawful aggression on the part of
the victim; (2) reasonable necessity of the means employed to prevent or repel the attack; and (3) lack of
sufficient provocation on the part of the person defending himself. Although the elements must concur, self-
defense must rest firstly on proof of the unlawful aggression on the part of the victim. There can be no self-
defense, whether complete or incomplete, if no unlawful aggression from the victim is established. In self-
defense, unlawful aggression is a primordial element, a condition sine qua non. If no unlawful aggression
attributable to the victim is established, self-defense is not a defense, because there would then be nothing to
repel on the part of the accused.
The near collision immediately led to a heated exchange of words between Rosalino and Virgilio, but they later
parted with each going his separate way. However, Virgilio soon after pursued Rosalinos tricycle and blocked
its path. Both Ramon and Virgilio quickly alighted from their tricycle to confront Rosalino, who also alighted
from his tricycle to protest. It was at that point when Ramon assaulted Rosalino by stabbing the latter in the
chest with his balisong, causing the latter to fall towards his own tricycle.

There is treachery when the offender commits any of the crimes against persons, employing means, methods or
forms in the execution thereof which tend directly and specially to insure its execution, without risk to himself
arising from the defense which the offended party might make. Treachery is not presumed but must be proved
as conclusively as the crime itself. The essence of treachery is the sudden and unexpected attack on the
unsuspecting victim. Hence, treachery is absent when the victim was placed on his guard, like when a heated
argument has preceded the attack, or when the victim was standing face to face with his assailants. The fatal
stabbing of Rosalino by Ramon was immediately preceded by two altercations between Ramon and Virgilio, on
one hand, and Rosalino, on the other. The first altercation occurred right after the near-collision of the tricycles,
while the other happened shortly after Ramon and Virgilio had blocked Rosalinos tricycle. During the second
altercation, Rosalino stood face to face with Ramon and Virgilio. It was then when Ramon stabbed the victim
twice, the sequential method of attack being borne out in the necropsy report showing that Rosalino had
sustained two fatal stab wounds in the chest and abdomen. Under the circumstances, Rosalino was rendered
completely aware of the imminent danger to himself from Ramon and Virgilio, rendering their assault far from
sudden and unexpected as to put Rosalino off his guard against any deadly assault. To stress, treachery cannot
be appreciated if the victim was forewarned of an impending danger and could have foreseen the aggression of
the accused. With treachery not being proved beyond reasonable doubt, the crime Ramon was properly guilty
of was homicide. Pursuant to Article 249 of the Revised Penal Code, the penalty for homicide is reclusion
temporal.
Ramons voluntary surrender was a mitigating circumstance that lowered the imposable penalty
Voluntary surrender is a circumstance that reduces the penalty for the offense. Its requisites as a mitigating
circumstance are that: (1) the accused has not been actually arrested; (2) the accused surrenders himself to a
person in authority or the latters agent; and (3) the surrender is voluntary. The presence of the foregoing
requisites was sufficiently proven by Ramon. He had voluntarily yielded himself and the balisong used in the
stabbing to Barangay Chairman Rey Loilo of Beguin, Bulan, Sorsogon, who then brought him and the weapon
to the police station for proper disposal.

People of the Philippines vs. Victorino Reyes

G.R. No. 173307, July 17, 2013
BERSAMIN, J.:
Slightest penetration of the labia of the female victim's genitalia consummates the crime of rape.
FACTS:
Reyes raped AAA at around 9:00 p.m. on December 26, 1996 in Barangay San Aurelio, Balungao, Pangasinan.
Earlier, at around 7:00 p.m., AAA and her 9-year-old sister, BBB, had watched television at his house just
across the street from their house. Only Reyes and his two sons, aged seven and five, were the other persons in
the house, for his wife had gone to another barangay to sell refreshments. By 9:00 p.m., AAA and BBB rose to
go home, but as they were leaving, Reyes suddenly pulled AAA into the store attached to the sala of his house.
He told her in the dialect: Umaykan ta agiyyot ta. (Come here and let us have sex). Alarmed by what his words
denoted, AAA struggled to free herself from him. BBB went to her succor by pulling her away from him, but
his superior strength prevailed. Inside the store, Reyes kissed AAA and mashed her breasts. He threatened her:
If you will shout, I will kill you. He pulled down her long pants and panties below her knees, took out his penis,
grabbed her by the waist, and used his body to anchor her back to a nearby table. She fought back by boxing
and pushing him away, but her efforts were futile. He twice tried to pry open her legs, but she strained hard to
close them. On the second attempt, however, her effort was not enough to prevent him from pulling her legs
apart, and he then thrust his penis into her vagina and made push and pull movements. Although his penis
achieved only a slight penetration of her vagina, he succeeded in satisfying his lust, as confirmed later on when
CCC, the mother of the victim, found semen on AAAs panties.

ISSUE: Whether or not the rape was committed

RULING:
Article 335 of the Revised Penal Code, as amended by Section 11 of Republic Act No. 7659, the law applicable
at the time of the rape of AAA. The breaking of the hymen of the victim is not among the means of
consummating rape. All that the law required is that the accused had carnal knowledge of a woman under the
circumstances described in the law. By definition, carnal knowledge was the act of a man having sexual bodily
connections with a woman. This understanding of rape explains why the slightest penetration of the female
genitalia consummates the crime. During her examination of AAA, Dra. Gancinia found pamamaga
(swelling) on the victims labia majora. Dra. Gancinia opined that such swelling was possibly caused by the
insertion of a hard object, like a hard penis, or by friction with hard objects even without removing the panties
or pants of AAA.23 Although such medical finding, left alone, was susceptible of different probable
interpretations, AAAs testimonial narration about how Reyes had sexually assaulted her, including how his
penis had only slightly penetrated her vagina, confirmed that he had carnal knowledge of her. More
specifically, the presence of the swelling in AAAs labia majora was an indication of the penetration by the
erect penis of the labia majora of the accused. As such, there was sufficient factual foundation for finding him
guilty beyond reasonable doubt of rape.

People of the Philippines vs. Tomas Teodoro

G.R. No. 175876, February 20, 2013
BERSAMIN, J.:
The recantation of her testimony by the victim of rape is to be disregarded if the records show that it was
impelled either by intimidation or by the need for the financial support of the accused.
FACTS:
Two informations charged Teodoro with statutory rape in which the victim, AAA, was the 8-year old daughter
of BBB, his common-law wife. With respect to the statutory rape charged in Criminal Case No. 9802, the
records show that BBB left home in Kitcharao, Agusan del Norte on an errand in Surigao; that her children,
including AAA, were left under the care of Teodoro, her common-law husband; that late that night, he returned
home drunk, and his arrival roused the children from their sleep, because they had not yet eaten; that soon after
the dinner, he told the children to go to bed; that AAA became puzzled when he turned off the lights that were
supposed to be left on; that at some point later in the night, he roused AAA, and ordered her to strip naked; that
she initially defied him, but he himself then undressed her; that he took off his pants and drawers down to his
knees, exposing his penis; that he went on top of her, inserted his penis in her vagina, and made push and pull
movements; that she felt a sharp pain inside her vagina; that he stopped his movements when she protested due
to her pain becoming unbearable, because he did not want the other children to be roused from sleep; that he
returned to his own place, but she got up to relieve herself; that she felt searing pain in her vagina as she was
relieving herself; and that she did not tell her mother upon the latters return from Surigao about what Teodoro
had done to her. Anent the rape committed on Criminal Case No. 98-03, BBB was again away from the house,
having gone to Manila. Teodoro committed the rape in a fashion similar to that in the first rape. However, AAA
could no longer bear her ordeal, and told of the rapes to CCC, the older brother of BBB: Tay, I was touched by
Tomas Teodoro. CCC immediately reported the crimes to the Kitcharao Police Station. The police quickly
arrested Teodoro. Upon BBBs return in the afternoon, CCC informed her about what Teodoro had done to her
daughter. BBB and CCC took AAA to the Kitcharao District Hospital for physical and medical examination.
During the trial, AAA and BBB testified for the Prosecution, but two years later recanted and turned hostile
towards the Prosecution, now telling the RTC that Teodoro had only touched AAAs vagina on the nights of
December 18, 1997 and February 8, 1998. RTC rendered its judgment convicting Teodoro on both counts of
statutory rape notwithstanding the recantations by AAA and BBB.

ISSUE: (1) Were the rapes charged against Teodoro established beyond reasonable doubt? (2) Should the
recantation by AAA be accepted?

RULING: (1) Yes (2) No

The crimes charged were two counts of statutory rape. The elements of statutory rape are that: (a) the victim is
a female under 12 years or is demented; and (b) the offender has carnal knowledge of the victim. Considering
that the essence of statutory rape is carnal knowledge of a female without her consent, neither the use of force,
threat or intimidation on the female, nor the females deprivation of reason or being otherwise unconscious, nor
the employment on the female of fraudulent machinations or grave abuse of authority is necessary to commit
statutory rape. Full penile penetration of the females genitalia is not likewise required, because carnal
knowledge is simply the act of a man having sexual bodily connections with a woman.
AAAs recollections given in court when she was only eight years old disclosed an unbroken and consistent
narration of her ordeals at his hands. She thereby revealed details that no child of her very tender age could
have invented or concocted. The only rational and natural conclusion to be made by any objective arbiter is to
accord the fullest credence to her. AAA remained categorical and steadfast about what Teodoro had done to her
all throughout her testimony in court, even during her delivery of the supposed recantation. She narrated how
he had committed the rape in the evening of December 18, 1997 by undressing her and himself, going on top of
her, inserting his male organ into her vagina, and making push and pull motions, causing her to suffer severe
pain in her vagina. Here, the proof of the penis of Teodoro touching the labias of AAA was sufficient and
convincing. Dr. Abrenillo found the touching by Teodoros penis had gone beyond the mons pubis and had
reached the labias of the victim.
Even during her intended recantation, AAA cried most of the time. Such demeanor reflected how much she
despised what he had done to her twice. As such, her supposed recantation did not conceal the impelling motive
for it being that her mother and her family still needed the material support of Teodoro. This was confirmed
even by BBB, whose own testimony on AAAs supposed recantation. BBB was then rearing four young
children by Teodoro (the youngest being born when he was already detained), as well as AAA and her five
siblings that BBB had from an earlier relationship. She unabashedly needed the material support of Teodoro;
hence, she prevailed on AAA to withdraw her charges against him. But a recantation under such insincere
circumstances was unacceptable.
As a rule, recantation is viewed with disfavor firstly because the recantation of her testimony by a vital witness
of the State like AAA is exceedingly unreliable, and secondly because there is always the possibility that such
recantation may later be repudiated. Indeed, to disregard testimony solemnly given in court simply because the
witness recants it ignores the possibility that intimidation or monetary considerations may have caused the
recantation. Before allowing the recantation, therefore, the court must not be too willing to accept it, but must
test its value in a public trial with sufficient opportunity given to the party adversely affected to cross-examine
the recanting witness both upon the substance of the recantation and the motivations for it. The recantation, like
any other testimony, is subject to the test of credibility based on the relevant circumstances, including the
demeanor of the recanting witness on the stand. In that respect, the finding of the trial court on the credibility of
witnesses is entitled to great weight on appeal unless cogent reasons necessitate its re-examination, the reason
being that the trial court is in a better position to hear first-hand and observe the deportment, conduct and
attitude of the witnesses.

People of the Philippines vs. Pedro Buado

G.R. No. 170634, January 8, 2013
BERSAMIN, J.:
In reviewing rape convictions, the Court has been guided by three principles, namely: (a) that an accusation of
rape can be made with facility; it is difficult for the complainant to prove but more difficult for the accused,
though innocent, to disprove; (b) that in view of the intrinsic nature of the crime of rape as involving only two
persons, the rapist and the victim, the testimony of the complainant must be scrutinized with extreme caution;
and (c) that the evidence for the Prosecution must stand or fall on its own merits, and cannot be allowed to
draw strength from the weakness of the evidence for the Defense.
FACTS:
This case tells the revolting story of a lecherous father who made two of his very young daughters his sex
slaves for several years right in the family home. The trial court convicted him and prescribed the death penalty
for each of the two counts of rape. There would be no hesitation to affirm the penalty, but the intervening
passage of the law prohibiting the imposition of the death penalty now spares him from the supreme penalty.

ISSUE: Whether or not the conviction was correct

RULING: Yes
In reviewing rape convictions, the Court has been guided by three principles, namely: (a) that an accusation of
rape can be made with facility; it is difficult for the complainant to prove but more difficult for the accused,
though innocent, to disprove; (b) that in view of the intrinsic nature of the crime of rape as involving only two
persons, the rapist and the victim, the testimony of the complainant must be scrutinized with extreme caution;
and (c) that the evidence for the Prosecution must stand or fall on its own merits, and cannot be allowed to
draw strength from the weakness of the evidence for the Defense.
The RTC as the trial court and the CA as the intermediately reviewing tribunal did not overlook or disregard
any fact or circumstance of significance. Instead, they correctly appreciated the evidence, and rightly concluded
that the accused committed the rapes of his own daughters. They regarded and accepted AAA and BBB as
credible witnesses whose recollections about their fathers lecherous acts deserved the fullest faith and
credence. On the other hand, the accused did not bring to the Courts attention any facts and circumstances of
weight that, if properly considered, would change the result into one favorable to him. He did not also submit to
us any argument that would lead us to doubt the findings of the RTC and the CA on the credibility of AAA and
BBB.
His frequent acts of domestic violence against even the young members of his family caused AAA and her
mother to fear him. Under the circumstances, the delay in reporting him to the proper authorities is not a factor
in determining the credibility of the charge against him of his own daughter. To a child of very tender years like
AAA, the threats of actual physical harm would definitely instill a fear overwhelming enough to force her to
suffer her ordeals in silence for a period of time.
The essence of rape is the carnal knowledge of a female either against her will (through force or intimidation)
or without her consent (where the female is deprived of reason or otherwise unconscious, or is under 12 years
of age, or is demented). Carnal knowledge of a female simply means a male having bodily connections with a
female. As such, the presence or absence of injury or laceration in the genitalia of the victim is not decisive of
whether rape has been committed or not. Such injury or laceration is material only if force or intimidation is an
element of the rape charged; otherwise, it is merely circumstantial evidence of the commission of the rape.
Verily, a medical examination and a medical certificate, albeit corroborative of the commission of rape, are not
indispensable to a successful prosecution for rape. The accused may then be convicted solely on the basis of the
victims credible, natural and convincing testimony. This is no less true when the rape victim testifies against
her own father; unquestionably, there would be reason to give her testimony greater weight than usual.
In Criminal Case No. 912-V-99, the amended information alleged that AAA was only ten years old when the
rape was committed in April 1999 and that she was the daughter of the accused. During the trial, however, the
Prosecution adduced no evidence to establish her minority save her testimony and that of her mothers. In the
absence of proof of AAAs minority in accordance with the guidelines set in People v. Pruna, we concur with
the CAs conclusion that he could not be properly found guilty of qualified rape. On the other hand, the
amended information in Criminal Case No. 974-V-99 sufficiently stated the minority of BBB and her being the
daughter of the accused. Further, the Prosecution established that BBB was only nine years old at the time of
the rape on November 10, 1999 through her certificate of live birth. In addition, her own mother and older
sister DDD both attested that she was the legitimate daughter of the accused. In fact, even the accused himself
admitted his legitimate paternity of BBB. Considering that the Prosecution duly proved BBBs minority and
her relationship with the accused, the CA correctly affirmed the penalty of death meted by the RTC.
With the intervening passage on June 24, 2006 of Republic Act No. 9346, however, the imposition of the death
penalty has become prohibited. The retroactive application to Criminal Case No. 974-V-99 of the prohibition
against the death penalty must be made here because it is favorable to the accused. Nonetheless, he shall not be
eligible for parole, because Section 3 of Republic Act No. 9346 expressly provides that persons whose
sentences will be reduced to reclusion perpetua by reason of this Act shall not be eligible for parole under Act
No. 4103 (Indeterminate Sentence Law), as amended.

George Bongalon vs. People of the Philippines

G.R. No. 169533, March 20, 2013
BERSAMIN, J.:
Not every instance of the laying of hands on a child constitutes the crime of child abuse under Section 10 (a) of
Republic Act No. 7610.1 Only when the laying of hands is shown beyond reasonable doubt to be intended by
the accused to debase, degrade or demean the intrinsic worth and dignity of the child as a human being should
it be punished as child abuse. Otherwise, it is punished under the Revised Penal Code.
FACTS:
Prosecutors Office of Legazpi City charged the petitioner in RTC in Legazpi City with child abuse, an act in
violation of Section 10(a) of Republic Act No. 7610. Jayson Dela Cruz and Roldan, his older brother, both
minors, joined the evening procession for the Santo Nio at Oro Site in Legazpi City; that when the procession
passed in front of the petitioners house, the latters daughter Mary Ann Rose, also a minor, threw stones at
Jayson and called him sissy; that the petitioner confronted Jayson and Roldan and called them names like
strangers and animals; that the petitioner struck Jayson at the back with his hand, and slapped Jayson on
the face; that the petitioner then went to the brothers house and challenged Rolando dela Cruz, their father, to a
fight, but Rolando did not come out of the house to take on the petitioner; that Rolando later brought Jayson to
the Legazpi City Police Station and reported the incident; that Jayson also underwent medical treatment at the
Bicol Regional Training and Teaching Hospital. RTC found and declared the petitioner guilty of child abuse as
charged. CA affirmed the conviction. The petitioner has come to the Court via a petition for certiorari under
Rule 65 of the Rules of Court.

ISSUE: (1) Whether or not the petitioner availed of the proper remedy? (2) Whether or not the petitioner must
be acquitted

RULING: (1) No (2) Yes

We should observe that the petitioner has adopted the wrong remedy in assailing the CAs affirmance of his
conviction. His proper recourse from the affirmance of his conviction was an appeal taken in due course.
Hence, he should have filed a petition for review on certiorari. Instead, he wrongly brought a petition for
certiorari.
Although we affirm the factual findings of fact by the RTC and the CA to the effect that the petitioner struck
Jayson at the back with his hand and slapped Jayson on the face, we disagree with their holding that his acts
constituted child abuse within the purview of the above-quoted provisions. The records did not establish
beyond reasonable doubt that his laying of hands on Jayson had been intended to debase the intrinsic worth
and dignity of Jayson as a human being, or that he had thereby intended to humiliate or embarrass Jayson. The
records showed the laying of hands on Jayson to have been done at the spur of the moment and in anger,
indicative of his being then overwhelmed by his fatherly concern for the personal safety of his own minor
daughters who had just suffered harm at the hands of Jayson and Roldan. With the loss of his self-control, he
lacked that specific intent to debase, degrade or demean the intrinsic worth and dignity of a child as a human
being that was so essential in the crime of child abuse. It is not trite to remind that under the well-recognized
doctrine of pro reo every doubt is resolved in favor of the petitioner as the accused. Thus, the Court should
consider all possible circumstances in his favor. What crime, then, did the petitioner commit? Considering that
Jaysons physical injury required five to seven days of medical attention, the petitioner was liable for slight
physical injuries under Article 266 (1) of the Revised Penal Code.

Gilfredo Bacolod vs. People of the Philippines

G.R. No 206236, July 15, 2013
BERSAMIN, J.:
It is imperative that the courts prescribe the proper penalties when convicting the accused, and determine the
civil liability to be imposed on the accused, unless there has been a reservation of the action to recover civil
liability or a waiver of its recovery.
FACTS:
Regional Trial Court (RTC), Branch 9, in Cebu City convicted the petitioner of arson. Court of Appeals (CA)
affirmed the conviction. The petitioner submits that both the RTC and the CA erred in their appreciation of the
evidence. He insists that no witness had actually seen him set the house on fire; that the State did not show that
he had the motive to commit the arson; and that only circumstantial evidence was presented against him, but
such evidence, not being incompatible with the hypothesis favoring his innocence, was insufficient to support
a conviction beyond reasonable doubt.

ISSUE: Whether or not convicted must be affirmed

RULING:
The lack or absence of direct evidence does not necessarily mean that the guilt of the accused cannot be proved
by evidence other than direct evidence. Direct evidence is not the sole means of establishing guilt beyond
reasonable doubt, because circumstantial evidence, if sufficient, can supplant the absence of direct evidence.
The RTCs reliance on circumstantial evidence was sanctioned by Rule 133, Section 4 of the Rules of Court.
The States witnesses credibly and reliably described a chain of circumstances that absolutely incriminated the
petitioner in the criminal burning of the house of complainants Spouses Ceferino and Gemma Cogtas. As both
the trial and appellate courts found, the following interconnected factual links were proved, namely: (1)
prosecution witness Ruben Gonzales heard the loud voices of the petitioner and his sister coming from the
Cogtas house that the Bacolod family had been renting, with the petitioner demanding money from his sister
Daisy Mae Bacolod but the latter not acceding to the demand; he was then only about 15 arms lengths away
from the Cogtas house; (2) not soon after, Gonzales heard a commotion inside the Cogtas house, and then
immediately saw Daisy Mae and three other persons running out of the house asking for help; (3) Gonzales
himself going towards the house to see what was happening, saw the petitioner in the kitchen waving a flaming
blanket that he had lit from the burner stove; (4) the petitioner then came out of the house, daring anyone to
arrest him; (5) Gonzales turned off the burner stove in the kitchen, even as he saw the ceiling of the kitchen
already in flames; and (6) the fire immediately spread to the other parts of the house, and which eventually
burned down the house completely. Gonzales account about the commotion inside the house was corroborated
by Alexander Cernal, a barangay tanod who happened to be on board his tricycle at the same subdivision where
the Cogtas house was located. The CA did not err in holding that the States circumstantial evidence sufficed
for the conviction of the petitioner. Indeed, the unbroken chain of circumstances established from the
recollections of witnesses whose motives had not been impugned at all by the petitioner warranted no
conclusion but that the petitioner had deliberately caused the burning of the house.
Nonetheless, the Court needs to correct the penalty the RTC imposed on the petitioner, and which the CA
affirmed in full. The indeterminate sentence of 10 years of prision mayor in its medium period, as minimum,
to 16 years of reclusion temporal in its medium period, as maximum, prescribed by the RTC was legally
erroneous. The information specifically alleged that the house burned by the accused was an inhabited
dwelling. Pursuant to Section 3(2) of Presidential Decree No. 1613 (Amending the Law on Arson), the penalty
to be imposed if the property burned is an inhabited house or dwelling is from reclusion temporal to reclusion
perpetua. Not being composed of three periods, however, such penalty should be divided into three equal
portions of time, and each portion forms one period of the penalty.6 Yet, reclusion perpetua, being an
indivisible penalty, immediately becomes the maximum period, leaving reclusion temporal to be divided into
two in order to fix the medium and minimum periods of the penalty. The three periods of the prescribed
penalty of reclusion temporal to reclusion perpetua are then as follows:
Minimum period 12 years and 1 day to 16 years; Medium period 16 years and 1 day to 20 years;
Maximum period reclusion perpetua.
Section 1 of the Indeterminate Sentence Law requires the court, in imposing a prison sentence for an offense
punished by the Revised Penal Code, or its amendments, to sentence the accused to an indeterminate sentence
the maximum term of which shall be that which, in view of the attending circumstances, could be properly
imposed under the rules of the said Code, and the minimum which shall be within the range of the penalty next
lower to that prescribed by the Code for the offense. Accordingly, the maximum of the indeterminate penalty
in this case should be within the range of the medium period of the penalty, i.e., from 16 years and 1 day to 20
years, because neither aggravating nor mitigating circumstance attended the commission of the crime; and the
minimum of the indeterminate sentence should be within the range of the penalty next lower in degree to that
prescribed for the crime, without regard to its periods.
It appears, therefore, that the maximum of the indeterminate penalty fixed by the RTC fell short by one day in
order to come within the medium period of the prescribed penalty. Although such fixing by the RTC was
contrary to the Indeterminate Sentence Law, the CA uncharacteristically condoned the violation. The correction
should now be made to make the sentence conform to law. Accordingly, the maximum of the indeterminate
sentence of the petitioner is 16 years and one day of reclusion temporal.
Another substantial detail left out by the RTC, and, later on, by the CA pertained to the civil liability to be
assessed against the petitioner in favor of the Spouses Cogtas as owners of the burned house. Having
pronounced the petitioner guilty of committing arson, a crime against property, the RTC and the CA were
bound to have then adjudged him civilly liable to compensate the Spouses Cogtas for their substantial
economic damage and prejudice as the owners of the house. The RTC briefly discussed the economic loss of
the Spouses Cogtas in its judgment but surprisingly omitted any award from the decretal portion.
The unfair omission should be rectified. In the records was testimony given by Architect Gabriel F. Abear to
the effect that the Spouses Cogtas would need to spend P869,590.00 to restore their burned dwelling to its
condition before the crime. In the absence of a showing that such amount had been actually expended in a
manner capable of substantiation by any document or receipt, Abears valuation remained a mere estimate, and
could not be the measure of an award for actual damages.

Noel Lasanas vs. People of the Philippines

G.R. No. 159031, June 23, 2014
BERSAMIN, J.:
Any person who contracts a second marriage without first having a judicial declaration of the nullity of his or
her first marriage, albeit on its face void and inexistent for lack of a marriage license, is guilty of bigamy as
defined and penalized by Article 349 of the Revised Penal Code.
FACTS:
On February 16, 1968, Judge Carlos B. Salazar of the Municipal Trial Court of San Miguel, Iloilo
solemnized the marriage of accused Noel Lasanas and Socorro Patingo without the benefit of a marriage
license. The records show that Lasanas and Patingo had not executed any affidavit of cohabitation to excuse the
lack of the marriage license. On August 27, 1980, Lasanas and Patingo reaffirmed their marriage vows in a
religious ceremony before Fr. Rodolfo Tamayo. They submitted no marriage license or affidavit of cohabitation
for that purpose. Both ceremonies were evidenced by the corresponding marriage certificates. In 1982, Lasanas
and Patingo separated de facto because of irreconcilable differences.
On December 27, 1993, the accused contracted marriage with Josefa Eslaban in a religious ceremony
solemnized by Fr. Ramon Sequito. Their marriage certificate reflected the civil status of the accused as single.
On July 26, 1996, the accused filed a complaint for annulment of marriage and damages against
Socorro in the RTC in Iloilo City alleging that Socorro had employed deceit, misrepresentations and fraud in
securing his consent to their marriage. In October 1998, Socorro charged the accused with bigamy. After due
proceedings, the accused was formally indicted for bigamy under the information filed on October 20, 1998 in
the RTC.
November 24, 1998, the RTC rendered its judgment in Civil Case dismissing the accuseds complaint
for annulment of marriage, and declaring the marriage between him and Socorro valid and legal.
On October 30, 2000, the RTC (Branch 38) rendered its assailed decision in Criminal Case finding
accused NOEL LASANAS guilty beyond reasonable doubt of the offense of BIGAMY punishable under Art.
349 of the Revised Penal Code. Aggrieved, the accused appealed his conviction to the CA, contending that
because he had not been legally married to Socorro, the first element of bigamy was not established. The CA
promulgated its challenged decision dismissing the appeal. Hence, the accused has appealed by petition for
review on certiorari.

ISSUE: Whether or not the conviction should be upheld.

RULING: YES

Any person who contracts a second marriage without first having a judicial declaration of the nullity
of his or her first marriage, albeit on its face void and inexistent for lack of a marriage license, is guilty of
bigamy as defined and penalized by Article 349 of the Revised Penal Code.
The elements of the crime of bigamy are as follows: (1) that the offender has been legally married; (2)
that the marriage has not been legally dissolved or, in case his or her spouse is absent, the absent spouse could
not yet be presumed dead according to the Civil Code; (3) that he or she contracts a second or subsequent
marriage; and (4) that the second or subsequent marriage has all the essential requisites for validity.
Based on the findings of the CA, this case has all the foregoing elements attendant.
The first and second elements of bigamy were present in view of the absence of a judicial declaration
of nullity of marriage between the accused and Socorro. The requirement of securing a judicial declaration of
nullity of marriage prior to contracting a subsequent marriage is found in Article 40 of the Family Code. The
Family Law Revision Committee and the Civil Code Revision Committee which drafted what is now the
Family Code of the Philippines took the position that parties to a marriage should not be allowed to assume that
their marriage is void even if such be the fact but must first secure a judicial declaration of the nullity of their
marriage before they can be allowed to marry again. In fact, the requirement for a declaration of absolute
nullity of a marriage is also for the protection of the spouse who, believing that his or her marriage is illegal
and void, marries again. With the judicial declaration of the nullity of his or her marriage, the person who
marries again cannot be charged with bigamy.
If petitioners contention would be allowed, a person who commits bigamy can simply evade
prosecution by immediately filing a petition for the declaration of nullity of his earlier marriage and hope that a
favorable decision is rendered therein before anyone institutes a complaint against him. We note that in
petitioners case the complaint was filed before the first marriage was declared a nullity. It was only the filing
of the Information that was overtaken by the declaration of nullity of his first marriage. Following petitioners
argument, even assuming that a complaint has been instituted, such as in this case, the offender can still escape
liability provided that a decision nullifying his earlier marriage precedes the filing of the Information in court.
Such cannot be allowed. To do so would make the crime of bigamy dependent upon the ability or inability of
the Office of the Public Prosecutor to immediately act on complaints and eventually file Informations in court.
The accuseds defense of acting in good faith deserves scant consideration especially because the
records show that he had filed a complaint for the annulment of his marriage with Socorro prior to the
institution of the criminal complaint against him but after he had already contracted his second marriage with
Josefa. But even such defense would abandon him because the RTC (Branch 39) dismissed his complaint for
annulment of marriage after the information for bigamy had already been filed against him, thus confirming the
validity of his marriage to Socorro. Considering that the accuseds subsequent marriage to Josefa was an
undisputed fact, the third element of bigamy was established. Nonetheless, he submits that his marriage to
Josefa was invalid because of lack of a recorded judgment of nullity of marriage. Such argument had no worth,
however, because it was he himself who failed to secure a judicial declaration of nullity of his previous
marriage prior to contracting his subsequent marriage.
There is therefore a recognition written into the law itself that such a marriage, although void ab initio,
may still produce legal consequences. Among these legal consequences is incurring criminal liability for
bigamy. Under Article 349 of the Revised Penal Code, the penalty for bigamy is prision mayor. With neither
an aggravating nor a mitigating circumstance attendant in the commission of the crime, the imposable penalty
is the medium period of prision mayor, which ranges from eight years and one day to 10 years. Applying
the Indeterminate Sentence Law, the minimum of the indeterminate sentence should be within the range
of prision correccional, the penalty next lower than that prescribed for the offense, which is from six months
and one day to six years. Accordingly, the indeterminate sentence of two years and four months of prision
correccional, as minimum, to eight years and one day of prision mayor as maximum, as imposed by the RTC,
was proper.

People of the Philippines vs. Larry Mendoza

G.R. No. 192432, June 23, 2014
BERSAMIN, J.:
The law enforcement agents who conduct buy-bust operations against persons suspected of drug trafficking in
violation of Republic Act No. 9165 (RA No. 9165), otherwise known as the Comprehensive Dangerous Drugs
Act of 2002, should comply with the statutory requirements for preserving the chain of custody of the seized
evidence. Failing this, they are required to render sufficient reasons for their non-compliance during the trial;
otherwise, the presumption that they have regularly performed their official duties cannot obtain, and the
persons they charge should be acquitted on the ground of reasonable doubt
FACTS:
The accusatory portion of the information charging the violation of Section 5 of RA No. 9165 reads
that the above-named accused, without having been authorized by law, did then and there willfully, unlawfully
and knowingly sell, deliver and give away to a poseur buyer 0.03 gram and 0.01 gram or a total weight of 0.04
gram of white crystalline substance contained in two (2) heat-sealed transparent plastic sachets, which
substance was found positive to the test for Methylamphetamine hydrochloride also known as shabu, a
dangerous drug, in violation of the above-cited law.
The accusatory portion of the information charging the violation of Section 11 of RA No. 9165 alleges
that the above-named accused, not being lawfully authorized to possess any dangerous drug, did, then and there
willfully, unlawfully and knowingly possess and have in his custody and control 0.01 gram of white crystalline
substance contained in one (1) heat-sealed transparent plastic sachet, which substance was found positive to the
test for Methylamphetamine hydrochloride also known as shabu, a dangerous drug, in violation of the above-
cited law.
The RTC convicted the accused of the crimes charged. The accused appealed, contending that the
identity of the corpus delicti and the fact of illegal sale had not been established beyond reasonable doubt but
the CA affirmed the conviction of the accused.

ISSUE: Whether or not the CA erred in finding the accused guilty beyond reasonable doubt of the violations of
Section 5 and Section 11 of RA No. 9165.

RULING: YES.

The law enforcement agents who conduct buy-bust operations against persons suspected of drug
trafficking in violation of Republic Act No. 9165 (RA No. 9165), otherwise known as the Comprehensive
Dangerous Drugs Act of 2002, should comply with the statutory requirements for preserving the chain of
custody of the seized evidence. Failing this, they are required to render sufficient reasons for their non-
compliance during the trial; otherwise, the presumption that they have regularly performed their official
duties cannot obtain, and the persons they charge should be acquitted on the ground of reasonable doubt
The State did not satisfactorily explain substantial lapses committed by the buy-bust team in the chain of
custody; hence, the guilt of the accused for the crime charged was not established beyond reasonable
doubt

The identity of the dangerous drugs should be established beyond doubt by showing that the dangerous
drugs offered in court were the same substances bought during the buy-bust operation. This rigorous
requirement, known under RA No. 9165 as the chain of custody, performs the function of ensuring that
unnecessary doubts concerning the identity of the evidence are removed.
To discharge its duty of establishing the guilt of the accused beyond reasonable doubt, therefore, the
Prosecution must prove the corpus delicti. That proof is vital to a judgment of conviction. On the other hand,
the Prosecution does not comply with the indispensable requirement of proving the violation of Section 5 of
Republic Act No. 9165 when the dangerous drugs are missing but also when there are substantial gaps in the
chain of custody of the seized dangerous drugs that raise doubts about the authenticity of the evidence
presented in court. Based on the foregoing statutory rules, the manner and timing of the marking of the seized
drugs or related items are crucial in proving the chain of custody. An examination of the records reveals that
the buy-bust team did not observe the statutory procedures on preserving the chain of custody.
To start with, the State did not show the presence during the seizure and confiscation of the contraband,
as well as during the physical inventory and photographing of the contraband, of the representatives from the
media or the Department of Justice, or of any elected public official. The consequences of the failure of the
arresting lawmen to comply with the requirements of the law were dire as far as the Prosecution was concerned.
Without the insulating presence of the representative from the media or the Department of Justice, or any
elected public official during the seizure and marking of the sachets of shabu, the evils of switching, planting
or contamination of the evidence that had tainted the buy-busts conducted under the regime of RA No. 6425
(Dangerous Drugs Act of 1972) again reared their ugly heads as to negate the integrity and credibility of the
seizure and confiscation of the sachets of shabu that were evidence herein of the corpus delicti, and thus
adversely affected the trustworthiness of the incrimination of the accused. Indeed, the insulating presence of
such witnesses would have preserved an unbroken chain of custody.
Secondly, the records nowhere indicated, contrary to the claim of P/Insp. Lim, that the buy-bust team,
or any member thereof, had conducted the physical inventory of the confiscated items. We know this because
the States formal offer of evidence did not include such inventory.
And, thirdly, although PO1 Diocena asserted that photographs of the confiscated items and the marked
money were taken at the police station, it still behooved him to justify why the photographs of the
seized shabu was not taken immediately upon the seizure, and at the place of seizure. The State did not explain
this lapse.
With the chain of custody being demonstrably broken, the accused deserved to be acquitted of the
serious charges. Even if we rejected the frame-up defense of the accused, the unexplained failures and lapses
committed by the buy-bust team could not be fairly ignored. At the very least, they raised a reasonable doubt on
his guilt. Moreover, the Prosecution must rely on the strength of its own evidence, and not anchor its success
upon the weakness of the evidence of the accused. The burden of proof placed on the Prosecution arises from
the presumption of innocence in favor of the accused that no less than the Constitution has guaranteed.

The CA and the RTC erred in relying on the presumption of regularity in the performance of duty of the
arresting officers
We have usually presumed the regularity of performance of their official duties in favor of the
members of buy-bust teams enforcing our laws against the illegal sale of dangerous drugs. Such presumption is
based on three fundamental reasons, namely: first, innocence, and not wrong-doing, is to be presumed; second,
an official oath will not be violated; and, third, a republican form of government cannot survive long unless a
limit is placed upon controversies and certain trust and confidence reposed in each governmental department or
27
agent by every other such department or agent, at least to the extent of such presumption. But the presumption
is rebuttable by affirmative evidence of irregularity or of any failure to perform a duty.
The presumption of regularity of performance of official duty stands only when no reason exists in the
records by which to doubt the regularity of the performance of official duty. And even in that instance the
presumption of regularity will not be stronger than the presumption of innocence in favor of the accused.
Otherwise, a mere rule of evidence will defeat the constitutionally enshrined right to be presumed innocent.
 Moreover, the regularity of the performance of their duty could not be properly presumed in favor of
the policemen because the records were replete with indicia of their serious lapses. Where there is any hint of
irregularity committed by the police officers in arresting the accused and thereafter, several of which we have
earlier noted, there can be no presumption of regularity of performance in their favor.

Reynaldo Mariano vs. People of the Philippines

G.R. No. 178145, July 07, 2014
BERSAMIN, J.:
Reckless imprudence consists in voluntary, but without malice, doing or failing to do an act from which
material damage results by reason of inexcusable lack of precaution on the part of the person performing of
failing to perform such act, taking into consideration his employment or occupation, degree of intelligence,
physical condition and other circumstances regarding persons, time and place. To constitute the offense of
reckless driving, the act must be something more than a mere negligence in the operation of the motor vehicle,
but a willful and wanton disregard of the consequences is required.
FACTS:
The Office of the Provincial Prosecutor of Bulacan charged the petitioner with frustrated murder for
hitting and bumping Ferdinand de Leon while overtaking the latters jeep. Ferdinand de Leon was driving his
owner type jeep along Barangay Engkanto, Angat, Bulacan. With him were his wife, Urbanita, and their two-
year old son. Luis de Leon, an uncle of Ferdinand, also came from the baptismal party and was driving his
owner type jeep. Accused-appellant Reynaldo Mariano was driving his red Toyota pick-up with his wife,
Rebecca, and their helper, Rowena Aos, as passengers.
The Toyota pick-up overtook the jeep of Ferdinand de Leon and almost bumped it. Ferdinand got mad,
overtook the pick-up and blocked its path. Reynaldo Mariano stopped the pick-up behind the jeep. Ferdinand
alighted from his jeep and approached Reynaldo. Ferdinand claimed that he and Reynaldo had an altercation.
Urbanita tried to pacify Ferdinand and sought the assistance of Luis de Leon. Ferdinand and Reynaldo heeded
the advice of Luis and they went their separate ways.
Instead of proceeding to his house in Norzagaray, Ferdinand decided to drop by his mothers house in
San Roque, Angat to pick up some items. He parked his jeep in front of the house of his mother and alighted
therefrom. However, he was bumped by a moving vehicle, thrown four (4) meters away and lost consciousness.
Urbanita identified the fast moving vehicle that bumped Ferdinand as the same red Toyota pick-up driven by
Reynaldo. Ferdinand was brought to the Sto. Nio Hospital in Bustos, Bulacan, where he stayed for two and a
half days and incurred medical expenses.
The RTC convicted the petitioner of frustrated homicide. On appeal, the CA promulgated its assailed
modifying the felony committed by the petitioner from frustrated homicide to reckless imprudence resulting in
serious physical injuries.

ISSUE: Whether or not, the conviction for the crime for reckless imprudence resulting in serious physical
injuries should be upheld.

RULING:
YES. We affirm the conviction of the petitioner for reckless imprudence resulting in serious physical
injuries.
As aptly observed by the court a quo, only a vehicle that is moving beyond the normal rate of speed
and within the control of the drivers hands could have caused Ferdinands injuries. The very fact of speeding is
indicative of imprudent behavior, as a motorist must exercise ordinary care and drive at a reasonable rate of
speed commensurate with the conditions encountered, which will enable him or her to keep the vehicle under
control and avoid injury to others using the highway. Thus, had Reynaldo not driven his pick-up at a fast speed
in overtaking the jeep of Ferdinand, he could have easily stopped his pick-up or swerved farther to the left side
of the road, as there was no oncoming vehicle, when he saw that Ferdinand alighted from his jeep and lost his
balance, in order to avoid hitting the latter or, at least, minimizing his injuries.
The findings by the CA are controlling on the Court. Indeed, the findings of both lower courts on the
circumstances that had led to the injuries of Ferdinand fully converged except for the RTCs conclusion that
malicious intent had attended the commission of the offense. Such findings cannot be disturbed by the Court in
this appellate review, for it is a well-settled rule that the findings of the trial court, especially when affirmed by
the CA, are binding and conclusive upon the Court.
Reckless imprudence consists in voluntary, but without malice, doing or failing to do an act from
which material damage results by reason of inexcusable lack of precaution on the part of the person performing
of failing to perform such act, taking into consideration his employment or occupation, degree of intelligence,
physical condition and other circumstances regarding persons, time and place. To constitute the offense of
reckless driving, the act must be something more than a mere negligence in the operation of the motor vehicle,
but a willful and wanton disregard of the consequences is required. The Prosecution must further show the
direct causal connection between the negligence and the injuries or damages complained of.
Contrary to the petitioners insistence, the mitigating circumstance of voluntary surrender cannot be
appreciated in his favor. Paragraph 5 of Article 365, Revised Penal Code, expressly states that in the imposition
of the penalties, the courts shall exercise their sound discretion, without regard to the rules prescribed in Article
64 of the Revised Penal Code.
The penalty for the offender guilty of reckless imprudence is based on the gravity of the resulting
injuries had his act been intentional. Thus, Article 365 of the Revised Penal Code stipulates that had the act
been intentional, and would constitute a grave felony, the offender shall suffer arresto mayor in its maximum
period to prision correccional in its medium period; if it would have constituted a less grave felony, arresto
mayor in its minimum and medium periods shall be imposed; and if it would have constituted a light
felony, arresto menor in its maximum period shall be imposed. Pursuant to Article 9 of the Revised Penal
Code, a grave felony is that to which the law attaches the capital punishment or a penalty that in any of its
periods is afflictive in accordance with Article 25 of the Revised Penal Code; a less grave felony is that which
the law punishes with a penalty that is correctional in its maximum period in accordance with Article 25 of
the Revised Penal Code; and a light felony is an infraction of law for the commission of which a penalty of
either arresto menor or a fine not exceeding P200.00, or both is provided.
In its decision, the CA found that Ferdinand had sustained multiple facial injuries. It was also on record
that he had testified at the trial that he was unable to attend to his general merchandise store for three months
due to temporary amnesia; and that he had required the attendance of caregivers and a masseur until October
31, 1999. With Ferdinand not becoming insane, imbecile, impotent, or blind, his physical injuries did not fall
under Article 263, 1. Consequently, the CA incorrectly considered the petitioners act as a grave felony had it
been intentional, and should not have imposed the penalty at arresto mayor in its maximum period to prision
correccional in its medium period. Instead, the petitioners act that caused the serious physical injuries, had it
been intentional, would be a less grave felony under Article 25 of the Revised Penal Code, because Ferdinands
physical injuries were those under Article 263, 3, supra, for having incapacitated him from the performance of
the work in which he was habitually engaged in for more than 90 days.
Conformably with Article 365 of the Revised Penal Code, the proper penalty is arresto mayor in its
minimum and medium periods, which ranges from one to four months. As earlier mentioned, the rules in
Article 64 of the Revised Penal Code are not applicable in reckless imprudence, and considering further that the
maximum term of imprisonment would not exceed one year, rendering the Indeterminate Sentence
Law inapplicable, the Court holds that the straight penalty of two months of arresto mayor was the correct
penalty for the petitioner.
The Court agrees with the CAs modification of the award of actual and moral damages amounting to
P58, 402.75 and P10,000.00, respectively. Actual damages, to be recoverable, must not only be capable of
proof, but must actually be proved with a reasonable degree of certainty. This is because the courts cannot rely
on speculation, conjecture or guesswork in determining the fact and amount of damages. Here, the receipts
presented by the Prosecution proved the expenses actually incurred amounting to P108, 402.75, but such
aggregate was reduced by the victims earlier receipt of P50, 000.00 from the petitioner in the form of financial
assistance. Hence, the victim should recover only the unpaid portion of P58, 402.75.
Moral damages are given to ease the victims grief and suffering. Moral damages should reasonably
approximate the extent of the hurt caused and the gravity of the wrong done. Accordingly, the CA properly
reduced to P10, 000.00 the moral damages awarded to Ferdinand.
In addition, we impose an interest of 6% per annum on the actual and moral damages reckoned from
the finality of this decision until the full payment of the obligation. This is because the damages thus fixed
thereby become forbearance. The rate of 6% per annum is pursuant to Circular No. 799, series of 2013.
Manolito Zafra vs. People of the Philippines
G.R. No. 176317, July 23, 2014
BERSAMIN, J.
In convicting an accused of the complex crime of malversation of public funds through falsification of a public
document, the courts shall impose the penalty for the graver felony in the maximum period pursuant to Article
48 of the Revised Penal Code, plus fine in the amount of the funds malversed or the total value of the property
embezzled. In addition, the courts shall order the accused to return to the Government the funds malversed, or
the value of the property embezzled.
FACTS:
Appellant was the only Revenue Collection Agent of the Bureau of Internal Revenue (BIR), Revenue
District 3, in San Fernando, La Union from 1993-1995. Among his duties was to receive tax payments for
which BIR Form 25.24 or the revenue official receipts (ROR) were issued. The original of the ROR was then
given to the taxpayer while a copy thereof was retained by the collection officer.
On 06 July 1995, an audit team all from the central office of the BIR, was tasked to audit the cash and
non-cash accountabilities of the appellant. Among the documents reviewed by the audit team were the CARs
furnished by the Assessment Division of the BIR; triplicate copies of the RORs attached to the MRCs
submitted by appellant to COA; and appellants MRCs provided by the Finance Division of the BIR. The audit
team likewise requested and was given copies of the RORs issued to the San Fernando, La Union branch of the
Philippine National Bank (PNB). A comparison of the entries in said documents revealed that the data
pertaining to 18 RORs with the same serial number vary with respect to the name of the taxpayer, the kind of
tax paid, the amount of tax and the date of payment. Of particular concern to the audit team were the lesser
amounts of taxes reported in appellants MRCs and the attached RORs compared to the amount reflected in the
CARs and PNBs RORs.
Likewise, PNBs RORs bearing Serial Nos. 1529758, 2016733, 2018310, 2023837, 2617653. 2617821,
2627973, 3095194, 3096955, 3097386, 3503336, and 4534412, show that it paid the total sum of
Php500,606.15, as documentary stamp tax. Yet, appellants MRCs yielded only the total sum of Php1,115.00,
for the same RORs, or a difference of Php499,491.15. The subject 18 RORs were the accountability of
appellant as shown in his Monthly Reports of Accountability (MRA) or BIR Form 16 (A).
In sum, although the RORs bear the same serial numbers, the total amount reflected in the CARs and
PNBs 12 copies of RORs is PhP615,493.93, while only Php1,342.00 was reported as tax collections in the
RORs triplicate copies submitted by appellant to COA and in his MRCs, or a discrepancy of Php614,151.93,
Thus, the audit team sent to appellant a demand letter requiring him to restitute the total amount
of Php614,151.93. Appellant ignored the letter, thus, prompting the institution of the 18 cases for malversation
of public funds through falsification of public document against him.
The RTC rendered its consolidated decision convicting the petitioner of 18 counts of malversation of
public funds through falsification of public documents. On August 16, 2006, the CA promulgated its assailed
judgment affirming the conviction of the petitioner and the penalties imposed by the RTC. After the CA denied
his motion for reconsideration by its resolution promulgated on January 11, 2007, the petitioner appeals via
petition for review on certiorari.

ISSUE:
Whether or not the conviction of the petitioner for several counts of malversation of public funds through
falsification of public documents should be upheld.
Whether or not the penalties imposed were correct.

RULING:

The findings of fact of the RTC were affirmed by the CA. Hence, the petitioner was correctly convicted
of the crimes charged because such findings of fact by the trial court, being affirmed by the CA as the
intermediate reviewing tribunal, are now binding and conclusive on the Court. Accordingly, we conclude that
the Prosecution sufficiently established that the petitioner had been the forger of the falsified and tampered
public documents, and that the falsifications of the public documents had been necessary to commit the
malversations of the collected taxes.
 The petitioner merely relied on the passage of the RTCs ruling to buttress his contention that he should
be found guilty of malversation through negligence. His reliance is grossly misplaced, however, because the
RTC did not thereby pronounce that he had been merely negligent. The passage was nothing but a brief
forensic discourse on the legal consequence if his defenses were favorably considered, and was not the basis for
finding him guilty.
Initially, the CAs disquisition regarding malversation through negligence had the same tenor as that of
the RTCs, and later on even went to the extent of opining that the petitioner ought to be held guilty of
23
malversation through negligence. But such opinion on the part of the CA would not overturn his several
convictions for the intentional felonies of malversation of public funds through falsification of public
documents. As can be seen, both lower courts unanimously concluded that the States evidence established his
guilt beyond reasonable doubt for malversation of public funds through falsification of public documents.
At any rate, even if it were assumed that the findings by the CA warranted his being guilty only of
malversation through negligence, the Court would not be barred from holding him liable for the intentional
crime of malversation of public funds through falsification of public documents because his appealing the
convictions kept the door ajar for an increase in his liability. It is axiomatic that by appealing he waived the
constitutional protection against double jeopardy, leaving him open to being convicted of whatever crimes the
Court would ultimately conclude from the records to have been actually committed by him within the terms of
the allegations in the informations under which he had been arraigned.

Yet, we see an obvious need to correct the penalties imposed on the petitioner. He was duly convicted of 18
counts of malversation of public funds through falsification of public documents, all complex crimes. Pursuant
to Article 48 of the Revised Penal Code, the penalty for each count is that prescribed on the more serious
offense, to be imposed in its maximum period.
To determine the maximum periods of the penalties to be imposed on the petitioner, therefore, we must
be guided by the following rules, namely: (1) the penalties provided under Article 217 of the Revised Penal
Code constitute degrees; and (2) considering that the penalties provided under Article 217 of the Revised Penal
Code are not composed of three periods, the time included in the penalty prescribed should be divided into
three equal portions, which each portion forming one period, pursuant to Article 65 of the Revised Penal Code.
Accordingly, the penalties prescribed under Article 217 of the Revised Penal Code should be divided into three
periods, with the maximum period being the penalty properly imposable on each count, except in any instance
where the penalty for falsification would be greater than such penalties for malversation.
Under Section 1 of the Indeterminate Sentence Law, an indeterminate sentence is imposed on the
offender consisting of a maximum term and a minimum term. The maximum term is the penalty under
the Revised Penal Code properly imposed after considering any attending circumstance; while the minimum
term is within the range of the penalty next lower than that prescribed by the Revised Penal Code for the
offense committed.
The Indeterminate Sentence Law was applicable here, save for the counts for which the imposable
penalty was reclusion perpetua. Considering that each count was a complex crime without any modifying
circumstances, the maximum term of the penalty for each count is the maximum period. However, because
such penalty for malversation was lower than the penalty of prision mayor imposable on falsification of a
public document under Article 171 of the Revised Penal Code, it is the penalty of prision mayor in its
maximum period that was applicable. On other hand, the minimum of the indeterminate sentence for each
count should come from the penalty next lower than that prescribed under Article 217 of the Revised Penal
Code, except in Criminal Case No. 4635 where the penalty next lower is prision correccional in its full range.
In its consolidated decision of February 17, 2004, the RTC erred in pegging the maximum terms within
the minimum periods of the penalties prescribed under Article 217 of the Revised Penal Code. It committed
another error by fixing indeterminate sentences on some counts despite the maximum of the imposable
penalties being reclusion perpetua. There is even one completely incorrect indeterminate sentence. And, as
earlier noted, the penalty for falsification under Article 171 of the Revised Penal Code was applicable in
Criminal Case No. 4635 involving P4,869.00 due to its being the higher penalty.
One more omission by the CA and the RTC concerned a matter of law. This refers to their failure to
decree in favor of the Government the return of the amounts criminally misappropriated by the accused. That
he was already sentenced to pay the fine in each count was an element of the penalties imposed under
the Revised Penal Code, and was not the same thing as finding him civilly liable for restitution, which the RTC
and the CA should have included in the judgment.
 We also pointedly remind all trial and appellate courts to avoid omitting reliefs that the parties are
properly entitled to by law or in equity under the established facts. Their judgments will not be worthy of the
name unless they thereby fully determine the rights and obligations of the litigants. They should prescribe the
legal penalties, which is what the Constitution and the law require and expect them to do. Their prescription of
the wrong penalties will be invalid and ineffectual for being done without jurisdiction or in manifest grave
abuse of discretion amounting to lack of jurisdiction. They should also determine and set the civil liability ex
delicto of the accused, in order to do justice to the complaining victims who are always entitled to them.
The Rules of Court mandates them to do so unless the enforcement of the civil liability by separate actions has
been reserved or waived. In addition, the accused shall pay to the Government the total amount of P614,
268.73, plus interest of 6% per annum reckoned from the finality of this decision until full payment, by way of
his civil liability. The accused shall further pay the costs of suit.
In convicting an accused of the complex crime of malversation of public funds through falsification
of a public document, the courts shall impose the penalty for the graver felony in the maximum period
pursuant to Article 48 of the Revised Penal Code, plus fine in the amount of the funds malversed or the total
value of the property embezzled. In addition, the courts shall order the accused to return to the Government
the funds malversed, or the value of the property embezzled.

Ricardo Medina Jr. vs. People of the Philippines

G.R. No. 161308, January 15, 2014
BERSAMIN, J.:
It has been appropriately emphasized that [w]e have no test of the truth of human testimony, except its
conformity to our knowledge, observation, and experience. Whatever is repugnant to these belongs to the
miraculous and is outside of judicial cognizance.

FACTS:
This case concerns the fatal stabbing of Lino Mulinyawe which was preceded by a fight during a
basketball game between Ross Mulinyawe, Linos son, and Ronald Medina, the younger brother of Ricardo and
Randolf. Ronald had hit Ross with a piece of stone; hence, Ross was brought to the hospital for treatment. Lino
learned that his son had sustained a head injury, he forthwith went towards the house of the Medinas
accompanied by his drinking buddies, Tapan and Menes. He had a bread knife tucked in the back, but his
companions were unarmed.
Along the way, Lino encountered Randolf whom he confronted about the fight. The two of them had a
heated argument. Lino lashed out at Randolf and gripped the latters hand. Randolf retreated towards the store
and took two empty bottles of beer, broke the bottles and attacked Lino with them. Arriving at the scene,
Ricardo saw what was happening, and confronted Lino. Ricardo entered their house to get a kitchen knife and
came out. Lino made a thrust at Ricardo but failed to hit the latter, who then stabbed Lino on the left side of his
chest, near the region of the heart. Lino fell face down on the ground. Upon examination, it was declared that
cause of death is Stab wound of the chest. Ch
The Office of the City Prosecutor of Pasig City charged Randolf with homicide. The information was
amended with leave of court to include Ricardo as a coconspirator. The RTC acquitted Randolf but convicted
Ricardo of homicide for it found no evidence of conspiracy between Randolf and Ricardo.
ISSUE: Whether or not the conviction should be upheld.
RULING: YES.

The argument of Ricardo is a mere reiteration of his submissions that the CA had already exhaustively
considered and passed upon. He has not added anything of substance or weight to persuasively show that the
CA had erred in affirming the RTC. Ricardo likewise contends that the State did not present as evidence in
court the two knives wielded by him and Lino despite repeated demands for their presentation
Reviewing the records, We find that appellants guilt as the perpetrator of the unlawful killing of the
victim Lino Mulinyawe had been adequately proven by prosecution evidence, both testimonial and physical.
Contrary to appellants contention, the nonpresentation of blood samples from the victim and the accused as
well as the instrument which accused used in perpetrating his felonious acts do not negate criminal liability it
is enough for the prosecution to establish by the required quantum of proof that a crime was committed and the
accused was the author thereof. The presentation of the weapon is not a prerequisite for conviction. Such
presentation and identification of the weapon used are not indispensable to prove the guilt of the accused much
more so where the perpetrator has been positively identified by a credible witness. The nonidentification and
nonpresentation of the weapon actually used in the killing did not diminish the merit of the conviction
primarily because other competent evidence and the testimonies of witnesses had directly and positively
identified and incriminated Ricardo as the assailant of Lino.
The witnesses incriminating Ricardo were not only credible but were not shown to have harbored any
illmotive towards him. They were surely entitled to full faith and credit for those reasons, and both the RTC
and the CA did well in according such credence to them.
In order that defense of a relative is to be appreciated in favor of Ricardo, the following requisites must concur,
namely: (1) unlawful aggression by the victim; (2) reasonable necessity of the means employed to prevent or
repel the aggression; and (3) in case the provocation was given by the person attacked, that the person making
19
the defense took no part in the provocation. Like in selfdefense, it is the accused who carries the burden to
prove convincingly the attendance and concurrence of these requisites because his invocation of this defense
amounts to an admission of having inflicted the fatal injury on the victim.
However, his defense was unworthy of belief due to its incongruity with human experience.

It has been appropriately emphasized that [w]e have no test of the truth of human testimony, except its
conformity to our knowledge, observation, and experience. Whatever is repugnant to these belongs to the
miraculous and is outside of judicial cognizance.

Dr. Encarnacion Lumantas vs. Hanz Calapiz

G.R. No. 163753, January 15, 2014
BERSAMIN, J.:

It is axiomatic that every person criminally liable for a felony is also civilly liable. Nevertheless, the acquittal of
an accused of the crime charged does not necessarily extinguish his civil liability.

FACTS:
Spouses Calapiz brought their son Hanz Calapiz to the Misamis Occidental Provincial Hospital,
Oroquieta City, for an emergency appendectomy. Hanz was attended to by the petitioner, who suggested to the
parents that Hanz also undergo circumcision at no added cost to spare him the pain. Hanz complained of pain in
his penis, which exhibited blisters. His testicles were swollen. The parents noticed that the child urinated
abnormally after the petitioner forcibly removed the catheter, but the petitioner dismissed the abnormality as
normal. On January 30, 1995, Hanz was discharged from the hospital over his parents protestations.
On February 8, 1995, Hanz was confined in a hospital because of the abscess formation between the
base and the shaft of his penis. The petitioner referred him to Dr. Henry Go, an urologist, who diagnosed the
boy to have a damaged urethra. Thus, Hanz underwent cystostomy, and thereafter was operated on three times
to repair his damaged urethra. When his damaged urethra could not be fully repaired and reconstructed, Hanzs
parents brought a criminal charge against the petitioner for reckless imprudence resulting to serious physical
injuries. Information was filed in the Municipal Trial Court in Cities of Oroquieta City to which the latter
pleaded not guilty. The case was transferred to the RTC pursuant to Supreme Court Circular No. 11-99. The
RTC acquitted the petitioner of the crime charged for insufficiency of the evidence, but ruled the petitioner was
liable for moral damages because there was a preponderance of evidence showing that Hanz had received the
injurious trauma from his circumcision by the petitioner.

ISSUE: Whether or not the petitioner can be held civilly liable despite his acquittal of the crime of reckless
imprudence resulting in serious physical injuries.
RULING:
It is axiomatic that every person criminally liable for a felony is also civilly liable. Nevertheless, the
acquittal of an accused of the crime charged does not necessarily extinguish his civil liability.
Our law recognizes two kinds of acquittal, with different effects on the civil liability of the accused.
First is an acquittal on the ground that the accused is not the author of the act or omission complained of. This
instance closes the door to civil liability, for a person who has been found to be not the perpetrator of any act or
omission cannot and can never be held liable for such act or omission. The second instance is an acquittal based
on reasonable doubt on the guilt of the accused. In this case, even if the guilt of the accused has not been
satisfactorily established, he is not exempt from civil liability which may be proved by preponderance of
evidence only. Conformably with the foregoing, therefore, the acquittal of an accused does not prevent a
judgment from still being rendered against him on the civil aspect of the criminal case unless the court finds
and declares that the fact from which the civil liability might arise did not exist.
The petitioners contention that he could not be held civilly liable because there was no proof of his
negligence deserves scant consideration. The failure of the Prosecution to prove his criminal negligence with
moral certainty did not forbid a finding against him that there was preponderant evidence of his negligence to
hold him civilly liable. With the RTC and the CA both finding that Hanz had sustained the injurious trauma
from the hands of the petitioner on the occasion of or incidental to the circumcision, and that the trauma could
have been avoided, the Court must concur with their uniform findings.
In Hanzs case, the undesirable outcome of the circumcision performed by the petitioner forced the
young child to endure several other procedures on his penis in order to repair his damaged urethra. Surely, his
physical and moral sufferings properly warranted the amount of P50,000.00 awarded as moral damages.

Teofilo Giangan vs. People of the Philippines

G.R. No. 169385, August 26, 2015
BERSAMIN, J.:
FACTS:
In his capacity as the barangay chairman of Barangay Luyang in the Municipality of Carmen, Province of Cebu
at the time material to this case, Giangan, along with his co-accused Domail, a barangay councilor, and Bontia,
the head of the barangay tanods, were charged with the violation of Section 3 (e) of R. A. No. 3019. It appears
that Aurelia Bernadas hired Delfin Buot to construct the wooden fence on her land; that the accused removed
the fence; that Buot first learned of the removal of the fence from the residents of Barangay Luyang; that Buot
further learned that Giangan and his co-accused removed the wooden fence; that Buot first directly inquired
from Giangan why the latter had destroyed the fence, but he harshly told him to tell Bernadas to just file a case
against him; that Buot then went home to call Bernadas about the incident; and that Buot accompanied
Bernadas and her spouse to confront Giangan, who reiterated his dare for them to just file a case. Bernadas
testified that she had caused the construction of the fence on her three properties in Barangay Luyang because
the fruits of the coconut trees growing on her properties were frequently stolen, and also because the sand on
the seashore within her properties was being excavated; that she reported the theft to Giangan, who did not take
any action on her complaint; that she spent a total of P11,200.00 for labor and materials in the construction of
the fence; that upon learning of the removal of the fence, she visited Giangan to inquire, but the latter shouted
at her: It is within my power as barangay captain to destroy the fence, and Dont tell me what to do, you just
file a case in court; that many landowners put up fences on their properties in the area, but the fences were not
removed; and that there was no established road right of way on her properties ever since she could remember.
RTC Danao City rendered its judgment finding all of the accused guilty as charged

ISSUE: Whether or not the Sandiganbayan was correct in affirming the conviction of Giangan

RULING:
 In every prosecution for the violation of Section 3 (e) of R.A. No. 3019, the State must prove the following
essential elements, namely:
1. The accused is a public officer discharging administrative, judicial or official functions;
2. He must have acted with manifest partiality, evident bad faith, or gross inexcusable negligence in the
discharge of his functions and;
3. His action caused any undue injury to any party, including the Government, or gave any private party
unwarranted benefits, advantage or preference in the discharge of his functions.

The first element was present, for Giangan was indisputably a government official at the time of the alleged
commission of the offense charged. The second element enumerates the different modes by which means the
offense penalized in Section 3 (e) may be committed. "Partiality" is synonymous with "bias" which "excites a
disposition to see and report matters as they are wished for rather than as they are." "Bad faith does not simply
connote bad judgment or negligence; it imputes a dishonest purpose or some moral obliquity and conscious
doing of a wrong; it partakes of the nature of fraud." "Gross negligence has been so defined as negligence
characterized by the want of even slight care, acting or omitting to act in a situation where there is a duty to act,
not inadvertently but willfully and intentionally with a conscious indifference to consequences in so far as other
persons may be affected. Proof of the existence of any of these modes in connection with the prohibited acts
under Section 3 (e) should suffice to warrant conviction.

In this case, the Sandiganbayan erred in ruling that Giangan and his co-accused had acted with gross bad
faith and manifest impartiality when they removed the wooden posts of the fence of Bernadas. On the contrary,
their actuations evinced good faith. It was not at all disputed that access through the road had long been
permitted even by the owner and her predecessor. In that context, Giangan as the barangay chairman acted
upon the honest and sincere belief that he was then summarily abating the nuisance that a regular user of the
obstructed road had just reported to him. A further indication of the good faith of Giangan was the turning over
of the wooden posts to the police station, manifesting that the accused were acting within the scope of their
authority. .

The Sandiganbayan further erred in finding the presence of manifest partiality on the basis that there had been
other allegedly illegal constructions that the accused did not similarly remove in their capacities as barangay
officials. Bias should still not be imputed against them because they were acting on the complaint against the
inconvenience brought about by the obstruction erected on the access road. Manifest partiality should be
inferred only if there was a clear showing that there had been others who had been bothered by the similar
allegedly illegal constructions and had complained, but the accused, in their capacities as barangay officials,
did not deal with such complaint with the same alacrity. In light of the foregoing, the guilt of Giangan was not
established beyond reasonable doubt. Hence, he is entitled to acquittal.

Aurora Fransdilla vs. People of the Philippines

G.R. No. 197562, August 20, 2015
BERSAMIN, J.:
The complex crime of robbery in an inhabited house by armed persons and robbery with violence against or
intimidation of persons was committed when the accused, who held firearms, entered the residential house of
the victims and inflicted injury upon the victims in the process of committing the robbery. Hence, the penalty is
that imposed for the robbery in an inhabited house, the more serious
FACTS:
Aurora Engson Fransdilla (Fransdilla), the lone appellant, seeks to reverse the decision promulgated on
February 28, 2011,1 whereby the Court of Appeals (CA) affirmed her conviction and that of her co-accused for
robbery on the basis of conspiracy. At private complainants residence at No. 24, Mabait St., Teachers Village,
Quezon City, private complainant Lalaine Yreverre saw appellant Aurora Engson in front of their gate. Upon
noticing Aurora, Lalaine went to the gate and asked Aurora what is their purpose, as there were four (4) of
them. Aurora then inquired about Cynthia Yreverre, Lalaines sister. The latter replied that Cynthia was in the
Japanese Embassy and asked Aurora if there was any other person whom she wanted to talk to. It was then that
Aurora told Lalaine that she was from the Philippine Overseas Employment Agency (POEA). It was upon said
pretension that Lalaine offered herself to instead talk to her and allowed her to enter their house. Later on, four
men who are with Aurora went inside the house and announced that it was a hold-up.

ISSUE: Whether or not conspiracy was proved

RULING:
Conspiracy of Fransdilla with her co-accused was established beyond reasonable doubt
The State thus discharged its burden to produce before the trial court sufficient evidence against all the accused,
including Fransdilla, that would warrant a judgment of conviction. Fransdillas non-presentation of her defense,
despite her being directly incriminated by Lalaine, denied the Court her explanation for her specific overt acts
of complicity in the robbery and thus rendered the incriminating evidence unrefuted. By this the Court simply
means that Fransdilla did not discharge her burden of evidence, which is the duty of a party to start and
continue giving evidence at any stage of the trial until he has established a prima facie case, or the like duty of
the adverse party to meet and overthrow that prima facie case thus established. Fransdilla was satisfactorily
shown not to have been a mere passive coconspirator, but an active one who had facilitated the access into the
house by representing herself as an employee of the POEA. In that respect, it is not always required to establish
that two or more persons met and explicitly entered into the agreement to commit the crime by laying down the
details of how their unlawful scheme or objective would be carried out. Conspiracy can also be deduced from
the mode and manner in which the offense is perpetrated, or can be inferred from the acts of the several accused
evincing their joint or common purpose and design, concerted action and community of interest. Once
conspiracy is established, the act of each conspirator is the act of all.

People of the Philippines vs. Recto Angngao and Robert Carlin

G.R. No. 189296, March 11, 2015
BERSAMIN, J.:
The State bears the burden of establishing the chain of custody of the dangerous drugs confiscated during a
buy-bust operation. The evidence of the chain of custody must meet the test of proof beyond reasonable doubt.
FACTS:
The Office of the City Prosecutor of Baguio City filed in the RTC two informations against Angngao and
Robert Carlin y Pecdasen, charging them with the illegal sale of marijuana resin and illegal possession of
marijuana hashish oil in violation of Republic Act No. 9165 (Comprehensive Dangerous Drugs Act of 2002).
They were apprehended by a buy-bust operation.

ISSUE: Whether or not the chain of custody was unbroken

RULING:
To ensure a conviction for the illegal sale of dangerous drugs, the following elements constituting the crime
must be present, namely: (a) the identities of the buyer and seller, the object of the sale, and the consideration;
and (b) the delivery of the thing sold and the payment for the thing. Such prosecution for the sale of illegal
drugs requires more than the hasty presentation of evidence to prove each element of the crime. The
presentation of the drugs as evidence in court is indispensable in every prosecution for the illegal sale of
dangerous drugs because the drugs are the corpus delicti of the crime. As such, the State should establish
beyond doubt the identity of the dangerous drugs by showing that the dangerous drugs offered in court as
evidence were the same substances bought during the buy-bust operation. This requirement is complied with by
ensuring that the custody of the seized drugs from the time of confiscation until presentation in court is
safeguarded under what is referred to as the chain of custody by Republic Act No. 9165, whose objective is to
remove unnecessary doubts concerning the identity of the evidence.
The manner and timing of the marking of the seized drugs or related items in accordance with the foregoing
statutory rules are crucial in proving the chain of custody. The marking by the arresting officer of the drugs,
being the starting point in the custodial link, should be made immediately upon the seizure, or, if that is not
possible, as close to the time and place of the seizure as practicable under the obtaining circumstances. This
immediate marking is essential because the succeeding handlers of the drugs would use the markings as their
reference to the seizure, and because it further serves to segregate the marked seized drugs from all other
evidence from the time and point of seizure until the drugs are disposed of at the end of the criminal
proceedings. The deliberate taking of these identifying steps is statutorily aimed at obviating switching,
planting or contamination of the evidence. Verily, the preservation of the chain of custody vis--vis the drugs
ensures the integrity of the evidence incriminating the accused, and fulfills the element of relevancy as a
requisite for the admissibility of the evidence.
The integrity of the evidence presented the corpus delicti no less became suspicious by the mysterious
silence of the record on what transpired after the transaction. An examination of the record indicates that no
testimony on the links in the chain of custody from the time the drugs were confiscated up to the time they were
offered as evidence in court was given by the arresting lawmen and the others who could have handled the
drugs. This omission deprived the lower courts of the means of knowing the details as to every person who
touched the drugs, as to how and from whom the drugs were received, as to where the drugs were at any given
point in that interval, and as to what happened to the drugs while in the possession of each handler, including
the relative condition in which the drugs were received and the state in which they were delivered to the next
links in the chain. It is quite notable that the officers who served as the only witnesses to the buy-bust operation
neither described the precautions taken to ensure that there had been no change in the condition of the drugs nor
specified that there was no opportunity for any person not in the chain to have possession of the drugs.

People of the Philippines vs. Mariano Oandasan Jr.

G. R. No. 194605, June 14, 2016
BERSAMIN, J.
The attack was mounted with treachery because the two conditions in order for this circumstance to be
appreciated concurred, namely: (a) that the means, methods and forms of execution employed gave the person
attacked no opportunity to defend themselves or to retaliate; and ( b) that such means, methods and forms of
execution were deliberately and consciously adopted by the accused without danger to his person. The essence
of treachery lay in the attack that came without warning, and was swift, deliberate and unexpected, affording
the hapless, unarmed and unsuspecting victims no chance to resist, or retaliate, or escape, thereby ensuring the
accomplishment of the deadly design without risk to the aggressor, and without the slightest provocation on the
part of the victims.
FACTS:
Three informations were filed against the accused, two of which were for murder involving the fatal shooting
of Edgardo Tamanu and Danilo Montegrico, and the third was for frustrated homicide involving the nearfatal
shooting of Mario Paleg. RTC convicted the accused which was affirmed by CA.

ISSUE: Whether or not the accused must be acquitted

RULING:
Denial and alibi do not overcome positive identification of the accused
Prosecution witness Ferdinand Cutaran positively identified the accused as the person who had shot
Montegrico. Considering that Cutaran's credibility as an eyewitness was unassailable in the absence of any
showing or hint of ill motive on his part to falsely incriminate the accused, such identification of the accused as
the assailant of Montegrico prevailed over the accused's weak denial and alibi. CA properly rejected the denial
and alibi of the accused as unworthy. Denial and alibi do not prevail over the positive identification of the
accused by the State's witnesses who are categorical and consistent and bereft of ill motive towards the
accused. Denial, unless substantiated by clear and convincing evidence, is undeserving of weight in law for
being negative and self-serving.

Treachery also attended the shooting of Tamanu and Paleg; hence, the accused is guilty of two counts of
murder and one count of frustrated murder
Although the CA and the RTC correctly concluded that the accused had been directly responsible for the
shooting of Tamanu and Paleg, we are perplexed why both lower courts only characterized the killing of
Tamanu and the near-killing of Paleg as homicide and frustrated homicide while characterizing the killing of
Montegrico as murder because of the attendance of treachery. The distinctions were unwarranted. The fact that
the shooting of the three victims had occurred in quick succession fully called for a finding of the attendance of
treachery in the attacks against all the victims. Montegrico, Tamanu and Paleg were drinking together outside
their bunkhouse prior to the shooting when the accused suddenly appeared from the rear of the dump truck,
walked towards their table and shot Montegrico without any warning. That first shot was quickly followed by
more shots. In that situation, none of the three victims was aware of the imminent deadly assault by the
accused, for they were just enjoying their drinks outside their bunkhouse. They were unarmed, and did not
expect to be shot, when the accused came and shot them.
The attack was mounted with treachery because the two conditions in order for this circumstance to be
appreciated concurred, namely: (a) that the means, methods and forms of execution employed gave the person
attacked no opportunity to defend themselves or to retaliate; and ( b) that such means, methods and forms of
execution were deliberately and consciously adopted by the accused without danger to his person. The essence
of treachery lay in the attack that came without warning, and was swift, deliberate and unexpected, affording
the hapless, unarmed and unsuspecting victims no chance to resist, or retaliate, or escape, thereby ensuring the
accomplishment of the deadly design without risk to the aggressor, and without the slightest provocation on the
part of the victims. What was decisive is that the execution of the attack made it impossible for the victims to
defend themselves or to retaliate. Treachery as an aggravating or attendant circumstance must be established
beyond reasonable doubt.
It is of no consequence, therefore, that Cutaran, who had meanwhile fled to safety upon hearing the shot that
had felled Montegrico, did not witness the actual shooting of Tamanu and Paleg; or that Paleg, although
surviving the assault against him and Tamanu, did not testify during the trial. What is of consequence is that the
records unquestionably and reliably showed that Tamanu and Paleg were already prostrate on the ground when
Cutaran returned to the scene; and that the gunshots had been fired in quick succession, thereby proving with
moral certainty that the accused was the same person who also shot Tamanu and Paleg.
As a consequence, the accused was criminally liable for two counts of murder for the fatal shooting of
Montegrico and Tamanu, and for frustrated murder for the near-fatal shooting of Paleg. In the absence of any
modifying circumstances, reclusion perpetua is the penalty for each count of murder, while reclusion temporal
in its medium period is the penalty for frustrated murder. The indeterminate sentence for the frustrated murder
is eight years of prision mayor, as the minimum, to 14 years, eight months and one day of reclusion temporal,
as the maximum

People of the Philippines vs. Edison Magbitang

G. R. No. 175592, June 14, 2016
BERSAMIN, J.:
Every child of sound mind with the capacity to perceive and make known his perception can be believed in the
absence of any showing of an improper motive to testify.
FACTS:
Magbitang was charged with rape with homicide under the information filed by the Provincial Prosecutor of
Nueva Ecija. Seven-year old AAA asked permission from her mother, BBB, to go to a nearby store. BBB
allowed her daughter to leave the house, but the child did not return home. Later that evening, the child's
lifeless body was found by the riverbank. The lone witness to what had befallen AAA was 6year old CCC, who
recalled in court that he and AAA had been playing when Magbitang approached AAA; and that Magbitang
brought AAA to his house. CCC testified on re-direct examination that he had witnessed Magbitang raping
AAA (inasawa), as well as burning her face with a cigarette.

ISSUE: Whether or not CCCs testimony is sufficient to establish the accused guilt

RULING:
Magbitang's contention that CCC, being a child of tender age, was not a competent witness because his
testimony was filled with inconsistencies and suffered from improbabilities was unfounded. Under the Rules
of Court, a child may be a competent witness, unless the trial court determines _upon proper showing that the
child's mental maturity is such as to render him incapable of perceiving the facts respecting which he is to be
examined and of relating the facts truthfully. The testimony of the child of sound mind with the capacity to
perceive and make known the perception can be believed in the absence of any showing of an improper motive
to testify. Once it is established that the child fully understands the character and nature of an oath, the
testimony is given full credence. In the case of CCC, the defense did not persuasively discredit his worthiness
and competence as a witness. As such, the Court considers the reliance by the trial court on his recollection
fully justified.
The evidence of guilt against him consisted in both direct and circumstantial evidence. The direct evidence was
supplied by CCC's testimony, while the circumstantial evidence corroborated CCC's testimony. Such evidence,
combined, unerringly pointed to Magbitang, and to no other, as the culprit.

Pedro Ladines vs. People of the Philippines

G.R. No. 167333, January 11, 2016
BERSAMIN, J.:
To impose the highest within a period of the imposable penalty without specifying the justification for doing so
is an error on the part of the trial court that should be corrected on appeal. In default of such justification, the
penalty to be imposed is the lowest of the period.
FACTS:
An information was filed in the RTC charging the petitioner and one Herman Licup with homicide. While
Prosecution witnesses Philip de Ramon and Mario Lasala, along with victim Erwin de Ramon (Erwin), were
watching the dance held during the June 12, 1993 Grand Alumni Homecoming of the Bulabog Elementary
School in Sorsogon, Sorsogon, the petitioner and Licup appeared and passed by them. The petitioner suddenly
and without warning approached and stabbed Erwin below the navel with a machete. The petitioner then left
after delivering the blow. At that juncture, Licup also mounted his attack against Erwin but the latter evaded the
blow by stepping back. Erwin pulled out the machete from his body and wielded it against Licup, whom he hit
in the chest. Licup pursued but could not catch up with Erwin because they both eventually fell down. Erwin
was rushed to the hospital where he succumbed. RTC pronounced the petitioner guilty of the crime Homicide,
defined and penalized under Article 249 of the Revised Penal Code, sans any mitigating circumstances and
applying the Indeterminate Sentence Law, accused Pedro Ladines is hereby sentenced to suffer an
imprisonment of from Ten (10) years and One (1) day of prision mayor as minimum to 17 years and 4 months
of reclusion temporal as maximum. Petitioner averred that CA committed reversible error in affirming his
conviction despite the admission of Licup immediately after the incident that he had stabbed the victim; and
that the res gestae statement of Licup constituted newly-discovered evidence that created a reasonable doubt as
to the petitioners guilt.

ISSUE: Whether or not the penalty was proper

RULING:
The res gestae statement of Licup did not constitute newly-discovered evidence that created a reasonable doubt
as to the petitioners guilt. The concept of newly-discovered evidence is applicable only when a litigant seeks a
new trial or the re-opening of the case in the trial court. Seldom is the concept appropriate on appeal,
particularly one before the Court. The Court has issued guidelines designed to balance the need of persons
charged with crimes to afford to them the fullest opportunity to establish their defenses, on the one hand, and
the public interest in ensuring a smooth, efficient and fair administration of criminal justice, on the other. The
first guideline is to restrict the concept of newly-discovered evidence to only such evidence that can satisfy the
following requisites, namely: (1) the evidence was discovered after trial; (2) such evidence could not have been
discovered and produced at the trial even with the exercise of reasonable diligence; (3) the evidence is material,
not merely cumulative, corroborative, or impeaching; and (4) the evidence is of such weight that it would
probably change the judgment if admitted. We agree with the State that the proposed evidence of the petitioner
was not newly-discovered because the first two requisites were not present.
Homicide is punished with reclusion temporal. Taking the absence of any modifying circumstances into
consideration, the RTC fixed the indeterminate penalty of 10 years and one day of prision mayor, as minimum,
to 17 years and four months of the medium period of reclusion temporal, as maximum. The CA affirmed the
penalty fixed by the RTC. We declare that the lower courts could not impose 17 years and four months of the
medium period of reclusion temporal, which was the ceiling of the medium period of reclusion temporal, as the
maximum of the indeterminate penalty without specifying the justification for so imposing. They thereby
ignored that although Article 64 of the Revised Penal Code, which has set the rules for the application of
penalties which contain three periods, requires under its first rule that the courts should impose the penalty
prescribed by law in the medium period should there be neither aggravating nor mitigating circumstances, its
seventh rule expressly demands that [w]ithin the limits of each period, the courts shall determine the extent of
the penalty according to the number and nature of the aggravating and mitigating circumstances and the greater
or lesser extent of the evil produced by the crime. By not specifying the justification for imposing the ceiling
of the period of the imposable penalty, the fixing of the indeterminate sentence became arbitrary, or whimsical,
or capricious. In the absence of the specification, the maximum of the indeterminate sentence for the petitioner
should be the lowest of the medium period of reclusion temporal, which is 14 years, eight months and one day
of reclusion temporal.

People of the Philippines vs. Marissa Bayker

G.R. No. 170192, February 10, 2016
BERSAMIN, J.:
An illegal recruiter can be liable for the crimes of illegal recruitment committed in large scale and estafa
without risk of being put in double jeopardy, provided that the accused has been so charged under separate
informations.
FACTS:
Office of the City Prosecutor of Makati filed in the Regional Trial Court (RTC) in Makati a complaint for
Illegal Recruitment and Estafa against the accused.

ISSUE: Did the CA correctly affirm the conviction of the accused-appellant for the crimes of illegal
recruitment in large scale and estafa? Whether or not double jeopardy would attach?

RULING:
Illegal Recruitment Committed in Large Scale
Illegal recruitment is committed by a person who: (a) undertakes any recruitment activity defined under Article
13(b) or any prohibited practice enumerated under Article 34 and Article 38 of the Labor Code; and (b) does
not have a license or authority to lawfully engage in the recruitment and placement of workers. It is committed
in large scale when it is committed against three or more persons individually or as a group. The CA properly
affirmed the conviction of the accused-appellant by the RTC for illegal recruitment committed in large scale
because she had committed acts of recruitment against at least three persons (namely: Canizares, Dahab, and
Miparanum) despite her not having been duly licensed or authorized by the Philippine Overseas Employment
Administration (POEA) for that purpose. The accused-appellant's insistence on her very limited participation in
the recruitment of the complainants did not advance or help her cause any because the State established her
having personally promised foreign employment either as hotel porters or seafarers to the complainants despite
her having no license or authority to recruit from the POEA. The records made it clear enough that her
participation was anything but limited, for she herself had accompanied them to their respective medical
examinations at their own expense. In addition, she herself brought them to GNB Marketing and introduced
them to her co-accused.

The conviction of the accused-appellant for illegal recruitment committed in large scale did not preclude her
personal liability for estafa under Article 315(2)(a) of the Revised Penal Code on the ground of subjecting her
to double jeopardy. The elements of estafa as charged are, namely: ( 1) the accused defrauded another by abuse
of confidence or by means of deceit; and (2) the offended party, or a third party suffered damage or prejudice
capable of pecuniary estimation. In contrast, the crime of illegal recruitment committed in large scale, as
indicated earlier, requires different elements. Double jeopardy could not result from prosecuting and convicting
the accused-appellant for both crimes considering that they were entirely distinct from each other not only from
their being punished under different statutes but also from their elements being different.
The active representation by the accused-appellant of having the capacity to deploy Miparanum abroad despite
not having the authority or license to do so from the POEA constituted deceit as the first element of estafa. Her
representation induced the victim to part with his money, resulting in damage that is the second element of the
estafa.
 A CADEMICUS REVIEW CENTER
Dean Ferdinand A. Tan

LABOR LAW CASES ( 2012 - 2016)

J. BERSAMIN
Philippine Journalists Inc. vs. Journal Employees Union
G.R. No. 192601, June 3, 2013
BERSAMIN, J.:
The coverage of the term legal dependent as used in a stipulation in a collective bargaining agreement (CBA)
granting funeral or bereavement benefit to a regular employee for the death of a legal dependent, if the CBA is
silent about it, is to be construed as similar to the meaning that contemporaneous social legislations have set.
This is because the terms of such social legislations are deemed incorporated in or adopted by the CBA.
FACTS:
Complainant Judith Pulido alleged that she was hired by respondent as proof-reader on 10 January 1991; that
she was receiving a monthly basic salary of P-15,493.66 plus P-155.00 longevity pay plus other benefits
provided by law and their Collective Bargaining Agreement; that on 21 February 2003, as union president, she
sent two letters to President Gloria Arroyo, regarding their complaint of mismanagement being committed by
PIJ executive; that sometime in May 2003, the union was fumished with a letter by Secretary Silvestre Afable,
Jr. head of Presidential Management Staff (PMS), endorsing their letter-complaint to Ombudsman Simeon V.
Marcelo; that respondents took offense and started harassments to complainant union president; that on 30 May
2003, complainant received a letter from respondent Fundador Soriano, International Edition managing editor,
regarding complainants attendance record; that complainant submitted her reply to said memo on 02 June
2003; that on 06 June 2003, complainant received a memorandum of reprimand; that on 04 July 2003,
complainant received another memo from Mr. Soriano, for not wearing her company ID, which she replied the
next day 05 July 2003; that on 04 August 2003, complainant again received a memo regarding complainants
tardiness; that on 05 August 2003, complainant received another memorandum asking her to explain why she
should not be accused of fraud, which she replied to on 07 August 2003; and that on the same day between 3:00
to 4:00 P.M., Mr. Ernesto Estong San Agustin, a staff of HRD handed her termination paper. Complainant
added that in her thirteen (13) years with the company and after so many changes in its management and
executives, she had never done anything that will cause them to issue a memorandum against her or her work
attitude, more so, reasons to terminate her services; that she got dismissed because she was the Union President
who was very active in defending and pursuing the rights of her union members, and in fighting against the
abuses of respondent Corporate Officers; and that she got the ire of respondents when the employees filed a
complaint against the Corporate Officers before Malacaang and which was later indorsed to the Office of the
Ombudsman.
The second complainant Michael L. Alfante alleged that he started to work with respondents as computer
technician at Management Information System under manager Neri Torrecampo on 16 May 2000; that on 15
July 2001, he was regularized receiving a monthly salary of P9,070.00 plus other monetary benefits; that
sometime in 2001, Rico Pagkalinawan replaced Torrecampo, which was opposed by complainant and three
other co-employees; that Pagkalinawan took offense of their objection; that on 22 October 2002, complainant
Alfante received a memorandum from Pagkalinawan regarding his excessive tardiness; that on 10 June 2003,
complainant Alfante received a memorandum from Executive Vice-President Arnold Banares, requiring him to
explain his side on the evaluation of his performance submitted by manager Pagkalinawan; that one week after
complainant submitted his explanation, he was handed his notice of dismissal on the ground of poor
performance; and that complainant was dismissed effective 28 July 2003. Complainant Alfante submitted that
he was dismissed without just cause.
ISSUE: whether or not petitioners denial of respondents claims for funeral and bereavement aid granted
under Section 4, Article XIII of their CBA constituted a diminution of benefits in violation of Article 100 of the
Labor Code.

RULING:
Accordingly, the stipulations, clauses, terms and conditions of the CBA, being the law between the parties,
must be complied with by them. The literal meaning of the stipulations of the CBA, as with every other
contract, control if they are clear and leave no doubt upon the intention of the contracting parties. Here, a
conflict has arisen regarding the interpretation of the term legal dependent in connection with the grant of
funeral and bereavement aid to a regular employee under Section 4, Article XIII of the CBA which stipulates as
follows:
SECTION 4. Funeral/Bereavement Aid. The COMPANY agrees to grant a funeral/bereavement aid in the
following instances:
c. Death of legal dependent of a regular employee P15,000.
It is clear from these statutory definitions of dependent that the civil status of the employee as either married or
single is not the controlling consideration in order that a person may qualify as the employees legal dependent.
What is rather decidedly controlling is the fact that the spouse, child, or parent is actually dependent for support
upon the employee. Considering that existing laws always form part of any contract, and are deemed
incorporated in each and every contract, the definition of legal dependents under the aforecited social
legislations applies herein in the absence of a contrary or different definition mutually intended and adopted by
the parties in the CBA. Accordingly, the concurrence of a legitimate spouse does not disqualify a child or a
parent of the employee from being a legal dependent provided substantial evidence is adduced to prove the
actual dependency of the child or parent on the support of the employee.
In this regard, the differentiation among the legal dependents is significant only in the event the CBA has
prescribed a hierarchy among them for the granting of a benefit; hence, the use of the terms primary
beneficiaries and secondary beneficiaries for that purpose. But considering that Section 4, Article XIII of the
CBA has not included that differentiation, petitioner had no basis to deny the claim for funeral and
bereavement aid of Alfante for the death of his parent whose death and fact of legal dependency on him could
be substantially proved.
Pursuant to Article 100 of the Labor Code, petitioner as the employer could not reduce, diminish, discontinue
or eliminate any benefit and supplement being enjoyed by or granted to its employees. This prohibition against
the diminution of benefits is founded on the constitutional mandate to protect the rights of workers and to
promote their welfare and to afford labor full protection. The application of the prohibition against the
diminution of benefits presupposes that a company practice, policy or tradition favorable to the employees has
been clearly established; and that the payments made by the employer pursuant to the practice, policy, or
tradition have ripened into benefits enjoyed by them. To be considered as a practice, policy or tradition,
however, the giving of the benefits should have been done over a long period of time, and must be shown to
have been consistent and deliberate. It is relevant to mention that we have not yet settled on the specific
minimum number of years as the length of time sufficient to ripen the practice, policy or tradition into a benefit
that the employer cannot unilaterally withdraw.

Nathaniel Dongon vs. Rapid Movers and Forwarders Co. Inc.

G.R. No. 163431, August 28, 2013
BERSAMIN, J.:
The prerogative of the employer to dismiss an employee on the ground or willful disobedience to company
policies must be exercised in good faith and with due regard to the rights of labor.
FACTS:
Petitioner Rapid is engaged in the hauling and trucking business while private respondent Nathaniel T. Dongon
is a former truck helper leadman. Private respondents area of assignment is the Tanduay Otis Warehouse
where he has a job of facilitating the loading and unloading [of the] petitioners trucks. On 23 April 2001,
private respondent and his driver, Vicente Villaruz, were in the vicinity of Tanduay as they tried to get some
goods to be distributed to their clients. Tanduays security guard called the attention of private respondent as to
the fact that Mr. Villaruz was not wearing an Identification Card (I.D. Card). Private respondent, then, assured
the guard that he will secure a special permission from the management to warrant the orderly release of goods.
Instead of complying with his compromise, private respondent lent his I.D. Card to Villaruz; and by reason of
such misrepresentation , private respondent and Mr. Villaruz got a clearance from Tanduay for the release of
the goods. However, the security guard, who saw the misrepresentation committed by private respondent and
Mr. Villaruz, accosted them and reported the matter to the management of Tanduay. On 23 May 2001, after
conducting an administrative investigation, private respondent was dismissed from the petitioning Company.
On 01 June 2001, private respondent filed a Complaint for Illegal Dismissal.

ISSUE: Was the petition improper and dismissible? (2) If the petition could prosper, was the dismissal of
petitioner on the ground of willful disobedience to the company regulation lawful?

RULING:
Petitioner was not guilty of willful disobedience; hence, his dismissal was illegal
Willful disobedience to the lawful orders of an employer is one of the valid grounds to terminate an employee
under Article 296 (formerly Article 282) of the Labor Code.19 For willful disobedience to be a ground, it is
required that: (a) the conduct of the employee must be willful or intentional; and (b) the order the employee
violated must have been reasonable, lawful, made known to the employee, and must pertain to the duties that he
had been engaged to discharge. Willfulness must be attended by a wrongful and perverse mental attitude
rendering the employees act inconsistent with proper subordination. In any case, the conduct of the employee
that is a valid ground for dismissal under the Labor Code constitutes harmful behavior against the business
interest or person of his employer. It is implied that in every act of willful disobedience, the erring employee
obtains undue advantage detrimental to the business interest of the employer. Under the foregoing standards,
the disobedience attributed to petitioner could not be justly characterized as willful within the contemplation of
Article 296 of the Labor Code. He neither benefitted from it, nor thereby prejudiced the business interest of
Rapid Movers. His explanation that his deed had been intended to benefit Rapid Movers was credible. There
could be no wrong or perversity on his part that warranted the termination of his employment based on willful
disobedience.
It is true that an employer is given a wide latitude of discretion in managing its own affairs. The broad
discretion includes the implementation of company rules and regulations and the imposition of disciplinary
measures on its employees. But the exercise of a management prerogative like this is not limitless, but hemmed
in by good faith and a due consideration of the rights of the worker. In this light, the management prerogative
will be upheld for as long as it is not wielded as an implement to circumvent the laws and oppress labor.
Although we recognize the inherent right of the employer to discipline its employees, we should still ensure
that the employer exercises the prerogative to discipline humanely and considerately, and that the sanction
imposed is commensurate to the offense involved and to the degree of the infraction. The discipline exacted by
the employer should further consider the employees length of service and the number of infractions during his
employment. The employer should never forget that always at stake in disciplining its employee are not only
his position but also his livelihood, and that he may also have a family entirely dependent on his earnings.
Considering that petitioners motive in lending his company ID to Villaruz was to benefit Rapid Movers as
their employer by facilitating the loading of goods at the Tanduay Otis Warehouse for distribution to Rapid
Movers clients, and considering also that petitioner had rendered seven long unblemished years of service to
Rapid Movers, his dismissal was plainly unwarranted. The NLRCs reversal of the decision of the Labor
Arbiter by holding that penalty too harsh and disproportionate to the wrong attributed to him was legally and
factually justified, not arbitrary or whimsical.

Samar-Med Distribution vs. NLRC

G.R. No. 162385, July 15, 2013
BERSAMIN, J.:
Although an employer may legally dismiss an employee for a just cause, the non-observance of the
requirements of due process before effecting the dismissal leaves the employer liable for nominal damages.
FACTS:
Samar-Med Distribution, a sole proprietorship registered in the name of Danilo V. Roleda, engaged in the sale
and distribution of intravenous fluids (IVs) in Region VIII (comprised by the several Samar and Leyte
provinces). Gutang was hired for a basic salary of P7,000.00/month and an allowance of P2,000.00/month, and
had the task of supervising the companys sales personnel and sales agents, and of representing Samar-Med in
transactions with the government in Region VIII. Gutang filed a complaint for money claims against
Roleda/Samar-Med in the NLRC. He refiled the complaint on March 4, 1999 because the records were
misplaced. He claimed that Samar-Med had difficulty paying his compensation during his employment,
resulting in his not being paid salaries since November 1995, allowances since June 1994, and commissions
from sales and 13th month pay in 1996; that Samar-Med made illegal deductions in June 1994 and February
1995; that he had no knowledge of any infraction that had caused his dismissal; that he did not receive any
notice informing him of the cessation of Samar-Meds business operations; and that he had been compelled to
look for other sources of income beginning on March 26, 1996 in order to survive. Roleda/Samar-Med denied
liability for Gutangs monetary claims, contending that Gutang was not his employee but an employee of the
City Council of Manila; that Gutang had approached and asked him if he could assist in the operation of the
business of Samar-Med in order to have extra income; that Gutang was thus permitted to sell Samar-Meds
products in his own hometown in Region VIII; that Gutang stopped selling and no longer returned to Manila
after he was tasked to conduct an investigation of the shortage in sales collections;6 that there was no dismissal
of Gutang, to speak of, but abandonment on his part; and that the complaint was a harassment suit to retaliate
for the criminal case he (Roleda) had meanwhile filed against Gutang for misappropriating Samar-Meds funds
totaling P3,302,000.71, as reflected in the demand letter dated May 15, 1996.

ISSUE: Whether or not Gutangs dismissal was a proper issue even if he had not raised it in his complaint; and
on whether or not Gutangs dismissal had been justified on the ground of the latters abandonment and/or
breach of trust and confidence

RULING:
In view of this, Gutangs cause of action should be ascertained not from a reading of his complaint alone but
also from a consideration and evaluation of both his complaint and position paper. With Gutangs position
paper having alleged not only the bases for his money claims, but also that he had been compelled to look for
other sources of income in order to survive and that his employment had not been formally terminated,
thereby entitling him to full backwages aside from his other claims for unpaid monies, the consideration and
ruling on the propriety of Gutangs dismissal by the Labor Arbiter and the NLRC were proper.
The onus of proving that an employee was not dismissed or, if dismissed, his dismissal was not illegal fully
rests on the employer, and the failure to discharge the onus would mean that the dismissal was not justified and
was illegal.15 In Gutangs case, Roleda tendered no showing outside of his mere allegations to substantiate his
averment of abandonment by Gutang. Moreover, although Gutang had undoubtedly stopped working for Samar
Med, his doing so had been for a justifiable reason, consisting in the nonpayment of his salary since November
1995 and his being forced to stop working for Samar Med to enable him to seek employment elsewhere, albeit
temporarily, in order to survive.
Under Article 282(c) of the Labor Code, an employer may terminate an employees employment on the ground
of the latters fraud or wilful breach of the trust and confidence reposed in him. For loss of trust and confidence
to constitute a sufficient ground for termination, the employer must have a reasonable ground to believe, if not
to entertain the moral conviction, that the employee was responsible for the misconduct, and that the nature of
his participation therein rendered him absolutely unworthy of the trust and confidence demanded by his
position. Those requirements were undeniably met in Gutangs case. The finding of a just cause to dismiss
Gutang notwithstanding, we also find that he was not accorded due process. Roleda as the employer had the
obligation to send to him two written notices before finally dismissing him. Article 277 of the Labor Code, as
amended, enunciated this requirement of two written notices.
The first written notice would inform Gutang of the particular acts or omissions for which his dismissal was
being sought. The second written notice would notify him of the employers decision to dismiss him. But the
second written notice must not be made until after he was given a reasonable period after receiving the first
written notice within which to answer the charge, and after he was given the ample opportunity to be heard and
to defend himself with the assistance of his representative, if he so desired. The requirement was mandatory.
Gutangs receipt of the demand letter from Samar-Med to return the amount of P3,302,000.71 was certainly not
even a substantial compliance with the twin-notice requirement, because the purpose of the demand letter was
different from those defined for the sending of the required notices. Nor was he thereby allowed a meaningful
opportunity to be heard or to be notified of his impending termination. The lack of statutory due process would
not nullify the dismissal or render it illegal or ineffectual when the dismissal was for just cause. But the
violation of Gutangs right to statutory due process clearly warranted the payment of indemnity in the form of
nominal damages

D.M. Consunji Corp. vs. Rogelio Bello

G.R. No. 159371, July 29, 2013
BERSAMIN, J.:
For the resignation of an employee to be a viable defense in an action for illegal dismissal, an employer must
prove that the resignation was voluntary, and its evidence thereon must be clear, positive and convincing. The
employer cannot rely on the weakness of the employee's evidence.
FACTS:
Bello brought a complaint for illegal dismissal and damages against DMCI and/or Rachel Consunji. In his
position paper, he claimed that DMCI had employed him as a mason without any interruption from February 1,
1990 until October 10, 1997 at an hourly rate of P25.081; that he had been a very diligent and devoted worker
and had served DMCI as best as he could and without any complaints; that he had never violated any company
rules; that his job as a mason had been necessary and desirable in the usual business or trade of DMCI; that he
had been diagnosed to be suffering from pulmonary tuberculosis, thereby necessitating his leave of absence;
that upon his recovery, he had reported back to work, but DMCI had refused to accept him and had instead
handed to him a termination paper; that he had been terminated due to RSD effective November 5, 1997; that
he did not know the meaning of RSD as the cause of his termination; that the cause had not been explained to
him; that he had not been given prior notice of his termination; that he had not been paid separation pay as
mandated by law; that at that time of his dismissal, DMCIs projects had not yet been completed; and that even
if he had been terminated due to an authorized cause, he should have been given at least one month pay or at
least one-half month pay for every year of service he had rendered, whichever was higher. DMCI contended
that Bello had only been a project employee, as borne out by his contract of employment and appointment
papers.

ISSUE: Whether or not respondent was a regular employee and whether he resigned or was dismissed

RULING:
A project employee is one who is hired for a specific project or undertaking, and the completion or termination
of such project or undertaking has been determined at the time of engagement of the employee. In the context
of the law, Bello was a project employee of DMCI at the beginning of their employer-employee relationship.
The project employment contract they then entered into clearly gave notice to him at the time of his
engagement about his employment being for a specific project or phase of work. He was also thereby notified
of the duration of the project, and the determinable completion date of the project. However, the history of
Bellos appointment and employment showed that he performed his tasks as a mason in DMCIs various
constructions projects. Based on the foregoing, we affirm the CAs conclusion that Bello acquired in time the
status of a regular employee by virtue of his continuous work as a mason of DMCI. The work of a mason like
him a skilled workman working with stone or similar material16 was really related to building or
constructing, and was undoubtedly a function necessary and desirable to the business or trade of one engaged in
the construction industry like DMCI. His being hired as a mason by DMCI in not one, but several of its projects
revealed his necessity and desirability to its construction business. It is settled that the extension of the
employment of a project employee long after the supposed project has been completed removes the employee
from the scope of a project employee and makes him a regular employee.

Lastly, DMCI claims that Bello voluntarily resigned from work. If we were now to outrightly discount her
competence to make that observation, we would disturb the time-honored practice of according respect to the
findings of the first-line trier of facts in order to prefer the speculative and whimsical statement of an appellate
forum like the NLRC. Yet, even had the letter been actually signed by him, the voluntariness of the resignation
could not be assumed from such fact alone. His claim that he had been led to believe that the letter would serve
only as the means of extending his sick leave from work should have alerted DMCI to the task of proving the
voluntariness of the resignation. It was obvious that, if his claim was true, then he did not fully comprehend the
import of the letter, rendering the resignation farcical. The doubt would then be justifiably raised against the
letter being at all intended to end his employment. Under the circumstances, DMCI became burdened with the
obligation to prove the due execution and genuineness of the document as a letter of resignation. We reiterate
that it is axiomatic in labor law that the employer who interposes the defense of voluntary resignation of the
employee in an illegal dismissal case must prove by clear, positive and convincing evidence that the resignation
was voluntary; and that the employer cannot rely on the weakness of the defense of the employee. The
requirement rests on the need to resolve any doubt in favor of the working man.

Manila Jocket Club Inc. vs. Aimee Trajano

G.R. No. 160982, June 26, 2013
BERSAMIN, J.:
An illegally dismissed employee is entitled to her reinstatement without loss of seniority rights and other
privileges, and to full backwages, inclusive of allowances and other benefits or their monetary equivalent.
Should the reinstatement be no longer feasible, an award of separation pay in lieu of reinstatement will be
justified, and the backwages shall be reckoned from the time her wages were withheld until the finality of the
decision.
FACTS:
MJCI had employed Trajano as a selling teller of betting tickets since November 1989. On April 25, 1998, she
reported for work. At around 7:15 p.m., two regular bettors gave her their respective lists of bets (rota) and
money for the bets for Race 14. Although the bettors suddenly left her, she entered their bets in the selling
machine and segregated the tickets for pick up by the two bettors upon their return. Before closing time, one of
the bettors (requesting bettor) returned and asked her to cancel one of his bets worth P2,000.00. Since she was
also operating the negative machine on that day, she obliged and immediately cancelled the bet as requested.
She gave the remaining tickets and the P2,000.00 to the requesting bettor, the money pertaining to the canceled
bet. When Race 14 was completed, she counted the bets received and the sold tickets. She found that the bets
and the tickets balanced. But then she saw in her drawer the receipt for the canceled ticket, but the canceled
ticket was not inside the drawer. Thinking she could have given the canceled ticket to the requesting bettor, she
immediately looked for him but could not find him. It was only then that she remembered that there were two
bettors who had earlier left their bets with her. Thus, she went to look for the other bettor (second bettor) to ask
if the canceled ticket was with him. When she located the second bettor, she showed him the receipt of the
canceled ticket to counter-check the serial number with his tickets. Thereafter, the second bettor returned to
Trajano and told her that it was one of his bets that had been canceled, instead of that of the requesting bettor.
To complicate things, it was also the same bet that had won Race 14. Considering that the bet was for a daily
double, the second bettor only needed to win Race 15 in order to claim dividends. At that point, she realized her
mistake, and explained to the second bettor that the cancellation of his ticket had not been intentional, but the
result of an honest mistake on her part. She offered to personally pay the dividends should the second bettor
win Race 15, which the latter accepted. When Race 15 was completed, the second bettor lost. She was thus
relieved of the obligation to pay any winnings to the second bettor. She was being placed under preventive
suspension effective April 28, 1998, for an unstated period of time. Trajano instituted a complaint for illegal
dismissal.

ISSUE: Whether or not Petitioner MJCI complied with the due process requirement when it effected the
dismissal of Respondent Trajano

RULING:
Loss of the employers trust and confidence is a just cause under Article 282 (c), a provision that ideally applies
only to cases involving an employee occupying a position of trust and confidence, or to a situation where the
employee has been routinely charged with the care and custody of the employers money or property.28 But the
loss of trust and confidence, to be a valid ground for dismissal, must be based on a willful breach of trust and
confidence founded on clearly established facts. Moreover, the loss of trust and confidence must be related to
the employees performance of duties.
As a selling teller, Trajano held a position of trust and confidence. The nature of her employment required her
to handle and keep in custody the tickets issued and the bets made in her assigned selling station. The bets were
funds belonging to her employer. Although the act complained of the unauthorized cancellation of the ticket
(i.e., unauthorized because it was done without the consent of the bettor) was related to her work as a selling
teller, MJCI did not establish that the cancellation of the ticket was intentional, knowing and purposeful on her
part in order for her to have breached the trust and confidence reposed in her by MJCI, instead of being only
out of an honest mistake.

A review of the records warrants a finding that MJCI did not comply with the prescribed procedure. As for the
last procedural requirement of giving the second notice, the posting of the notice of termination at MJCIs
selling stations did not satisfy it, and the fact that Trajano was eventually notified of her dismissal did not cure
the infirmity.

Ma. Lourdes De Jesus vs. Hon. Raul Aquino, Presiding Commissioner of NLRC and Supersonic Services
Inc
G.R. No. 164662, February 18, 2013
BERSAMIN, J.:
The dismissal of an employee for a just or authorized cause is valid despite the employer's non-observance of
the due process of law the Labor Code has guaranteed to the employee. The dismissal is effective against the
employee subject to the payment by the employer of an indemnity.
FACTS:
De Jesus alleged that: she held the position of reservation staff until her illegal dismissal on March 15, 2001,
she held the position of Sales Promotion Officer where she solicited clients for Supersonic and sold plane
tickets to various travel agencies on credit. She had an emergency hysterectomy operation preceded by
continuous bleeding and applied for a sixty-(60) day leave in the meantime. On June 1, 2001, she went to
Supersonic and found the drawers of her desk opened and her personal belongings packed, without her
knowledge and consent; while there, Divina Abad Santos, the companys general manager, asked her to sign a
promissory note and she was also forced to indorse to Supersonic her SSS check in the amount of P25,000.00
which represents her benefits from the hysterectomy operation. There was no notice and hearing nor any
opportunity given her to explain her side prior to the termination of her employment. Supersonic even filed a
case for Estafa against her for her alleged failure to remit collections despite the fact that she had completely
remitted all her collections; and the termination was done in bad faith and in violation of due process.
Petitioner filed with the Labor Arbiter a complaint for illegal dismissal against private respondents Supersonic
Services Inc., Pakistan Airlines, Gil Puyat, Jr. and Divina Abad Santos praying for the payment of separation
pay, full backwages, moral and exemplary damages, etc. Labor Arbiter ruled against De Jesus, declaring her
dismissal to be for just cause and finding that she had been accorded due process of law. NLRC rendered its
Resolution, affirming the Labor Arbiters Decision.

ISSUE: (1) Whether or not Supersonic was justified in terminating De Jesus employment; (2) Whether or not
Supersonic complied with the two-written notice rule; and (3) Whether or not De Jesus was entitled to full
backwages and damages.

RULING: (1) Yes (2) No (3) Yes

Supersonic substantially proved that De Jesus had failed to remit and had misappropriated the amounts she had
collected in behalf of Supersonic. In that regard, the factual findings of the Labor Arbiter and NLRC on the
presence of the just cause for terminating her employment, being already affirmed by the CA, are binding if not
conclusive upon this Court. There being no cogent reason to disturb such findings, the dismissal of De Jesus
was valid. The CA observed that De Jesus had not disputed her failure to remit and account for some of her
collections, for, in fact, she herself had expressly admitted her failure to do so through her letters sent to
Supersonics general manager. Thereby, the CA concluded, she defrauded her employer or willfully violated
the trust reposed in her by Supersonic. In that regard, the CA rightly observed that proof beyond reasonable
doubt of her violation of the trust was not required, for it was sufficient that the employer had reasonable
grounds to believe that the employee concerned is responsible for the misconduct as to be unworthy of the trust
and confidence demanded by [her] position.

Supersonic had not complied with the two-written notice rule. The first written notice would inform her of the
particular acts or omissions for which her dismissal was being sought. The second written notice would notify
her of the employers decision to dismiss her. But the second written notice must not be made until after she
was given a reasonable period after receiving the first written notice within which to answer the charge, and
after she was given the ample opportunity to be heard and to defend herself with the assistance of her
representative, if she so desired. The requirement was mandatory. The memorandum sent by Supersonic did not
specify the grounds for which her dismissal would be sought, and for that reason was at best a mere reminder to
De Jesus to submit her report on the status of her accounts. The second memo did not provide the notice of
dismissal under the law because it only directed her to explain why she should not be dismissed for cause. The
latter memorandum was apparently only the first written notice under the requirement.

The violation by Supersonic of the two-written notice requirement rendered ineffectual the dismissal of De
Jesus for just cause under Article 282 of the Labor Code, and entitled her to be paid full backwages from the
time of her dismissal until the finality of its decision.

Lepanto Consolidated Mining Company vs. The Lepanto Capataz Union

G.R. No. 157086, February 18, 2013
BERSAMIN, J:
Capatazes are not rank-and-file employees because they perform supervisory functions for the management;
hence, they may form their own union that is separate and distinct from the labor organization of rank-and-file
employees.
FACTS:
Respondent Lepanto Capataz Union, a labor organization duly registered with DOLE, filed a petition for
consent election with the Industrial Relations Division of the Cordillera Regional Office (CAR) of DOLE,
thereby proposing to represent 139 capatazes of Lepanto. Lepanto opposed the petition, contending that the
Union was in reality seeking a certification election, not a consent election, and would be thereby competing
with the Lepanto Employees Union (LEU), the current collective bargaining agent. Lepanto pointed out that the
capatazes were already members of LEU, the exclusive representative of all rank-and-file employees of its
Mine Division. Med-Arbiter Michaela A. Lontoc of DOLE-CAR issued a ruling to the effect that the capatazes
could form a separate bargaining unit due to their not being rank-and-file employees. DOLE Undersecretary
Rosalinda DimapilisBaldoz (Baldoz), acting by authority of the DOLE Secretary, affirmed the ruling of Med-
Arbiter Lontoc. In the ensuing certification election, the Union garnered 109 of the 111 total valid votes cast.
On the day of the certification election, however, Lepanto presented an opposition/protest. Med-Arbiter
Florence Marie A. Gacad-Ulep of DOLE-CAR rendered a decision certifying the Union as the sole and
exclusive bargaining agent of all capatazes of Lepanto.

ISSUE: Whether the capatazes could form their own union independently of the rank-and-file employees.

RULING: Yes
We cannot undo the affirmance by the DOLE Secretary of the correct findings of her subordinates in the
DOLE, an office that was undeniably possessed of the requisite expertise on the matter in issue. In dealing with
the matter, her subordinates in the DOLE fairly and objectively resolved whether the Union could lawfully seek
to be the exclusive representative of the bargaining unit of capatazes in the company. Their factual findings,
being supported by substantial evidence, are hereby accorded great respect and finality. In any event, we affirm
that capatazes or foremen are not rank-and-file employees because they are an extension of the management,
and as such they may influence the rank-and-file workers under them to engage in slowdowns or similar
activities detrimental to the policies, interests or business objectives of the employers.

Lolita Concepcion vs. Minex Import Corp.

G.R. No. 153569, January 24, 2012

BERSAMIN, J.:

The employer may validly dismiss for loss of trust and confidence an employee who commits an act of fraud
prejudicial to the interest of the employer. Neither a criminal prosecution nor a conviction beyond reasonable
doubt for the crime is a requisite for the validity of the dismissal. Nonetheless, the dismissal for a just or lawful
cause must still be made upon compliance with the requirements of due process under the Labor Code;
otherwise, the employer is liable to pay nominal damages as indemnity to the dismissed employee.

FACTS:
Respondent Minex Import-Export Corporation (Minex) engaged in the retail of semi-precious stones, selling
them in kiosks or stalls installed in various shopping centers within Metro Manila. It employed the petitioner
initially as a salesgirl, rotating her assignment among nearly all its outlets. It made her a supervisor in July
1997, but did not grant her any salary increase. On October 23, 1997, respondent Vina Mariano, an Assistant
Manager of Minex, assigned the petitioner to the SM Harrison Plaza kiosk with the instruction to hold the keys
of the kiosk. Working under her supervision there were salesgirls Cristina Calung and Lida Baquilar. Petitioner
and her salesgirls had sales of crystal items totaling P39,194.50. At the close of business that day, they
conducted a cash-count of their sales proceeds, including those from the preceding Friday and Saturday, and
determined their total for the three days to be P50,912.00. The petitioner wrapped the amount in a plastic bag
and deposited it in the drawer of the locked wooden cabinet of the kiosk. Petitioner phoned Vina Mariano to
report that the P50,912.00 was missing, explaining how she and her salesgirls had placed the wrapped amount
at the bottom of the cabinet the night before, and how she had found upon reporting to work that morning that
the contents of the cabinet were in disarray and the money already missing.

Petitioner complained against the respondents for illegal dismissal in the Department of Labor and
Employment. Minex, through Vina, filed a complaint for qualified theft against the petitioner in the Office of
the City Prosecutor in Manila. Assistant Prosecutor rendered a resolution finding probable cause for qualified
theft and recommending the filing of an information against the petitioner. Thus, she was charged with
qualified theft in the Regional Trial Court (RTC) in Manila. As to the petitioners complaint for illegal
dismissal, Labor Arbiter Jose G. de Vera rendered his decision in favor of the complainant. The National Labor
Relations Commission (NLRC) reversed the decision of the Labor Arbiter, declaring that the petitioner had not
been dismissed, but had abandoned her job after being found to have stolen the proceeds of the sales

ISSUE: Whether or not the petitioner was terminated for a just and valid cause.

RULING: Yes
To dismiss an employee, the law requires the existence of a just and valid cause. Article 282 of the Labor
Code enumerates the just causes for termination by the employer: (a) serious misconduct or willful
disobedience by the employee of the lawful orders of his employer or the latters representative in connection
with the employees work; (b) gross and habitual neglect by the employee of his duties; (c) fraud or willful
breach by the employee of the trust reposed in him by his employer or his duly authorized representative; (d)
commission of a crime or offense by the employee against the person of his employer or any immediate
member of his family or his duly authorized representative; and (e) other causes analogous to the foregoing.
The NLRC held that the termination of the petitioner was due to loss of trust and confidence. It has been raised
and rejected many times before on the basis that neither conviction beyond reasonable doubt for a crime against
the employer nor acquittal after criminal prosecution was indispensable. Nor was a formal charge in court for
the acts prejudicial to the interest of the employer a pre-requisite for a valid dismissal.
Indeed, the employer is not expected to be as strict and rigorous as a judge in a criminal trial in
weighing all the probabilities of guilt before terminating the employee. The quantum of proof required for
convicting an accused is thus higher proof of guilt beyond reasonable doubt than the quantum prescribed
for dismissing an employee substantial evidence. It is also unfair to require an employer to first be morally
certain of the guilt of the employee by awaiting a conviction before terminating him when there is already
sufficient showing of the wrongdoing. Requiring that certainty may prove too late for the employer, whose loss
may potentially be beyond repair. Here, no less than the DOJ Secretary found probable cause for qualified theft
against the petitioner. That finding was enough to justify her termination for loss of confidence.
The petitioner plainly demonstrated how quickly and summarily her dismissal was carried out without
first requiring her to explain anything in her defense as demanded under Section 2 (d) of Rule I of
the Implementing Rules of Book VI of the Labor Code. Instead, the respondents forthwith had her arrested and
investigated by the police authorities for qualified theft. This, we think, was a denial of her right to due process
of law, consisting in the opportunity to be heard and to defend herself. In view of the foregoing, we impose on
the respondents the obligation to pay to the petitioner an indemnity in the form of nominal damages
of P30,000.00.

Charlie Jao vs. BCC Products Sales Inc. and Terrance Ty

G.R. No. 163700, April 18, 2012
BERSAMIN, J.:
In determining the presence or absence of an employer-employee relationship, the Court has consistently
looked for the following incidents, to wit: (a) the selection and engagement of the employee; (b) the payment of
wages; (c) the power of dismissal; and (d) the employers power to control the employee on the means and
methods by which the work is accomplished. The last element, the so-called control test, is the most important
element.
FACTS:
Petitioner maintained that respondent BCC Product Sales Inc. and its President, respondent Terrance Ty,
employed him as comptroller starting from September 1995 with a monthly salary of P20,000.00 to handle the
financial aspect of BCCs business; that on October 19,1995, the security guards of BCC, acting upon the
instruction of Ty, barred him from entering the premises of BCC where he then worked; that his attempts to
report to work in November and December 12, 1995 were frustrated because he continued to be barred from
entering the premises of BCC; and that he filed a complaint dated December 28, 1995 for illegal dismissal,
reinstatement with full backwages, non-payment of wages, damages and attorneys fees. Respondents countered
that petitioner was not their employee but the employee of Sobien Food, the major creditor and supplier of
BCC; and that SFC had posted him as its comptroller in BCC to oversee BCCs finances and business
operations and to look after SFCs interests or investments in BCC

ISSUE: Whether petitioner was respondents employee or not

RULING: No
The statements of So really supported respondents position in that petitioners association with SFC
prior to his supposed employment by BCC went beyond mere acquaintance with So. That So, who had earlier
merely retained petitioner as his accountant, thereafter employed petitioner as a retained accountant after his
supposed illegal dismissal by BCC raised a doubt as to his employment by BCC, and rather confirmed
respondents assertion of petitioner being an employee of SFC while he worked at BCC.
Moreover, in determining the presence or absence of an employer-employee relationship, the Court has
consistently looked for the following incidents, to wit: (a) the selection and engagement of the employee; (b)
the payment of wages; (c) the power of dismissal; and (d) the employers power to control the employee on the
means and methods by which the work is accomplished. The last element, the so-called control test, is the most
important element.
It can be deduced from the March 1996 affidavit of petitioner that respondents challenged his authority to
deliver some 158 checks to SFC. Considering that he contested respondents challenge by pointing to the
existing arrangements between BCC and SFC, it should be clear that respondents did not exercise the power of
control over him, because he thereby acted for the benefit and in the interest of SFC more than of BCC.

In addition, petitioner presented no document setting forth the terms of his employment by BCC. The failure to
present such agreement on terms of employment may be understandable and expected if he was a common or
ordinary laborer who would not jeopardize his employment by demanding such document from the employer,
but may not square well with his actual status as a highly educated professional. Also, his name did not appear
in the payroll of BCC despite him having approved the payroll as comptroller.
Lastly, the confusion about the date of his alleged illegal dismissal provides another indicium of the insincerity
of petitioners assertion of employment by BCC. In the petition for review on certiorari, he averred that he had
been barred from entering the premises of BCC on October 19, 1995, and thus was illegally dismissed. Yet, his
complaint for illegal dismissal stated that he had been illegally dismissed on December 12, 1995 when
respondents security guards barred him from entering the premises of BCC, causing him to bring his complaint
only on December 29, 1995, and after BCC had already filed the criminal complaint against him. The wide gap
between October 19, 1995 and December 12, 1995 cannot be dismissed as a trivial inconsistency considering
that the several incidents affecting the veracity of his assertion of employment by BCC earlier noted herein
transpired in that interval.

Crisanto Castro, Jr. vs. Ateneo de Naga University, Fr. Joel Tabora et al
G.R. No. 175293, July 23, 2014
BERSAMIN, J.:
All doubts in the interpretation and implementation of labor laws should be resolved in favor of labor. In ruling
that an order or award for reinstatement does not require a writ of execution, the Court is simply adhering and
giving meaning to this rule.
FACTS:
The petitioner started his employment with respondent Ateneo de Naga University (University) in the first
semester of school year 1960-1961. At the time of his dismissal, he was a regular and full-time faculty member
of the Universitys Accountancy Department in the College of Commerce. Allegedly, he received a letter from
the University President, informing him that his contract (which was set to expire on May 31, 2000) would no
longer be renewed. After several attempts to discuss the matter with Fr. Tabora in person, and not having been
given any teaching load or other assignments , he brought his complaint for illegal dismissal.
Labor Arbiter Quiones ruled in favor of the petitioner. Aggrieved, the respondents appealed to the NLRC. In
his order dated October 10, 2002, LA Quiones directed respondents to exercise their option of whether
complainant is to be actually reinstated, or be reinstated in the payroll within ten (10) days from receipt of this
order. Failure to exercise such option within the period provided shall render complainants motion for accrued
salaries appropriate.
Dissatisfied, the petitioner filed a notice of partial appeal, but the notice was denied due course on June 30,
2003. The petitioner elevated the matter to the CA by petition for certiorari. In the interim, on June 26, 2004,
the petitioner executed a receipt and quitclaim in favor of the University respecting his claim for the benefits
under the Plan.
Meanwhile, the NLRC rendered its decision affirming with modification the ruling of the LA on the
petitioners illegal dismissal case. On motion for reconsideration, the NLRC reversed its ruling on August 31,
2005 holding that the execution of the receipt and quitclaim respecting his benefits under the Plan estopped the
petitioner from pursuing other claims. The CA dismissed the petitioners petition for certiorari on the ground
of its having been rendered moot and academic by the aforecited August 31, 2005 decision of the NLRC.Upon
denial of his motion for reconsideration, the petitioner appeals.

ISSUES:
Whether or not the petitioners claim for the payment of accrued salaries and benefits for the period that he was
not reinstated was rendered moot and academic by: his receipt of the retirement benefits and execution of the
corresponding receipt and quitclaim in favor of the respondents; and the dismissal of his complaint for illegal
dismissal by the NLRC.
Whether or not the petitioners claim for accrued salaries from the time of the issuance of the order of
reinstatement by LA Quinones until his actual reinstatement in November 2002 was rendered moot and
academic by the reversal of the decision of the LA.

RULING:
Execution of the receipt and quitclaim was not a settlement of the petitioners claim for accrued salaries

The text of the receipt and quitclaim was clear and straightforward, and it was to the effect that the sum
received by the petitioner represented full payment of benefits pursuant to the Employees retirement plan.
As such, both the NLRC and the CA should have easily seen that the quitclaim related only to the settlement of
the retirement benefits, which benefits could not be confused with the reliefs related to the complaint for illegal
dismissal.
Worthy to stress is that retirement is of a different species from the reliefs awarded to an illegally dismissed
employee. Retirement is a form of reward for an employees loyalty and service to the employer, and is
intended to help the employee enjoy the remaining years of his life, and to lessen the burden of worrying about
his financial support or upkeep. In contrast, the reliefs awarded to an illegally dismissed employee are in
recognition of the continuing employer-employee relationship that has been severed by the employer without
just or authorized cause, or without compliance with due process.

Claim for accrued benefits should be sustained despite dismissal of the petitioners complaint

Article 279 of the Labor Code, as amended, entitles an illegally dismissed employee to reinstatement. Article
223 of the Labor Code requires the reinstatement to be immediately executory even pending appeal. In Pioneer
Texturizing Corporation v. National Labor Relations Commission, the Court has further observed: The
provision of Article 223 is clear that an award for reinstatement shall be immediately executory even pending
appeal and the posting of a bond by the employer shall not stay the execution for reinstatement. The legislative
intent is quite obvious, i.e., to make an award of reinstatement immediately enforceable, even pending appeal.
To require the application for and issuance of a wit of execution as prerequisites for the execution of a
reinstatement award would certainly betray and run counter to the very object and intent of Article 223, i.e., the
immediate execution of a reinstatement order. The reason is simple. An application for a writ of execution and
its issuance could be delayed for numerous reasons.
Furthermore, the rule is that all doubts in the interpretation and implementation of labor laws should be
resolved in favor of labor. In ruling that an order or award for reinstatement does not require a writ of
execution, the Court is simply adhering and giving meaning to this rule. Henceforth, we rule that an award or
order for reinstatement is self-executory.

The Court holds that the order of reinstatement of the petitioner was not rendered moot and academic. He
remained entitled to accrued salaries from notice of the LAs order of reinstatement until reversal thereof.
Considering that the respondents reinstated the petitioner only in November 2002, and that their inability to
reinstate him was without valid ground, they were liable to pay his salaries accruing from the time of the
decision of the LA (i.e., September 3, 2001) until his reinstatement in November 2002. It did not matter that the
respondents had yet to exercise their option to choose between actual or payroll reinstatement at that point
because the order of reinstatement was immediately executory.

National Wages and Productivity Commission and the Regional Tripartite Wages and Productivity
Board vs. Alliance of Progressive Labor and the Tunay na Nagkakaisang Manggagawa sa Royal
G.R. No. 150326, March 12, 2014
BERSAMIN, J.:
NWPC had the authority to prescribe the rules and guidelines for the determination of the minimum wage and
productivity measures, and the RTWPBNCR had the power to issue wage orders.
FACTS:
In order to rationalize wages throughout the Philippines, Republic Act No. 6727 created the NWPC and the
RTWPBs of the different regions. Consequently, the RTWPBNCR issued Wage Order No. NCR07 on
October 14, 1999 imposing an increase of P25.50/day on the wages of all private sector workers and employees
in the NCR and pegging the minimum wage rate in the NCR at P223.50/day. However, Section 2 and Section 9
of Wage Order No. NCR07 exempted certain sectors and industries from its coverage.
Feeling aggrieved by their noncoverage by the wage adjustment, the Alliance of Progressive Labor and the
Tunay na Nagkakaisang Manggagawa sa Royal filed an appeal with the NWPC assailing Section 2(A) and
Section 9(2) of Wage Order No. NCR07. The NWPC upheld the validity of Section 2(A) and Section 9(2) of
Wage Order No. NCR07. It observed that the RTWPBs power to determine exemptible categories was
adjunct to its wage fixing function conferred by Article 122(e) of the Labor Code, as amended by Republic Act
No. 6727; that such authority of the RTWPB was also recognized in NWPC Guidelines No. 01, Series of 1996.
With regard to the excluded sectors provided for in Section 2(A) of Wage Order No. NCR07, the NWPC took
cognizance of the precarious situation in the Philippines in 1997 because of the Asian economic turmoil that
had prompted the RTWPBNCR to issue Wage Order No. NCR06.
Accordingly, the NWPC denied the appeal of APL and TNMR for its lack of merit.The APL and TNMR
assailed the decisions of the NWPC on certiorari in the CA which was granted by the latter, holding that the
powers and functions of the NWPC and RTWPBNCR as set forth in Republic Act No. 6727 did not include
the power to grant additional exemptions from the adjusted minimum wage.

ISSUES:
Whether or not the RTWPBNCR had the authority to provide additional exemptions from the minimum wage
adjustments embodied in Wage Order No. NCR07;
Whether or not Wage Order No. NCR07 complied with the requirements set by NWPC Guidelines No. 01,
Series of 1996.

RULING: YES
Indisputably, the NWPC had the authority to prescribe the rules and guidelines for the determination of the
minimum wage and productivity measures, and the RTWPBNCR had the power to issue wage orders.
Pursuant to its statutorily defined functions, the NWPC promulgated NWPC Guidelines No. 00195 (Revised
Rules of Procedure on Minimum Wage Fixing) to govern the proceedings in the NWPC and the RTWPBs in the
fixing of minimum wage rates by region, province and industry. Section 1 of Rule VIII of NWPC Guidelines
No. 00195 recognized the power of the RTWPBs to issue exemptions from the application of the wage orders
subject to the guidelines issued by the NWPC.
Pursuant to the above, the following categories of establishments may be exempted upon application with and
as determined by the Board, in accordance with applicable criteria on exemption as provided in this
Guidelines; provided further that such categories are expressly specified in the Order: 1. Distressed
establishments;2. New business enterprises (NBEs);3. Retail/Service establishments employing not more than
ten (10) workers;4. Establishments adversely affected by natural calamities. Exemptible categories outside of
the abovementioned list may be allowed only if they are in accord with the rationale for exemption. The
concerned Regional Board shall submit strong and justifiable reason/s for the inclusion of such categories
which shall be subject to review/approval by the Commission.
Under the guidelines, the RTWPBs could issue exemptions from the application of the wage orders as long as
the exemptions complied with the rules of the NWPC. In its rules, the NWPC enumerated four exemptible
establishments, but the list was not exclusive. The RTWPBs had the authority to include in the wage orders
establishments that belonged to, or to exclude from the four enumerated exemptible categories. If the exempted
category was one of the listed ones, the RTWPB issuing the wage order must see to it that the requisites stated
in Section 3 and Section 4 of the NWPC Guidelines No. 01, Series of 1996 were complied with before granting
fully or partially the application of an establishment seeking to avail of the exemption.
On the other hand, if the exemption was outside of the four exemptible categories, like here, the exemptible
category should be: (1) in accord with the rationale for exemption; (2) reviewed/approved by the NWPC; and
(3) upon review, the RTWPB issuing the wage order must submit a strong and justifiable reason or reasons for
the inclusion of such category. It is the compliance with the second requisite that is at issue here. The very fact
that the validity of the assailed sections of Wage Order No. NCR07 had been already passed upon and upheld
by the NWPC meant that the NWPC had already given the wage order its necessary legal imprimatur.
Accordingly, the requisite approval or review was complied with.
In creating the RTWPBs, Congress intended to rationalize wages, firstly, by establishing full time boards to
police wages roundtheclock, and secondly, by giving the boards enough powers to achieve this objective. In
the nature of their functions, the RTWPBs investigate and study all the pertinent facts to ascertain the
conditions in their respective regions. Hence, they are logically vested with the competence to determine the
applicable minimum wages to be imposed as well as the industries and sectors to exempt from the coverage of
their wage orders.
Lastly, Wage Order No. NCR07 is presumed to be regularly issued in the absence of any strong showing of
grave abuse of discretion on the part of RTWPBNCR. The presumption of validity is made stronger by the
fact that its validity was upheld by the NWPC upon review.

Mega Magazine Inc. Jerry Tiu and Sarita Yap vs. Margaret Defensor
G.R. No. 162021, June 16, 2014
BERSAMIN, J.:
The grant of a bonus or special incentive, being a management prerogative, is not a demandable and
enforceable obligation, except when the bonus or special incentive is made part of the wage, salary or
compensation of the employee, or is promised by the employer and expressly agreed upon by the parties. If the
desired goal of production or actual work is not accomplished, the bonus does not accrue.
FACTS:
Petitioner Mega Magazine Publications, Inc. first employed the respondent as an Associate Publisher, and later
promoted her as a Group Publisher. In a memorandum dated February 25, 1999, the respondent proposed to
MMPIs Executive Vice-President Yap year-end commissions for herself and a special incentive plan for the
Sales Department. Yap made marginal notes of her counter-proposals on her copy of the respondents
memorandum crossing out proposed items 1 and 2(1. MMPI Total revenue at P28-P29 P5,000 each by year
end;2. MMPI Total revenue at P30-P37 P7,000 each by year end), from the schedule of the respondents
commissions, and proposing instead that outright commissions be at 0.1% of P35-P38 million. The respondent
sent another memorandum setting out the 1999 advertisement sales, target and commissions, and proposing that
the schedule of her outright commissions should start at .05% of P34.5 million total revenue, or P175,000.00;
and further proposing that the special incentives be given when total revenues reached P35-P38 million. On
August 31, 1999, the respondent sent Yap a report on sales and sales targets.
On October 1999, the respondent tendered her letter of resignation. Yap accepted the resignation.
Before leaving MMPI, the respondent sent Yap another report on the sales and advertising targets for 1999.
Yap responded with a formalization of her approval of the 1999 special incentive scheme proposed by the
respondent through her memorandum dated February 25, 1999, revising anew the schedule by starting
commissions at .05% of P35-P38 million gross advertising revenue (including barter), and the proposed special
incentives at P35-P38 million with P8,500.00 bonus.
The respondent replied to Yap, pointing out that her memorandum dated April 5, 1999 had been the
result of Yaps own comments on the special incentive scheme she had proposed, and that she had assumed that
Yap had been amenable to the proposal when she did not receive any further reaction from the latter. On May
2000, the respondent filed a complaint for payment of bonus and incentive compensation with damages. The
Labor Arbiter (LA) dismissed the respondents complaint, ruling that the respondent had not presented any
evidence showing that MMPI had agreed or committed to the terms proposed in her memorandum of April 5,
1999. The respondent appealed, but the NLRC denied the appeal for its lack of merit.The respondent brought a
special civil action for certiorari in the CA. the CA dismissed the respondents petition for certiorari and
upheld the resolutions of the NLRC. On motion for reconsideration, however, the CA promulgated its assailed
amended decision granting the motion for reconsideration and giving due course to the respondents petition
for certiorari; annulling the challenged resolutions of the NLRC; and remanding the case to the NLRC for the
reception of additional evidence. Hence, this appeal by petition for review on certiorari.

ISSUES:
Whether or not the respondent was entitled to the commissions and the incentive bonus being claimed.
Whether or not a remand of the case to the NLRC for further reception of evidence is justified.

RULING:
The appeal is partly meritorious.
The grant of a bonus or special incentive, being a management prerogative, is not a demandable and
enforceable obligation, except when the bonus or special incentive is made part of the wage, salary or
compensation of the employee, or is promised by the employer and expressly agreed upon by the parties. If the
desired goal of production or actual work is not accomplished, the bonus does not accrue. Due to the nature of
the bonus or special incentive being a gratuity or act of liberality on the part of the giver, the respondent could
not validly insist on the schedule proposed in her memorandum of April 5, 1999 considering that the grant of
the bonus or special incentive remained a management prerogative. However, the Court agrees with the CAs
ruling that the petitioners had already exercised the management prerogative to grant the bonus or special
incentive. At no instance did Yap flatly refuse or reject the respondents request for commissions and the bonus
or incentive. This is plain from the fact that Yap even bargained with the respondent on the schedule of the
rates and the revenues on which the bonus or incentive would be pegged.

Concerning the remand of the case to the NLRC for reception of additional evidence at the instance of the
respondent, we hold that the CA committed a reversible error. Although, as a rule, the submission to the NLRC
of additional evidence like documents and affidavits is not prohibited, so that the NLRC may properly consider
such evidence for the first time on appeal, the circumstances of the case did not justify the application of the
rule herein. The additional evidence the respondent has sought to be admitted (i.e., Tabingos affidavit executed
on October 14, 2002) was already attached to the pleadings filed in the NLRC.
Confronted with the conflicting claims on MMPIs gross revenue realized in 1999, the question is which
evidence must be given more weight? The resolution of the question requires the re-examination and
calibration of evidence. Such re-examination and calibration, being of a factual nature, ordinarily lies beyond
the purview of the Courts authority in this appeal. Yet, because the documents are already before the Court, we
hereby treat the situation as an exception in order to resolve the question promptly and finally instead of still
remanding the case to the CA for the re- evaluation and calibration. We start by observing that the degree of
proof required in labor cases is not as stringent as in other types of cases. This liberal approach affords to the
employee every opportunity to level the playing field in which her employer is pitted against her.
In labor cases, the rules on the degree of proof are enforced not as stringently as in other cases in order to
better serve the higher ends of justice. This lenity is intended to afford to the employee every opportunity to
level the playing field. Moreover, whenever the evidence presented by the employer and that by the employee
are in equipoise, the scales of justice must tilt in favor of the latter. Accordingly, the Court concludes that the
respondent was entitled to her 0.05% outright commissions and to the special incentive bonus of P8, 500.00
based on MMPI having reached the minimum target of P35 million in gross revenues as provided in Yaps
memorandum of December 8, 1999.

Netlink Computer Incorporated vs. Eric Delmo

G.R. No. 160827, June 18, 2014
BERSAMIN, J.:
FACTS:
Netlink Computer, Inc. Products and Services hired Eric S. Delmo as account manager. He was able to generate
sales from which he earned commissions amounting to P993,558.89 and US$7,588.30. He then requested
payment of his commissions, but Netlink refused and only gave him partial cash advances chargeable to his
commissions. Later on, Netlink began to nitpick and fault find, like stressing his supposed absences and
tardiness. In order to force him to resign, Netlink issued several memoranda detailing his supposed infractions
of the companys attendance policy. Despite the memoranda, Delmo continued to generate huge sales for
Netlink.
On November 28, 1996, Delmo was shocked when he was refused entry into the company premises by
the security guard pursuant to a memorandum to that effect. This incident prompted Delmo to file a complaint
for illegal dismissal. The Labor Arbiter ruled against Netlink and in favor of Delmo. On appeal, the National
Labor Relations Commission modified the decision of the Labor Arbiter by setting aside the backwages and
reinstatement decreed by the Labor Arbiter due to the existence of valid and just causes for the termination of
Delmos employment. On May 9, 2003, the CA promulgated its assailed decision upholding the NLRCs
ruling subject to modifications. Hence, this appeal. Netlink submits that the CA committed a palpable and
reversible error of law in not holding that the applicable exchange rate for computing the US dollar
commissions of Delmo should be the rates prevailing at the time when the sales were actually generated, not
the rates prevailing at the time of the payment; and in awarding attorneys fees.

ISSUES:
Whether or not the payment of the commissions should be in US dollars. Whether or not the award of
attorneys fees was warranted.

RULING:
In the absence of a written agreement between the employer and the employee that sales commissions
shall be paid in a foreign currency, the latter has the right to be paid in such foreign currency once the same
has become an established practice of the former. The rate of exchange at the time of payment, not the rate
of exchange at the time of the sales, controls.
As a general rule, all obligations shall be paid in Philippine currency. However, the contracting parties may
stipulate that foreign currencies may be used for settling obligations. This is pursuant to Republic Act No. 8183
which provides as follows: Section 1. All monetary obligations shall be settled in the Philippine currency which
is legal tender in the Philippines. However, the parties may agree that the obligation or transaction shall be
settled in any other currency at the time of payment.
There was no written contract between Netlink and Delmo stipulating that the latters commissions would be
paid in US dollars. The absence of the contractual stipulation notwithstanding, Netlink was still liable to pay
Delmo in US dollars because the practice of paying its sales agents in US dollars for their US dollar-
denominated sales had become a company policy. This was impliedly admitted by Netlink when it did not
refute the allegation that the commissions earned by Delmo and its other sales agents had been paid in US
dollars. Instead of denying the allegation, Netlink only sought a declaration that the US dollar commissions be
paid using the exchange rate at the time of sale. The principle of non-diminution of benefits, which has been
incorporated in Article 100 of the Labor Code, forbade Netlink from unilaterally reducing, diminishing,
discontinuing or eliminating the practice. Verily, the phrase supplements, or other employee benefits in
Article 100 is construed to mean the compensation and privileges received by an employee aside from regular
salaries or wages.
With regard to the length of time the company practice should have been observed to constitute a voluntary
employer practice that cannot be unilaterally reduced, diminished, discontinued or eliminated by the employer,
we find that jurisprudence has not laid down any rule requiring a specific minimum number of years. With the
payment of US dollar commissions having ripened into a company practice, there is no way that the
commissions due to Delma were to be paid in US dollars or their equivalent in Philippine currency determined
at the time of the sales. To rule otherwise would be to cause an unjust diminution of the commissions due and
owing to Delma.

Finally, we affirm the following justification of the CA in granting attorney's fees to Delma. In line of the
decision of the Supreme Court in the case of Consolidated Rural Bank vs. National Labor Relations
Commission where it was held that "in actions for recovery of wages or where an employee was forced to
litigate and thus incur expenses to protect her rights and interests, even if not so claimed, an award of attorney's
fees equivalent to ten percent (10%) of the total award is legally and morally justifiable. There is no doubt that
in the present case, the private respondent has incurred expenses for the protection and enforcement of his right
to his commissions.
Rosalie Gargoles vs. Reylita Del Rosario
G.R. No. 158583, September 10, 2014
BERSAMIN, J.:
The just and valid causes for the dismissal of an employee, as enumerated in Article 282 of the Labor Code,
include: (a) serious misconduct or willful disobedience by the employee of the lawful orders of his employer or
representative in connection with her work; (b) gross and habitual neglect by the employee of her duties;
(c) fraud or willful breach by the employee of the trust reposed in her by her employer or duly authorized
representative; (d) commission of a crime or offense by the employee against the person of her employer or any
immediate member of her family or her duly authorized representative; and (e) other causes analogous to the
foregoing.
FACTS:
On February 20, 1992, the petitioner started working as an all-around employee acting as cashier,
sales clerk, xerox operator, janitress, photo printer, and messenger/delivery person at Jay-Annes One Hour
Photo Shop. On March 28, 1998, the petitioner received a letter terminating her employment for dishonesty.
As a result, she lodged a complaint for illegal dismissal, seeking her reinstatement and backwages. In his
decision, Labor Arbiter Ramos, Jr. dismissed the petitioners complaint for lack of merit. On August 31, 2000,
the National Labor Relations Commission promulgated its resolution affirming the decision of the Labor
Arbiter. On July 23, 2001, the petitioner commenced her special civil action for certiorari in the Court of
Appeals (CA). The CA promulgated its decision, disposing: the judgment appealed from is
hereby AFFIRMED, insofar as its declaration that petitioner was dismissed from employment with a just cause.
However, private respondent, having violated petitioners right to due process, it is ordered to pay the petitioner
the sum of P5, 000.00, as indemnity.

ISSUES:
Whether or not the CA erred in finding her dismissal from employment to have been upon just cause. Whether
or not petitioners right to due process was violated.

RULING:
The just and valid causes for the dismissal of an employee, as enumerated in Article 282 of the Labor Code,
include: (a) serious misconduct or willful disobedience by the employee of the lawful orders of his employer or
representative in connection with her work; (b) gross and habitual neglect by the employee of her duties;
(c) fraud or willful breach by the employee of the trust reposed in her by her employer or duly authorized
representative; (d) commission of a crime or offense by the employee against the person of her employer or any
immediate member of her family or her duly authorized representative; and (e) other causes analogous to the
foregoing.
The dishonesty imputed to the petitioner included the making of double entries in the production reports and
thereby enriching herself by pocketing the extra cash generated from the double entries. Contrary to her
assertion that there was no substantial evidence to justify her dismissal, the production reports containing the
double entries were presented as evidence; and her double entries were confirmed in the affidavit executed by
Redelito Caranay, Jr., her co-employee. As such, the finding of the just cause for her dismissal did not emanate
from mere speculation, suspicion or assumption.
The petitioner argues that she did not need to dispute the charge of dishonesty or theft of her employers funds
because she had the presumption of innocence in her favor. The argument is untenable. It is true that every
person is entitled to be presumed innocent of wrongdoing. The objective of the presumption has been to lay the
burden of proof on the shoulders of the alleger of wrongdoing. The presumption extends to the petitioner and to
every other employee charged with any wrongdoing that may cause them to be sanctioned, including being
dismissed from employment. But the presumption, which is disputable, by no means excuses the employee
charged with wrongdoing from answering and defending herself once the presumption has been overcome by a
showing to the contrary. The failure of the employee to rebut or disprove the proof of wrongdoing then
establishes the charge against her. This is especially true in a case for dismissal grounded on loss of confidence
or breach of trust. Based on the record, the petitioner did not sufficiently contradict or rebut the charge of
dishonesty.

Records reveal that private respondent gave the petitioner 72 hours from receipt of the letter dated March
25, 1998 within which to give her explanation why she should not be dismissed from service because of the
earlier discussed acts alluded against her. Yet, private respondent did not present in evidence such letter which
petitioner allegedly refused to acknowledge receipt. Under our Labor laws, two (2) written notices are required
before termination of employment can be legally effected which are: (1) notice which apprises the employee of
the particular acts or omissions for which his dismissal is sought; and, (2) the subsequent notice to which
informs the employee of the employer's decision to dismiss him; not to mention the opportunity to answer and
rebut the charges against him, in between such notices.
In our view, the CA thereby erred. It overlooked the fact that the respondent had presented to the Labor
Arbiter as Annex 2 of her position paper the respondents letter dated March 25, 1998 requiring the petitioner
to submit her explanation. The bottom of the letter contained the handwritten annotation refused to sign, an
indication of the refusal to receive and sign for the letter on the part of the petitioner. Such refusal to receive the
letter containing the notice for her to explain, coupled with her failure to submit her explanation within the time
given in the letter, implied that she waived her right to contest the contents of the letter, thereby forfeiting her
right to respond to the charge against her and to rebut the evidence thereon. It further appears that on March 28,
1998 the respondent sent another letter to the petitioner informing her of the termination of her services but the
latter again refused to sign in acknowledgment of the letter. Under the circumstances, the two-notice rule was
evidently complied with by the respondent, thereby negating any denial of due process to the petitioner.
Lastly, the petitioner posits that the CA should have applied the pronouncement in Serrano v. National Labor
Relations Commission instead of that in Wenphil Corporation v. National Labor Relations Commission. To
recall, the Court held in Wenphil Corporation that the employer should still be sanctioned with an order to
indemnify the dismissed employee despite the termination being for cause provided the employer did not
observe due process.
The position of the petitioner is untenable for two reasons. Firstly, Serrano has been abandoned in Agabon v.
National Labor Relations Commission, in which the Court ruled that if the termination was valid but due
process was not followed, the employee remains dismissed but the employer must pay an indemnity heavier
than that imposed in Wenphil Corporation but lighter than full backwages. In effect, Agabon partly restored the
doctrine in Wenphil Corporation. And, secondly, both Wenphil Corporation and Serrano should apply only
when there is a finding that the termination was valid but the requirement of due process was not followed.
Obviously, neither would be applicable to the petitioner whose dismissal was valid and legal, and the
respondent as her employer complied with the demands of due process.

Northwest Airlines Inc. Ma. Concepcion Del Rosario

G.R. No. 157633, September 10, 2014
BERSAMIN, J.:

FACTS:
Northwest Airlines, Inc. employed respondent Del Rosario on as one of its Manila-based flight
attendants. During the boarding preparations, Gamboa, another flight attendant assigned at the First Class
Section of Flight NW 26, needed to borrow a wine bottle opener from her fellow attendants, Vivien Francisco,
Gamboas runner, went to the Business Class Section to borrow a wine bottle opener from Del Rosario, but the
latter remarked that any flight attendant who could not bring a wine bottle opener had no business working in
the First Class Section. Apparently, Gamboa overheard Del Rosarios remarks, and later on verbally confronted
her. Their confrontation escalated into a heated argument. Escao intervened but the two ignored her,
prompting her to rush outside the aircraft to get Maria Rosario D. Morales, the Assistant Base Manager, to
pacify them.
The parties differed on what happened thereafter. Del Rosario claimed that only an animated discussion
had transpired between her and Gamboa, but Morales insisted that it was more than an animated discussion,
recalling that Del Rosario had even challenged Gamboa to a brawl (sabunutan). Morales asserted that she had
tried to pacify Del Rosario and Gamboa, but the two did not stop; that because the two were still arguing
although the Business Class passengers were already boarding, she ordered them out of the plane and transfer
to another nearby Northwest aircraft. On June 19, 1998, Del Rosario was informed of her termination from the
service. Northwest stated that based on the results of the investigation, Del Rosario and Gamboa had engaged
in a fight on board the aircraft, even if there had been no actual physical contact between them; and that
because fighting was strictly prohibited by Northwest to the point that fighting could entail dismissal from the
service even if committed for the first time, Northwest considered her dismissal from the service justified and
in accordance with the Rules of Conduct for Employees.
Labor Arbiter Teresita D. Castillon-Lora ruled in favor of Northwest, holding that the dismissal of Del Rosario
had been justified and valid. Upon appeal, the NLRC reversed the decision of the Labor Arbiter, and ruled in
favor of Del Rosario. Aggrieved, Northwest elevated the adverse decision of the NLRC to the CA
on certiorari. The CA sustained the NLRC through its decision promulgated on June 21, 2002. Likewise, it
ruled that in lieu of reinstatement, petitioner is ordered to pay private respondent separation pay equivalent to
one month's salary for every year of service plus full backwages. Petitioner is likewise ordered to pay
respondent Del Rosario attorneys fees consisting of five (5%) per cent of the adjudged relief.

ISSUE:
Whether or not Del Rosarios dismissal from the service valid.

RULING:
Northwest argues that Del Rosario was dismissed on the grounds of serious misconduct and willful
disobedience. But misconduct or improper behavior, to be a just cause for termination of employment, must:
(a) be serious; (b) relate to the performance of the employees duties; and (c) show that the employee has
become unfit to continue working for the employer. There is no doubt that the last two elements of misconduct
were present in the case of Del Rosario. The cause of her dismissal related to the performance of her duties as a
flight attendant, and she became unfit to continue working for Northwest. Remaining to be determined is,
therefore, whether the misconduct was serious as to merit Del Rosarios dismissal. In that respect,
the fight between her and Gamboa should be so serious that it entailed the termination of her employment even
if it was her first offense. Northwest insists that what transpired between her and Gamboa was obviously a form
of fight that it strictly prohibited, but Del Rosario disputes this by contending that it was only an animated
discussion between her and Gamboa. In several rulings where the meaning of fight was decisive, the Court has
observed that the term fight was considered to be different from the term argument. In People v. Asto, for
instance, the Court characterized fight as not just a merely verbal tussle but a physical combat between two
opposing parties.
Based on the foregoing, the incident involving Del Rosario and Gamboa could not be justly considered as
akin to the fight contemplated by Northwest. In the eyes of the NLRC, Del Rosario and Gamboa were arguing
but not fighting. Moreover, the claim of Morales that Del Rosario challenged Gamboa to a brawl (sabunutan)
could not be given credence by virtue of its being self-serving in favor of Northwest, and of its being an
apparent afterthought on the part of Morales during the investigation of the incident, without Del Rosario
having the opportunity to contest Morales statement. Moreover, even assuming arguendo that the incident was
the kind of fight prohibited by Northwests Rules of Conduct, the same could not be considered as of such
seriousness as to warrant Del Rosarios dismissal from the service. The gravity of the fight, which was not
more than a verbal argument between them, was not enough to tarnish or diminish Northwests public image.
The CA properly ruled that the NLRC did not gravely abuse its discretion amounting to lack or excess of
jurisdiction by declaring Del Rosarios dismissal unjustified. Northwest as the petitioner for certiorari must
demonstrate grave abuse of discretion amounting to lack or excess of jurisdiction on the part of the NLRC.
Alas, Northwest did not show how the NLRC could have abused its discretion, let alone gravely, in ruling
adversely against it.

Pentagon International Shipping Services, Inc. vs. Court of Appeals

G.R. No. 169158, July 1, 2015
BERSAMIN, J.:
A local manning agency seeking accreditation of its foreign principal is mandated to submit the requirements
listed under Section 2 of Rule I, Book III of the Rules and Regulations Governing Overseas Employment.
FACTS:
Pentagon International Shipping Services, Inc. was a private manning agency licensed by the Philippine
Overseas Employment Administration (POEA) to engage in the recruitment of seafarers to service the crewing
and personnel management needs of shipping companies accredited to it. Respondent JDA Inter-Phil was
similarly engaged in the recruitment of seafarers. Pentagon hired respondents Madrio and Rubiano as chief
officer and second engineer, respectively, in behalf of its foreign principal, Baleen Marine, a corporation based
in Singapore. When their 10-month contract expired, they were repatriated to the Philippines. Alleging non-
payment and underpayment of wages, and claiming damages and attorneys fees, they separately brought
claims against Pentagon and the owners and managers of Baleen Marine on January 13, 2000 and January 31,
2000, stating that Pentagon and Baleen Marine had reduced their monthly gross salary by 20% without the
prior approval by the POEA; and that Pentagon and Baleen Marine had not paid their salaries from November
1, 1998 until their repatriation on March 24, 1999. Pentagon denied liability, countering that it had ceased to be
the manning agency of Baleen Marine effective October 1, 1998; that on June 25, 1998, its Executive Vice-
President, Meynardo Bugia, Jr., had met with Baleen Marine in Singapore to notify the latter that it had been
meanwhile appointed by Neptank Bunkering Services Pte., Ltd. as its exclusive local manning agency; that as
one of the conditions of its appointment, it was to immediately sever its manning contract with Baleen Marine;
and that on October 9, 1998, Baleen Marine had appointed JDA Inter-Phil as its new local agent for Baleen
Marines vessels NP Trader No. 3 and NP Prima. On its part, JDA Inter-Phil insisted that although it had
applied with the POEA for the transfer and accreditation of Baleen Marines vessels in its favor, it withdrew the
application and did not execute an affidavit of assumption and responsibility as required; that, consequently,
Pentagon continued to be jointly and severally liable with Baleen Marine for the money claims of Madrio and
Rubiano. The Labor Arbiter ruled in favor of Pentagon, declaring JDA InterPhil jointly and solidarily liable
with Baleen Marine.

ISSUE: Whether there is a valid substitution of the manning agent from Pentagon to IDA Inter-Phil.?

RULING:
No. Rule I, Book III of the Rules and Regulations Governing Overseas Employment states the
following:
Section 2. Requirements for Accreditation. An agency applying for the accreditation of its
principals or projects shall submit the following:
xxxx
b. For a Manning Agency for its Principals
(1) Authenticated special power of attorney and manning agreement;
(2) Crew complement and wages;
(3) List of vessels and their particulars; and
(4) Other documents which the Administration may find necessary.
A local manning agency seeking accreditation of its foreign principal is mandated to submit the
requirements listed under Section 2. While the list is not exhaustive, the POEA identified the foremost
requisite to be the authenticated special power of attorney and manning agreement. The law clearly mandates
that the special power of attorney and manning agreement should be authenticated, save only when the
authorized officials of both the principal or hiring company and its local agent signed the document in the
presence of any member of the POEA Directorate or duly designated officers of the POEA. The accreditation
of a principal may be transferred to another agency provided that transfer shall not involve any diminution of
wages and benefits of workers. The transferee agency in these instances shall comply with the requirements for
accreditation and shall assume full and complete responsibility to all contractual obligations of the principals to
its workers originally recruited and processed by the former agency.

Prior to the transfer of accreditation, the Administration shall notify the previous agency and principal
of such application. The foregoing rules are clear to the effect that before a transfer of accreditation can be
effected, the transferee agency should likewise have to comply with the requirements for accreditation
contained in Section 2. The POEA can act on the transfer of accreditation only after all the requirements shall
have been submitted. In light of the foregoing, there was no effective transfer of agency from Pentagon to JDA
Inter-Phil. Even assuming arguendo that JDA Inter-Phil did not withdraw its application for accreditation with
the POEA, there was still no valid transfer of agency to speak of in the first place because JDA Inter-Phil did
not submit the required authenticated special power of attorney and manning agreement. The minutes of the
October 9, 1998 meeting could not, by any stretch of the imagination, supplant this mandatory requirement.

Verily, the minutes of any meeting are simply the notes or written record of the meeting, which usually
describe what transpire during the meeting, identify the attendees, and present the statements and related
responses or resolutions of the issues discussed. Considering that the minutes of the meeting neither contained
in an unequivocal manner the important and distinct elements of a special power of attorney and manning
agreement, nor were the minutes duly authenticated as required under the law, Pentagon's insistence upon an
effective substitution must fail. To reiterate, the special power of attorney and manning agreement were
necessary for the validity or enforceability of the transfer of accreditation. Although the Court does not
preclude the possibility that, as Pentagon posits, JDA Inter-Phil had really agreed to the transfer of
accreditation, it remains that the agreement to do so did not ultimately come to fruition. It cannot but hold that
the agreement reached during the meeting was only a preliminary step in the transfer of accreditation, and
would not have standing in the POEA for the purpose intended.

It is relevant to observe that Pentagon cannot feign ignorance of Section 10, paragraph 2, of the Migrant
Workers' Act of 1995 to the effect that its liabilities would continue during the entire period or duration of the
employment contract, and would not be affected by any substitution, amendment or modification of the
contract made either locally or in a foreign country. The provisions of the POEA Rules and Regulations to the
effect that the manning agreement extends up to and until the expiration of the employment contracts of the
employees recruited and employed pursuant to the recruitment agreement are also clear enough. As such,
Pentagon is not exempt from its liabilities and responsibilities towards Madrio and Rubiano.

Hongkong & Shanghai Banking Corporation et al vs. NLRC

G.R.No. 156635, January 11, 2016
BERSAMIN, J.:
A strike staged without compliance with the requirements of Article 263 1 of the Labor Code is illegal, and may
cause the termination of the employment of the participating union officers and members. However, the liability
for the illegal strike is individual, not collective. To warrant the termination of an officer of the labor
organization on that basis, the employer must show that the officer knowingly participated in the illegal strike.
An ordinary striking employee cannot be terminated based solely on his participation in the illegal strike, for
the employer must further show that the employee committed illegal acts during the strike.
FACTS:
Petitioner Hongkong & Shanghai Banking Corporation Employees Union (Union) was the duly recognized
collective bargaining agent of the rank-and-file employees of respondent Hongkong & Shanghai Banking
Corporation (HSBC). A collective bargaining agreement (CBA) governed the relations between the Union and
its members, on one hand, and HSBC effective April 1, 1990 until March 31, 1993 for the non-representational
(economic) aspect, and effective April 1, 1990 until March 31, 1995 for the representational aspect. The CBA
included a salary structure of the employees comprising of grade levels, entry level pay rates and the individual
pays depending on the length of service. On January 18, 1993, HSBC announced its implementation of a job
evaluation program (JEP) retroactive to January 1, 1993. The JEP consisted of a job designation per grade level
with the accompanying salary scale providing for the minimum and maximum pay the employee could receive
per salary level. By letter dated January 20, 1993,8 the Union demanded the suspension of the JEP, which it
labeled as an unfair labor practice (ULP). Union informed HSBC that it would exercise its right to concerted
action. Union members started picketing during breaktime while wearing black hats and black bands on their
arms and other appendages. Due to the sustained concerted actions, HSBC filed a complaint for ULP in the
Arbitration Branch of the National Labor Relations Commission. The Union conducted a strike vote on
December 19, 1993 after HSBC accorded regular status to Patrick King, the first person hired under the JEP.
The majority of the members of the Union voted in favor of a strike. Union's officers and members walked out
and gathered outside the premises of HSBC's offices. Union members blocked the entry and exit points of the
bank premises, preventing the bank officers. HSBC filed its complaint to declare the strike illegal. HSBC
issued return-to-work notices to the striking employees. Only 25 employees complied and returned to work.
Due to the continuing concerted actions, HSBC terminated the individual petitioners.

ISSUE: Whether the strike was lawfully conducted and whether the petitioners were illegally dismissed

RULING:
Non-compliance with Article 263 of the Labor Code renders a labor strike illegal
The right to strike is a constitutional and legal right of all workers because the strike, which seeks to advance
their right to improve the terms and conditions of their employment, is recognized as an effective weapon of
labor in their struggle for a decent existence. However, the right to strike as a means for the attainment of social
justice is never meant to oppress or destroy the employers. Thus, the law prescribes limits on the exercise of the
right to strike. Article 263 of the Labor Code specifies the limitations on the exercise of the right to strike. The
procedural requirements for a valid strike are, therefore, the following, to wit: ( 1) a notice of strike filed with
the DOLE at least 30 days before the intended date thereof, or 15 days in case of ULP; (2) a strike vote
approved by the majority of the total union membership in the bargaining unit concerned, obtained by secret
ballot in a meeting called for that purpose; and (3) a notice of the results of the voting at least seven days before
the intended strike given to the DOLE. These requirements are mandatory, such that non-compliance therewith
by the union will render the strike illegal.
According to the CA, the petitioners neither filed the notice of strike with the DOLE, nor observed the cooling-
off period, nor submitted the result of the strike vote. Moreover, although the strike vote was conducted, the
same was done by open, not secret, balloting, in blatant violation of Article 263 and Section 7, Rule XIII of the
Omnibus Rules Implementing the Labor Code. It is not amiss to observe that the evident intention of the
requirements for the strike-notice and the strike-vote report is to reasonably regulate the right to strike for the
attainment of the legitimate policy objectives embodied in the law. As such, the petitioners committed a
prohibited activity under Article 264(a) of the Labor Code, and rendered their strike illegal.

Commission of unlawful acts during the strike further rendered the same illegal
The strike was far from orderly and peaceful. HSBC's claim that from the time when the strike was commenced
on December 22, 1993 the petitioners had on several instances obstructed the ingress into and egress from its
offices in Makati and in Pasig was not competently disputed, and should thus be accorded credence in the light
of the records. We agree with HSBC, for all the affidavits and testimonies of its witnesses, as well as the
photographs and the video recordings reviewed by LA Pati depicted the acts of obstruction, violence and
intimidation committed by the petitioners during their picketing. It was undeniable that such acts of the strikers
forced HSBC's officers to resort to unusual means of gaining access into its premises at one point. The situation
during the strike actually went out of hand because of the petitioners' illegal conduct, compelling HSBC to
secure an injunction from the NLRC as well as to file its petition for habeas corpus in the proper court in the
interest of its trapped officers and employees; and at one point to lease an helicopter to extract its employees
and officers from its premises on the eve of Christmas Day of 1993.

Good faith did not avail because of the patent violation of Article 263 of the Labor Code
The petitioners' disregard of the procedural requirements for conducting a valid strike negated their claim of
good faith. For their claim to be upheld, it was not enough for them to believe that their employer was guilty of
ULP, for they must also sufficiently show that the strike was undertaken with a modicum of obeisance to the
restrictions on their exercise of the right to strike prior to and during its execution as prescribed by the law.
They did not establish their compliance with the requirements specifically for the holding of the strike vote and
the giving of the strike notice.

The finding on the illegal strike did not justify the wholesale termination of the strikers from
employment
As a general rule, the mere finding of the illegality of the strike does not justify the wholesale termination of
the strikers from their employment. To avoid rendering the recognition of the workers' right to strike illusory,
the responsibility for the illegal strike is individual instead of collective. The last paragraph of Article 264(a) of
the Labor Code defines the norm for terminating the workers participating in an illegal strike. The officers may
be deemed terminated from their employment upon a finding of their knowing participation in the illegal strike,
but the members of the union shall suffer the same fate only if they are shown to have knowingly participated
in the commission of illegal acts during the strike. In the case of Fermin, HSBC did not satisfactorily prove his
presence during the strike, much less identify him as among the strikers. In contrast, Union president Ma.
Dalisay dela Chica testified that Fermin was not around when the Union's Board met after the strike vote to
agree on the date of the strike. In that regard, Corazon Fermin, his widow, confirmed the Union president's
testimony by attesting that her husband had been on leave from work prior to and during the strike because of
his heart condition. Although Corazon also attested that her husband had fully supported the strike, his
extending moral support for the strikers did not constitute sufficient proof of his participation in the strike in the
absence of a showing of any overt participation by him in the illegal strike. The burden of proving the overt
participation in the illegal strike by Fermin solely belonged to HSBC, which did not discharge its burden.
However, the dismissal of Rivera and of the rest of the Union's officers, namely: Ma. Dalisay dela Chica,
Marvilon Militante and David Atanacio, is upheld.
Unlike the Union's officers, the ordinary striking members could not be terminated for merely taking part in the
illegal strike. Regardless of whether the strike was illegal or not, the dismissal of the members could be upheld
only upon proof that they had committed illegal acts during the strike. They must be specifically identified
because the liability for the prohibited acts was determined on an individual basis. For that purpose, substantial
evidence available under the attendant circumstances justifying the penalty of dismissal sufficed.

Jennifer Lagahit vs. Pacific Concord Container Lines/ Monette Cuenca

G.R.No. 177680, January 13, 2016
BERSAMIN, J.:
In cases of unlawful dismissal, the employer bears the burden of proving that the termination was for a valid or
authorized cause, but before the employer is expected to discharge its burden of proving that the dismissal was
legal, the employee must first establish by substantial evidence the fact of her dismissal from employment.
FACTS:
Respondent Pacific Concord Container Lines, a domestic corporation engaged in cargo forwarding, hired the
petitioner as an Account Executive/Marketing Assistant. In January 2002, Pacific Concord promoted her as a
sales manager with the monthly salary rate of P25,000.00, and provided her with a brand new Toyota Altis plus
gasoline allowance. On November 8, 2002, she reported for work at 9:00 a.m. and left the company premises at
around 10:30 a.m. to make client calls. At 1:14 p.m. of that day, she received the text message from respondent
Monette Cuenca saying she is no longer connected with them. Pacific Concord also caused the publication of
the notice to the public in the Sunstar Daily. Petitioner filed her complaint for constructive dismissal. In their
position paper, the respondents denied having terminated the petitioner despite the fact that there were valid
grounds to do so. They insisted that the petitioner had betrayed the trust and confidence reposed in her when
she: (a) used the company-issued vehicle for her own personal interest; (b) failed to achieve her sales quota,
and to enhance and develop the Sales Department; (c) enticed her marketing assistant, Jo Ann Otrera, to resign
and join her in transferring to another forwarding company; (d) applied for other employment during office
hours and using company resources; (e) solicited and offered the services of Seajet International, Inc. during
her employment with Pacific Concord; (f) received a personal commission from Wesport Line, Inc. for
container shipments; and ( g) illegally manipulated and diverted several containers to Seajet International.

ISSUE: Did the petitioner resign as sales manager of Pacific Concord? Did Pacific Concord have sufficient
grounds to terminate her for breach of trust and confidence under Article 282 of the Labor Code?

RULING:
Lagahit did not resign from her employment
In cases of unlawful dismissal, the employer bears the burden of proving that the termination was for a valid or
authorized cause, but before the employer is expected to discharge its burden of proving that the dismissal was
legal, the employee must first establish by substantial evidence the fact of her dismissal from employment. In
this case, the petitioner proved the overt acts committed by the respondents in abruptly terminating her
employment through the text messages sent by Cuenca to the petitioner and her husband, as well as the notices
distributed to the clients and published in the Sun Star. It is notable that the respondents did not deny or
controvert her evidence on the matter. Thereby, she showed Pacific Concords resolve to terminate her
employment effective November 8, 2002.
As a rule, the employer who interposes the resignation of the employee as a defense should prove that the
employee voluntarily resigned.40 A valid resignation is the voluntary act of an employee who finds herself in a
situation where she believes that personal reasons cannot be sacrificed in favor of the exigency of the service
and that she has no other choice but to disassociate herself from employment. The resignation must be
unconditional and with a clear intention to relinquish the position. Consequently, the circumstances
surrounding the alleged resignation must be consistent with the employees intent to give up the employment.
In this connection, the acts of the employee before and after the resignation are considered to determine
whether or not she intended, in fact, to relinquish the employment.
The facts and circumstances before and after the petitioners severance from her employmentdid not show her
resolute intention to relinquish her job. Indeed, it would be unfounded to infer the intention to relinquish from
her letter, which, to us, was not a resignation letter due to the absence therefrom of anything evincing her desire
to sever the employer-employee relationship. The letter instead presented her as a defenseless employee
unjustly terminated for unknown reasons who had been made the subject of notices and flyers informing the
public of her unexpected termination. It also depicted her as an employee meekly accepting her unexpected fate
and requesting the payment of her backwages and accrued benefits just to be done with the employer.

Lagahit did not breach her employers trust; her dismissal was, therefore, illegal
To justify the dismissal of an employee, the employer must, as a rule, prove that the dismissal was for a just
cause, and that the employee was afforded due process prior to dismissal. As a complementary principle, the
employer has the onus of proving the validity of the dismissal with clear, accurate, consistent, and convincing
evidence. The employers case succeeds or fails on the strength of its evidence, not on the weakness of that
adduced by the employee, in keeping with the principle that the scales of justice should be tilted in favor of the
latter in case of doubt in the evidence presented by them.
Article 282(c) of the Labor Code authorizes an employer to dismiss an employee for committing fraud, or for
willful breach of the trust reposed by the employer. However, loss of confidence is never intended to provide
the employer with a blank check for terminating its employee. For this to be a valid ground for the termination
of the employee, the employer must establish that: (1) the employee must be holding a position of trust and
confidence; and (2) the act complained against would justify the loss of trust and confidence. There are two
classes of employees vested with trust and confidence. To the first class belong the managerial employees or
those vested with the powers or prerogatives to lay down management policies and to hire, transfer, suspend,
lay-off, recall, discharge, assign or discipline employees or effectively recommend such managerial actions.
The second class includes those who in the normal and routine exercise of their functions regularly handle
significant amounts of money or property. Cashiers, auditors, and property custodians are some of the
employees in the second class. The petitioner discharged the following duties and responsibilities as sales
manager. Her position as sales manager did not immediately make the petitioner a managerial employee. The
actual work that she performed, not her job title, determined whether she was a managerial employee vested
with trust and confidence. Her employment as sales manager was directly related with the sales of cargo
forwarding services of Pacific Concord, and had nothing to do with the implementation of the managements
rules and policies. As such, the position of sales manager came under the second class of employees vested
with trust and confidence.
At any rate, the employer must present clear and convincing proof of an actual breach of duty committed by the
employee by establishing the facts and incidents upon which the loss of confidence in the employee may fairly
be made to rest. The required amount of evidence for doing so is substantial proof. With these guidelines in
mind, we cannot hold that the evidence submitted by the respondents (consisting of the three affidavits)
sufficiently established the disloyalty of the petitioner. The affidavits did not show how she had betrayed her
employers trust. Considering that the petitioners duties related to the sales of forwarding services offered by
Pacific Concord, her calling other forwarding companies to inquire for vacant positions did not breach the trust
reposed in her as sales manager. Such act, being at worst a simple act of indiscretion, did not constitute the
betrayal of trust that merited the extreme penalty of dismissal from employment.

Alumamay Jamias et al vs. NLRC

G.R. NO. 159350, March 9, 2016
BERSAMIN, J.:
A fixed term agreement, to be valid, must strictly conform with the requirements and conditions provided in
Article 280 of the Labor Code. The test to determine whether a particular employee is engaged as a project or
regular employee is whether or not the employee is assigned to carry out a specific project or undertaking, the
duration or scope of which was specified at the time of his engagement. There must be a determination of, or a
clear agreement on, the completion or termination of the project at the time the employee is engaged.
Otherwise put, the fixed period of employment must be knowingly and voluntarily agreed upon by the parties,
without any force, duress or improper pressure being brought to bear upon the employee and absent any other
circumstances vitiating his consent, or it must satisfactorily appear that the employer and employee dealt with
each other on more or less equal terms with no moral dominance whatsoever being exercised by the former on
the latter.
FACTS:
Respondent Innodata Philippines, Inc. (Innodata), a domestic corporation engaged in the business of data
processing and conversion for foreign clients. After the respective contracts of the employees expired, they
filed a complaint for illegal dismissal claiming that Innodata had made it appear that they had been hired as
project employees in order to prevent them from becoming regular employees.

ISSUE: Were the petitioners regular or project employees of Innodata?

RULING:
A fixed period in a contract of employment does not by itself signify an intention to circumvent Article
280 of the Labor Code
The provision contemplates three kinds of employees, namely: (a) regular employees; (b) project employees;
and (c) casuals who are neither regular nor project employees. The nature of employment of a worker is
determined by the factors provided in Article 280 of the Labor Code, regardless of any stipulation in the
contract to the contrary. Thus, in Brent School, Inc. v. Zamora, we explained that the clause referring to written
contracts should be construed to refer to agreements entered into for the purpose of circumventing the security
of tenure. Obviously, Article 280 does not preclude an agreement providing for a fixed term of employment
knowingly and voluntarily executed by the parties.
A fixed term agreement, to be valid, must strictly conform with the requirements and conditions provided in
Article 280 of the Labor Code. The test to determine whether a particular employee is engaged as a project or
regular employee is whether or not the employee is assigned to carry out a specific project or undertaking, the
duration or scope of which was specified at the time of his engagement. There must be a determination of, or a
clear agreement on, the completion or termination of the project at the time the employee is engaged. Otherwise
put, the fixed period of employment must be knowingly and voluntarily agreed upon by the parties, without any
force, duress or improper pressure being brought to bear upon the employee and absent any other circumstances
vitiating his consent, or it must satisfactorily appear that the employer and employee dealt with each other on
more or less equal terms with no moral dominance whatsoever being exercised by the former on the latter.
For one, it would be unusual for a company like Innodata to undertake a project that had no relationship to its
usual business. Also, the necessity and desirability of the work performed by the employees are not the
determinants in term employment, but rather the day certain voluntarily agreed upon by the parties. In fine,
the employment of the petitioners who were engaged as project employees for a fixed term legally ended upon
the expiration of their contract. Their complaint for illegal dismissal was plainly lacking in merit.
Robina Farms Cebu vs. Elizabeth Villa
G.R. No. 175869, April 18, 2016
BERSAMIN, J.:
Section 4(a), Rule VI of the Amended NLRC Rules of Procedure requires an appeal to be verified by the
appellant herself. The verification is a mere formal requirement intended to secure and to give assurance that
the matters alleged in the pleading are true and correct. The requirement is complied with when one who has
the ample knowledge to swear to the truth of the allegations in the complaint or petition signs the verification,
or when the matters contained in the petition have been alleged in good faith or are true and correct. Being a
mere formal requirement, the courts may even simply order the correction of improperly verified pleadings, or
act on the same upon waiving the strict compliance with the rules of procedure.
FACTS:
Respondent Elizabeth Villa brought against the petitioner her complaint for illegal suspension, illegal dismissal,
nonpayment of overtime pay, and nonpayment of service incentive leave pay in the Regional Arbitration
Branch No. VII of the NLRC in Cebu City. Villa averred that she had been employed by petitioner Robina
Farms as sales clerk since August 1981; that in the later part of 2001, the petitioner had enticed her to avail
herself of the company's special retirement program; that on March 2, 2002, she had received a memorandum
from Lily Ngochua requiring her to explain her failure to issue invoices for unhatched eggs in the months of
January to February 2002; that she had explained that the invoices were not delivered on time because the
delivery receipts were delayed and overlooked; that despite her explanation, she had been suspended for 10
days from March 8, 2002 until March 19, 2002; that upon reporting back to work, she had been advised to
cease working because her application for retirement had already been approved; that she had been
subsequently informed that her application had been disapproved, and had then been advised to tender her
resignation with a request for financial assistance; that she had manifested her intention to return to work but
the petitioner had confiscated her gate pass; and that she had since then been prevented from entering the
company premises and had been replaced by another employee.
Labor Arbiter Violeta Ortiz-Bantug rendered her decision finding that Villa had not been dismissed from
employment. NLRC rendered its judgment dismissing the appeal by the petitioner but granting that of Villa.
The CA treated the petitioner's appeal as an unsigned pleading because the petitioner did not present proof
showing that Florabeth P. Zanoria, its Administrative Officer and Chief Accountant who had signed the
verification, had been authorized to sign and file the appeal.

ISSUE: Whether or not Villa's appeal should be treated as an unsigned pleading because she had accompanied
her appeal with the same verification attached to her position paper
Whether or not petitioner did not admit Villa back to work

RULING: No
Section 4(a), Rule VI of the Amended NLRC Rules of Procedure requires an appeal to be verified by the
appellant herself. The verification is a mere formal requirement intended to secure and to give assurance that
the matters alleged in the pleading are true and correct. The requirement is complied with when one who has
the ample knowledge to swear to the truth of the allegations in the complaint or petition signs the verification,
or when the matters contained in the petition have been alleged in good faith or are true and correct. Being a
mere formal requirement, the courts may even simply order the correction of improperly verified pleadings, or
act on the same upon waiving the strict compliance with the rules of procedure. It is the essence of the NLRC
Rules of Procedure to extend to every party-litigant the amplest opportunity for the proper and just
determination of his cause, free from the constraints of technicalities. Accordingly, the substantial compliance
with the procedural rules is appreciated in favor of Villa. For one, it belatedly submitted proof of Zanoria' s
authority to verify the pleading for the petitioner. Also, it did not submit the certification of non-forum
shopping at the time of the filing of the appeal. The non-submission of the certification, being a ground for
dismissal, was fatal to the petition. There is no question that the non-compliance with the requirement for the
certification, or a defect in the certification, would not be cured by the subsequent submission or the correction
of the certification, except in cases of substantial compliance or upon compelling reasons. Accordingly, the
dismissal of the petitioner's appeal cannot be reversed or undone.
We note that the CA and the NLRC agreed on their finding that the petitioner did not admit Villa back to work
after the completion of her 10-day suspension. Neither did Villa's application for early retirement manifest her
intention to sever the employer-employee relationship. Although she applied for early retirement, she did so
upon the belief that she would receive a higher benefit based on the petitioner's offer. As such, her consent to
be retired could not be fairly deemed to have been knowingly and freely given. Retirement is the result of a
bilateral act of both the employer and the employee based on their voluntary agreement that upon reaching a
certain age, the employee agrees to sever his employment. The difficulty in the case of Villa arises from
determining whether the retirement was voluntary or involuntary. On one hand, voluntary retirement cuts the
employment ties leaving no residual employer liability; on the other, involuntary retirement amounts to a
discharge, rendering the employer liable for termination without cause.
In case of early retirement programs, the offer of benefits must be certain while the acceptance to be retired
should be absolute. The acceptance by the employees contemplated herein must be explicit, voluntary, free and
uncompelled. Under the circumstances, the CA did not err in declaring the petitioner guilty of illegal dismissal
for violating Article 282 of the Labor Code and the twin notice rule.

Sugarsteel Industrial Inc. and Mr. Ben Yapjoco vs. Victor Albina, Vicente Uy and Alex Velasquez
G.R. No. 168749, June 6, 2016
BERSAMIN, J.:
The policy of practicing comity towards the factual findings of the labor tribunals does not preclude the CA
from reviewing the findings, and from disregarding the findings upon a clear showing of the NLRC's
capricious, whimsical or arbitrary disregard of the evidence or of circumstances of considerable importance
crucial or decisive of the controversy. In such eventuality, the writ of certiorari should issue, and the CA, being
also a court of equity, then enjoys the leeway to make its own independent evaluation of the evidence of the
parties as well as to ascertain whether or not substantial evidence supported the NLRC's ruling.
FACTS:
A clog-up occurred at the kettle sheet guide. At that time, the petitioners were on duty working in their assigned
areas. As a consequence, twenty (20) GI sheets were clogged-up inside the kettle, causing damage to the private
respondent. On the same day, a memorandum was issued by Mr. Ben S. Yapjoco, manager of the private
respondent, requiring all the petitioners to submit written explanation on the aforesaid incident and why no
action shall be taken against them for gross negligence. Individual notices of suspension were sent to the
petitioners pending final decision relative to the incident. On August 29, 1996, Mr. Yapjoco again sent
individual notices of termination of employment to all petitioners, stating that after the management conducted
an investigation on the circumstances surrounding the incident, the petitioners were found guilty of gross
neglect of duty and by reason thereof they were terminated from their employment. Respondents Victor Albina,
Vicente Uy and Alex Velasquez charged the petitioners in the Regional Arbitration Branch of the National
Labor Relations Commission (NLRC) in Cebu City with having illegally dismissed them as kettleman, assistant
kettleman, and inspector, respectively. Labor Arbiter (LA) ruled that although the dismissal of the respondents
was justified because of their being guilty of gross negligence, the petitioners should pay them their separation
pay at the rate of 1/2 month per year of service. NLRC denied the respondents' motion for reconsideration. CA
granted the petition for certiorari.

ISSUE: Did the CA depart from well-settled rules on what findings the CA could review on certiorari?

RULING: No
The policy of practicing comity towards the factual findings of the labor tribunals does not preclude the CA
from reviewing the findings, and from disregarding the findings upon a clear showing of the NLRC's
capricious, whimsical or arbitrary disregard of the evidence or of circumstances of considerable importance
crucial or decisive of the controversy. In such eventuality, the writ of certiorari should issue, and the CA, being
also a court of equity, then enjoys the leeway to make its own independent evaluation of the evidence of the
parties as well as to ascertain whether or not substantial evidence supported the NLRC's ruling.
NLRC affirmed the decision of the LA based on its observation that the alleged ground for the respondents'
appeal -that "the decision with all due respect, is not supported by evidence and is contrary to the facts
obtaining" -was not one of those expressly enumerated under Article 223 of the Labor Code. CA acted
judiciously in undoing the too literal interpretation of Article 223 of the Labor Code by the NLRC. The
enumeration in the provision of the grounds for an appeal actually encompassed the ground relied upon by the
respondents in their appeal. Their phrasing of the ground, albeit not hewing closely (or literally) to that of
Article 223, related to the first and the last grounds under the provision. In dismissing the appeal on that basis,
the NLRC seemed to prefer form and technicality to substance and justice. Thereby, the NLRC acted
arbitrarily, for its dismissal of the appeal became entirely inconsistent with the constitutional mandate for the
protection to labor.
CA's overturning of the NLRC's ruling was based on its finding that the petitioners did not sufficiently establish
the just and valid cause to dismiss the respondents from their employment. As the assailed judgment indicates,
the CA's review was thorough and its ruling judicious. The CA thereby enforced against the petitioners the
respected proposition that it was the employer who bore the burden to show that the dismissal was for just and
valid cause. The failure of the petitioners to discharge their burden of proof as the employers necessarily meant
that the dismissal was illegal. The outcome could not be any other way.
In order to warrant the dismissal of the employee for just cause, Article 282 (b) of the Labor Code requires the
negligence to be gross and habitual. Gross negligence is the want of even slight care, acting or omitting to act
in a situation where there is duty to act, not inadvertently but willfully and intentionally, with a conscious
indifference to consequences insofar as other persons may be affected. Habitual neglect connotes repeated
failure to perform one's duties for a period of time, depending upon the circumstances. Obviously, a single or
isolated act of negligence does not constitute a just cause for the dismissal of the employee. Considering,
however, that the petitioners did not refute the respondents' claim that the incident was their first offense, and
that the petitioners did not present any evidence to establish the supposed habitual neglect on the part of the
respondents, like employment or other records indicative of the service and personnel histories of the
respondents during the period of their employment, the CA reasonably found and concluded that the just cause
to dismiss them was not established by substantial evidence.

The Heritage Hotel Manila vs. Secretary of Labor and Employment et al

G.R. No. 172132, July 23, 2014
BERSAMIN, J.:

FACTS:
Respondent National Union of Workers in Hotel Restaurant and Allied Industries-Heritage Hotel
Manila Supervisors Chapter (NUWHRAIN-HHMSC) filed a petition for certification election, seeking to
represent all the supervisory employees of Heritage Hotel Manila. The petitioner filed its opposition, but the
opposition was deemed denied when Med-Arbiter Napoleon V. Fernando issued his order for the conduct of the
certification election. The petitioner appealed the order of Med-Arbiter Fernando, but the appeal was also
denied. A pre-election conference was then scheduled. On February 20, 1998, however, the pre-election
conference was suspended until further notice because of the repeated non-appearance of NUWHRAIN-
HHMSC. On January 29, 2000, NUWHRAIN-HHMSC moved for the conduct of the pre-election conference.
The petitioner filed a motion to dismiss on April 17, 2000, raising the prolonged lack of interest of
NUWHRAIN-HHMSC to pursue its petition for certification election.
On May 12, 2000, the petitioner filed a petition for the cancellation of NUWHRAIN-HHMSCs registration as
a labor union for failing to submit its annual financial reports and an updated list of members as required by
Article 238 and Article 239 of the Labor Code. The following day, however, the Department of Labor and
Employment (DOLE) issued a notice scheduling the certification elections on June 23, 2000. Dissatisfied, the
petitioner commenced in the CA on June 14, 2000 a special civil action for certiorari, alleging that the DOLE
gravely abused its discretion in not suspending the certification election proceedings but the CA dismissed the
petition for certiorari. The certification election proceeded as scheduled, and NUWHRAIN-HHMSC obtained
the majority vote of the bargaining unit. On January 26, 2001, Med-Arbiter Tomas F. Falconitin issued an
order, ruling that the petition for the cancellation of union registration was not a bar to the holding of the
certification election; hence, respondent employer/protestants protest with motion to defer certification of
results and winner is hereby dismissed for lack of merit. The petitioner timely appealed to the DOLE Secretary.
On August 21, 2002, then DOLE Secretary Sto. Tomas issued a resolution denying the appeal. Upon denial of
its motion for reconsideration, the petitioner elevated the matter to the CA by petition for certiorari, but the
petition was dismissed.

ISSUE:
Whether or not the CA seriously erred when it disregard PROGRESSIVE DEVELOPMENT CORPORATION
PIZZA HUT V. LAGUESMA which held that it would be more prudent to suspend the certification case until
the issue of the illegality of registration of the union is finally resolved.

RULING: NO
Basic in the realm of labor union rights is that the certification election is the sole concern of the
workers, and the employer is deemed an intruder as far as the certification election is concerned. Thus, the
petitioner lacked the legal personality to assail the proceedings for the certification election, and should stand
aside as a mere bystander who could not oppose the petition, or even appeal the Med-Arbiters orders relative
to the conduct of the certification election.
The petitioners meddling in the conduct of the certification election among its employees unduly gave
rise to the suspicion that it intended to establish a company union. For that reason, the challenges it posed
against the certification election proceedings were rightly denied.
Under the long established rule, too, the filing of the petition for the cancellation of NUWHRAIN-
35
HHMSCs registration should not bar the conduct of the certification election. In that respect, only a final
order for the cancellation of the registration would have prevented NUWHRAIN-HHMSC from continuing to
enjoy all the rights conferred on it as a legitimate labor union, including the right to the petition for the
certification election. This rule is now enshrined in Article 238-A of the Labor Code, as amended by Republic
Act No. 9481.
Still, the petitioner assails the failure of NUWHRAIN-HHMSC to submit its periodic financial reports
and updated list of its members pursuant to Article 238 and Article 239 of the Labor Code.
We cannot ascribe abuse of discretion to the Regional Director and the DOLE Secretary in denying the
petition for cancellation of respondent's registration. The union members and, in fact, all the employees
belonging to the appropriate bargaining unit should not be deprived of a bargaining agent, merely because of
the negligence of the union officers who were responsible for the submission of the documents to the BLR.
Labor authorities should, indeed, act with circumspection in treating petitions for cancellation of union
registration, lest they be accused of interfering with union activities.
In resolving the petition, consideration must be taken of the fundamental rights guaranteed by Article
XIII, Section 3 of the Constitution, i.e., the rights of all workers to self-organization, collective bargaining and
negotiations, and peaceful concerted activities. Thus, the cancellation of a certificate of registration is the
equivalent of snuffing out the life of a labor organization. For without such registration, it loses - as a rule - its
rights under the Labor Code.
The Labor Code's provisions on cancellation of union registration and on reportorial requirements have
been recently amended by Republic Act (R.A.) No. 9481, which lapsed into law on May 25, 2007 and became
effective on June 14, 2007. The amendment sought to strengthen the workers right to self-organization and
enhance the Philippines' compliance with its international obligations as embodied in the International Labor
Organization (ILO) Convention No. 87, pertaining to the non-dissolution of workers organizations by
administrative authority. Failure to comply with the above requirements shall not be a ground for cancellation
of union registration but shall subject the erring officers or members to suspension, expulsion from
membership, or any appropriate penalty. The ruling thereby wrote finis to the challenge being posed by the
petitioner against the illegitimacy of NUWHRAIN-HHMSC.

The remaining issue to be resolved is which among Toyota Motor, Dunlop Slazenger and Tagaytay
Highlands applied in resolving the dispute arising from the mixed membership in NUWHRAIN-HHMSC.

We note that NUWHRAIN-HHMSC filed its petition for the certification election on October 11, 1995.
Conformably with Kawashima, the applicable law was the 1989 Amended Omnibus Rules, and the prevailing
rule was the pronouncement in Toyota Motor and Dunlop Slazenger to the effect that a labor union of mixed
membership was not possessed with the requisite personality to file a petition for the certification election.
Nonetheless, we still rule in favor of NUWHRAIN-HHMSC. Court was convinced that the concerned labor
unions were comprised by mixed rank-and-file and supervisory employees. In Toyota Motor, the employer
submitted the job descriptions of the concerned employees to prove that there were supervisors in the
petitioning union for rank-and-file employees. In Dunlop Slazenger, the Court observed that the labor union of
supervisors included employees occupying positions that apparently belonged to the rank-and-file. In
both Toyota Motor and Dunlop Slazenger, the employers were able to adduce substantial evidence to prove the
existence of the mixed membership. Based on the records herein, however, the petitioner failed in that respect.
To recall, it raised the issue of the mixed membership in its comment on the list of members submitted by
NUWHRAIN-HHMSC, and in its protest. In the comment, it merely identified the positions that were either
confidential or managerial, but did not present any supporting evidence to prove or explain the identification. In
the protest, it only enumerated the positions that were allegedly confidential and managerial, and identified two
employees that belonged to the rank-and-file, but did not offer any description to show that the positions
belonged to different employee groups.
Worth reiterating is that the actual functions of an employee, not his job designation, determined whether the
employee occupied a managerial, supervisory or rank-and-file position. As to confidential employees who were
excluded from the right to self-organization, they must (1) assist or act in a confidential capacity, in regard (2)
43
to persons who formulated, determined, and effectuated management policies in the field of labor relations. In
that regard, mere allegations sans substance would not be enough, most especially because the constitutional
right of workers to self-organization would be compromised.
At any rate, the members of NUWHRAIN-HHSMC had already spoken, and elected it as the bargaining agent.
As between the rigid application of Toyota Motors and Dunlop Slazenger, and the right of the workers to self-
organization, we prefer the latter. For us, the choice is clear and settled. What is important is that there is an
unmistakeable intent of the members of [the] union to exercise their right to organize. We cannot impose
rigorous restraints on such right if we are to give meaning to the protection to labor and social justice clauses of
the Constitution.
 A CADEMICUS REVIEW CENTER
Dean Ferdinand A. Tan

LEGAL ETHICS CASES ( 2012 - 2016)

J. BERSAMIN

RE: Verified Complaint of Engr. Oscar L. Ongjoco, Chairman of the Board/CEO of FH-GYMN Multi-
Purpose and Transport Service Cooperative, against Hon. Juan Enriquez, Jr., Hon. Ramon Bato, Jr.,
and Hon. Florito S. Macalino, Associate Justices, Court of Appeals
A.M. OCA IPI No. 11-184-CA-J, January 31, 2012

BERSAMIN, J.:
Judicial officers do not have to suffer the brunt of unsuccessful or dissatisfied litigants baseless and false
imputations of their violating the Constitution in resolving their cases and of harboring bias and partiality
towards the adverse parties. The litigant who baselessly accuses them of such violations is not immune from
appropriate sanctions if he thereby affronts the administration of justice and manifests a disrespect towards the
judicial office.
FACTS:
On June 7, 2011, the Court received a letter from Engr. Oscar L. Ongjoco, claiming himself to be the Chairman
of the Board and Chief Executive Officer (CEO) of the FH-GYMN Multi-Purpose and Transport Service
Cooperative (FH-GYMN). The letter included a complaint-affidavit, whereby Ongjoco charged the CAs Sixth
Division composed of Associate Justice Juan Q. Enriquez, Jr. (as Chairman), Associate Justice Ramon M. Bato,
Jr., and Associate Justice Florito S. Macalino as Members for rendering an arbitrary and baseless decision in
CA-G.R. SP No. 102289 entitled FH-GYMN Multi-Purpose and Transport Service Cooperative v. Allan Ray A.
Baluyut, et al.
The genesis of CA-G.R. SP No. 102289 started when FH-GYMN requested the amendment of Kautusang
Bayan Blg. 37-02-97 of the City of San Jose del Monte, Bulacan through the Committee on Transportation and
Communications (Committee) of the Sangguniang Panlungsod in order to include the authorization of FH-
GYMNs Chairman to issue motorized tricycle operators permit (MTOP) to its members. During the ensuing
scheduled public hearings, City Councilors Allan Ray A. Baluyut and Nolly Concepcion, together with ABC
President Bartolome B. Aguirre and one Noel Mendoza (an employee of the Sanggunian), were alleged to have
uttered statements exhibiting their bias against FH-GYMN. Indeed, the Sanggunian, acting upon the
recommendation of the Committee, denied the request of FH-GYMN.
FH-GYMN brought a complaint in the Office of the Deputy Ombudsman for Luzon charging Baluyut,
Concepcion, Aguirre, Mendoza with violations of Article 124(2)(d) of the Cooperative Code, Section 3(e) and
(f) of the Republic Act No. 3019 (Anti-Graft and Corrupt Practices Act), and Section 5(a) of Republic Act No.
6713 (Code of Conduct for Public Officials and Employees). The complaint also charged Eduardo de Guzman
(FRAHTODA President) and Wilson de Guzman (BMTODA President). Eventually, the complaint of FH-
GYMN was dismissed for insufficiency of evidence as to the public officials, and for lack of merit and lack of
jurisdiction as to the private respondents. FH-GYMN sought reconsideration, but its motion to that effect was
denied. CAs Sixth Division denied the petition for review. Ongjoco initiated this administrative case against the
aforenamed member of the CAs Sixth Division.
Ongjoco insists that the decision promulgated on January 31, 2011 by the CAs Sixth Division had no legal
foundation and did not even address the five issues presented in the petition for review; and that the
respondents as members of the CAs Sixth Division thereby violated Section 14, Article VIII of the
Constitution.

ISSUE: Whether or not the administrative complaint must be dismissed

RULING: Yes
The insistence of Ongjoco is unfounded. The essential purpose of the constitutional provision is to
require that a judicial decision be clear on why a party has prevailed under the law as applied to the facts as
proved; the provision nowhere demands that a point-by-point consideration and resolution of the issues raised
by the parties are necessary. Its decision shows that the CAs Sixth Division complied with the requirements of
the constitutional provision. Indeed, the definitive pronouncement of the CAs Sixth Division that the Deputy
Ombudsman found no substantial evidence to prove that there was interference in the internal affairs of FH-
GYMN nor was there a violation of the law by the respondents met the constitutional demand for a clear and
distinct statement of the facts and the law on which the decision was based. The CAs Sixth Division did not
have to point out and discuss the flaws of FH-GYMNs petition considering that the decision of the Deputy
Ombudsman sufficiently detailed the factual and legal bases for the denial of the petition. Moreover, the CAs
Sixth Division expressly found that FH-GYMN had not discharged its burden as the petitioner of proving its
allegations with substantial evidence. In administrative cases involving judicial officers, the complainants
always carried on their shoulders the burden of proof to substantiate their allegations through substantial
evidence.
Ongjoco ought to know, if he genuinely wanted the Court to sustain his allegations of misconduct against
respondent Justices, that his administrative complaint must rest on the quality of the evidence; and that his
basing his plain accusations on hunches and speculations would not suffice to hold them administratively liable
for rendering the adverse decision. Nonetheless, he exhibited disrespect for respondent Justices judicial office
by still filing this administrative complaint against them despite conceding in the administrative complaint
itself his having no proof of his charges. We seize this occasion, therefore, to stress once again that disciplinary
proceedings and criminal actions brought against any judge in relation to the performance of his official
functions are neither complementary to nor suppletory of appropriate judicial remedies, nor a substitute for
such remedies. Any party who may feel aggrieved should resort to these remedies, and exhaust them, instead of
resorting to disciplinary proceedings and criminal actions.
A judges failure to correctly interpret the law or to properly appreciate the evidence presented does not
necessarily incur administrative liability for to hold him administratively accountable for every erroneous
ruling or decision he renders, assuming he has erred, will be nothing short of harassment and will make his
position doubly unbearable. His judicial office will then be rendered untenable, because no one called upon to
try the facts or to interpret the law in the process of administering justice can be infallible in his
judgment. Administrative sanction and criminal liability should be visited on him only when the error is so
gross, deliberate and malicious, or is committed with evident bad faith, or only in clear cases of violations by
him of the standards and norms of propriety and good behavior prescribed by law and the rules of procedure, or
fixed and defined by pertinent jurisprudence.

Ferdinand Samson vs. Atty. Edgardo Era

A.C. No. 6664, July 16, 2013
BERSAMIN, J.:
An attorney who wittingly represents and serves conflicting interests may be suspended from the practice of
law, or even disbarred when circumstances so warrant.
FACTS:
Ferdinand A. Samson has brought this complaint for disbarment charging respondent Atty. Edgardo 0. Era with
violation of his trust and confidence of a client by representing the interest of Emilia C. Sison, his present
client, in a manner that blatantly conflicted with his interest. Samson and his relatives were among the investors
who fell prey to the pyramiding scam perpetrated by ICS Exports, Inc. Exporter, Importer, and Multi-Level
Marketing Business. Samson engaged Atty. Era to represent and assist him and his relatives in the criminal
prosecution of Sison and her group. Pursuant to the engagement, Atty. Era prepared the demand letter dated
July 19, 2002 demanding the return or refund of the money subject of their complaints. He also prepared the
complaint-affidavit that Samson signed and swore to on July 26, 2002. After the preliminary investigation, the
OCPQC formally charged Sison and the others with several counts of estafa in the Regional Trial Court,
Branch 96 (RTC), in Quezon City.
In April 2003, Atty. Era called a meeting with Samson and his relatives to discuss the possibility of an amicable
settlement with Sison and her cohorts. He told Samson and the others that undergoing a trial of the cases would
just be a waste of time, money and effort for them, and that they could settle the cases with Sison and her
group, with him guaranteeing the turnover to them of a certain property located in Antipolo City belonging to
ICS Corporation in exchange for their desistance. They acceded and executed the affidavit of desistance he
prepared, and in turn they received a deed of assignment covering land registered under Transfer Certificate of
Title No. R-4475 executed by Sison in behalf of ICS Corporation.
Samson and his relatives later demanded from Atty. Era that they be given instead a deed of absolute sale to
enable them to liquidate the property among themselves. It took some period of negotiations between them and
Atty. Era before the latter delivered to them on November 27, 2003 five copies of a deed of absolute sale
involving the property. However, Atty. Era told them that whether or not the title of the property had been
encumbered or free from lien or defect would no longer be his responsibility. He further told them that as far as
he was concerned he had already accomplished his professional responsibility towards them upon the amicable
settlement of the cases between them and ICS Corporation. When Samson and his co-complainants verified the
title of the property at the Registry of Deeds and the Assessors Office of Antipolo City, they were dismayed to
learn that they could not liquidate the property because it was no longer registered under the name of ICS
Corporation but was already under the name of Bank Wise Inc. Upon their urging, Atty. Era negotiated as their
counsel with ICS Corporation. Due to the silence of Atty. Era for sometime thereafter, Samson and his group
wrote to him on September 8, 2004 to remind him about his guarantee and the promise to settle the issues with
Sison and her cohorts. But they did not hear from Atty. Era at all. During the hearings in the RTC, Atty. Era did
not anymore appear for Samson and his group. This forced them to engage another lawyer. They were shocked
to find out later on, however, that Atty. Era had already been entering his appearance as the counsel for Sison in
her other criminal cases in the other branches of the RTC in Quezon City involving the same pyramiding scam
that she and her ICS Corporation had perpetrated. On January 20, 2005, Samson executed an affidavit alleging
the foregoing antecedents, and praying for Atty. Eras disbarment on the ground of his violation of the trust,
confidence and respect reposed in him as their counsel.

ISSUE: Whether or not Atty. Era violated the Code of Professional Responsibility

RULING: Yes
Rule 15.03, Canon 15 of the Code of Professional Responsibility provides that: A lawyer shall not represent
conflicting interests except by written consent of all concerned given after a full disclosure of the facts. Atty.
Era thus owed to Samson and his group entire devotion to their genuine interest, and warm zeal in the
maintenance and defense of their rights. He was expected to exert his best efforts and ability to preserve the
clients cause, for the unwavering loyalty displayed to his clients likewise served the ends of justice. The rule
prohibiting conflict of interest was fashioned to prevent situations wherein a lawyer would be representing a
client whose interest is directly adverse to any of his present or former clients. In the same way, a lawyer may
only be allowed to represent a client involving the same or a substantially related matter that is materially
adverse to the former client only if the former client consents to it after consultation. The rule is grounded in
the fiduciary obligation of loyalty. Throughout the course of a lawyer-client relationship, the lawyer learns all
the facts connected with the client's case, including the weak and strong points of the case. Knowledge and
information gathered in the course of the relationship must be treated as sacred and guarded with care. It
behooves lawyers not only to keep inviolate the clients confidence, but also to avoid the appearance of
treachery and double-dealing, for only then can litigants be encouraged to entrust their secrets to their lawyers,
which is paramount in the administration of justice. The nature of that relationship is, therefore, one of trust and
confidence of the highest degree.
Contrary to Atty. Eras ill-conceived attempt to explain his disloyalty to Samson and his group, the termination
of the attorney-client relationship does not justify a lawyer to represent an interest adverse to or in conflict with
that of the former client. The spirit behind this rule is that the clients confidence once given should not be
stripped by the mere expiration of the professional employment. Even after the severance of the relation, a
lawyer should not do anything that will injuriously affect his former client in any matter in which the lawyer
previously represented the client. Nor should the lawyer disclose or use any of the clients confidences acquired
in the previous relation. In this regard, Canon 17 of the Code of Professional Responsibility expressly declares
that: A lawyer owes fidelity to the cause of his client and he shall be mindful of the trust and confidence
reposed in him.
The lawyers highest and most unquestioned duty is to protect the client at all hazards and costs even to
himself. The protection given to the client is perpetual and does not cease with the termination of the litigation,
nor is it affected by the clients ceasing to employ the attorney and retaining another, or by any other change of
relation between them. It even survives the death of the client. In the absence of the express consent from
Samson and his group after full disclosure to them of the conflict of interest, therefore, the most ethical thing
for Atty. Era to have done was either to outrightly decline representing and entering his appearance as counsel
for Sison, or to advice Sison to engage another lawyer for herself. Unfortunately, he did neither, and should
now suffer the proper sanction.

Czarina Malvar vs. Kraft Food Phils. Inc.

G.R. No. 183952, September 9, 2013
BERSAMIN, J.:
Although the practice of law is not a business, an attorney is entitled to be properly compensated for the
professional services rendered for the client, who is bound by her express agreement to duly compensate the
attorney. The client may not deny her attorney such just compensation.
FACTS:
Kraft Foods (Phils.), Inc. (KFPI) hired Czarina Malvar as its Corporate Planning Manager. From then on, she
gradually rose from the ranks, becoming in 1996 the Vice President for Finance in the Southeast Asia Region
of Kraft Foods International (KFI), KFPIs mother company. On November 29, 1999, respondent Bienvenido
S. Bautista, as Chairman of the Board of KFPI and concurrently the Vice President and Area Director for
Southeast Asia of KFI, sent Malvar a memo directing her to explain why no administrative sanctions should be
imposed on her for possible breach of trust and confidence and for willful violation of company rules and
regulations. Following the submission of her written explanation, an investigating body was formed. In due
time, she was placed under preventive suspension with pay. Ultimately, on March 16, 2000, she was served a
notice of termination. Obviously aggrieved, Malvar filed a complaint for illegal suspension and illegal
dismissal against KFPI and Bautista in the National Labor Relations Commission (NLRC). Labor Arbiter found
and declared her suspension and dismissal illegal, and ordered her reinstatement, and the payment of her full
backwages, inclusive of allowances and other benefits, plus attorneys fees. NLRC affirmed the decision of the
Labor Arbiter but additionally ruled that Malvar was entitled to any and all stock options and bonuses she was
entitled to or would have been entitled to had she not been illegally dismissed from her employment, as
well as to moral and exemplary damages. Labor Arbiter Jaime M. Reyno issued an order, finding that the
RCUs computation lacked legal basis for including the salary increases that the decision promulgated in CA-
G.R. SP No. 69660 did not include. Hence, Labor Arbiter Reyno reduced Malvars total monetary award to
P27,786,378.11 Malvar and the respondents entered into a compromise agreement. the Court received on
February 15, 2011 a so-called Motion for Intervention to Protect Attorneys Rights from The Law Firm of
Dasal, Llasos and Associates, through its Of Counsel Retired Supreme Court Associate Justice Josue N.
Bellosillo18 (Intervenor), whereby the Intervenor sought, among others, that both Malvar and KFPI be held and
ordered to pay jointly and severally the Intervenors contingent fees.

ISSUE: Whether or not the Motion for Intervention to protect attorneys rights can prosper, and, if so, how
much could it recover as attorneys fees.

RULING:
A client has the absolute right to terminate the attorney-client relationship at any time with or without cause.
But this right of the client is not unlimited because good faith is required in terminating the relationship. The
limitation is based on Article 19 of the Civil Code, which mandates that [e]very person must, in the exercise of
his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and
good faith. The right is also subject to the right of the attorney to be compensated. This is clear from Section
26, Rule 138 of the Rules of CourtIt is basic that an attorney is entitled to have and to receive a just and
reasonable compensation for services performed at the special instance and request of his client. The attorney
who has acted in good faith and honesty in representing and serving the interests of the client should be
reasonably compensated for his service.
In the absence of the lawyers fault, consent or waiver, a client cannot deprive the lawyer of his just fees
already earned in the guise of a justifiable reason. Here, Malvar not only downplayed the worth of the
Intervenors legal service to her but also attempted to camouflage her intent to defraud her lawyer by offering
excuses that were not only inconsistent with her actions but, most importantly, fell short of being justifiable.
It is necessary to state that no court can shirk from enforcing the contractual stipulations in the manner they
have agreed upon and written. As a rule, the courts, whether trial or appellate, have no power to make or
modify contracts between the parties. Nor can the courts save the parties from disadvantageous provisions. The
same precepts hold sway when it comes to enforcing fee arrangements entered into in writing between clients
and attorneys. In the exercise of their supervisory authority over attorneys as officers of the Court, the courts
are bound to respect and protect the attorneys lien as a necessary means to preserve the decorum and
respectability of the Law Profession. Hence, the Court must thwart any and every effort of clients already
served by their attorneys worthy services to deprive them of their hard-earned compensation. Truly, the duty
of the courts is not only to see to it that attorneys act in a proper and lawful manner, but also to see to it that
attorneys are paid their just and lawful fees.

Atty. Oscar Embido, Regional Director National Bureau of Investigation, Western Visayas Regional
Officevs. Atty. Salvador Pe, Jr. Assistant Provincial Prosecutor of San Jose, Antique
A.C. No. 6732, October 22, 2013
BERSAMIN, J.:
A lawyer who forges a court decision and represents it as that of a court of law is guilty of the gravest
misconduct and deserves the supreme penalty of disbarment.
FACTS:
Atty. Ronel F. Sustituya, Clerk of Court of the RTC, received a written communication from Mr. Ballam
Delaney Hunt, a Solicitor in the United Kingdom (UK). The letter requested a copy of the decision dated
February 12, 1997 rendered by Judge Rafael O. Penuela in Special Proceedings Case No. 084 entitled In the
Matter of the Declaration of Presumptive Death of Rey Laserna, whose petitioner was one Shirley Quioyo. On
September 9, 2004, the RTC received another letter from Mr. Hunt, reiterating the request for a copy of the
decision in Special Proceedings Case No. 084 entitled In the Matter of the Declaration of Presumptive Death of
Rey Laserna. Judge Penuela instructed the civil docket clerk to retrieve the records of Special Proceedings Case
No. 084 entitled In the Matter of the Declaration of Presumptive Death of Rey Laserna. It was then discovered
that the RTC had no record of Special Proceedings No. 084 wherein Shirley Quioyo was the petitioner. Instead,
the court files revealed that Judge Penuela had decided Special Proceedings No. 084 entitled In the Matter of
the Declaration of Presumptive Death of Rolando Austria, whose petitioner was one Serena Catin Austria.
Informed that the requested decision and case records did not exist, Mr. Hunt sent a letter dated October 12,
2004 attaching a machine copy of the purported decision in Special Proceedings No. 084 entitled In the Matter
of the Declaration of Presumptive Death of Rey Laserna that had been presented by Shirley Quioyo in court
proceedings in the UK. After comparing the two documents and ascertaining that the document attached to the
October 12, 2004 letter was a falsified court document, Judge Penuela wrote Mr. Hunt to apprise him of the
situation. Dy Quioyo, a brother of Shirley Quioyo, executed an affidavit on March 4, 2005,7 wherein he stated
that it was the respondent who had facilitated the issuance of the falsified decision in Special Proceedings No.
084 entitled In the Matter of the Declaration of Presumptive Death of Rey Laserna for a fee of P60,000.00.

ISSUE: Whether or not the respondent was guilty of grave misconduct

RULING:
The respondent was guilty of grave misconduct for having authored the falsification of the decision in a non-
existent court proceeding. Canon 7 of the Code of Professional Responsibility demands that all lawyers should
uphold at all times the dignity and integrity of the Legal Profession. Rule 7.03 of the Code of Professional
Responsibility states that a lawyer shall not engage in conduct that adversely reflects on his fitness to practice
law, nor shall he whether in public or private life, behave in a scandalous manner to the discredit of the legal
profession. Lawyers are further required by Rule 1.01 of the Code of Professional Responsibility not to
engage in any unlawful, dishonest and immoral or deceitful conduct. Gross immorality, conviction of a crime
involving moral turpitude, or fraudulent transactions can justify a lawyers disbarment or suspension from the
practice of law. Specifically, the deliberate falsification of the court decision by the respondent was an act that
reflected a high degree of moral turpitude on his part. Worse, the act made a mockery of the administration of
justice in this country, given the purpose of the falsification, which was to mislead a foreign tribunal on the
personal status of a person. He thereby became unworthy of continuing as a member of the Bar.
It then becomes timely to remind all members of the Philippine Bar that they should do nothing that may in
any way or degree lessen the confidence of the public in their professional fidelity and integrity. The Court
will not hesitate to wield its heavy hand of discipline on those among them who wittingly and willingly fail to
meet the enduring demands of their Attorneys Oath.
No lawyer should ever lose sight of the verity that the practice of the legal profession is always a privilege that
the Court extends only to the deserving, and that the Court may withdraw or deny the privilege to him who fails
to observe and respect the Lawyers Oath and the canons of ethical conduct in his professional and private
capacities. He may be disbarred or suspended from the practice of law not only for acts and omissions of
malpractice and for dishonesty in his professional dealings, but also for gross misconduct not directly
connected with his professional duties that reveal his unfitness for the office and his unworthiness of the
principles that the privilege to practice law confers upon him. Verily, no lawyer is immune from the
disciplinary authority of the Court whose duty and obligation are to investigate and punish lawyer misconduct
committed either in a professional or private capacity. The test is whether the conduct shows the lawyer to be
wanting in moral character, honesty, probity, and good demeanor, and whether the conduct renders the lawyer
unworthy to continue as an officer of the Court.

Jocelyn de Leon vs. Atty. Tyrone Pedrea

A.C. No 9401, October 22, 2013
BERSAMIN, J.:
A lawyer who commits overt acts of sexual harassment against a female client is guilty of reprehensible
conduct that is unbecoming of a member of the Bar, and may be condignly punished with suspension from the
practice of law.
FACTS:
Jocelyn de Leon filed with the Integrated Bar of the Philippines (IBP) a complaint for disbarment or suspension
from the practice of law against Atty. Tyrone Pedrea, a Public Attorney. She averred in her complaintaffidavit
that Atty. Pedrea had sexually harassed her.
ISSUE: Whether or not Atty. Pedrea is liable

RULING:
The records show that Atty. Pedrea rubbed the complainants right leg with his hand; tried to insert his finger
into her firmly closed hand; grabbed her hand and forcibly placed it on his crotch area; and pressed his finger
against her private part. Given the circumstances in which he committed them, his acts were not merely
offensive and undesirable but repulsive, disgraceful and grossly immoral. They constituted misconduct on the
part of any lawyer. In this regard, it bears stressing that immoral conduct is gross when it is so corrupt as to
constitute a criminal act, or so unprincipled as to be reprehensible to a high degree, or when committed under
such scandalous or revolting circumstances as to shock the communitys sense of decency. The possession of
good moral character is both a condition precedent and a continuing requirement to warrant admission to the
Bar and to retain membership in the Legal Profession. Members of the Bar are clearly duty bound to observe
the highest degree of morality and integrity in order to safeguard the reputation of the Bar. Any errant behavior
on the part of a lawyer that tends to expose a deficiency in moral character, honesty, probity or good demeanor,
be it in the lawyers public or private activities, is sufficient to warrant the lawyers suspension or
disbarment.17 Section 27, Rule 138 of the Rules of Court, provides that a member of the Bar may be disbarred
or suspended for grossly immoral conduct, or violation of his oath as a lawyer. Towards that end, we have not
been remiss in reminding members of the Bar to live up to the standards and norms of the Legal Profession by
upholding the ideals and principles embodied in the Code of Professional Responsibility.
Atty. Pedreas misconduct was aggravated by the fact that he was then a Public Attorney mandated to provide
free legal service to indigent litigants, and by the fact that De Leon was then such a client. He also disregarded
his oath as a public officer to serve others and to be accountable at all times, because he thereby took advantage
of her vulnerability as a client then in desperate need of his legal assistance.

Heinz Heck vs. City Prosecutor Casiano Gamotin Jr,

A.C. No. 5329, March 18, 2014
BERSAMIN, J.:
A lawyer like the respondent is not to be sanctioned for every perceived misconduct or wrong actuation. He is
still to be presumed innocent of wrongdoing until the proof arrayed against him establishes otherwise. It is the
burden of the complainant to properly show that the assailed conduct or actuation constituted a breach of the
norms of professional conduct and legal ethics. Otherwise, the lawyer merits exoneration.
FACTS:
Heck filed of a criminal case for unjust vexation against Cabrera in the Office of the City Prosecutor
(OCP) in Cagayan de Oro City but the case was dismissed. Cabrera countered with two criminal cases against
Heck one charging the latter with illegal possession of firearms (I.S. No. 20001860) and the other with
unlawful incrimination of an innocent person (Criminal Case No. 1232). Atty. Adaza represented Cabrera in
both cases. The OCP initially dismissed I.S. No. 20001860 for insufficiency of evidence, but Atty. Adaza
moved for the reconsideration of the dismissal which was granted by the respondent. Heck challenged the order
of the respondent.
Heck claimed that the respondent scheduled a meeting at his office to be attended by Heck, his lawyer,
his wife and Atty. Adaza. However, Atty. Adaza did not attend the meeting. Heck alleged, however, that Atty.
Adaza and the respondent held their own separate private meeting, for which reason Heck questioned the
propriety of the private meeting and the possibility of connivance between the respondent and Atty. Adaza.
Heck went to the respondents office to pick up documents supposedly promised to him. But he was
denied the documents. He further alleged that Prosecutor Gamotin, Jr. entered his office, the door was held
open by a chair. Passing the door, Prosecutor Gamotin, Jr. furiously KICKED the chair who was holding the
door to his office open, sending the chair flying onto the other chairs at his conference table. Then he
SLAMMED the door, almost hitting the face of Mr. Coufal. Heck then asked why the respondent was still
entertaining Atty. Adaza despite his having been already suspended from the practice of law by the Supreme
Court.
It appears that Heck had filed administrative complaints against the respondent in the Department of
Justice (DOJ); as well as in the Office of the Ombudsman. The records were first referred to the Office of the
Court Administrator, then to the Office of the Bar Confidant (OBC) for evaluation of the merits of the
disbarment case against the respondent. The OBC observed that although there was no clear, convincing and
satisfactory evidence of misconduct as to warrant the penalty of disbarment, the respondents conduct should
be sanctioned; that his act of privately entertaining Atty. Adaza and his brother, as well as allowing his office to
be used for a meeting even in his absence raised doubt on his integrity; that the respondents reaction to Hecks
tirade against the countrys justice system, particularly the respondents retort that Heck should go back to his
country if he did not believe in the Philippine authorities, constituted decorum that was so unbecoming of a
lawyer.

ISSUE: Whether or not City Prosecutor Gamotin should be disbarred.

RULING: NO
We consider that the evidence adduced by the complainant insufficient to warrant the disbarment of the
respondent. A lawyer like the respondent is not to be sanctioned for every perceived misconduct or wrong
actuation. He is still to be presumed innocent of wrongdoing until the proof arrayed against him establishes
otherwise. It is the burden of the complainant to properly show that the assailed conduct or actuation
constituted a breach of the norms of professional conduct and legal ethics. Otherwise, the lawyer merits
exoneration.
To begin with, the holding of the meeting between Atty. Babarin, Hecks counsel, and Atty. Adaza in
the respondents office was not suspicious or irregular, contrary to the insinuation of Heck. We are not
unmindful of the practice of some legal practitioners to arrange to meet with their opposing counsels and their
clients in the premises of the offices of the public prosecutors or in the courthouses primarily because such
premises are either a convenient or a neutral ground for both sides
Secondly, we cannot sanction the respondent for having angrily reacted to Hecks unexpected tirade in
his presence. The respondent was not then reacting to an attack on his person, but to Hecks disrespectful
remark against Philippine authorities in general. Lawyers may be expected to maintain their composure and
decorum at all times, but they are still human, and their emotions are like those of other normal people placed
in unexpected situations that can crack their veneer of selfcontrol. The Court will not permit the respondents
good record to be tarnished by his having promptly reacted to Hecks remark.
Lastly, Heck complains that the respondent still entertained Atty. Adaza despite the latter having been
already suspended from the practice of law. The respondent explains, however, that he had no personal
knowledge of Atty. Adazas suspension and that such information was not properly disseminated to the proper
offices.
We are inclined to believe the respondents explanation. We believe that the respondent was not yet aware of
the suspension at that time. It was possible that at the occasion when Atty. Adaza appeared before the
respondent on September 15, 2000, his suspension had not yet attained finality, or that the order of suspension
had not yet been known to the respondent. Accordingly, it will be unjustified to hold the respondent liable for
allowing Atty. Adaza to practice law and to represent his client in the OCP of Cagayan de Oro City.

Benjamin Ong vs. Atty. William Delos Santos

A.C. No. 10179 (Formerly CBD 112985), March 04, 2014
BERSAMIN, J.:
Every lawyer is an officer of the Court. He has the duty and responsibility to maintain his good moral
character. In this regard, good moral character is not only a condition precedent relating to his admission into
the practice of law, but is a continuing imposition in order for him to maintain his membership in the
Philippine Bar. Any gross misconduct that puts his moral character in serious doubt renders him unfit to
continue in the practice of law.
FACTS:
According to complainant Ong, Atty. Delos Santos asked him to encash his postdated check inasmuch
as he was in dire need of cash. To reassure Ong that the check would be funded upon maturity, Atty. Delos
Santos bragged about his lucrative practice and his good paying clients. Convinced of Atty. Delos Santos
financial stability, Ong handed to Atty. Delos Santos on January 29, 2008 the amount of P100,000.00 in
exchange for the latters Metrobank Check No. 0110268 postdated February 29, 2008. However, the check was
dishonored upon presentment for the reason that the account was closed. Ong demanded immediate payment to
Atty. Delos Santos, but the latter just ignored him. When efforts to collect remained futile, Ong brought a
criminal complaint for estafa and for violation of Batas Pambansa Blg. 22. Ong also brought this disbarment
complaint against Atty. Delos Santos in the Integrated Bar of the Philippines (IBP). IBP Bar Commissioner
Jose I. Dela Rama, Jr. stated that Ong had sufficiently established the existence of the dishonored check. He
recommended that Atty. Delos Santos be held liable for violating Canon 1, Rule 1.01 and Canon 7, Rule 7.03
of the Code of Professional Responsibility. The IBP Board of Governors issued Resolution adopting and
approving the findings of IBP Commissioner.

ISSUE: Whether or not Atty. William F. Delos Santos shall be held administratively liable.
RULING:
We agree with the findings of the IBP but modify the recommended penalty.
Every lawyer is an officer of the Court. He has the duty and responsibility to maintain his good moral
character. In this regard, good moral character is not only a condition precedent relating to his admission into
the practice of law, but is a continuing imposition in order for him to maintain his membership in the Philippine
Bar. Any gross misconduct that puts his moral character in serious doubt renders him unfit to continue in the
practice of law.
Batas Pambansa Blg. 22 has been enacted in order to safeguard the interest of the banking system and
the legitimate public checking account users. The effects of the issuance of a worthless check transcends the
private interests of the parties directly involved in the transaction and touches the interests of the community at
large. The mischief it creates is not only a wrong to the payee or holder, but also an injury to the public. Being
a lawyer, Atty. Delos Santos was well aware of the objectives and coverage of Batas Pambansa Blg. 22. If he
did not, he was nonetheless presumed to know them, for the law was penal in character and application. His
issuance of the unfunded check involved herein knowingly violated Batas Pambansa Blg. 22, and exhibited his
16
indifference towards the pernicious effect of his illegal act to public interest and public order. He thereby
swept aside his Lawyers Oath that enjoined him to support the Constitution and obey the laws. He also took
for granted the express commands of the Code of Professional Responsibility, specifically Canon 1, Rule 1.01
and Canon 7, Rule 7.03.
Moreover, in issuing the dishonored check, Atty. Delos Santos put into serious question not only his
personal integrity but also the integrity of the entire Integrated Bar. It cannot be denied that Ong acceded to
Atty. Delos Santos request for encashment of the check because of his complete reliance on the nobility of the
Legal Profession.
Accordingly, Atty. Delos Santos was guilty of serious misconduct, warranting appropriate administrative
sanction. Noting that the criminal complaint charging him with the violation of Batas Pambansa Blg. 22 was
23
already dismissed, and that he already repaid to Ong the full amount of P100,000.00, both of which are
treated as mitigating circumstances in his favor, we find the recommendation of the IBP Board of Governors to
suspend him from the practice of law for a period of three years harsh. Thus, we reduce the penalty to
suspension from the practice of law to six months in order to accord with the ruling in Philippine Amusement
and Gaming Corporation v. Carandang.

Henry Samonte vs. Atty. Gines Abellana

A.C. No. 3452, June 23, 2014
BERSAMIN, J.:
A lawyer who willfully resorts to any falsehood in order to mislead the courts or his clients on the
status of their causes exhibits his unworthiness to remain a member of the Law Profession. This is because he
is always expected to be honest and forthright in his dealings with them. He thereby merits the condign
sanction of suspension from the practice of law, if not disbarment.
FACTS:
Complainant Henry E. Samonte brought this administrative complaint against respondent Atty. Gines N.
AbelJana who had represented him as the plaintiff in Civil Case entitled Capt. Henry E. Samonte v.
Authographics, Inc., and Nelson Yu of the Regional Trial Court in Cebu City. In the administrative complaint,
Samonte enumerated the serious acts of professional misconduct by Atty. Abellana, to wit:
1. Falsification of documents, when Atty. Abellana made it appear that he had filed Civil Case No. CEB-
6970 on June 10, 1988, conformably with their agreement, although the complaint was actually filed on
June 14, 1988;
2. Dereliction of duty, when Atty. Abellana failed to: (a) file the reply vis--vis the answer with
counterclaim, with his omission having delayed the pre-trial of the case; (b) inform the trial court
beforehand that Samonte could not be available on a scheduled hearing, thereby incurring for the
plaintiffs side an unexplained absence detrimental to Samonte as the plaintiff; and (c) submit an
exhibit required by the trial judge, only to eventually submit it three months later;
3. Gross negligence and tardiness in attending the scheduled hearings;
and
4. Dishonesty for not issuing official receipts for every cash payments made by Samonte for his court
appearances and his acceptance of the case.

In his comment, Atty. Abellana denied the charge of falsification of documents, clarifying that the actual
filing of the complaint could be made only on June 14, 1988 instead of on June 10, 1988 because Samonte had
not given enough money to cover the filing fees and other charges.
 On February 7, 2005, the IBP received a motion to quash from Atty. Abellana, seeking the dismissal of
the administrative complaint because of the lack of interest on the part of Samonte. On May 1, 2008, the IBP
Commission on Bar Discipline found Atty. Abellana negligent in handling certain aspects of his clients case.
The IBP Commission on Bar Discipline recommended the disbarment of Atty. Abellana, observing that
apart from his negligent handling of portions of the civil case, said respondent has shown a facility for utilizing
false and deceitful practices as a means to cover-up his delay and lack of diligence in pursuing the case of his
client. On June 5, 2008, the IBP Board of Governors, albeit adopting the findings of the IBP Investigating
Commissioner, suspended Atty. Abellana from the practice of law for one year.

ISSUE: Whether or not the suspension of Atty. Abellana shall be upheld.

RULING: YES
A lawyer who willfully resorts to any falsehood in order to mislead the courts or his clients on the
status of their causes exhibits his unworthiness to remain a member of the Law Profession. This is because
he is always expected to be honest and forthright in his dealings with them. He thereby merits the condign
sanction of suspension from the practice of law, if not disbarment.
In his dealings with his client and with the courts, every lawyer is expected to be honest, imbued with
integrity, and trustworthy. These expectations, though high and demanding, are the professional and ethical
burdens of every member of the Philippine Bar, for they have been given full expression in the Lawyers Oath
that every lawyer of this country has taken upon admission as a bona fide member of the Law Profession. By
the Lawyers Oath is every lawyer enjoined not only to obey the laws of the land but also to refrain from doing
any falsehood in or out of court or from consenting to the doing of any in court, and to conduct himself
according to the best of his knowledge and discretion with all good fidelity as well to the courts as to his
clients. It is by no means a coincidence; therefore, that honesty, integrity and trustworthiness are emphatically
reiterated by the Code of Professional Responsibility.
Atty. Abellana abjectly failed the expectations of honesty, integrity and trustworthiness in his dealings
with Samonte as the client, and with the RTC as the trial court. He resorted to outright falsification by
superimposing 0 on 4 in order to mislead Samonte into believing that he had already filed the complaint in
court on June 10, 1988 as promised, instead of on June 14, 1988, the date when he had actually done so.
Atty. Abellanas perfidy towards Samonte did not stop there. He continued misleading Samonte in
explaining his mishandling of the latters civil case. Worse, he also foisted his dishonesty on the Court no less.
The finding on Atty. Abellanas neglect in the handling of Samontes case was entirely warranted. He admitted
being tardy in attending the hearings of the civil case. He filed the formal offer of evidence in behalf of his
client way beyond the period to do so, a fact that he could not deny because the RTC Judge had himself
expressly noted the belated filing in the order issued in the case.
In the motion for reconsideration that he filed in the IBP Board of Governors, Atty. Abellana
challenged the sufficiency of the proof presented against him by Samonte, contending that such proof had
consisted of merely hearsay and self-serving evidence.
The contention of Atty. Abellana is bereft of substance. In disciplinary proceedings against lawyers,
clearly preponderant evidence is required to overcome the presumption of innocence in favor of the respondent
lawyers. Preponderant evidence means that the evidence adduced by one side is, as a whole, superior to or has
greater weight than that of the other. In order to determine if the evidence of one party is greater than that of the
other, Section 1, Rule 133 of the Rules of Court instructs that the court may consider the following, namely: (a)
all the facts and circumstances of the case; (b) the witnesses manner of testifying, their intelligence, their
means and opportunity of knowing the facts to which they are testifying, the nature of the facts to which they
testify, the probability or improbability of their testimony; (c) the witnesses interest or want of interest, and
also their personal credibility so far as the same may ultimately appear in the trial; and (d) the number of
witnesses, although it does not mean that preponderance is necessarily with the greater number. The
complainants evidence preponderantly established the administrative sins of Atty. Abellana.
The falsehoods committed by Atty. Abellana, being aimed at misleading his client and the Court to
bolster his unworthy denial of his neglect in the handling of the client's case, were unmitigated. Still, the Court
must not close its eyes to the fact that Atty. Abellana actually finished presenting his client's case; and that the
latter initiated the termination of Atty. Abellana's engagement as his counsel only after their relationship had
been tainted with mistrust. Thus, we determine the proper sanction. For Atty. Abellana, therefore, suspension
from the practice of law for six months with warning of a more severe sanction upon a repetition suffices.

Presiding Judge Jose Madrid vs. Atty. Juan Dealca

A.C. No. 7474, September 09, 2014
BERSAMIN, J.:
Although the Court always admires members of the Bar who are imbued with a high sense of vigilance to weed
out from the Judiciary the undesirable judges and inefficient or undeserving court personnel, any acts taken in
that direction should be unsullied by any taint of insincerity or self-interest.
FACTS:
On February 7, 2007, Atty. Juan S. Dealca entered his appearance in Criminal Case No. 2006-6795,
entitled People of the Philippines v. Philip William Arsenault presided by complainant Judge Jose L.
Madrid. But aside from entering his appearance as counsel for the accused, Atty. Dealca also moved that
Criminal Case No. 2006-6795 be re-raffled to another Branch of the RTC considering the adverse incidents
between the incumbent Presiding Judge and the undersigned, where he does not appear before the
incumbent Presiding Judge, and the latter does not also hear cases handled by the undersigned. Judge Madrid
denied Atty. Dealcas motion to re-raffle.
Consequently, Judge Madrid filed a letter complaint in the Office of the Bar Confidant citing Atty.
Dealcas unethical practice of entering his appearance and then moving for the inhibition of the presiding judge
on the pretext of previous adverse incidents between them. We treated the complaint as a regular administrative
complaint. On July 17, 2007, the Court referred the matter to the IBP for appropriate investigation, report and
recommendation.
On June 6, 2007, the Court in Yap v. Judge Madrid dismissed for its lack of merit the administrative
complaint against Judge Madrid for allegedly falsifying the transcript of stenographic notes of the hearing on
March 4, 2005 in Civil Case No. 2001-6842 entitled Joseph D. Yap V, et al. v. Joseph H. Yap III, but referred to
the Integrated Bar of the Philippines (IBP) for investigation, report and recommendation the propensity of
Atty. Dealca to file administrative or criminal complaints against judges and court personnel whenever
decisions, orders or processes were issued adversely to him and his clients.
In compliance with the referral, the IBP-Sorsogon Chapter submitted its report. The documentary
evidence offered by complainants show that respondent Atty. Juan S. Dealca filed by himself five (5) cases
which are factual evidence of the cases that respondent had filed by himself and as counsel for the
complainants against court officers, judges and personnel as a consequence of the IBP Election and incidents in
cases that respondent had handled as counsel for the parties in the said cases.
All these cases are precipitated by the adverse ruling rendered by the court against the clients of the
respondent that instead of resorting to the remedies available under the Rules of Procedure, respondent assisted
his clients in filing administrative and criminal case against the judges and personnel of the court. All these
documentary evidence from (a) to (e) are helpful in determining the PROPENSITY of the respondent as a
member of the bar in resorting to harassment cases instead of going through the procedures provided for by the
Rules of Court in the event of adverse ruling, order or decision of the court.
IBP Commissioner Salvador B. Hababag ultimately submitted his Report and Recommendation finding
Atty. Dealca guilty of violating the Lawyers Oath and the Code of Professional Responsibility by filing
frivolous administrative and criminal complaints; and recommending that Atty. Dealca be suspended from the
practice of law for one year because. In Resolution No. XVIII-2008-41, the IBP Board of Governors modified
the recommendation and dismissed the administrative complaint for its lack of merit.

ISSUES:
(1) Whether or not Atty. Dealca filed frivolous administrative and criminal complaints against judges and court
personnel in violation of the Lawyers Oath and the Code of Professional Responsibility

(2) Whether or not Atty. Dealca guilty of unethical practice in seeking the inhibition of Judge Madrid in
Criminal Case No. 2006-6795.

RULING:
Atty. Dealca must guard against his own impulse of initiating unfounded suits

Although the Court always admires members of the Bar who are imbued with a high sense of vigilance to
weed out from the Judiciary the undesirable judges and inefficient or undeserving court personnel, any acts
taken in that direction should be unsullied by any taint of insincerity or self-interest. It is for that reason that
Atty. Dealcas complaint against Judge Madrid has failed our judicious scrutiny, for the Court cannot find any
trace of idealism or altruism in the motivations for initiating it. Instead, Atty. Dealca exhibited his proclivity for
vindictiveness and penchant for harassment, considering that, as IBP Commissioner Hababag pointed out, his
bringing of charges against judges, court personnel and even his colleagues in the Law Profession had all
stemmed from decisions or rulings being adverse to his clients or his side. The Lawyers Oath is a source of
obligations and duties for every lawyer, and any violation thereof by an attorney constitutes a ground for
disbarment, suspension, or other disciplinary action. These are not mere facile words, drift and hollow, but a
sacred trust that must be upheld and keep inviolable. As a lawyer, therefore, Atty. Dealca was aware of his duty
under his Lawyers Oath not to initiate groundless, false or unlawful suits. The duty has also been expressly
embodied in Rule 1.03, Canon 1 of the Code of Professional Responsibility.
Moreover, Atty. Dealca must be mindful of his mission to assist the courts in the proper administration
of justice. He disregarded his mission because his filing of the unfounded complaints, including this one against
Judge Madrid, increased the workload of the Judiciary. Although no person should be penalized for the
exercise of the right to litigate, the right must nonetheless be exercised in good faith. Atty. Dealcas bringing of
the numerous administrative and criminal complaints against judges, court personnel and his fellow lawyers did
not evince any good faith on his part, considering that he made allegations against them therein that he could
not substantially prove, and are rightfully deemed frivolous and unworthy of the Courts precious time and
serious consideration.
Atty. Dealca was apparently referring to the minute resolutions the Court could have promulgated in
frequently dismissing his unmeritorious petitions. His arrogant posturing would not advance his cause now. He
thereby demonstrated his plain ignorance of the rules of procedure applicable to the Court. The minute
resolutions have been issued for the prompt dispatch of the actions by the Court. Whenever the Court then
dismisses a petition for review for its lack of merit through a minute resolution, it is understood that the
challenged decision or order, together with all its findings of fact and law, is deemed sustained or upheld, and
the minute resolution then constitutes the actual adjudication on the merits of the case. The dismissal of the
petition, or its denial of due course indicates the Courts agreement with and its adoption of the findings and
conclusions of the court a quo.
The requirement for stating the facts and the law does not apply to the minute resolutions that the Court
issues in disposing of a case. The Court explained why in Borromeo v. Court of Appeals: The [Supreme] Court
x x x disposes of the bulk of its cases by minute resolutions and decrees them as final and executory, as where a
case is patently without merit, where the issues raised are factual in nature, where the decision appealed from is
supported by substantial evidence and is in accord with the facts of the case and the applicable laws, where it is
clear from the records that the petition is filed merely to forestall the early execution of judgment and for non-
compliance with the rules. The resolution denying due course or dismissing the petition always gives the legal
basis.

YES. Atty. Dealca violated Canon 11 and Rule 11.04 of the Code of Professional Responsibility

Atty. Dealca maintains that Judge Madrid should have in good grace inhibited himself upon his
motion to inhibit in order to preserve confidence in the impartiality of the judiciary. However, IBP
Commissioner Hababag has recommended that Atty. Dealca be sanctioned for filing the motion to inhibit
considering that the motion, being purely based on his personal whims, was bereft of factual and legal bases.
The recommendation of IBP Commissioner Hababag is warranted.
Lawyers are licensed officers of the courts empowered to appear, prosecute and defend the legal causes
for their clients. As a consequence, peculiar duties, responsibilities and liabilities are devolved upon them by
law. Verily, their membership in the Bar imposes certain obligations upon them.
Atty. Dealcas averment that Judge Madrid did not hear cases being handled by him directly insinuated
that judges could choose the cases they heard, and could refuse to hear the cases in which hostility existed
between the judges and the litigants or their counsel. Such averment, if true at all, should have been assiduously
substantiated by him because it put in bad light not only Judge Madrid but all judges in general. Yet, he did not
even include any particulars that could have validated the averment. Nor did he attach any document to support
it. It was incumbent upon Atty. Dealca to establish by clear and convincing evidence the ground of bias and
prejudice in order to disqualify Judge Madrid from participating in a particular trial in which Atty. Dealca was
participating as a counsel. The latters bare allegations of Judge Madrids partiality or hostility did not suffice.
As such, Atty. Dealca clearly contravened his duties as a lawyer as expressly stated in Canon 11 and Rule
11.04.
On a final note, it cannot escape our attention that this is not the first administrative complaint to be
ever brought against Atty. Dealca. In Montano v. Integrated Bar of the Philippines, we reprimanded him for
violating Canon 22 and Rule 20.4, Canon 20 of the Code of Professional Responsibility, and warned him that a
repetition of the same offense would be dealt with more severely. Accordingly, based on the penalties the Court
imposed on erring lawyers found violating Canon 1, Rule 1.03, and Canon 11, Rule 11.04 of the Code, we
deem appropriate to suspend Atty. Dealca from the practice of law for a period one year.

Re: Anonymous Letter-Complaint on the Alleged Involvement and for Engaging in the Business of
Lending Money at Usurious Rates of Interest of Ms. Dolores Lopes
A.M. No. 2010-21-SC, September 30, 2014
BERSAMIN, J.:
An anonymous complaint is always received with great caution, originating as it does from a source unwilling
to identify himself or herself. But the mere anonymity of the source should not call for the outright dismissal of
the complaint on the ground of its being baseless or unfounded provided its allegations can be reliably verified
and properly substantiated by competent evidence.
FACTS:
An undated letter-complaint addressed to the Complaints and Investigation Division of the Office of
Administrative Services of the Supreme Court triggered this administrative matter. The letter-complaint,
purportedly sent by a concerned employee who chose to remain anonymous, assailed the profitable money-
lending with usurious interest scheme engaged in by respondents Dolores T. Lope, and Fernando M. Montalvo,
both of the Checks Disbursement Division of the Courts Fiscal Management and Budget Office, alleging that
the respondents had been involved in the money-lending activities targeting the low-salaried employees of the
Court; that such money-lending had been going on with the help of the personnel of the Checks Disbursement
Division of FMBO by enticing employees of the Court to pledge forthcoming benefits at a discounted rate.
In her memorandum, Lopez neither denied nor admitted the allegations against her. She dared the OAS
instead to allow her to confront the complainant head on and to openly address each issue. In his memorandum,
Montalvo dismissed the letter-complaint as maliciously sent for the purpose of tarnishing his reputation and the
reputation of his office. He denied being engaged in the lending business in the Court. Like Lopez, he
insinuated that the OAS had not required any comments from other employees and officials of the Court
against whom more serious accusations had been raised.
Lopez and Montalvo appeared before the CID for the clarificatory hearing. Specifically, Lopez denied
the allegation that she had lent money to around 300 court employees, and that she had held their ATM cards in
her custody as collateral; but admitted having lent money to only about 20 personnel of the janitorial agency
and to some low-ranking employees of the Court. Lopez acknowledged that she was the only person in the
Checks Disbursement Division of FMBO who had lent money, absolving Montalvo and the other members of
the staff of that office by saying that they had nothing to do with her transactions.
The OAS submitted its report, recommending dismissal of the letter-complaint against Montalvo for
lack of merit; but endorsed Lopezs suspension for thirty (30) days for lending money with interest to a number
of economically challenged employees and janitors; and directed her to immediately cease and desist from
engaging in any form of personal business and other financial transactions, with a warning that a repetition of
the same or similar act in the future will be dealt with more severely.

ISSUE: Whether or not the Lopez should be held administratively liable based on the anonymous letter
complaint.

RULING: YES
An anonymous complaint is always received with great caution, originating as it does from a source
unwilling to identify himself or herself. But the mere anonymity of the source should not call for the outright
dismissal of the complaint on the ground of its being baseless or unfounded provided its allegations can be
reliably verified and properly substantiated by competent evidence.
Here, therefore, the anonymous complaint has to be dealt with, and its veracity tested with utmost care,
for it points the finger of accusation at two employees of the Court for engaging in money-lending activities at
unconscionable rates of interest, with low-ranking employees of the Court as their targets. That such a
complaint, albeit anonymous, has been made impacts on their reputations as individuals as well as on their
integrity as personnel of the Court itself. We cannot ignore the complaint, hoping that it will be forgotten, but
must inquire into it and decide it despite the anonymity of the complainant.

Re: Montalvo

The Court concurs with the findings of the OAS that the complaint against Montalvo had no factual
basis. His involvement in money lending was not shown to be habitual, going on only as far as accommodating
his friends during their personal emergencies without imposing any interests. It is notable that Montalvo firmly
denied the allegations against him, and that Lopez corroborated his denial. Accordingly, the complaint against
Montalvo should be dismissed.

Re: Lopez
As to Lopez, no witnesses appeared during the investigation to prove the allegations of the complaint.
But the complaint should still be assessed on the basis of her several admissions in the course of the December
8, 2010 investigation.
 The Court agrees with the observations and findings of the OAS about Lopez having engaged in
money-lending activities. Her various admissions entirely belied her insistence that her activities did not
constitute money lending. The fact of her parting with her money in favor of another upon the condition that
the same amount would be paid back was exactly what constituted a loan under the law, particularly Article
1933 of the Civil Code.

Did Lopezs money-lending activities render her administratively liable?

Administrative Circular No. 5 (Re: Prohibition for All Officials and Employees of the Judiciary to
Work as Insurance Agents), has prohibited all officials and employees of the Judiciary from engaging directly
in any private business, vocation or profession, even outside their office hours. The prohibition has been at
ensuring that full-time officers and employees of the courts render full-time service, for only thereby could any
undue delays in the administration of justice and in the disposition of court cases be avoided.
Although many moonlighting activities were themselves legal acts that would be permitted or
tolerated had the actors not been employed in the public sector, moonlighting, albeit not usually treated as a
serious misconduct, can amount to a malfeasance in office by the very nature of the position held. In the case of
Lopez, her being the Chief of the Checks Disbursement Division of the FMBO, a major office of the Court
itself, surely put the integrity of the Checks Disbursement Division and the entire FMBO under so much
undeserved suspicion. We do not need to stress that she was expected to be circumspect about her acts and
actuations, knowing that the impression of her having taken advantage of her position and her having abused
the confidence reposed in her office and functions as such would thereby become unavoidable. There is no
doubt about her onerous lending activities greatly diminishing the reputation of her office and of the Court
itself in the esteem of the public.
No less that the Constitution itself impresses this expectation in Section 1 of its Article XI, to wit:
Public office is a public trust. Public officers and employees must at all times, be accountable to the people,
serve them with utmost responsibility, integrity, loyalty, and efficiency, act with patriotism and justice, and
lead modest lives. Lopez was quite aware that the foregoing declarative language of the Constitution on the
nature of her public office and her responsibilities as a public officer was not mere rhetoric expressing idealistic
sentiments, but a definite working standard and a statement of attainable goals that the actual deeds of the
public officers and employees should match. She plainly disregarded the Constitution.
The Court has invariably imposed commensurate sanctions upon court employees found and declared
to be violating Administrative Circular No. 5. The sanctions have depended on the gravity of the violations
committed and on the careful consideration of the personal records of the employees concerned, like their prior
administrative cases.
Based on the foregoing, Lopez committed simple misconduct, a less grave offense that is punishable
under Rule IV, Section 52 of the Revised Uniform Rules on Administrative Cases in the Civil Service by
suspension from one month and one day to six months for the first offense, and dismissal for the second
offense. Yet, although a first-time offender, she could not be punished with the minimum of the imposable
penalty because she clearly abused her being a high-ranking officer in the FMBO in conducting her private
transactions within court premises during office hours, thereby putting the image of the Judiciary in a bad light.
Hence, her appropriate penalty is suspension from office for three months without pay.

In ordering their investigation upon the anonymous complaint, the Court did not discriminate and
unfairly act against the respondents

In ordering the administrative investigation of the respondents, the Court was moved only by the most
laudable of purposes. To start with, the investigation would never be unfair because they would thereby be
accorded the full opportunity to be heard in order to clear themselves. And, secondly, they were not being
singled out because the Court has always acted upon every appropriate complaint or grievance anonymous or
not brought against officials and employees of the Judiciary without regard to their ranks or responsibilities,
including any of its sitting Members, the incumbent Justices of the third-level courts, and other active judges of
the first and second levels of the courts. Only last week did the Court remove a very senior Justice of the
Sandiganbayan for cause, and in his case there was not even any formal complaint brought against him. To
accuse the Court of unfairness and discrimination was, therefore, censurable.
Nonetheless, the Court accords to Montalvo and Lopez the reasonable opportunity to show cause why
they should not be disciplined or otherwise sanctioned for their censurable statements.

Jessie Campugan vs. Atty. Federico Tolentino Jr.

A.C. No. 8261, March 11, 2015
BERSAMIN, J.:
A lawyer may be disciplined for misconduct committed either in his professional or private capacity. The test is
whether his conduct shows him to be wanting in moral character, honesty, probity, and good demeanor, or
whether his conduct renders him unworthy to continue as an officer of the Court.
FACTS:
Atty. Victorio, Jr. had replaced Atty. Edgardo Abad as counsel of the complainants in a civil action they
brought to seek the annulment of Transfer Certificate of Title (TCT) No. N-290546 of the Registry of Deeds of
Quezon City in the first week of January 2007 in the Regional Trial Court (RTC) in Quezon City. They
impleaded as defendants Ramon and Josefina Ricafort, Juliet Vargas and the Register of Deeds of Quezon City.
They caused to be annotated on TCT No. N-290546 their affidavit of adverse claim, as well as the notice of lis
pendens. Atty. Tolentino, Jr. was the counsel of defendant Ramon and Josefina Ricafort. As the surviving
children of the late Spouses Antonio and Nemesia Torres, they inherited upon the deaths of their parents a
residential lotL that they discovered that TCT No. RT64333(35652) had been unlawfully cancelled and
replaced by TCT No. N290546 of the Register of Deeds of Quezon City under the names of Ramon and
Josefina Ricafort; and that, accordingly, they immediately caused the annotation of their affidavit of adverse
claim on TCT No. N-290546. It appears that the parties entered into an amicable settlement during the
pendency of Civil Case No. Q-07-59598 in order to end their dispute, whereby the complainants agreed to sell
the property and the proceeds thereof would be equally divided between the parties, and the complaint and
counterclaim would be withdrawn respectively by the complainants (as the plaintiffs) and the defendants.
Pursuant to the terms of the amicable settlement, Atty. Victorio, Jr. filed a Motion to Withdraw Complaint
dated February 26, 2008, which the RTC granted in its order dated May 16, 2008 upon noting the defendants
lack of objection thereto and the defendants willingness to similarly withdraw their counterclaim. The
complainants alleged that from the time of the issuance by the RTC of the order dated May 16, 2008, they
could no longer locate or contact Atty. Victorio, Jr. despite making several phone calls and visits to his office;
that they found out upon verification at the Register of Deeds of Quezon City that new annotations were made
on TCT No. N-290546.

ISSUE: Whether or not the respondent must be disbarred

RULING:
A lawyer may be disciplined for misconduct committed either in his professional or private capacity. The test is
whether his conduct shows him to be wanting in moral character, honesty, probity, and good demeanor, or
whether his conduct renders him unworthy to continue as an officer of the Court. Verily, Canon 7 of the Code
of Professional Responsibility mandates all lawyers to uphold at all times the dignity and integrity of the Legal
Profession. Lawyers are similarly required under Rule 1.01, Canon 1 of the same Code not to engage in any
unlawful, dishonest and immoral or deceitful conduct. Failure to observe these tenets of the Code of
Professional Responsibility exposes the lawyer to disciplinary sanctions as provided in Section 27, Rule 138 of
the Rules of Court.
The complainants allegations of the respondents acts and omissions are insufficient to establish any
censurable conduct against them. The duty of the Register of Deeds is ministerial in nature under Section 10 of
Presidential Decree No. 1529 (Property Registration Decree). A purely ministerial act or duty is one that an
officer or tribunal performs in a given state of facts, in a prescribed manner, in obedience to the mandate of a
legal authority, without regard to or the exercise of his own judgment upon the propriety or impropriety of the
act done. If the law imposes a duty upon a public officer and gives him the right to decide how or when the
duty shall be performed, such duty is discretionary, not ministerial. The duty is ministerial only when its
discharge requires neither the exercise of official discretion nor the exercise of judgment.
The Court finds no abuse of authority or irregularity committed by Atty. Quilala, Atty. Cunanan, and Atty.
Caluya, Jr. with respect to the cancellation of the notice of adverse claim and the notice of lis pendens
annotated on TCT No. N-290546. Whether or not the RTC order dated May 16, 2008 or the letter-request
dated June 30, 2008 had been falsified, fraudulent or invalid was not for them to determine inasmuch as their
duty to examine documents presented for registration was limited only to what appears on the face of the
documents. If, upon their evaluation of the letter-request and the RTC order, they found the same to be
sufficient in law and to be in conformity with existing requirements, it became obligatory for them to perform
their ministerial duty without unnecessary delay

Angelito Ramiscal and Mercedes Orzame vs. Atty. Edgar Orro

A.C. No. 10945, February 23, 2016
BERSAMIN, J.:
The fiduciary duty of every lawyer towards his client requires him to conscientiously act in advancing and
safeguarding the latter's interest. His failure or neglect to do so constitutes a serious breach of his Lawyer's
Oath and the canons of professional ethics, and renders him liable for gross misconduct that may warrant his
suspension from the practice of law.
FACTS:
Complainants Spouses Angelito Ramiscal and Mercedes Orzame (Ramiscals) engaged the legal services of
respondent Atty. Edgar S. Orro to handle a case in which they were the defendants seeking the declaration of
the nullity of title to a parcel of land situated in the Province of Isabela. Upon receiving the P10,000.00
acceptance fee from them, the respondent handled the trial of the case until the Regional Trial Court (RTC)
decided it in their favor. As expected, the plaintiffs appealed to the Court of Appeals (CA), and they ultimately
filed their appellants brief. Upon receipt of the appellants brief, the respondent requested from the
complainants an additional amount of P30,000.00 for the preparation and submission of their appellees brief in
the CA. They obliged and paid him the amount requested. CA reversed the decision of the RTC. The
respondent did not inform the Ramiscals of the adverse decision of the CA which they only learned about from
their neighbors. They endeavored to communicate with the respondent but their efforts were initially in vain.
When they finally reached him, he asked an additional P7,000.00 from them as his fee in filing a motion for
reconsideration in their behalf, albeit telling them that such motion would already be belated. Even so, they
paid to him the amount sought. To their dismay, they later discovered that he did not file the motion for
reconsideration; hence, the decision attained finality, eventually resulting in the loss of their property
measuring 8.479 hectares with a probable worth of P3,391,600.00. Ramiscals brought this administrative
complaint against the respondent.

ISSUE: Whether or not the respondent competently and diligently discharge his duties as the lawyer of the
Ramiscals

RULING:
Every lawyer, upon becoming a member of the Philippine Bar, solemnly takes the Lawyers Oath, by which he
vows, among others, that: I will delay no man for money or malice, and will conduct myself as a lawyer
according to the best of my knowledge and discretion, with all good fidelity as well to the courts as to my
clients. If he should violate the vow, he contravenes the Code of Professional Responsibility, particularly its
Canon 17, and Rules 18.03 and 18.04 of Canon 18. It is beyond debate, therefore, that the relationship of the
lawyer and the client becomes imbued with trust and confidence from the moment that the lawyer-client
relationship commences, with the lawyer being bound to serve his clients with full competence, and to attend to
their cause with utmost diligence, care and devotion. To accord with this highly fiduciary relationship, the
client expects the lawyer to be always mindful of the formers cause and to be diligent in handling the formers
legal affairs. As an essential part of their highly fiduciary relationship, the client is entitled to the periodic and
full updates from the lawyer on the developments of the case. The lawyer who neglects to perform his
obligations violates Rule 18.03 of Canon 18 of the Code of Professional Responsibility. But he obviously failed
to discharge his burdens to the best of his knowledge and discretion and with all good fidelity to his clients. By
voluntarily taking up their cause, he gave his unqualified commitment to advance and defend their interest
therein. Even if he could not thereby guarantee to them the favorable outcome of the litigation, he reneged on
his commitment nonetheless because he did not file the motion for reconsideration in their behalf despite
receiving from them the P7,000.00 he had requested for that purpose. He further neglected to regularly update
them on the status of the case, particularly on the adverse result, thereby leaving them in the dark on the
proceedings that were gradually turning against their interest. Updating the clients could have prevented their
substantial prejudice by enabling them to engage another competent lawyer to handle their case. As it
happened, his neglect in that respect lost for them whatever legal remedies were then available. His various
omissions manifested his utter lack of professionalism towards them. We further underscore that the
respondent owed it to himself and to the entire Legal Profession of the Philippines to exhibit due respect
towards the IBP as the national organization of all the members of the Legal Profession.

The Christian Spiritists in the Philippines, Inc. vs. Atty. Daniel Mangallay
A.C. No. 10483, March 16, 2016
BERSAMIN, J.:
Under the revisions of Rule 139-B, the administrative complaints against attorneys are generally not dismissed
outright but are instead referred for investigation, report and recommendation either to the IBP, or the Office
of the Bar Confidant (OBC), or any office of the Court or even a judge of a lower court.
FACTS:
Pante avers that the CSP-PLC constructed its church building on the land located in JE 176 Pico, La Trinidad,
Benguet, which was owned by Maria Omiles who had bought it from Larry Ogas; that Omiles and Pastor Elvis
Maliked received the summons issued by the Municipal Trial Court (MTC) of La Trinidad, Benguet requiring
them to answer the complaint for unlawful detainer filed against them by the respondent; that based on the
allegations of the complaint, the respondent claimed ownership of the land where the church of the CSP-PLC
had been erected, attaching the copy of deed of absolute sale executed between him and one Pedro Loy; that the
MTC later on decided the case by declaring the respondent to have the better right of possession. As earlier
mentioned, the respondent sought and obtained the writ of execution from the MTC after the defendants,
including the complainant, reneged on the promise to voluntarily vacate and surrender the premises in
consideration of the respondents financial assistance of P300,000.00. The writ of execution was issued and the
writ of demolition. Sheriffs Joselito S. Tumbaga and John Marie O. Ocasla, accompanied by the respondent
and elements of the Philippine National Police, implemented the writ of execution and writ of demolition.
Pante now insists that the demolition was done without a demolition order from the MTC; that the dismantled
materials worth P462,236.00 were forcibly taken away by the respondent, who had taken advantage of his legal
knowledge to cause the premature demolition of the structures sans the demolition order; that such taking away
of the dismantled materials constituted robbery and malicious mischief; and that his act warranted his
disbarment.

ISSUE: Whether or not respondent must be disbarred

RULING: No
Under the revisions of Rule 139-B, the administrative complaints against attorneys are generally not dismissed
outright but are instead referred for investigation, report and recommendation either to the IBP, or the Office of
the Bar Confidant (OBC), or any office of the Court or even a judge of a lower court. Such referral ensures that
the parties right to due process is respected as to matters that require further inquiry and which cannot be
resolved by the mere evaluation of the documents attached to the pleadings. Consequently, whenever the
referral is made by the Court, the IBP, the OBC or other authorized office or individual must conduct the
formal investigation of the administrative complaint, and this investigation is a mandatory requirement that
cannot be dispensed with except for valid and compelling reasons because it serves the purpose of threshing out
all the factual issues that no cursory evaluation of the pleadings can determine. However, the referral to the IBP
is not compulsory when the administrative case can be decided on the basis of the pleadings filed with the
Court, or when the referral to the IBP for the conduct of formal investigation would be redundant or
unnecessary, such as when the protraction of the investigation equates to undue delay. Dismissal of the case
may even be directed at the outset should the Court find the complaint to be clearly wanting in merit. Indeed,
the Rules of Court should not be read as preventing the giving of speedy relief whenever such speedy relief is
warranted. It is upon this that we dispense with the need to refer the complaint against the respondent to the
IBP for the conduct of the formal investigation. The documents he submitted to substantiate his denial of
professional wrongdoing are part of the records of the trial court, and, as such, are sufficient to establish the
unworthiness of the complaint as well as his lawful entitlement to the demolition of the structures of the
defendants in Civil Case No. R-1256.
Specifically, the demolition was authorized by the order issued by the MTC on December 19, 2013. In the
execution of the final and executory decision in Civil Case No. R-1256, the sheriffs dutifully discharged their
functions. The presence of the respondent during the execution proceedings was by no means irregular or
improper, for he was the plaintiff in Civil Case No. R-1256. The complainant was then represented by Pante
and some other members of the congregation, who did not manifest any resistance or objection to any
irregularity in the conduct of the execution. After all, elements of the Philippine National Police were also
present to ensure the peaceful implementation of the writ of execution. Neither do we find anything wrong,
least of all criminal, in the act of the respondent of taking away the materials of the demolished structures. The
parties put an end to their dispute by the defendants, including the complainant and Pante, opting to withdraw
their notice of appeal and undertaking to voluntarily vacate and to peacefully turn over the premises to the
respondent by August 31, 2013 in exchange for the latters financial assistance.

Nenita Sanchez vs. Atty Romeo Aguilos

A.C. No. 10543, March 16, 2016
BERSAMIN, J.:
The attorneys fees shall be those stipulated in the retainers agreement between the client and the attorney,
which constitutes the law between the parties for as long as it is not contrary to law, good morals, good
customs, public policy or public order. In the absence of the written agreement, the lawyers compensation
shall be based on quantum meruit, which means as much as he deserved.
FACTS:
Complainant Nenita D. Sanchez has charged respondent with misconduct for the latter's refusal to return the
amount of P70,000.00 she had paid for his professional services despite his not having performed the
contemplated professional services. She avers that in March 2005, she sought the legal services of the
respondent to represent her in the annulment of her marriage with her estranged husband, Jovencio C. Sanchez;
that the respondent accepted the engagement, fixing his fee at P150,000.00, plus the appearance fee of
P5,000.00/hearing; that she then gave to him the initial amount of P90,000.00; that she had gone to his
residence in May 2005 to inquire on the developments in her case, but he told her that he would only start
working on the case upon her full payment of the acceptance fee; that she had only learned then that what he
had contemplated to file for her was a petition for legal separation, not one for the annulment of her marriage;
that he further told her that she would have to pay a higher acceptance fee for the annulment of her marriage;
that she subsequently withdrew the case from him, and requested the refund of the amounts already paid, but he
refused to do the same as he had already started working on the case; that she had sent him a letter, through
Atty. Isidro S.C. Martinez, to demand the return of her payment less whatever amount corresponded to the legal
services he had already performed; that the respondent did not heed her demand letter despite his not having
rendered any appreciable legal services to her; and that his constant refusal to return the amounts prompted her
to bring an administrative complaint against him in the Integrated Bar of the Philippines.

ISSUE: Does quantum meruit attach when an attorney fails to accomplish tasks which he is naturally expected
to perform during his professional engagement?

RULING:
Respondent was liable for misconduct, and he should be ordered to return the entire amount received
from the client
Respondent misrepresented his professional competence and skill to the complainant. As the foregoing findings
reveal, he did not know the distinction between the grounds for legal separation and for annulment of marriage.
Such knowledge would have been basic and expected of him as a lawyer accepting a professional engagement
for either causes of action. His explanation that the client initially intended to pursue the action for legal
separation should be disbelieved. The case unquestionably contemplated by the parties and for which his
services was engaged, was no other than an action for annulment of the complainants marriage with her
husband with the intention of marrying her British fiance. They did not contemplate legal separation at all, for
legal separation would still render her incapacitated to re-marry. That the respondent was insisting in his
answer that he had prepared a petition for legal separation, and that she had to pay more as attorneys fees if she
desired to have the action for annulment was, therefore, beyond comprehension other than to serve as a hallow
afterthought to justify his claim for services rendered. As such, the respondent failed to live up to the standards
imposed on him as an attorney. He thus transgressed Canon 18, and Rules 18.01, 18.02 and 18.03 of the Code
of Professional Responsibility.
Every attorney is entitled to have and receive a just and reasonable compensation for services performed at the
special instance and request of his client. As long as the attorney is in good faith and honestly trying to
represent and serve the interests of the client, he should have a reasonable compensation for such services. The
attorneys fees shall be those stipulated in the retainers agreement between the client and the attorney, which
constitutes the law between the parties for as long as it is not contrary to law, good morals, good customs,
public policy or public order. In the absence of the written agreement, the lawyers compensation shall be based
on quantum meruit, which means as much as he deserved. The determination of attorneys fees on the basis
of quantum meruit is also authorized when the counsel, for justifiable cause, was not able to finish the case to
its conclusion. Moreover, quantum meruit becomes the basis of recovery of compensation by the attorney
where the circumstances of the engagement indicate that it will be contrary to the parties expectation to
deprive the attorney of all compensation.
The respondent should not have accepted the engagement because as it was later revealed, it was way above his
ability and competence to handle the case for annulment of marriage. As a consequence, he had no basis to
accept any amount as attorneys fees from the complainant. He did not even begin to perform the contemplated
task he undertook for the complainant because it was improbable that the agreement with her was to bring the
action for legal separation. His having supposedly prepared the petition for legal separation instead of the
petition for annulment of marriage was either his way of covering up for his incompetence, or his means of
charging her more. Either way did not entitle him to retain the amount he had already received.

Ma. Cecilia Advincula vs. Atty. Leonardo Advincula

A.C. No. 9226, June 14, 2016
BERSAMIN, J.:
The good moral conduct or character must be possessed by lawyers at the time of their application for
admission to the Bar, and must be maintained until retirement from the practice of law. It is expected that every
lawyer, being an officer of the Court, must not only be in fact of good moral character, but must also be seen to
be of good moral character and leading lives in accordance with the highest moral standards of the
community.
FACTS:
Dr. Advincula has averred that Atty. Advincula committed unlawful and immoral acts; that while Atty.
Advincula was still married to her, he had extra-marital sexual relations with Ma. Judith Ortiz Gonzaga; that
the extra-marital relations bore a child in the name of Ma. Alexandria Gonzaga Advincula; that Atty. Advincula
failed to give financial support to their own children, namely: Ma. Samantha Paulina, Ma. Andrea Lana, and
Jose Leandro, despite his having sufficient financial resources; that he admitted in the affidavit of late
registration of birth of Alexandria that he had contracted another marriage with Ms. Gonzaga; that even should
Atty. Advincula prove that his declaration in the affidavit of late registration of birth was motivated by some
reason other than the fact that he truly entered into a subsequent marriage with Ms. Gonzaga, then making such
a declaration was in itself still unlawful; that siring a child with a woman other than his lawful wife was
conduct way below the standards of morality required of every lawyer; that contracting a subsequent marriage
while the first marriage had not been dissolved was also an unlawful conduct; that making a false declaration
before a notary public was an unlawful conduct punishable under the Revised Penal Code; and that the failure
of Atty. Advincula to provide proper support to his children showed his moral character to be below the
standards set by law for every lawyer. Dr. Advincula prayed that Atty. Advincula be disbarred.

ISSUE: Whether or not respondent must be disbarred.

RULING: No
The good moral conduct or character must be possessed by lawyers at the time of their application for
admission to the Bar, and must be maintained until retirement from the practice of law. It is expected that every
lawyer, being an officer of the Court, must not only be in fact of good moral character, but must also be seen to
be of good moral character and leading lives in accordance with the highest moral standards of the community.
More specifically, a member of the Bar and officer of the Court is required not only to refrain from adulterous
relationships or keeping mistresses but also to conduct himself as to avoid scandalizing the public by creating
the belief that he is flouting those moral standards. If the practice of law is to remain an honorable profession
and attain its basic ideals, whoever is enrolled in its ranks should not only master its tenets and principles but
should also, in their lives, accord continuing fidelity to them. The requirement of good moral character is of
much greater import, as far as the general public is concerned, than the possession of legal learning.
Although his siring the child with a woman other than his legitimate wife constituted immorality, he committed
the immoral conduct when he was not yet a lawyer. The degree of his immoral conduct was not as grave than if
he had committed the immorality when already a member of the Philippine Bar. Even so, he cannot escape
administrative liability. Taking all the circumstances of this case into proper context, the Court considers
suspension from the practice of law for three months to be condign and appropriate.
Atty. Advincula manifested in his compliance dated February 26, 2013 that he had immediately accepted the
resolution of the IBP Board of Governors suspending him from the practice of law for two months as final and
executory; that he had then gone on leave from work in the NBI for two months starting in November and
lasting until the end of December, 2012; and that such leave from work involved refraining from performing
his duties as a Legal Officer of the NBI. A lawyer like him ought to know that it is only the Court that wields
the power to discipline lawyers. The IBP Board of Governors did not possess such power, rendering its
recommendation against him incapable of finality. It is the Court's final determination of his liability as a
lawyer that is the reckoning point for the service of sanctions and penalties. As such, his supposed compliance
with the recommended two-month suspension could not be satisfied by his going on leave from his work at the
NBI. Moreover, his being a government employee necessitates that his suspension from the practice of law
should include his suspension from office. A leave of absence will not suffice. This is so considering that his
position mandated him to be a member of the Philippine Bar in good standing. The suspension from the
practice of law will not be a penalty if it does not negate his continuance in office for the period of the
suspension. If the rule is different, this exercise of reprobation of an erring lawyer by the Court is rendered
inutile and becomes a mockery because he can continue to receive his salaries and other benefits by simply
going on leave for the duration of his suspension from the practice of law.
 -..,
I
:
I

U.P. College of Law

First Semester Schoolyear 2016-17
Local Governmen ts
By: Prof. V ictoria V. Loanzon

Course Objectives:
I. To provide the students with both the constitutional and statutory frameworks
covering municipal corporations.
2. To make students aware of the factors in the creation, merger and abolition of local
government units.
3. To make the students differentiate the types of local government units and their
corresponding role in national and local governance including the functions of
special bodies under the Local Government Code (LGC).
4. To know the extent of the powers exercised by local government units and their
liabilities including those of officers and employees under contracts and for tort.
5. To know how local officials are elected and appointed and how they are subjected to
disciplinary action.

Note: In reading assigned cases, please pay particu lar attention to portions of the decision
which relate to the topic for discussion.

J. INTRODUCTION (Week I )
A. Overview, Local Govern men ts (also referred to as m unicipal or pu blic
corporations) as pa rt of the Execu tive Bra nch
Sections 2 and 4, A rticle X, Consti tution and Section 25, Local Govern ment
Code (LGC)
Cases: Province of Batang as v. Romul o, 429 SCRA 736 (2004): share in IRA m ust
be released without any cond it ion; u phold ing the principl e of local autonomy on
share in the national income
National liga ng mga Barangay v. Paredes, G.R. No. 1 52774, May 27, 2004: DI LG
cannot intervene i n the i nternal affa i rs of t he L iga ng mga Barangay provided the
Liga compl ies with the req ui remen ts of t h e law ; pri nci ple of local autonomy even at
the barangay level
B. Brief History of Local Govern men ts/M u nicipal Corpora tions/Pu blic
Corporations in the Philippines
Cases:Municipality of Catbalogan v. Dir ector of lands, 17 Phil 216: a pol itica l
subdi vision has an independent jurid ical entity; as a political entity, it exercises bot h
governmental and proprietary functions .
Mondano v. Silvosa , 97 Phil 175 ( 1955): a local executi ve's personal crim i nal
l iabi lity is distinct from the discharge of h is responsibil ity as a mayor.

c. Natu re and Status

I. Definition of M u nici pal Corpora tion / Local Govern men t (Sec. 6, LGC)
2. M u nicipal Corpora tions as Ju ridical E n tities
Refer to releva nt Civi l Code provision s on jurid ical persons, state and poli t ical
subd ivisions
Title I - Civil Personali ty, Ci vil Code
Book I - Article 37, provi sions on jurid ical capacity
Chapter 2 - Nat ural Persons
Chapter 3 - Juridical Persons incl ude the state and its political subd i vision.
Sec. I5 of LGC
Cases: Homeowners Association of Ta/aya n Village v. J. M Tuason & Co., er al..
G .R.No. 203883 and G.R. No . 203930, Nov. I0, 2015: donation of common
areas in a private subd ivision to a local government uni t must be perfected with
J I t ' .: .
 A CADEMICUS REVIEW CENTER
Dean Ferdinand A. Tan

POLITICAL LAW CASES ( 2012 - 2016)

J. BERSAMIN

Nelson Lai vs. People of the Philippines

G. R. No. 17599, July 1, 2015
BERSAMIN, J.:
The Constitution has expressly ordained that "no person shall be deprived of life, liberty or property
without due process of law." An essential part of the right is to be afforded a just and fair trial before
his conviction for any crime. Any violation of the right cannot be condoned, for the impartiality of the
judge who sits on and hears a case, and decides it is an indispensable requisite of procedural due
process.
FACTS:
The accused assails the affirmance of his conviction for homicide through the assailed decision
promulgated on May 27, 2005 by the Court of Appeals (CA). The conviction had been handed down
by Judge Fernando R. Elumba of the Regional Trial Court, Branch 42, in Bacolod City (RTC). The
accused alleging that he was deprived of due process when this case was decided by the Honorable
Presiding Judge who acted as the public prosecutor in this case before he was appointed to the bench.

ISSUE: Whether Lai was denied of due process because of the non-disqualification of Judge Elumba?

RULING: Yes.
It is not disputed that the constitutional right to due process of law cannot be denied to any accused.
The Constitution has expressly ordained that "no person shall be deprived of life, liberty or property
without due process of law." An essential part of the right is to be afforded a just and fair trial before
his conviction for any crime. Any violation of the right cannot be condoned, for the impartiality of the
judge who sits on and hears a case, and decides it is an indispensable requisite of procedural due
process.

The Court has repeatedly and consistently demanded 'the cold neutrality of an impartial judge' as the
indispensable imperative of due process. To bolster that requirement, it has been held that the judge
must not only be impartial but must also appear to be impartial as an added assurance to the parties
that his decision will be just.

In support to this, Section 1 of Rule 137 contemplates two kinds of self-disqualification. The first
paragraph enumerates the instances when the judge is prohibited and disqualified from sitting on and
deciding a case. The prohibition is compulsory simply because the judge is conclusively presumed to
be incapable of impartiality. The second paragraph speaks of voluntary inhibition; whether or not the
judge can sit in and try the case is left to his discretion, depending on the existence of just and valid
reasons not included in the first paragraph, but in exercising the discretion, he must rely only on his
conscience. In relation to this, Section 5, Canon 3 of the New Code of Judicial Conduct for the
Philippine Judiciary, which pertinently demands the disqualification of a judge who has previously
served as a lawyer of any of the parties.

As such, the mere appearance of his name as the public prosecutor in the records of the case
sufficed to disqualify Judge Elumba from sitting on and deciding the case. Having represented the
State in the prosecution of the petitioner, he could not sincerely claim neutrality or impartiality as the
trial judge who would continue to hear the case. Hence, he should have removed himself from being
the trial judge in the case.

Judge Elumba's prior participation as the public prosecutor was passive, or that he entered his
appearance as the public prosecutor long after the Prosecution had rested its case against the petitioner
did not really matter. The evil sought to be prevented by the rules on disqualification had no relation
whatsoever with the judge's degree of participation in the case before becoming the judge.

Under the circumstances, Judge Elumba, despite his protestations to the contrary, could not be
expected to render impartial, independent and objective judgment on the criminal case of the
petitioner. His non-disqualification resulted in the denial of the petitioner's right to due process as the
accused.

Land Bank of the Philippines vs. Veronica Nable

G.R. No. 176692, June 27, 2012
BERSAMIN, J.:
Section 4, Article XIII, of the Constitution has mandated the implementation of an agrarian reform
program for the distribution of agricultural lands to landless farmers subject to the payment of just
compensation to the landowners
FACTS:
Veronica Atega Nable (Nable) was the sole owner of a landholding consisting of three
contiguous agricultural lots situated in Barangay Taligaman, Butuan City and covered by Original
Certificate of Title (OCT) No. P-5 whose total area aggregated to 129.4615 hectares. She had
inherited the landholding from her late parents, Spouses Pedro C. Atega and Adela M. Atega. In 1993,
the Department of Agrarian Reform (DAR) compulsorily acquired a portion of the landholding with
an area of 127.3365 hectares pursuant to Republic Act No. 6657 (Comprehensive Agrarian Reform
Law of 1988, or CARL). LBP valued the affected landholding at only 5,125,036.05, but Nable
rejected the valuation. Department of Agrarian Reform Adjudication Board (DARAB) affirmed the
valuation of LBP. Nable instituted against DAR and LBP a petition for the judicial determination of
just compensation in the RTC in Butuan City, praying that the affected landholding and its
improvements be valued at 350,000.00/hectare, for an aggregate valuation of 44,567,775.00.
During pre-trial, the parties agreed to refer the determination of just compensation to a board of
commissioners, who recommends 57,660,058.00 as the just compensation for Nable.

ISSUE: Whether or not the computation of just compensation was proper

RULING: Yes
The CA and the RTC did not disregard Section 17, Republic Act No. 6657, and DAR AO No. 5,
Series of 1998
Section 4, Article XIII, of the Constitution has mandated the implementation of an agrarian
reform program for the distribution of agricultural lands to landless farmers subject to the payment of
just compensation to the landowners. The Congress has later enacted Republic Act No. 6657 to
implement the constitutional mandate. The Congress has thereby required that any determination of
just compensation should consider the following factors, namely: (a) the cost of the acquisition of the
land; (b) the current value of like properties; (c) the nature, actual use and income of the land; (d) the
sworn valuation by the owner; (e) the tax declarations; (f) the assessment made by government
assessors; (g) the social and economic benefits contributed to the property by the farmers and
farmworkers and by the Government; and (h) the fact of the non-payment of any taxes or loans
secured from any government financing institution on the land.
We cannot fail to note that the computation by the CA closely conformed to the factors listed
in Section 17 of Republic Act No. 6657, especially the factors of the actual use and income of the
affected landholding. The Court has consistently ruled that the ascertainment of just compensation by
the RTC as SAC on the basis of the landholdings nature, location, market value, assessors value, and
the volume and value of the produce is valid and accords with Section 17, supra. The Court has
likewise ruled that in appraising just compensation the courts must consider, in addition, all the facts
regarding the condition of the landholding and its surroundings, as well as the improvements and the
capabilities of the landholding. Thus, we sustain the computation.

Farming Experience and Rule of Thumb Method of Conversion are relevant to the statutory
factors for determining just compensation
The Court finds nothing objectionable or irregular in the use by the RTC of the assailed
the farming experience and the thumb method of conversion tests. Such tests are not inconsistent or
incompatible with the factors listed in Section 17 of Republic Act No. 6657, as the aforequoted
elucidation of the RTC shows. Although Section 17 of Republic Act No. 6657 has not explicitly
mentioned the farming experience and the thumb method of conversion as methods in the
determination of just compensation, LBP cannot deny that such methods were directly relevant to the
factors listed in Section 17, particularly those on the nature, actual use and income of the landholding.

People of the Philippines vs. Gilbert Reyes Wagas

G. R. No. 157943, September 4, 2013
BERSAMIN, J.:
The Bill of Rights guarantees the right of an accused to be presumed innocent until the contrary is
proved. In order to overcome the presumption of innocence, the Prosecution is required to adduce
against him nothing less than proof beyond reasonable doubt. Such proof is not only in relation to the
elements of the offense, but also in relation to the identity of the offender. If the Prosecution fails to
discharge its heavy burden, then it is not only the right of the accused to be freed, it becomes the
Court's constitutional duty to acquit him.
FACTS:
Wagas was charged with estafa. At the trial, the Prosecution presented complainant Alberto Ligaray
as its lone witness. Ligaray testified that on April 30, 1997, Wagas placed an order for 200 bags of
rice over the telephone; that he and his wife would not agree at first to the proposed payment of the
order by postdated check, but because of Wagas assurance that he would not disappoint them and that
he had the means to pay them because he had a lending business and money in the bank, they relented
and accepted the order; that he released the goods to Wagas on April 30, 1997 and at the same time
received Bank of the Philippine Islands (BPI) Check No. 0011003 for P200,000.00 payable to cash
and postdated May 8, 1997; that he later deposited the check with Solid Bank, his depository bank,
but the check was dishonored due to insufficiency of funds;5 that he called Wagas about the matter,
and the latter told him that he would pay upon his return to Cebu; and that despite repeated demands,
Wagas did not pay him.
On cross-examination, Ligaray admitted that he did not personally meet Wagas because they
transacted through telephone only; that he released the 200 bags of rice directly to Robert Caada, the
brother-in-law of Wagas, who signed the delivery receipt upon receiving the rice. Wagas himself
testified. He admitted having issued BPI Check No. 0011003 to Caada, his brother-in-law, not to
Ligaray. He denied having any telephone conversation or any dealings with Ligaray. He explained
that the check was intended as payment for a portion of Caadas property that he wanted to buy, but
when the sale did not push through, he did not anymore fund the check.

ISSUE: Did the Prosecution establish beyond reasonable doubt the existence of all the elements of the
crime of estafa as charged, as well as the identity of the perpetrator of the crime?

RULING:
In order to constitute estafa under this statutory provision, the act of postdating or issuing a check in
payment of an obligation must be the efficient cause of the defraudation. This means that the offender
must be able to obtain money or property from the offended party by reason of the issuance of the
check, whether dated or postdated. In other words, the Prosecution must show that the person to
whom the check was delivered would not have parted with his money or property were it not for the
issuance of the check by the offender. The essential elements of the crime charged are that: (a) a check
is postdated or issued in payment of an obligation contracted at the time the check is issued; (b) lack
or insufficiency of funds to cover the check; and (c) damage to the payee thereof. It is the criminal
fraud or deceit in the issuance of a check that is punishable, not the non-payment of a debt. Prima
facie evidence of deceit exists by law upon proof that the drawer of the check failed to deposit the
amount necessary to cover his check within three days from receipt of the notice of dishonor.
The Prosecution established that Ligaray had released the goods to Caada because of the postdated
check the latter had given to him; and that the check was dishonored when presented for payment
because of the insufficiency of funds. In every criminal prosecution, however, the identity of the
offender, like the crime itself, must be established by proof beyond reasonable doubt. In that regard,
the Prosecution did not establish beyond reasonable doubt that it was Wagas who had defrauded
Ligaray by issuing the check.
Firstly, Ligaray expressly admitted that he did not personally meet the person with whom he was
transacting over the telephone. Even after the dishonor of the check, Ligaray did not personally see
and meet whoever he had dealt with and to whom he had made the demand for payment, and that he
had talked with him only over the telephone. Secondly, the check delivered to Ligaray was made
payable to cash. It bears stressing that the accused, to be guilty of estafa as charged, must have used
the check in order to defraud the complainant. What the law punishes is the fraud or deceit, not the
mere issuance of the worthless check. Wagas could not be held guilty of estafa simply because he had
issued the check used to defraud Ligaray. The proof of guilt must still clearly show that it had been
Wagas as the drawer who had defrauded Ligaray by means of the check.
It is a fundamental rule in criminal procedure that the State carries the onus probandi in establishing
the guilt of the accused beyond a reasonable doubt, as a consequence of the tenet ei incumbit
probation, qui dicit, non qui negat, which means that he who asserts, not he who denies, must prove,
and as a means of respecting the presumption of innocence in favor of the man or woman on the dock
for a crime. Accordingly, the State has the burden of proof to show: (1) the correct identification of
the author of a crime, and (2) the actuality of the commission of the offense with the participation of
the accused. All these facts must be proved by the State beyond reasonable doubt on the strength of its
evidence and without solace from the weakness of the defense. That the defense the accused puts up
may be weak is inconsequential if, in the first place, the State has failed to discharge the onus of his
identity and culpability. The presumption of innocence dictates that it is for the Prosecution to
demonstrate the guilt and not for the accused to establish innocence. Indeed, the accused, being
presumed innocent, carries no burden of proof on his or her shoulders. For this reason, the first duty of
the Prosecution is not to prove the crime but to prove the identity of the criminal. For even if the
commission of the crime can be established, without competent proof of the identity of the accused
beyond reasonable doubt, there can be no conviction.
There is no question that an identification that does not preclude a reasonable possibility of mistake
cannot be accorded any evidentiary force. Thus, considering that the circumstances of the
identification of Wagas as the person who transacted on the rice did not preclude a reasonable
possibility of mistake, the proof of guilt did not measure up to the standard of proof beyond
reasonable doubt demanded in criminal cases. Perforce, the accuseds constitutional right of
presumption of innocence until the contrary is proved is not overcome, and he is entitled to an
acquittal, even though his innocence may be doubted.

People of the Philippines vs. Sandiganbayan

G.R. No. 188165, December 11, 2013
BERSAMIN, J.:
The guarantee of the speedy disposition of cases under Section 16 of Article III of the Constitution
applies to all cases pending before all judicial, quasi-judicial or administrative bodies. Thus, the fact-
finding investigation should not be deemed separate from the preliminary investigation conducted by
the Office of the Ombudsman if the aggregate time spent for both constitutes inordinate and
oppressive delay in the disposition of any case.
FACTS:
Congressman Wilfrido B. Villarama of Bulacan (Cong. Villarama) delivered a privilege speech in the
House of Representatives denouncing acts of bribery allegedly committed by a high ranking
government official whom he then called the 2 Million Dollar Man. In reaction, the Office of the
President directed the Presidential AntiGraft and Commission (PAGC) to conduct an inquiry on the
expos of Cong. Villarama. PAGC sent written communications to Cong. Villarama, Cong. Mark
Jimenez, Senator Panfilo Lacson and respondent Secretary of Justice Hernando B. Perez inviting them
to provide information and documents on the alleged bribery subject of the expos. On November 18,
2002, Cong. Villarama responded by letter to PAGCs invitation by confirming that Secretary Perez
was the government official who ha[d] knowledge or connection with the bribery subject of his
expose. In his own letter of November 18, 2002, however, Secretary Perez denied being the Million-
Dollar Man referred to in Cong. Villaramas privilege speech. On November 25, 2002, Cong. Jimenez
delivered a privilege speech in the House of Representatives confirming Cong. Villaramas expos,
and accusing Secretary Perez of extorting US$2 Million from him in February 2001.
On November 25, 2002, then Ombudsman Simeon Marcelo requested PAGC to submit documents
relevant to the expos.6 On November 26, 2002, Ombudsman Marcelo formally requested Cong.
Jimenez to submit a sworn statement on his expos.7 Cong. Jimenez complied on December 23, 2002
by submitting his complaint-affidavit to the Office of the Ombudsman. The complaint-affidavit of
Jimenez for the criminal case in which the respondents were Secretary Perez, Ernest L. Escaler and
Ramon C. Arceo, Jr.; and as OMB-C-A-02-0631L, for the administrative case involving only
Secretary Perez as respondent was redocketed.
The information alleging the violation of Section 3(b) of Republic Act No. 3019, which was docketed
as Criminal Case No. SB-08-CRM-0265 entitled People v. Hernando Benito Perez, et. al., and was
raffled to the First Division of the Sandiganbayan. Perezes moved to quash the information, which
was denied. Sandiganbayan First Division granted the motions for reconsideration. The State moved
for the reconsideration of the resolution quashing the information. During the pendency of the States
motion for reconsideration, Criminal Case No. SB-08-CRM-0265 was re-raffled to the Third Division
of the Sandiganbayan. The Third Division denied the Ombudsmans motion for reconsideration.
Office of the Special Prosecutor (OSP) assailed in this Court via petition for certiorari the resolution
of the Sandiganbayan promulgated on July 17, 2008 quashing the information in Criminal Case No.
SB-08-CRM-0265 and the resolution promulgated on April 21, 2009 denying the States motion for
reconsideration

The information charging robbery under Article 293, in relation to Article 294, Revised Penal Code
was raffled to the Second Division (Criminal Case No. SB-08-CRM-0266). Escaler filed a motion to
quash ex abundanti ad cautelam, alleging that the facts charged did not constitute an offense. Perezes
filed their own motion to quash the information. Second Division of the Sandiganbayan denied the
respective motions to quash of respondents. Second Division of the Sandiganbayan granted the
motions for reconsideration, quashed the information charging respondents with robbery, and
dismissed Criminal Case No. SB-08-CRM0266.

ISSUE: Whether or not it was the Office of the Solicitor General, not the Office of the Ombudsman,
that had the authority to file the petitions to assail the Sandiganbayan resolutions
Whether the State, as the petitioner in G.R. No. 188165 and G.R. No. 189063, resorted to the wrong
remedy in assailing the resolutions of the Sandiganbayan dismissing the criminal charges against the
respondents through petitions for certiorari instead of petitions for review on certiorari.

RULING:
The Office of the Ombudsman is empowered to file an appeal or certiorari from the
Sandiganbayan to the Supreme Court.
That only the Solicitor General may represent the People on appeal or certiorari in the Supreme Court
and the Court of Appeals in all criminal proceedings is the general rule,79 but the rule admits the
exception concerning all cases elevated to the Sandiganbayan and from the Sandiganbayan to the
Supreme Court, the Office of the Ombudsman, through its special prosecutor, shall represent the
People of the Philippines, except in cases filed pursuant to Executive Order Nos. 1, 2, 14 and 14-A,
issued in 1986. More specifically, Section 4(c) of Republic Act No. 8249 authorizes the exception.

Petitioner did not establish grave abuse of discretion on the part of the Sandiganbayan
G.R. No. 188165: The Sandiganbayan correctly applied the restrictive meaning of the term
transaction as used in Section 3 (b) of Republic Act No. 3019 adopted in Soriano, Jr. v.
Sandiganbayan.
Jurisprudence did not overturn the interpretation made in Soriano, Jr. of the term transaction as used
in Section 3(b) of Republic Act No. 3019 because the proper interpretation of the term was clearly not
decisive in those cases. On the contrary, in the later ruling in Merencillo v. People, promulgated in
2007, the Court reiterated the restrictive interpretation given in Soriano, Jr. to the term transaction as
used in Section 3(b) of Republic Act No. 3019 in connection with a differentiation between bribery
under the Revised Penal Code and the violation of Section 3(b) of Republic Act No. 3019 by holding
that the latter is limited only to contracts or transactions involving monetary consideration where the
public officer has the authority to intervene under the law.

G.R. No. 189063: The Sandiganbayan did not commit any grave abuse of discretion in finding that
there had been an inordinate delay in the resolution against respondents of the charge in Criminal
Case No. SB-08-CRM-0266
The right to the speedy disposition of cases is enshrined in Article III of the Constitution. The
constitutional right to a speedy disposition of cases is not limited to the accused in criminal
proceedings but extends to all parties in all cases, including civil and administrative cases, and in all
proceedings, including judicial and quasi-judicial hearings. While the concept of speedy disposition is
relative or flexible, such that a mere mathematical reckoning of the time involved is not sufficient, the
right to the speedy disposition of a case, like the right to speedy trial, is deemed violated when the
proceedings are attended by vexatious, capricious, and oppressive delays; or when unjustified
postponements of the trial are asked for and secured; or when without cause or justifiable motive a
long period of time is allowed to elapse without the party having his case tried.
It is clear from the foregoing that the Office of the Ombudsman had taken an unusually long period of
time just to investigate the criminal complaint and to determine whether to criminally charge the
respondents in the Sandiganbayan. Such long delay was inordinate and oppressive, and constituted
under the peculiar circumstances of the case an outright violation of the respondents right under the
Constitution to the speedy disposition of their cases. If, in Tatad v. Sandiganbayan, the Court ruled
that a delay of almost three years in the conduct of the preliminary investigation constituted a
violation of the constitutional rights of the accused to due process and to the speedy disposition of his
case, taking into account the following, namely: (a) the complaint had been resurrected only after the
accused had a falling out with former President Marcos, indicating that political motivations had
played a vital role in activating and propelling the prosecutorial process; (b) the Tanodbayan had
blatantly departed from the established procedure prescribed by law for the conduct of preliminary
investigation; and (c) the simple factual and legal issues involved did not justify the delay, there is a
greater reason for us to hold so in the respondents case. To emphasize, it is incumbent for the State to
prove that the delay was reasonable, or that the delay was not attributable to it. In both regards, the
State miserably failed.
The guarantee of speedy disposition under Section 16 of Article III of the Constitution applies to all
cases pending before all judicial, quasijudicial or administrative bodies. The guarantee would be
defeated or rendered inutile if the hair-splitting distinction by the State is accepted. Whether or not the
fact-finding investigation was separate from the preliminary investigation conducted by the Office of
the Ombudsman should not matter for purposes of determining if the respondents right to the speedy
disposition of their cases had been violated.

Maria Carolina Araullo et al vs. Benigno Simeon Aquino III et al

G.R. No. 209287, February 3, 2015
BERSAMIN, J.:
The Constitution must ever remain supreme. All must bow to the mandate of this law. Expediency
must not be allowed to sap its strength nor greed for power debase its rectitude.
FACTS:
On September 25, 2013, in a privilege speech delivered by Sen. Jinggoy Ejercito Estrada delivered in
the Senate of the Philippines he divulged that some Senators, including himself, had been allotted an
additional P50 Million each as incentive for voting in favor of the impeachment of Chief Justice
Renato C. Corona. According to Secretary Jinggoy Estrada the DAP does not only realign funds
within the Executive. He said that some non-Executive projects were also funded; to name a few:
Php1.5B for the CPLA (Cordillera Peoples Liberation Army), Php1.8B for the MNLF (Moro
National Liberation Front), P700M for the Quezon Province, P50-P100M for certain Senators each,
P10B for Relocation Projects, etc. As an answer to Sen. Estrada's revelation, Secretary Florencio
Abad of the DBM issued a public statement entitled Abad: Releases to Senators Part of Spending
Acceleration Program explaining that the funds released to the Senators had been part of the
Disbursement Acceleration Program, a program designed by the Department of Budget and
Management to ramp up spending to accelerate economic expansion. DBM Secretary said that such
releases were made as their response to the letters of request for funding given by the Senators; and
that it was not the first time that releases from the DAP had been made. According to the DBM
Secretary, DAP had already been instituted in 2011 to ramp up spending after sluggish disbursements
had caused the growth of the gross domestic product (GDP) to slow down.
This revelation prompted Maria Carolina Araullo, Chairperson of the Bagong Alyansang Makabayan,
and several other concerned citizens to file various petitions with the Supreme Court questioning the
validity of the DAP. They contended that DAP is unconstitutional because it violates the
constitutional rule which provides that no money shall be paid out of the Treasury except in
pursuance of an appropriation made by law.DBM Secretary refuted her statement and argued that the
DAP is based on certain laws particularly the General Appropriations Act (GAA) (savings and
augmentation provisions thereof), Sec. 25(5), Art. VI of the Constitution (power of the President to
augment), Secs. 38 and 49 of Executive Order 292 (power of the President to suspend expenditures
and authority to use savings, respectively). DBM Secretary also explained that when he assumed
office in the middle of 2010, President Aquino made efficiency and transparency in government
spending a significant focus of his Administration. Such focus unfortunately decelerated government
project implementation and payment schedules even if it resulted in an improved fiscal deficit of 0.5%
in the gross domestic product (GDP) from January to July of 2011. Based on the observations of the
World Bank, the Philippines' economic growth could be reduced, and potential growth could be
weakened should the Government continue with its under spending and fail to address the large
deficiencies in infrastructure.
The DBM Secretary contended that the DAP was to be implemented and funded by declaring
savings coming from the various departments and agencies derived from pooling unobligated
allotments and withdrawing unreleased appropriations; (2) releasing unprogrammed funds; and (3)
applying the savings and unprogrammed funds to augment existing P APs or to support other priority
PAPs. The Government, by spending on public infrastructure, would signify its commitment of
ensuring profitability for prospective investors. The PAPs funded under the DAP were chosen for this
reason based on their: (1) multiplier impact on the economy and infrastructure development; (2)
beneficial effect on the poor; and (3) translation into disbursements.

ISSUE: Whether or not the DAP violates the principle no money shall be paid out of the Treasury
except in pursuance of an appropriation made by law (Sec. 29(1), Art. VI, Constitution). 2. Whether
or not the DAP realignments/transfers are constitutional. 3. Whether or not the Doctrine of Operative
Fact is applicable.

RULING:
There must be an existing item, project or activity, purpose or object of expenditure with an
appropriation to which savings may be transferred for the purpose of augmentation. Accordingly, so
long as there is an item in the GAA for which Congress had set aside a specified amount of public
fund, savings may be transferred thereto for augmentation purposes. This interpretation is consistent
not only with the Constitution and the GAAs, but also with the degree of flexibility allowed to the
Executive during budget execution in responding to unforeseeable contingencies. Nonetheless, this
modified interpretation does not take away the caveat that only DAP projects found in the appropriate
GAAs may be the subject of augmentation by legally accumulated savings. Whether or not the 116
DAP-funded projects had appropriation cover and were validly augmented require factual
determination that is not within the scope of the present consolidated petitions under Rule 65.
In the decision, the Court has held that the requirement under the relevant GAAs should be construed
in light of the purpose for which the unprogrammed funds were denominated as standby
appropriations. Hence, revenue targets should be considered as a whole, not individually; otherwise,
we would be dealing with artificial revenue surpluses. We have even cautioned that the release of
unprogrammed funds based on the respondents position could be unsound fiscal management for
disregarding the budget plan and fostering budget deficits, contrary to the Governments surplus
budget policy. There must be consistent monitoring as a component of the budget accountability phase
of every agencys performance in terms of the agencys budget utilization as provided in Book VI,
Chapter 6, Section 51 and Section 52 of the Administrative Code of 1987. Pursuant to the foregoing,
the Department of Budget and Management (DBM) and the Commission on Audit (COA) require
agencies under various joint circulars to submit budget and financial accountability reports (BFAR) on
a regular basis, one of which is the Quarterly Report of Income or Quarterly Report of Revenue and
Other Receipts. On the other hand, as Justice Carpio points out in his Separate Opinion, the
Development Budget Coordination Committee (DBCC) sets quarterly revenue targets for a specific
fiscal year. Since information on both actual revenue collections and targets are made available every
quarter, or at such time as the DBM may prescribe, actual revenue surplus may be determined
accordingly and releases from the unprogrammed fund may take place even prior to the end of the
fiscal year.
The authors, proponents and implementors of the DAP, being public officers, further enjoy the
presumption of regularity in the performance of their functions. This presumption is necessary
because they are clothed with some part of the sovereignty of the State, and because they act in the
interest of the public as required by law. However, the presumption may be disputed.
As a general rule, the nullification of an unconstitutional law or act carries with it the illegality of its
effects. However, in cases where nullification of the effects will result in inequity and injustice, the
operative fact doctrine may apply. In so ruling, the Court has essentially recognized the impact on the
beneficiaries and the country as a whole if its ruling would pave the way for the nullification of the
P144.378 Billions58 worth of infrastructure projects, social and economic services funded through the
DAP. Bearing in mind the disastrous impact of nullifying these projects by virtue alone of the
invalidation of certain acts and practices under the DAP, the Court has upheld the efficacy of such
DAP-funded projects by applying the operative fact doctrine. For this reason, we cannot sustain the
Motion for Partial Reconsideration of the petitioners in G.R. No. 209442.

Raul Sesbreno vs. Court of Appeals

G.R. No. 160689, March 26, 2014
BERSAMIN, J.:
If the search is made at the behest or initiative of the proprietor of a private establishment for its own
and private purposes, and without the intervention of police authorities, the right against
unreasonable search and seizure cannot be invoked for only the act of private individual, not the law
enforcers, is involved. In sum, the protection against unreasonable searches and seizures cannot be
extended to acts committed by private individuals so as to bring it within the ambit of alleged unlawful
intrusion by the government.
FACTS:
VECO was a public utility corporation engaged in the sale and distribution of electricity within
Metropolitan Cebu. Sesbreo was one of VECOs customers. VECO employed respondents Engr.
Constantino and Arcilla as violation of contract (VOC) inspectors. Respondent Sgt. Balicha, who
belonged to the 341st Constabulary Company accompanied and escorted the VOC inspectors during
their inspection of the households of its customers pursuant to a mission order issued to him.
On that day, the Violation of Contracts Team conducted a routine inspection of the houses for
illegal connections, meter tampering, seals, conduit pipes, jumpers, wiring connections, and meter
installations, including that of Sesbreo. After Sesbreos maid, unlocked the gate, they inspected the
electric meter and found that it had been turned upside down. With Chuchie Garcia, Peter Sesbreo
and one of the maids present, they removed said meter and replaced it with a new one. At that time,
plaintiffappellant Sesbreo was in his office and no one called to inform him of the inspection.
However, according to Sesbreo there was nothing routine or proper at all with what the VOC Team
did in his house. Their entry to his house and the surrounding premises was affected without his
permission and over the objections of his maids. They threatened, forced or coerced their way into his
house. Afterwards, he found that some of his personal effects were missing, apparently stolen by the
VOC Team when they searched the house. Hence, he filed a complaint for damages which was denied
by the RTC. Upon appeal, he CA affirmed the RTC.

ISSUE: Whether or not Sesbreo is entitled to recover damages for abuse of rights.

RULING: NO
Sesbreo insists, citing Section 2, Article III of the 1987 Constitution, the clause guaranteeing
the right of every individual against unreasonable searches and seizures. He states that a violation of
this constitutional guaranty rendered VECO and its VOS team liable to him for damages by virtue of
Article 32 (9) of the Civil Code.
The constitutional guaranty against unlawful searches and seizures is intended as a restraint
against the Government and its agents tasked with law enforcement. It is to be invoked only to ensure
freedom from arbitrary and unreasonable exercise of State power. In People vs. Marti, the court held
that if the search is made upon the request of law enforcers, a warrant must generally be first secured
if it is to pass the test of constitutionality. However, if the search is made at the behest or initiative of
the proprietor of a private establishment for its own and private purposes, and without the
intervention of police authorities, the right against unreasonable search and seizure cannot be
invoked for only the act of private individual, not the law enforcers, is involved. In sum, the
protection against unreasonable searches and seizures cannot be extended to acts committed by
private individuals so as to bring it within the ambit of alleged unlawful intrusion by the
government.
Balichas presence participation in the entry did not make the inspection a search by an agent
of the State within the ambit of the guaranty. As already mentioned, Balicha was part of the team by
virtue of his mission order authorizing him to assist and escort the team during its routine inspection.
Clearly, Sesbreo did not establish his claim for damages if the respondents were not guilty of
abuse of rights. To stress, the concept of abuse of rights prescribes that a person should not use his
right unjustly or in bad faith; otherwise, he may be liable to another who suffers injury. The law
recognizes the primordial limitation on all rights that in the exercise of the rights, the standards
under Article 19 must be observed. Although the act is not illegal, liability for damages may arise
should there be an abuse of rights, like when the act is performed without prudence or in bad faith.
There is no hard and fast rule that can be applied to ascertain whether or not the principle of abuse of
rights is to be invoked. The resolution of the issue depends on the circumstances of each case.
Sesbreo asserts that he did not authorize Baledio or Chuchie Garcia to let anyone enter his
residence in his absence; that the members of the VOC team had intimidated her into letting them in.
The assertion of Sesbreo is improper for consideration in this appeal. The RTC and the CA
unanimously found the testimonies of Sesbreos witnesses implausible because of inconsistencies on
material points. Considering that such findings related to the credibility of the witnesses and their
testimonies, the Court cannot review and undo them now because it is not a trier of facts, and is not
also tasked to analyze or weigh evidence all over again. Only when Sesbreo could make a clear
showing of abuse in their appreciation of the evidence and records by the trial and the appellate courts
should the Court do the unusual review of the factual findings of the trial and appellate courts. Alas,
that showing was not made here.

Dennis Funa vs. Acting Secretary of Justice Alberto Agra

G.R. No. 191644, February 19, 2013
BERSAMIN, J.:
Section 13, Article VII of the 1987 Constitution expressly prohibits the President, Vice-President, the
Members of the Cabinet, and their deputies or assistants from holding any other office or employment
during their tenure unless otherwise provided in the Constitution. Complementing the prohibition is
Section 7, paragraph (2), Article IX-B of the 1987 Constitution, which bans any appointive official
from holding any other office or employment in the Government or any subdivision, agency or
instrumentality thereof, including government-owned or controlled corporations or their subsidiaries,
unless otherwise allowed by law or the primary functions of his position.
FACTS:
President Gloria M. Macapagal-Arroyo appointed Agra as the Acting Secretary of Justice following
the resignation of Secretary Agnes VST Devanadera in order to vie for a congressional seat in Quezon
Province; that on March 5, 2010, President Arroyo designated Agra as the Acting Solicitor General in
a concurrent capacity; that on April 7, 2010, the petitioner, in his capacity as a taxpayer, a concerned
citizen and a lawyer, commenced this suit to challenge the constitutionality of Agras concurrent
appointments or designations, claiming it to be prohibited under Section 13, Article VII of the 1987
Constitution; that during the pendency of the suit, President Benigno S. Aquino III appointed Atty.
Jose Anselmo I. Cadiz as the Solicitor General; and that Cadiz assumed as the Solicitor General and
commenced his duties as such on August 5, 2010.

ISSUE: Did the designation of Agra as the Acting Secretary of Justice, concurrently with his position
of Acting Solicitor General, violate the constitutional prohibition against dual or multiple offices for
the Members of the Cabinet and their deputies and assistants?

RULING: Yes
The designation of Agra as Acting Secretary of Justice concurrently with his position of Acting
Solicitor General was unconstitutional and void for being in violation of the constitutional prohibition
under Section 13, Article VII of the 1987 Constitution.
At the center of the controversy is the correct application of Section 13, Article VII of the 1987
Constitution. A relevant and complementing provision is Section 7, paragraph (2), Article IX-B of the
1987 Constitution. Being designated as the Acting Secretary of Justice concurrently with his position
of Acting Solicitor General, therefore, Agra was undoubtedly covered by Section 13, Article VII,
supra, whose text and spirit were too clear to be differently read. Hence, Agra could not validly hold
any other office or employment during his tenure as the Acting Solicitor General, because the
Constitution has not otherwise so provided. It was of no moment that Agras designation was in an
acting or temporary capacity. The text of Section 13, supra, plainly indicates that the intent of the
Framers of the Constitution was to impose a stricter prohibition on the President and the Members of
his Cabinet in so far as holding other offices or employments in the Government or in government-
owned or government controlled-corporations was concerned. In this regard, to hold an office means
to possess or to occupy the office, or to be in possession and administration of the office, which
implies nothing less than the actual discharge of the functions and duties of the office. Indeed, in
the language of Section 13 itself, supra, the Constitution makes no reference to the nature of the
appointment or designation. The prohibition against dual or multiple offices being held by one
official must be construed as to apply to all appointments or designations, whether permanent or
temporary, for it is without question that the avowed objective of Section 13, supra, is to prevent the
concentration of powers in the Executive Department officials, specifically the President, the Vice-
President, the Members of the Cabinet and their deputies and assistants. To construe differently is to
open the veritable floodgates of circumvention of an important constitutional disqualification of
officials in the Executive Department and of limitations on the Presidents power of appointment in
the guise of temporary designations of Cabinet Members, undersecretaries and assistant secretaries as
officers-in-charge of government agencies, instrumentalities, or government-owned or controlled
corporations.
According to Public Interest Center, Inc. v. Elma, the only two exceptions against the holding of
multiple offices are: (1) those provided for under the Constitution, such as Section 3, Article VII,
authorizing the Vice President to become a member of the Cabinet; and (2) posts occupied by
Executive officials specified in Section 13, Article VII without additional compensation in ex officio
capacities as provided by law and as required by the primary functions of the officials offices. It is
equally remarkable, therefore, that Agras designation as the Acting Secretary of Justice was not in an
ex officio capacity, by which he would have been validly authorized to concurrently hold the two
positions due to the holding of one office being the consequence of holding the other. Being included
in the stricter prohibition embodied in Section 13, supra, Agra cannot liberally apply in his favor the
broad exceptions provided in Section 7, paragraph 2, Article IX-B of the Constitution (Unless
otherwise allowed by law or the primary functions of his position) to justify his designation as
Acting Secretary of Justice concurrently with his designation as Acting Solicitor General, or vice
versa.
Agras concurrent designations as Acting Secretary of Justice and Acting Solicitor General did not
come within the definition of an ex officio capacity. The magnitude of the scope of work of the
Solicitor General, if added to the equally demanding tasks of the Secretary of Justice, is obviously too
much for any one official to bear. Apart from the sure peril of political pressure, the concurrent
holding of the two positions, even if they are not entirely incompatible, may affect sound government
operations and the proper performance of duties. Assuming that Agra, as the Acting Solicitor General,
was not covered by the stricter prohibition under Section 13, supra, due to such position being merely
vested with a cabinet rank under Section 3, Republic Act No. 9417, he nonetheless remained covered
by the general prohibition under Section 7, supra. Hence, his concurrent designations were still subject
to the conditions under the latter constitutional provision.
The primary functions of the Office of the Solicitor General are not related or necessary to the primary
functions of the Department of Justice. Considering that the nature and duties of the two offices are
such as to render it improper, from considerations of public policy, for one person to retain both, an
incompatibility between the offices exists, further warranting the declaration of Agras designation as
the Acting Secretary of Justice, concurrently with his designation as the Acting Solicitor General, to
be void for being in violation of the express provisions of the Constitution.

Atty. Ma. Rosario Manalang-Demigillo vs. Trade and Investment Development Corporation of
the Philippines
G.R. No. 168613, March 5, 2013
BERSAMIN, J.:
A reorganization undertaken pursuant to a specific statutory authority by the Board of Directors of a
government-owned and government-controlled corporation is valid.
FACTS:
Philippine Export and Foreign Loan Guarantee was renamed Trade and Investment Development
Corporation of the Philippines (TIDCORP) pursuant to Republic Act No. 8494. Republic Act No.
8494 reorganized the structure of TIDCORP. The issuance of appointments in accordance with the
reorganization ensued. Petitioner Rosario Manalang-Demigillo (Demigillo) was appointed as Senior
Vice President (PG 15) with permanent status, and was assigned to the Legal and Corporate Services
Department (LCSD) of TIDCORP. In 2002, TIDCORP President Joel C. Valdes sought an opinion
from the Office of the Government Corporate Counsel (OGCC) relative to TIDCORPs authority to
undertake a reorganization under the law. On the basis of OGCC Opinion No. 221, the Board of
Directors passed Resolution No. 1365, Series of 2002, on October 22, 2002 to approve a so-called
Organizational Refinement/Restructuring Plan to implement a new organizational structure and
staffing pattern. Demigillo challenged before the Board of Directors the validity of Resolution No.
1365 and of her assignment to the RCMSS. She averred that she had been thereby illegally removed
from her position of Senior Vice President in the LCSD to which she had been previously assigned
during the reorganization of July 1998.

ISSUE: Whether or not the Board of Directors of TIDCORP was an alter ego of the President who
had the continuing authority to reorganize TIDCORP

RULING: No
The doctrine of qualified political agency, also known as the alter ego doctrine, was introduced in the
landmark case of Villena v. The Secretary of Interior. The doctrine of qualified political agency
essentially postulates that the heads of the various executive departments are the alter egos of the
President, and, thus, the actions taken by such heads in the performance of their official duties are
deemed the acts of the President unless the President himself should disapprove such acts. This
doctrine is in recognition of the fact that in our presidential form of government, all executive
organizations are adjuncts of a single Chief Executive; that the heads of the Executive Departments
are assistants and agents of the Chief Executive; and that the multiple executive functions of the
President as the Chief Executive are performed through the Executive Departments. The doctrine has
been adopted here out of practical necessity, considering that the President cannot be expected to
personally perform the multifarious functions of the executive office. But the doctrine of qualified
political agency could not be extended to the acts of the Board of Directors of TIDCORP despite some
of its members being themselves the appointees of the President to the Cabinet. Under Section 10 of
Presidential Decree No. 1080, as further amended by Section 6 of Republic Act No. 8494,24 the five
ex officio members were the Secretary of Finance, the Secretary of Trade and Industry, the Governor
of the Bangko Sentral ng Pilipinas, the Director-General of the National Economic and Development
Authority, and the Chairman of the Philippine Overseas Construction Board, while the four other
members of the Board were the three from the private sector (at least one of whom should come from
the export community), who were elected by the ex officio members of the Board for a term of not
more than two consecutive years, and the President of TIDCORP who was concurrently the Vice-
Chairman of the Board. Such Cabinet members sat on the Board of Directors of TIDCORP ex officio,
or by reason of their office or function, not because of their direct appointment to the Board by the
President. Evidently, it was the law, not the President, that sat them in the Board.
Under the circumstances, when the members of the Board of Directors effected the assailed 2002
reorganization, they were acting as the responsible members of the Board of Directors of TIDCORP
constituted pursuant to Presidential Decree No. 1080, as amended by Republic Act No. 8494, not as
the alter egos of the President. We cannot stretch the application of a doctrine that already delegates
an enormous amount of power. Also, it is settled that the delegation of power is not to be lightly
inferred.
We uphold the 2002 reorganization and declare it valid for being done in accordance with the
exclusive and final authority expressly granted under Republic Act No. 8494, further amending
Presidential Decree No. 1080, the law creating TIDCORP itself. We reiterate that we cannot disturb
but must respect the ruling of the CSC that deals with specific cases coming within its area of
technical knowledge and expertise, absent a clear showing of grave abuse of discretion on its part.

Mayor Emmanuel Maliksi vs. Commission on Elections

G.R. No. 203302, April 11, 2013
BERSAMIN, J.:
The picture images of the ballots, as scanned and recorded by the PCOS, are likewise official
ballots that faithfully capture in electronic form the votes cast by the voter, as defined by Section 2(3)
of R.A. No. 9369. As such, the printouts thereof are the functional equivalent of the paper ballots filled
out by the voters and, thus, may be used for purposes of revision of votes in an electoral protest.
FACTS:
During the 2010 Elections, the Municipal Board of Canvassers proclaimed Saquilayan the winner for
the position of Mayor of Imus, Cavite. Maliksi, the candidate who garnered the second highest
number of votes, brought an election protest in RTC alleging that there were irregularities in the
counting of votes in 209 clustered precincts. Subsequently, the RTC held a revision of the votes, and,
based on the results of the revision, declared Maliksi as the duly elected Mayor of Imus commanding
Saquilayan to cease and desist from performing the functions of said office. Saquilayan appealed to
the COMELEC. In the meanwhile, the RTC granted Maliksis motion for execution pending appeal,
and Maliksi was then installed as Mayor. In resolving the appeal, the COMELEC First Division,
without giving notice to the parties, decided to recount the ballots through the use of the printouts of
the ballot images from the CF cards. Thus, it issued an order dated March 28, 2012 requiring
Saquilayan to deposit the amount necessary to defray the expenses for the decryption and printing of
the ballot images. Later, it issued another order for Saquilayan to augment his cash deposit. The First
Division issued a resolution nullifying the RTCs decision and declaring Saquilayan as the duly
elected Mayor.

ISSUE: Whether or not petitioner was deprived of due process in using printout of ballot images
without notice

RULING: Yes
The picture images of the ballots are electronic documents that are regarded as the equivalents of the
original official ballots themselves. In Vinzons-Chato v. House of Representatives Electoral Tribunal,
the Court held that the picture images of the ballots, as scanned and recorded by the PCOS, are
likewise official ballots that faithfully capture in electronic form the votes cast by the voter, as
defined by Section 2(3) of R.A. No. 9369. As such, the printouts thereof are the functional equivalent
of the paper ballots filled out by the voters and, thus, may be used for purposes of revision of votes in
an electoral protest. That the two documentsthe official ballot and its picture image are
considered original documents simply means that both of them are given equal probative weight. In
short, when either is presented as evidence, one is not considered as weightier than the other.
But this juridical reality does not authorize the courts, the COMELEC, and the Electoral Tribunals to
quickly and unilaterally resort to the printouts of the picture images of the ballots in the proceedings
had before them without notice to the parties. Despite the equal probative weight accorded to the
official ballots and the printouts of their picture images, the rules for the revision of ballots adopted
for their respective proceedings still consider the official ballots to be the primary or best evidence of
the voters will. In that regard, the picture images of the ballots are to be used only when it is first
shown that the official ballots are lost or their integrity has been compromised. All the foregoing rules
on revision of ballots stipulate that the printing of the picture images of the ballots may be resorted to
only after the proper Revision/Recount Committee has first determined that the integrity of the ballots
and the ballot boxes was not preserved.
The foregoing rules further require that the decryption of the images stored in the CF cards and the
printing of the decrypted images take place during the revision or recount proceedings. There is a
good reason for thus fixing where and by whom the decryption and the printing should be conducted.
It is during the revision or recount conducted by the Revision/Recount Committee when the parties
are allowed to be represented, with their representatives witnessing the proceedings and timely raising
their objections in the course of the proceedings. Moreover, whenever the Revision/Recount
Committee makes any determination that the ballots have been tampered and have become unreliable,
the parties are immediately made aware of such determination.
When, as in the present case, it was not the Revision/Recount Committee or the RTC exercising
original jurisdiction over the protest that made the finding that the ballots had been tampered, but the
First Division in the exercise of its appellate jurisdiction, the parties should have been given a formal
notice thereof.
Maliksi was not immediately made aware of that crucial finding because the First Division did not
even issue any written resolution stating its reasons for ordering the printing of the picture images.
The parties were formally notified that the First Division had found that the ballots had been tampered
only when they received the resolution of August 15, 2012, whereby the First Division nullified the
decision of the RTC and declared Saquilayan as the duly elected Mayor. Even so, the resolution of the
First Division to that effect was unusually mute about the factual bases for the finding of ballot box
tampering, and did not also particularize how and why the First Division was concluding that the
integrity of the ballots had been compromised. All that the First Division declared as justification was
a simple generalization of the same being apparent from the allegations of ballot and ballot box
tampering and upon inspection of the ballot boxes.
The disregard of Maliksis right to be informed of the decision to print the picture images of the
ballots and to conduct the recount proceedings during the appellate stage cannot be brushed aside by
the invocation of the fact that Maliksi was able to file, after all, a motion for reconsideration. To be
exact, the motion for reconsideration was actually directed against the entire resolution of the First
Division, while Maliksis claim of due process violation is directed only against the First Divisions
recount proceedings that resulted in the prejudicial result rendered against him. Notably, the First
Division did not issue any order directing the recount. Without the written order, Maliksi was
deprived of the chance to seek any reconsideration or even to assail the irregularly-held recount
through a seasonable petition for certiorari in this Court. In that context, he had no real opportunity to
assail the conduct of the recount proceedings.
We should not ignore that the parties participation during the revision and recount proceedings would
not benefit only the parties, but was as vital and significant for the COMELEC as well, for only by
their participation would the COMELECs proceedings attain credibility as to the result. The parties
presence would have ensured that the requisite procedures have been followed, including the required
authentication and certification that the images to be printed are genuine. In this regard, the
COMELEC was less than candid, and was even cavalier in its conduct of the decryption and printing
of the picture images of the ballots and the recount proceedings.
Elsie Causing vs. Commission on Elections and Hernan Biron Sr.
G.R. No. 199139, September 09, 2014
BERSAMIN, J.:
The only personnel movements prohibited by COMELEC Resolution No. 8737 were transfer and
detail. Transfer is defined in the Resolution as any personnel movement from one government
agency to another or from one department, division, geographical unit or subdivision of a government
agency to another with or without the issuance of an appointment; while detail as defined in
the Administrative Code of 1987 is the movement of an employee from one agency to another without
the issuance of an appointment.
FACTS:
On January 1, 1993, Causing assumed office as the Municipal Civil Registrar of Barotac Nuevo,
Iloilo. On May 28, 2010, Mayor Biron issued Memorandum No. 12, Series of 2010, detailing her at
the Office of the Municipal Mayor effective upon receipt of the said order. On the same date, Mayor
Biron also issued Office Order No. 13 detailing Catalina V. Belonio, another municipal employee, to
the office of the Local Civil Registrar.
On June 1, 2010, Mayor Biron issued to Causing Memorandum No. 17, Series of 2010, and
Memorandum No. 17-A, Series of 2010, directing her to report to the Office of the Mayor effective
immediately upon receipt of said order.
In view of the foregoing issuances by Mayor Biron, Causing filed the complaint-affidavit in the Office
of the Regional Election Director, Region VI, in Iloilo City, claiming that Office Order No. 12 issued
by Mayor Biron ordering her detail to the Office of the Municipal Mayor, being made within the
election period and without prior authority from the COMELEC, was illegal and violative of Section
1, Paragraph A, No. 1, in connection with Section 6 (B) of COMELEC Resolution No. 8737, Series of
2009.
On March 1, 2011, Atty. Doronilla, the Provincial Election Supervisor recommended the dismissal of
the complaint-affidavit. On September 9, 2011, the COMELEC En Banc affirmed the findings and
recommendation of PES Doronilla. Hence, this petition for certiorari.

ISSUE:
Whether or not the relocation of the petitioner by respondent Municipal Mayor during the election
period from her office as the Local Civil Registrar to the Office of the Mayor constituted a prohibited
act under the Omnibus Election Code and the relevant Resolution of the Commission on Elections.

RULING: NO
Procedural Issue: Causing did not file a motion for reconsideration before filing the petition
for certiorari

Mayor Biron indicates that Causing did not file a motion for reconsideration before coming to
the Court. Causing submits, however, that she was not required to file the motion for reconsideration
because the only recourse of an aggrieved party from the decision of the COMELEC was the filing of
the petition for certiorari under either Rule 64 or Rule 65. The well-established rule is that the motion
for reconsideration is an indispensable condition before an aggrieved party can resort to the special
civil action for certiorari under Rule 65 of the Rules of Court. The filing of the motion for
reconsideration before the resort to certiorari will lie is intended to afford to the public respondent the
opportunity to correct any actual or fancied error attributed to it by way of re-examination of the legal
and factual aspects of the case. The rule is not absolute, however, considering that jurisprudence has
laid down exceptions to the requirement for the filing of a petition for certiorari without first filing a
motion for reconsideration. A perusal of the circumstances of the case shows that none of the
foregoing exceptions was applicable herein. Hence, Causing should have filed the motion for
reconsideration, especially because there was nothing in the COMELEC Rules of Procedure that
precluded the filing of the motion for reconsideration in election offense cases. Accordingly, the
petition must be dismissed.

Substantive Issues: Mayor Birons acts did not violate the Omnibus Election Code
and the COMELEC Resolution

E.O. Case No. 10-131 was founded on Mayor Birons alleged violation of COMELEC Resolution No.
8737, Series of 2009, in relation to Section 261(g), (h) and (x) of the Omnibus Election Code. The
only personnel movements prohibited by COMELEC Resolution No. 8737 were transfer and
detail. Transfer is defined in the Resolution as any personnel movement from one government
agency to another or from one department, division, geographical unit or subdivision of a government
agency to another with or without the issuance of an appointment; while detail as defined in
the Administrative Code of 1987 is the movement of an employee from one agency to another without
the issuance of an appointment. Obviously, the movement involving Causing did not equate to either
a transfer or a detail within the contemplation of the law if Mayor Biron only thereby physically
transferred her office area from its old location to the Office of the Mayor some little steps away.
We cannot accept the petitioners argument, therefore, that the phrase any transfer or detail
whatsoever encompassed any and all kinds and manner of personnel movement, including the mere
change in office location.
Moreover, Causings too-literal understanding of transfer should not hold sway because the
provisions involved here were criminal in nature. Mayor Biron was sought to be charged with an
election offense punishable under Section 264 of the Omnibus Election Code. It is a basic rule of
statutory construction that penal statutes are to be liberally construed in favor of the accused. Every
reasonable doubt must then be resolved in favor of the accused. In short, no act can be pronounced
criminal unless it is clearly made so by statute prior to its commission (nullum crimen, nulla poena,
sine lege).
Equally material is that Mayor Birons act of transferring the office space of Causing was rooted in his
power of supervision and control over the officials and employees serving in his local government
unit, in order to ensure the faithful discharge of their duties and functions. Verily, she thereafter
continued to perform her tasks, and uninterruptedly received her salaries as the Municipal Civil
Registrar even after the transfer to the Office of the Mayor.
The issuance of Office Order No. 13 by Mayor Biron detailing Belonio to the Office of the Local
Civil Registrar was not proof of Mayor Birons crystal clear intention to replace and transfer her
during the election period. As the COMELEC En Banc found, Belonio did not receive the order, and
Causing remained as the Municipal Civil Registrar, leaving the detailing of Belonio uncompleted.
Without the actual appointment of Belonio as the Municipal Civil Registrar, it would be unwarranted
to criminally charge Mayor Biron of violating Section 261 of the Omnibus Election Code.
It is interesting to note that aside from the present election offense case, Causing initiated an
administrative case in the Civil Service Commission to challenge her reassignment pursuant to the
same office orders. In that administrative case, she referred to the personnel movement not as
a transfer or detail, but as a reassignment that constituted her constructive dismissal. On August 13,
2010, the CSC Regional Office No. 6 in Mandurriao, Iloilo City ruled that although Mayor Biron used
the word detail in referring to the personnel movement effected, the personnel action that actually
took place, albeit a reassignment, was a valid reassignment. Considering that reassignment was not
prohibited by the Omnibus Election Code, there was no probable cause to criminally charge Mayor
Biron with the violation of the Omnibus Election Code.

Arsenio Agustin vs. Commission on Elections and Salvador Pillos

G.R. No. 207105, November 10, 2015
BERSAMIN, J.:
A person of dual citizenship is disqualified from running for a public office in the Philippines.
FACTS:
Petitioner was naturalized as a citizen of the United States of America (USA). On October 5, 2012, he
filed his certificate of candidacy (CoC) for the position of Mayor of the Municipality of Marcos,
Ilocos Norte to be contested in the May 13, 2013 local elections. As the official candidate of the
Nacionalista Party, he declared in his CoC that he was eligible for the office he was seeking to be
elected to; that he was a natural born Filipino citizen; and that he had been a resident of the
Municipality of Marcos, Ilocos Norte for 25 years. Respondent Salvador S. Pillos, a rival mayoralty
candidate, filed in the COMELEC a Petition To Deny Due Course and/or to Cancel the Certificate of
Candidacy of Arsenio A. Agustin alleging that the petitioner had made a material misrepresentation in
his CoC by stating that he had been a resident of the Municipality of Marcos for 25 years despite
having registered as a voter therein only on May 31, 2012.

ISSUE: Whether or not petitioner is eligible as a candidate for the position of Mayor of the
Municipality of Marcos, Ilocos Norte

RULING:
We note that the petitioners citizenship came to the fore because he himself asserted his Philippine
citizenship in his answer to Pillos petition to cancel his CoC in order to bolster his allegation of
compliance with the oneyear residency requirement. As such, he could not credibly complain about
being denied due process, especially considering that he had been able to file an opposition to Pillos
motion for reconsideration. It is worthy to state that the observance of due process in administrative
proceedings does not always require or involve a trialtype proceeding, for the demand of due process
is also met whenever a person, being notified, is afforded the opportunity to explain or defend himself.
Also, due process is satisfied by giving the opportunity to seek the reconsideration of the action or
ruling complained of. The rule is the same in election cases.

A valid CoC arises upon the timely filing of a persons declaration of his intention to run for public
office and his affirmation that he possesses the eligibility for the position he seeks to assume. The
valid CoC renders the person making the declaration a valid or official candidate. There are two
remedies available under existing laws to prevent a candidate from running in an electoral race. One is
by petition for disqualification, and the other by petition to deny due course to or to cancel his
certificate of candidacy.

The denial of due course to or the cancellation of the CoC under Section 78 of the Omnibus Election
Code involves a finding not only that a person lacked a qualification for the office he is vying for but
also that such he made a material representation in the CoC that was false. The Court has stressed in
Mitra v. Commission on Elections, 622 SCRA 744 (2010), that in addition to materiality there must be
a deliberate attempt to mislead, misinform, or hide a fact that would otherwise render the candidate
ineligible.
The petitioner took his Oath of Allegiance on March 9, 2012 and executed his Affidavit of
Renunciation on October 2, 2012. By his Oath of Allegiance and his renunciation of his USA
citizenship, he reverted to the status of an exclusively Filipino citizen. On October 5, 2012, the date he
filed his CoC he was, therefore, exclusively a Filipino citizen, rendering him eligible to run for public
office. His CoC was valid for all intents and purposes of the election laws because he did not make
therein any material misrepresentation of his eligibility to run as Mayor of the Municipality of
Marcos, Ilocos Norte.

We uphold the declaration by the COMELEC En Banc that the petitioner was ineligible to run and be
voted for as Mayor of the Municipality of Marcos, Ilocos Norte. It is not disputed that on October 6,
2012, after having renounced his USA citizenship and having already filed his CoC, he travelled
abroad using his USA passport, thereby representing himself as a citizen of the USA. He continued
using his USA passport in his subsequent travels abroad despite having been already issued his
Philippine passport on August 23, 2012. He thereby effectively repudiated his oath of renunciation on
October 6, 2012, the first time he used his USA passport after renouncing his USA citizenship on
October 2, 2012. Consequently, he could be considered an exclusively Filipino citizen only for the
four days from October 2, 2012 until October 6, 2012. The petitioners continued exercise of his rights
as a citizen of the USA through using his USA passport after the renunciation of his USA citizenship
reverted him to his earlier status as a dual citizen. Such reversion disqualified him from being elected
to public office in the Philippines pursuant to Section 40(d) of the Local Government Code.

Valentino Legaspi vs. City of Cebu, T.C. Sayson

G.R. No. 159110, December 10, 2013
BERSAMIN, J.:
The goal of the decentralization of powers to the local government units (LGUs) is to ensure the
enjoyment by each of the territorial and political subdivisions of the State of a genuine and
meaningful local autonomy. To attain the goal, the National Legislature has devolved the three great
inherent powers of the State to the LGUs. Each political subdivision is thereby vested with such
powers subject to constitutional and statutory limitations.
FACTS:
On January 27, 1997 the Sangguniang Panlungsod of the City of Cebu enacted Ordinance No. 1664 to
authorize the traffic enforcers of Cebu City to immobilize any motor vehicle violating the parking
restrictions and prohibitions defined in Ordinance No. 801 (Traffic Code of Cebu City). On July 29,
1997, Atty. Bienvenido Jaban (Jaban, Sr.) and his son Atty. Bienvenido Douglas Luke Bradbury Jaban
(Jaban, Jr.) brought suit in the RTC in Cebu City against the City of Cebu, then represented by Hon.
Alvin Garcia, its City Mayor, the Sangguniang Panlungsod of Cebu City and its Presiding Officer,
Hon. Renato V. Osmea, and the chairman and operatives or officers of the City Traffic Operations
Management (CITOM), seeking the declaration of Ordinance No. 1644 as unconstitutional for being
in violation of due process and for being contrary to law, and damages.

ISSUE: Whether Ordinance No. 1664 was enacted within the ambit of the legislative powers of the
City of Cebu

RULING: Yes
Tests for a valid ordinance
In City of Manila v. Laguio, Jr., the Court restates the tests of a valid ordinance thusly: The tests of a
valid ordinance are well established. A long line of decisions has held that for an ordinance to be
valid, it must not only be within the corporate powers of the local government unit to enact and must
be passed according to the procedure prescribed by law, it must also conform to the following
substantive requirements: (1) must not contravene the Constitution or any statute; (2) must not be
unfair or oppressive; (3) must not be partial or discriminatory; (4) must not prohibit but may regulate
trade; (5) must be general and consistent with public policy; and (6) must not be unreasonable. As
jurisprudence indicates, the tests are divided into the formal (i.e., whether the ordinance was enacted
within the corporate powers of the LGU, and whether it was passed in accordance with the procedure
prescribed by law), and the substantive (i.e., involving inherent merit, like the conformity of the
ordinance with the limitations under the Constitution and the statutes, as well as with the requirements
of fairness and reason, and its consistency with public policy).

Compliance of Ordinance No. 1664 with the formal requirements

Indeed, with no issues being hereby raised against the formalities attendant to the enactment of
Ordinance No. 1664, we presume its full compliance with the test in that regard. Congress enacted the
LGC as the implementing law for the delegation to the various LGUs of the States great powers,
namely: the police power, the power of eminent domain, and the power of taxation. The LGC was
fashioned to delineate the specific parameters and limitations to be complied with by each LGU in the
exercise of these delegated powers with the view of making each LGU a fully functioning subdivision
of the State subject to the constitutional and statutory limitations. In particular, police power is
regarded as the most essential, insistent and the least limitable of powers, extending as it does to all
the great public needs. It is unquestionably the power vested in the legislature by the constitution,
to make, ordain and establish all manner of wholesome and reasonable laws, statutes and ordinances,
either with penalties or without, not repugnant to the constitution, as they shall judge to be for the
good and welfare of the commonwealth, and of the subject of the same.
In point is the exercise by the LGU of the City of Cebu of delegated police power. The foregoing
delegation reflected the desire of Congress to leave to the cities themselves the task of confronting the
problem of traffic congestions associated with development and progress because they were directly
familiar with the situations in their respective jurisdictions. Indeed, the LGUs would be in the best
position to craft their traffic codes because of their familiarity with the conditions peculiar to their
communities. With the broad latitude in this regard allowed to the LGUs of the cities, their traffic
regulations must be held valid and effective unless they infringed the constitutional limitations and
statutory safeguards.

Compliance of Ordinance No. 1664 with the substantive requirements

The first substantive requirement for a valid ordinance is the adherence to the constitutional guaranty
of due process of law. The guaranty is embedded in Article III, Section 1 of the Constitution. Even
under strict scrutiny review, Ordinance No. 1664 met the substantive tests of validity and
constitutionality by its conformity with the limitations under the Constitution and the statutes, as well
as with the requirements of fairness and reason, and its consistency with public policy. To us, the
terms encroachment and obstacles used in Section 458 of the LGC, supra, were broad enough to
include illegally parked vehicles or whatever else obstructed the streets, alleys and sidewalks, which
were precisely the subject of Ordinance No. 1664 in avowedly aiming to ensure a smooth flow of
vehicular traffic in all the streets in the City of Cebu at all times (Section 1).
Firstly, Ordinance No. 1664 was far from oppressive and arbitrary. Any driver or vehicle owner
whose vehicle was immobilized by clamping could protest such action of a traffic enforcer or PNP
personnel enforcing the ordinance. Section 3 of Ordinance No. 1664, supra, textually afforded an
administrative escape in the form of permitting the release of the immobilized vehicle upon a protest
directly made to the Chairman of CITOM; or to the Chairman of the Committee on Police, Fire and
Penology of the City of Cebu; or to Asst. City Prosecutor Felipe Belcia officials named in the
ordinance itself. The release could be ordered by any of such officials even without the payment of the
stipulated fine. That none of the petitioners, albeit lawyers all, resorted to such recourse did not
diminish the fairness and reasonableness of the escape clause written in the ordinance. Secondly, the
immobilization of a vehicle by clamping pursuant to the ordinance was not necessary if the driver or
vehicle owner was around at the time of the apprehension for illegal parking or obstruction. In that
situation, the enforcer would simply either require the driver to move the vehicle or issue a traffic
citation should the latter persist in his violation. The clamping would happen only to prevent the
transgressor from using the vehicle itself to escape the due sanctions. And, lastly, the towing away of
the immobilized vehicle was not equivalent to a summary impounding, but designed to prevent the
immobilized vehicle from obstructing traffic in the vicinity of the apprehension and thereby ensure the
smooth flow of traffic. The owner of the towed vehicle would not be deprived of his property.

Office of the Ombudsman vs. Samson de Leon

G.R. No. 154083, February 27, 2013
BERSAMIN, J.:
A public official is guilty of grave misconduct when he neglects to act upon a complaint about a
violation of the law he is enforcing. He may be suspended or dismissed from office for his first offense.
FACTS:
Acting on a report of illegal quarrying being committed in the Municipality of Baras, Rizal, Graft
Investigation Officer Dante D. Tomilla of the Fact Finding Investigation Bureau (FFIB) of the Office
of the Ombudsman conducted an investigation pursuant to a mission order. Tornilla filed his report to
Ombudsman Aniano Desierto, through Assistant Ombudsman Abelardo L. Aportadera, Jr. and
Director Agapito B. Rosales, confirming the illegal quarrying. Tornilla recommended that a
preliminary investigation be conducted against Baras Municipal Mayor Roberto Ferrera, Baras
Municipal Planning and Coordinator Jonathan Llagas, and property owner Venancio Javier for the
probable violation of Section 3(e) of Republic Act No. 3019 (Anti-Graft and Corrupt Practices Act);
and that administrative proceedings for violations of the Civil Service Rules be also undertaken. DILG
Resident Ombudsman Rudiger G. Falcis II sought the inclusion in the investigation of De Leon as the
Provincial Environment and Natural Resources Officer (PENRO) and as concurrently the Chairman of
the Provincial Mining Regulatory Board (PMRB) of Rizal. After the preliminary investigation, Graft
Investigation Officer II Edgardo V. Geraldez of the FFIB, Office of the Ombudsman, issued a
decision dismissing the complaint against all the respondents for lack of substantial evidence. The
case was then referred to Atty. Sabino M. Cruz, Resident Ombudsman for the Department of
Environment and Natural Resources (DENR), who ultimately submitted a memorandum, duly
approved by the Ombudsman, finding De Leon liable for gross neglect of duty. CA promulgated its
assailed decision and held that petitioner SAMSON DE LEON is penalized with 3 months suspendion
without pay for SIMPLE NEGLECT OF DUTY.

ISSUE: Whether or not the CA committed reversible error in modifying the findings and reducing the
penalty imposed by the Office of the Ombudsman.

RULING: Yes
An examination of the records persuasively shows that the Office of the Ombudsman correctly held
De Leon guilty of gross neglect of duty, a grave offense punishable by dismissal even for the first
offense. A PENRO, who is appointed by the Secretary of the DENR, has the responsibility to
implement DENR policies, programs and projects in the province of his assignment. De Leon was
appointed as the PENRO of Rizal and concurrently the Chairman of the PMRB of Rizal. Based on the
Civil Service Position Description Form, De Leon as the PENRO of Rizal was the highest executive
officer of the DENR at the provincial level. He had the authority to coordinate all the DENR agencies
within his jurisdiction, including the PMRB. In his concurrent positions as the PENRO and Chairman
of the PMRB, therefore, his paramount function was to ensure that the laws enforced by the DENR as
well as the rules and regulations promulgated by the DENR in implementation of such laws were
complied with and effectively implemented and enforced. Verily, he was the primary implementor
and enforcer within his area of responsibility of all the laws and administrative orders concerning the
environment, and because of such character of his concurrent offices should have made sure that he
efficiently and effectively discharged his functions and responsibilities.
In the matter that is now before us, De Leon evidently neglected to efficiently and effectively
discharge his functions and responsibilities. Except for issuing the investigation order and for denying
having granted any permit to quarry, he did nothing affirmative to put a stop to the illegal quarrying
complained of, or to do any other action that was entirely within his power to do as the PENRO that
the complaint demanded to be done.
Gross neglect of duty or gross negligence refers to negligence characterized by the want of even
slight care, or by acting or omitting to act in a situation where there is a duty to act, not inadvertently
but wilfully and intentionally, with a conscious indifference to the consequences, insofar as other
persons may be affected. It is the omission of that care that even inattentive and thoughtless men
never fail to give to their own property. It denotes a flagrant and culpable refusal or unwillingness of
a person to perform a duty. In cases involving public officials, gross negligence occurs when a breach
of duty is flagrant and palpable. In contrast, simple neglect of duty means the failure of an employee
or official to give proper attention to a task expected of him or her, signifying a disregard of a duty
resulting from carelessness or indifference.
Conformably with these concepts, De Leon, given his rank and level of responsibility, was guilty of
gross neglect in not performing the act expected of him as the PENRO under the circumstances
obtaining. He was precisely assigned to perform tasks that imposed on him the obligation to do
everything reasonably necessarily and permissible under the law in order to achieve the objectives of
environmental protection.
Whether or not the decision of the Office of the Ombudsman was immediately executory, we hereby
hold that the decision is immediately executory, and that an appeal does not stop the decision from
being executory.

Brenda Nazareth, Regional Director, Department of Science and Technology , Regional Office
No. IX vs. Hon. Reynaldo Villar, Hon. Juanito Espino Jr. (CHR Commissioners) and Dir. Khem
Inok
G .R. No. 188635, January 29, 2013
BERSAMIN, J.:
No money shall be paid out of the Treasury except in pursuance of an appropriation made by law. A
violation of this constitutional edict warrants the disallowance of the payment. However, the refund of
the disallowed payment of a benefit granted by law to a covered person, agency or office of the
Government may be barred by the good faith of the approving official and of the recipient.
FACTS:
Congress enacted R.A. No. 8439 to address the policy of the State to provide a program for human
resources development in science and technology in order to achieve and maintain the necessary
reservoir of talent and manpower that would sustain the drive for total science and technology
mastery. Section 7 of R.A. No. 8439 grants the following additional allowances and benefits (Magna
Carta benefits) to the covered officials and employees of the DOST. Under R.A. No. 8439, the funds
for the payment of the Magna Carta benefits are to be appropriated by the General Appropriations Act
(GAA) of the year following the enactment of R.A. No. 8439. The DOST Regional Office No. IX in
Zamboanga City released the Magna Carta benefits to the covered officials and employees
commencing in CY 1998 despite the absence of specific appropriation for the purpose in the GAA.
Subsequently, following the post-audit conducted by COA State Auditor Ramon E. Vargas, several
NDs were issued disapproving the payment of the Magna Carta benefits. The disallowance by the
COA prompted then DOST Secretary Dr. Filemon Uriarte, Jr. to request the Office of the President
(OP) through his Memorandum for the authority to utilize the DOSTs savings to pay the Magna
Carta benefits. Executive Secretary Ronaldo Zamora, acting by authority of the President, approved
the request of Secretary Uriarte, Jr. Petitioner, in her capacity as the DOST Regional Director in
Region IX, lodged an appeal with COA Regional Cluster Director Ellen Sescon, urging the lifting of
the disallowance of the Magna Carta benefits.

ISSUE: Did the COA commit grave abuse of discretion in issuing their report?

RULING: No
The authority granted to the President was subject to two essential requisites in order that a transfer of
appropriation from the agencys savings would be validly effected. The first required that there must
be savings from the authorized appropriation of the agency. The second demanded that there must be
an existing item, project, activity, purpose or object of expenditure with an appropriation to which the
savings would be transferred for augmentation purposes only.
Clearly and indubitably, the prohibition against the transfer of appropriations is the general rule.
Consequently, the payment of the Magna Carta benefits for CY 2001 without a specific item or
provision in the GAA and without due authority from the President to utilize the DOSTs savings in
other items for the purpose was repugnant to R.A. No. 8439, the Constitution, and the re-enacted
GAA for 2001.
The COA is endowed with sufficient latitude to determine, prevent, and disallow the irregular,
unnecessary, excessive, extravagant, or unconscionable expenditures of government funds. It has the
power to ascertain whether public funds were utilized for the purposes for which they had been
intended by law. The Court has accorded not only respect but also finality to their findings especially
when their decisions are not tainted with unfairness or arbitrariness that would amount to grave abuse
of discretion.

Only when the COA has acted without or in excess of jurisdiction, or with grave abuse of discretion
amounting to lack or excess of jurisdiction, may the Court entertain and grant a petition for certiorari
brought to assail its actions. Section 1 of Rule 65, Rules of Court, demands that the petitioner must
show that, one, the tribunal, board or officer exercising judicial or quasi-judicial functions acted
without or in excess of jurisdiction or with grave abuse of discretion amounting to lack or excess of
jurisdiction, and, two, there is neither an appeal nor any plain, speedy and adequate remedy in the
ordinary course of law for the purpose of amending or nullifying the proceeding. Inasmuch as the sole
office of the writ of certiorari is the correction of errors of jurisdiction, which includes the commission
of grave abuse of discretion amounting to lack of jurisdiction, the petitioner should establish that the
COA gravely abused its discretion.
Nonetheless, the Court opines that the DOST officials who caused the payment of the Magna Carta
benefits to the covered officials and employees acted in good faith in the honest belief that there was a
firm legal basis for the payment of the benefits. Evincing their good faith even after receiving the NDs
from the COA was their taking the initiative of earnestly requesting the OP for the authorization to use
the DOSTs savings to pay the Magna Carta benefits. On their part, the DOST covered officials and
employees received the benefits because they considered themselves rightfully deserving of the
benefits under the long-awaited law. The Court declares and holds that the disallowed benefits
received in good faith need not be reimbursed to the Government.

Marichu Ejera vs. Beau Merto and Erwin Vergara

G.R. No. 163109, January 22, 2014
BERSAMIN, J.:
The doctrine of exhaustion of administrative remedies is a cornerstone of our judicial system. It is true
that the doctrine of exhaustion of administrative remedies is not an ironclad rule, but recognizes
exceptions; however, the exceptions did not cover the petitioners case. The rule is that judicial
intervention should only be availed of after all administrative remedies had been exhausted.
FACTS:
The petitioner held the position of Agricultural Center Chief I in the Office of the Provincial
Agriculturist in Negros Oriental. Upon the retirement of the Supervising Agriculturist, she applied for
that position, but one Daisy Kirit was eventually appointed. She filed a protest against the
appointment of Kirit before the Civil Service Commission Regional Office in in Cebu City but that
said office dismissed her protest. Meanwhile, respondent Provincial Agriculturist Beau Henry L.
Merto issued Office Order No. 008 (Amending Office Order No. 008, Series of 2000, Re:
Assignment/Re-assignment of BADC Area Coordinators and Development Team Members).
The petitioner was one of the personnel re-assigned under Office Order No. 008. When she
refused to obey the office order, Merto ordered her to explain in writing within 72 hours why no
administrative disciplinary action should be taken against her. After she did not submit her
explanation, Merto summoned her to a conference. She and her counsel, Atty. Lenin R. Victoriano,
attended the conference, but later on walked out allegedly because Vergara refused to record her
objections to the questions she was being asked to answer.

The petitioner filed in the RTC her complaint for final injunction with temporary restraining
order and/or preliminary injunction, and damages, averring that Merto had issued Office Order No.
008 because he had so bitterly resented her attacks against him before the CSC Regional Office. The
petitioner moved for the admission of a supplemental complaint in order to implead Gregorio P.
Paltinca, the Officer-in-Charge of the Office of the Provincial Agriculturist, for issuing on June 29,
2001 Office Order No. 005, Series of 2001, to amend Office Order No. 008. The latter moved to
dismiss the supplemental complaint. The RTC dismissed the case, holding on the legality of Office
Order No. 008 and Office Order No. 005.

ISSUES:

Whether or not Office Order No. 008 and Office Order No. 005 were illegal for violating the rule
against indiscriminate and whimsical reassignment enunciated in the Administrative Code of 1987

Whether or not petitioners non-exhaustion of her available administrative remedies was fatal to her
cause.
Whether or not Paltincas motion to dismiss could be resolved before the admission of the
supplemental complaint.

RULING:

Firstly, Section 26, Chapter 5, Title I-A, Book V of the Administrative Code of 1987 lists the
personnel actions that may be taken in the government service, namely: (1) appointment through
certification; (2) promotion; (3) transfer; (4) reinstatement; (5) reemployment; (6) detail; and (7)
reassignment. The subject of the assailed office orders was a reassignment, which is not to be
confused with a transfer. The office orders themselves indicated that the personnel action involved
was a reassignment, not a transfer, for, indeed, the petitioner was being moved from the organizational
unit of the Office of the Provincial Agriculturist in Dumaguete City to that in the barangays of the
Municipality of Siaton.
That the reassignment was made without the petitioners consent can be deduced from her refusal
to report to the station of her new assignment. She lost the opportunity to ventilate her reason for
refusing the reassignment by walking out of the conference instead of explaining her refusal to follow
Office Order No. 008.
Secondly, under the Administrative Code of 1987, the CSC has the power and function to [p]rescribe,
amend and enforce rules and regulations for carrying into effect the provisions of the Civil Service
Law and other pertinent laws.

A public servant who has an issue against a directive for her re-assignment must exhaust her
available administrative remedies before resorting to judicial action. The non-exhaustion of
available administrative remedies is fatal to the resort to judicial action.
The reassignment of the petitioner was a personnel and Civil Service matter to be properly
addressed in accordance with the rules and guidelines prescribed by the CSC. Her resort to judicial
intervention could not take the place of the grievance procedure then available to her.
The doctrine of exhaustion of administrative remedies is a cornerstone of our judicial system. It is
true that the doctrine of exhaustion of administrative remedies is not an ironclad rule, but recognizes
exceptions; however, the exceptions did not cover the petitioners case. The rule is that judicial
intervention should only be availed of after all administrative remedies had been exhausted. The
Judiciary must not intervene because Office Order No. 008 and Office Order No. 005 both concerned
the implementation of a provincial executive policy. The doctrine of exhaustion of administrative
remedies is a judicial recognition of certain matters that are peculiarly within the competence of the
administrative agency to address. It operates as a shield that prevents the overarching use of judicial
power and thus hinders courts from intervening in matters of policy infused with administrative
character. The Court has always adhered to this precept, and it has no reason to depart from it now.
Verily, had the petitioner followed the grievance procedure under the CSCs Omnibus Rules, her next
step would have been to elevate her case to the CSC itself, the constitutional body charged with the
exclusive jurisdiction not only over disciplinary actions against government officials and employees
but also over cases involving personnel actions.

The petitioner filed her supplemental complaint to assail Office Order No. 005, and thereby raised
issues identical to those raised in her original complaint involving Office Order No. 008. Hence, the
RTC could already resolve Paltincas motion to dismiss even without first admitting the supplemental
complaint. Unlike an amended complaint, her supplemental complaint could exist side-by-side with
the original complaint, because the supplemental complaint averred facts supervening from the filing
of the complaint pursuant to Rule 10 of the 1997 Rules of Civil Procedure.

Alleged Loss of Various Boxes of Copy Paper During their Transfer from the Property Division,
Office of Administrative Services (OAS), to the Various Rooms of the Philippine Judicial
Academy
A.M. No. 2008-23-SC, September 30, 2014
BERSAMIN, J.:
There is grave misconduct when the elements of corruption, clear intent to violate the law, or flagrant
disregard of established rule are present. Dishonesty is defined as a disposition to lie, cheat, deceive
or defraud; untrustworthiness; lack of integrity; lack of honesty, probity or integrity in principle; lack
of fairness and straightforwardness. Both gross misconduct and dishonesty are grave offenses that are
punishable by dismissal even for the first offense. Conduct prejudicial to the best interest of the
service is also classified as a grave offense under Section 22(t) of the Omnibus Rules Implementing
Book V of Executive Order No. 292 and other pertinent Civil Service laws.
FACTS:
On October 23, 2008, Bocs Trading Co., Inc. delivered 1,300 reams of short copy paper and
1,100 reams of long copy paper to the Supreme Court intended for the Philippine Judicial Academy.
As instructed by Administrative Officer Recio, the delivery was initially accepted by Orcullo, the
Property Custodian of the PHILJA, because Supply Officer Isidro Austria and Store Keeper IV
Ordoez, both of the Property and Supply Section were then not around. When Orcullo left for his
lunch break, Ordoez took over. The rest of the deliveries were unloaded from the delivery truck at
the Centennial Building of the Court upon the instruction of Ordoez.
With the help of Judicial Staff Employee II Carmona, Ordoez then initiated the transfer of the
copy paper to the stockroom and the Reproduction Room of the Office of the Court Administrator in
the Supreme Court Multipurpose Building located in the SC New Building. In the afternoon of
October 23, 2008, Orcullo informed Administrative Officer Recio that 400 reams of short copy paper
and 40 reams of long copy paper were missing. Atty. Rodel O. Hernandez formally reported the
missing boxes of copy paper belonging to the PHILJA to PHILJA Vice Chancellor Justice Justo P.
Torres, Jr. The Office of Administrative Services (OAS) directed Austria, Ordoez, Glor and
Carmona to submit their respective comments, and to show cause why they should not be held
administratively liable for grave misconduct, and/or conduct prejudicial to the best interest of the
service.
In his comment, Ordoez reiterated his denial of any knowledge of the loss of the 30 boxes of
long copy paper from the OCA stockroom, but admitted that he had initiated the transfer upon the
instructions of Administrative Officer Recio. On his part, Austria conceded that he had used the 50
reams of papers to pay for the copy paper he had borrowed from one Mr. Roy of the Jimmy Roy
Trading, a supplier of toners, inks, and sometimes copy paper. He denied that the copy paper was
payment for his personal loan, maintaining that he had only borrowed the copy paper in order to avoid
delays for an upcoming PHILJA training.
After conducting the investigation, the OAS concluded that Ordoez had failed to exercise the
required diligence in the performance of his task in overseeing the delivery of the copy paper by not
seeing to the safe storage of the copy paper, and by not properly endorsing the copy paper to his office
or to the security guard assigned in the area where he had left the reams of copy paper. The OAS
found that Austria and Glor had committed perjury by giving false statements, as borne out by the
incongruence of their initial narration of facts and their subsequent statements blaming each other as
the perpetrator of the theft of the copy paper; that it was clear that their act of taking the copy paper
without authority constituted theft; that they were liable for serious dishonesty considering that their
acts were attended by certain circumstances that rendered their offense serious.
As to Carmona, the OAS observed that he was still responsible for securing the trip ticket as a
driver even if he had been requested to help Ordoez.
The OAS ultimately recommended as follows:
 I. For having been found guilty of Gross Dishonesty, Grave Misconduct and Conduct
Prejudicial to the Best Interest of the Service, Mesrs. Isidro T. Austria and Eusebio M.
Glor, be meted with the penalty of DISMISSAL from the service with forfeiture of
benefits except accrued leave credits;
II. For having been found guilty of Gross Neglect of Duty, Mr. Lenin Mario M. Ordoez,
be meted the penalty of DISMISSAL from the service with forfeiture of benefits except
accrued leave credits;
III. Mesrs. Austria, Glor and Ordoez, be directed to restitute to the Court the copy papers
stolen; and
IV. For driving without a trip ticket to the PHILJA Reproduction Room, Mr. Elizalde S.
Carmona, be WARNED that a repetition of similar acts in the future shall be dealt with
more severely.

Meanwhile, Ordoez resigned from the PHILJA, citing the approval of his familys visa application
for immigrant status in Canada as the reason for his resignation. On June 23, 2009, the Court En
Banc approved his resignation subject to the usual clearance requirements. The Third Division
directed the consolidation of A.M. No. 2014-025-Ret. with A.M. No. 2008-23-SC. The En Banc
accepted the consolidation.

ISSUE: Whether or not the findings and recommendations of the OAS should be upheld.

RULING: YES
There is grave misconduct when the elements of corruption, clear intent to violate the law, or
flagrant disregard of established rule are present. Dishonesty is defined as a disposition to lie, cheat,
deceive or defraud; untrustworthiness; lack of integrity; lack of honesty, probity or integrity in
principle; lack of fairness and straightforwardness. Both gross misconduct and dishonesty are grave
offenses that are punishable by dismissal even for the first offense. Conduct prejudicial to the best
interest of the service is also classified as a grave offense under Section 22(t) of the Omnibus Rules
Implementing Book V of Executive Order No. 292 and other pertinent Civil Service laws. The Civil
Service laws and rules contain no description of what specific acts constitute the grave offense of
conduct prejudicial to the best interest of the service. However, jurisprudence has been instructive,
with the Court having considered the following acts or omissions as constitutive of conduct
prejudicial to the best interest of the service, namely: (a) misappropriation of public funds; (b)
abandonment of office; (c) failure to report back to work without prior notice; (d) failure to keep
public records and property safe; (e) making false entries in public documents; and (f) falsification of
court orders.
For making false statements, committing perjury and stealing the copy paper, Austria and Glor
are guilty of grave misconduct, gross dishonesty, and conduct prejudicial to the best interest of the
service. Their dismissal from the service is the proper penalty, with forfeiture of retirement benefits,
except accrued leave credits, and perpetual disqualification from re-employment in the Government.
On August 17, 2012 and during the pendency of A.M. No. 2008-23-SC, Austria turned 65 years old
and was deemed compulsorily retired from the service. He applied for retirement benefits under
Republic Act No. 8291 (The Government Service Insurance Act of 1997), and his application was
docketed as A.M. No. 2014-025-Ret. The fact that Austria meanwhile reached the compulsory
retirement age did not render A.M. No. 2008-23-SC moot, let alone release him from whatever
liability he had incurred while in the active service. The jurisdiction acquired by the Court continues
despite his compulsory retirement. Indeed, the Court retains its jurisdiction to declare a respondent
either innocent or guilty of the charge even in the extreme case of the respondents supervening death.
Where a respondent is found guilty of a grave offense but the penalty of dismissal is no longer
possible because of his compulsory retirement, the Court has nevertheless imposed the just and
appropriate disciplinary measures and sanctions by decreeing the forfeiture of all benefits to which he
may be entitled, except accrued leave credits, with prejudice to re-employment in any branch or
instrumentality of the Government, including GOCCs, and by imposing a fine to be deducted from
the retirement benefits.
Austria is now being held guilty of the grave offenses of gross dishonesty and grave misconduct,
(either of which is punishable by dismissal for the first offense), as well as of conduct prejudicial to
the best interest of the service, but since the penalty of dismissal could no longer be imposed on him,
the Court forfeits all benefits to which he could be entitled, except accrued leave credits, with
prejudice to re-employment in any branch or instrumentality of the Government, including
Government-owned and Government-controlled corporations, and fines him in the amount equivalent
to his salary for his last six (6) months in the service to be deducted from whatever accrued leave
benefits remained for him. Hence, his request in A.M. No. 2014-025-Ret. for the release of his
compulsory retirement benefits under R.A. No. 8291 is denied.
Ordoez is guilty of gross neglect of duty. Even if he did not have a direct hand in the theft of the
copy paper, his negligence facilitated the theft. Had he been diligent in performing his tasks and
responsibilities as a Storekeeper IV, Austria and Glor would not have managed to take out the reams
of copy paper out of the stockroom, of which he was then in charge. Indeed, he so admitted this
during the investigation. Neglect of duty is the failure to give ones attention to a task expected of
him. Gross neglect is such neglect that, from the gravity of the case or the frequency of instances,
becomes so serious in its character as to endanger or threaten the public welfare. Those responsible for
such act or omission cannot escape the disciplinary power of this Court. The imposable penalty for
gross neglect of duty is dismissal from the service.
Ordoez resigned effective May 4, 2009, purportedly to migrate to Canada. His resignation would not
extricate him from the consequences of his gross neglect of duty, because the Court has not allowed
resignation to be an escape or an easy way out to evade administrative liability or administrative
sanction. Ordoez remains administratively liable, but his resignation prevents his dismissal from the
service. A fine can be imposed, instead, and its amount is subject to the sound discretion of the
Court. The fine shall be deducted from any accrued leave credits, with the respondent being
personally liable for any deficiency that should be directly payable to this Court. He is further
declared disqualified from any future government service.
The recommended sanction for Cardona is warning. Such sanction is sufficient considering that
Ordoez merely solicited the help of Cardona in transferring the reams of copy paper from the OCA
stockroom to the Repro Room in the SC New Building. We emphasize that all court employees, being
public servants in the Judiciary, must always act with a high degree of professionalism and
responsibility. To maintain the peoples respect and faith in the Judiciary, they should be upright, fair
and honest. They should avoid any act or conduct that tends to diminish public trust and confidence in
the courts.
 A CADEMICUS REVIEW CENTER
Dean Ferdinand A. Tan

REMEDIAL LAW CASES ( 2012 - 2016)

J. BERSAMIN

CIVIL PROCEDURE
Douglas Cagas vs. Commission on Elections and Claude Bautista
G.R. No. 194139, January 24, 2012
BERSAMIN, J.:
A party aggrieved by an interlocutory order issued by a Division of the Commission on Elections (COMELEC)
in an election protest may not directly assail the order in this Court through a special civil action
for certiorari. The remedy is to seek the review of the interlocutory order during the appeal of the decision of
the Division in due course.
FACTS:
The petitioner and respondent Claude P. Bautista contested the position of Governor of the Province of Davao
del Sur in the May 10, 2010 automated national and local elections. The fast transmission of the results led to
the completion by May 14, 2010 of the canvassing of votes cast for Governor of Davao del Sur, and the
petitioner was proclaimed the winner (with 163,440 votes), with Bautista garnering 159,527 votes. Alleging
fraud, anomalies, irregularities, vote-buying and violations of election laws, rules and resolutions, Bautista filed
an electoral protest. The petitioner averred as his special affirmative defenses that Bautista did not make the
requisite cash deposit on time; and that Bautista did not render a detailed specification of the acts or omissions
complained of. COMELEC First Division issued the first assailed order denying the special affirmative
defenses of the petitioner. COMELEC First Division issued its second assailed order, denying the petitioners
motion for reconsideration for failing to show that the first order was contrary to law.

ISSUE: Whether the Court can take cognizance of the petition for certiorari.

RULING: No
The governing provision is Section 7, Article IX of the 1987 Constitution. This provision, although it confers
on the Court the power to review any decision, order or ruling of the COMELEC, limits such power to
a final decision or resolution of the COMELEC en banc, and does not extend to an interlocutory order issued
by a Division of the COMELEC. Otherwise stated, the Court has no power to review on certiorari an
interlocutory order or even a final resolution issued by a Division of the COMELEC.
There is no question, therefore, that the Court has no jurisdiction to take cognizance of the petition
for certiorari assailing the denial by the COMELEC First Division of the special affirmative defenses of the
petitioner. The proper remedy is for the petitioner to wait for the COMELEC First Division to first decide the
protest on its merits, and if the result should aggrieve him, to appeal the denial of his special affirmative
defenses to the COMELEC en banc along with the other errors committed by the Division upon the merits.
It is true that there may be an exception to the general rule, as the Court conceded in Kho v.
Commission on Elections. In that case, the protestant assailed the order of the COMELEC First Division
admitting an answer with counter-protest belatedly filed in an election protest by filing a petition
for certiorari directly in this Court on the ground that the order constituted grave abuse of discretion on the part
of the COMELEC First Division. Under the exception, therefore, the Court may take cognizance of a petition
for certiorari under Rule 64 to review an interlocutory order issued by a Division of the COMELEC on the
ground of the issuance being made without jurisdiction or in excess of jurisdiction or with grave abuse of
discretion amounting to lack or excess of jurisdiction when it does not appear to be specifically provided under
the COMELEC Rules of Procedure that the matter is one that the COMELEC en banc may sit and consider, or
a Division is not authorized to act, or the members of the Division unanimously vote to refer to the
COMELEC en banc. Of necessity, the aggrieved party can directly resort to the Court because the
COMELEC en banc is not the proper forum in which the matter concerning the assailed interlocutory order can
be reviewed.
 However, the Kho v. Commission on Elections exception has no application herein, because the
COMELEC First Division had the competence to determine the lack of detailed specifications of the acts or
omissions complained of as required by Rule 6, Section 7 of COMELEC Resolution No. 8804, and whether
such lack called for the outright dismissal of the protest. For sure, the 1987 Constitution vested in the
COMELEC broad powers involving not only the enforcement and administration of all laws and regulations
relative to the conduct of elections but also the resolution and determination of election controversies. The
breadth of such powers encompasses the authority to determine the sufficiency of allegations contained in
every election protest and to decide based on such allegations whether to admit the protest and proceed with the
hearing or to outrightly dismiss the protest in accordance with Section 9, Rule 6 of COMELEC Resolution No.
8804.

Metropolitan Bank and Trust Co. vs. Antonino Tobias III

G.R. No. 177780, January 25, 2012
BERSAMIN, J.:
Under the doctrine of separation of powers, the courts have no right to directly decide matters over which full
discretionary authority has been delegated to the Executive Branch of the Government, or to substitute their
own judgments for that of the Executive Branch, represented in this case by the Department of Justice. The
settled policy is that the courts will not interfere with the executive determination of probable cause for the
purpose of filing an information, in the absence of grave abuse of discretion.
FACTS:
In 1997, Rosella A. Santiago, then the OIC-Branch Head of Metropolitan Bank & Trust Company
(METROBANK) in Valero Street, Makati City, was introduced to respondent Antonino O. Tobias III by one
Jose Eduardo Gonzales, a valued client of METROBANK. Subsequently, Tobias opened a savings/current
account for and in the name of Adam Merchandising, his frozen meat business. Six months later, Tobias
applied for a loan from METROBANK, which in due course conducted trade and credit verification of Tobias
that resulted in negative findings. METROBANK next proceeded to appraise the property Tobias offered as
collateral by asking him for a photocopy of the title and other related documents. Based on the financial
statements submitted by Tobias, METROBANK approved a credit line for P40,000,000.00. On August 15,
1997, Joselito Bermeo Moreno, Lead Internal Affairs Investigator of METROBANK, proceeded to the Registry
of Deeds of Malabon to cause the annotation of the deed of real estate mortgage.
Thereafter, Tobias initially availed himself of P20,000,000, but took out the balance within six months. He paid
the interest on the loan for about a year before defaulting. His loan was restructured to 5-years upon his request.
Yet, after two months, he again defaulted. Thus, the mortgage was foreclosed, and the property was sold to
METROBANK as the lone bidder.
When the certificate of sale was presented for registration to the Registry of Deeds of Malabon, no
corresponding original copy of TCT No. M-16751 was found in the registry vault. Atty. Sarah Principe-Bido,
Deputy Register of Deeds of Malabon, went on to verify TCT No. M-16751 and learned that Serial No.
4348590 appearing therein had been issued for TCT No. M-15363 in the name of one Alberto Cruz; while TCT
No. 16751 (now TCT No. 390146) appeared to have been issued in the name of Eugenio S. Cruz and Co. for a
parcel of land located in Navotas. Given such findings, METROBANK requested the Presidential Anti-
Organized Crime Task Force (PAOCTF) to investigate. In its report, PAOCTF concluded that TCT No. M-
16751 and the tax declarations submitted by Tobias were fictitious. PAOCTF recommended the filing against
Tobias of a criminal complaint for estafa through falsification of public documents under paragraph 2 (a) of
Article 315, in relation to Articles 172(1) and 171(7) of the Revised Penal Code.

The Office of the City Prosecutor of Malabon ultimately charged Tobias with estafa through falsification of
public documents. the City Prosecutor of Malabon still found probable cause against Tobias, and recommended
his being charged with estafa through falsification of public document. Tobias appealed to the Department of
Justice (DOJ). Then Acting Secretary of Justice Ma. Merceditas N. Gutierrez issued a resolution directing the
withdrawal of the information filed against Tobias. CA promulgated its decision, dismissing METROBANKs
petition for certiorari by holding that the presumption of authorship might be disputed through a satisfactory
explanation.

ISSUE: Whether or not CA erred in denying Metrobanks petition for certiorari

RULING:
Under the doctrine of separation of powers, the courts have no right to directly decide matters over which full
discretionary authority has been delegated to the Executive Branch of the Government, or to substitute their
own judgments for that of the Executive Branch, represented in this case by the Department of Justice. The
settled policy is that the courts will not interfere with the executive determination of probable cause for the
purpose of filing an information, in the absence of grave abuse of discretion. That abuse of discretion must be
so patent and gross as to amount to an evasion of a positive duty or a virtual refusal to perform a duty enjoined
by law or to act at all in contemplation of law, such as where the power is exercised in an arbitrary and despotic
manner by reason of passion or hostility.
In this regard, we stress that a preliminary investigation for the purpose of determining the existence of
probable cause is not part of a trial. At a preliminary investigation, the investigating prosecutor or the Secretary
of Justice only determines whether the act or omission complained of constitutes the offense charged. Probable
cause refers to facts and circumstances that engender a well-founded belief that a crime has been committed
and that the respondent is probably guilty thereof. There is no definitive standard by which probable cause is
determined except to consider the attendant conditions; the existence of probable cause depends upon the
finding of the public prosecutor conducting the examination, who is called upon not to disregard the facts
presented, and to ensure that his finding should not run counter to the clear dictates of reason.

Tobias was charged with estafa through falsification of public document the elements of which are: (a) the
accused uses a fictitious name, or falsely pretends to possess power, influence, qualifications, property, credit,
agency, business or imaginary transactions, or employs other similar deceits; (b) such false pretense, fraudulent
act or fraudulent means must be made or executed prior to or simultaneously with the commission of the fraud;
(c) the offended party must have relied on the false pretense, fraudulent act or fraudulent means, that is, he was
induced to part with his money or property because of the false pretense, fraudulent act or fraudulent means;
and (d) as a result thereof, the offended party suffered damage. It is required that the false statement or
fraudulent representation constitutes the very cause or the only motive that induced the complainant to part
with the thing.

Firstly, a presumption affects the burden of proof that is normally lodged in the State. The effect is to create the
need of presenting evidence to overcome the prima facie case that shall prevail in the absence of proof to the
contrary. As such, a presumption of law is material during the actual trial of the criminal case where in the
establishment thereof the party against whom the inference is made should adduce evidence to rebut the
presumption and demolish the prima facie case. This is not so in a preliminary investigation, where the
investigating prosecutor only determines the existence of a prima facie case that warrants the prosecution of a
criminal case in court.

Secondly, the presumption of authorship, being disputable, may be accepted and acted upon where no evidence
upholds the contention for which it stands. It is not correct to say, consequently, that the investigating
prosecutor will try to determine the existence of the presumption during preliminary investigation, and then to
disregard the evidence offered by the respondent. The fact that the finding of probable cause during a
preliminary investigation is an executive function does not excuse the investigating prosecutor or the Secretary
of Justice from discharging the duty to weigh the evidence submitted by the parties. Towards that end, the
investigating prosecutor, and, ultimately, the Secretary of Justice have ample discretion to determine the
existence of probable cause, a discretion that must be used to file only a criminal charge that the evidence and
inferences can properly warrant.

We do not lose sight of the fact that METROBANK, a commercial bank dealing in real property, had the duty
to observe due diligence to ascertain the existence and condition of the realty as well as the validity and
integrity of the documents bearing on the realty. Its duty included the responsibility of dispatching its
competent and experience representatives to the realty to assess its actual location and condition, and of
investigating who was its real owner. Yet, it is evident that METROBANK did not diligently perform a
thorough check on Tobias and the circumstances surrounding the realty he had offered as collateral. As such, it
had no one to blame but itself. Verily, banks are expected to exercise greater care and prudence than others in
their dealings because their business is impressed with public interest. Their failure to do so constitutes
negligence on its part.
Priscilla Alma Jose vs. Ramon Javellana et al
G.R. No. 158239, January 25, 2012
BERSAMIN, J.:
The denial of a motion for reconsideration of an order granting the defending partys motion to dismiss
is not an interlocutory but a final order because it puts an end to the particular matter involved, or settles
definitely the matter therein disposed of, as to leave nothing for the trial court to do other than to execute the
order. Accordingly, the claiming party has a fresh period of 15 days from notice of the denial within which to
appeal the denial.
FACTS:
Margarita Marquez Alma Jose sold for consideration of P160,000.00 to respondent Ramon Javellana
by deed of conditional sale two parcels of land with areas of 3,675 and 20,936 square meters located in
Barangay Mallis, Guiguinto, Bulacan. They agreed that Javellana would pay P80,000.00 upon the execution of
the deed and the balance of P80,000.00 upon the registration of the parcels of land under the Torrens System
(the registration being undertaken by Margarita within a reasonable period of time); and that should Margarita
become incapacitated, her son and attorney-in-fact, Juvenal M. Alma Jose (Juvenal), and her daughter,
petitioner Priscilla M. Alma Jose, would receive the payment of the balance and proceed with the application
for registration. After Margarita died and with Juvenal having predeceased Margarita without issue, the vendors
undertaking fell on the shoulders of Priscilla, being Margaritas sole surviving heir. However, Priscilla did not
comply with the undertaking to cause the registration of the properties under the Torrens System, and, instead,
began to improve the properties by dumping filling materials therein with the intention of converting the
parcels of land into a residential or industrial subdivision. Faced with Priscillas refusal to comply, Javellana
commenced on February 10, 1997 an action for specific performance, injunction, and damages against her in
the Regional Trial Court.

ISSUE: Whether or not CA erred in not outrightly dismissing Javellanas appeal because (a) the June 21, 2000
RTC order was not appealable; (b) the notice of appeal had been filed belatedly by three days

RULING:
Denial of the motion for reconsideration of the order of dismissal was a final order and appealable
First of all, the denial of Javellanas motion for reconsideration left nothing more to be done by the RTC
because it confirmed the dismissal of Civil Case No. 79-M-97. It was clearly a final order, not an interlocutory
one. And, secondly, whether an order is final or interlocutory determines whether appeal is the correct remedy
or not. A final order is appealable, to accord with the final judgment rule enunciated in Section 1, Rule 41 of
the Rules of Court to the effect that 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; but the
remedy from an interlocutory one is not an appeal but a special civil action for certiorari. Indeed, the Court has
held that an appeal from an order denying a motion for reconsideration of a final order or judgment is
effectively an appeal from the final order or judgment itself; and has expressly clarified
that the prohibition against appealing an order denying a motion for reconsideration referred only to a denial of
a motion for reconsideration of an interlocutory order.

Appeal was made on time pursuant to Neypes v. CA

Under Section 3 of Rule 41 of the Rules of Court, Javellana had only the balance of three days from
July 13, 2000, or until July 16, 2000, within which to perfect an appeal due to the timely filing of his motion for
reconsideration interrupting the running of the period of appeal. As such, his filing of the notice of appeal only
on July 19, 2000 did not perfect his appeal on time, as Priscilla insists. The seemingly correct insistence of
Priscilla cannot be upheld, however, considering that the Court meanwhile adopted the fresh period
rule in Neypes v. Court of Appeals, by which an aggrieved party desirous of appealing an adverse judgment or
final order is allowed a fresh period of 15 days within which to file the notice of appeal in the RTC reckoned
from receipt of the order denying a motion for a new trial or motion for reconsideration. The fresh period
rule may be applied to this case, for the Court has already retroactively extended the fresh period
rule to actions pending and undetermined at the time of their passage and this will not violate any right of a
person who may feel that he is adversely affected, inasmuch as there are no vested rights in rules of procedure.
Rolando Sofio and Rufio Sofio vs. Alberto Valenzuela et al
G.R. No. 157810, February 15, 2012
BERSAMIN, J.:
The Court will not override the finality and immutability of a judgment based only on the negligence of a
partys counsel in timely taking all the proper recourses from the judgment. To justify an override, the counsels
negligence must not only be gross but must also be shown to have deprived the party the right to due process.
FACTS:
Respondents Alberto, Gloria, Remedios, and Cesar, all surnamed Valenzuela, are brothers and sisters.
They are the co-owners of a parcel of agricultural land designated as Lot No. 970-B and located in Barangay
Ayungon, Valladolid, Negros Occidental. Alberto had been planting sugarcane in the entire property, but poor
drainage had led him to abandon his cultivation in 1978 of an .80-hectare portion of the property. Unknown to
the respondents, petitioner Rolando Sofio, a son of their tenant in another lot, had obtained permission to farm
the abandoned area for free from Socorro Valenzuela, the respondents mother who was then still managing the
property. She had acceded to the request on condition that Rolando would return the portion once the owners
needed it. In succeeding years, Alberto had also left other portions of the property uncultivated because of the
low price of sugar. Apparently, Rolando had also taken over the vacated portions to plant palay. He shared the
cultivation with his brother, co-petitioner Rufio Sofio.
In 1985, respondent Gloria learned for the first time that Rolando had been permitted by her mother to
cultivate the .80 hectare portion without paying any rentals; and that the petitioners had actually expanded their
cultivation to a total area of 1.8 hectares. After the petitioners refused her demand for the return of the 1.8
hectares, she lodged a complaint against Rolando with the Barangay Chairman of Ayungon, Valladolid, Negros
Occidental, and the Municipal Agrarian Reform Officer (MARO). The parties did not reach an amicable
settlement.
The petitioners, along with Wilma Sofio, their sister who had succeeded their father as the tenant of
respondents other property, informed Gloria that, being the identified tenants under Presidential Decree No. 27,
they had already paid the rentals on the portions they were cultivating, and that they would be paying
subsequent rentals to the Land Bank of the Philippines (LBP). Emancipation patents (EPs) were issued to
Rolando and Rufio covering their respective areas of tillage.
Respondents brought in the Department of Agrarian Reform Adjudication Board (DARAB) a
complaint against the petitioners, seeking the cancellation of the EPs, recovery of possession, and damages,
alleging that the petitioners cultivation of their land had been illegal because they had not consented to it.
Provincial Agrarian Reform Adjudicator (PARAD) of Negros Occidental, ordered the cancellation of
petitioners EPs. DARAB reversed the ruling of the PARAD. The respondents elevated the DARABs decision
to the CA. CA granted the petition for review. The decision of May 27, 1998 became final and executory on
October 27, 1998 after the petitioners neither moved for reconsideration nor appealed by certiorari to the
Court. The writ of execution was issued on January 23, 2002. The petitioners, represented by new counsel, filed
in the PARAD a motion for relief from judgment, motion for reconsideration of the order dated November 27,
2001, and motion to recall writ of execution dated January 23, 2002.

ISSUE: Whether or not the petition must be denied

RULING: Yes
The Court finds no cause to disturb the decision of the and cannot undo the decision upon the grounds
cited by the petitioners, especially as the decision had long become final and executory.
A decision that has acquired finality becomes immutable and unalterable and may no longer
be modified in any respect even if the modification is intended 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. This doctrine
of finality and immutability of judgments is grounded on fundamental considerations of public policy and
sound practice to the effect that, at the risk of occasional error, the judgments of the courts must become final at
some definite date set by law. The reason is that litigations must end and terminate sometime and somewhere;
and it is essential for the effective and efficient administration of justice that once a judgment has become final
the winning party should not be deprived of the fruits of the verdict.

Given this doctrine, courts must guard against any scheme calculated to bring about that result, and
must frown upon any attempt to prolong controversies. The only exceptions to the general rule are: (a) the
correction of clerical errors; (b) the so-called nunc pro tunc entries that cause no prejudice to any party; (c) void
judgments; and (d) whenever circumstances transpire after the finality of the judgments rendering execution
unjust and inequitable. None of the exceptions obtains here.

The petitioners claim that their former counsel was guilty of gross negligence for letting the CA decision
lapse into finality by not filing a motion for reconsideration or by not appealing in due course to the
Court.
Although the petitioners former counsel was blameworthy for the track their case had taken, there is no
question that any act performed by the counsel within the scope of his general or implied authority is still
regarded as an act of the client. In view of this, even the negligence of the former counsel should bind them as
his clients. To hold otherwise would result to the untenable situation in which every defeated party, in order to
salvage his cause, would simply claim neglect or mistake on the part of his counsel as a ground for reversing
the adverse judgment. There would then be no end to litigation, for every shortcoming of the counsel could
become the subject of challenge by his client through another counsel who, if he should also be found wanting,
would similarly be disowned by the same client through yet another counsel, and so on ad infinitum.
Nonetheless, the gross negligence of counsel alone would not even warrant a deviation from the
principle of finality of judgment, for the client must have to show that such negligence resulted in the denial of
due process to the client. When the counsels mistake is so great and so serious that the client is prejudiced and
is denied his day in court, or when the counsel is guilty of gross negligence resulting in the clients deprivation
of his property without due process of law, the client is not concluded by his counsels mistakes and the case can
be reopened in order to give the client another chance to present his case. As such, the test herein is whether
their former counsels negligence deprived the petitioners of due process of law.
For one to properly claim gross negligence on the part of his counsel, he must show that the counsel
was guilty of nothing short of a clear abandonment of the clients cause. Considering that the Court has held that
the failure to file the appellants brief can qualify as simple negligence but cannot amount to gross negligence
that justifies the annulment of the proceedings, the failure to file an appellees brief may be similarly treated.
The petitioners were able to participate in the proceedings before the PARAD and the DARAB, and, in fact,
obtained a favorable judgment from the DARAB. They also had a similar opportunity to ventilate their cause in
the CA. That they had not been able to avail themselves of all the remedies open to them did not give them the
justification to complain of a denial of due process. They could not complain because they were given the
opportunity to defend their interest in due course, for it was such opportunity to be heard that was the essence
of due process.

Nerwin Industries Corp. vs. PNOC-Energy Development Corp.

G.R. No. 167057, April 11, 2012
BERSAMIN, J.:
Republic Act No. 8975 expressly prohibits any court, except the Supreme Court, from issuing any temporary
restraining order (TRO), preliminary injunction, or preliminary mandatory injunction to restrain, prohibit or
compel the Government, or any of its subdivisions or officials, or any person or entity, whether public or
private, acting under the Governments direction, from: (a) acquiring, clearing, and developing the right-of-
way, site or location of any National Government project; (b) bidding or awarding of a contract or project of
the National Government; (c) commencing, prosecuting, executing, implementing, or operating any such
contract or project; (d) terminating or rescinding any such contract or project; and (e) undertaking or
authorizing any other lawful activity necessary for such contract or project.
Accordingly, a Regional Trial Court (RTC) that ignores the statutory prohibition and issues a TRO or
a writ of preliminary injunction or preliminary mandatory injunction against a government contract or project
acts contrary to law.
FACTS:
In 1999, the National Electrification Administration (NEA) published an invitation to pre-qualify and to
bid for a contract, otherwise known as IPB No. 80, for the supply and delivery of about 60,000 pieces of
woodpoles and 20,000 pieces of cross-arms needed in the countrys Rural Electrification Project. bidders, such
as private respondent, were required to submit their application for eligibility together with their technical
proposals. Following a thorough review of the bidders qualifications and eligibility, only four (4) bidders,
including private respondent, qualified to participate in the bidding for the IPB-80 contract. Private respondent
emerged as the lowest bidder for all schedules/components of the contract. NEA then conducted a pre-award
inspection of private respondents manufacturing plants and facilities to determine its capability to supply and
 deliver NEAs requirements. NEA administrator Conrado M. Estrella III recommended to NEAs Board of
Directors the approval of award to private respondent.
However, NEAs Board of Directors passed Resolution No. 32 reducing by 50% the material
requirements for IBP No. 80 given the time limitations for the delivery of the materials, and with the loan
closing date of October 2001 fast approaching. In turn, it resolved to award the 4 schedules of IBP No. 80 at a
reduced number to private respondent. Private respondent protested the said 50% reduction, alleging that the
same was a ploy to accommodate a losing bidder. NEA allegedly held negotiations with other bidders relative
to the IPB-80 contract, prompting private respondent to file a complaint for specific performance with prayer
for the issuance of an injunction, which injunctive application was granted. Nerwin another filed a civil action
in the RTC in Manila alleging that Requisition No. FGJ 30904R1 (an invitation to pre-qualify and to bid for
wooden poles needed for its Samar Rural Electrification Project) was an attempt to subject a portion of the
items covered by IPB No. 80 to another bidding; and praying that a TRO issue to enjoin respondents proposed
bidding for the wooden poles. RTC issued preliminary injunction enjoining the defendant PNOC-EDC and its
Chairman of Bids and Awards Committee Esther R. Guerzon from continuing the holding of the subject
bidding.
Respondents commenced in the CA a special civil action for certiorari, alleging that the RTC had
thereby committed grave abuse of discretion amounting to lack or excess of jurisdiction in holding that Nerwin
had been entitled to the issuance of the writ of preliminary injunction despite the express prohibition from the
law and from the Supreme Court; in issuing the TRO in blatant violation of the Rules of Court and established
jurisprudence.

ISSUE: Whether or not the CA erred in dismissing the case on the basis of Rep. Act 8975 prohibiting the
issuance of temporary restraining orders and preliminary injunctions, except if issued by the Supreme Court, on
government projects.

RULING: No

The RTC gravely abused its discretion, firstly, when it entertained the complaint of Nerwin against
respondents notwithstanding that Nerwin was thereby contravening the express provisions of Section 3 and
Section 4 of Republic Act No. 8975 for its seeking to enjoin the bidding out by respondents of the O-ILAW
Project; and, secondly, when it issued the TRO and the writ of preliminary prohibitory injunction.
Section 3. Prohibition on the Issuance of Temporary Restraining Orders, Preliminary Injunctions and
Preliminary Mandatory Injunctions. No court, except the Supreme Court, shall issue any temporary restraining
order, preliminary injunction or preliminary mandatory injunction against the government, or any of its
subdivisions, officials or any person or entity, whether public or private, acting under the governments
direction, to restrain, prohibit or compel the following acts:
(b) Bidding or awarding of contract/project of the national government as defined under Section 2
hereof;
Section 4. Nullity of Writs and Orders. - Any temporary restraining order, preliminary injunction or
preliminary mandatory injunction issued in violation of Section 3 hereof is void and of no force and
effect.

A preliminary injunction is an order granted at any stage of an action or proceeding prior to the
judgment or final order, requiring a party or a court, agency or person, to refrain from a particular act or acts. It
is an ancillary or preventive remedy resorted to by a litigant to protect or preserve his rights or interests during
the pendency of the case. As such, it is issued only when it is established that:
(a) The applicant is entitled to the relief demanded, and the whole or part of such relief consists in restraining the
commission or continuance of the act or acts complained of, or in requiring the performance of an act or acts,
either for a limited period or perpetually; or
(b) The commission, continuance or non-performance of the act or acts complained of during the litigation would
probably work injustice to the applicant; or
(c) A party, court, agency or a person is doing, threatening, or is attempting to do, or is procuring or suffering to be
done, some act or acts probably in violation of the rights of the applicant respecting the subject of the action or
proceeding, and tending to render the judgment ineffectual.
In this regard, the Rules of Court grants a broad latitude to the trial courts considering that conflicting claims in
an application for a provisional writ more often than not involve and require a factual determination that is not
the function of the appellate courts. Nonetheless, the exercise of such discretion must be sound, that is, the
issuance of the writ, though discretionary, should be upon the grounds and in the manner provided by
law. When that is done, the exercise of sound discretion by the issuing court in injunctive matters must not be
interfered with except when there is manifest abuse.

Philippine Overseas Telecommunications Corp. and PhilcomSat vs. Victor Africa

G.R. No. 184622, July 3, 2013
BERSAMIN:
In intra-corporate dispute involving a corporation under sequestration of the Presidential Commission on
Good Government (PCGG) falls under the jurisdiction of the Regional Trial Court (RTC), not the
Sandiganbayan.
FACTS:
The ownership structure of POTC, PHILCOMSTAT and PHC implies that whoever had control of POTC
necessarily held 100% control of PHILCOMSAT, and in turn whoever controlled PHILCOMSAT wielded 81%
majority control of PHC. Records reveal that POTC has been owned by seven families through their
individual members or their corporations, namely: (a) the Ilusorio Family; (b) the Nieto Family; (c) the
Poblador Family; (d) the Africa Family; (e) the Benedicto Family; (f) the Ponce Enrile Family; and (g) the
Elizalde Family. Atty. Potenciano Ilusorio, the patriarch of the Ilusorio Family, owned shares of stock in
POTC. A block consisting of 5,400 POTC shares of stock has become the bone of contention in a prolonged
controversy among the parties. Atty. Ilusorio claimed that he had incurred the ire of Imelda Marcos during the
regime of President Marcos, leading to the Marcos spouses grabbing from him the POTC shares of stock
through threats and intimidation and without any valuable consideration, and placing such shares under the
names of their alter egos, namely: 3,644 shares in the name of Independent Realty Corporation (IRC); 1,755
shares in the name of MidPasig Land Development (Mid-Pasig); and one share in the name of Ferdinand
Marcos, Jr.
EDSA People Power Revolution deposed President Marcos from power and forced him and his family to flee
the country. On February 28, 1986, newly-installed President Corazon C. Aquino issued Executive Order No. 1
to create the PCGG whose task was to assist the President in the recovery of all ill-gotten wealth amassed by
President Marcos, his immediate family, relatives, subordinates and close associates, whether located in the
Philippines or abroad, through the takeover or sequestration of all business enterprises and entities owned or
controlled by them during President Marcos administration, directly or through nominees, by taking undue
advantage of their public office and/or using their powers, authority, influence, connections or relationships.
With 39.92% of the POTC shareholdings under its control, the PCGG obtained three out of the seven seats in
the POTC Board of Directors. At the time, Manuel Nieto, Jr. was the President of both POTC and
PHILCOMSAT. However, Nieto, Jr. had a falling out with other stockholders. To keep control of the POTC
and PHILCOMSAT, Nieto, Jr. aligned with the PCGG nominees to enable him to wrest four out of seven seats
in the POTC Board of Directors and five out of the nine seats in the PHILCOMSAT Board of Directors. Thus,
Nieto, Jr. remained as the President of POTC and PHILCOMSAT.7
Government, represented by the PCGG, filed in the Sandiganbayan a Complaint for reconveyance, reversion,
accounting, restitution and damages against Jose L. Africa, Manuel H. Nieto, Jr., President Marcos, Imelda R.
Marcos, Ferdinand R. Marcos, Jr., Roberto S. Benedicto, Juan Ponce Enrile and Atty. Potenciano Ilusorio.8
The Complaint, docketed as SB Civil Case No. 009, alleged that the defendants acted in collaboration with
each other as dummies, nominees and/or agents of defendants Ferdinand E. Marcos, Imelda R. Marcos and
Ferdinand R. Marcos, Jr. in several corporations, such as the Mid-Pasig Land Development Corporation and the
Independent Realty Corporation which, through manipulations by said defendants, appropriated a substantial
portion of the shareholdings in Philippine Overseas Telecommunications Corporation and Philippine
Communications Satellite Corporation held by the late Honorio Poblador, Jr., Jose Valdez and Francisco
Reyes, thereby further advancing defendants scheme to monopolize the telecommunications industry; that
through their illegal acts, they acquired ill-gotten wealth; that their acts constituted breach of public trust and
the law, abuse of rights and power, and unjust enrichment; and that their illgotten wealth, real and personal,
are deemed to have been acquired (by them) for the benefit of the plaintiff (Republic) and are, therefore,
impressed with constructive trust in favor of (the latter) and the Filipino people.
The Ilusorio Familys shareholding became 18.12%, while that of the PCGG (through IRC and Mid-Pasig) was
reduced to 34.94%. With its reduced shareholdings, the PCGGs number of seats in the POTC Board settled at
only two. The Ilusorio Family continued its alliance with the Africa, Poblador, Benedicto and Ponce Enrile
Families. In effect, the compromise agreement tilted the control in POTC, PHILCOMSAT and PHC, such that
the alliance between the Nieto Family and the PCGG, theretofore dominant, became the minority.
After a decade of litigation, the Republic, IRC and Mid-Pasig, and the PCGG (acting through PCGG
Commissioner Hermilo Rosal) entered into a compromise agreement with Atty. Ilusorio, whereby Atty.
Ilusorio recognized the ownership of the Republic over 4,727 of the POTC shares of stock in the names of IRC
and Mid-Pasig, and, in turn, the Republic acknowledged his ownership of 673 of the POTC shares of stock and
undertook to dismiss Civil Case No. 009 as against him. President Ramos approved the compromise agreement,
and directed its submission to the Sandiganbayan for approval through his marginal note dated October 5,
1996. Mid-Pasig, represented by Salonga, filed in the Sandiganbayan in Civil Case No. 009 a Motion to Vacate
the order dated June 8, 1998 approving the compromise agreement. Following the enactment of Republic Act
No. 8799 (Securities Regulation Code),26 SEC Case No. 09-98-6086 was transferred to the RTC in Makati
City, which re-docketed it as Civil Case No. 01-840 and raffled it to Branch 138. The Sandiganbayan
promulgated a resolution in SB Civil Case No. 009 denying IRC and Mid-Pasigs motions to vacate the order
approving the compromise agreement

ISSUE: Whether RTC or Sandiganbayan has jurisdiction over the case

RULING:
RTC (Branch 138) had jurisdiction over the election contest between the Ilusorio-Africa Groups and
Nieto-Locsin Groups
SB Civil Case No. 0198 of the Sandiganbayan involved intra-corporate controversies among the stockholders
and officers of the corporations. It is settled that there is an intra-corporate controversy when the dispute
involves any of the following relationships, to wit: (a) between the corporation, partnership or association and
the public; (b) between the corporation, partnership or association and the State in so far as its franchise, permit
or license to operate is concerned; (c) between the corporation, partnership or association and its stockholders,
partners, members or officers; and (d) among the stockholders, partners or associates themselves.
Consequently, we agree with the CAs consolidated decision promulgated on September 30, 2008 that the RTC
(Branch 138), not the Sandiganbayan, had jurisdiction because Civil Case No. 04-1049 did not involve a
sequestration-related incident but an intra-corporate controversy.
Originally, Section 5 of Presidential Decree (P.D.) No. 902-A vested the original and exclusive jurisdiction
over cases in the SEC. Upon the enactment of Republic Act No. 8799 (The Securities Regulation Code),
effective on August 8, 2000, the jurisdiction of the SEC over intra-corporate controversies and the other cases
enumerated in Section 5 of P.D. No. 902-A was transferred to the Regional Trial Court pursuant to Section 5.2
of the law. Conformably with Republic Act No. 8799, and with the ensuing resolutions of the Court on the
implementation of the transfer of jurisdiction to the Regional Trial Court, the RTC (Branch 138) in Makati had
the authority to hear and decide the election contest between the parties herein. There should be no
disagreement that jurisdiction over the subject matter of an action, being conferred by law, could neither be
altered nor conveniently set aside by the courts and the parties. Moreover, the jurisdiction of the Sandiganbayan
has been held not to extend even to a case involving a sequestered company notwithstanding that the majority
of the members of the board of directors were PCGG nominees.

Lack of pre-trial was not fatal in intra-corporate election contests

Under Section 4 of Rule 6 (Election Contests) of the Interim Rules of Procedure for Intra-Corporate
Controversies, which took effect on April 1, 2001 (A.M. No. 01-2-04-SC), issued pursuant to Republic Act No.
8799, the trial court, within two days from the filing of the complaint, may outrightly dismiss the complaint
upon a consideration of the allegations thereof if the complaint is not sufficient in form and substance, or, if the
complaint is sufficient, may order the issuance of summons which shall be served, together with a copy of the
complaint, on the defendant within two days from its issuance. Should it find the need to hold a hearing to
clarify specific factual matters, the trial court shall set the case for hearing, and the hearing shall be completed
not later than 15 days from the date of the first hearing. The trial court is mandated to render a decision within
15 days from receipt of the last pleading, or from the date of the last hearing, as the case may be.
The CA correctly pointed out that Rule 6 nowhere required that the RTC acting as a special commercial court
should first conduct a pre-trial conference before it could render its judgment in a corporate election contest.
Hence, the RTC (Branch 138) in Makati properly heard the case of annulment of the election with dispatch in
accordance with the guidelines set in the resolution in A.M. No. 01-2-04-SC. With the requirements of due
process having been served, no defect infirmed the RTCs ruling to set aside the election, and to oust those
illegally elected.

Proper mode of appeal in intra-corporate cases is by petition for review under Rule 43
The rule providing that a petition for review under Rule 43 of the Rules of Court is the proper mode of appeal
in intra-corporate controversies, as embodied in A. M. No. 04-9-07-SC, has been in effect since October 15,
2004. Hence, the filing by POTC and PHC (Nieto Group) of the petition for certiorari on March 21, 2007
(C.A.-G.R. SP No. 98399) was inexcusably improper and ineffectual. By virtue of its being an extraordinary
remedy, certiorari could neither replace nor substitute an adequate remedy in the ordinary course of law, like
appeal in due course.149 Indeed, the appeal under Rule 43 of the Rules of Court would have been adequate to
review and correct even the grave abuse of discretion imputed to the RTC. As a consequence of the impropriety
and ineffectuality of the remedy chosen by POTC and PHC (Nieto Group), the TRO and the WPI initially
issued by the CA in C.A.-G.R. SP No. 98399 did not prevent the immediately executory character of the
decision in Civil Case No. 04-1049.

Stronghold Insurance Company, Inc. vs. Tomas Cuenca, Marcelina Cuenca et al

G.R. No. 173297, March 6, 2013
BERSAMIN, J.:
The personality of a corporation is distinct and separate from the personalities of its stockholders. Hence, its
stockholders are not themselves the real parties in interest to claim and recover compensation for the damages
arising from the wrongful attachment of its assets. Only the corporation is the real party in interest for that
purpose.

FACTS:
Maraon filed a complaint in the RTC against the Cuencas for the collection of a sum of money and damages.
His complaint included an application for the issuance of a writ of preliminary attachment. the RTC granted the
application for the issuance of the writ of preliminary attachment conditioned upon the posting of a bond of
P1,000,000.00 executed in favor of the Cuencas. Less than a month later, Maraon amended the complaint to
implead Tayactac as a defendant. Maraon posted SICI Bond No. 68427 JCL (4) No. 02370 in the amount of
P1,000,000.00 issued by Stronghold Insurance. Two days later, the RTC issued the writ of preliminary
attachment. The sheriff served the writ, the summons and a copy of the complaint on the Cuencas on the same
day. Enforcing the writ of preliminary attachment, the sheriff levied upon the equipment, supplies, materials
and various other personal property belonging to Arc Cuisine, Inc. that were found in the leased corporate
office-cum-commissary or kitchen of the corporation. RTC denied the Motion to Dismiss and to Quash Writ of
Preliminary Attachment, stating that the action, being one for the recovery of a sum of money and damages,
was within its jurisdiction. CA remanded to the RTC for hearing and resolution of the Cuencas and Tayactacs
claim for the damages sustained from the enforcement of the writ of preliminary attachment. Cuencas and
Tayactac filed a Motion to Require Sheriff to Deliver Attached Properties and to Set Case for Hearing. RTC
commanded Maraon to surrender all the attached properties to the RTC through the sheriff within 10 days
from notice. RTC rendered its judgment on April 28, 2003, holding Maraon and Stronghold Insurance jointly
and solidarily liable for damages to the Cuencas and Tayactac

ISSUE: Whether or not the respondents are real parties in interest

RULING: No
To ensure the observance of the mandate of the Constitution, Section 2, Rule 3 of the Rules of Court requires
that unless otherwise authorized by law or the Rules of Court every action must be prosecuted or defended in
the name of the real party in interest. Under the same rule, a real party in interest is one who stands to be
benefited or injured by the judgment in the suit, or one who is entitled to the avails of the suit. Accordingly, a
person , to be a real party in interest in whose name an action must be prosecuted, should appear to be the
present real owner of the right sought to be enforced, that is, his interest must be a present substantial interest,
not a mere expectancy, or a future, contingent, subordinate, or consequential interest. Where the plaintiff is not
the real party in interest, the ground for the motion to dismiss is lack of cause of action. The reason for this is
that the courts ought not to pass upon questions not derived from any actual controversy. Truly, a person
having no material interest to protect cannot invoke the jurisdiction of the court as the plaintiff in an action. Nor
does a court acquire jurisdiction over a case where the real party in interest is not present or impleaded.
The purposes of the requirement for the real party in interest prosecuting or defending an action at law are: (a)
to prevent the prosecution of actions by persons without any right, title or interest in the case; (b) to require that
the actual party entitled to legal relief be the one to prosecute the action; (c) to avoid a multiplicity of suits; and
(d) to discourage litigation and keep it within certain bounds, pursuant to sound public policy. Indeed,
considering that all civil actions must be based on a cause of action, defined as the act or omission by which a
party violates the right of another, the former as the defendant must be allowed to insist upon being opposed by
the real party in interest so that he is protected from further suits regarding the same claim. Under this rationale,
the requirement benefits the defendant because the defendant can insist upon a plaintiff who will afford him a
setup providing good res judicata protection if the struggle is carried through on the merits to the end.
The rule on real party in interest ensures, therefore, that the party with the legal right to sue brings the action,
and this interest ends when a judgment involving the nominal plaintiff will protect the defendant from a
subsequent identical action. Such a rule is intended to bring before the court the party rightfully interested in
the litigation so that only real controversies will be presented and the judgment, when entered, will be binding
and conclusive and the defendant will be saved from further harassment and vexation at the hands of other
claimants to the same demand.
There is no dispute that the properties subject to the levy on attachment belonged to Arc Cuisine, Inc. alone, not
to the Cuencas and Tayactac in their own right. They were only stockholders of Arc Cuisine, Inc., which had a
personality distinct and separate from that of any or all of them. The damages occasioned to the properties by
the levy on attachment, wrongful or not, prejudiced Arc Cuisine, Inc., not them. As such, only Arc Cuisine, Inc.
had the right under the substantive law to claim and recover such damages. This right could not also be asserted
by the Cuencas and Tayactac unless they did so in the name of the corporation itself. But that did not happen
herein, because Arc Cuisine, Inc. was not even joined in the action either as an original party or as an
intervenor.
The Cuencas and Tayactac were clearly not vested with any direct interest in the personal properties coming
under the levy on attachment by virtue alone of their being stockholders in Arc Cuisine, Inc. Their
stockholdings represented only their proportionate or aliquot interest in the properties of the corporation, but
did not vest in them any legal right or title to any specific properties of the corporation. Without doubt, Arc
Cuisine, Inc. remained the owner as a distinct legal person.
Given the separate and distinct legal personality of Arc Cuisine, Inc., the Cuencas and Tayactac lacked the legal
personality to claim the damages sustained from the levy of the formers properties. According to Asset
Privatization Trust v. Court of Appeals, even when the foreclosure on the assets of the corporation was
wrongful and done in bad faith the stockholders had no standing to recover for themselves moral damages;
otherwise, they would be appropriating and distributing part of the corporations assets prior to the dissolution
of the corporation and the liquidation of its debts and liabilities.

Metropolitan Bank and Trust Company vs. Hon. Edilberto Sandoval

G. R. No. 169677, February 18, 2013
BERSAMIN, J.:
The court, in furtherance of convenience or to avoid prejudice, may order a separate trial of any claim, cross-
claim, counterclaim, or third-party complaint, or of any separate issue or of any number of claims, cross-
claims, counterclaims, third-party complaints or issues. But a separate trial may be denied if a party is thereby
deprived of his right to be heard upon an issue dealt with and determined in the main trial.
FACTS:
The Republic brought a complaint for reversion, reconveyance, restitution, accounting and damages in the
Sandiganbayan against Andres V. Genito, Jr., Ferdinand E. Marcos, Imelda R. Marcos and other defendants.
The action was obviously to recover allegedly ill-gotten wealth of the Marcoses, their nominees, dummies and
agents. Among the properties subject of the action were two parcels of commercial land located in Tandang
Sora, Quezon City, covered by TCT No. 2664234 and TCT No. 2665885 of the Registry of Deeds of Quezon
City registered in the names of Spouses Andres V. Genito, Jr. and Ludivina L. Genito. Republic moved for the
amendment of the complaint in order to implead Asian Bank as an additional defendant. The Sandiganbayan
granted the motion. It appears that Asian Bank claimed ownership of the two parcels of land as the registered
owner. Asian Bank was also in possession of the properties by virtue of the writ of possession issued by the
RTC in Quezon City. When the Republic was about to terminate its presentation of evidence against the
original defendants, it moved to hold a separate trial against Asian Bank. Commenting on the motion, Asian
Bank sought the deferment of any action on the motion until it was first given the opportunity to test and assail
the testimonial and documentary evidence the Republic had already presented against the original defendants,
and contended that it would be deprived of its day in court if a separate trial were to be held against it. Republic
maintained that a separate trial for Asian Bank was proper because its cause of action against Asian Bank was
entirely distinct and independent from its cause of action against the original defendants.

ISSUE: Whether or not Sandiganbayan erred in ruling that the Republic was entitled to a separate trial against
Asian Bank

RULING: Yes
The text of Section 2, Rule 31 of the Rules of Court grants to the trial court the discretion to determine if a
separate trial of any claim, cross-claim, counterclaim, or third-party complaint, or of any separate issue or of
any number of claims, cross-claims, counterclaims, third-party complaints or issues should be held, provided
that the exercise of such discretion is in furtherance of convenience or to avoid prejudice to any party.
Sandiganbayan committed grave abuse of its discretion in ordering a separate trial as to Asian Bank
(Metrobank) on the ground that the issue against Asian Bank was distinct and separate from that against the
original defendants. Thereby, the Sandiganbayan veered away from the general rule of having all the issues in
every case tried at one time, unreasonably shunting aside the dictum in Corrigan case that a single trial will
generally lessen the delay, expense, and inconvenience to the parties and the courts.
Exceptions to the general rule are permitted only when there are extraordinary grounds for conducting separate
trials on different issues raised in the same case, or when separate trials of the issues will avoid prejudice, or
when separate trials of the issues will further convenience, or when separate trials of the issues will promote
justice, or when separate trials of the issues will give a fair trial to all parties. Otherwise, the general rule must
apply. However, the justification of the Sandiganbayan for allowing the separate trial did not constitute a
special or compelling reason like any of the exceptions. To begin with, the issue relevant to Asian Bank was
not complicated. In that context, the separate trial would not be in furtherance of convenience. And, secondly,
the cause of action against Asian Bank was necessarily connected with the cause of action against the original
defendants. Should the Sandiganbayan resolve the issue against Spouses Genito in a separate trial on the basis
of the evidence adduced against the original defendants, the properties would be thereby adjudged as ill-gotten
and liable to forfeiture in favor of the Republic without Metrobank being given the opportunity to rebut or
explain its side. The outcome would surely be prejudicial towards Metrobank. Only a joint trial with the
original defendants could afford to Metrobank the equal and efficient opportunity to confront and to contest all
the evidence bearing on its ownership of the properties. Hence, the disadvantages that a separate trial would
cause to Metrobank would far outweigh any good or benefit that the Republic would seemingly stand to gain
from the separation of trials.

Allen Macasaet et al vs. Francisco Co, Jr.

G.R. No. 156759, June 5, 2013
BERSAMIN, J.:
To warrant the substituted service of the summons and copy of the complaint, the serving officer must first
attempt to effect the same upon the defendant in person. Only after the attempt at personal service has become
futile or impossible within a reasonable time may the officer resort to substituted service.
FACTS:
Respondent, a retired police officer assigned at the Western Police District in Manila, sued AbanteTonite, a
daily tabloid of general circulation; its Publisher Allen A. Macasaet; its Managing Director Nicolas V. Quijano;
ts Circulation Manager Isaias Albano; its Editors Janet Bay, Jesus R. Galang and Randy Hagos; and its
Columnist/Reporter Lily Reyes (petitioners), claiming damages because of an allegedly libelous article
petitioners published in the June 6, 2000 issue of AbanteTonite. The suit was raffled to Branch 51 of the RTC,
which in due course issued summons to be served on each defendant, including AbanteTonite, at their business
address. RTC Sheriff Raul Medina proceeded to the stated address to effect the personal service of the
summons on the defendants. But his efforts to personally serve each defendant in the address were futile
because the defendants were then out of the office and unavailable. He returned in the afternoon of that day to
make a second attempt at serving the summons, but he was informed that petitioners were still out of the office.
He decided to resort to substituted service of the summons, and explained why in his sheriffs return.
Petitioners moved for the dismissal of the complaint through counsels special appearance in their behalf,
alleging lack of jurisdiction over their persons because of the invalid and ineffectual substituted service of
summons. They contended that the sheriff had made no prior attempt to serve the summons personally on each
of them in accordance with Section 6 and Section 7, Rule 14 of the Rules of Court. They further moved to drop
AbanteTonite as a defendant by virtue of its being neither a natural nor a juridical person that could be
impleaded as a party in a civil action.

ISSUE: Whether or not the summons was properly served

RULING: Yes
Jurisdiction over the person, or jurisdiction in personam the power of the court to render a personal judgment
or to subject the parties in a particular action to the judgment and other rulings rendered in the action is an
element of due process that is essential in all actions, civil as well as criminal, except in actions in rem or quasi
in rem. Jurisdiction over the defendant in an action in rem or quasi in rem is not required, and the court acquires
jurisdiction over an action as long as it acquires jurisdiction over the res that is the subject matter of the action.
The purpose of summons in such action is not the acquisition of jurisdiction over the defendant but mainly to
satisfy the constitutional requirement of due process. The distinctions need to be perceived between an action in
personam, on the one hand, and an action in rem or quasi in rem, on the other hand.
As a rule, Philippine courts cannot try any case against a defendant who does not reside and is not found in the
Philippines because of the impossibility of acquiring jurisdiction over his person unless he voluntarily appears
in court; but when the case is an actionin rem or quasi in rem enumerated in Section 15, Rule 14 of the Rules of
Court, Philippine courts have jurisdiction to hear and decide the case because they have jurisdiction over the
res, and jurisdiction over the person of the non-resident defendant is not essential.In the latter instance,
extraterritorial service of summons can be made upon the defendant, and such extraterritorial service of
summons is not for the purpose of vesting the court with jurisdiction, but for the purpose of complying with the
requirements of fair play or due process, so that the defendant will be informed of the pendency of the action
against him and the possibility that property in the Philippines belonging to him or in which he has an interest
may be subjected to a judgment in favor of the plaintiff, and he can thereby take steps to protect his interest if
he is so minded. On the other hand, when the defendant in an action in personam does not reside and is not
found in the Philippines, our courts cannot try the case against him because of the impossibility of acquiring
jurisdiction over his person unless he voluntarily appears in court.
As the initiating party, the plaintiff in a civil action voluntarily submits himself to the jurisdiction of the court
by the act of filing the initiatory pleading. As to the defendant, the court acquires jurisdiction over his person
either by the proper service of the summons, or by a voluntary appearance in the action. Upon the filing of the
complaint and the payment of the requisite legal fees, the clerk of court forthwith issues the corresponding
summons to the defendant. The summons is directed to the defendant and signed by the clerk of court under
seal. It contains the name of the court and the names of the parties to the action; a direction that the defendant
answers within the time fixed by the Rules of Court; and a notice that unless the defendant so answers, the
plaintiff will take judgment by default and may be granted the relief applied for. To be attached to the original
copy of the summons and all copies thereof is a copy of the complaint (and its attachments, if any) and the
order, if any, for the appointment of a guardian ad litem.
The significance of the proper service of the summons on the defendant in an action in personam cannot be
overemphasized. The service of the summons fulfills two fundamental objectives, namely: (a) to vest in the
court jurisdiction over the person of the defendant; and(b) to afford to the defendant the opportunity to be heard
on the claim brought against him. As to the former, when jurisdiction in personam is not acquired in a civil
action through the proper service of the summons or upon a valid waiver of such proper service, the ensuing
trial and judgment are void. If the defendant knowingly does an act inconsistent with the right to object to the
lack of personal jurisdiction as to him, like voluntarily appearing in the action, he is deemed to have submitted
himself to the jurisdiction of the court. As to the latter, the essence of due process lies in the reasonable
opportunity to be heard and to submit any evidence the defendant may have in support of his defense. With the
proper service of the summons being intended to afford to him the opportunity to be heard on the claim against
him, he may also waive the process. In other words, compliance with the rules regarding the service of the
summons is as much an issue of due process as it is of jurisdiction.
Under the Rules of Court, the service of the summons should firstly be effected on the defendant himself
whenever practicable. Such personal service consists either in handing a copy of the summons to the defendant
in person, or, if the defendant refuses to receive and sign for it, in tendering it to him.The rule on personal
service is to be rigidly enforced in order to ensure the realization of the two fundamental objectives earlier
mentioned. If, for justifiable reasons, the defendant cannot be served in person within a reasonable time, the
service of the summons may then be effected either (a) by leaving a copy of the summons at his residence with
some person of suitable age and discretion then residing therein, or (b) by leaving the copy at his office or
regular place of business with some competent person in charge thereof. The latter mode of service is known as
substituted service because the service of the summons on the defendant is made through his substitute.
It is no longer debatable that the statutory requirements of substituted service must be followed strictly,
faithfully and fully, and any substituted service other than that authorized by statute is considered ineffective.
This is because substituted service, being in derogation of the usual method of service, is extraordinary in
character and may be used only as prescribed and in the circumstances authorized by statute. Only when the
defendant cannot be served personally within a reasonable time may substituted service be resorted to. Hence,
the impossibility of prompt personal service should be shown by stating the efforts made to find the defendant
himself and the fact that such efforts failed, which statement should be found in the proof of service or sheriffs
return. Nonetheless, the requisite showing of the impossibility of prompt personal service as basis for resorting
to substituted service may be waived by the defendant either expressly or impliedly.
There is no question that Sheriff Medina twice attempted to serve the summons upon each of petitioners in
person at their office address, the first in the morning of September 18, 2000 and the second in the afternoon of
the same date. Each attempt failed because Macasaet and Quijano were always out and not available and the
other petitioners were always roving outside and gathering news. The circumstances fully warranted his
conclusion. He was not expected or required as the serving officer to effect personal service by all means and at
all times, considering that he was expressly authorized to resort to substituted service should he be unable to
effect the personal service within a reasonable time. In that regard, what was a reasonable time was dependent
on the circumstances obtaining. While we are strict in insisting on personal service on the defendant, we do not
cling to such strictness should the circumstances already justify substituted service instead. It is the spirit of the
procedural rules, not their letter, that governs. In reality, petitioners insistence on personal service by the
serving officer was demonstrably superfluous. They had actually received the summonses served through their
substitutes, as borne out by their filing of several pleadings in the RTC, including an answer with compulsory
counterclaim ad cautelam and a pre-trial brief ad cautelam.

Heirs of Marcelo Sotto vs. Matilde Palicte

G.R. No. 159691, June 13, 2013
BERSAMIN, J.:
Res judicata exists when as between the action sought to be dismissed and the other action these elements are
present, namely; (1) the former judgment must be final; (2) the former judgment must have been rendered by a
court having jurisdiction of the subject matter and the parties; (3) the former judgment must be a judgment on
the merits; and (4) there must be between the first and subsequent actions (i) identity of parties or at least such
as representing the same interest in both actions; (ii) identity of subject matter, or of the rights asserted and
relief prayed for, the relief being founded on the same facts; and, (iii) identity of causes of action in both
actions such that any judgment that may be rendered in the other action will, regardless of which party is
successful, amount to res judicata in the action under consideration.
FACTS:
Filemon had four children, namely: Marcelo Sotto (Marcelo), Pascuala Sotto-Pahang (Pascuala), Miguel
Barcelona (Miguel), and Matilde. In June 1967, Pilar Teves (Pilar) and other heirs of Carmen Rallos (Carmen),
the deceased wife of Filemon, filed in the Court of First Instance (CFI) of Cebu City a complaint against the
Estate of Sotto (Civil Case No. R-10027) seeking to recover certain properties that Filemon had inherited from
Carmen, and damages. The CFI rendered judgment awarding to Pilar and other heirs of Carmen damages of
P233,963.65, among other reliefs. To satisfy the monetary part of the judgment, levy on execution was
effected against six parcels of land and two residential houses belonging to the Estate of Sotto. The levied
assets were sold at a public auction. Later on, Matilde redeemed four of the parcels of land in her own name
(i.e., Lots No. 1049, No. 1051, No. 1052 and No. 2179-C), while her sister Pascuala redeemed one of the two
houses because her family was residing there. On July 9, 1980, the Deputy Provincial Sheriff of Cebu executed
a deed of redemption in favor of Matilde, which the Clerk of Court approved.
Matilde filed in Civil Case No. R-10027 a motion to transfer to her name the title to the four properties.
However, the CFI denied her motion, and instead declared the deed of redemption issued in her favor null and
void, holding that Matilde, although declared in Special Proceedings No. 2706-R as one of the heirs of
Filemon, did not qualify as a successor-in-interest with the right to redeem the four properties. Matilde directly
appealed the adverse ruling to the Court via petition for review, and on September 21, 1987, the Court,
reversing the CFIs ruling, granted Matildes petition for review but allowed her co-heirs the opportunity to join
Matilde as co-redemptioners for a period of six months before the probate court (i.e., RTC of Cebu City,
Branch 16) would grant her motion to transfer the title to her name. On September 10, 1999, the heirs of
Marcelo, specifically: Lolibeth Sotto Noble, Danilo C. Sotto, Cristina C. Sotto, Emmanuel C. Sotto, Filemon C.
Sotto, and Marcela C. Sotto; and the heirs of Miguel, namely: Alberto, Arturo and Salvacion, all surnamed
Barcelona (herein petitioners), instituted the present action for partition against Matilde in the RTC of Cebu
City, Branch 20 (Civil Case No. CEB-24293). the Estate of Sotto, through the administrator, moved in the
probate court (Special Proceedings No. 2706-R) to require Matilde to account for and turn over the four
properties that allegedly belonged to the estate, presenting documentary evidence showing that Matilde had
effected the redemption of the four properties with the funds of the estate in accordance with the express
authorization of Marcelo. The probate court granted the motion, but subsequently reversed itself upon
Matildes motion for reconsideration.

ISSUE: Whether or not the judgment was barred by res judicata

RULING: Yes
For this the fifth case to reach us, we still rule that res judicata was applicable to bar petitioners action for
partition of the four properties. Res judicata exists when as between the action sought to be dismissed and the
other action these elements are present, namely; (1) the former judgment must be final; (2) the former judgment
must have been rendered by a court having jurisdiction of the subject matter and the parties; (3) the former
judgment must be a judgment on the merits; and (4) there must be between the first and subsequent actions (i)
identity of parties or at least such as representing the same interest in both actions; (ii) identity of subject
matter, or of the rights asserted and relief prayed for, the relief being founded on the same facts; and, (iii)
identity of causes of action in both actions such that any judgment that may be rendered in the other action will,
regardless of which party is successful, amount to res judicata in the action under consideration.
The first three elements were present. The decision of the Court in G.R. No. 55076 (the first case), the decision
of the Court in G.R. No. 131722 (the second case), the order dated October 5, 1989 of the RTC in Civil Case
No. R-10027 as upheld by the Court in G.R. No. 154585 (the third case), and the decision in G.R. No. 158642
(the fourth case) all of which dealt with Matildes right to the four properties had upheld Matildes right to
the four properties and had all become final. Such rulings were rendered in the exercise of the respective
courts jurisdiction over the subject matter, and were adjudications on the merits of the cases. Civil Case No.
CEB-24293 was no different from the previous cases as far as parties, subject matter, causes of action and
issues were concerned. In other words, Civil Case No. CEB-24293 was an undisguised relitigation of the same
settled matter concerning Matildes ownership of the four properties. In all the five cases (Civil Case No. CEB-
24293 included), an identity of parties existed because the parties were the same, or there was privity among
them, or some of the parties were successors-in-interest litigating for the same thing and under the same title
and in the same capacity. The subject matter of all the actions (Civil Case No. CEB24293 included), was the
same, that is, Matildes right to the four properties.

Simplicia Abrigo and Demetrio Abrigo vs. Jimmy Flores et al

G.R. No. 160786, June 17, 2013
BERSAMIN, J.:
Once a judgment becomes immutable and unalterable by virtue of its finality, its execution should follow as a
matter of course. A supervening event, to be sufficient to stay or stop the execution, must alter or modify the
situation of the parties under the decision as to render the execution inequitable, impossible, or unfair. The
supervening event cannot rest on unproved or uncertain facts.
FACTS:
Involved in the suit is a lot with an area of 402 square meters situated in the Municipality of Alaminos, Laguna
and inherited by both Francisco (Faylona) and Gaudencia (Faylona) from their deceased parents. The lot is
declared for taxation purposes under Tax Declaration No. 7378 which Gaudencia managed to secure in her
name alone to the exclusion of Francisco and the latters widow and children. It appears that after Franciscos
death, his widow and Gaudencia entered into an extrajudicial partition whereby the western half of the same lot
was assigned to Franciscos heirs while the eastern half thereof to Gaudencia. There was, however, no actual
ground partition of the lot up to and after Gaudencias death. It thus result that both the heirs of Francisco and
Gaudencia owned in common the land in dispute, which co-ownership was recognized by Gaudencia herself
during her lifetime, whose heirs, being in actual possession of the entire area, encroached and built
improvements on portions of the western half. In the case of the petitioners, a small portion of their residence,
their garage and poultry pens extended to the western half.
Such was the state of things when, on July 22 1988, in the Regional Trial Court at San Pablo City, the heirs and
successors-in-interest of Francisco Faylona, among whom are the private respondents, desiring to terminate
their co-ownership with the heirs of Gaudencia, filed their complaint for judicial partition in this case, which
complaint was docketed a quo as Civil Case No. SP-3048.
In a decision dated November 20, 1989, the trial court rendered judgment for the private respondents by
ordering the partition of the land in dispute in such a way that the western half thereof shall pertain to the heirs
of Francisco while the eastern half, to the heirs of Gaudencia whose heirs were further required to pay rentals to
the plaintiffs for their use and occupancy of portions on the western half. With no further appellate proceedings
having been taken by the petitioners and their other co-heirs, an Entry of Judgment was issued by this Court on
June 3, 1996.

ISSUE: Whether or not the sale by respondent Jimmy Flores of his 1/4 share in the western portion of the 402-
square meter lot constituted a supervening event that rendered the execution of the final judgment against
petitioners inequitable.

RULING: No
Although it is true that there are recognized exceptions to the execution as a matter of right of a final and
immutable judgment, one of which is a supervening event, such circumstance did not obtain herein. To accept
their contention would be to reopen the final and immutable judgment in order to further partition the western
portion thereby adjudicated to the heirs and successors-in-interest of Francisco Faylona for the purpose of
segregating the portion supposedly subject of the sale by Jimmy Flores. The reopening would be legally
impermissible, considering that the November 20, 1989 decision, as modified by the CA, could no longer be
altered, amended or modified, even if the alteration, amendment or modification was meant to correct what was
perceived to be an erroneous conclusion of fact or of law and regardless of what court, be it the highest Court
of the land, rendered it.8 This is pursuant to the doctrine of immutability of a final judgment, which may be
relaxed only to serve the ends of substantial justice in order to consider certain circumstances like: (a) matters
of life, liberty, honor or property; (b) the existence of special or compelling circumstances; (c) the merits of the
case; (d) the cause not being entirely attributable to the fault or negligence of the party favored by the
suspension of the doctrine; (e) the lack of any showing that the review sought is merely frivolous and dilatory;
or (f) the other party will not be unjustly prejudiced by the suspension.9
Verily, petitioners could not import into the action for partition of the property in litis their demand for the
segregration of the share of Jimmy Flores. Instead, their correct course of action was to initiate in the proper
court a proceeding for partition of the western portion based on the supposed sale to them by Jimmy Flores.
We deem it highly relevant to point out that a supervening event is an exception to the execution as a matter of
right of a final and immutable judgment rule, only if it directly affects the matter already litigated and settled,
or substantially changes the rights or relations of the parties therein as to render the execution unjust,
impossible or inequitable.10 A supervening event consists of facts that transpire after the judgment became
final and executory, or of new circumstances that develop after the judgment attained finality, including matters
that the parties were not aware of prior to or during the trial because such matters were not yet in existence at
that time.11 In that event, the interested party may properly seek the stay of execution or the quashal of the
writ of execution,12 or he may move the court to modify or alter the judgment in order to harmonize it with
justice and the supervening event.13 The party who alleges a supervening event to stay the execution should
necessarily establish the facts by competent evidence; otherwise, it would become all too easy to frustrate the
conclusive effects of a final and immutable judgment. Here, however, the sale by Jimmy Flores of his supposed
share in the western portion of the property in litis, assuming it to be true, did not modify or alter the
judgment regarding the partition of the property in litis.

Segundina Galvez vs. Court of Appeals

G.R. No. 157445, April 3, 2013
BERSAMIN, J.:
The mere failure to attach copies of pleadings and other material portions of the record as would support the
allegations should not cause. The outright dismissal of a petition for review. The allegations of the petition
must be examined to determine the sufficiency of the attachments appended thereto.
FACTS:
The case involves a parcel of land (property) located in Barangay District II, Babatngon, Leyte, which used to
be owned by Spouses Eustacio and Segundina Galvez. After their marital relationship turned sour, Eustacio and
Segundina separated and cohabited with other partners. On January 6, 1981, Eustacio sold the property to their
daughter Jovita without the knowledge or consent of Segundina. After the sale, Jovita constituted a mortgage
on the property on March 9, 1981 to secure her loan from the Philippine National Bank (PNB). Jovita failed to
pay her obligation. Hence, PNB had the property extrajudicially foreclosed. In the ensuing foreclosure sale,
PNB was the highest bidder. There being no redemption, the property became PNBs acquired asset. On June
10, 1992, respondents Spouses Honorio and Susana Montao purchased the property from PNB. Thereafter, the
Montaos tried to get the actual possession of the property, but Segundina refused to vacate. Accordingly, the
Montaos sued Segundina for recovery of ownership and possession, and damages in the Municipal Trial Court
of Babatngon, Leyte (MTC). Segundina countered that the sale of the property by Eustacio to Jovita was null
and void for having been done without her knowledge and consent; that the sale to PNB as well as to the
Montaos were consequently void; and that the Montaos were also buyers in bad faith. MTC ruled in favor of
the Montaos, holding that the sale by Eustacio to Jovita was merely voidable, not null and void; that because
Segundina had not brought an action for the annulment of the sale within 10 years from the date of the
transaction, as provided in Article 173 of the Civil Code, the sale remained valid; that Segundina did not
establish that the foreclosure proceedings, auction sale, and the acquisition of the property by the Montaos
were void; and that in view of the valid acquisition of the property by PNB during the foreclosure sale, the
subsequent sale to the Montaos was also valid. Segundina appealed to the CA by petition for review, which
was dismissed. CA ruled that Aacursory perusal of the instant petition for review shows that no copies of
pleadings and other material portions of the record as would support the allegations thereof were attached as
annexes in violation of Section 2, Rule 42 of the 1997 Rules of Civil Procedure.

ISSUE: Whether or not CA erred in dismissing the complaint

RULING: Yes
The dismissal of Segundinas petition for review upon the ground stated in the assailed resolutions was based
on Section 3, Rule 42 of the 1997 Rules of Civil Procedure. It is settled that the petitioners failure to append
the pleadings and pertinent documents to the petition can be rectified by the subsequent filing of a motion for
reconsideration to which is attached the omitted pleadings and documents as required by the CA. The foregoing
rulings show that the mere failure to attach copies of the pleadings and other material portions of the record as
would support the allegations of the petition for review is not necessarily fatal as to warrant the outright denial
of due course when the clearly legible duplicate originals or true copies of the judgments or final orders of both
lower courts, certified correct by the clerk of court of the RTC, and other attachments of the petition
sufficiently substantiate the allegations. The Court considers the attachments of Segundinas petition for
review (i.e., the certified true copies of the MTC decision dated February 4, 2000, the RTC decision dated
November 29, 2000, and the RTC order dated April 22, 2002) already sufficient to enable the CA to pass upon
her assigned errors and to resolve her appeal even without the pleadings and other portions of the records. To
still deny due course to her petition for not attaching the complaint and the answer despite the MTC decision
having substantially summarized their contents was to ignore the spirit and purpose of the requirement to give
sufficient information to the CA.

Roberto Bordomeo, Jayme Sarmiento and Gregorio Barredo vs. Court of Appeals
G.R. No. 161596, February 20, 2013
BERSAMIN, J.:
As an extraordinary remedy, certiorari cannot replace or supplant an adequate remedy in the ordinary course
of law, like an appeal in due course. It is the inadequacy of a remedy in the ordinary course of law that
determines whether certiorari can be a proper alternative remedy.
FACTS:
IPI Employees Union-Associated Labor Union, representing the workers, had a bargaining deadlock with the
IPI management. This deadlock resulted in the Union staging a strike and IPI ordering a lockout. After
assuming jurisdiction over the dispute, DOLE Secretary Ruben D. Torres rendered a decision dismissing the
Unions complaint against the Company for unfair labor practice through refusal to bargain. Resolving the
parties ensuing respective motions for reconsideration or clarification, Secretary Torres rendered another
ruling ordering the International Pharmaceutical Inc. to reinstate to their former positions with full backwages
reckoned from 8 December 1989 until actually reinstated without loss of seniority rights and other benefits the
affected workers. IPI assailed the issuances of Secretary Torres directly in this Court through a petition for
certiorari, but the Court dismissed its petition on the ground that no grave abuse of discretion had attended the
issuance of the assailed decision.

ISSUE: Whether or not the petitioner availed of the proper remedy (2) Whether or not the employees were
entitled to separation pay

RULING: No
An appeal by petition for review on certiorari under Rule 45 of the Rules of Court, to be taken to this Court
within 15 days from notice of the judgment or final order raising only questions of law, was the proper remedy
available to the petitioners. Hence, their filing of the petition for certiorari was improper. The averment therein
that the CA gravely abused its discretion did not warrant the filing of the petition for certiorari, unless the
petition further showed how an appeal in due course under Rule 45 was not an adequate remedy for them. By
virtue of its being an extraordinary remedy, certiorari cannot replace or substitute an adequate remedy in the
ordinary course of law, like an appeal in due course. It is the adequacy of a remedy in the ordinary course of
law that determines whether a special civil action for certiorari can be a proper alternative remedy.
Even so, Rule 65 of the Rules of Court still requires the petition for certiorari to comply with the following
requisites, namely: (1) the writ of certiorari is directed against a tribunal, a board, or an officer exercising
judicial or quasi-judicial functions; (2) such tribunal, board, or officer has acted without or in excess of
jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction; and (3) there is no
appeal or any plain, speedy, and adequate remedy in the ordinary course of law.
Jurisprudence recognizes certain situations when the extraordinary remedy of certiorari may be deemed proper,
such as: (a) when it is necessary to prevent irreparable damages and injury to a party; (b) where the trial judge
capriciously and whimsically exercised his judgment; (c) where there may be danger of a failure of justice; (d)
where an appeal would be slow, inadequate, and insufficient; (e) where the issue raised is one purely of law; (f)
where public interest is involved; and (g) in case of urgency. Yet, a reading of the petition for certiorari and its
annexes reveals that the petition does not come under any of the situation.
In a special civil action for certiorari brought against a court with jurisdiction over a case, the petitioner carries
the burden to prove that the respondent tribunal committed not a merely reversible error but a grave abuse of
discretion amounting to lack or excess of jurisdiction in issuing the impugned order. Under the circumstances,
the CA committed no abuse of discretion, least of all grave, because its justifications were supported by the
history of the dispute and borne out by the applicable laws and jurisprudence.

The demand lacked legal basis. Although the decision of the DOLE Secretary dated December 5, 1991 had
required IPI to reinstate the affected workers to their former positions with full backwages reckoned from
December 8, 1989 until actually reinstated without loss of seniority rights and other benefits, the reinstatement
thus decreed was no longer possible. Hence, separation pay was instead paid to them. This alternative was
sustained in law and jurisprudence, for separation pay may avail in lieu of reinstatement if reinstatement is no
longer practical or in the best interest of the parties. Separation pay in lieu of reinstatement may likewise be
awarded if the employee decides not to be reinstated.
Under the circumstances, the employment of the 15 employees or the possibility of their reinstatement
terminated by March 15, 1995. Thereafter, their claim for separation pay and backwages beyond March 15,
1995 would be unwarranted. The computation of separation pay and backwages due to illegally dismissed
employees should not go beyond the date when they were deemed to have been actually separated from their
employment, or beyond the date when their reinstatement was rendered impossible.

Special People, Inc. Foundation vs. Nestor Canda et al

G.R. No. 160932, January 14, 2013
BERSAMIN, J.:
The peremptory writ of mandamus is an extraordinary remedy that is issued only in extreme necessity, and the
ordinary course of procedure is powerless to afford an adequate and speedy relief to one who has a clear legal
right to the performance of the act to be compelled.
FACTS:
The petitioner was a proponent of a water-resource development and utilization project in Barangay Jimilia-an
in the Municipality of Loboc, Bohol that would involve the tapping and purifying of water from the Loboc
River, and the distribution of the purified water to the residents of Loboc and six other municipalities. The
petitioner applied for a Certificate of Non-Coverage (CNC) with the Environmental Management Bureau
(EMB) of the Department of Environment and Natural Resources (DENR), Region 7, seeking to be exempt
from the requirement of the Environmental Compliance Certificate (ECC) under Section 4 of Presidential
Decree No. 1586. Upon evaluating the nature and magnitude of the environmental impact of the project,
respondent Nestor M. Canda, then Chief of EMB in Bohol, rendered his findings that Initial Environmental
Examination is required. RD Lipayon required the petitioner to submit the following documents to enable the
EMB to determine whether the project was within an environmentally critical area or not. The petitioner failed
to secure a certification from the Regional Office of the Mines and Geosciences Bureau (RO-MGB) to the
effect that the project area was not located along a fault line/fault zone or a critical slope because RO-MGB did
not have the data and expertise to render such finding. According to PHIVOLCS, the project site was
approximately 18 kilometers west of the East Bohol Fault. RD Lipayons letter declared that the project was
within an environmentally critical area, and that the petitioner was not entitled to the CNC. Petitioner filed a
petition for mandamus and damages in the Regional Trial Court (RTC) in Loay, Bohol.

ISSUE: (1) whether the appeal directly to this Court from the RTC was proper; (2) whether the petition for
mandamus was the correct recourse.

RULING:
Petitioners appeal is improper under Rule 45, Rules of Court
This appeal by certiorari is being taken under Rule 45, Rules of Court, whose Section 1 expressly requires that
the petition shall raise only questions of law which must be distinctly set forth. Yet, the petitioner hereby raises
a question of fact whose resolution is decisive in this appeal. That issue of fact concerns whether or not the
petitioner established that its project was not located in an environmentally critical area. For this reason, the
Court is constrained to deny due course to the petition for review.

Mandamus was an improper remedy for petitioner

We dismiss the present recourse because the petitioner failed to exhaust the available administrative remedies,
and because it failed to show that it was legally entitled to demand the performance of the act by the
respondents. It is axiomatic, to begin with, that a party who seeks the intervention of a court of law upon an
administrative concern should first avail himself of all the remedies afforded by administrative processes. The
issues that an administrative agency is authorized to decide should not be summarily taken away from it and
submitted to a court of law without first giving the agency the opportunity to dispose of the issues upon due
deliberation. The court of law must allow the administrative agency to carry out its functions and discharge its
responsibilities within the specialized areas of its competence. The records show that the petitioner failed to
exhaust the available administrative remedies. At the time RD Lipayon denied the petitioners application for
the CNC, Administrative Order No. 42 had just vested the authority to grant or deny applications for the ECC
in the Director and Regional Directors of the EMB. Notwithstanding the lack of a specific implementing
guideline to what office the ruling of the EMB Regional Director was to be appealed, the petitioner could have
been easily guided in that regard by the Administrative Code of 1987, which provides that the Director of a line
bureau, such as the EMB, shall have supervision and control over all division and other units, including
regional offices, under the bureau. Verily, supervision and control include the power to review, approve,
reverse or modify acts and decisions of subordinate officials or units. Accordingly, the petitioner should have
appealed the EMB Regional Directors decision to the EMB Director, who exercised supervision and control
over the former.
Another reason for denying due course to this review is that the petitioner did not establish that the grant of its
application for the CNC was a purely ministerial in nature on the part of RD Lipayon. Hence, mandamus was
not a proper remedy. The CNC is a certification issued by the EMB certifying that a project is not covered by
the Environmental Impact Statement System (EIS System) and that the project proponent is not required to
secure an ECC. P.D. No. 1586 exempted from the requirement of an EIS the projects and areas not declared by
the President of the Philippines as environmentally critical. The foregoing considerations indicate that the grant
or denial of an application for ECC/CNC is not an act that is purely ministerial in nature, but one that involves
the exercise of judgment and discretion by the EMB Director or Regional Director, who must determine
whether the project or project area is classified as critical to the environment based on the documents to be
submitted by the applicant. There is no sufficient showing that the petitioner satisfactorily complied with the
requirement to submit the needed certifications.

Sps. Augusto Dacudao and Ofelia Dacudao

G.R. No. 188056, January 8, 2013
BERSAMIN, J.:
For a special civil action for certiorari to prosper, therefore, the following requisites must concur, namely: (a)
it must be directed against a tribunal, board or officer exercising judicial or quasi-judicial functions; (b) the
tribunal, board, or officer must have acted without or in excess of jurisdiction or with grave abuse of discretion
amounting to lack or excess of jurisdiction; and (c) there is no appeal nor any plain, speedy, and adequate
remedy in the ordinary course of law. The burden of proof lies on petitioners to demonstrate that the assailed
order was issued without or in excess of jurisdiction or with grave abuse of discretion amounting to lack or
excess of jurisdiction.
FACTS:
Petitioners - residents of Bacaca Road, Davao City - were among the investors whom Celso G. Delos Angeles,
Jr. and his associates in the Legacy Group of Companies allegedly defrauded through the Legacy Group's "buy
back agreement" that earned them check payments that were dishonored. After their written demands for the
return of their investments went unheeded, they initiated a number of charges for syndicated estafa against
Delos Angeles, Jr., et al. in the Office of the City Prosecutor of Davao City. Secretary of Justice issued
Department of Justice (DOJ) Order No. 182 (DO No. 182), directing all Regional State Prosecutors, Provincial
Prosecutors, and City Prosecutors to forward all cases already filed against Delos Angeles, Jr., et al. to the
Secretariat of the DOJ Special Panel in Manila for appropriate action. Aggrieved by such turn of events,
petitioners have directly come to the Court via petition for certiorari, prohibition and mandamus, ascribing to
respondent Secretary of Justice grave abuse of discretion in issuing DO No. 182. They claim that DO No. 182
violated their right to due process, their right to the equal protection of the laws, and their right to the speedy
disposition of cases. They insist that DO No. 182 was an obstruction of justice and a violation of the rule
against enactment of laws with retroactive effect.

ISSUES: (1) Did petitioners properly bring their petition for certiorari, prohibition and mandamus directly to
the Court? (2) Did respondent Secretary of Justice commit grave abuse of discretion in issuing DO No. 182? (3)
Did DO No. 182 and DOJ Memorandum dated March 2, 2009 violate petitioners constitutionally guaranteed
rights?

RULING: (1) No (2) No (3) No

Petitioners have unduly disregarded the hierarchy of courts by coming directly to the Court with their petition
for certiorari, prohibition and mandamus without tendering therein any special, important or compelling reason
to justify the direct filing of the petition. We emphasize that the concurrence of jurisdiction among the Supreme
Court, Court of Appeals and the Regional Trial Courts to issue the writs of certiorari, prohibition, mandamus,
quo warranto, habeas corpus and injunction did not give petitioners the unrestricted freedom of choice of court
forum. An undue disregard of this policy against direct resort to the Court will cause the dismissal of the
recourse. Hence, every litigant who brings the petitions for the extraordinary writs of certiorari, prohibition and
mandamus should ever be mindful of the policy on the hierarchy of courts.

For a special civil action for certiorari to prosper, therefore, the following requisites must concur, namely: (a) it
must be directed against a tribunal, board or officer exercising judicial or quasi-judicial functions; (b) the
tribunal, board, or officer must have acted without or in excess of jurisdiction or with grave abuse of discretion
amounting to lack or excess of jurisdiction; and (c) there is no appeal nor any plain, speedy, and adequate
remedy in the ordinary course of law. The burden of proof lies on petitioners to demonstrate that the assailed
order was issued without or in excess of jurisdiction or with grave abuse of discretion amounting to lack or
excess of jurisdiction. Yet, petitioners have not shown a compliance with the requisites.
Instead, the Secretary of Justice would appear to be not exercising any judicial or quasi-judicial functions
because his questioned issuances were ostensibly intended to ensure his subordinates efficiency and economy
in the conduct of the preliminary investigation of all the cases involving the Legacy Group. The function
involved was purely executive or administrative.
There is no question that DO No. 182 enjoyed a strong presumption of its validity. In ABAKADA Guro Party
List v. Purisima, the Court has extended the presumption of validity to legislative issuances as well as to rules
and regulations issued by administrative agencies. To overcome this strong presumption of validity of the
questioned issuances, it became incumbent upon petitioners to prove their unconstitutionality and invalidity,
either by showing that the Administrative Code of 1987 did not authorize the Secretary of Justice to issue DO
No. 182, or by demonstrating that DO No. 182 exceeded the bounds of the Administrative Code of 1987 and
other pertinent laws. They did not do so.

The consolidation of the cases against Delos Angeles, Jr., et al. was ordered obviously to obtain expeditious
justice for the parties with the least cost and vexation to them. Inasmuch as the cases filed involved similar or
related questions to be dealt with during the preliminary investigation, the Secretary of Justice rightly found the
consolidation of the cases to be the most feasible means of promoting the efficient use of public resources and
of having a comprehensive investigation of the cases.
On the other hand, we do not ignore the possibility that there would be more cases reaching the DOJ in addition
to those already brought by petitioners and other parties. Yet, any delays in petitioners cases occasioned by
such other and subsequent cases should not warrant the invalidation of DO No. 182. The Constitution prohibits
only the delays that are unreasonable, arbitrary and oppressive, and tend to render rights nugatory. In fine, we
see neither undue delays, nor any violation of the right of petitioners to the speedy disposition of their cases.

Datu Ampatuan, Jr. vs. Sec. Leila de Lima

G.R. No. 197291, April 3, 2013
BERSAMIN, J.:
In matters involving the exercise of judgment and discretion, mandamus cannot be used to direct the manner or
the particular way the judgment and discretion are to be exercised. Consequently, the Secretary of Justice may
be compelled by writ of mandamus to act on a letter-request or a motion to include a person in the information,
but may not be compelled by writ of mandamus to act in a certain way, i.e., to grant or deny such letter-request
or motion.
FACTS:
History will never forget the atrocities perpetrated on November 23, 2009, when 57 innocent civilians were
massacred in Sitio Masalay, Municipality of Ampatuan, Maguindanao Province. Among the principal suspects
was petitioner, then the Mayor of the Municipality of Datu Unsay, Maguindanao Province. Inquest proceedings
were conducted against petitioner. Department of Justice (DOJ) resolved to file the corresponding informations
for murder against petitioner, and to issue subpoenae to several persons. 41 informations for murder were also
filed against petitioner. Secretary of Justice Devanadera transmitted her letter to Chief Justice Puno requesting
the transfer of the venue of the trial of the Maguindanao massacre from Cotabato City to Metro Manila, either
in Quezon City or in Manila, to prevent a miscarriage of justice. The Court granted the request for the transfer
of venue. Dalandag was admitted into the Witness Protection Program of the DOJ. QC RTC issued its amended
pre-trial order, wherein Dalandag was listed as one of the Prosecution witnesses. petitioner, through counsel,
wrote to respondent Secretary of Justice Leila De Lima and Assistant Chief State Prosecutor Richard Fadullon
to request the inclusion of Dalandag in the informations for murder considering that Dalandag had already
confessed his participation in the massacre through his two sworn declarations.

ISSUE: Whether or not the petitioner may compel the respondents through mandamus to prosecute Dalandag

RULING: No
The prosecution of crimes pertains to the Executive Department of the Government whose principal power and
responsibility are to see to it that our laws are faithfully executed.
The two modes by which a participant in the commission of a crime may become a state witness are, namely:
(a) by discharge from the criminal case pursuant to Section 17 of Rule 119 of the Rules of Court; and (b) by the
approval of his application for admission into the Witness Protection Program of the DOJ in accordance with
Republic Act No. 6981 (The Witness Protection, Security and Benefit Act).39 These modes are intended to
encourage a person who has witnessed a crime or who has knowledge of its commission to come forward and
testify in court or quasi-judicial body, or before an investigating authority, by protecting him from reprisals,
and shielding him from economic dislocation.
The admission of Dalandag into the Witness Protection Program of the Government as a state witness since
August 13, 2010 was warranted by the absolute necessity of his testimony to the successful prosecution of the
criminal charges. Apparently, all the conditions prescribed by Republic Act No. 6981 were met in his case.
That he admitted his participation in the commission of the Maguindanao massacre was no hindrance to his
admission into the Witness Protection Program as a state witness, for all that was necessary was for him to
appear not the most guilty. Accordingly, he could not anymore be charged for his participation in the
Maguindanao massacre, as to which his admission operated as an acquittal, unless he later on refuses or fails to
testify in accordance with the sworn statement that became the basis for his discharge against those now
charged for the crimes.
Mandamus shall issue when any tribunal, corporation, board, officer or person unlawfully neglects the
performance of an act that the law specifically enjoins as a duty resulting from an office, trust, or station. It is
proper when the act against which it is directed is one addressed to the discretion of the tribunal or officer. In
matters involving the exercise of judgment and discretion, mandamus may only be resorted to in order to
compel respondent tribunal, corporation, board, officer or person to take action, but it cannot be used to direct
the manner or the particular way discretion is to be exercised, or to compel the retraction or reversal of an
action already taken in the exercise of judgment or discretion.
As such, respondent Secretary of Justice may be compelled to act on the letter-request of petitioner, but may
not be compelled to act in a certain way, i.e., to grant or deny such letter-request. Considering that respondent
Secretary of Justice already denied the letter-request, mandamus was no longer available as petitioner's
recourse.

Republic of the Philippines vs. Manila Electric Company

G.R. No. 201715, December 11, 2013
BERSAMIN, J.:
The intervening rendition by the trial court of a decision on the merits of the case renders moot and academic
the resolution of any issue raised on certiorari against interlocutory orders setting the pre-trial and declaring
the petitioner to have waived its right to present its evidence. The resolution of the issue, having been pre-
empted by the decision in the main action, ceased to have any practical value.
FACTS:
MERALCO and NAPOCOR had entered into the contract for the sale of electricity (CSE) on November 21,
1994. The CSE would be effective for 10 years starting from January 1, 1995. Under the CSE, NAPOCOR was
obliged to supply and MERALCO was obliged to purchase a minimum volume of electric power and energy
from 1995 until 2004 at the rates approved by the Energy Regulatory Board (ERB), now the Energy Regulatory
Commission (ERC). A provision of the CSE required MERALCO to pay minimum monthly charges even if the
actual volume of the power and energy drawn from NAPOCOR fell below the stated minimum quantities. In
the years 2002, 2003 and 2004, due to circumstances beyond the reasonable control of the parties, MERALCO
drew from NAPOCOR electric power and energy less than the minimum quantities stipulated in the CSE for
those years. MERALCO did not pay the minimum monthly charges but only the charges for the electric power
and energy actually taken. Thus, NAPOCOR served on MERALCO a claim for the contracted but undrawn
electric power and energy starting the billing month of January 2002. MERALCO objected to the claim of
NAPOCOR, and served its notice of termination of the CSE. MERALCO submitted its own claim to
NAPOCOR for, among others: (a) losses suffered due to the delay in the construction of NAPOCORs
transmission lines, which prevented it from fully dispatching the electricity contracted with independent power
producers (IPPs) at their respective minimum energy quantities; and (b) unrealized revenues owing to
NAPOCORs continuing to supply electricity to directly-connected customers within MERALCOs franchise
area in violation of the MERALCO franchise and the CSE.
Recognizing that any delays in the resolution of their dispute was inimical to public interest, MERALCO and
NAPOCOR agreed to submit their dispute to mediation. The mediation resulted in the execution on July 15,
2003 of a settlement. The Settlement Agreement covered the charges being imposed by NAPOCOR and the
National Transmission Corporation (TRANSCO) under Section 2.1 (Contract Demand and Contract Energy of
MERALCO) in relation to Section 5.2 (Transmission Service) and Section 7 (Direct Connection within
MERALCOs franchise area), all of the CSE. MERALCO therein agreed to pay to NAPOCOR
P27,515,000,000.00 (i.e., the equivalent of 18,222 gigawatt hours valued at P1.51 per kilowatt hour), which
amount represented the value of the difference between the aggregate contracted energy for the years 2002,
2203 and 2004, on the one hand, and the total amount of energy MERALCO actually purchased from
NAPOCOR from January 2002 until April 30, 2003 and the amount of energy MERALCO was scheduled to
purchase thereafter and until December 31, 2004, on the other. NAPOCOR reciprocated by agreeing to give
credit to MERALCO for the delayed completion of the transmission facilities as well as for the energy
corresponding to NAPOCORs sales to directly-connected customers located within MERALCOs franchise
area. The credit, valued at P7,465,000,000.00, reduced the net amount payable by MERALCO to NAPOCOR
under the Settlement Agreement to P20,050,000,000.00.
on May 13, 2008, or almost two years after the case was submitted for resolution, the OSG, representing herein
petitioner, filed in the ERC a motion for leave to intervene with motion to admit its attached opposition.
Considering the opposition by the OSG to the validity of the Settlement Agreement, the ERC suspended the
proceedings and deferred the approval of the joint application. This prompted MERALCO to initiate on
November 23, 2009 in the RTC in Pasig an action for declaratory relief. On November 4, 2010, the pre-trial
was held, but the Presiding Judge of Branch 71 of the RTC ultimately reset it through the second assailed order
due to the non-appearance of the representative of the OSG.
Petitioner brought in the CA a petition for certiorari, prohibition and mandamus (C.A.-G.R. SP No. 116863),
with an application for a temporary restraining order (TRO) and writ of preliminary injunction (WPI), alleging
that respondent RTC Judge had committed grave abuse of discretion: (a) in refusing to inhibit himself; (b) in
refusing to order respondents MERALCO and NAPOCOR to resolve their dispute by arbitration; (c) in
proceeding with the pre-trial of the case; and (d) in declaring the petitioner in default and at the same time
deeming the petitioner to have waived its right to participate and present evidence

ISSUE: Whether or not the decision has been moot and academic and whether or not RTC committed grave
abuse of discretion

RULING:
RTCs intervening rendition of the decision on the merits has rendered this appeal moot
With the intervening rendition of the decision on the merits, the challenge against the interlocutory orders of
the RTC designed to prevent the RTC from proceeding with the pre-trial and the trial on the merits was
rendered moot and academic. In other words, any determination of the issue on the interlocutory orders was left
without any practical value. A case that is moot and academic because of supervening events ceases to present
any justiciable controversy. The courts of law will not determine moot and academic questions, for they should
not engage in academic declarations and determine moot questions.

CA correctly ruled that RTC Judge did not commit grave abuse of discretion in issuing the assailed
orders
The RTCs proceeding with the pre-trial set on November 24, 2010 was entirely in accord with the Rules of
Court. While it is true that the OSG had filed on November 22, 2010 the petition for certiorari, prohibition and
mandamus, the CA did not restrain the RTC from thus proceeding. Absent any TRO or WPI stopping the RTC
from proceeding, the mere filing or pendency of the special civil actions for certiorari, mandamus and
prohibition did not interrupt the due course of the proceedings in the main case. This is quite clear from the
revised Section 7, Rule 65 of the Rules of Court, which mandated that the petition shall not interrupt the course
of the principal case. For the RTC not to proceed with the pre-trial on its scheduled date of November 24, 2010
despite the absence of any TRO or WPI enjoining it from doing so could have subjected its Presiding Judge to
an administrative charge.
RTCs deeming of the petitioners right to participate in the pre-trial and its right to present evidence as waived
was reasonable under the circumstances. Thus, it did not act arbitrarily, whimsically, or capriciously. The
dismissal of the petition for certiorari, prohibition and mandamus was correct and justified, for grave abuse of
discretion on the part of the RTC was not persuasively demonstrated by the petitioner. Grave abuse of
discretion means either that the judicial or quasi-judicial power was exercised in an arbitrary or despotic
manner by reason of passion or personal hostility, or that the respondent judge, tribunal or board evaded a
positive duty, or virtually refused to perform the duty enjoined or to act in contemplation of law, such as when
such judge, tribunal or board exercising judicial or quasi-judicial powers acted in a capricious or whimsical
manner as to be equivalent to lack of jurisdiction.

Teodoro Reyes vs. Ettore Rossi

G.R. No. 159823, February 18, 2013
BERSAMIN, J.:
The rescission of a contract of sale is not a prejudicial question that will warrant the suspension of the criminal
proceedings commenced to prosecute the buyer for violations of the Bouncing Checks Law (Batas Pam bans a
Blg. 22) arising from the dishonor of the checks the buyer issued in connection with the sale.
FACTS:
Petitioner Teodoro A. Reyes (Reyes) and Advanced Foundation Construction Systems Corporation (Advanced
Foundation), represented by its Executive Project Director, respondent Ettore Rossi (Rossi), executed a deed
of conditional sale involving the purchase by Reyes of equipment consisting of a Warman Dredging Pump HY
300A worth P10,000,000.00. The parties agreed therein that Reyes would pay the sum of P3,000,000.00 as
downpayment, and the balance of P7,000,000.00 through four post-dated checks. Reyes complied, but in
January 1998, he requested the restructuring of his obligation under the deed of conditional sale by replacing
the four post-dated checks with nine post, dated checks that would include interest at the rate of
P25,000.00/month. Reyes issued and delivered the following nine post-dated checks in the aggregate sum of
P7,125,000.00 drawn against the United Coconut Planters Bank. Two of the checks were denied payment
ostensibly upon Reyes instructions to stop their payment, while the third was dishonored for insufficiency of
funds. Reyes commenced an action for rescission of contract and damages in the RTC, sought judgment
declaring the deed of conditional sale rescinded and of no further force and effect, and ordering Advanced
Foundation to return the P3,000,000.00 downpayment. Rossi charged Reyes with five counts of estafa and five
counts of violation of Batas Pambansa Blg. 22 in the Office of the City Prosecutor of Makati for the dishonor of
Checks. Reyes argued that the Office of the City Prosecutor of Makati should suspend the proceedings because
of the pendency in the RTC of the civil action for rescission of contract that posed a prejudicial question as to
the criminal proceedings.

ISSUE: Whether or not the civil action for rescission of the contract of sale raised a prejudicial question that
required the suspension of the criminal prosecution for violation of Batas Pambansa Blg. 22

RULING: No
A prejudicial question generally comes into play in a situation where a civil action and a criminal action are
both pending, and there exists in the former an issue that must first be determined before the latter may
proceed, because howsoever the issue raised in the civil action is resolved would be determinative juris et de
jure of the guilt or innocence of the accused in the criminal case. The rationale for the suspension on the ground
of a prejudicial question is to avoid conflicting decisions.
To properly appreciate if there is a prejudicial question to warrant the suspension of the criminal actions,
reference is made to the elements of the crimes charged. The violation of Batas Pambansa Blg. 22 requires the
concurrence of the following elements, namely: (1) the making, drawing, and issuance of any check to apply
for account or for value; (2) the knowledge of the maker, drawer, or issuer that at the time of issue he does not
have sufficient funds in or credit with the drawee bank for the payment of the check in full upon its
presentment; and (3) the subsequent dishonor of the check by the drawee bank for insufficiency of funds or
credit or dishonor for the same reason had not the drawer, without any valid cause, ordered the bank to stop
payment. The issue in the criminal actions upon the violations of Batas Pambansa Blg. 22 is, therefore,
whether or not Reyes issued the dishonoured checks knowing them to be without funds upon presentment. On
the other hand, the issue in the civil action for rescission is whether or not the breach in the fulfilment of
Advanced Foundations obligation warranted the rescission of the conditional sale. If, after trial on the merits in
the civil action, Advanced Foundation would be found to have committed material breach as to warrant the
rescission of the contract, such result would not necessarily mean that Reyes would be absolved of the criminal
responsibility for issuing the dishonored checks because, as the aforementioned elements show, he already
committed the violations upon the dishonor of the checks that he had issued at a time when the conditional sale
was still fully binding upon the parties. His obligation to fund the checks or to make arrangements for them
with the drawee bank should not be tied up to the future event of extinguishment of the obligation under the
contract of sale through rescission. Indeed, under Batas Pambansa Blg. 22, the mere issuance of a worthless
check was already the offense in itself. Under such circumstances, the criminal proceedings for the violation of
Batas Pambansa Blg. 22 could proceed despite the pendency of the civil action for rescission of the conditional
sale.
Civil action for the rescission of contract was not determinative of the guilt or innocence of Reyes. In this light,
it is clear that the pendency of the civil case does not bar the continuation of the proceedings in the preliminary
investigation on the ground that it poses a prejudicial question. Considering that the contracts are deemed to be
valid until rescinded, the consideration and obligatory effect thereof are also deemed to have been validly
made, thus demandable. Consequently, there was no failure of consideration at the time when the subject
checks were dishonoured.
Rafael Consing Jr. vs. People of the Philippines
G.R. No. 161075, July 15, 2013
BERSAMIN, J.:
An independent civil action based on fraud initiated by the defrauded party does not raise a prejudicial
question to stop the proceedings in a pending criminal prosecution of the defendant for estafa through
falsification. This is because the result of the independent civil action is irrelevant to the issue of guilt or
innocence of the accused.
FACTS:
Petitioner negotiated with and obtained for himself and his mother, Cecilia de la Cruz (de la Cruz) various
loans totaling P18,000,000.00 from Unicapital Inc. (Unicapital). The loans were secured by a real estate
mortgage constituted on a parcel of land (property) covered by Transfer Certificate of Title (TCT) No. T-
687599 of the Registry of Deeds for the Province of Cavite registered under the name of de la Cruz. In
accordance with its option to purchase the mortgaged property, Unicapital agreed to purchase one-half of the
property for a total consideration of P21,221,500.00. Payment was effected by off-setting the amounts due to
Unicapital under the promissory notes of de la Cruz and Consing in the amount of P18,000,000.00 and paying
an additional amount of P3,145,946.50. The other half of the property was purchased by Plus Builders, Inc.
(Plus Builders), a joint venture partner of Unicapital.
Before Unicapital and Plus Builders could develop the property, they learned that the title to the property was
really TCT No. 114708 in the names of Po Willie Yu and Juanito Tan Teng, the parties from whom the
property had been allegedly acquired by de la Cruz. TCT No. 687599 held by De la Cruz appeared to be
spurious. On its part, Unicapital demanded the return of the total amount of P41,377,851.48 as of April 19,
1999 that had been paid to and received by de la Cruz and Consing, but the latter ignored the demands. On July
22, 1999, Consing filed Civil Case No. 1759 in the Pasig City Regional Trial Court (RTC) (Pasig civil case) for
injunctive relief, thereby seeking to enjoin Unicapital from proceeding against him for the collection of the
P41,377,851.48 on the ground that he had acted as a mere agent of his mother. On the same date, Unicapital
initiated a criminal complaint for estafa through falsification of public document against Consing and de la
Cruz in the Makati City Prosecutors Office.

ISSUE: Whether or not there is a prejudicial question between the two cases

RULING:
Consing has hereby deliberately chosen to ignore the firm holding in the ruling in G.R. No. 148193 to the effect
that the proceedings in Criminal Case No. 00-120 could not be suspended because the Makati civil case was an
independent civil action, while the Pasig civil case raised no prejudicial question. That was wrong for him to do
considering that the ruling fully applied to him due to the similarity between his case with Plus Builders and his
case with Unicapital. A perusal of Unicapitals complaint in the Makati civil case reveals that the action was
predicated on fraud. This was apparent from the allegations of Unicapital in its complaint to the effect that
Consing and de la Cruz had acted in a wanton, fraudulent, oppressive, or malevolent manner in offering as
security and later object of sale, a property which they do not own, and foisting to the public a spurious title.
As such, the action was one that could proceed independently of Criminal Case No. 00-120 pursuant to Article
33 of the Civil Code.
It is well settled that a civil action based on defamation, fraud and physical injuries may be independently
instituted pursuant to Article 33 of the Civil Code, and does not operate as a prejudicial question that will
justify the suspension of a criminal case.
Contrary to Consings stance, it was not improper for the CA to apply the ruling in G.R. No. 148193 to his case
with Unicapital, for, although the Manila and Makati civil cases involved different complainants (i.e., Plus
Builders and Unicapital), the civil actions Plus Builders and Unicapital had separately instituted against him
were undeniably of similar mold, i.e., they were both based on fraud, and were thus covered by Article 33 of
the Civil Code. Clearly, the Makati criminal case could not be suspended pending the resolution of the Makati
civil case that Unicapital had filed.

Bank of the Philippine Islands vs. Hon. Judge Agaputo Hontanosas Jr,
G.R. No. 157163, June 25, 2014
BERSAMIN, J.:
Injunction should not issue except upon a clear showing that the applicant has a right in esse to be protected,
and that the acts sought to be enjoined are violative of such right. A preliminary injunction should not
determine the merits of a case, or decide controverted facts, for, being a preventive remedy, it only seeks to
prevent threatened wrong, further injury, and irreparable harm or injustice until the rights of the parties can
be settled.
FACTS:
Respondents commenced Civil Case No. CEB-26468 against petitioner alleging that the respondents
had obtained a loan from the petitioner, and had executed promissory notes binding themselves, jointly and
severally, to pay the sum borrowed; that as security for the payment of the loan, they had constituted real estate
mortgages on several parcels of land in favor of the petitioner; and that they had been made to sign a continuing
surety agreement and a chattel mortgage on their Mitsubishi Pajero.
The respondents obligation to the petitioner had reached P17,983,191.49, but they had only been able
to pay P13 Million because they had been adversely affected by the economic turmoil in Asia in 1997. The
petitioner required them to issue postdated checks to cover the loan under threat of foreclosing on the
mortgages. Thus, the complaint sought a TRO or a writ of preliminary injunction to stay the threatened
foreclosure.
On June 6, 2001, the petitioner filed its answer with affirmative defenses and counterclaim, as well as
its opposition to the issuance of the writ of preliminary injunction. Also on June 6, 2001 the petitioner filed
a motion to dismiss reiterating its affirmative defenses.
The RTC denied the petitioners motion to dismiss for being unmeritorious, but granted the
respondents application for preliminary injunction. Dissatisfied, the petitioner assailed the orders of the RTC
by petition for certiorari in the CA. The CA rendered the adverse decision under review affirming the decision
rendered by the RTC. Hence, this appeal.

ISSUES:
1. Whether or not Civil Case No. CEB-26468 should be dismissed for improper venue.
2. Whether or not the issuance of the writ of preliminary injunction against the petitioner, its agents and
representatives, was in order.

RULING:
Civil Case No. CEB-26468 was a personal action; hence, venue was properly laid
The CA and the RTC held that Civil Case No. CEB-26468, being for the declaration of the nullity of a
contract of loan and its accompanying continuing surety agreement, and the real estate and chattel mortgages,
was a personal action; hence, its filing in Cebu City, the place of business of one of the plaintiffs, was correct
under Section 2, Rule 4 of the Rules of Court. We sustain the lower courts holdings.
According to Section 1, Rule 4 of the Rules of Court, a real action is one that affects title to or
possession of real property, or an interest therein. Such action is to be commenced and tried in the proper court
having jurisdiction over the area wherein the real property involved, or a portion thereof, is situated, which
explains why the action is also referred to as a local action. In contrast, the Rules of Court declares all other
actions as personal actions. The venue of a personal action is the place where the plaintiff or any of the
principal plaintiffs resides, or where the defendant or any of the principal defendants resides, or in the case of a
non-resident defendant where he may be found, at the election of the plaintiff, for which reason the action is
considered a transitory one.
Based on the aforequoted allegations of the complaint, the respondents seek the nullification of the
promissory notes, continuing surety agreement, checks and mortgage agreements for being executed against
their will and vitiated by irregularities, not the recovery of the possession or title to the properties burdened by
the mortgages. There was no allegation that the possession of the properties under the mortgages had already
been transferred to the petitioner in the meantime. Applying the determinants, Civil Case No. CEB-26468 was
unquestionably a personal action. Being a personal action, therefore, Civil Case was properly brought in the
RTC in Cebu City, where respondent XM Facultad and Development Corporation, a principal plaintiff, had its
address. Upon the same consideration, the petitioners contention that the filing and docket fees for
the complaint should be based on the assessed values of the mortgaged real properties due to Civil Case No.
CEB-26468 being a real action cannot be upheld for lack of factual and legal bases.

Respondents were not entitled to the writ of preliminary injunction

 Injunction should not issue except upon a clear showing that the applicant has a right in esse to be
protected, and that the acts sought to be enjoined are violative of such right. A preliminary injunction should
not determine the merits of a case, or decide controverted facts, for, being a preventive remedy, it only
seeks to prevent threatened wrong, further injury, and irreparable harm or injustice until the rights of the
parties can be settled.
As mentioned, the RTC issued the writ of preliminary injunction on July 16, 2001 based on the foregoing
allegations of the respondents application, and the CA upheld the issuance in its assailed July 9, 2002 decision.
The petitioner submits that the issuance of the writ of preliminary injunction constituted a violation of
Administrative Circular (AC) No. 07-99 dated June 25, 1999. AC No. 07-99 was issued as a guideline for
lower court judges in the issuance of TROs and writs of preliminary injunctions to prevent the implementation
of infrastructure projects, or the seizure and forfeiture proceedings by the Bureau of Customs. AC No. 07-99
was irrelevant herein, however, because Civil Case No. CEB-26468 did not involve the implementation of
infrastructure projects, or the seizure and forfeiture proceedings by the Bureau of Customs. Consequently, the
petitioners urging that respondent Judge be held administratively liable for violating AC No. 07-99 was
misplaced.
However, the RTCs issuance of the writ of preliminary injunction to enjoin the petitioner from
proceeding with the foreclosure of the mortgages was plainly erroneous and unwarranted.
A preliminary injunction is an order granted at any stage of an action prior to the judgment or final
order requiring a party or a court, agency or a person to refrain from a particular act or acts. It is the strong arm
of equity, an extraordinary peremptory remedy that must be used with extreme caution, affecting as it does the
respective rights of the parties.
As with all equitable remedies, injunction must be issued only at the instance of a party who possesses
sufficient interest in or title to the right or the property sought to be protected. It is proper only when the
applicant appears to be entitled to the relief demanded in the complaint, which must aver the existence of the
right and the violation of the right, or whose averments must in the minimum constitute a prima facie showing
of a right to the final relief sought. Accordingly, the conditions for the issuance of the injunctive writ are: (a)
that the right to be protected exists prima facie; (b) that the act sought to be enjoined is violative of that right;
and (c) that there is an urgent and paramount necessity for the writ to prevent serious damage. An injunction
will not issue to protect a right not in esse, or a right which is merely contingent and may never arise; or to
restrain an act which does not give rise to a cause of action; or to prevent the perpetration of an act prohibited
by statute. Indeed, a right, to be protected by injunction, means a right clearly founded on or granted by law or
is enforceable as a matter of law.
Under the circumstances averred in the complaint in Civil Case No. CEB-26468, the issuance of the
writ of preliminary injunction upon the application of the respondents was improper. They had admittedly
constituted the real estate and chattel mortgages to secure the performance of their loan obligation to the
petitioner, and, as such, they were fully aware of the consequences on their rights in the properties given as
collaterals should the loan secured be unpaid. The foreclosure of the mortgages would be the remedy provided
30
by law for the mortgagee to exact payment. In fact, they did not dispute the petitioners allegations that they
had not fully paid their obligation, and that Civil Case No. CEB-26468 was precisely brought by them in order
to stave off the impending foreclosure of the mortgages based on their claim that they had been compelled to
sign pre-printed standard bank loan forms and mortgage agreements
Thus, to be entitled to the writ of preliminary injunction, the private respondent needs only to show that
it has the ostensible right to the final relief prayed for in its complaint.
It is also basic that the power to issue a writ of injunction is to be exercised only where the reason and
necessity therefor are clearly established, and only in cases reasonably free from doubt. For, truly, a
preliminary injunction should not determine the merits of a case,or decide controverted facts. As a preventive
remedy, injunction only seeks to prevent threatened wrong, further injury, and irreparable harm or
injustice until the rights of the parties can be settled. As an ancillary and preventive remedy, it may be resorted
to by a party to protect or preserve his rights during the pendency of the principal action, and for no other
purpose. Such relief will accordingly protect the ability of the court to render a meaningful decision; it will
further serve to guard against a change of circumstances that will hamper or prevent the granting of proper
relief after a trial on the merits. Verily, its essential function is to preserve the status quo between the parties
until the merits of the case can be heard.
The injury being feared by the herein respondents is not of such nature. Ultimately, the amount to
which the mortgagee-bank shall be entitled will be determined by the disposition of the trial court in the main
issue of the case.
 As a general rule, the courts will not issue writs of prohibition or injunction whether preliminary or
48
final in order to enjoin or restrain any criminal prosecution. But there are extreme cases in which exceptions
to the general rule have been recognized.However, the respondents did not sufficiently show that Civil Case
No. CEB-26468 came under any of the foregoing exceptions. Hence, the issuance by the RTC of the writ of
preliminary injunction to enjoin the petitioner from instituting criminal complaints for violation of BP No. 22
against the respondents was unwarranted.
Every court should remember that an injunction should not be granted lightly or precipitately because it
is a limitation upon the freedom of the defendants action. It should be granted only when the court is fully
satisfied that the law permits it and the emergency demands it, for no power exists whose exercise is more
delicate, which requires greater caution and deliberation, or is more dangerous in a doubtful case, than the
issuance of an injunction.
In view of the foregoing, the CA grossly erred in not declaring that the RTC committed grave abuse of
discretion in granting the application of the respondents as the plaintiffs in Civil Case No. CEB-26468. The
RTC apparently disregarded the aforecited well-known norms and guidelines governing the issuance of the writ
of injunction. Thereby, the RTC acted capriciously and arbitrarily.

Heirs of Marcelo Sotto vs. Matilde Palicte

G.R. No. 159691, February 17, 2014

BERSAMIN, J.:
For the ground to be effective, the insufficiency of the complaint must appear on the face of the complaint, and
nowhere else. It will be unfair to the plaintiff, indeed, to determine the sufficiency of his cause of action from
facts outside of those pleaded in the complaint.

FACTS:
This case is the fifth suit to reach the Court dividing the several heirs of the late Don Filemon Y. Sotto
respecting four real properties that had belonged to Filemons estate.
The first case (Matilde S. Palicte v. Hon. Jose O. Ramolete, et al., No. L55076, September 21, 1987,
154 SCRA 132) held that herein respondent Matilde S. Palicte (Matilde), one of four declared heirs of Filemon,
had validly redeemed the four properties pursuant to the assailed deed of redemption, and was entitled to have
the title over the four properties transferred to her name.

The second was the civil case filed by Pascuala against Matilde (Civil Case No. CEB19338) to annul
the formers waiver of rights, and to restore her as a coredemptioner of Matilde with respect to the four
properties (G.R. No. 131722, February 4, 1998).
The third was an incident in Civil Case No. R10027 (that is, the suit brought by the heirs of Carmen
Rallos against the Estate of Sotto) wherein the heirs of Miguel belatedly filed in November 1998 a motion for
reconsideration praying that the order issued on October 5, 1989 be set aside, and that they be still included as
Matildes coredemptioners. After the trial court denied their motion for reconsideration for its lack of merit,
the heirs of Miguel elevated the denial to the CA on certiorari and prohibition, but the CA dismissed their
petition. Thence, the heirs of Miguel came to the Court on certiorari (G.R. No. 154585), but the Court
dismissed their petition for being filed out of time and for lack of merit.
The fourth was The Estate of Don Filemon Y. Sotto, represented by its duly designated Administrator,
Sixto Sotto Pahang, Jr. v. Matilde S. Palicte, et al. (G.R. No. 158642, September 22, 2008, 566 SCRA 142),
whereby the Court expressly affirmed the ruling rendered by the probate court in Cebu City in Special
Proceedings No. 2706R entitled Intestate Estate of the Deceased Don Filemon Sotto denying the
administrators motion to require Matilde to turn over the four real properties to the Estate of Sotto.
The fifth is this case. It seems that the disposition by the Court of the previous cases did not yet satisfy
herein petitioners despite their being the successorsininterest of two of the declared heirs of Filemon who
had been parties in the previous cases either directly or in privity. They now pray that the Court undo the
decision promulgated on November 29, 2002, whereby the CA declared their action for the partition of the four
properties as already barred by the judgments previously rendered, and the resolution denying their motion for
reconsideration.
ISSUE: Whether or not petitioners and their counsel are guilty of forum shopping.

RULING: YES.
What we have seen here is a clear demonstration of unmitigated forum shopping on the part of
petitioners and their counsel. It should not be enough for us to just express our alarm at petitioners disregard of
the doctrine of res judicata.
First of all, Atty. Mahinay claims that he could not be deemed guilty of forum shopping because the
previous cases did not involve the issues raised in Civil Case No. CEB24293; hence, res judicata would not
apply. He maintains that Civil Case No. CEB24293 was based on the agreement between Palicte and Marcelo
Sotto (the then Administrator of the Estate). To establish the agreement between Palicte and Marcelo Sotto,
Atty. Mahinay cites Palictes filing of a motion to dismiss in Civil Case No. CEB24293 on the ground, among
others, of the complaint failing to state a cause of action whereby Palicte hypothetically admitted the
complaints averment of the agreement. Atty. Mahinays reliance on Palictes hypothetical admission of her
agreement with Marcelo Sotto to buttress his explanation here is unjustified. Such hypothetical admission is
only for the purpose of resolving the merits of the ground of insufficiency of the complaint.
For the ground to be effective, the insufficiency of the complaint must appear on the face of the
complaint, and nowhere else. It will be unfair to the plaintiff, indeed, to determine the sufficiency of his cause
of action from facts outside of those pleaded in the complaint. Clearly, Atty. Mahinay cannot bind Palicte to her
hypothetical admission of the agreement between her and Marcelo Sotto as the Administrator of the Estate.
Secondly, Atty. Mahinay asserts good faith in the filing Civil Case No. CEB24293. It is axiomatic
that a lawyer shall not handle any legal matter without adequate preparation. Moreover, laying the blame on the
associate lawyer is not plausible. Any client who employs a law firm undeniably engages the entire law firm,
not a particular member of it. Even assuming that Atty. Mahinay did not himself prepare the complaint, it
remains that he subsequently personally handled the case. In so doing, he had sufficient time to still become
fully acquainted with the previous cases and their incidents.
Thirdly, Atty. Mahinay states that his filing of the Motion To Refer Or Consolidate The Instant Case
With The Proceedings In The Intestate Estate Of Filemon Sotto Before RTC Branch XVI In SP Proc. No. 2706
R disproved deliberate forum shopping on his part. The Court disagrees. Atty. Mahinays filing of the Motion
To Refer Or Consolidate The Instant Case With The Proceedings In The Intestate Estate Of Filemon Sotto
Before RTC Branch XVI indicated that he relentlessly pursued the goal of taking away the properties from
Palicte in disregard of the rulings in the earlier cases. We note that the dismissal of the complaint in Civil Case
No. CEB24293 on November 15, 1999 prompted Atty. Mahinay to file a motion for reconsideration. But he
did not await the resolution of the motion for reconsideration, and instead filed the Motion To Refer Or
Consolidate The Instant Case With The Proceedings In The Intestate Estate Of Filemon Sotto Before RTC
Branch XVI obviously to preempt the trial courts denial of the motion. His actuations did not manifest good
faith on his part.

And, lastly, Atty. Mahinay argues that his assisting the Administrator of the Estate in filing the Motion
to Require Matilde Palicte To Turn Over And/or Account Properties Owned by the Estate in Her Possession,
wherein he disclosed the commencement of Civil Case No. CEB24293, and extensively quoted the allegations
of the complaint, disproved any forum shopping. The insistence cannot command belief. The disclosure alone
of the pendency of a similar case does not negate actual forum shopping. Had Atty. Mahinay been sincere, the
least he could have done was to cause the dismissal of the action that replicated those already ruled against his
clients. The records show otherwise.

The acts of a party or his counsel clearly constituting willful and deliberate forum shopping shall be
ground for the summary dismissal of the case with prejudice, and shall constitute direct contempt, as well as be
a cause for administrative sanctions against the lawyer. If the forum shopping is not willful and deliberate, the
subsequent cases shall be dismissed without prejudice on one of the two grounds mentioned above. But if the
forum shopping is willful and deliberate, both (or all, if there are more than two) actions shall be dismissed
with prejudice. In view of the foregoing, Atty. Mahinay was guilty of forum shopping.

Herminia Acbang vs. Hon. Jimmy Luczon, Jr,

G.R. No. 164246, January 15, 2014
BERSAMIN, J.:
To stay the immediate execution of the judgment in an ejectment case, the defendant must perfect an appeal,
file a supersedeas bond, and periodically deposit the rentals becoming due during the pendency of the appeal.
Otherwise, the writ of execution will issue upon motion of the plaintiff.
FACTS:
Respondent Spouses Spouses Lopez commenced an ejectment suit against the petitioner, her son
Benjamin Acbang, Jr. and his wife Jean (Acbangs) in the Municipal Trial Court (MTC) of Alcala (Civil Case
No. 6302). The defendants did not file an answer; hence, the MTC rendered its decision on in favor of Spouses
Lopez.
The petitioner appealed to the RTC. Spouses Lopez moved for the execution of the decision pending
appeal in the RTC, alleging that the defendants had not filed a supersedeas bond to stay the execution. The
Acbangs opposed the motion insisting that the failure of the Spouses Lopez to move for the execution in the
MTC constituted a waiver of their right to the immediate execution. Judge Luczon granted the motion for
immediate execution.
The opposition of spouses Lopez on the appeal taken by the Acbangs is hereby denied because under
the rules the losing party may appeal the case even if they did not post their supercedeas bond. The petitioner
moved for reconsideration which was denied by the RTC. The petitioner then brought the petition for
prohibition directly in this Court, submitting that Judge Luczon thereby committed grave error in granting the
motion for immediate execution of the Spouses Lopez without first fixing the supersedeas bond as prayed for
by the Acbangs.

It appears that the RTC rendered its decision in Civil Case No. 6302 on July 30, 2004, finding that the
petitioner had not received the summons, that the non-service of the summons on her resulted in the MTC not
acquiring jurisdiction over her; and that the MTCs decision in Civil Case No. 64 dated January 14, 2004 was
void as far as she was concerned. The MTC of Alcala is Ordered to reopen the case and served the summons to
Herminia Acbang and conduct the proceedings without any delay.
In the petition, the petitioner insists that the Spouses Lopezs motion for execution pending appeal
should be filed before she posted a supersedeas bond.

ISSUE: Whether or not under the circumstances, the writ of execution will issue upon motion of the plaintiff.

RULING: YES.
To stay the immediate execution of the judgment in an ejectment case, the defendant must perfect an
appeal, file a supersedeas bond, and periodically deposit the rentals becoming due during the pendency of
the appeal. Otherwise, the writ of execution will issue upon motion of the plaintiff.
As a general rule, a judgment in favor of the plaintiff in an ejectment suit is immediately executory, in
order to prevent further damage to him arising from the loss of possession of the property in question. To stay
the immediate execution of the said judgment while the appeal is pending the law requires that the following
requisites must concur: (1) the defendant perfects his appeal; (2) he files a supersedeas bond; and (3) he
periodically deposits the rentals which become due during the pendency of the appeal. The failure of the
defendant to comply with any of the conditions is a ground for the outright execution of the judgment, the duty
of the court in this respect being "ministerial and imperative. Conversely, the filing of a supersedeas bond will
not stay the execution of the judgment if the appeal is not perfected. Necessarily then, the supersedeas bond
should be filed within the period for the perfection of the appeal.
Although the petitioner correctly states that the Spouses Lopez should file a motion for execution
pending appeal before the court may issue an order for the immediate execution of the judgment, the spouses
Lopez are equally correct in pointing out that they were entitled to the immediate execution of the judgment in
view of the Acbangs failure to comply with all of the three abovementioned requisites for staying the
immediate execution. The filing of the notice of appeal alone perfected the appeal but did not suffice to stay the
immediate execution without the filing of the sufficient supersedes bond and the deposit of the accruing rentals.
The foregoing notwithstanding, the decision of the R TC favored the petitioner because it declared the
judgment of the MTC void as far as she was concerned for lack of jurisdiction over her person. The
supervening declaration of the nullity of the judgment being sought to be executed against her has rendered
moot and academic the issue in this special civil action as far as she was concerned.

Thelma Aranas vs. Teresita Mercado et al

G.R. No. 156407, January 15, 2014
BERSAMIN, J.:
The propriety of the special civil action for certiorari as a remedy depended on whether the assailed orders of
the RTC were final or interlocutory in nature. The test to ascertain whether or not an order or a judgment is
interlocutory or final is: does the order or judgment leave something to be done in the trial court with respect
to the merits of the case? If it does, the order or judgment is interlocutory; otherwise, it is final. The remedy
against an interlocutory order not subject of an appeal is an appropriate special civil action under Rule 65,
provided that the interlocutory order is rendered without or in excess of jurisdiction or with grave abuse of
discretion. Then is certiorari under Rule 65 allowed to be resorted to.
FACTS:
Emigdio S. Mercado died intestate survived by his second wife, Teresita V. Mercado and their five
children; and his two children by his first marriage, namely: respondent Franklin L. Mercado and petitioner
Thelma M. Aranas (Thelma). The RTC in Cebu City granted Thelmas application for the appointment of
Teresita as the administrator of Emigdios estate. Teresita submitted an inventory of the estate of Emigdio for
the consideration and approval by the RTC. She indicated in the inventory that at the time of his death, Emigdio
had left no real properties but only personal properties. Claiming that Emigdio had owned other properties that
were excluded from the inventory, Thelma moved that the RTC direct Teresita to amend the inventory, and to
be examined regarding it which was granted by the RTC. Teresita filed a compliance with the order of January
8, 1993.
The RTC issued an order expressing the need for the parties to present evidence and for Teresita to be
examined to enable the court to resolve the motion for approval of the inventory. Thelma opposed the approval
of the inventory, and asked leave of court to examine Teresita on the inventory. The RTC issued an order
holding that the inventory submitted by Teresita had excluded properties that should be included; hence, it
denied the administratrixs motion for approval of inventory. Teresita, timely sought the reconsideration of the
said order on the ground that one of the real properties affected, had already been sold to Mervir Realty, the
RTC denied the motion for reconsideration.
Hence, Teresita, joined by her four children and her stepson Franklin, assailed the adverse orders of the
RTC promulgated on March 14, 2001 and May 18, 2001 by petition for certiorari before the CA.

ISSUES:
Whether or not certiorari was the proper recourse to assail the questioned orders of the RTC.

Whether or not the RTC commit grave abuse of discretion in directing the inclusion of the propertiesin the
estate of the decedent.

RULING:
The propriety of the special civil action for certiorari as a remedy depended on whether the assailed
orders of the RTC were final or interlocutory in nature. The test to ascertain whether or not an order or a
judgment is interlocutory or final is: does the order or judgment leave something to be done in the trial court
with respect to the merits of the case? If it does, the order or judgment is interlocutory; otherwise, it is final.
The remedy against an interlocutory order not subject of an appeal is an appropriate special civil action under
Rule 65, provided that the interlocutory order is rendered without or in excess of jurisdiction or with grave
abuse of discretion. Then is certiorari under Rule 65 allowed to be resorted to.
The assailed order of March 14, 2001 denying Teresitas motion for the approval of the inventory and
the order dated May 18, 2001 denying her motion for reconsideration were interlocutory. This is because the
inclusion of the properties in the inventory was not yet a final determination of their ownership. Hence, the
approval of the inventory and the concomitant determination of the ownership as basis for inclusion or
exclusion from the inventory were provisional and subject to revision at any time during the course of the
administration proceedings.

Rule 83 of the Rules of Court provides that;

Section 1. Inventory and appraisal to be returned within three months. Within three (3) months after his
appointment every executor or administrator shall return to the court a true inventory and appraisal of all the
real and personal estate of the deceased which has come into his possession or knowledge. In the appraisement
of such estate, the court may order one or more of the inheritance tax appraisers to give his or their assistance.
The usage of the word all in Section 1, supra, demands the inclusion of all the real and personal
properties of the decedent in the inventory. Section 1 allows no exception, for the phrase true inventory implies
that no properties appearing to belong to the decedent can be excluded from the inventory, regardless of their
being in the possession of another person or entity.
The general rule is that the jurisdiction of the trial court, either as a probate court or an intestate court,
relates only to matters having to do with the probate of the will and/or settlement of the estate of deceased
persons, but does not extend to the determination of questions of ownership that arise during the proceedings.
The patent rationale for this rule is that such court merely exercises special and limited jurisdiction. However,
this general rule is subject to exceptions as justified by expediency and convenience.
First, the probate court may provisionally pass upon in an intestate or a testate proceeding the question
of inclusion in, or exclusion from, the inventory of a piece of property without prejudice to final determination
of ownership in a separate action. Second, if the interested parties are all heirs to the estate, or the question is
one of collation or advancement, or the parties consent to the assumption of jurisdiction by the probate court
and the rights of third parties are not impaired, then the probate court is competent to resolve issues on
ownership. Verily, its jurisdiction extends to matters incidental or collateral to the settlement and distribution of
the estate, such as the determination of the status of each heir and whether the property in the inventory is
conjugal or exclusive property of the deceased spouse.
Thereby, the RTC strictly followed the directives of the Rules of Court and the jurisprudence relevant
to the procedure for preparing the inventory by the administrator. The aforequoted explanations indicated that
the directive to include the properties in question in the inventory rested on good and valid reasons, and thus
was far from whimsical, or arbitrary, or capricious. As long as the RTC commits no patent grave abuse of
discretion, its orders must be respected as part of the regular performance of its judicial duty.

Isabelita Vinuya et al vs. Honorable Executive Secretary Alberto Romulo et al

G.R. No. 162230, August 12, 2014
BERSAMIN, J.:
The right to file a special civil action of certiorari is neither a natural right nor an essential element of due
process; a writ of certiorari is a prerogative writ, never demandable as a matter of right, and never issued
except in the exercise of judicial discretion. Hence, he who seeks a writ of certiorari must apply for it only in
the manner and strictly in accordance with the provisions of the law and the Rules.
FACTS:
Petitioners filed a Motion for Reconsideration and a Supplemental Motion for Reconsideration, praying
that the Court reverse its decision of April 28, 2010, and grant their petition for certiorari. Petitioners argue that
our constitutional and jurisprudential histories have rejected the Courts ruling that the foreign policy
prerogatives of the Executive Branch are unlimited; that under the relevant jurisprudence and constitutional
provisions, such prerogatives are proscribed by international human rights and international conventions of
which the Philippines is a party; that the Court, in holding that the Chief Executive has the prerogative whether
to bring petitioners claims against Japan, has read the foreign policy powers of the Office of the President in
isolation from the rest of the constitutional protections that expressly textualize international human rights; that
the foreign policy prerogatives are subject to obligations to promote international humanitarian law as
incorporated into the laws of the land through the Incorporation Clause.
The petitioners added that the status and applicability of the generally accepted principles of
international law within the Philippine jurisdiction would be uncertain without the Incorporation Clause, and
that the clause implied that the general international law forms part of Philippine law only insofar as they are
expressly adopted; that in its rulings in The Holy See, v. Rosario, Jr. and U.S. v. Guinto the Court has said that
international law is deemed part of the Philippine law as a consequence of Statehood; that by virtue of the
Incorporation Clause, the Philippines is bound to abide by the erga omnes obligations arising from the jus
cogens norms embodied in the laws of war and humanity that include the principle of the imprescriptibility of
war crimes; that the crimes committed against petitioners are proscribed under international human rights law
as there were undeniable violations of jus cogens norms; that the need to punish crimes against the laws of
humanity has long become jus cogens norms, and that international legal obligations prevail over national legal
norms; that the Courts invocation of the political doctrine in the instant case is misplaced; and that the Chief
Executive has the constitutional duty to afford redress and to give justice to the victims of the comfort women
system in the Philippines.
Petitioners pray that the Court reconsider its April 28, 2010 decision, and declare: (1) that the rapes,
sexual slavery, torture and other forms of sexual violence committed against the Filipina comfort women are
crimes against humanity and war crimes under customary international law; (2) that the Philippines is not
bound by the Treaty of Peace with Japan, insofar as the waiver of the claims of the Filipina comfort women
against Japan is concerned; (3) that the Secretary of Foreign Affairs and the Executive Secretary committed
grave abuse of discretion in refusing to espouse the claims of Filipina comfort women; and (4) that petitioners
are entitled to the issuance of a writ of preliminary injunction against the respondents. Petitioners also pray that
the Court order the Secretary of Foreign Affairs and the Executive Secretary to espouse the claims of Filipina
comfort women for an official apology, legal compensation and other forms of reparation from Japan.
In their Supplemental Motion for Reconsideration, petitioners stress that it was highly improper for the
April 28, 2010 decision to lift commentaries from at least three sources without proper attribution an article
published in 2009 in the Yale Law Journal of International Law; a book published by the Cambridge University
Press in 2005; and an article published in 2006 in the Western Reserve Journal of International Law and make
it appear that such commentaries supported its arguments for dismissing the petition, when in truth the
plagiarized sources even made a strong case in favour of petitioners claims.

ISSUE: Whether or not the Motion for Reconsideration and Supplemental Motion for Reconsideration should
be granted.

RULING: NO

Petitioners did not show that their resort was timely under the Rules of Court.

Petitioners did not show that their bringing of the special civil action for certiorari was timely, i.e.,
within the 60-day period provided in Section 4, Rule 65 of the Rules of Court. There are three essential dates
that must be stated in a petition for certiorari brought under Rule 65. First, the date when notice of the
judgment or final order or resolution was received; second, when a motion for new trial or reconsideration was
filed; and third, when notice of the denial thereof was received. Failure of petitioner to comply with this
requirement shall be sufficient ground for the dismissal of the petition. Substantial compliance will not suffice
in a matter involving strict observance with the Rules.
The petition mentions the year 1998 only as the time when petitioners approached the Department of
Justice for assistance, but does not specifically state when they received the denial of their request for
assistance by the Executive Department of the Government. This alone warranted the outright dismissal of the
petition. Even assuming that petitioners received the notice of the denial of their request for assistance in 1998,
their filing of the petition only on March 8, 2004 was still way beyond the 60-day period. Only the most
compelling reasons could justify the Courts acts of disregarding and lifting the strictures of the rule on the
period.
As we have repeatedly stressed, the right to file a special civil action of certiorari is neither a natural
right nor an essential element of due process; a writ of certiorari is a prerogative writ, never demandable as a
matter of right, and never issued except in the exercise of judicial discretion. Hence, he who seeks a writ
of certiorari must apply for it only in the manner and strictly in accordance with the provisions of the law and
the Rules. Herein petitioners have not shown any compelling reason for us to relax the rule and the
requirements under current jurisprudence.

Petitioners did not show that the assailed act was either judicial or quasi-judicial on the part of
respondents.
 Petitioners were required to show in their petition for certiorari that the assailed act was either judicial
or quasi-judicial in character. Section 1, Rule 65 of the Rules of Court requires such showing.
The petition shall be accompanied by a certified true copy of the judgment, order, or resolution subject
thereof, copies of all pleadings and documents relevant and pertinent thereto, and a sworn certification of non-
forum shopping as provided in the third paragraph of Section 3, Rule 46. However, petitioners did not make
such a showing.

Petitioners were not entitled to the injunction.

The Court cannot grant petitioners prayer for the writ of preliminary mandatory injunction.
Preliminary injunction is merely a provisional remedy that is adjunct to the main case, and is subject to the
22
latters outcome. It is not a cause of action itself. It is provisional because it constitutes a temporary measure
availed of during the pendency of the action; and it is ancillary because it is a mere incident in and is dependent
upon the result of the main action. Following the dismissal of the petition for certiorari, there is no more legal
basis to issue the writ of injunction sought. As an auxiliary remedy, the writ of preliminary mandatory
injunction cannot be issued independently of the principal action.
It is basic that the issuance of a writ of preliminary injunction is addressed to the sound discretion of
the trial court, conditioned on the existence of a clear and positive right of the applicant which should be
protected. It is an extraordinary, peremptory remedy available only on the grounds expressly provided by law,
specifically Section 3, Rule 58 of the Rules of Court. Moreover, extreme caution must be observed in the
exercise of such discretion. It should be granted only when the court is fully satisfied that the law permits it and
the emergency demands it.
Here, the Constitution has entrusted to the Executive Department the conduct of foreign relations for
the Philippines. Whether or not to espouse petitioners claim against the Government of Japan is left to the
exclusive determination and judgment of the Executive Department. The Court cannot interfere with or
question the wisdom of the conduct of foreign relations by the Executive Department. Accordingly, we cannot
direct the Executive Department, either by writ of certiorari or injunction, to conduct our foreign relations with
Japan in a certain manner.

Juanito Magsino vs. Elena De Ocampo and Ramon Guico

G.R. No. 166944, August 18, 2014
BERSAMIN, J.:
FACTS:
The petitioner filed against the respondents a complaint for forcible entry with prayer for preliminary
mandatory injunction and/or temporary restraining order in the Metropolitan Trial Court in Antipolo City
alleging that he was the owner in fee simple of a parcel of agricultural land situated in Sapinit, San Juan,
Antipolo City; that on February 5, 2000, the respondents, through force, intimidation, threats and strategy and
with the aid of armed men, had unlawfully bulldozed the eastern and northern portions of his land, cutting
lengthwise through the land, destroying ornamental plants and fruit-bearing trees that he had himself planted
several years before, thereby illegally depriving him of the possession of the land.
The petitioner filed a motion for preliminary mandatory injunction but the Municipal Trial Court in
Taytay, Rizal (MTC) issued only a writ of preliminary injunction. Respondent Elena De Ocampo countered
that she had held a registered title in the land by virtue of the original certificate of title issued to her mother,
Cecilia De Ocampo; and that the petitioner was a squatter on the land with no possessory rights.
The MTC rendered its judgment in favor of the respondents. Dissatisfied, the petitioner appealed to the
CA by petition for review. However, the CA promulgated its first assailed resolution dismissing the petition for
review as the petition is not accompanied by copies of the pleadings and other material portions as would
support the allegations of the petition. Hence, this appeal.

ISSUE: Whether or not the CA erred in dismissing the petition for review on the ground that the petitioner did
not comply with Section 2, Rule 42 of the Rules of Court.

RULING: NO
As earlier mentioned, the CA issued the first assailed resolution dismissing the petition for review
because the petitioner did not attach to his petition the complaint, the answer, and the motion to dismiss, all
filed in the MTC; and the copies of the parties memoranda on appeal presented in the RTC. Such dismissal
was pursuant to Section 3, Rule 42 of the Rules of Court.
We begin by reminding the petitioner that the right to appeal is not a natural right and is not part of due
process, but merely a statutory privilege to be exercised only in accordance with the law. Being the party who
sought to appeal, he must comply with the requirements of the relevant rules; otherwise, he would lose the
statutory right to appeal. Whether or not the dismissal of the petition for review was warranted depended on
whether or not there remained sufficient materials in the records to still enable the CA to act on the appeal
despite the omissions.
The Court recognized three guideposts for the CA to consider in determining whether or not the rules
of procedures should be relaxed, as follows:
First, not all pleadings and parts of case records are required to be attached to the petition. Only those
which are relevant and pertinent must accompany it.

Second, even if a document is relevant and pertinent to the petition, it need not be appended if it is
shown that the contents thereof can also (sic) found in another document already attached to the
petition.

Third, a petition lacking an essential pleading or part of the case record may still be given due course
or reinstated (if earlier dismissed) upon showing that petitioner later submitted the documents required,
or that it will serve the higher interest of justice that the case be decided on the merits.

The guideposts, which equally apply to a petition for review filed in the CA under Rule 42, reflect that
the significant determinant of the sufficiency of the attached documents is whether the accompanying
documents support the allegations of the petition.
Under the first guidepost recognized in Galvez, only the relevant pleadings and parts of the case
records needed to be attached to the petition for review. Hence, not every pleading or document filed or
submitted in the lower courts had to be attached to the petition. The test of relevancy is whether the document
in question would support the material allegations of the petition. Accordingly, we turn to what were omitted
by the petitioner.
The first omitted document was the complaint in Civil Case No. 4141. Being the initiatory pleading,
the complaint included all the material facts and dates necessary to support the petitioners cause of action for
forcible entry, specifically: (1) his prior physical possession of the property; (2) his being deprived of the
physical possession either by force, intimidation, threat, strategy, or stealth; and (3) his filing of the action
within one year from the time he or his representative learned of the deprivation of physical possession of the
land or building.
The next omitted pleading was the answer of the respondents. As with the complaint, the answer was
relevant in the appeal in the CA, for the respondents as the defendants had set forth their defenses therein.
The third omitted document was the motion to dismiss. Although the motion to dismiss would appear
to be less relevant in view of the filing of the answer by the respondents, the CA could have had good reasons
for noting its omission as a ground to dismiss the petition for review.
The memoranda on appeal the parties respectively filed in the RTC were the fourth kind of omitted
documents. In respect of the petitioner, his memorandum, which was due to be filed within 15 days from the
filing of his notice of appeal as required by Section 7, Rule 40 of the Rules of Court, would have specified and
supported the errors he imputed to the MTC. Such filing in the RTC could not be dispensed with, for the RTC
would consider only the errors specifically assigned and argued in his memorandum, except errors affecting
jurisdiction over the subject matter as well as plain and clerical errors. If the memorandum was not filed, the
appeal could be dismissed. Unless his memorandum was part of his petition for review, therefore, the CA
would likely find his appeal frivolous, or even consider it dismissible pursuant to Section 3, Rule 42. Based on
the foregoing considerations, the petitioner entirely bypassed the first guidepost recognized in Galvez.
The second guidepost which stipulates that a document, although relevant to the petition for review,
need not be appended if it is shown that its contents could be found in or could be drawn from another
document already attached to the petition refers to a process whereby the CA derives the contents of the
omitted relevant document from another attached to the petition for review filed in the CA.
The petitioner posited in his motion for reconsideration that the copy of the MTC decision was a
sufficient basis to resolve the issues he was raising in his petition for review. Even with the copy of the MTC
judgment being actually attached to the petition for review, however, the second guidepost could not be
complied with because the copy was hopelessly illegible. Moreover, the MTC judgment did not contain the
statement of the issues relied upon by the petitioner in his appeal in the CA, for such statement was made only
in his memorandum on appeal.
The mere fact that a petition for review is filed does not call for the elevation of the record, which
means that until this Court finds that the elevation of the record is necessary, such record should remain with
the trial court during the pendency of the appeal in accordance with Section 2 of Rule 39, let alone the fact that
in ejectment cases the decision of the RTC is immediately executory pursuant to Section 21 of the Revised
Rule on Summary Procedure. Thus, more often than not, this Court has resolved petitions for review under
Rule 42 without unnecessary movement of the original record of the case which could entail not only undue
delay but also the possibility of the record being lost in transit.
Instead of manifesting that he would submit the additional documentary evidence, the petitioner
remained obstinate in his stand not to submit the additional pleadings and other material portions of the record.
He maintained that what he has submitted based on his discretion, are all that are necessary to support his
allegations in his petition. Instead, the petitioner stubbornly chose to insist that this Court direct the elevation of
the records of the case if we deem that the relevant documents were not appended to the petition. In this case,
the insufficiency of the supporting documents coupled with the unjustified refusal of the petitioner to even
attempt to substantially comply with the attachment requirement justified the dismissal of his petition.
The petitioners plea for the application of the principles of substantial justice in their favor deserves
scant consideration. While the petitioners adverted to several jurisprudential rulings of this Court which set
aside procedural rules, it is noted that there were underlying considerations in those cases which warranted a
disregard of procedural technicalities to favor substantial justice. Here, there exists no such consideration. The
petitioners ought to be reminded that the bare invocation of the interest of substantial justice is not a magic
wand that will automatically compel this Court to suspend procedural rules. Procedural rules are not to be
belittled or dismissed simply because their non-observance may have resulted in prejudice to a partys
substantive rights.
The petitioner did not deserve the liberal application of the rules of procedure that he was seeking.
Indeed, the dismissal of his petition for review was in full accord with the following pronouncement upon a
similar provision in the Rules of Court made in Atillo v. Bombay, as follows: The mandatory tenor of Section
2(d), Rule 42 with respect to the requirement of attaching clearly legible duplicate originals or true copies of
the judgments or final orders of both lower courts is discernible and well settled. In this case, the mandatory or
directory nature of the requirement with respect to the attachment of pleadings and other material portions of
the record is put in question.

Saint Mary Crusade to Alleviate Poverty of Brethen Foundation Inc. vs. Hon. Teodoro Riel
G.R. No. 176508, January 12, 2015
BERSAMIN, J.:
A petition for the judicial reconstitution of a Torrens title must strictly comply with the requirements prescribed
in Republic Act No. 26; otherwise, the petition should be dismissed.
FACTS:
Petitioner claimed in its petition for reconstitution that the original copy of OCT No. 1609 had been burnt and
lost in the fire that gutted the Quezon City Register of Deeds in the late 80s. Initially, respondent Judge gave
due course to the petition, but after the preliminary hearing, he dismissed the petition for reconstitution through
the first assailed order. Petitioner moved for reconsideration of the dismissal. RTC denied the motion for
reconsideration for lack of any cogent or justifiable ground to reconsider.

ISSUE: Whether or not the RTC gravely abused its discretion amounting to lack or excess of its jurisdiction in
dismissing its petition for reconstitution on the basis of the recommendation of the LRA and the opposition of
the Republic and the UP despite having initially given due course to the petition for reconstitution.

RULING: No
The petition for certiorari and mandamus did not show how respondent Judge could have been guilty of lacking
or exceeding his jurisdiction, or could have gravely abused his discretion amounting to lack or excess of
jurisdiction.
Firstly, Under Section 12 of Republic Act No. 26, the law on the judicial reconstitution of a Torrens title, the
Regional Trial Court (as the successor of the Court of First Instance) had the original and exclusive jurisdiction
to act on the petition for judicial reconstitution of title. Hence, the RTC neither lacked nor exceeded its
authority in acting on and dismissing the petition. Nor did respondent Judge gravely abuse his discretion
amounting to lack or excess of jurisdiction considering that the petition for reconstitution involved land already
registered in the name of the UP, as confirmed by the LRA. Instead, it would have been contrary to law had
respondent Judge dealt with and granted the petition for judicial reconstitution of title of the petitioner.
Secondly, the petitioner did not present the duplicate or certified copy of OCT No. 1609. Thereby, it disobeyed
Section 2 and Section 3 of Republic Act No. 26, the provisions that expressly listed the acceptable bases for
judicial reconstitution of an existing Torrens title.
Thirdly, the questioned orders of the RTC having finally disposed of the application for judicial reconstitution,
nothing more was left for the RTC to do in the case.
As of then, therefore, the correct recourse for the petitioner was to appeal to the Court of Appeals by notice of
appeal within 15 days from notice of the denial of its motion for reconsideration. By allowing the period of
appeal to elapse without taking action, it squandered its right to appeal. Its present resort to certiorari is
impermissible, for an extraordinary remedy like certiorari cannot be a substitute for a lost appeal.
Fourthly, the filing of the instant special civil action directly to the Supreme Court is in disregard of the
doctrine of hierarchy of courts. Although the Court has concurrent jurisdiction with the Court of Appeals in
issuing the writ of certiorari, direct resort is allowed only when there are special, extraordinary or compelling
reasons that justify the same. The Court enforces the observance of the hierarchy of courts in order to free itself
from unnecessary, frivolous and impertinent cases and thus afford time for it to deal with the more fundamental
and more essential tasks that the Constitution has assigned to it. There being no special, important or
compelling reason, the petitioner thereby violated the observance of the hierarchy of courts, warranting the
dismissal of the petition for certiorari.
Finally, the land covered by the petition for judicial reconstitution related to the same area that formed the UP
campus. The UPs registered ownership of the land comprising its campus has long been settled under the law.
Accordingly, the dismissal of the petition for judicial reconstitution by respondent Judge only safeguarded the
UPs registered ownership.

Republic of the Philippines vs. Heirs of Saturnino Borbon and Court of Appeals
G.R. No.165354, January 12, 2015
BERSAMIN, J.:
The expropriator who has taken possession of the property subject of expropriation is obliged to pay
reasonable compensation to the landowner for the period of such possession although the proceedings had
been discontinued on the ground that the public purpose for the expropriation had meanwhile ceased.
FACTS:
NAPOCOR entered a property located in Barangay San Isidro, Batangas City in order to construct and maintain
transmission lines for the 230 KV Mahabang Parang-Pinamucan Power Transmission Project. Respondents
heirs of Saturnino Q. Borbon owned the property, with a total area of 14,257 square meters, which was
registered under Transfer Certificate of Title No. T-9696 of the Registry of Deeds of Batangas. NAPOCOR
filed a complaint for expropriation in the Regional Trial Court in Batangas City (RTC), seeking the acquisition
of an easement of right of way over a portion of the property involving an area of only 6,326 square meters,
more or less, alleging that it had negotiated with the respondents for the acquisition of the easement but they
had failed to reach any agreement; and that, nonetheless, it was willing to deposit the amount of P9,790.00
representing the assessed value of the portion sought to be expropriated.6 It prayed for the issuance of a writ of
possession upon deposit to enable it to enter and take possession and control of the affected portion of the
property; to demolish all improvements existing thereon; and to commence construction of the transmission
line project. It likewise prayed for the appointment of three commissioners to determine the just compensation
to be paid.
The respondents filed a motion to dismiss averred that NAPOCOR had not negotiated with them before
entering the property and that the entry was done without their consent in the process, nonetheless, they
tendered no objection to NAPOCORs entry provided it would pay just compensation not only for the portion
sought to be expropriated but for the entire property whose potential was greatly diminished, if not totally lost,
due to the project. In the pre-trial conference, the RTC directed the parties to submit the names of their
nominees to sit in the panel of commissioners within 10 days from the date of the pre-trial. The RTC
constituted the panel of three commissioners. The parties then submitted their respective objections to the
reports. The RTC adopted the recommendation contained in the joint report and ordered NAPOCOR to pay the
respondents just compensation for the whole area. The CA AFFIRMED with the MODIFICATION that
NAPOCOR shall pay only for the occupied 6,326 square meters of the subject real property at the rate of
P550.00 per square meter and to pay legal interest therefrom until fully paid. Hence, appeal by NAPOCOR to
the SC. During the pendency of the appeal, NAPOCOR filed a Motion to Defer Proceedings stating that
negotiations between the parties were going on with a view to the amicable settlement of the case. However,
On January 3, 2014, NAPOCOR filed a Manifestation and Motion to Discontinue Expropriation Proceedings,
informing that the parties failed to reach an amicable agreement and that the dismissal or discontinuance of the
expropriation proceedings was in accordance with Section 4, Rule 67 of the Rules of Court.

ISSUE: Whether or not the expropriation proceedings should be discontinued or dismissed pending appeal.

RULING:
The dismissal of the proceedings for expropriation at the instance of NAPOCOR is proper, but, conformably
with Section 4, Rule 67 of the Rules of Court, the dismissal or discontinuance of the proceedings must be upon
such terms as the court deems just and equitable.
The right of eminent domain is "the ultimate right of the sovereign power to appropriate, not only the public but
the private property of all citizens within the territorial sovereignty, to public purpose." To be valid, the taking
must be for public use. The meaning of the term "public use" has evolved over time in response to changing
public needs and exigencies. "Public use" has now been RULING to be synonymous with "public interest,"
"public benefit," and "public convenience."
Therefore, it is essential that the element of public use of the property be maintained throughout the
proceedings for expropriation. The expropriator should commit to use the property pursuant to the purpose
stated in the petition for expropriation filed, failing which, it should file another petition for the new purpose. If
not, it is then incumbent upon the expropriator to return the said property to its private owner, if the latter
desires to reacquire the same. Otherwise, the judgment of expropriation suffers an intrinsic flaw, as it would
lack one indispensable element for the proper exercise of the power of eminent domain, namely, the particular
public purpose for which the property will be devoted.
Indeed, public use is the fundamental basis for the action for expropriation; hence, NAPOCORs motion to
discontinue the proceedings is warranted and should be granted. NAPOCOR seeks to discontinue the
expropriation proceedings on the ground that the transmission lines constructed on the respondents property
had already been retired. Verily, the retirement of the transmission lines necessarily stripped the expropriation
proceedings of the element of public use. To continue with the expropriation proceedings despite the definite
cessation of the public purpose of the project would result in the rendition of an invalid judgment in favor of
the expropriator due to the absence of the essential element of public use.

Yinlu Bicol Mining Corporation vs. Trans-Asia Oil and Energy Development Corporation
G.R. No. 207942, January 12, 2015
BERSAMIN, J.:
Rights pertaining to mining patents issued pursuant to the Philippine Bill of 1902 and existing prior to
November 15, 1935 are vested rights that cannot be impaired.
FACTS:
This case involves 13 mining claims over the area located in Barrio Larap, Municipality of Jose Panganiban,
Camarines Norte, a portion of which was owned and mined by Philippine Iron Mines, Inc. (PIMI), which
ceased operations in 1975 due to financial losses. PIMI's portion (known as the PIMI Larap Mines) was sold in
a foreclosure sale to the Manila Banking Corporation (MBC) and Philippine Commercial and Industrial Bank
(PCIB, later Banco De Oro, or BD0).
In 1976, the Gold Mining Development Project Team, Mining Technology Division, The Mining Group of the
Bureau of Mines prepared a so-called Technical Feasibility Study on the Possible Re-Opening of the CPMI
Project of PIM (Mining Aspect) and the Exploration Program (Uranium Project) at Larap, Jose Panganiban,
Camarines Norte, discussed an evaluation of the ore reserve and a plan of operation to restore the mine to
normal commercial mining production and budgetary estimate should the Bureau of Mines take over and run
the PIMI Larap Mines. The Government then opened the area for exploration. In November 1978, the Benguet
Corporation-Getty Oil Consortium began exploration for uranium under an Exploration Permit of the area, but
withdrew in 1982 after four years of sustained and earnest exploration.2
Trans-Asia Oil and Energy Development Corporation (Trans-Asia) then explored the area from 1986 onwards.
In 1996, it entered into an operating agreement with Philex Mining Corporation over the area, their agreement
being duly registered by the Mining Recorder Section of Regional Office No. V of the Department of
Environment and Natural Resources (DENR). In 1997, Trans-Asia filed an application for the approval of
Mineral Production Sharing Agreement (MPSA)3 over the area in that Regional Office of the DENR, through
the Mines and Geosciences Bureau (MGB), in Daraga, Albay. The application, which was amended in 1999,
was granted on July28, 2007 under MPSA No. 252-2007-V, by which Trans-Asia was given the exclusive right
to explore, develop and utilize the mineral deposits in the portion of the mineral lands.
On August 31, 2007, Yinlu Bicol Mining Corporation (Yinlu) informed the DENR by letter that it had acquired
the mining patents of PIMI from MBC/BDO by way of a deed of absolute sale, stating that the areas covered by
its mining patents were within the areas of Trans-Asias MPSA. Based on the documents submitted by Yinlu,
four of the six transfer certificates of title (TCTs) it RULING covered four mining claims under Patent Nos. 15,
16, 17 and 18 respectively named as Busser, Superior, Bussamer and Rescue Placer Claims, with an aggregate
area of 192 hectares. The areas covered occupied more than half of the MPSA area of Trans-Asia.
On September 14, 2007, Trans-Asia informed Yinlu by letter that it would commence exploration works in
Yinlus areas pursuant to the MPSA, and requested Yinlu to allow its personnel to access the areas for the
works to be undertaken. On September 23, 2007, Yinlu replied that Trans-Asia could proceed with its
exploration works on its own private property in the Calambayungan area, not in the areas covered by its
(Yinlu) mining patents.6 This response of Yinlu compelled Trans-Asia to seek the assistance of the MGB
Regional Office V in resolving the issues between the parties. It was at that point that Trans-Asia learned that
the registration of its MPSA had been put on hold because of Yinlus request to register the deed of absolute
sale in its favor.

ISSUE: Whether the appeal was taken beyond the required period.

RULING:
Tardiness of Trans-Asias Appeal
Yinlu contends that the CA should have outrightly dismissed TransAsias appeal for being taken beyond the
required period for appealing; and that Trans-Asias filing of the second motion for reconsideration was
improper inasmuch as the motion did not cite any exceptional circumstances or reasons as required by Section
7 of the OPs Administrative Order No. 18 Series of 1987.26
The contention of Yinlu is correct.
Section 1,27 Rule 43 of the Rules of Court provides that a judgment rendered by the OP in the exercise of its
quasi-judicial function is appealable to the CA. Section 428 of the Rule states that the appeal must be taken
within 15 days "from notice of the award, judgment, final order or resolution, or from the date of its
lastpublication, if publication is required by law for its effectivity, or of the denial of petitioners motion for
new trial or reconsideration x x x."
Trans-Asia received a copy of the OP resolution dated June 29, 2010 denying the first motion for
reconsideration on July 14, 2010.29 Hence, it had until July 29, 2010 to appeal to the CA by petition for
review. However, it filed the petition for review only on May 11, 2011,30 or nearly 10 months from its receipt
of the denial. Under the circumstances, its petition for review was filed way beyond the prescribed 15-day
period.

Fortune Life Insurance Company Inc. vs. Commission on Audit

January 27, 2015 | G.R. No. 213525
BERSAMIN, J.:
The reglementary periods under Rule 42 and Rule 64 are different. In the former, the aggrieved party is
allowed 15 days to file the petition for review from receipt of the assailed decision or final order, or from
receipt of the denial of a motion for new trial or reconsideration. In the latter, the petition is filed within 30
days from notice of the judgment or final order or resolution sought to be reviewed.
FACTS:
Respondent Provincial Government of Antique and the petitioner executed a memorandum of agreement
concerning the life insurance coverage of qualified barangay secretaries, treasurers and tanod, the former
obligating P4,393,593.60 for the premium payment, and subsequently submitting the corresponding
disbursement voucher to COA-Antique for pre-audit. The latter office disallowed the payment for lack of legal
basis under Republic Act No. 7160 (Local Government Code). Respondent LGU appealed but its appeal was
denied. Consequently, the petitioner filed its petition for money claim in the COA. On November 15, 2012, the
COA issued its decision denying the petition. The petitioner received a copy of the COA decision on December
14, 2012, and filed its motion for reconsideration on January 14, 2013. However, the COA denied the motion,
the denial being received by the petitioner on July 14, 2014.
ISSUE: Whether or not Fresh period under Neypes applies to petition for certiorari under Rule 64

RULING: No
Fresh Period Rule under Neypes did not apply to the petition for certiorari under Rule 64 of the Rules of
Court
The petitioner posits that the fresh period rule applies because its Rule 64 petition is akin to a petition for
review brought under Rule 42 of the Rules of Court; hence, conformably with the fresh period rule, the period
to file a Rule 64 petition should also be reckoned from the receipt of the order denying the motion for
reconsideration or the motion for new trial. The petitioners position cannot be sustained. There is no parity
between the petition for review under Rule 42 and the petition for certiorari under Rule 64.
As to the nature of the procedures, Rule 42 governs an appeal from the judgment or final order rendered by the
Regional Trial Court in the exercise of its appellate jurisdiction. Such appeal is on a question of fact, or of law,
or of mixed question of fact and law, and is given due course only upon a prima facie showing that the
Regional Trial Court committed an error of fact or law warranting the reversal or modification of the
challenged judgment or final order. In contrast, the petition for certiorari under Rule 64 is similar to the petition
for certiorari under Rule 65, and assails a judgment or final order of the Commission on Elections
(COMELEC), or the Commission on Audit (COA). The petition is not designed to correct only errors of
jurisdiction, not errors of judgment. Questions of fact cannot be raised except to determine whether the
COMELEC or the COA were guilty of grave abuse of discretion amounting to lack or excess of jurisdiction.
The reglementary periods under Rule 42 and Rule 64 are different. In the former, the aggrieved party is allowed
15 days to file the petition for review from receipt of the assailed decision or final order, or from receipt of the
denial of a motion for new trial or reconsideration. In the latter, the petition is filed within 30 days from notice
of the judgment or final order or resolution sought to be reviewed. The filing of a motion for new trial or
reconsideration, if allowed under the procedural rules of the Commission concerned, interrupts the period;
hence, should the motion be denied, the aggrieved party may file the petition within the remaining period,
which shall not be less than five days in any event, reckoned from the notice of denial.
The petitioner filed its motion for reconsideration on January 14, 2013, which was 31 days after receiving the
assailed decision of the COA on December 14, 2012. Pursuant to Section 3 of Rule 64, it had only five days
from receipt of the denial of its motion for reconsideration to file the petition. Considering that it received the
notice of the denial on July 14, 2014, it had only until July 19, 2014 to file the petition. However, it filed the
petition on August 13, 2014, which was 25 days too late. The belated filing of the petition for certiorari under
Rule 64 on the belief that the fresh period rule should apply was fatal to the recourse. As such, the petitioner
herein should suffer the same fate for having wrongly assumed that the fresh period rule under Neypes applied.
Rules of procedure may be relaxed only to relieve a litigant of an injustice that is not commensurate with the
degree of his thoughtlessness in not complying with the prescribed procedure. Absent this reason for liberality,
the petition cannot be allowed to prosper.

Berlinda Oribello vs. Court of Appeals and Remedios Oribello

August 5, 2015 | G.R. No. 163504
BERSAMIN, J.:
To accord with the nature of the remedy of judicial partition, there are two stages defined under Rule 69 of the
Rules of Court. The first relates to the determination of the rights of the parties to the property held in common.
The second concerns the physical segregation of each party's just share in the property held in common. The
second stage need not be gone into should the parties agree on the physical partition.
FACTS:
Before RTC of La Union was an action for partition and damages involving twelve parcels of land. Eight was
in the name of Toribio Oribello, two in the names of Toribio and Rosenda Oribello, one in the names of Toribio
and and Berlinda Padilla Oribello, and one in the names of Toribio and Ma. Emilia Oribello. Toribio was twice
married. His first wife was Emilia. Toribio's marriage to Emilia was dissolved pursuant to the decision of the
Superior Court of California, County of Sacramento, U.S.A. Toribio married appellee before the municipal
mayor of Agoo, La Union. He died intestate on August 18, 1993. Instituted on May 27, 1997 by Remedios
Oribello, represented by her natural father Alfredo Selga, against appellee, the action was anchored on the
theory that appellant is an adopted daughter of Toribio. Denying that appellant is an adopted daughter of
Toribio, appellee averred in her answer that the decree of adoption was fraudulently secured by Alfredo. RTC
rendered its Judgment after trial. CA vacated and remanded the case to the lower court.

ISSUE: Whether or not respondent was able to prove that she was entitled to partition

RULING:
The respondent did not discharge her burden of proof as the plaintiff to show that she was entitled to the
partition
RTC correctly ruled against the right of respondent Remedios Oribello to demand the partition of the real
property belonging to the late Tomas Oribello on the ground that she had not substantiated her right to the
partition by preponderance of evidence. The proceeding under Rule 69 of the Rules of Court is a judicial
controversy between persons who, being co-owners or coparceners of common property, seek to secure a
division or partition thereof among themselves, giving to each one of them the part corresponding to him. The
object of partition is to enable those who own property as joint tenants, or co-owners, or tenants in common to
put an end to the joint tenancy so as to vest in each a sole estate in specific property or an allotment in the lands
or tenements.
To accord with the nature of the remedy of judicial partition, there are two stages defined under Rule 69 of the
Rules of Court. The first relates to the determination of the rights of the parties to the property held in common.
The second concerns the physical segregation of each party's just share in the property held in common. The
second stage need not be gone into should the parties agree on the physical partition.
The first stage of an action for judicial partition and/or accounting is concerned with the determination of
whether or not a co-ownership in fact exists and a partition is proper, that is, it is not otherwise legally
proscribed and may be made by voluntary agreement of all the parties interested in the property. This phase
may end in a declaration that plaintiff is not entitled to the desired partition either because a co-ownership does
not exist or a partition is legally prohibited. It may also end, on the other hand, with an adjudgment that a co-
ownership does in truth exist, that partition is proper in the premises, and that an accounting of rents and profits
received by the defendant from the real estate in question is in order. In the latter case, "the parties may, if they
are able to agree, make partition among themselves by proper instruments of conveyance, and the court shall
confirm the partition so agreed upon by all the parties." In either case, whether the action is dismissed or
partition and/or accounting is decreed, the order is a final one and may be appealed by any party aggrieved
thereby.
The second stage commences when the parties are unable to agree upon the partition ordered by the court. In
that event, partition shall be effected for the parties by the court with the assistance of not more than three (3)
commissioners. This second phase may also deal with the rendition of the accounting itself and its approval by
the Court after the parties have been accorded the opportunity to be heard thereon, and an award for the
recovery by the party or parties thereto entitled of their just shares in the rents and profits of the real estate in
question. Such an order is, to be sure, also final and appealable.
In this case, the declaration of the CA in favor of Remedios Oribello was factually unwarranted. As the
plaintiff, she had the burden of proof, as the party demanding the partition of property, to establish her right to a
share in the property by preponderance of evidence, but she failed to provide the factual basis of her right to the
partition warranted the dismissal of her claim for judicial partition. RTC correctly found that Remedios
Oribello did not satisfactorily establish her co-ownership of the properties left by the late Toribio Oribello.

The City of Iloilo, represented by Hon. Mayor Jerry Treas vs. Hon. Judge Rene Honrado, Presiding
Judge of RTC Branch 29 Iloilo City and JPV Motor Vehicle Emission Testing and Car Care Center
December 9, 2015 | G.R. No. 160399
BERSAMIN, J.:
A preliminary injunction is an order granted at any stage of an action or proceeding prior to the judgment or
final order requiring a party or a court, an agency, or a person to refrain from a particular act or acts. Its
essential role is preservative of the rights of the parties in order to protect the ability of the court to render a
meaningful decision, or in order to guard against a change of circumstances that will hamper or prevent the
granting of the proper relief after the trial on the merits.
FACTS:
The Department of Transportation and Communications (DOTC) issued Department Order No. 2002-31 with
the subject "AUTHORIZATION OF PRIVATE EMISSION TESTING CENTERS". Item No. 2 of Department
Order No. 2002-31 stated that To ensure that "cut throat" or "ruinous" competition, that may result to the
degradation of level of service of the project is avoided, authorization of PETC should strictly be rationalized
taking into consideration the vehicle population expected to be serviced in the area. As basis, one (1) PETC
lane shall be authorized for every 15,000 registered vehicles in an LTO Registering District
JPV Motor Vehicle Emission Testing and Car Care Center (JPV), a partnership authorized to operate a PETC
in Iloilo City, was granted a capacity of four lanes that could cater to 15,000 motor vehicles per lane for the
total capacity of 60,000 motor vehicles. At the time JPV filed the complaint to prevent the petitioner from
acting on the pending application for the operation of another Private Emission Testing Center (PETC) in Iloilo
City. Accordingly, JPV averred in its complaint that there was no need for another PETC because it already had
the capability to serve all the registered motor vehicles in Iloilo City pursuant to Department Order No. 2002-
31. Through its answer, the petitioner contested the injunctive relief being sought by JPV, insisting that such
relief, if issued, would result into a monopoly on the part of JPV in the operation of a PETC; that the writ of
injunction would prevent the exercise by the City Mayor of his discretionary power to issue or not to issue
business permits; and that JPV did not establish the existence of its right in esse to be protected by the writ of
injunction.
Grahar Emission Testing Center (Grahar), another PETC operator with a pending application for a
business/mayor's permit to operate its own PETC in Iloilo City, sought leave of court to intervene. Although it
allowed the intervention of Grahar on June 24, 2003, the RTC nonetheless issued the assailed order granting the
application of JPV for the writ of preliminary injunction.

ISSUE: Whether or not RTC erred in granting the application of the writ of preliminary injunction

RULING: Yes
A preliminary injunction is an order granted at any stage of an action or proceeding prior to the judgment or
final order requiring a party or a court, an agency, or a person to refrain from a particular act or acts. Its
essential role is preservative of the rights of the parties in order to protect the ability of the court to render a
meaningful decision, or in order to guard against a change of circumstances that will hamper or prevent the
granting of the proper relief after the trial on the merits. Another essential role is preventive of the threats to
cause irreparable harm or injury to a party before the litigation could be resolved. Generally, injunction, being a
preservative remedy for the protection of substantive rights or interests, is not a cause of action in itself but
merely a provisional remedy, an adjunct to a main suit.
Section 3, Rule 58 of the Rules of Court set the guidelines for when the issuance of a writ of preliminary
injunction is justified, namely: (a) when the applicant is entitled to the relief demanded, and the whole or part
of such relief consists in restraining the commission or continuance of the act or acts complained of, or in
requiring the performance of an act or acts, either for a limited period or perpetually; or (b) when the
commission, continuance or non-performance of the act or acts complained of during the litigation would
probably work injustice to the applicant; or (c) when a party, court, agency or a person is doing, threatening, or
is attempting to do, or is procuring or suffering to be done, some act or acts probably in violation of the rights
of the applicant respecting the subject of the action or proceeding, and tending to render the judgment
ineffectual. The prevailing rule is that courts should avoid issuing a writ of preliminary injunction which would
in effect dispose of the main case without trial.
Such granting of JPV's application already amounted to the virtual acceptance of JPV's alleged entitlement to
preventing the petitioner from considering and passing upon the applications of other parties to operate their
own PETC in Iloilo City based on JPV's still controversial capability to serve all the registered motor vehicles
in Iloilo City pursuant to Department Order No. 2002-31. The granting amounted to the prejudgment of the
merits of the case, something the RTC could not validly do. It apparently forgot that the function of the writ of
preliminary injunction was not to determine the merits of the case, or to decide controverted tacts, because an
interlocutory injunction was but a preliminary and preparatory order that still looked to a future final hearing,
and, although contemplating what the result of that hearing would be, it should not settle what the result should
be.
Thus, the RTC did not exercise its broad discretion soundly because it blatantly violated the right to be heard of
the petitioner, whose right to substantiate its defense of the power to regulate businesses within its territorial
jurisdiction should be fully recognized. It also violated the right to be heard of the intervenor Grahar, whose
intervention in the suit was granted only on the same date of June 24, 2003. To stress yet again, the main relief
could not be resolved without receiving the evidence of all the parties that would settle the contested facts.

Jose Sanico vs. People of the Philippines

G.R. No. 198753, March 25, 2015
BERSAMIN, J.:
The failure to file the memorandum on appeal is a ground for the RTC to dismiss the appeal ONLY in civil
cases. The same rule does not apply in criminal cases, because Section 9(c) Rule 122, imposes on the RTC the
duty to decide the appeal on the basis of the entire record of the case and of such memoranda or briefs as may
have been filed upon the submission of the appellate memoranda or briefs, or upon the expiration of the
period to file the same.
FACTS:
Petitioner Sanican and Batiquin were convicted for Violation of Section 103 of Republic Act No. 7942
otherwise known as the Philippine Mining Act of 1995. The two were criminally charged for trespassing and
theft of minerals before the MTC-CarmenSogod- Cebu. However, the accused were declared not guilty for
failure of the prosecution to prove their guilt beyond reasonable doubt. Consequently, Sanicos counsel filed a
notice of appeal in the MCTC. Then, RTC ordered Sanico to file his memorandum on appeal. Sanico did not
comply; hence, the RTC dismissed the appeal on the ground of failure to file a memorandum on appeal with
prejudice. Atty. Caete, another lawyer acting for Sanico, filed a MR vis--vis the dismissal of the appeal,
stating that Sanico had not filed the memorandum on appeal because he had been beset with problems due to
his wifes debilitating illness, as well as his first counsel, Atty. Barings own medical condition which caused
her to forget how she got this case and whom to contact as principal counsel hereof. RTC denied the MR. CA:
Affirmed. In the meantime, respondent filed an Ex Parte Motion for Entry of Judgment, which the RTC
authorized the issuance. Sanico filed an omnibus motion to recall the order and to quash the entry of judgment,
but the RTC denied. The entry of judgment was issued; the writ of execution; and that execution sales covering
several personal properties of the petitioner were made, and the certificates of sale were issued in favor of
Tenio.

ISSUE: Whether CA committed reversible error in not nullifying the RTCs order dismissing the appeal for
failure to file a memorandum

RULING:
Both RTC and CA were guilty of the prejudicial error of misapplying the Rules of Court in its dismissal of the
appeal timely made by the petitioner. In dismissing the appeal for the sole reason that he did not file the
memorandum on appeal, the RTC wrongly relied on Section 7, Rule 40 of the Rules of Court, which authorizes
the dismissal of the appeal once the appellant fails to file the memorandum on appeal. While, CA erroneously
upheld the RTC.
The failure to file the memorandum on appeal is a ground for the RTC to dismiss the appeal ONLY in civil
cases. The same rule does not apply in criminal cases, because Section 9(c) Rule 122, imposes on the RTC the
duty to decide the appeal on the basis of the entire record of the case and of such memoranda or briefs as may
have been filed upon the submission of the appellate memoranda or briefs, or upon the expiration of the period
to file the same. Hence, the dismissal of the petitioners appeal cannot be properly premised on the failure to
file the memorandum on appeal. Having timely perfected his appeal by filing the notice of appeal in the
MCTC, the petitioner was entitled to expect that the RTC would resolve his appeal in due course, whether he
filed his memorandum on appeal or not. The unwarranted dismissal of the appeal by the RTC was, therefore, an
outright denial of due process to him in a manner that occasioned severe prejudice because his conviction was
not reviewed despite his first-time appeal being a matter of right, and because his conviction was then declared
to have attained finality, causing the execution of the decision as to its civil aspect.

Sps. Benito Baysa and Victoria Baysa vs. Sps. Fidel Plantilla and Susan Plantilla
G.R. No. 159271, July 13, 2015
BERSAMIN, J.:
FACTS:
Plaintiffs-spouses executed a real estate mortgage involving their parcel of land in Cubao, Quezon City in favor
of the defendants-spouses to secure the payment of their of their indebtedness in the principal sum of
Php2,300,000. Based on the terms of the REM, the plaintiffs agreed to pay interest on the principal amount at
the rate of 2.5%/month, or P57,500.00/month. This parcel of land including the improvements is worth P15
million. They suffered business reverses and difficulty in collection so they became irregular in the monthly
payment of the agreed interest and for late payment they were charged 8% interest per month. Upon the default
of the petitioners, the respondent spouses commenced the extrajudicial foreclosure of the REM to recover from
the petitioners the total liability of P3,579, 100.00 (inclusive of the principal and the unpaid interest).
The plaintiffs sued the respondent spouses in RTC Quezon City to annul the extrajudicial foreclosure of the
REM and the public auction conducted pursuant to the extrajudicial foredosure. They alleged that all the
proceedings relevant to the extrajudicial foreclosure were null and void, pointing out that there had been no
power or authority to sell inserted in the REM or attached thereto as required by Section 1 Act No. 3135.
The RTC dismissed the case. It explained that the deed of real estate mortgage expressly states the consent of
the mortgagors to the extra-judicial foreclosure of the mortgaged property in the event of non-payment.
Aggrieved, the plaintiffs appealed. The CA promulgated the assailed judgment, affirming the validity of the
foreclosure proceedings. It was explained that the extrajudicial foreclosure was not visited with vice for failure
of the mortgagor in the mortgage deed to grant special power to sell the property in favor of the mortgagee. It
suffices that the mortgage document empowers the mortgagee to extrajudicially foreclose the property. Such
authority carries with it the grant of power to sell the property at a public auction.

ISSUE: Whether the extrajudicial foreclosure was valid despite the lack of provision in the mortgage deed
granting special power to sell to the mortgagee?

RULING:
The CA is in error when it affirms the decision of the RTC that the extra judicial foreclosure as valid under
Section 1 of Act No. 3135. Accordingly, to enable the extra judicial foreclosure of the REM of the petitioners,
the special power to sell should have been either inserted in the REM itself or embodied in a separate
instrument attached to the REM. But it is not disputed that no special power to sell was either inserted in the
REM or attached to the REM. Hence, the respondent spouses must resort to judicial foreclosure pursuant to the
procedure set forth in Rule 68 of the Rules of Court.
CAs decision was based on paragraph 13 of REM, in the event of non-payment of the entire principal and
accrued interest due under the conditions described in this paragraph, the mortgagors expressly and specifically
agree to the extra-judicial foreclosure of the mortgaged property.
The petitioners evidently agreed only to the holding of the extrajudicial foreclosure should they default in their
obligations. Their agreement was a mere expression of their amenability to extrajudicial foreclosure as the
means of foreclosing the mortgage, and did not constitute the special power or authority to sell the mortgaged
property to enable the mortgagees to recover the unpaid obligations. What was necessary was the special power
or authority to sell that authorized the respondent spouses to sell in the public auction their mortgaged property.
Since the sale of the property by virtue of the extrajudicial foreclosure would be made through the sheriff, there
must be a written authority, otherwise, the sale would be void. And pursuant to Article 1878, (5), of the Civil
Code, a special power of attorney was necessary for entering "into any contract by which the ownership of an
immovable is transmitted or acquired either gratuitously or for a valuable consideration," the written authority
must be a special power of attorney to sell.

Heirs of Arturo Garcia I vs. Municipality of Iba, Zambales

G. R. No. 162217, July 22, 2015
BERSAMIN, J.:
An appeal brings up for review any error of judgment committed by a court with jurisdiction over the subject of
the suit and over the persons of the parties, or any error committed by the court in the exercise of its
jurisdiction amounting to nothing more than an error of judgment.
FACTS:
The late Melecio R. Bueno was the tenant-farmer beneficiary of an agricultural land located in Poblacion, Iba,
Zambales. On October 18, 1999, he brought an ejectment suit in the MTC of Iba against the Municipality of
Iba, Province of Zambales, claiming that in 1983, the Municipality of Iba had constructed the public market on
a substantial portion of his land without his consent; and that his repeated demands for the Municipality of Iba
to vacate the property had remained unheeded. After due proceedings, the MTC ruled in favor of Bueno.
Thence, the Municipality of Iba filed its notice of appeal, but the MTC denied due course to the notice of
appeal. Thus, the Municipality of Iba filed its petition for certiorari in the RTC in Iba, Zambales to assail the
denial of due course by the MTC. The case was assigned to Branch 69 which ultimately granted the petition for
certiorari. The petitioners, who meanwhile substituted Bueno upon his death, moved for the reconsideration of
the judgment granting the petition for certiorari, but the RTC denied their motion for reconsideration.
Aggrieved, the petitioners appealed to the CA by petition for review under Rule 42 of the Rules of Court.
ISSUE: Whether the dismissal is proper for being not the proper mode of appeal

RULING:
An appeal brings up for review any error of judgment committed by a court with jurisdiction over the subject of
the suit and over the persons of the parties, or any error committed by the court in the exercise of its jurisdiction
amounting to nothing more than an error of judgment. It is very crucial to be cognizant of the different modes
of appeal. Pursuant to Section 2, Rule 41 of the Rules of Court which states that xxx the appeal to the Court of
Appeals in cases decided by the Regional Trial Court in the exercise of its original jurisdiction shall be taken by
filing a notice of appeal xxxin conjunction with Section 3 and Section 4 of Rule 41, the petitioners should
have filed a notice of appeal in the RTC within the period of 15 days from their notice of the judgment of the
RTC, and within the same period should have paid to the clerk of the RTC the full amount of the appellate
court docket and other lawful fees. The filing of the notice of appeal within the period allowed by the Rules sets
in motion the remedy of ordinary appeal because the appeal is deemed perfected. It is upon the perfection of the
appeal filed in due time, and the expiration of the time to appeal of the other parties that the RTC shall lose
jurisdiction over the case. On the other hand, the non-payment of the appellate court docket fee within the
reglementary period as required by Section 4, is both mandatory and jurisdictional, the non compliance with
which is fatal to the appeal, and is a ground to dismiss the appeal under Section 1, ( c), Rule 50 of the Rules of
Court. The compliance with these requirements was the only way by which they could have perfected their
appeal from the adverse judgment of the RTC. In contrast, an appeal filed under Rule 42 is deemed perfected as
to the petitioner upon the timely filing of the petition for review before the CA, while the RTC shall lose
jurisdiction upon perfection thereof and the expiration of the time to appeal of the other parties.
The appeal by notice of appeal under Rule 41 is a matter or right, but the appeal by petition for review under
Rule 42 is a matter of discretion. The procedure taken after the perfection of an appeal under Rule 41 also
significantly differs from that taken under Rule 42. Under Section 10 of Rule 41, the clerk of court of the RTC
is burdened to immediately undertake the transmittal of the records by verifying the correctness and
completeness of the records of the case; the transmittal to the CA must be made within 30 days from the
perfection of the appeal. This requirement of transmittal of the records does not arise under Rule 42, except
upon order of the CA when deemed necessary. As borne out in the foregoing, the petitioners' resort to the
petition for review under Rule 42 was wrong. Hence, the CA did not err in denying due course to the petition
for review. The plea for liberality is unworthy of any sympathy from the Court. As the parties invoking the
privilege, the petitioners should have faithfully complied with the requirements of the Rules of Court. Their
failure to do so forfeited their privilege to appeal.

Bpi Family Savings Bank vs. Sps. Benedicto & Teresita Yujuico
G.R. No. 175796, July 22, 2015
BERSAMIN, J.:
An action to recover the deficiency after extrajudicial foreclosure of a real property mortgage is a personal
action because it does not affect title to or possession of real property, or any interest therein.
FACTS:
City of Manila filed a complaint against the respondents for the expropriation of five parcels of land located in
Tondo, Manila and registered in the name of respondent Teresita Yujuico. Two of the parcels of land, covered
by Transfer Certificate of Title (TCT) No. 261331 and TCT No. 261332, were previously mortgaged to
Citytrust Banking Corporation, the petitioners predecessor-in-interest, under a First Real Estate Mortgage
Contract. Regional Trial Court in Manila (Manila RTC) rendered its judgment declaring the five parcels of land
expropriated for public use. The judgment became final and executory on January 28, 2001 and was entered in
the book of entries of judgment. The petitioner subsequently filed a Motion to Intervene in Execution with
Partial Opposition to Defendants Request to Release, but the RTC denied the motion for having been filed
out of time. Hence, the petitioner decided to extrajudicially foreclose the mortgage constituted on the two
parcels of land subject of the respondents loan. After holding the public auction, the sheriff awarded the two
lots to the petitioner as the highest bidder at P10,000,000.00. Claiming a deficiency amounting to
P18,522.155.42, the petitioner sued the respondents to recover such deficiency in the Makati RTC (Civil Case
No. 03-450). The respondents moved to dismiss the complaint on several grounds, namely: that the suit was
barred by res judicata; that the complaint stated no cause of action; and that the plaintiffs claim had been
waived, abandoned, or extinguished.
ISSUE: Whether or not CA erred when it ruled the case filed by BPI should be dismissed on the ground of
improper venue

RULING:
It is basic that the venue of an action depends on whether it is a real or a personal action. According to Section
1, Rule 4 of the Rules of Court, a real action is one that affects title to or possession of real property, or an
interest therein. The real action is to be commenced and tried in the proper court having jurisdiction over the
area wherein the real property involved, or a portion thereof, is situated. In contrast, the Rules of Court declares
all other actions as personal actions. The venue of a personal action is the place where the plaintiff or any of the
principal plaintiffs resides, or where the defendant or any of the principal defendants resides, or in the case of a
nonresident defendant where he may be found, at the election of the plaintiff.
Based on the distinctions between real and personal actions, an action to recover the deficiency after the
extrajudicial foreclosure of the real property mortgage is a personal action, for it does not affect title to or
possession of real property, or any interest therein.
Given the foregoing, the petitioner correctly brought the case in the Makati RTC because Makati was the place
where the main office of the petitioner was located.
Moreover the Court agreed with the RTC that it would be improper to dismiss the case on the ground of
improper venue, assuming that the venue had been improperly laid, considering that the respondents had not
raised such ground in their Motion to Dismiss. We underscore that in civil proceedings, venue is procedural,
not jurisdictional, and may be waived by the defendant if not seasonably raised either in a motion to dismiss or
in the answer. Section 1, Rule 9 of the Rules of Court thus expressly stipulates that defenses and objections not
pleaded either in a motion to dismiss or in the answer are deemed waived.

Grace Insigne et al vs. Abra Valley Colleges Inc.

G.R. No. 204089, July 29, 2015
BERSAMIN, J.:
In civil cases, the party having the burden of proof must establish his case by a preponderance of evidence.
Thus, the party, whether the plaintiff or the defendant, who asserts the affirmative of an issue bears the onus to
prove his assertion in order to obtain a favorable judgment. From the plaintiff the burden to prove his positive
assertions never parts.
FACTS:
Petitioners Grace Borgoa Insigne, Diosdado Borgoa, Osbourne Borgoa, Imelda Borgoa Rivera, Aristotle
Borgoa are siblings of the full blood. Respondent Francis Borgoa (Francis) is their older half-blood brother.
The petitioners are the children of the late Pedro Borgoa (Pedro) by his second wife, Teresita Valeros, while
Francis was Pedros son by his first wife, Humvelina Avila. In his lifetime, Pedro was the founder, president
and majority stockholder of respondent Abra Valley Colleges, Inc. (Abra Valley), a stock corporation. After
Pedros death, Francis succeeded him as the president of Abra Valley. On March 26, 2002, the petitioners,
along with their brother Romulo Borgoa and Elmer Reyes, filed a complaint (with application for preliminary
injunction) and damages in the RTC against Abra Valley praying, among others, that the RTC direct Abra
Valley to allow them to inspect its corporate books and records, and the minutes of meetings, and to provide
them with its financial statements. Due to Abra Valleys failure to file its responsive pleading within the
reglementary period provided in the Interim Rules of Procedure Governing Intra-Corporate Controversies, the
RTC rendered judgment in favor of the petitioners.

ISSUE: Whether the Court is correct when it ruled that the burden of proving the stock ownership lies with the
petitioners? Whether the lower court properly dismissed the case on the ground of the petitioners failure to
comply with the order issued by the RTC to produce stock certificates?

RULING:
In civil cases, the party having the burden of proof must establish his case by a preponderance of evidence.
Thus, the party, whether the plaintiff or the defendant, who asserts the affirmative of an issue bears the onus to
prove his assertion in order to obtain a favorable judgment. From the plaintiff the burden to prove his positive
assertions never parts. Yet, for the defendant, an affirmative defense is one that is not a denial of an essential
ingredient in the plaintiffs cause of action, but rather one that, if established, will be a good defense i.e., an
"avoidance" of the claim. Being the parties who filed the Motion for Preliminary Hearing of Special and
Affirmative Defenses, the respondents bore the burden of proof to establish that the petitioners were not
stockholders of Abra Valley. The respondents assertion therein, albeit negative, partook of a good defense that,
if established, would result to their avoidance of the claim.
To establish their stock ownership, the petitioners actually turned over to the trial court through their
Compliance and Manifestation submitted various documents showing their ownership of Abra Valleys shares,
specifically: the official receipts of their payments for their subscriptions of the shares of Abra Valley; and the
copies duly certified by the Securities and Exchange Commission (SEC) stating that Abra Valley had issued
shares in favor of the petitioners, such as the issuance of part of authorized and unissued capital stock; the
secretarys certificate; and the general information sheet. They were able to show that the respondents had
allowed the petitioners to become members of the Board of Directors according to the Minutes of the Annual
Meeting of Directors and Stockholders of the Abra Valley College of January 29, 1989. Section 23 of the
Corporation Code requires every director to be the holder of at least one share of capital stock of the
corporation of which he is a director, the respondents would not have then allowed any of the petitioners to be
elected to sit in the Board of Directors as members unless they believed that the petitioners so elected were not
disqualified for lack of stock ownership.
Under the circumstances, the dismissal of the case on the basis that "the documents presented are not Stock
Certificates as boldly announced by the plaintiffs counsel, hence, plaintiffs failed to comply with the order of
the Court dated March 8, 2010" was unwarranted and unreasonable. Although Section 3, Rule 17 of the Rules
of Court expressly empowers the trial court to dismiss the complaint motu proprio or upon motion of the
defendant if, for no justifiable cause, the plaintiff fails to comply with any order of the court, the power to
dismiss is not to wielded indiscriminately, but only when the non-compliance constitutes a willful violation of
an order of consequence to the action. As we have seen, however, the dismissal of the case by virtue of Section
3, Rule 17 of the Rules of Court should be undone because the petitioners production of the stock certificates
was rendered superfluous by their submission of other competent means of establishing their shareholdings in
Abra Valley.

Nilo Chiongian vs. Victoria Benitez-Lirio et al

G.R. No. 162692, August 26, 2015
BERSAMIN, J.:
Pursuant to Sec. 2(a), Rule 41, the proper mode of appealing a judgment or final order in special proceedings
is by notice of appeal and record on appeal. Under Section 3 of Rule 41, a party who wants to appeal a
judgment or final order in special proceedings has 30 days from notice of the judgment or final order within
which to perfect an appeal because he will be filing not only a notice of appeal but also a record on appeal that
will require the approval of the trial court with notice to the adverse party. The period of appeal shall be
interrupted by a timely motion for new trial or reconsideration.
FACTS:
The late Vicente Benitez was married to Isabel Chipongian, the petitioner's sister. Isabel had predeceased
Vicente, who died on November 13, 1989. The couple had no offspring. On July 20, 1982, after the death of
Isabel, Vicente and the petitioner had executed a deed of extrajudicial settlement respecting the estate of Isabel,
whereby the latter waived all his rights to the estate of Isabel in favor of Vicente. According to the petitioner,
however, Vicente executed an affidavit on the same date whereby he affirmed that the waiver did not extend to
the paraphernal properties of Isabel. Upon the death of Vicente, Victoria Benitez Lirio (Victoria), a sister of
Vicente, and Feodor Benitez Aguilar (Feodor), a nephew of Vicente, initiated proceedings for the settlement of
the estate of Vicente in RTC. RTC appointed Feodor the administrator of Vicentes estate and issued the letters
of administration to Feodor. The petitioner intervened in Special Proceedings No. SP-797. Feodor countered
with the request that he be allowed to continue to administer all the properties left by Vicente, including the
paraphernal properties of Isabel. Petitioner specifically moved for the exclusion of the paraphernal properties of
Isabel from Vicentes estate. However, he withdrew the motion even before the RTC could rule on it. Instead,
he filed a Motion for Leave to Intervene and to Admit Complaint-in-Intervention.

ISSUE: Whether or not the petitioner timely filed his appeal

RULING:
First, Section 1 of Rule 41 enunciates the final judgment rule by providing that 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." In the context of the final judgment rule, Section 1 of Rule 109 does not limit the
appealable orders and judgments in special proceedings to the final order or judgment rendered in the main
case, but extends the remedy of appeal to other orders or dispositions that completely determine a particular
matter in the case, such as when it allows or disallows, in whole or in part, any claim against the estate of a
deceased person, or any claim presented on behalf of the estate in offset to a claim against it; and when it
constitutes, in proceedings relating to the settlement of the estate of a deceased person, or the administration of
a trustee or guardian, a final determination in the lower court of the rights of the party appealing, except that no
appeal shall be allowed from the appointment of a special administrator. In the case at bar, when the petitioner
intervened in the Special Proceedings, his complaint-in-intervention, once admitted by the RTC, became part of
the main case, rendering any final disposition thereof subject to the rules specifically applicable to special
proceedings, including Rule 109 of the Rules of Court. The dismissal of the petitioner's intervention constituted
"a final determination in the lower court of the rights of the party appealing," that is, his right in the paraphernal
properties of his deceased sister. As such, it fell under Section 1 or Rule 109, because it had the effect of
disallowing his claim against the estate of Vicente, and because it was a final determination in the trial court of
his intervention. Conformably, the dismissal was the proper subject of an appeal in due course by virtue of its
nature of completely disposing of his intervention.
Further, pursuant to Sec. 2(a), Rule 41, the proper mode of appealing a judgment or final order in special
proceedings is by notice of appeal and record on appeal. Under Section 3 of Rule 41, a party who wants to
appeal a judgment or final order in special proceedings has 30 days from notice of the judgment or final order
within which to perfect an appeal because he will be filing not only a notice of appeal but also a record on
appeal that will require the approval of the trial court with notice to the adverse party. The period of appeal
shall be interrupted by a timely motion for new trial or reconsideration. In this case, for the petitioner,
therefore, the period for perfecting the appeal by record on appeal was 30 days from notice of the final order
dismissing the intervention. The start of the period of 30 days happened on September 18, 1998, the date when
his counsel received the decision dismissing his intervention. However, the entire time from the filing of his
Motion for Reconsideration on October 2, 1998 until his receipt of the denial of the Motion for Reconsideration
on March 18, 1999 should be deducted from the reckoning of the period to perfect his appeal. Considering that
the petitioner did not submit a record on appeal in accordance with Section 3 of Rule 41, he did not perfect his
appeal of the judgment dismissing his intervention. As a result, the dismissal became final and immutable.

Rogelio Baronda vs. Court of Appeals

G.R. No. 161006, October 14, 2015
BERSAMIN, J.:
The reinstatement aspect of the Voluntary Arbitrator's award or decision is immediately executory from its
receipt by the parties.
FACTS:
Respondent Hideco Sugar Milling Co., Inc. (HIDECO) employed the petitioner as a mud press truck driver
with a daily salary of P281.00. He hit HIDECOs transmission lines while operating a dump truck, causing a
total factory blackout from 9:00 pm until 2:00 am of the next day. Power was eventually restored but the
restoration cost HIDECO damages totaling P26,481.11. Following the incident, HIDECO served a notice of
offense requiring him to explain the incident within three days from notice. He complied. Thereafter, the
management conducted its investigation, and, finding him guilty of negligence, recommended his dismissal.
Resident manager served a termination letter and informed him of the decision to terminate his employment
effective at the close of office hours of that day. Hence, HIDECO no longer allowed him to report to work on
the next day. Petitioner, along with another employee also dismissed by HIDECO, filed in the Office of the
Voluntary Arbitrator of the National Conciliation and Mediation Board in Tacloban City a complaint for illegal
dismissal against HIDECO. Voluntary Arbitrator Antonio C. Lopez, Jr. handled the case and eventually
rendered his decision by finding the petitioners dismissal illegal, and ordering his reinstatement. Petitioner
filed his manifestation with motion for the issuance of the writ of execution in the Office of the Voluntary
Arbitrator, praying for the execution of the decision, and insisting on being entitled to backwages and other
benefits. HIDECO opposed the petitioners motion for execution and simultaneously presented its own motion
for execution to enforce the decision of the Voluntary Arbitrator directing the petitioner to pay the actual
damages amounting to P26, 484.41. The Voluntary Arbitrator dismissed petitioners motion and granted
HIDECOs motion for execution. Petitioner filed another motion for execution praying that a writ of execution
requiring HIDECO to pay to him unpaid waged, 13th month pay and bonuses; which was granted by the
Voluntary Arbitrator. HIDECO instituted a special civil action for certiorari in the Court of Appeals averring
that the Voluntary Arbitrator had acted with grave abuse of discretion amounting to lack or excess of
jurisdiction.
ISSUE: Whether or not petition for certiorari was the proper remedy.

RULING:
HIDECOs proper recourse was to appeal by petition for review and not petition for certiorari. Even if the error
sought to be reviewed concerned grave abuse of discretion on the part of the Voluntary Arbitrator, the remedy
was an appeal in due course by filing the petition for review within 10 days from notice of the award or
decision. This is because certiorari, as an extraordinary remedy, was available only when there was no appeal
or any plain, speedy and adequate remedy in the ordinary, course of law. The justification for HIDECOs
resort to the extraordinary equitable remedy of certiorari did not exist due to the availability of appeal, or other
ordinary remedies in law to which HIDECO as the aggrieved party could resort.
Although it is true that certiorari cannot be substitute for a lost appeal, and that either remedy was not an
alternative of the other, we have at times permitted the resort to certiorari despite availability of appeal or of
any plain, speedy and adequate remedy in the ordinary course of law in exceptional situations, such as: 1. When
the remedy of certiorari is necessary to prevent irreparable damages and injury to a party; 2. Where the trial
judge capriciously and whimsically exercised his judgment; 3. Where there may be danger of a failure of
justice; 4. Where appeal would be slow, inadequate and insufficient; 5. Where the issue raised is one purely of
law; 6. Where public interest is involved; and 7. In case of urgency. In this case, HIDECO did not establish
that its case came within any of the aforestated exceptional situations.

National Housing Authority vs. Ernesto Roxas

G.R. No. 171953, October 21, 2015
BERSAMIN, J.:
The National Housing Authority (NHA), a government-owned and controlled corporation created and existing
under Presidential Decree No. 757,1 may sue and be sued. However, no court should issue a writ of execution
upon any mo'netary judgment rendered against the NHA unless such monetary judgment is first submitted to
and passed upon by the Commission on Audit (COA).
FACTS:
The NHA is charged, among others, with the development of the Dagat-dagatan Development Project in
Navotas, Manila. Roxas applied for commercial lots in the said project with an area of 176 sq. m. for the use of
his business of buying and selling gravel, sand and cement products. The NHA approved his application and
issued the order or payment respecting the lots. Later on, NHA issued the notice of award for the lots in favor
of Roxas. The latter completed his payment for the subject lots on December 20, 1991. NHA conducted a final
subdivision project survey, causing the increase in the area of the subject lots from 176 to 320 sq. m. The NHA
informed Roxas about the increase in the area of the subject lots, and approved the award of additional area of
144 sq. m. to him at P3,500.00/sq. m. Although Roxas desired to purchase the increased area, the purchase
must be in accordance with the terms and conditions contained in the order of payment and notice of award
issued to him.
After NHA rejected his appeal, Roxas commenced an action for specific performance and damages, with prayer
for the issuance of a writ of preliminary injunction. He amended the complaint to compel the NHA to comply
with the terms and conditions of the order of payment and the notice of award.
NHA countered that Roxas prayer to include in the original contract the increase in lot measurement of 144 sq.
m. was contrary to its existing rules and regulation and at the very least, his right in the additional area was
limited only to first refusal. The RTC ruled against NHA. Roxas filed his motion for the issuance of the writ of
execution which was granted by the RTC. NHA filed its petition for certiorari. It contends that the money
judgment awarded to Roxas could not be covered by motion for execution but should have been first filed in
the COA.The CA dismissed NHAs petition and ruled that NHA was a governmentowned and controlled
corporation whose funds were not exempt from garnishment or execution; and ruled that Roxas did not need to
first file his claim in the COA.

ISSUE: Whether or not the money judgment awarded in favor of Roxas should be first filed before the COA.

RULING:
The audit jurisdiction of the CIA extends to all government-owned or controlled corporations, their
subsidiaries and other self-governing boards, commission or agencies of the Government, as well as to all non-
governmental entities subsidized by the Government, or funded by donations through the Government, or
required to pay levies or government share, or for which the Government has put up a counterpart fund, or
those of partly funded by the Government.
There is no question that the NHA could sue and be sued, and thus could be held liable under the judgment
rendered against it. But the universal rule remains to be that the State, although it gives its consent to be sued
either by general or special law, may limit the claimants action only up to the completion of proceedings
anterior to the stage of execution.
Government funds and property may not be seized pursuant to writs of execution or writs of garnishment to
satisfy judgments of the court. The functions and public services of the State cannot be allowed to be paralyzed
or disrupted by the diversion of public fund from their legitimate and specific objects, and as appropriated by
law. The disbursements of public funds must be covered by the corresponding appropriation as required by law.

Fernando Medical Enterprises Inc. vs. Wesleyan University Philippines

G.R. No. 207970, January 20, 2016
BERSAMIN, J.
The trial court may render a judgment on the pleadings upon motion of the claiming party when the defending
party's answer fails to tender an issue, or otherwise admits the material allegations of the adverse party's
pleading. For that purpose, only the pleadings of the parties in the action are considered. It is error for the
trial court to deny the motion for judgment on the pleadings because the defending party's pleading in another
case supposedly tendered an issue of fact.
FACTS:
The petitioner, a domestic corporation dealing with medical equipment and supplies, delivered to and installed
medical equipment and supplies at the respondents hospital.Tthe respondent paid only P67,357,683.23 of its
total obligation of P123,901,650.00, leaving unpaid the sum of P54,654,195.54. However, on February 11,
2009, the petitioner and the respondent, respectively represented by Rafael P. Fernando and Guillermo T.
Maglaya, Sr., entered into an agreement, whereby the former agreed to reduce its claim to only P50,400,000.00,
and allowed the latter to pay the adjusted obligation on installment basis within 36 months. Respondent notified
the petitioner that its new administration had reviewed their contracts and had found the contracts defective and
rescissible due to economic prejudice or lesion; and that it was consequently declining to recognize the
February 11, 2009 agreement because of the lack of approval by its Board of Trustees. Due to the respondents
failure to pay as demanded, the petitioner filed its complaint for sum of money in the RTC. The respondent
moved to dismiss the complaint upon the following grounds, namely: (a) lack of jurisdiction over the person of
the defendant; (b) improper venue; (c) litis pendentia; and (d) forum shopping, which was denied. Petitioner
filed its Motion for Judgment Based on the Pleadings, stating that the respondent had admitted the material
allegations of its complaint and thus did not tender any issue as to such allegations. The respondent opposed the
Motion for Judgment Based on the Pleadings, arguing that it had specifically denied the material allegations in
the complaint. RTC issued the order denying the Motion for Judgment Based on the Pleadings of the petitioner.
CA affirmed.

ISSUE: Did the CA commit reversible error in affirming the RTCs denial of the petitioners motion for
judgment on the pleadings?

RULING:
The rule on judgment based on the pleadings is Section 1, Rule 34 of the Rules of Court. The essential query in
resolving a motion for judgment on the pleadings is whether or not there are issues of fact generated by the
pleadings. Whether issues of fact exist in a case or not depends on how the defending partys answer has dealt
with the ultimate facts alleged in the complaint. The defending partys answer either admits or denies the
allegations of ultimate facts in the complaint or other initiatory pleading. The allegations of ultimate facts the
answer admit, being undisputed, will not require evidence to establish the truth of such facts, but the allegations
of ultimate facts the answer properly denies, being disputed, will require evidence. The answer admits the
material allegations of ultimate facts of the adverse partys pleadings not only when it expressly confesses the
truth of such allegations but also when it omits to deal with them at all. The controversion of the ultimate facts
must only be by specific denial. Section 10, Rule 8 of the Rules of Court recognizes only three modes by which
the denial in the answer raises an issue of fact. The first is by the defending party specifying each material
allegation of fact the truth of which he does not admit and, whenever practicable, setting forth the substance of
the matters upon which he relies to support his denial. The second applies to the defending party who desires to
deny only a part of an averment, and the denial is done by the defending party specifying so much of the
material allegation of ultimate facts as is true and material and denying only the remainder. The third is done by
the defending party who is without knowledge or information sufficient to form a belief as to the truth of a
material averment made in the complaint by stating so in the answer. Any material averment in the complaint
not so specifically denied are deemed admitted except an averment of the amount of unliquidated damages.
In the case of a written instrument or document upon which an action or defense is based, which is also known
as the actionable document, the pleader of such document is required either to set forth the substance of such
instrument or document in the pleading, and to attach the original or a copy thereof to the pleading as an
exhibit, which shall then be deemed to be a part of the pleading, or to set forth a copy in the pleading. The
adverse party is deemed to admit the genuineness and due execution of the actionable document unless he
specifically denies them under oath, and sets forth what he claims to be the facts, but the requirement of an oath
does not apply when the adverse party does not appear to be a party to the instrument or when compliance with
an order for an inspection of the original instrument is refused.
In Civil Case No. 09-122116, the respondent expressly admitted paragraphs no. 2, 3, 4, 5, 9 and 10 of the
complaint. The admission related to the petitioners allegations on: (a) the four transactions for the delivery and
installation of various hospital equipment; (b) the total liability of the respondent; (c) the payments made by the
respondents; (d) the balance still due to the petitioner; and (e) the execution of the February 11, 2009
agreement. The complaint properly alleged the substance of the February 11, 2009 agreement, and contained a
copy thereof as an annex. Upon the express admission of the genuineness and due execution of the February
11, 2009 agreement, judgment on the pleadings became proper.
The respondent denied paragraphs no. 6, 7 and 8 of the complaint for lack of knowledge or information
sufficient to form a belief as to the truth or falsity thereof, inasmuch as the alleged transactions were undertaken
during the term of office of the past officers of defendant Wesleyan University Philippines. Was the manner of
denial effective as a specific denial? No. It is settled that denials based on lack of knowledge or information of
matters clearly known to the pleader, or ought to be known to it, or could have easily been known by it are
insufficient, and constitute ineffective or sham denials. Lastly, we should emphasize that in order to resolve the
petitioners Motion for Judgment Based on the Pleadings, the trial court could rely only on the answer of the
respondent filed in Civil Case No. 09-122116. Under Section 1, Rule 34 of the Rules of Court, the answer was
the sole basis for ascertaining whether the complaints material allegations were admitted or properly denied.

Tung Hui Chung and Tong Hong Chung vs. Shih Chi Huang
G.R. No. 170679, March 9, 2016
BERSAMIN, J.:
A compromise agreement has the effect and authority of res judicata between the parties, and is immediately
final and executory, unless rescinded upon grounds that vitiate consent. Once stamped with judicial
imprimatur, it is more than a mere contract between the parties. Any effort to annul the judgment based on
compromise on the ground of extrinsic fraud must proceed in accordance with Rule 47 of the Rules of Court.
FACTS:
On September 6, 2001, the petitioners, both Australian citizens, filed in the Regional Trial Court (RTC),
Branch 49, in Manila an amended complaint6 to recover from the respondent a sum of money and damages
(with prayer for a writ of attachment). The suit, docketed as Civil Case No. 01-101260, involved the contract to
sell dated October 30, 2000, whereby the respondent, as the vendor, undertook to deliver to the petitioners, as
the vendees, shares of stock worth P10,606,266.00 in Island Information and Technology, Inc. (the
corporation), a publicly listed corporation. The petitioners alleged that under the provisions of the contract to
sell, the equivalent shares of stock in the corporation should be their value as of February 22, 2001, the date
corresponding to the five-day period prior to the end of the fourth month after October 30, 2000, the date of the
signing of the contract to sell; that according to the Philippine Stock Exchange, Inc. (PSEI), the shares of the
corporation, which stood at P0.05 for the open, high, low and closing prices on February 22, 2001, had the
equivalent of 177,925,320 shares of stock; and that the respondent failed to deliver the shares of stock
corresponding to the agreed amount on the date fixed by the contract. RTC issued an amended order granting
the petitioners application for the writ of preliminary attachment. Later on, the parties filed their Joint Motion
for Approval of a Compromise Agreement. The compromise agreement, which was signed by the respondent
and by Eduard Alcordo, as the attorney-in-fact of the petitioners, with the assistance of their respective
counsels, stipulating that the parties agreed to settle their respective claims and counterclaims, and the
respondent acknowledged therein his obligation, was filed and granted by the Court. But the respondent did not
pay the second installment despite demand. Instead, he filed in the CA a petition for annulment of judgment
thereby seeking to nullify the amended order granting the application for the writ of attachment, and the order
approving the compromise agreement.

ISSUE: Whether or not judicial compromise agreement could no longer be assailed through certiorari

RULING:
Compromise agreement is a contract whereby the parties make reciprocal concessions to avoid litigation or to
put an end to one already commenced. It attains the authority and effect of res judicata upon the parties upon its
execution, and becomes immediately final and executory, unless rescinded by grounds which vitiate consent.
Once stamped with judicial imprimatur, it ceases to be a mere contract between the parties, and becomes a
judgment of the court, to be enforced through writ of execution. The CA did not recognize that what it was
asked to annul and set aside was no longer the compromise agreement of the parties but already the judgment
based on the compromise agreement. The failure to recognize led the CA into granting the unprecedented relief
of annulling the compromise agreement on the ground of fraud and lack of consent. In so doing, the CA acted
without jurisdiction. First of all, the action before the CA was a special civil action for certiorari that had been
brought on March 7, 2005, which was way beyond the period of 60 days from the rendition of the judgment
based on the compromise agreement on October 20, 2003. With this stamp of judicial approval, the
compromise agreement became more than a mere contract of the parties. The judicially approved agreement
was thereby turned into a final judgment, immutable and unalterable, regardless of whether or not it rested on
erroneous conclusions of fact and law, and regardless of whether the change would be by the court that
rendered it or the highest court of the land.

If the ground of the respondent to assail the judgment based on the compromise agreement was extrinsic fraud,
his action should be brought under Rule 47 of the Rules of Court. Under Section 2 of Rule 47, the original
action for annulment may be based only on extrinsic fraud or lack of jurisdiction, but extrinsic fraud, to be valid
ground, should not have been availed of, or could not have been availed of in a motion for new trial or petition
for relief. If the ground relied up is extrinsic fraud, the action must be filed within four years from the discovery
of the extrinsic fraud; if the ground is lack of jurisdiction, the action must be brought before it is barred by
laches or estoppels. Regardless of the ground for the action, the remedy under Rule 47 is to be availed of only
if the ordinary remedies of new trial, appeal, petition for relief or other appropriate remedies are no longer
available through no fault of the petitioner. Ostensibly, the respondent could have availed himself of the
petition for relief from judgment under Rule 38 of the Rules of Court. Hence, his failure to resort to such
remedy precluded him from availing himself of the remedy to annul the judgment based on the compromise
agreement.

Andrew Fyfe et al vs. Philippine Airlines, Inc

G.R . NO. 160071, June 6, 2016
BERSAMIN, J.
There was sufficient compliance with the rule on verification and certification against forum shopping. The
SPAs individually signed by the petitioners vested in their counsel the authority, among others, "to do and
perform on my behalf any act and deed relating to the case, which it could legally do and perform, including
any appeals or further legal proceedings."
FACTS:
In 1998, the respondent underwent rehabilitation proceedings in the Securities and Exchange Commission
(SEC), which issued an order dated July 1, 1998 decreeing, among others, the suspension of all claims for
payment against the respondent. To convince its creditors to approve the rehabilitation plan, the respondent
decided to hire technical advisers with recognized experience in the airline industry. This led the respondent
through its then Director Luis Juan K. Virata to consult with people in the industry, and in due course came to
meet Peter W. Foster, formerly of Cathay Pacific Airlines. Foster, along with Michael R. Scantlebury,
negotiated with the respondent on the details of a proposed technical services agreement. Foster and
Scantlebury subsequently organized Regent Star Services Ltd. (Regent Star) under the laws of the British
Virgin Islands. Petitioner and respondent entered into Technical Service Agreement (TSA) wherein under its
terms, penalties shall be payable by the terminating party. Respondent sent notice to petitioner terminating the
TSA for lack of confidence and wants to offset the penalty from its advance payment. Petitioner denied the
refund and claim for offset and proposed to submit the issue to arbitration pursuant to their TSA. The
Philippine Dispute Resolution Center, Inc. rendered judgment in favor to the petitioner. Respondent filed an
Application to Vacate Arbitral Award in RTC Makati in view of the SEC Order that respondent is under a state
of suspension of payment. The petitioner filed MTD on the ground that (a) lack of jurisdiction over the persons
of the petitioners due to the improper service of summons; (b) the application did not state a cause of action;
and (c) the application was an improper remedy because the respondent should have filed an appeal in the CA
pursuant to Rule 43 of the Rules of Court. RTC granted the application to vacate arbitral award. Petitioner
appealed to CA by notice of appeal. Respondent moved to dismiss the appeal on the ground that Section 29 of
arbitration law limited appeals to a review on certiorari upon questions of law. CA rendered judgment in favor
of respondent. Hence this appeal by the petitioners.

ISSUE: whether or not the petition for review should be dismissed for containing a defective
verification/certification;
whether or not the CA erred in dismissing the appeal of the petitioners for being an inappropriate remedy.

RULING:
There was sufficient compliance with the rule on verification and certification against forum shopping. The
SPAs individually signed by the petitioners vested in their counsel the authority, among others, "to do and
perform on my behalf any act and deed relating to the case, which it could legally do and perform, including
any appeals or further legal proceedings." The authority was sufficiently broad to expressly and specially
authorize their counsel, Atty. Ida Maureen V. Chao-Kho, to sign the verification/certification on their behalf.
The purpose of the verification is to ensure that the allegations contained in the verified pleading are true and
correct, and are not the product of the imagination or a matter of speculation; and that the pleading is filed in
good faith. This purpose was met by the verification/certification made by Atty. Chao-Kho in behalf of the
petitioners.

Appealing the RTC order vacating an arbitral award

CA correctly dismissed the appeal of the petitioners because pursuant to Section 2, Rule 41 of the Rules of
Court an appeal of questions of law arising in the courts in the first instance is by petition for review on
certiorari under Rule 45. On February 4, 2004. Republic Act No. 9285 (Alternative Dispute Resolution Act of
2004) was passed by Congress, and was approved by the President on April 2, 2004. Pursuant to Republic Act
No. 9285, the Court promulgated on September 1, 2009 in A.M. No. 07-11-08-SC the Special Rules of Court
on Alternative Dispute Resolution, which are now the present rules of procedure governing arbitration. Among
others, the Special Rules of Court on Alternative Dispute Resolution requires an appeal by petition for review
to the CA of the final order of the R TC confirming, vacating, correcting or modifying a domestic arbitral
award. Although the Special Rules of Court on Alternative Dispute Resolution provides that the appropriate
remedy from an order of the RTC vacating a domestic arbitral award is an appeal by petition for review in the
CA, not an ordinary appeal under Rule 41 of the Rules of Court, the Court cannot set aside and reverse the
assailed decision on that basis because the decision was in full accord with the law or rule in force at the time
of its promulgation.

CRIMINAL PROCEDURE
Anna Patula vs. People of the Philippines
G.R. No. 164457, April 11, 2012
BERSAMIN, J.:
An accused cannot be convicted of an offense that is not clearly charged in the complaint or information. To
convict him of an offense other than that charged in the complaint or information would be violative of the
Constitutional right to be informed of the nature and cause of the accusation.
FACTS:
Petitioner was charged with estafa in the Regional Trial Court (RTC) in Dumaguete City. The said accused,
being then a saleswoman of Footluckers Chain of Stores, Inc., Dumaguete City, having collected and received
the total sum of P131,286.97 from several customers of said company under the express obligation to account
for the proceeds of the sales and deliver the collection to the said company, but far from complying with her
obligation and after a reasonable period of time despite repeated demands therefore, and she failed to deliver
the said collection to the said company but instead, misappropriated the proceeds of the sale to her own use and
benefit.
Go had requested the store auditor to audit petitioner after some customers had told him that they had already
paid their accounts but the office ledger had still reflected outstanding balances for them. She discovered in the
course of her audit that the amounts appearing on the original copies of receipts in the possession of around 50
customers varied from the amounts written on the duplicate copies of the receipts petitioner submitted to the
office.

ISSUE: Whether or not the failure of the information for estafa to allege the falsification of the duplicate
receipts issued by petitioner to her customersviolated petitioners right to be informed of the nature and cause of
the accusation;

RULING:
Failure of information to allege falsification did not violate petitioners right to be informed of the nature
and cause of the accusation

The Bill of Rights guarantees some rights to every person accused of a crime, among them the right to
be informed of the nature and cause of the accusation. Rule 110 of the Revised Rules of Court, the rule then in
effect when the information was filed in the RTC, contained the following provisions on the proper manner of
alleging the nature and cause of the accusation in the information. An accused cannot be convicted of an
offense that is not clearly charged in the complaint or information. To convict him of an offense other than that
charged in the complaint or information would be violative of the Constitutional right to be informed of the
nature and cause of the accusation. Indeed, the accused cannot be convicted of a crime, even if duly proven,
unless the crime is alleged or necessarily included in the information filed against him.
The elements of the offense charged were as follows:

(a) That the offender received money, goods or other personal property in trust, or on commission, or
for administration, or under any other obligation involving the duty to make delivery of, or to
return, the same;

(b) That the offender misappropriated or converted such money, goods or other personal property, or
denied his part in its receipt;

(c) That the misappropriation or conversion or denial was to the prejudice of another; and

(d) That the offended party made a demand on the offender for the delivery or return of such money,
goods or other personal property

We consider it inevitable to conclude that the information herein completely pleaded the estafa defined
and penalized under Article 315, paragraph 1 (b), Revised Penal Code within the context of the substantive law
and the rules. Verily, there was no necessity for the information to allege the acts of falsification by petitioner
because falsification was not an element of the estafa charged. Distinction should be made as to when the
crimes of Estafa and Falsification will constitute as one complex crime and when they are considered as
two separate offenses. The complex crime of Estafa Through Falsification of Documents is committed
when one has to falsify certain documents to be able to obtain money or goods from another person. In
other words, the falsification is a necessary means of committing estafa. However, if the falsification is
committed to conceal the misappropriation, two separate offenses of estafa and falsification are
committed.

Testimonial and documentary evidence, being hearsay, did not prove petitioners guilt beyond reasonable
doubt
Go essentially described for the trial court the various duties of petitioner as Footluckers sales
representative. On her part, Guivencan conceded having no personal knowledge of the amounts actually
received by petitioner from the customers or remitted by petitioner to Footluckers. This means that persons
other than Guivencan prepared Exhibits B to YY and their derivatives, inclusive, and that Guivencan based her
testimony on the entries found in the receipts supposedly issued by petitioner and in the ledgers held by
Footluckers corresponding to each customer, as well as on the unsworn statements of some of the customers.
Accordingly, her being the only witness who testified on the entries effectively deprived the RTC of the
reasonable opportunity to validate and test the veracity and reliability of the entries as evidence of petitioners
misappropriation or conversion through cross-examination by petitioner. The denial of that
opportunity rendered the entire proof of misappropriation or conversion hearsay, and thus unreliable and
untrustworthy for purposes of determining the guilt or innocence of the accused.

Section 36 of Rule 130, Rules of Court states that a witness can testify only to those facts that she
knows of her personal knowledge; that is, which are derived from her own perception, except as otherwise
provided in the Rules of Court. In case a witness is permitted to testify based on what she has heard another
person say about the facts in dispute, the person from whom the witness derived the information on the facts in
dispute is not in court and under oath to be examined and cross-examined. The weight of such testimony then
depends not upon the veracity of the witness but upon the veracity of the other person giving the information to
the witness without oath. The information cannot be tested because the declarant is not standing in court as a
witness and cannot, therefore, be cross-examined. Thus, the rule against hearsay testimony rests mainly on the
ground that there was no opportunity to cross-examine the declarant.
The rule excluding hearsay as evidence is based upon serious concerns about the trustworthiness
and reliability of hearsay evidence due to its not being given under oath or solemn affirmation and due to its not
being subjected to cross-examination by the opposing counsel to test the perception, memory, veracity and
articulateness of the out-of-court declarant or actor upon whose reliability the worth of the out-of-court
statement depends. Based on the foregoing considerations, Guivencans testimony as well as Exhibits B to YY,
and their derivatives, inclusive, must be entirely rejected as proof of petitioners misappropriation or conversion.

Ray Vivo vs. PAGCOR

G.R. No. 187854, November 12, 2013
BERSAMIN, J.:
The essence of due process is to be heard, and, as applied to administrative proceedings, this means a fair and
reasonable opportunity to explain ones side, or an opportunity to seek a reconsideration of the action or
ruling complained of. Administrative due process cannot be fully equated with due process in its strict judicial
sense, for in the former a formal or trial-type hearing is not always necessary, and technical rules of procedure
are not strictly applied.
FACTS:
The petitioner was employed by respondent Philippine Amusement and Gaming Corporation (PAGCOR) on
September 9, 1986, and was PAGCORs Managing Head of its Gaming Department at the time of his dismissal
from office. On February 21, 2002, he received a letter from Teresita S. Ela, the Senior Managing Head of
PAGCORs Human Resources Department, advising that he was being administratively charged with gross
misconduct, rumor-mongering, conduct prejudicial to the interest of the company, and loss of trust and
confidence; that he should submit a written explanation of the charges; and that he was at the same time being
placed under preventive suspension. On February 26, 2002, the petitioners counsel, replying to Elas letter,
assailed the propriety of the show-cause memorandum as well as the basis for placing the petitioner under
preventive suspension. On March 14, 2002, the petitioner received the summons for him to attend an
administrative inquiry, instructing him to appear before PAGCORs Corporate Investigation Unit (CIU) on
March 15, 2002.8 At the petitioners request, however, the inquiry was conducted at his residence on said date.
His statement was taken in a question-and-answer format. He was also furnished the memorandum of charges
that recited the accusations against him and indicated the acts and omissions constituting his alleged offenses.
The memorandum of charges was based on the statements of PAGCOR personnel who had personal knowledge
of the accusations against him. However, when his counsel requested to be furnished copies of the statements,
PAGCOR rejected the request on the ground that he had already been afforded the sufficient opportunity to
confront, hear, and answer the charges against him during the administrative inquiry. The petitioner was then
allowed to submit his answer on March 26, 2002. The petitioner received the letter dated May 15, 2002 from
Ela informing him of the resolution of the PAGCOR Board of Directors in its May 14, 2002 meeting to the
effect that he was being dismissed from the service. After the petitioners motion for reconsideration vis--vis
the resolution of the PAGCOR Board of Directors dismissing him from the service was denied, he appealed his
dismissal to the CSC. CSC ruled that PAGCOR violated his right to due process.

ISSUE: Whether or not petitioner was deprived of due process

RULING: No
The observance of fairness in the conduct of any investigation is at the very heart of procedural due process.
The essence of due process is to be heard, and, as applied to administrative proceedings, this means a fair and
reasonable opportunity to explain ones side, or an opportunity to seek a reconsideration of the action or ruling
complained of. Administrative due process cannot be fully equated with due process in its strict judicial sense,
for in the former a formal or trial-type hearing is not always necessary, and technical rules of procedure are not
strictly applied. The petitioner actively participated in the entire course of the investigation and hearings
conducted by PAGCOR. He received the letter from Ela apprising him of his being administratively charged
for several offenses, and directing him to submit an explanation in writing. He was later on properly
summoned to appear before the CIU, which conducted its proceedings in his own residence upon his request.
During the administrative inquiry, the CIU served him a copy of the memorandum of charges, which detailed
the accusations against him and specified the acts and omissions constituting his alleged offenses. He was also
given the opportunity to appear before the Adjudication Committee to answer clarificatory questions. Lastly,
he was informed through a memorandum of the decision of the Board of Directors dismissing him from the
service.
Petitioners pleadings explicitly admitted that his dismissal had been effected through board resolutions. That
he was not furnished copies of the board resolutions did not negate the existence of the resolutions, and did not
invalidate the contents of the board resolutions. It is beyond question that he was duly informed of the subject-
matter of the board resolutions. Consequently, the CSCs conclusion that his dismissal had been unauthorized
was unfounded. In any case, even assuming for the sake of argument that there was no board resolution
approving his dismissal, the lapse did not render his dismissal illegal but unauthorized. However, as the CA
succinctly put it, an unauthorized act could be the subject of ratification. In any event, any procedural defect in
the proceedings taken against the petitioner was cured by his filing of the motion for reconsideration and by his
appealing the adverse result to the CSC. The petitioner was not denied due process of law, for he was afforded
the fair and reasonable opportunity to explain his side.

Marie Callo-Claridad vs. Philip Esteban and Teodora Esteban

G.R. No. 191567, March 20, 2013
BERSAMIN, J.:
The determination of probable cause to file a criminal complaint or information in court is exclusively within
the competence of the Executive Department, through the Secretary of Justice. The courts cannot interfere in
such determination, except upon a clear showing that the Secretary of Justice committed grave abuse of
discretion amounting to lack or excess of jurisdiction.
FACTS:
The petitioner is the mother of the late Cheasare Armani Chase Callo Claridad, whose lifeless but bloodied
body was discovered in the evening of February 27, 2007 between vehicles parked at the carport of a residential
house located at No.10 Cedar Place, Ferndale Homes, Quezon City. Allegedly, Chase had been last seen alive
with respondent Philip Ronald P. Esteban (Philip) less than an hour before the discovery of his lifeless body.
The Office of the City Prosecutor (OCP) of Quezon City dismissed the complaint. The OCP observed that there
was lack of evidence, motive, and circumstantial evidence sufficient to charge Philip with homicide, much less
murder; that the circumstantial evidence could not link Philip to the crime; that several possibilities would
discount Philips presence at the time of the crime, including the possibility that there were more than one
suspect in the fatal stabbing of Chase; that Philip was not shown to have any motive to kill Chase; that their
common friends attested that the two had no ill-feelings towards each other; that no sufficient evidence existed
to charge Teodora with the crime, whether as principal, accomplice, or accessory; and that the allegation that
Teodora could have been the female person engaged in a discussion with a male person inside the car with plate
JTG 333 was unreliable being mere hearsay. Secretary of Justice affirmed the dismissal of the complaint.

ISSUE: Whether the CA committed a reversible error in upholding the decision of the Secretary of Justice
finding that there was no probable cause to charge Philip and Teodora with murder for the killing of Chase.

RULING: No
The filing of a petition for review under Rule 43 to review the Secretary of Justices resolution on the
determination of probable cause was an improper remedy.11 Indeed, the CA had no appellate jurisdiction vis--
vis the Secretary of Justice. A petition for review under Rule 43 is a mode of appeal to be taken only to review
the decisions, resolutions or awards by the quasi-judicial officers, agencies or bodies, particularly those
specified in Section 1 of Rule 43. In the matter before us, however, the Secretary of Justice was not an officer
performing a quasi-judicial function. In reviewing the findings of the OCP of Quezon City on the matter of
probable cause, the Secretary of Justice performed an essentially executive function to determine whether the
crime alleged against the respondents was committed, and whether there was probable cause to believe that the
respondents were guilty thereof.
On the other hand, the courts could intervene in the Secretary of Justices determination of probable cause only
through a special civil action for certiorari. That happens when the Secretary of Justice acts in a limited sense
like a quasi-judicial officer of the executive department exercising powers akin to those of a court of law. But
the requirement for such intervention was still for the petitioner to demonstrate clearly that the Secretary of
Justice committed grave abuse of discretion amounting to lack or excess of jurisdiction. Unless such a clear
demonstration is made, the intervention is disallowed in deference to the doctrine of separation of powers.
A preliminary investigation, according to Section 1, Rule 112 of the Rules of Court, is an inquiry or
proceeding to determine whether there is sufficient ground to engender a well-founded belief that a crime has
been committed and the respondent is probably guilty thereof, and should be held for trial. The investigation
is advisedly called preliminary, because it is yet to be followed by the trial proper in a court of law. The
occasion is not for the full and exhaustive display of the parties evidence but for the presentation only of such
evidence as may engender a well-founded belief that an offense has been committed and that the accused is
probably guilty of the offense. The role and object of preliminary investigation were to secure the innocent
against hasty, malicious, and oppressive prosecutions, and to protect him from open and public accusation of
crime, from the trouble, expenses and anxiety of a public trial, and also to protect the State from useless and
expensive prosecutions.
The determination of the existence of probable cause lies within the discretion of the public prosecutor after
conducting a preliminary investigation upon the complaint of an offended party. A public prosecutor alone
determines the sufficiency of evidence that establishes the probable cause justifying the filing of a criminal
information against the respondent because the determination of existence of a probable cause is the function of
the public prosecutor. Under the circumstances presented, we conclude to be correct the CAs determination
that no prima facie evidence existed that sufficiently indicated the respondents involvement in the commission
of the crime. It is clear that there was no eyewitness of the actual killing of Chase; or that there was no evidence
showing how Chase had been killed, how many persons had killed him, and who had been the perpetrator or
perpetrators of his killing. There was also nothing that directly incriminated the respondents in the commission
of either homicide or murder.

San Miguel Properties, Inc. vs. Sec. Hernando Perez

G.R. No. 166836, September 4, 2013
BERSAMIN, J:
The pendency of an administrative ease for specific performance brought by the buyer of residential
subdivision lots in the Housing and Land Use Regulatory .Board (IILURH) to compel the seller to deliver the
transfer certificate of title (TCTs) of the fully paid Jots is properly considered a ground to suspend a criminal
prosecution for violation of Sectio11 25 of Presidential Decree NL). 9571 on tile ground of a prejudicial
question. The administrative determination is a logical antecedent of the resolution of the criminal charges
based on non-delivery of the TCTs.
FACTS:
Petitioner San Miguel Properties Inc. (San Miguel Properties), a domestic corporation engaged in the real estate
business, purchased in 1992, 1993 and April 1993 from B.F. Homes, Inc. (BF Homes), then represented by
Atty. Florencio B. Orendain as its duly authorized rehabilitation receiver appointed by the Securities and
Exchange Commission (SEC), 130 residential lots situated in its subdivision BF Homes Paraaque, containing
a total area of 44,345 square meters for the aggregate price of P106,248,000.00. The transactions were
embodied in three separate deeds of sale. The TCTs covering the lots bought under the first and second deeds
were fully delivered to San Miguel Properties, but 20 TCTs covering 20 of the 41 parcels of land with a total
area of 15,565 square meters purchased under the third deed of sale, executed in April 1993 and for which San
Miguel Properties paid the full price of P39,122,627.00, were not delivered to San Miguel Properties. On its
part, BF Homes claimed that it withheld the delivery of the 20 TCTs for parcels of land purchased under the
third deed of sale because Atty. Orendain had ceased to be its rehabilitation receiver at the time of the
transactions after being meanwhile replaced as receiver by FBO Network Management, Inc. on May 17, 1989
pursuant to an order from the SEC. BF Homes refused to deliver the 20 TCTs despite demands. Thus, San
Miguel Properties filed a complaint-affidavit in the Office of the City Prosecutor of Las Pias City charging
respondent directors and officers of BF Homes with non-delivery of titles in violation of Section 25, in relation
to Section 39, both of Presidential Decree No. 957. At the same time, San Miguel Properties sued BF Homes
for specific performance in the HLURB (HLURB Case No. REM-082400-11183), praying to compel BF
Homes to release the 20 TCTs in its favor.

ISSUE: Whether the HLURB administrative case brought to compel the delivery of the TCTs could be a
reason to suspend the proceedings on the criminal complaint for the violation of Section 25 of Presidential
Decree No. 957 on the ground of a prejudicial question.

RULING:
Action for specific performance, even if pending in the HLURB, an administrative agency, raises a
prejudicial question
The determination of whether the proceedings ought to be suspended because of a prejudicial question rested
on whether the facts and issues raised in the pleadings in the specific performance case were so related with the
issues raised in the criminal complaint for the violation of Presidential Decree No. 957, such that the resolution
of the issues in the former would be determinative of the question of guilt in the criminal case. An examination
of the nature of the two cases involved is thus necessary. An action for specific performance is the remedy to
demand the exact performance of a contract in the specific form in which it was made, or according to the
precise terms agreed upon by a party bound to fulfill it. Evidently, before the remedy of specific performance is
availed of, there must first be a breach of the contract. Accordingly, the injured party may choose between
specific performance or rescission with damages. On the other hand, Presidential Decree No. 957 is a law that
regulates the sale of subdivision lots and condominiums in view of the increasing number of incidents wherein
real estate subdivision owners, developers, operators, and/or sellers have reneged on their representations and
obligations to provide and maintain properly the basic requirements and amenities, as well as of reports of
alarming magnitude of swindling and fraudulent manipulations perpetrated by unscrupulous subdivision and
condominium sellers and operators, such as failure to deliver titles to the buyers or titles free from liens and
encumbrances. Presidential Decree No. 957 authorizes the suspension and revocation of the registration and
license of the real estate subdivision owners, developers, operators, and/or sellers in certain instances, as well
as provides the procedure to be observed in such instances; it prescribes administrative fines and other penalties
in case of violation of, or non-compliance with its provisions.
Conformably with the foregoing, the action for specific performance in the HLURB would determine whether
or not San Miguel Properties was legally entitled to demand the delivery of the remaining 20 TCTs, while the
criminal action would decide whether or not BF Homes directors and officers were criminally liable for
withholding the 20 TCTs. The resolution of the former must obviously precede that of the latter, for should the
HLURB hold San Miguel Properties to be not entitled to the delivery of the 20 TCTs because Atty. Orendain
did not have the authority to represent BF Homes in the sale due to his receivership having been terminated by
the SEC, the basis for the criminal liability for the violation of Section 25 of Presidential Decree No. 957 would
evaporate, thereby negating the need to proceed with the criminal case.

People of the Philippines vs. Alberto Gonzales

G.R. No. 182417, April 3, 2013
BERSAMIN, J.:
The State, and no other party, has the responsibility to explain the lapses in the procedures taken to preserve
the chain of custody of the dangerous drugs. Without the explanation by the State, the evidence of the corpus
delicti is unreliable, and the acquittal of the accused should follow on the ground that his guilt has not been
shown beyond reasonable doubt.
FACTS:
An informant reported to the Provincial Drug Enforcement Group (PDEG) based in Camp General Alejo
Santos, Malolos, Bulacan, that Gonzales was engaging in illegal drug pushing. On June 13, 2003, Police Chief
Inspector Celedonio I. Morales planned to mount a buybust operation against Gonzales, and designated PO1
Eduardo B. Dimla, Jr. to act as the poseur buyer and PO2 Roel S. Chan to serve as the backup/arresting officer.
PO1 Dimla marked with his own initials ED each of the two P100.00 bills to be used as the buy-bust money,
and then recorded the marked bills in the police blotter. At noontime of that same day, PO1 Dimla and PO2
Chan met with the informant at Krus na Daan, San Rafael, Bulacan, and the three of them proceeded to Banca-
Banca, San Rafael, Bulacan, where the house of Gonzales was located. After PO2 Chan posted himself beyond
possible view of the suspect, PO1 Dimla and the informant approached Gonzales, with the informant
introducing PO1 Dimla to Gonzales as a buyer of shabu worth P200.00. Gonzales handed to PO1 Dimla a
plastic sachet containing white substances, and in turn PO1 Dimla handed the two marked P100.00 bills to
Gonzales. At that point, PO1 Dimla removed his cap, the pre-arranged signal, in reaction to which PO2 Chan
then rushed forward and arrested Gonzales. PO1 Dimla then immediately marked the plastic sachet with his
initials ED. The Bulacan Provincial Crime Laboratory Office certified that the contents the plastic sachet
were 0.194 gram of shabu. RTC convicted Gonzales of the crime charged.

ISSUE: Whether or not the Prosecution was able to prove his guilt for violation of Section 5, Article II of
Republic Act No. 9165 beyond reasonable doubt.

RULING:
To secure a conviction of the accused charged with the illegal sale of dangerous drugs as defined and punished
by Section 5, Article II of Republic Act No. 9165, the State must establish the concurrence of the following
elements, namely: (a) that the transaction or sale took place between the accused and the poseur buyer; and (b)
that the dangerous drugs subject of the transaction or sale is presented in court as evidence of the corpus delicti.
Anent the second element, it is indispensable for the State to establish that the dangerous drugs subject of the
transaction or sale and subsequently examined in the laboratory are the same dangerous drugs presented in
court as evidence. The identity of the dangerous drugs is essential to proving the corpus delicti. To achieve that
end, Section 21 of Republic Act No. 9165 and Section 21(a) of the Implementing Rules and Regulations of
Republic Act No. 9165 (IRR) define the procedures to be followed by the apprehending officers in the seizure
and custody of the dangerous drugs.
These provisions obviously demand strict compliance, for only by such strict compliance may be eliminated the
grave mischiefs of planting or substitution of evidence and the unlawful and malicious prosecution of the weak
and unwary that they are intended to prevent. Such strict compliance is also consistent with the doctrine that
penal laws shall be construed strictly against the Government and liberally in favor of the accused.
The first stage in the chain of custody is the marking of the dangerous drugs or related items. Marking, which is
the affixing on the dangerous drugs or related items by the apprehending officer or the poseur-buyer of his
initials or signature or other identifying signs, should be made in the presence of the apprehended violator
immediately upon arrest. The importance of the prompt marking cannot be denied, because succeeding handlers
of the dangerous drugs or related items will use the marking as reference. Also, the marking operates to set
apart as evidence the dangerous drugs or related items from other material from the moment they are
confiscated until they are disposed of at the close of the criminal proceedings, thereby forestalling switching,
planting, or contamination of evidence. Although PO1 Dimla, the States lone witness, testified that he had
marked the sachet of shabu with his own initials of ED following Gonzales arrest, he did not explain, either
in his court testimony or in the joint affidavit of arrest, whether his marking had been done in the presence of
Gonzales, or done immediately upon the arrest of Gonzales. Nor did he show by testimony or otherwise who
had taken custody of the sachet of shabu after he had done his marking, and who had subsequently brought the
sachet of shabu to the police station, and, still later on, to the laboratory. Given the possibility of just anyone
bringing any quantity of shabu to the laboratory for examination, there is now no assurance that the quantity
presented here as evidence was the same article that had been the subject of the sale by Gonzales. The
indeterminateness of the identities of the individuals who could have handled the sachet of shabu after PO1
Dimlas marking broke the chain of custody, and tainted the integrity of the shabu ultimately presented as
evidence to the trial court. We hardly need to reiterate that the chain of custody demands such record of
movements and custody of seized items to include the identities and signatures of the persons who held
temporary custody of the seized item, the dates and times when such transfers of custody were made in the
course of safekeeping and use in court as evidence, and the final disposition. PO1 Dimla and PO2 Chua did not
mention any inventory and photographing. The omission can only mean that no such inventory and
photographing were done by them. The omission of the inventory and photographing exposed another
weakness of the evidence of guilt, considering that the inventory and photographing to be made in the presence
of the accused or his representative, or within the presence of any representative from the media, Department of
Justice or any elected official, who must sign the inventory, or be given a copy of the inventory, were really
significant stages of the procedures outlined by the law and its IRR.
People of the Philippines vs. Arnold Tapere
G.R No. 178065, February 20, 2013
BERSAMIN, J.:
An accused arrested during a valid entrapment operation is not entitled to an acquittal on the ground that his
arrest resulted from instigation.
FACTS:
Arnold P. Tapere was charged with, tried for and found guilty of illegally selling shabu in violation of Section
5, Article II of Republic Act No. 9165 (Comprehensive Dangerous Drugs Act of 2002) by the RTC which
sentenced him to suffer life imprisonment and to pay a fine of P500,000.00. At around 7:30 p.m. on September
2, 2002, elements of the Philippine Drug Enforcement Agency (PDEA) arrested Tapere for selling shabu to a
poseur buyer during a buy-bust operation conducted against him in Purok San Antonio, Iligan City. Prior to the
buy-bust operation, Tapere was already included in the PDEAs drug watch list as a drug pusher based on the
frequent complaints made against him by residents of Purok San Antonio, Iligan City. In order to determine the
veracity of the report of Salgado, PDEA agents conducted an investigation and surveillance of the activities of
Tapere on August 30, August 31, and September 1, 2002, during which a test buy confirmed the veracity of the
report. With the positive result of the test buy, the agents decided to conduct a buy-bust operation against
Tapere on September 2, 2002. Consonant with their standard procedure, the agents first secured a certification
from the Office of the City Prosecutor regarding the buy-bust money to be used during the buy-bust operation.
The team posted themselves within view of the target place. With each agent being strategically posted,
Salgado was signalled to approach Tapere according to the plan. Salgado went towards Tapere. The agents saw
the two conversing for a brief while before Salgado handed money to Tapere. In turn, Tapere took a small heat-
sealed plastic sachet from his pocket and gave it to Salgado. After accepting the sachet, Salgado made the pre-
arranged signal of scratching his head to signify the consummation of the transaction. The agents rushed
towards Tapere, introduced themselves as PDEA agents, and placed him in custody. They searched him and
recovered the P100.00 bill from his right pocket. At that point, he voluntarily produced three more sachets of
shabu from his pocket and handed them to SPO2 Bastatas. RTC rendered judgment convicting Tapere as
charged.

ISSUE: Whether or not his apprehension was the product of an instigation, not entrapment; and that he should
consequently be acquitted because instigation was an absolutory cause.

RULING: No
The State conclusively established the concurrence of the foregoing elements of illegal sale of dangerous drugs.
Firstly, the members of the buybust team identified Tapere as the person with whom Salgado had contracted on
the purchase of the shabu. Secondly, the subject of the sale was one plastic sachet of shabu that the PNP Crime
Laboratory later on confirmed in due course to contain methamphetamine hydrochloride, a dangerous drug. It
is of no consequence that three other sachets of shabu recovered from Taperes possession at the time of his
arrest were also presented as evidence during the trial, or that the Prosecution failed to specify which of the
four sachets was the sachet involved in the transaction between him and Salgado, because what is decisive is
that one of the four sachets was definitely the subject of the transaction between Tapere and the poseur buyer.
Thirdly, the consideration of the sale was P100.00, and the actual payment of that amount through the P100.00
bill covered by the public prosecutors certification ensured the identification of it as the consideration. And,
fourthly, the Prosecutions witnesses fully described the details of the consummated sale of shabu between
Tapere as seller and Salgado as buyer.
Instigation takes place when a peace officer induces a person to commit a crime. Without the inducement, the
crime would not be committed. Hence, it is exempting by reason of public policy; otherwise, the peace officer
would be a co-principal. It follows that the person instigating must not be a private person, because he will be
liable as a principal by inducement. On the other hand, entrapment signifies the ways and means devised by a
peace officer to entrap or apprehend a person who has committed a crime. With or without the entrapment, the
crime has been committed already. Hence, entrapment is not mitigating. Although entrapment is sanctioned by
law, instigation is not. The difference between the two lies in the origin of the criminal intent in entrapment,
the mens rea originates from the mind of the criminal, but in instigation, the law officer conceives the
commission of the crime and suggests it to the accused, who adopts the idea and carries it into execution. In
light of the foregoing differentiation between instigation and entrapment, the Court rejects the contention of
Tapere for its being contrary to the established facts. Tapere was caught in flagrante delicto committing the
illegal sale of shabu during the buy-bust operation.
People of the Philippines vs. Noel Bartolome
G.R. No. 191726, February 6, 2013
BERSAMIN, J.:
A buy-bust operation has been recognized in this jurisdiction as a legitimate form of entrapment of the culprit.
It is distinct from instigation, in that the accused who is otherwise not predisposed to commit the crime is
enticed or lured or talked into committing the crime. While entrapment is legal, instigation is not.
FACTS:
On August 10, 2003, at around 1:00 a.m., an informant went to the Anti-Illegal Drugs Special Operations Unit
(ADSOU) in Caloocan City to report the illicit drug dealings of the accused on Reparo Street, Bagong Barrio,
Caloocan City. During the pre-operation briefing, the buybust team designated PO1 Borban Paras as the
poseur-buyer. Paras was given a P100.00 bill that he marked with his initials BP. It was agreed that the
informant would drop a cigarette butt in front of the suspect to identify him to Paras; and that Paras would
scratch his head to signal to the buy-bust team that the transaction with the suspect had been consummated.
Paras went towards the suspect and said to him: Pre pa-iskor nga. The suspect responded: Pre, piso na lang tong
hawak magkano ba kukunin mo? Paras replied: Ayos na yan, piso lang naman talaga ang kukunin ko, after
which he handed the marked 100.00 bill to the suspect, who in turn drew out a plastic sachet containing white
substances from his pocket and gave the sachet to Paras. With that, Paras scratched his head to signal the
consummation of the sale. As the other members of the team were approaching, Paras grabbed the suspect.
RTC convicted Bartolome of the crime of illegal sale of methampethamine hydrochloride or shabu in violation
of Section 5, Article II of Republic Act No. 9165 (Comprehensive Dangerous Drugs Act of 2002).

ISSUE: Whether or not the accused must be acquitted

RULING: No
The accused was not arrested following an instigation for him to commit the crime. Instead, he was caught in
flagrante delicto during an entrapment through buy-bust. In a buy-bust operation, the pusher sells the
contraband to another posing as a buyer; once the transaction is consummated, the pusher is validly arrested
because he is committing or has just committed a crime in the presence of the buyer. Here, Paras asked the
accused if he could buy shabu, and the latter, in turn, quickly transacted with the former, receiving the marked
bill from Paras and turning over the sachet of shabu he took from his pocket. The accused was shown to have
been ready to sell the shabu without much prodding from Paras. There is no question that the idea to commit
the crime originated from the mind of the accused.
We have held that prior surveillance is not necessary to render a buy-bust operation legitimate, especially when
the buy-bust team is accompanied to the target area by the informant. That was what precisely happened here.
Similarly, the presentation of an informant as a witness is not regarded as indispensable to the success of a
prosecution of a drug-dealing accused. As a rule, the informant is not presented in court for security reasons, in
view of the need to protect the informant from the retaliation of the culprit arrested through his efforts.
Thereby, the confidentiality of the informants identity is protected in deference to his invaluable services to
law enforcement. Only when the testimony of the informant is considered absolutely essential in obtaining the
conviction of the culprit should the need to protect his security be disregarded. Here, however, the informants
testimony as a witness against the accused would only be corroborative of the sufficient testimony of Paras as
the poseur-buyer; hence, such testimony was unnecessary.
Although it appears that the buy-bust team did not literally observe all the requirements, like photographing the
confiscated drugs in the presence of the accused, of a representative from the media and from the Department
of Justice, and of any elected public official who should be required to sign the copies of the inventory and be
given a copy of it, whatever justification the members of the buy-bust team had to render in order to explain
their non-observance of all the requirements would remain unrevealed because the accused did not assail such
non-compliance during the trial. He raised the matter for the first time only in the CA. As such, the Court
cannot now dwell on the matter because to do so would be against the tenets of fair play and equity. We point
out that the non-adherence to Section 21, Article II of Republic Act No. 9165 was not a serious flaw that would
make the arrest of the accused illegal or that would render the shabu subject of the sale by him inadmissible as
evidence against him. What was crucial was the proper preservation of the integrity and the evidentiary value of
the seized shabu, inasmuch as that would be significant in the determination of the guilt or innocence of the
accused. The State showed here that the chain of custody of the shabu was firm and unbroken.
People of the Philippines vs. PO2 Eduardo Valdez and Edwin Valdez
G.R. No. 175602, February 13, 2013
BERSAMIN, J.:
Edwin cannot be barred from seeking the application to him of the downgrading of the crimes committed (and
the resultant lighter penalties) despite the finality of his convictions for three counts of murder due to his
withdrawal of his appeal. The downgrading of the crimes committed would definitely be favorable to him.
Worth pointing out is that to deny to him the benefit of the lessened criminal responsibilities would be highly
unfair, considering that this Court had found the two accused to have acted in concert in their deadly assault
against the victims, warranting their equal liability under the principle of conspiracy.
FACTS:
The two accused were tried for three counts of murder by the Regional Trial Court (RTC), Branch 86, in
Quezon City. On January 20, 2005, after trial, the RTC convicted them as charged, prescribed on each of them
the penalty of reclusion perpetua for each count, and ordered them to pay to the heirs of each victim P93,000.00
as actual damages, P50,000.00 as civil indemnity, and P50,000.00 as moral damages. The CA upheld the RTC,
subject to the modification that each of the accused pay to the heirs of each victim P50,000.00 as civil
indemnity, P50,000.00 as moral damages, P25,000.00 as temperate damages, and P25,000.00 as exemplary
damages, plus costs of suit. The two accused then came to the Court on final appeal, but on May 9, 2007,
Edwin Valdez filed a motion to withdraw appeal, which the Court granted, thereby deeming Edwins appeal
closed and terminated. Court promulgated its judgment on the appeal of PO2 Eduardo Valdez, finding him
guilty of three counts of homicide, instead of three counts of murder, and meting on him for each count of
homicide the indeterminate sentence of 10 years of prision mayor as minimum to 17 years of reclusion
temporal as maximum. Edwin sent to the Court Administrator a letter, where he pleaded for the application to
him of the judgment promulgated on the ground that the judgment would be beneficial to him as an accused.

ISSUE: Whether or not the judgment promulgated may be granted to Edwin

RULING: Yes
The final judgment downgraded the crimes committed by Eduardo from three counts of murder to three counts
of homicide, and consequently prescribed lighter penalties in the form of indeterminate sentences. As a result,
Eduardo would serve only an indeterminate sentence of 10 years of prision mayor as minimum to 17 years of
reclusion temporal as maximum, under which he can qualify for parole in due course by virtue of the
Indeterminate Sentence Law, instead of suffering the indivisible penalty of reclusion perpetua for each count.
On his part, Edwin cannot be barred from seeking the application to him of the downgrading of the crimes
committed (and the resultant lighter penalties) despite the finality of his convictions for three counts of murder
due to his withdrawal of his appeal. The downgrading of the crimes committed would definitely be favorable to
him. Worth pointing out is that to deny to him the benefit of the lessened criminal responsibilities would be
highly unfair, considering that this Court had found the two accused to have acted in concert in their deadly
assault against the victims, warranting their equal liability under the principle of conspiracy. We grant Edwins
plea based on Section 11(a), Rule 122 of the Rules of Court , which relevantly provides:
Section 11. Effect of appeal by any of several accused. (a) An appeal taken by one or more of several accused
shall not affect those who did not appeal, except insofar as the judgment of the appellate court is favorable and
applicable to the latter.

Herminio Disini vs. Sandiganbayan

G.R. Nos. 169823-24, September 11, 2013
BERSAMIN, J.:
The Sandiganbayan has exclusive original jurisdiction over the criminal action involving petitioner
notwithstanding that he is a private individual considering that his criminal prosecution is intimately related to
the recovery of ill-gotten wealth of the Marcoses, their immediate family, subordinates and close associates.
FACTS:
The Office of the Ombudsman filed two informations dated June 30, 2004 charging Disini in the
Sandiganbayan with corruption of public officials, penalized under Article 212 in relation to Article 210 of the
Revised Penal Code (Criminal Case No. 28001), and with a violation of Section 4(a) of Republic Act 3019
(R.A. No. 3019), also known as the AntiGraft and Corrupt Practices Act (Criminal Case No. 28002). Disini
filed a motion to quash, alleging that the criminal actions had been extinguished by prescription, and that the
informations did not conform to the prescribed form. The Prosecution opposed the motion to quash. Disini
voluntarily submitted himself for arraignment to obtain the Sandiganbayans favorable action on his motion for
permission to travel abroad. He then entered a plea of not guilty to both informations. Sandiganbayan (First
Division) promulgated its assailed resolution denying the motion to quash.

ISSUE: Whether or not Sandiganbayan has jurisdiction over the case

RULING:
Sandiganbayan has exclusive and original jurisdiction over the offenses charged
Presidential Decree (P.D.) No. 1606 was the law that established the Sandiganbayan and defined its
jurisdiction. The law was amended by R.A. No. 7975 and R.A. No. 8249. Under Section 4 of R.A. No. 8249,
the Sandiganbayan was vested with original and exclusive jurisdiction over all cases involving Civil and
criminal cases filed pursuant to and in connection with Executive Order Nos. 1, 2, 14 and 14-A, issued in
1986.
That Disini was a private individual did not remove the offenses charged from the jurisdiction of the
Sandiganbayan. Section 2 of E.O. No. 1, which tasked the PCGG with assisting the President in [t]he
recovery of all ill-gotten wealth accumulated by former President Ferdinand E. Marcos, his immediate family,
relatives, subordinates and close associates, whether located in the Philippines or abroad, including the takeover
or sequestration of all business enterprises and entities owned or controlled by them, during his administration,
directly or through nominees, by taking undue advantage of their public office and/or using their powers,
authority, influence, connections or relationship, expressly granted the authority of the PCGG to recover ill-
gotten wealth covered President Marcos immediate family, relatives, subordinates and close associates,
without distinction as to their private or public status.
Contrary to Disinis argument, too, the qualifying clause found in Section 4 of R.A. No. 824922 applied only
to the cases listed in Subsection 4a and Subsection 4b of R.A. No. 8249. Unquestionably, public officials
occupying positions classified as Grade 27 or higher are mentioned only in Subsection 4a and Subsection 4b,
signifying the plain legislative intent of limiting the qualifying clause to such public officials. To include within
the ambit of the qualifying clause the persons covered by Subsection 4c would contravene the exclusive
mandate of the PCGG to bring the civil and criminal cases pursuant to and in connection with E.O. Nos. 1, 2,
14 and 14-A. In view of this, the Sandiganbayan properly took cognizance of Criminal Case No. 28001 and
Criminal Case No. 28002 despite Disinis being a private individual, and despite the lack of any allegation of
his being the co-principal, accomplice or accessory of a public official in the commission of the offenses
charged.

The offenses charged in the informations have not yet prescribed

The crime of corruption of public officials charged in Criminal Case No. 28001 is punished by Article 212 of
the Revised Penal Code with the same penalties imposed upon the officer corrupted.25 Under the second
paragraph of Article 210 of the Revised Penal Code (direct bribery),26 if the gift was accepted by the officer in
consideration of the execution of an act that does not constitute a crime, and the officer executes the act, he
shall suffer the penalty of prision mayor in its medium and minimum periods and a fine of not less than three
times the value of the gift. Conformably with Article 90 of the Revised Penal Code, the period of prescription
for this specie of corruption of public officials charged against Disini is 15 years. As for Criminal Case No.
28002, Disini was charged with a violation of Section 4(a) of R.A. No. 3019. By express provision of Section
11 of R.A. No. 3019, as amended by Batas Pambansa Blg. 195, the offenses committed under R.A. No. 3019
shall prescribe in 15 years.
The prevailing rule is, therefore, that irrespective of whether the offense charged is punishable by the Revised
Penal Code or by a special law, it is the filing of the complaint or information in the office of the public
prosecutor for purposes of the preliminary investigation that interrupts the period of prescription. Consequently,
prescription did not yet set in because only five years elapsed from 1986, the time of the discovery of the
offenses charged, up to April 1991, the time of the filing of the criminal complaints in the Office of the
Ombudsman.

The informations were sufficient in form and substance

It is axiomatic that a complaint or information must state every single fact necessary to constitute the offense
charged; otherwise, a motion to dismiss or to quash on the ground that the complaint or information charges no
offense may be properly sustained. The fundamental test in determining whether a motion to quash may be
sustained based on this ground is whether the facts alleged, if hypothetically admitted, will establish the
essential elements of the offense as defined in the law.37 Extrinsic matters or evidence aliunde are not
considered.38 The test does not require absolute certainty as to the presence of the elements of the offense;
otherwise, there would no longer be any need for the Prosecution to proceed to trial.
The informations in Criminal Case No. 28001 (corruption of public officials) and Criminal Case No. 28002
(violation of Section 4(a) of RA No. 3019) have sufficiently complied with the requirements of Section 6, Rule
110 of the Rules of Court. The allegations in the information for corruption of public officials, if hypothetically
admitted, would establish the essential elements of the crime. The information stated that: (1) Disini made an
offer and promise, and gave gifts to President Marcos, a public officer; and (2) in consideration of the offers,
promises and gifts, President Marcos, in causing the award of the contracts to Burns & Roe and Westinghouse
by taking advantage of his position and in committing said act in relation to his office, was placed under
circumstances that would make him liable for direct bribery.39 The second element of corruption of public
officers simply required the public officer to be placed under circumstances, not absolute certainty, that would
make him liable for direct or indirect bribery. Thus, even without alleging that President Marcos received or
accepted Disinis offers, promises and gifts an essential element in direct bribery the allegation that
President Marcos caused the award of the contracts to Burns & Roe and Westinghouse sufficed to place him
under circumstances of being liable for direct bribery.

People of the Philippines vs. Rudy Nuyok

G.R. No. 195424, June 15, 2015
BERSAMIN, J.:
Rape can be committed in a cramped dwelling despite the probable presence of other occupants because
seclusion is not an element of the crime. Its commission can be established by circumstantial evidence even if
the victim, being the sole witness, was rendered unconscious during its commission.
FACTS:
AAA, having been born on May 5, 1992 to the Spouses ABC and DEF as evidenced by her certificate of live
birth, was 13 years old when the accused committed the rapes in June, July, August and September of 2005. At
the time, she resided in the house of her grandmother, BBB, in Babac, Poblacion, Malalag, Davao del Sur. The
accused, her paternal uncle, also lived in the same house. At 9:00 oclock in the evening of June 25, 2005, as
AAA was about to sleep, the accused laid down beside her. Sensing fear, she tried to escape, but he pulled her
by the hair, slapped her, and punched her in the stomach, rendering her unconscious. Upon regaining
consciousness, she noticed that her sando was already raised up to her neck, and her panties had blood. She felt
pain in her vagina. She saw the accused putting on his pants. He warned her not to reveal the incident to
anyone, threatening to kill her and her family if she did so. Despite her fear she related the incident to BBB and
her elder sister CCC, but her report fell on deaf ears. He raped her again in July 2005. On that occasion, she
was sleeping in BBBs house when he crept up to her side, pulled her hair, took off her panties, laid on top of
her and inserted his penis into her. She resisted, and tried to kick him away but missed. He overpowered her
and succeeded in gratifying his lust. The accused committed the third rape in August 2005. On that occasion, he
punched AAA in the stomach and in the forehead, and then had carnal knowledge of her. AAA again told BBB
and CCC about the rape immediately afterwards, but BBB and CCC did not do anything except to promise to
AAA that they would be more wary of him from then on. On her part, AAA just waited for them to help her,
but that help never came. The fourth rape took place one evening in September 2005. The accused roused AAA
from sleep and threatened her with a scythe. He removed her shorts and panties, and had carnal knowledge of
her.

ISSUE: Whether or not the accused is guilty of the first rape.

RULING:
Despite the lack of testimony on how the accused had carnal knowledge of his victim on June 25, 2005, his
guilt was nonetheless shown beyond reasonable doubt. A conviction for rape may rest on direct as well as
circumstantial evidence. Thus, an accused like him can be declared guilty of rape even if the sole witness
against him was the victim who had been rendered unconscious at the time of the consummation of carnal
knowledge provided sufficient circumstantial evidence existed showing that the victim was violated, and that it
was the accused and no other who had committed the violation. To disallow such showing is to obstruct the
successful prosecution of a rapist who renders his victim unconscious before the consummation.
Circumstantial evidence, also known as indirect or presumptive evidence, onsists of proof of collateral facts
and circumstances from which the existence of the main fact may be inferred according to reason and common
experience. It is sufficient to sustain a conviction if: (a) there is more than one circumstance; ( b) the facts from
which the inferences were derived have been established; and ( c) the combination of all circumstances is such
as to warrant a finding of guilt beyond reasonable doubt. All the circumstances must be consistent with each
other, consistent with the hypothesis that the accused is guilty and at the same time inconsistent with the
hypothesis that he is innocent, and with every other rational hypothesis except that of guilt. In other words, a
judgment of conviction based on circumstantial evidence can be sustained when the circumstances proved form
an unbroken chain that results in a fair and reasonable conclusion pointing to the accused, to the exclusion of
all others, as the perpetrator.
The Prosecution successfully established the following facts and circumstances that, when taken together, very
well constituted evidence of the accused's guilt beyond reasonable doubt, to wit: (a) he and AAA lived in the
same house; (b) while AAA was sleeping at 9:00 o'clock in the evening of June 25, 2005 in the same house, he
crawled up and laid down beside her; (c) AAA tried to escape; (d) he then pulled AAA's hair, slapped her and
punched her in the stomach; (e) AAA was rendered unconscious; (j) when AAA regained consciousness, she
found blood in her panties, and her sando was already raised up to her neck; (g) AAA felt pain in her vagina;
(h) AAA saw him in the act of putting on his pants; (i) he threatened to kill AAA if she would reveal the
incident to anyone else; and (j) AAA sustained hymenal laceration. These circumstances, coupled with AAA' s
positive testimony that was corroborated by the examining physician's physical findings on her, lead to the
inescapable conclusion that he raped AAA against her will on that occasion.

Bernardo Mesina vs. People of the Philippines

G.R. No. 162489, June 17, 2015
BERSAMIN, J.:
Under the law, the civil liability of the petitioner may involve restitution, reparation of the damage caused, and
indemnification for consequential damages.
FACTS:
An information was filed in the RTC charging the petitioner with qualified theft. Upon his motion, he was
granted a reinvestigation. On September 17, 1998, after the reinvestigation, an amended information was filed
charging him instead with malversation of public funds. RTC found the petitioner guilty beyond reasonable
doubt of the crime of malversation. CA affirmed the RTCs decision, with modification as to the amount of fine
imposed.

ISSUE: Whether or not both RTC and CA is correct in not making the accused liable for the restitution of the
misappropriated amount.

RULING:
Both RTC and CA is incorrect. Although correct in finding the accused guilty of malversation the Court notes
that both lower courts did not require the petitioner to pay the amount of P37,876.98 subject of the
malversation. That omission was plain error that we should now likewise correct as a matter of course, for there
is no denying that pursuant to Article 100 of the Revised Penal Code, every person criminally liable for a
felony is also civilly liable. The omission, if unchecked and unrevised, would permanently deprive the City of
Caloocan of the misappropriated amount. Such prejudice to the public coffers should be avoided.
One more omission by the CA and the RTC concerned a matter of law. This refers to their failure to decree in
favor of the Government the return of the amounts criminally misappropriated by the accused. That he was
already sentenced to pay the fine in each count was an element of the penalties imposed under the Revised
Penal Code, and was not the same thing as finding him civilly liable for restitution, which the RTC and the CA
should have included in the judgment. Indeed, as the Court emphasized in Bacolod v. People, it was
"imperative that the courts prescribe the proper penalties when convicting the accused, and determine the civil
liability to be imposed on the accused, unless there has been a reservation of the action to recover civil liability
or a waiver of its recovery.
It is not amiss to stress that both the RTC and the CA disregarded their express mandate under Section 2, Rule
120 of the Rules of Court to have the judgment, if it was of conviction, state: "(1) the legal qualification of the
offense constituted by the acts committed by the accused and the aggravating or mitigating circumstances
which attended its commission; (2) the participation of the accused in the offense, whether as principal,
accomplice, or accessory after the fact; (3) the penalty imposed upon the accused; and (4) the civil liability or
damages caused by his wrongful act or omission to be recovered from the accused by the offended party, if
there is any, unless the enforcement of the civil liability by a separate civil action has been reserved or waived."
Their disregard compels us to act as we now do lest the Court be unreasonably seen as tolerant of their
omission.
We also pointedly remind all trial and appellate courts to avoid omitting reliefs that the parties are properly
entitled to by law or in equity under the established facts. Their judgments will not be worthy of the name
unless they thereby fully determine the rights and obligations of the litigants. It cannot be otherwise, for only
by a full determination of such rights and obligations would they be true to the judicial office of administering
justice and equity for all. Courts should then be alert and cautious in their rendition of judgments of conviction
in criminal cases. They should prescribe the legal penalties, which is what the Constitution and the law require
and expect them to do. Their prescription of the wrong penalties will be invalid and ineffectual for being done
without jurisdiction or in manifest grave abuse of discretion amounting to lack of jurisdiction. They should also
determine and set the civil liability ex delicto of the accused, in order to do justice to the complaining victims
who are always entitled to them. The Rules of Court mandates them to do so unless the enforcement of the civil
liability by separate actions has been reserved or waived.
Under the law, the civil liability of the petitioner may involve restitution, reparation of the damage caused, and
indemnification for consequential damages. Given that his obligation requires the payment of the amount
misappropriated to the City of Caloocan, the indemnification for damages is through legal interest of 6% per
annum on the amount malversed, reckoned from the finality of this decision until full payment.21
WHEREFORE, the Court AFFIRMS the decision promulgated on July 24, 2003 finding petitioner
BERNARDO U. MESINA guilty beyond reasonable doubt of malversation of public funds subject to the
MODIFICATIONS that: (a) he shall suffer the indeterminate penalty of 12 years and one day of reclusion
temporal, as minimum, to 18 years, eight months and one day of reclusion temporal, as maximum, and pay a
fine of P37,876.98; and (b) he shall further pay to the City of Caloocan the amount of P37,876.98, plus interest
thereon at the rate of 6% per annum, reckoned from the finality of this decision until the amount is fully paid.

People of the Philippines vs. Alvin Esugon

G.R. No. 195244, June 22, 2015
BERSAMIN, J.:
Every child is presumed qualified to be a witness. The party challenging the child's competency as a witness
has the burden of substantiating his challenge.
FACTS:
The information charged the appellant with robbery with homicide. Carl or Muymoy, 5-year old son of the
victim, testified that on the night of the incident, he, his younger sister Cheche, and his mother and father, were
sleeping on the ground floor of their house. He saw appellant, whom he calls Nonoy, enter their house and
stab her mother with a knife, while he (Carl) peeped through a chair. Although there was no light at the ground
floor, there was light upstairs. After his mother got stabbed, his father chased the appellant. Carl saw blood
come out of his mothers lower chest. His father then brought her to the hospital. Carl positively identified the
appellant, a neighbor who often goes to their house, as the one who stabbed his mother. On cross-examination,
he related that the assailant took money from his fathers pocket. He likewise admitted that he did not see very
well the perpetrator because there was no light. Upon being asked by the trial court, Carl stated that although
there was no light when his mother was stabbed, he was sure of what he saw since there was light at their
second floor, which illumined the ground floor through the stairway.

ISSUE: Whether or not the identification of the appellant as the perpetrator of the robbery with homicide was
credible and competent

RULING:
SC affirmed both lower courts. The qualification of a person to testify rests on the ability to relate to others the
acts and events witnessed. Towards that end, Section 20 and 21 Rule 130 of the Rules of Court makes clear
who may and may not be witnesses in judicial proceedings. Religious or political belief, interest in the outcome
of the case, or conviction of a crime unless otherwise provided by law, shall not be a ground for
disqualification. As the rules show, anyone who is sensible and aware of a relevant event or incident, and can
communicate such awareness, experience, or observation to others can be a witness. Age, religion, ethnicity,
gender, educational attainment, or social stat us are not necessary to qualify a person to be a witness, so long as
he does not possess any of the disqualifications as listed the rules. The generosity with which the Rules of
Court allows people to testify is apparent, for religious beliefs, interest in the outcome of a case, and conviction
of a crime unless otherwise provided by law are not grounds for disqualification.
The appellant points to inconsistencies supposedly incurred by Carl. That is apparently not disputed. However,
it seems clear that whatever inconsistencies the child incurred in his testimony did not concern the principal
occurrence or the elements of the composite crime charged but related only to minor and peripheral matters. As
such, their effect on his testimony was negligible, if not nil, because the inconsistencies did not negate the
positive identification of the appellant as the perpetrator. Also, that Carl did not shout to seek help upon
witnessing how the appellant had stabbed his mother to death did not destroy his credibility. For sure, he could
not be expected to act and to react to what happened like an adult. Although children have different levels of
intelligence and different degrees of perception, the determination of their capacity to perceive and of their
ability to communicate their perception to the courts still pertained to the trial court, because it concerned a
factual issue and should not be disturbed on appeal in the absence of a strong showing of mistake or
misappreciation on the part of the trial court.

Horacio Salvador vs. Lisa Chua

G.R. No. 212865, July 15, 2015
BERSAMIN, J.:
The accused who fails to appear at the promulgation of the judgment of conviction loses the remedies available
under the Rules of Court against the judgment, specifically: (a) the filing of a motion for new trial or for
reconsideration (Rule 121), and (b) an appeal from the judgment of conviction (Rule 122).
FACTS:
The petitioner and his wife Marine! Salvador were charged in the RTC with estafa penalized under Article 315
(a) of the Revised Penal Code docketed as Criminal Case No. R-PSY-08-04689-CR.3 On March 30, 2011, the
date scheduled for the promulgation of the judgment, their counsel moved for the deferment of the
promulgation inasmuch as the petitioner was then suffering from hypertension. RTC then issued a warrant for
the petitioners arrest. He was apprehended on April 7, 2011, or eight days from the promulgation of the
judgment finding him guilty. The petitioner filed his Motion for Leave to file Notice of Appeal dated April 13,
2011, and attached thereto the medical certificate dated March 30, 2011 purportedly issued by Dr. Paulo
Miguel A. David, certifying that the petitioner had submitted himself to a medical consultation at the Rizal
Medical Center on March 30, 2011 and had been found to be suffering from hypertension. In his order dated
July 1, 2011, RTC Judge Eugenio G. Dela Cruz initially denied the petitioners Motion for Leave to file Notice
of Appeal on the ground of non-compliance with Section 6, Rule 120 of the Rules on Criminal Procedure.
Thereafter, the respondent, who was the complainant in Criminal Case No. R-PSY-08-04689-CR, filed her
Motion for Execution dated July 29, 2011 praying for the issuance of the writ of execution on the civil aspect.
The petitioner opposed it and prayed that he be allowed to post bail pending appeal. Meanwhile, the case was
re-raffled to Judge Francisco G. Mendiola, In his order, Judge Mendiola denied the Prosecution's Motion for
Reconsideration, and fixed bail of F80,000.00 for the provisional liberty of the petitioner. Consequently, the
respondent commenced a special civil action for certiorari in the CA to nullify the order giving due course to
the petitioner's which was granted.

ISSUE: Whether the petitioner had lost his standing in court for his failure to appear at the promulgation of his
conviction?

RULING:
Section 6, Rule 120 of the Rules of Criminal Procedure expressly indicates, the promulgation of the judgment
of conviction may be done in absentia. The accused in such case is allowed a period of 15 days from notice of
the judgment to him or his counsel within which to appeal; otherwise, the decision becomes final. The accused
who fails to appear at the promulgation of the judgment of conviction loses the remedies available under the
Rules of Court against the judgment, specifically: (a) the filing of a motion for new trial or for reconsideration
(Rule 121), and (b) an appeal from the judgment of conviction (Rule 122). However, the Rules of Court permits
him to regain his standing in court in order to avail himself of these remedies within 15 days from the date of
promulgation of the judgment conditioned upon: (a) his surrender; and (b) his filing of a motion for leave of
court to avail himself of the remedies, stating therein the reason for his absence. Should the trial court find that
his absence was for a justifiable cause, he should .be allowed to avail himself of the remedies within 15 days
from notice of the order finding his absence justified and allowing him the available remedies from the
judgment of conviction.
Under Section 6, the personal presence of the petitioner at the promulgation of the was mandatory because the
offense of which he was found guilty was not a light felony or offense. He was charged with and actually found
guilty of estafa. The petitioner had only until April 14, 2011 within which to meet the mandatory requirements
under Section 6 (the promulgation of judgment was March 30, 2011).
In the attempt to regain his right to avail himself of the remedies,the petitioner filed a Motion for Leave to File
a Notice of Appeal, and attached thereto the medical certificate issued by Dr. Paulo Miguel David but he failed
to establish that his absence had been for a justifiable cause because the purported issuer, Dr. Paolo Miguel A.
David, directly impugned the credibility of this certificate.
Even assuming that he had suffered hypertension, which could have validly excused his absence from the
promulgation, the petitioner did not fulfill the other requirement of Section 6, to surrender himself to the trial
court. The term surrender used in the rule visibly necessitated his physical and voluntary submission to the
jurisdiction of the court to suffer any consequences of the verdict against him.

Charlie Te vs. Hon. Augusto Breva

G.R. No. 164974, August 5, 2015
BERSAMIN, J.:
As provided under Section 3, Rule 46 of the Rules of Court, the petition shall contain the full names and
actual addresses of all the petitioners and respondents and the failure of the petitioner to comply with any of
the foregoing requirements shall be sufficient ground for the dismissal of the petition. Also, under Section 1,
Rule 126, a search warrant is an order in writing issued in the name of the People of the Philippines, signed
by a judge and directed to a peace officer, commanding him to search for personal property described therein
and bring it before the court.
FACTS:
It appears that respondent Presiding Judge issued a search warrant against the petitioner upon the application of
respondent Special Investigator U R. Bahinting of the Saranggani District Office of the National Bureau of
Investigation (NBI SARDO) on the basis of his finding of probable cause for a violation of Section 2(b) of
Batas Pambansa Blg. 33, as amended by Presidential Decree No. 1865, for hoarding large quantities of
liquefied petroleum gas (LPG) in steel cylinders belonging to respondent Pryce Gases, Inc. (Pryce Gases). The
application for the search warrant was filed at the instance of Pryce Gases through its letter dated September
28, 2003 to the NBI SARDO complaining about the collection and hoarding by the petitioner of embossed or
name-plated Pryce Gases LPG cylinders in violation of Sections 155, 156, 168 and 169 of Republic Act No.
8293 (Intellectual Property Code of the Philippines).
On October 14, 2003, the petitioner presented his Omnibus Motion to Quash Warrant and/or Suppress
Evidence and to Order Return of Seized Items, raising therein the lack of probable cause, failure to specify the
single offense committed, illegality of the nighttime search, improper application of the plain view doctrine,
and inclusion of other offenses, which was denied.

ISSUE: whether the People of the Philippines should be impleaded as respondents in the petition for certiorari
filed in the Court of Appeals (CA) to annul and set aside the order of the Regional Trial Court (RTC) denying
the petitioner's motion to quash the search warrant issued against him.

RULING:
As provided under Section 3, Rule 46 of the Rules of Court, the petition shall contain the full names and
actual addresses of all the petitioners and respondents and the failure of the petitioner to comply with any of
the foregoing requirements shall be sufficient ground for the dismissal of the petition. Also, under Section 1,
Rule 126, a search warrant is an order in writing issued in the name of the People of the Philippines, signed by
a judge and directed to a peace officer, commanding him to search for personal property described therein and
bring it before the court. In this case, it is admitted that the application for the search warrant was not a
criminal action and the application for the search warrant was not of the same form as that of a criminal action.
Verily, the search warrant is not similar to a criminal action but is rather a legal process that may be likened to
a writ of discovery employed by no less than the State to procure relevant evidence of a crime. In that respect, it
is an instrument or tool, issued under the State's police power and this is the reason why it must issue in the
name of the People of the Philippines. Impleading the People of the Philippines in the petition for certiorari did
not depend on whether or not an actual criminal action had already been commenced in court against the
petitioner. It cannot be denied that the search warrant in question had been issued in the name of the People of
the Philippines, and that fact rendered the People of the Philippines indispensable parties in the special civil
action for certiorari brought to nullify the questioned orders of respondent Presiding Judge. Therefore, the CA
did not abuse its discretion when it denied petitioners petition for certiorari.

Mayor Anwar Berua vs. Court of Appeals

G.R. No. 177600, October 19, 2015
BERSAMIN, J.:
The issuance by the trial court of the warrant of arrest upon filing of the information and supporting papers
implies the determination of probable cause for the offense charged. It is then superfluous for the accused to
seek the judicial determination of probable cause on the pretext that the trial court should still act and proceed
independently of the executive determination of probable cause to charge the proper offense.
FACTS:
Before us are the consolidated cases of G.R. No. 177600 and G.R. No. 178684. G.R. No. 177600 involves the
appeal by petition for review on certiorari of Mayor Anwar Berua Balindong, Lt. Col. Jalandoni Cota, Mayor
Amer Oden Balindong, and Ali Balindong (Balindong, et al.) to assail the Decision promulgated on April 24,
2007 by the Court of Appeals (CA) in CA-G.R. SP No. 97121.1 G.R. No. 178684 relates to the Petition (To
Show Cause Why Respondent Should Not Be Held in Contempt of Court) brought by Zenaida M. Limbona
(Limbona), the private complainant in the criminal cases instituted against Balindong, et al., charging Presiding
Judge Alexander S. Balut of the Regional Trial Court (RTC), Branch 76, in Quezon City with contempt of
court for issuing the order suspending the proceedings in the criminal cases involving Balindong, et al. out of
judicial courtesy.

ISSUE: Whether or not judicial determination of probable cause is proper

RULING:
The language and meaning of the Decision promulgated in G.R. No. 159962, that the proper criminal charges
against Balindong, et al. were two counts of murder with attempted murder, two counts of frustrated murder,
and one count of attempted murder, were clear and forthright enough to require elaboration. Accordingly, the
Court, by thereby ordering the RTC to implement its Resolution relative to the issuance of warrants of arrest
against all the accused, did not need to dwell specifically on the judicial determination of probable cause
independently of the executive determination. We should remind that the trial judge, by issuing the warrants of
arrest, already found the existence of probable cause against Balindong, et al. Indeed, the act of issuing the
warrant of arrest upon filing of the information and supporting papers implied that the judge has determined the
existence of probable cause for the offenses charged. It is then superfluous for the accused to seek the judicial
determination of probable cause on the pretext that the trial court should still act and proceed independently of
the executive determination of probable cause to charge the proper offense. Balindong, et al. could not
reasonably support their position that they could still have the trial court determine the existence of probable
cause in their criminal cases independently of the executive determination of probable cause by the DOJ by
relying on Section 14, Rule 110, in relation to Section 19, Rule 119, both of the Rules of Cout. Ostensibly,
Section 14, supra, applies only to a situation in which there has been a mistake on the part of public prosecutor
in charging the proper offense.

There was no mistake in charging the proper offenses. Balindong, et al. fully exhausted the procedure to
determine the proper offenses to be charged against them by going all the way up to the Secretary of Justice.
Their quest was ultimately settled with finality by the Secretary of Justice denying their second motion for
reconsideration and declaring that such offenses were two counts of murder with attempted murder, two counts
of frustrated murder, and one count of attempted murder. They thereafter attempted to undo such final
determination by filing a third motion for reconsideration in the DOJ, and they initially succeeded because
Secretary Perez directed the Office of the Provincial Prosecutor of Lanao del Sur to cause the filing of the
amended information for double homicide with multiple frustrated homicide against Mayor Anwar Berua
Balindong, Lt. Col. Jalandoni Cota and PO1 Kennedy Balindong, and dropped Amer Oden Balindong and Ali
S. Balindong from the informations. But their success was overturned by the CA, whose nullification of
Secretary Perezs favorable action on their third motion for reconsideration was affirmed in G.R. No. 159962.
Thus, this Court even issued its judicial imprimatur on the probable cause for two counts of murder with
attempted murder, two counts of frustrated murder, and one count of attempted murder. For Balindong, et al. to
rely on Section 14, supra, as basis for the RTC to still reach a determination of probable cause different from
those sanctioned in G.R. No. 159962 would be untenable.

SPECIAL PROCEEDINGS
Anita Mangila vs. Judge Heriberto Pangilinan
G.R. No. 160739, July 17, 2013
BERSAMIN, J.:
Restraint that is lawful and pursuant to a court process cannot be inquired into through habeas corpus.
FACTS:
On June 16, 2003, seven criminal complaints charging petitiOner Anita Mangila and four others with
syndicated estafa in violation of Article 315 of the Revised Penal Code, in relation to Presidential Decree No.
1689, and with violations of Section 7(b) of Republic Act No. 8042 (Migrant Workers and Overseas Filipino
Act of 1995) were filed in the Municipal Trial Court in Cities in Puerto Princesa City (MTCC). The complaints
arose from the recruiting and promising of employment by Mangila and the others to the private complainants
as overseas contract workers in Toronto, Canada, and from the collection of visa processing fees, membership
fees and on-line application the private complainants without lawful authority from the Philippine Overseas
Employment Administration (POEA). Judge Heriberto M. Pangilinan, Presiding Judge of the MTCC,
conducted a preliminary investigation on the complaints. After examining Miguel Aaron Palayon, one of the
complainants, Judge Pangilinan issued a warrant for the arrest of Mangila and her cohorts without bail. On the
next day, the entire records of the cases, including the warrant of arrest, were transmitted to the City Prosecutor
of Puerto Princesa City for further proceedings and appropriate action in accordance with the prevailing rules.
As a consequence, Mangila was arrested on June 18, 2003 and detained at the headquarters on Taft Avenue,
Manila of the National Bureau of Investigation (NBI). Claiming that Judge Pangilinan did not have the
authority to conduct the preliminary investigation; that the preliminary investigation he conducted was not yet
completed when he issued the warrant of arrest; and that the issuance of the warrant of arrest was without
sufficient justification or without a prior finding of probable cause, Mangila filed in the Court of Appeals
(CA)a petition for habeas corpus to obtain her release from detention.

ISSUE: Whether or not the writ of habeas corpus is proper

RULING: No
The object of the writ of habeas corpus is to inquire into the legality of the detention, and, if the detention is
found to be illegal, to require the release of the detainee. Equally well-settled however, is that the writ will not
issue where the person in whose behalf the writ is sought is out on bail, or is in the custody of an officer under
process issued by a court or judge with jurisdiction or by virtue of a judgment or order of a court of record.
There is no question that when the criminal complaints were lodged against Mangila and her cohorts on June
16, 2003,Judge Pangilinan, as the Presiding Judge of the MTCC, was empowered to conduct preliminary
investigations involving all crimes cognizable by the proper court in their respective territorial jurisdictions.
His authority was expressly provided in Section 2, Rule 112 of the Revised Rules of Criminal Procedure.
Under Section 6(b) of Rule 112of the Revised Rules of Criminal Procedure, the investigating judge could issue
a warrant of arrest during the preliminary investigation even without awaiting its conclusion should he find
after an examination in writing and under oath of the complainant and the witnesses in the form of searching
questions and answers that a probable cause existed, and that there was a necessity of placing the respondent
under immediate custody in order not to frustrate the ends of justice.In the context of this rule, Judge
Pangilinan issued the warrant of arrest against Mangila and her cohorts. Consequently, the CA properly denied
Mangilas petition for habeas corpus because she had been arrested and detained by virtue of the warrant issued
for her arrest by Judge Pangilinan, a judicial officer undeniably possessing the legal authority to do so.
It is relevant to point out at this juncture that the authority of the MTC and MTCC judges to conduct
preliminary investigations was removed only effective on October 3, 2005 pursuant to A.M. No. 05-8-26-SC.
With Mangilas arrestand ensuing detention being by virtue of the order lawfully issued by Judge Pangilinan,
the writ of habeas corpuswas not an appropriate remedy to relieve her from the restraint on her liberty. This is
because the restraint, being lawful and pursuant to a court process, could not be inquired into through habeas
corpus.
EVIDENCE
People of the Philippines vs. Rodrigo Salafranca
G.R. No. 173476, February 22, 2012
BERSAMIN, J.:
An ante-mortem declaration of a victim of murder, homicide, or parricide that meets the conditions of
admissibility under the Rules of Court and pertinent jurisprudence is admissible either as a dying declaration
or as a part of the res gestae, or both.
FACTS:
Rodrigo Salafranca y Bello was charged with and tried for murder for the fatal stabbing of Johnny
Bolanon, and was ultimately found guilty of the felony by the Regional Trial Court, Branch 18, in Manila. On
appeal, his conviction was affirmed by the Court of Appeals (CA). CA affirmed the findings and conclusions of
the RTC, citing the dying declaration made to his uncle pointing to Salafranca as his assailant, and Salafrancas
positive identification as the culprit by Mendoza. It stressed that Salafrancas denial and his alibi of being in his
home during the incident did not overcome the positive identification, especially as his unexplained flight after
the stabbing, leaving his home and employment, constituted a circumstance highly indicative of his guilt.
Salafranca has come to the Court on a final appeal, continuing to challenge the credibility of the witnesses who
had incriminated him.

ISSUE: Whether or not the testimony of the witnesses is admissible to prove the accused guilt

RULING: Yes
The RTC and the CA correctly concluded that Mendoza and Estao were credible and reliable. The
determination of the competence and credibility of witnesses at trial rested primarily with the RTC as the trial
court due to its unique and unequalled position of observing their deportment during
testimony, and of assessing their credibility and appreciating their truthfulness, honesty and candor. Absent a
substantial reason to justify the reversal of the assessment made and conclusions reached by the RTC, the CA
as the reviewing court was bound by such assessment and conclusions. Salafranca did not persuasively show a
misappreciation or omission by the RTC. Hence, the Court, in this appeal, is in no position to undo or to
contradict the findings of the RTC and the CA, which were entitled to great weight and respect.
Salafrancas denial and alibi were worthless in the face of his positive identification by Mendoza as the
assailant of Bolanon. The lower courts properly accorded full faith to such incrimination by Mendoza
considering that Salafranca did not even project any ill motive that could have impelled Mendoza to testify
against him unless it was upon the truth. Based on Mendozas account, Salafranca had attacked Bolanon from
behind and had encircled his left arm over the neck (of Bolanon) and delivered the stabbing blow using the
right(hand) and coming from wnnt (sic) up right sideways and another one encircling the blow towards below
the left nipple. Relying on Mendozas recollection of how Salafranca had attacked Bolanon, the RTC found
treachery to be attendant in the killing. This finding the CA concurred with. Mendozas eyewitness account of
the manner of attack remained uncontested by Salafranca who merely insisted on his alibi.
The Court further notes Estaos testimony on the utterance by Bolanon of statements identifying
Salafranca as his assailant right after the stabbing incident. Bolanon had gone to the residence of Estao, his
uncle, to seek help right after being stabbed by Salafranca; that on the way to the hospital, Estao had asked
Bolanon who had stabbed him, and the latter had told Estao that his assailant had been Salafranca; and that
about ten minutes after his admission at the emergency ward of the hospital, Bolanon had expired and had been
pronounced dead. Such circumstances qualified the utterance of Bolanon as both a dying declaration and as part
of the res gestae, considering that the Court has recognized that the statement of the victim an hour before his
death and right after the hacking incident bore all the earmarks either of a dying declaration or part of the res
gestae either of which was an exception to the hearsay rule.
A dying declaration, although generally inadmissible as evidence due to its hearsay character, may
nonetheless be admitted when the following requisites concur, namely: (a) that the declaration must concern
the cause and surrounding circumstances of the declarants death; (b) that at the time the declaration is made, the
declarant is under a consciousness of an impending death; (c) that the declarant is competent as a
witness; and (d) that the declaration is offered in a criminal case for homicide, murder, or parricide, in which
the declarant is a victim. All the requisites were met herein.
A declaration or an utterance is deemed as part of the res gestae and thus admissible in evidence as an
exception to the hearsay rule when the following requisites concur, to wit: (a) the principal act, the res gestae,
is a startling occurrence; (b) the statements are made before the declarant had time to contrive or devise; and (c)
the statements must concern the occurrence in question and its immediately attending circumstances. The
requisites for admissibility of a declaration as part of the res gestae concur herein.

Heirs of Margarita Prodon vs. Heirs of Maximo Alvarez

G.R. No. 170604, September 2, 2013
BERSAMIN, J.:
The Best Evidence Rule applies only when the terms of a written document are the subject of the inquiry. In an
action for quieting of title based on the inexistence of a deed of sale with right to repurchase that purportedly
cast a cloud on the title of a property, therefore, the Best Evidence Rule does not apply, and the defendant is
not precluded from presenting evidence other than the original document.
FACTS:
In their complaint for quieting of title and damages against Margarita Prodon, the respondents averred as the
plaintiffs that their parents, the late spouses Maximo S. Alvarez, Sr. and Valentina Clave, were the registered
owners of that parcel of land covered by Transfer Certificate of Title (TCT) No. 84797 of the Register of Deeds
of Manila; that their parents had been in possession of the property during their lifetime; that upon their
parents deaths, they had continued the possession of the property as heirs, paying the real property taxes due
thereon; that they could not locate the owners duplicate copy of TCT No. 84797, but the original copy of TCT
No. 84797 on file with the Register of Deeds of Manila was intact; that the original copy contained an entry
stating that the property had been sold to defendant Prodon subject to the right of repurchase; and that the entry
had been maliciously done by Prodon because the deed of sale with right to repurchase covering the property
did not exist. Consequently, they prayed that the entry be cancelled, and that Prodon be adjudged liable for
damages. Prodon claimed that the late Maximo Alvarez, Sr.had executed on September 9, 1975 the deed of
sale with right to repurchase; that the deed had been registered with the Register of Deeds and duly annotated
on the title.
During trial, the custodian of the records of the property attested that the copy of the deed of sale with right to
repurchase could not be found in the files of the Register of Deeds of Manila. RTC rendered judgment, finding
untenable the plaintiffs contention that the deed of sale with right to repurchase did not exist. It opined that
although the deed itself could not be presented as evidence in court, its contents could nevertheless be proved
by secondary evidence in accordance with Section 5, Rule 130 of the Rules ofCourt, upon proof of its
execution or existence and of the cause of its unavailability being without bad faith. Itfound that the defendant
had established the execution and existence of the deed.

ISSUE: whether the pre-requisites for the admission of secondary evidence had been complied with

RULING:
Best Evidence Rule was not applicable herein
The Best Evidence Rule stipulates that in proving the terms of a written document the original of the document
must be produced in court. The rule excludes any evidence other than the original writing to prove the contents
thereof, unless the offeror proves: (a) the existence or due execution of the original; (b) the loss and destruction
of the original, or the reason for its non-production in court; and (c) the absence of bad faith on the part of the
offeror to which the unavailability of the original can be attributed. The primary purpose of the Best Evidence
Rule is to ensure that the exact contents of a writing are brought before the court, considering that (a) the
precision in presenting to the court the exact words of the writing is of more than average importance,
particularly as respects operative or dispositive instruments, such as deeds, wills and contracts, because a slight
variation in words may mean a great difference in rights; (b) there is a substantial hazard of inaccuracy in the
human process of making a copy by handwriting or typewriting; and (c) as respects oral testimony purporting
to give from memory the terms of a writing, there is a special risk of error, greater than in the case of attempts
at describing other situations generally. The rule further acts as an insurance against fraud. Verily, if a party is
in the possession of the best evidence and withholds it, and seeks to substitute inferior evidence in its place, the
presumption naturally arises that the better evidence is withheld for fraudulent purposes that its production
would expose and defeat. Lastly, the rule protects against misleading inferences resulting from the intentional
or unintentional introduction of selected portions of a larger set of writings. But the evils of mistransmission of
critical facts, fraud, and misleading inferences arise only when the issue relates to the terms of the writing.
Hence, the Best Evidence Rule applies only when the terms of a writing are in issue. When the evidence sought
to be introduced concerns external facts, such as the existence, execution or delivery of the writing, without
reference to its terms, the Best Evidence Rule cannot be invoked. In such a case, secondary evidence may be
admitted even without accounting for the original.
This case involves an action for quieting of title, a common-law remedy for the removal of any cloud or doubt
or uncertainty on the title to real property by reason of any instrument, record, claim, encumbrance, or
proceeding that is apparently valid or effective, but is, in truth and in fact, invalid, ineffective, voidable, or
unenforceable, and may be prejudicial to said title. In such an action, the competent court is tasked to determine
the respective rights of the complainant and other claimants to place things in their proper place and to make
the one who has no rights to said immovable respect and not disturb the other. The action is for the benefit of
both, so that he who has the right would see every cloud of doubt over the property dissipated, and he can
thereafter fearlessly introduce any desired improvements, as well as use, and even abuse the property. For an
action to quiet title to prosper, two indispensable requisites must concur, namely: (a) the plaintiff or
complainant has a legal or an equitable title to or interest in the real property subject of the action; and (b) the
deed, claim, encumbrance, or proceeding claimed to be casting cloud on his title must be shown to be in fact
invalid or inoperative despite its prima facie appearance of validity or legal efficacy.
The action for quieting of title may be based on the fact that a deed is invalid, ineffective, voidable, or
unenforceable. The terms of the writing may or may not be material to an action for quieting of title, depending
on the ground alleged by the plaintiff. For instance, when an action for quieting of title is based on the
unenforceability of a contract for not complying with the Statute of Frauds, Article 1403 of the Civil Code
specifically provides that evidence of the agreement cannot be received without the writing, or a secondary
evidence of its contents. There is then no doubt that the Best Evidence Rule will come into play. the Best
Evidence Rule was not applicable because the terms of the deed of sale with right to repurchase were not the
issue.

Prodon did not preponderantly establish the existence and due execution of the deed of sale with right to
repurchase
The medical history showingthe number of very serious ailmentsthe late Maximo Alvarez, Sr. had been
suffering from rendered it highly improbable for him to travel from Manila all the way to Meycauayan,
Bulacan, where Prodon and Camilon were then residing in order only to negotiate and consummate the sale of
the property. This high improbability was fully confirmed by his son, Maximo, Jr., who attested that his father
had been seriously ill, and had been in and out of the hospital in 1975. The medical records revealed, too, that
on September 12, 1975, or three days prior to his final admission to the hospital, the late Maximo Alvarez, Sr.
had suffered from [h]igh grade fever, accompanied by chills, vomiting and cough productive of whitish sticky
sputum;had been observed to be conscious but weak and bedridden with his heart having faint
sounds, irregular rhythm, but no murmurs; and his left upper extremity and left lower extremity had suffered
90% motor loss. Truly, Prodons allegation that the deed of sale with right to repurchase had been executed on
September 9, 1975 could not command belief. The second is that the annotation on TCT No. 84797of the deed
of sale with right to repurchase and the entry in the primary entry book of the Register of Deeds did not
themselves establish the existence of the deed. The third is that the respondents remaining in the peaceful
possession of the property was further convincing evidence demonstrating that the late Maximo Alvarez, Sr.
did not execute the deed of sale with right to repurchase.

Far East Bank & Trust Company vs. Robert Mar Chante
G.R. No. 170598, October 9, 2013
BERSAMIN, J.:
FACTS:
Robert Mar Chante, also known as Robert Mar G. Chan (Chan), was a current account depositor of petitioner
Far East Bank & Trust Co. (FEBTC) at its Ongpin Branch. FEBTC issued to him Far East Card No. 05-01120-
5-0 with July 1993 as the expiry date. The card, known as a Do-It-All card to handle credit card and ATM
transactions, was tagged in his current account. As a security feature, a personal identification number (PIN),
known only to Chan as the depositor, was required in order to gain access to the account. Upon the cards
issuance, FEBTC required him as the depositor to key in the six-digit PIN. Thus, with the use of his card and
the PIN, he could then deposit and withdraw funds from his current account from any FEBTC ATM facility,
including the MEGALINK facilities of other member banks that included the Philippine National Bank (PNB).
Civil Case sprang from the complaint brought by petitioner Far East Bank & Trust Co. (FEBTC) in the RTC, to
recover from Chan the principal sum of P770,488.30 representing the unpaid balance of the amount
fraudulently withdrawn from Chans Current Account. FEBTC alleged that Chan had used Far East Card to
withdraw funds totaling P967,000.00 from the PNB-MEGALINK ATM facility at the Manila Pavilion Hotel in
Manila; that the withdrawals were done in a series of 242 transactions with the use of the same machine. The
transactions were processed and recorded by the respective computer systems of PNB and MEGALINK despite
the following circumstances, namely: (a) the offline status of the branch of account (FEBTC Ongpin Branch);
(b) Chans account balance being only P198,511.70 at the time, as shown in the bank statement; (c) the
maximum withdrawal limit of the ATM facility being P50,000.00/day; and (d) his withdrawal transactions not
being reflected in his account, and no debits or deductions from his current account with the FEBTC Ongpin
Branch being recorded. FEBTC added that at the time of the ATM withdrawal transactions, there was an error
in its computer system known as system bug whose nature had allowed Chan to successfully withdraw funds
in excess of his current credit balance of P198,511.70; and that Chan had taken advantage of the system bug to
do the withdrawal transactions. RTC rendered judgment in favor of FEBTC.

ISSUE: Whether or not Chan can be held liable for the withdrawals made from his account

RULING:
Although there was no question that Chan had the physical possession of Far East Card No. 05-01120-5-0 at
the time of the withdrawals, the exclusive possession of the card alone did not suffice to preponderantly
establish that he had himself made the withdrawals, or that he had caused the withdrawals to be made. In his
answer, he denied using the card to withdraw funds from his account on the dates in question, and averred that
the withdrawals had been an inside job. His denial effectively traversed FEBTCs claim of his direct and
personal liability for the withdrawals, that it would lose the case unless it competently and sufficiently
established that he had personally made the withdrawals himself, or that he had caused the withdrawals. The
party who alleges an affirmative fact has the burden of proving it because mere allegation of the fact is not
evidence of it. Verily, the party who asserts, not he who denies, must prove. In civil cases, the burden of proof
is on the party who would be defeated if no evidence is given on either side. This is because our system frees
the trier of facts from the responsibility of investigating and presenting the facts and arguments, placing that
responsibility entirely upon the respective parties. The burden of proof, which may either be on the plaintiff or
the defendant, is on the plaintiff if the defendant denies the factual allegations of the complaint in the manner
required by the Rules of Court; or on the defendant if he admits expressly or impliedly the essential allegations
but raises an affirmative defense or defenses, that, if proved, would exculpate him from liability. Section 1,
Rule 133 of the Rules of Court sets the quantum of evidence for civil actions, and delineates how
preponderance of evidence is determined.
Edgar Munarriz, FEBTCs very own Systems Analyst, admitted that the bug infecting the banks computer
system had facilitated the fraudulent withdrawals. This admission impelled the CA to thoroughly dissect the
situation in order to determine the consequences of the intervention of the system bug in FEBTCs computer
system. Chan might have also honestly believed that he still had the sufficient funds in his current account, as
borne out by his issuance of a check instead after the capture of the card so as not for him to undermine any
financial obligation then becoming due. Nor should his opting to withdraw funds from his account at the ATM
facility in Ermita in less than two days after the questioned withdrawals manifest responsibility on his part, for
he could also be properly presumed to be then still unaware of the situation involving his account. Thirdly, the
RTC ignored the likelihood that somebody other than Chan familiar with the bug infection of FEBTCs
computer system at the time of the withdrawals and adept with the workings of the computer system had
committed the fraud. Fourthly, FEBTC failed to establish that the PNB-MEGALINKs ATM facility at the
Manila Pavilion Hotel had actually dispensed cash in the very significantly large amount alleged during the
series of questioned withdrawals. Chans allegation of an inside job accounting for the anomalous
withdrawals should not be quickly dismissed as unworthy of credence or weight. FEBTC employee Manuel
Del Castillo, another witness for FEBTC, revealed that FEBTC had previously encountered problems of bank
accounts being debited despite the absence of any withdrawal transactions by their owners.
In view of the foregoing, FEBTC did not present preponderant evidence proving Chans liability for the
supposedly fraudulent withdrawals. It thus failed in discharging its burden of persuasion.

Republic of the Philippines vs. Luz Reyes Bakunawa et al

G.R. No. 180418, August 28, 2013
BERSAMIN, J.:
Assets or properties, to be considered as ill-gotten wealth, must be shown to have originated from the
Government itself, and should have been taken by former President Marcos, the members of his immediate
family, relatives, close subordinates and close associates by illegal means. That one served as a government
official or employee during the Marcos administration did not immediately make her a close subordinate or
close associate of former President Marcos.
FACTS:
Civil Case No. 0023 is an action for reconveyance, reversion, accounting, restitution and damages brought by
the Republic against respondents Luz Reyes-Bakunawa, Manuel Bakunawa, Jr., Manuel Bakunawa III,
President Marcos and First Lady Imelda R. Marcos for having allegedly acquired and accumulated ill-gotten
wealth consisting of funds and other property in unlawful concert with one another and in flagrant breach of
trust and of their fiduciary obligations as public officers, with grave abuse of right and power and in brazen
violation of the Constitution and laws of the Republic of the Philippines, thus resulting in their unjust
enrichment. The complaint alleged that respondent Luz Reyes-Bakunawa had served as Imelda Marcos Social
Secretary during the Marcos administration; that it was during that period of her incumbency in that position
that Luz Bakunawa and her husband Manuel Bakunawa had acquired assets, funds and other property grossly
and manifestly disproportionate to her salaries and their other lawful income; and that Luz Bakunawa, by
herself and/or in unlawful concert with Defendants Ferdinand E. Marcos and Imelda R. Marcos, taking undue
advantage of her position, influence and connection with the latter Defendant spouses, for their benefit and
unjust enrichment and in order to prevent disclosure and recovery of assets illegally obtained, engaged in
devices, schemes and stratagems. The Republic prayed for reconveyance to itself of all funds and other
property acquired by respondents abuse of rights and powers.

ISSUE: Whether or not the respondents acquisitition of ill-gotten wealth was proved

RULING:
Preponderance of evidence is required in actions brought to recover ill-gotten wealth
The Republic correctly submits that only a preponderance of evidence was needed to prove its demand for
reconveyance or recovery of ill-gotten wealth. Under the rule on preponderance of evidence, the court is
instructed to find for and to dismiss the case against the defendant should the scales hang in equipoise and there
is nothing in the evidence that tilts the scales to one or the other side. The plaintiff who had the burden of proof
has failed to establish its case, and the parties are no better off than before they proceeded upon their litigation.
In that situation, the court should leave the parties as they are. Moreover, although the evidence of the plaintiff
may be stronger than that of the defendant, there is no preponderance of evidence on the plaintiffs side if its
evidence alone is insufficient to establish its cause of action. Similarly, when only one side is able to present
its evidence, and the other side demurs to the evidence, a preponderance of evidence can result only if the
plaintiffs evidence is sufficient to establish the cause of action. For this purpose, the sheer volume of the
evidence presented by one party cannot tip the scales in its favor. Quality, not quantity, is the primordial
consideration in evaluating evidence.

The evidence of the Republic did not preponderantly establish the ill-gotten nature of the Bakunawas
wealth
Evidentiary substantiation of the allegations of how the wealth was illegally acquired and by whom was
necessary. For that purpose, the mere holding of a position in the Marcos administration did not necessarily
make the holder a close associate within the context of E.O. No.1. According to Republic v. Migrio, the term
subordinate as used in E.O. No. 136 and E.O. No. 237 referred to a person who enjoyed a close association
with President Marcos and/or his wife similar to that of an immediate family member, relative, and close
associate, or to that of a close relative, business associate, dummy, agent, or nominee. Indeed, a prima facie
showing must be made to show that one unlawfully accumulated wealth by virtue of a close association or
relation with President Marcos and/or his wife. It would not suffice, then, that one served during the
administration of President Marcos as a government official or employee. Sandiganbayan correctly ruled that
the evidence of the Republic was able to establish, at best, that Luz Bakunawa had been an employee in
Malacaang Palace during the Marcos administration, and did not establish her having a close relationship with
the Marcoses, or her having abused her position or employment in order to amass the assets subject of this case.
Consequently, Luz Bakunawa could not be considered a close associate or subordinate of the Marcoses within
the context of E.O. No. 1 and E.O. No. 2.
Ruben Manalang et al vs. Bienvenido and Mercedes Bacani
G.R. No. 156995, January 12, 2015
BERSAMIN, J.:
FACTS:
Petitioners Ruben Manalang, Amado Manalang, Carlos Manalang, Concepcion M. Gonzales, Ladislao
Manalang and Luis Manalang were the co-owners of Lot No 4236 with an area of 914 square meters of the
Guagua Cadastre, and declared for taxation purposes in the name of Tomasa B. Garcia. The land was covered
by approved survey plan Ap-03-004154. Adjacent to Lot 4236 was the respondents Lot No. 4235 covered by
Original Certificate of Title (OCT) No. N-216701. In 1997, the petitioners caused the relocation and
verification survey of Lot 4236 and the adjoining lots, and the result showed that the respondents had
encroached on Lot No. 4236 to the extent of 405 square meters. A preliminary relocation survey conducted by
the Lands Management Section of the Department of Environment and Natural Resources (DENR) confirmed
the result on the encroachment. When the respondents refused to vacate the encroached portion and to
surrender peaceful possession thereof despite demands, the petitioners commenced this action for unlawful
detainer on April 21, 1997 in the MTC of Guagua (Civil Case No. 3309), and the casewas assigned to Branch 2
of that court.
On September 17, 1998, the MTC (Branch 2) dismissed Civil Case No. 3309 for lack of jurisdiction based on
its finding that the action involved an essentially boundary dispute that should be properly resolved in an accion
reivindicatoria. On appeal, however, the RTC reversed the MTC (Branch 2), and remanded the case for further
proceedings,5holding that because there was an apparent withholding of possession of the property and the
action was brought within one year from such withholding of possession the proper action was ejectment which
was within the jurisdiction of the MTC. Upon remand, the MTC, Branch 1, ultimately dismissed the complaint
and counterclaim for lack of merit through the decision rendered on August 31, 2000. Once more, the
petitioners appealed to the RTC. At that point, the RTC ordered the petitioners to conduct a relocation survey to
determine their allegation of encroachment, and also heard the testimony of the surveyor. On September 19,
2001, the RTC rendered its judgment whereby it reversed and set aside the MTCs decision of August 31, 2000.

ISSUE: Whether the RTC had authority to receive additional evidence on appeal in an ejectment case

RULING:
RTC, in an appeal of the judgment in an ejectment case, shall not conduct a rehearing or trial de novo. In this
connection, Section 18, Rule 70 of the Rules of Court clearly provides:
Sec. 18. Judgment conclusive only on possession; not conclusive in actions involving title or ownership. x x
x. x x x x
The judgment or final order shall be appealable to the appropriate Regional Trial Court which shall decide the
same on the basis of the entire record of the proceedings had in the court of origin and such memoranda and/or
briefs as may be submitted by the parties or required by the Regional Trial Court.
Hence, the RTC violated the foregoing rule by ordering the conduct of the relocation and verification survey
"in aid of its appellate jurisdiction" and by hearing the testimony of the surveyor, for its doing so was
tantamount to its holding of a trial de novo. The violation was accented by the fact that the RTC ultimately
decided the appeal based on the survey and the surveyors testimony instead of the record of the proceedings
had in the court of origin. Secondly, on whether or not Civil Case No. 3309 was an ejectment case within the
original and exclusive jurisdiction of the MTC, decisive are the allegations of the complaint.

Romeo Caluzor vs. Deogracias Llanillo and Heirs of Lorenzo Llanillo

G.R. No. 155580, July 1, 2015
BERSAMIN, J.:
Agricultural tenancy is not presumed. It is established only by adducing evidence showing that all the essential
requisites of the tenancy relationship concur, namely: (a) the parties are the landowner and the tenant or
agricultural lessee; (b) the subject matter of the relationship is an agricultural land; ( c) there is consent
between the parties to the relationship; ( d) the purpose of the relationship is to bring about agricultural
production; ( e) there is personal cultivation on the part of the tenant or agricultural lessee; and (f) the harvest
is shared between the landowner and tenant or agricultural lessee.
FACTS:
Lorenzo Llanillo (Lorenzo) owned the parcel of land (land) wi.th an area of 90, 101 square meters, more or
less, known as Lot 4196 and situated in Loma de Gato, Marilao, Bulacan. The land was covered by Transfer
Certificate of Title No. 25864 of the Registry of Deeds of Bulacan. The petitioner averred that Lorenzo took
him into the land as a tenant in 1970, giving to him a sketch that indicated the boundaries of the portion he
would be cultivating. To effectively till the land, the petitioner and his family were allowed to build a makeshift
shanty thereon. Even after the death of Lorenzo, the petitioner continued giving a share of his produce to the
family of Lorenzo through Ricardo Martin (Ricardo), Lorenzos overseer. In 1990, respondent Deogracias
Lanillo (Deogracias), the son of Lorenzo, offered to pay the petitioner P17,000.00/hectare of the cultivated land
in exchange for turning his tillage over to Deogracias. In the end, Deogracias did not pay the petitioner. Instead,
on August 5, 1994, Deogracias and persons acting under his orders forcibly ejected the petitioner and his family
by levelling their shanty and plantation with the use of a bulldozer. The efforts of the Barangay Agrarian
Reform Council to conciliate failed; hence, the authority to file a case was issued to the petitioner.
The petitioner instituted this case against Deogracias in the Office of the Provincial Agrarian Reform
Adjudicator (PARAD) in Malolos, Bulacan, demanding the payment of disturbance compensation. He amended
his complaint to implead Moldex Realty Corporation (Moldex) as an additional defendant upon discovering
that the latter had entered the land to develop it into a residential subdivision. He prayed for the restoration of
his possession of the tilled land, and the payment of disturbance compensation. Meanwhile, on April 12, 1995,
the Secretary of the Department of Agrarian Reform (DAR) granted the application for the conversion of the
land from agricultural to residential and commercial uses filed by Deogarcias, through Moldex as his attorney-
in-fact.

ISSUE: Whether or not the petitioner resorted to the wrong remedy of a special civil action for certiorari and
should be dismissed

RULING:
It is clear that the CA promulgated the assailed decision in the exercise of its appellate jurisdiction to review
and pass upon the DARABs adjudication by of the petitioners appeal of the PARADs ruling. As such, his
only proper recourse from such decision of the CA was to further appeal to the Court by petition for review on
certiorari under Rule 45 of the Rules of Court. Despite his allegation of grave abuse of discretion against the
CA, he could not come to the Court by special civil action for certiorari. The remedies of appeal and certiorari
were mutually exclusive, for the special civil action for certiorari, being an extraordinary remedy, is available
only if there is no appeal, or other plain, speedy and adequate remedy in the ordinary course of law. In
certiorari, only errors of jurisdiction are to be addressed by the higher court, such that a review of the facts and
evidence is not done; but, in appeal, the superior court corrects errors of judgment, and in so doing reviews
issues of fact and law to cure errors in the appreciation and evaluation of the evidence. Based on such
distinctions, certiorari cannot be a substitute for a lost appeal.
It is obvious that all that the petitioner wants the Court to do is to revisit and review the facts and records
supposedly substantiating his claim of tenancy and his demand for consequential disturbance compensation. He
has not thereby raised any jurisdictional error by the CA, and has not shown how the CA capriciously or
whimsically exercised its judgment as to be guilty of gravely abusing its discretion.

Alejandra Arado Heirs vs. Anacleto Alcoran and Elenette Sunjaco

G .R. No. 163362, July 8, 2015
BERSAMIN, J.:
The burden of proof to establish the averments of the complaint by preponderance of evidence pertained to the
petitioners as the plaintiffs. "Preponderance of evidence" is the weight, credit, and value of the aggregate
evidence on either side and is usually considered to be synonymous with the term "greater weight of the
evidence" or "greater weight of the credible evidence."
FACTS:
Raymundo Alcoran and Joaquina Arado were married and had a son named Nicolas Alcoran. In turn, Nicolas
married Florencia Limpahan, but their union had no offspring. During their marriage, however, Nicolas had an
extramarital affair with Francisca Sarita who gave birth to Anacleto who married Elenette.
Upon death, Joaquinas siblings filed in the RTC a complaint for recovery of property and damages against
Anacleto and Elenette.Eight of the subjects properties belonged to Raymundo and the last two had been the
paraphemal properties of Joaquina. It was contended by the petitioners that Anacleto was not entitled to be
Nicholas heir and Joaquinas heir as the will was void for not having been executed according to the
formalities of the law, and the same did not reflect the true intention of Joaquina and that they were the rightful
heirs to the properties. The defendants countered that Anacleto was expressly recognized by Nicolas as the
latter's son, a fact evidenced by the certificate of birth of Anacleto.
RTC dismissed the complaint and ruled that he was really the acknowledged illegitimate son of Nicolas. It cited
the certificate of birth of Anacleto, which proved that Nicolas had himself caused the registration of Anacleto' s
birth. It observed that the name of Nicolas appeared under the column "Remarks" in the register of births,
which was the space provided for the name of the informant. They failed to refute such entry and became
conclusive with respect to the facts contained therein. Further, baptismal certificate, a picture taken during the
wake of Nicolas showing the young Anacleto being carried by Joaquina, and also Nicolas' wife, Florencia, his
school records, and Joaquinas consent to marriage, and Joaquinas will bequeathing the subject properties to
Anacleto were sufficient basis. The CA affirmed the decision of RTC.

ISSUE: Whether the petitioners were able prove that Anacleto was not an acknowledged illegitimate son of
Nicolas

RULING:
The burden of proof to establish the averments of the complaint by preponderance of evidence pertained to the
petitioners as the plaintiffs. "Preponderance of evidence" is the weight, credit, and value of the aggregate
evidence on either side and is usually considered to be synonymous with the term "greater weight of the
evidence" or "greater weight of the credible evidence." Preponderance of evidence is a phrase which, in the last
analysis, means probability of the truth. It is evidence which is more convincing to the court as worthy of belief
than that which is offered in opposition thereto.
The petitioners did not discharge their burden of proof. The plaintiffs did not rebut the filiation of Anacleto by
contrary evidence.
The birth certificate of Anacleto appearing in the Register of Births of the Municipality of Bacong, Negros
Oriental showed that Nicolas had himself caused the registration of the birth of Anacleto. The showing was by
means of the name of Nicolas appearing in the column "Remarks", the space provided for the name of the
informant of the live birth to be registered. Considering that Nicolas, the putative father, had a direct hand in
the preparation of the birth certificate, reliance on the birth certificate of Anacleto as evidence of his paternity
was fully warranted.
However, Anacleto's baptismal certificate was of no consequence in determining his filiation. As it was ruled
that "while a baptismal certificate may be considered a public document, it can only serve as evidence of the
administration of the sacrament on the date specified but not the veracity of the entries with respect to the
child's paternity." Further, he weight accorded by the R TC and the CA to the picture depicting the young
Anacleto in the arms of Joaquina as she stood beside the coffin of the departed Nicolas was also undeserved. At
best, the picture merely manifested that it was Joaquina who had acknowledged her filiation with Anacleto. The
school records of Anacleto, which evinced that Joaquina was the guardian of Anacleto in his grade school
years, and the marriage contract between Anacleto and Elenette, which indicated that Joaquina had given
consent to Anacleto's marriage, did not have the evidentiary value accorded by the RTC and the CA. Joaquina's
apparent recognition of Anacleto mattered little, for the recognition "must be made personally by the parent
himself or herself, not by any brother, sister or relative; after all, the concept of recognition speaks of a
voluntary declaration by the parent, of if the parent refuses, by judicial authority, to establish the paternity or
maternity of children born outside wedlock."
The lack of probative value of the respondents' aforecited corroborative evidence notwithstanding, Anacleto 's
recognition as Nicolas' illegitimate child remained beyond question in view of the showing that Nicolas had
personally and directly acknowledged Anacleto as his illegitimate son.
 A CADEMICUS REVIEW CENTER
Dean Ferdinand A. Tan

TAXATION LAW CASES ( 2012 - 2016)

J. BERSAMIN

H. Tambunting Pawnshop Inc. vs. Commissioner of Internal Revenue

G.R. No . 173373, July 29, 2013
BERSAMIN, J.:
To be entitled to claim a tax deduction, the taxpayer must competently establish the factual and
documentary bases of its claim.

FACTS:
H. Tambunting Pawnshop, Inc., a domestic corporation duly licensed and authorized to engage in the
pawnshop business, appeals the adverse decision promulgated on April 24, 2006, whereby the Court of
Tax Appeals En Bane (CTA En Banc) affirmed the decision of the CTA First Division ordering it to pay
deficiency income taxes in the amount of P4,536,687.15 for taxable year 1997, plus 20% delinquency
interest computed from August 29, 2000 until full payment, but cancelling the compromise penalties for
lack of basis. Bureau of Internal Revenue (BIR), through then Acting Regional Director Lucien E. Sayuno
of Revenue Region No. 6 in Manila, issued assessment notices and demand letters, all numbered 32-1-97,
assessing Tambunting for deficiency percentage tax, income tax and compromise penalties for taxable
year 1997. Tambunting instituted an administrative protest against the assessment notices and demand
letters with the Commissioner of Internal Revenue. Tambunting brought a petition for review in the CTA,
pursuant to Section 228 of the National Internal Revenue Code of 1997, citing the inaction of the
Commissioner of Internal Revenue on its protest within the 180-day period prescribed by law

ISSUE: Whether or not petitioner is entitled to tax deductions

RULING: No
At the outset, the Court agrees with the CTA En Banc that because this case involved assessments relating
to transactions incurred by Tambunting prior to the effectivity of Republic Act No. 8424 (National
Internal Revenue Code of 1997, or NIRC of 1997), the provisions governing the propriety of the
deductions was Presidential Decree 1158 (NIRC of 1977). The rule that tax deductions, being in the
nature of tax exemptions, are to be construed in strictissimi juris against the taxpayer is well settled.20
Corollary to this rule is the principle that when a taxpayer claims a deduction, he must point to some
specific provision of the statute in which that deduction is authorized and must be able to prove that he is
entitled to the deduction which the law allows. An item of expenditure, therefore, must fall squarely
within the language of the law in order to be deductible. A mere averment that the taxpayer has incurred
a loss does not automatically warrant a deduction from its gross income.
The requisites for the deductibility of ordinary and necessary trade or business expenses, like those paid
for security and janitorial services, management and professional fees, and rental expenses, are that: (a)
the expenses must be ordinary and necessary; (b) they must have been paid or incurred during the taxable
year; (c) they must have been paid or incurred in carrying on the trade or business of the taxpayer; and (d)
they must be supported by receipts, records or other pertinent papers.
As the CTA En Banc held, Tambunting did not properly prove that it had incurred losses. The subasta
books it presented were not the proper evidence of such losses from the auctions because they did not
reflect the true amounts of the proceeds of the auctions due to certain items having been left unsold after
the auctions. The rematado books did not also prove the amounts of capital because the figures reflected
therein were only the amounts given to the pawnees. It is interesting to note, too, that the amounts
received by the pawnees were not the actual values of the pawned articles but were only fractions of the
real values.
Luzon Hydro Corp. vs. CIR
G.R. No . 188260, November 13, 2013
BERSAMIN, J.:
A claim for refund or tax credit for unutilized input VAT may be allowed only if the following requisites
concur, namely: (a) the taxpayer is VAT-registered; (b) the taxpayer is engaged in zero-rated or
effectively zero-rated sales; (c) the input taxes are due or paid; (d) the input taxes are not transitional
input taxes; (e) the input taxes have not been applied against output taxes during and in the succeeding
quarters; (f) the input taxes claimed are attributable to zero-rated or effectively zero-rated sales; (g) for
zero-rated sales under Section 106(A)(2)(1) and (2); 106(B); and 108(B)(1) and (2), the acceptable
foreign currency exchange proceeds have been duly accounted for in accordance with the rules and
regulations of the Bangko Sentral ng Pilipinas; (h) where there are both zero-rated or effectively
zerorated sales and taxable or exempt sales, and the input taxes cannot be directly and entirely
attributable to any of these sales, the input taxes shall be proportionately allocated on the basis of sales
volume; and (i) the claim is filed within two years after the close of the taxable quarter when such sales
were made.

FACTS:
The petitioner, a corporation duly organized under the laws of the Philippines, has been registered with
the Bureau of Internal Revenue (BIR) as a VAT taxpayer under Taxpayer Identification No. 004-266-526.
It was formed as a consortium of several corporations, namely: Northern Mini Hydro Corporation,
Aboitiz Equity Ventures, Inc., Ever Electrical Manufacturing, Inc. and Pacific Hydro Limited. Pursuant to
the Power Purchase Agreement entered into with the National Power Corporation (NPC), the electricity
produced by the petitioner from its operation of the Bakun Hydroelectric Power Plant was to be sold
exclusively to NPC. Relative to its sale to NPC, the petitioner was granted by the BIR a certificate for
Zero Rate for VAT purposes in the periods from January 1, 2000 to December 31, 2000; February 1, 2000
to December 31, 2000 (Certificate No. Z-162-2000); and from January 2, 2001 to December 31, 2001
(Certificate No. 2001-269). The petitioner alleged herein that it had incurred input VAT in the amount of
P9,795,427.89 on its domestic purchases of goods and services used in its generation and sales of
electricity to NPC in the four quarters of 2001; and that it had declared the input VAT of P9,795,427.89
in its amended VAT returns for the four quarters on 2001. Petitioner filed a written claim for refund or tax
credit relative to its unutilized input VAT for the period from October 1999 to October 2001 aggregating
P14,557,004.38.7 Subsequently, on July 24, 2002, it amended the claim for refund or tax credit to cover
the period from October 1999 to May 2002 for P20,609,047.56. Respondent Commissioner of Internal
Revenue (Commissioner) did not ultimately act on the petitioners claim despite the favorable
recommendation. Hence, on April 14, 2003, the petitioner filed its petition for review in the CTA,
praying for the refund or tax credit certificate (TCC) corresponding to the unutilized input VAT paid for
the four quarters of 2001 totalling P9,795,427.88, which was denied.

ISSUE: Whether or not petitioner is entitled to tax refund

RULING: No
A claim for refund or tax credit for unutilized input VAT may be allowed only if the following requisites
concur, namely: (a) the taxpayer is VAT-registered; (b) the taxpayer is engaged in zero-rated or
effectively zero-rated sales; (c) the input taxes are due or paid; (d) the input taxes are not transitional input
taxes; (e) the input taxes have not been applied against output taxes during and in the succeeding quarters;
(f) the input taxes claimed are attributable to zero-rated or effectively zero-rated sales; (g) for zero-rated
sales under Section 106(A)(2)(1) and (2); 106(B); and 108(B)(1) and (2), the acceptable foreign currency
exchange proceeds have been duly accounted for in accordance with the rules and regulations of the
Bangko Sentral ng Pilipinas; (h) where there are both zero-rated or effectively zerorated sales and taxable
or exempt sales, and the input taxes cannot be directly and entirely attributable to any of these sales, the
input taxes shall be proportionately allocated on the basis of sales volume; and (i) the claim is filed within
two years after the close of the taxable quarter when such sales were made.
Petitioner did not produce evidence showing that it had zero-rated sales for the four quarters of taxable
year 2001. As the CTA En Banc precisely found, the petitioner did not reflect any zero-rated sales from
its power generation in its four quarterly VAT returns, which indicated that it had not made any sale of
electricity. Had there been zero-rated sales, it would have reported them in the returns. Indeed, it carried
the burden not only that it was entitled under the substantive law to the allowance of its claim for refund
or tax credit but also that it met all the requirements for evidentiary substantiation of its claim before the
administrative official concerned, or in the de novo litigation before the CTA in Division.
Although the petitioner has correctly contended here that the sale of electricity by a power generation
company like it should be subject to zero-rated VAT under Republic Act No. 9136, its assertion that it
need not prove its having actually made zero-rated sales of electricity by presenting the VAT official
receipts and VAT returns cannot be upheld. It ought to be reminded that it could not be permitted to
substitute such vital and material documents with secondary evidence like financial statements.
We further see no reason to grant the prayer of the petitioner for the remand of this case to enable it to
present before the CTA newly discovered evidence consisting in VAT official receipts. Ordinarily, the
concept of newly discovered evidence is applicable to litigations in which a litigant seeks a new trial or
the re-opening of the case in the trial court. Seldom is the concept appropriate when the litigation is
already on appeal, particularly in this Court. The absence of a specific rule on newly discovered evidence
at this late stage of the proceedings is not without reason. The propriety of remanding the case for the
purpose of enabling the CTA to receive newly discovered evidence would undo the decision already on
appeal and require the examination of the pieces of newly discovered evidence, an act that the Court
could not do by virtue of its not being a trier of facts. Verily, the Court has emphasized in Atlas
Consolidated Mining and Development Corporation v. Commissioner of Internal Revenue that a
judicial claim for tax refund or tax credit brought to the CTA is by no means an original action but an
appeal by way of a petition for review of the taxpayers unsuccessful administrative claim; hence, the
taxpayer has to convince the CTA that the quasi-judicial agency a quo should not have denied the claim,
and to do so the taxpayer should prove every minute aspect of its case by presenting, formally offering
and submitting its evidence to the CTA, including whatever was required for the successful prosecution
of the administrative claim as the means of demonstrating to the CTA that its administrative claim should
have been granted in the first place.

Commissioner of Customs vs. Oilink International Corporation

G.R. No. 161759, July 02, 2014
BERSAMIN, J.:

FACTS:
Union Refinery Corporation was established under the Corporation Code of the Philippines. In
the course of its business undertakings, URC imported oil products into the country. On January 11, 1996,
Oilink was incorporated, URC and Oilink having interlocking directors when Oilink started its business.
In applying for and in expediting the transfer of the operators name for the Customs Bonded Warehouse
then operated by URC, Esther Magleo, the Vice-President and General Manager of URC, sent a to
manifest that URC and Oilink had the same Board of Directors and that Oilink was 100% owned by
URC.
Oscar Brillo, the District Collector of the Port of Manila, formally demanded that URC pay the
taxes and duties on its oil imports. On April 16, 1998, Brillo made another demand letter to URC.URC,
through its counsel, responded to the demands by seeking the landed computations of the assessments,
and challenged the inconsistencies of the demands.
Customs Commissioner Pedro C. Mendoza formally directed that URC pay the amount of
P119,223,541.71 representing URCs special duties, VAT, and Excise Taxes that it had failed to pay. On
December 23, 1998, upon his assumption of office, Customs Commissioner Nelson Tan transmitted
another demand letter to URC affirming the assessment of P99,216,580.10 by Commissioner Mendoza.
Magleo, in behalf of URC, replied by letter to Commissioner Tans affirmance by denying liability,
insisting instead that only P28,933,079.20 should be paid by way of compromise.Commissioner Tan
responded by rejecting Magleos proposal.
On May 24, 1999, Manuel Co, URCs President, conveyed to Commissioner Tan URCs
willingness to pay only P94,216,580.10, of which the initial amount of P28,264,974.00 would be taken
from the collectibles of Oilink from the National Power Corporation, and the balance to be paid in
monthly installments over a period of three years to be secured with corresponding post-dated checks and
its future available tax credits.On July 2, 1999, Commissioner Tan made a final demand for the total
liability of P138,060,200.49 upon URC and Oilink. Also on July 8, 1999, Oilink formally protested the
assessment on the ground that it was not the party liable for the assessed deficiency taxes.
Commissioner Tan communicated in writing the detailed computation of the tax liability,
stressing that the Bureau of Customs (BoC) would not issue any clearance to Oilink unless the amount of
P138, 060,200.49 demanded as Oilinks tax liability be first paid. Thus, on July 30, 1999, Oilink appealed
to the CTA. The CTA rendered its decision declaring as null and void the assessment of the
Commissioner of Customs. Aggrieved, the Commissioner of Customs brought a petition for review in the
CA.
On the issue of the jurisdiction of the CTA, the CA found that the petitioners submission is untenable. As
to whether or not the Commissioner of Customs could lawfully pierce the veil of corporate fiction in
order to treat Oilink as the mere alter ego of URC, the CA concurred with the CTA. Hence, this appeal,
whereby the Commissioner of Customs reiterates the raised in the CA.

ISSUES:
1. Whether or not the CTA gravely erred in holding that it had jurisdiction over the subject matter;
2. Whether or not the CTA gravely erred in holding that Oilink had a cause of action; and
3. Whether or not the CTA gravely erred in holding that the Commissioner of Customs could not
pierce the veil of corporate fiction.

RULING:
The CTA had jurisdiction over the controversy
There is no question that the CTA had the jurisdiction over the case. Republic Act No. 1125, the law
creating the CTA, defined the appellate jurisdiction of the CTA. Nonetheless, the Commissioner of
Customs contends that the CTA should not take cognizance of the case because of the lapse of the 30-day
period within which to appeal, arguing that on November 25, 1998 URC had already received the BoCs
final assessment demanding payment of the amount due within 10 days, but filed the petition only on July
30, 1999.alawred
We rule against the Commissioner of Customs. The CTA correctly ruled that the reckoning date for
Oilinks appeal was July 12, 1999, not July 2, 1999, because it was on the former date that the
Commissioner of Customs denied the protest of Oilink. Clearly, the filing of the petition on July 30, 1999
by Oilink was well within its reglementary period to appeal. The insistence by the Commissioner of
Customs on reckoning the reglementary period to appeal from November 25, 1998, the date when URC
received the final demand letter, is unwarranted. We note that the November 25, 1998 final demand letter
of the BoC was addressed to URC, not to Oilink. As such, the final demand sent to URC did not bind
Oilink unless the separate identities of the corporations were disregarded in order to consider them as one.

NO. Oilink had a valid cause of action

The Commissioner of Customs posits that Oilink did not exhaust its administrative remedies under
Section 2308 of the Tariff and Customs Code by paying the assessment under protest.
The position of the Commissioner of Customs lacks merit. The CA correctly held that the principle of
non-exhaustion of administrative remedies was not an iron-clad rule because there were instances in
which the immediate resort to judicial action was proper. This was one such exceptional instance when
the principle did not apply. As the records indicate, the Commissioner of Customs already decided to
deny the protest by Oilink on July 12, 1999, and stressed then that the demand to pay was final. In that
instance, the exhaustion of administrative remedies would have been an exercise in futility because it was
already the Commissioner of Customs demanding the payment of the deficiency taxes and duties.

NO. There was no ground to pierce the veil of corporate existence

A corporation, upon coming into existence, is invested by law with a personality separate and distinct
from those of the persons composing it as well as from any other legal entity to which it may be related.
The separate and distinct personality of the corporation is, however, a mere fiction established by law for
convenience and to promote the ends of justice. It may not be used or invoked for ends that subvert the
policy and purpose behind its establishment, or intended by law to which the corporation owes its being.
This is true particularly when the fiction is used to defeat public convenience, to justify wrong, to protect
fraud, to defend crime, to confuse legitimate legal or judicial issues, to perpetrate deception or otherwise
to circumvent the law. In such instances, the veil of corporate entity will be pierced or disregarded with
reference to the particular transaction involved.
Indeed, the doctrine of piercing the corporate veil has no application here because the Commissioner of
Customs did not establish that Oilink had been set up to avoid the payment of taxes or duties, or for
purposes that would defeat public convenience, justify wrong, protect fraud, defend crime, confuse
legitimate legal or judicial issues, perpetrate deception or otherwise circumvent the law. It is also
noteworthy that from the outset the Commissioner of Customs sought to collect the deficiency taxes and
duties from URC, and that it was only on July 2, 1999 when the Commissioner of Customs sent the
demand letter to both URC and Oilink. That was revealing, because the failure of the Commissioner of
Customs to pursue the remedies against Oilink from the outset manifested that its belated pursuit of
Oilink was only an afterthought.

Agriex Co. Ltd. Vs. Hon. Titus Villanueva

G.R. No. 158150, September 10, 2014
BERSAMIN, J.:
Although RA No. 7227 is silent as to the person or entity vested with the authority to seize and forfeit or
detain goods and articles entering the Subic Bay Freeport, the implementing rules and regulations (IRR)
of RA No. 7227 provides that customs officers may seize any article found during a Customs search upon
entering or leaving the SBF to be in violation of any provision of the customs laws for which a seizure is
authorized, and such seizure shall be disposed of according to the customs laws. Articles which are
prohibited or excluded from the SBF under the rules and regulations of the SBMA which are found by the
Customs officials during an audit, examination or check within the SBF may be seized by them and turned
over to the SBMA for disposition.

FACTS:
The petitioner, a foreign corporation whose principal office was in Bangkok, Thailand, entered
into a contract of sale with PT. Gloria Mitra Niagatama International of Surabaya, Indonesia for 180,000
bags of Thai white rice. Later on, it entered into another contract of sale with R&C Agro Trade of Cebu
City for 20,000 bags of Thai white rice. It chartered the vessel MV Hung Yen to transport the 200,000
bags of Thai white rice to the Subic Free Port for transshipment to their designated consignees in the Fiji
Islands and Indonesia (for the 180,000 bags), and in Cebu City (for the 20,000 bags). The MV Hung Yen
arrived at the Subic Free Port on August 20, 2001 with the inward foreign manifest indicating the final
destinations of the shipment. However, the Sea Port Department of the Subic Bay Metropolitan Authority
allowed the vessel to berth only 22 days later, or on September 11, 2001. SBMA advised the vessel agent
to secure from the National Food Authority an amendment of the import permit issued in favor of R&C
Agro Trade to change the discharging port from the Port of Cebu to the Port of Subic.
Due to the delay in the berthing and unloading of the cargo from the vessel, the petitioner,
through its agent in Subic, applied for a vessel exit clearance to allow the MV Hung Yen to sail for the
Labuan Free Port in Malaysia which was granted by the Bureau of Customs. Despite the issuance of the
clearance, the MV Hung Yen did not set sail for the Labuan Free Port.
On September 10, 2001, the petitioner requested permission from the Bureau of Customs to
unload the entire shipment of 200,000 bags of Thai white rice because the MV Hung Yen must return to
Vietnam. Upon the recommendation of Atty. Enriquez and Atty. Heraldo, respondent Commissioner
Villanueva issued his 1st Indorsement directing respondent Collector of Customs Bibit to issue a Warrant
of Seizure and Detention (WSD) against the 20,000 bags of Thai white rice consigned to R&C Agro
Trade. Accordingly, Collector Bibit issued WSD No. 2001-13 against the 20,000 bags of Thai white rice
consigned to R&C Agro Trade notwithstanding that no bag of rice had yet been unloaded from the vessel.
After the unloading, transfer and storage of the rice shipment at SBMAs warehouse, Collector Bibit
issued amended WSDs to cover the MV Hung Yen and the remaining 180,000 bags of Thai white rice
intended for transshipment.
On October 4, 2001, the petitioner filed with the Bureau of Customs in the Port of Subic an
Urgent Motion to Quash Warrant of Seizure, inclusive of WSD No. 2001-13 and WSD No. 2001-
13B.Collector Bibit quashed WSD No. 2001-13A over the MV Hung Yen on the ground that the vessel
was not chartered or leased.
Pending hearing of the seizure proceedings vis--vis the rice shipments, Collector Bibit issued a
Notice of Sale setting therein the auction sale of the 200,000 bags of Thai white rice. The petitioner filed
a Manifestation and Urgent Motion for Reconsideration but Collector Bibit did not act on the motion.
Consequently, the petitioner instituted the petition for certiorari and prohibition in the CA on November
12, 2001 (with prayer for the issuance of a temporary restraining order and/or writ of injunction).
Accordingly, Commissioner Villanueva issued his memorandum dated directing Collector Bibit not to
proceed with the scheduled auction of the 180,000 bags of Thai white rice until further orders from his
office.
 On November 22, 2001, the CA issued a temporary restraining order enjoining the respondents to
desist from holding the scheduled public auction. Meanwhile, on November 14, 2001, Collector Bibit
denied the motion for the quashal of the warrant of seizure issued against the rice shipments, and ordered
their forfeiture in favor of the Government. The petitioner appealed the November 14, 2001 ruling by
Collector Bibit to Commissioner Villanueva, the latter granted the motion for settlement and accordingly
order the release of the 20,000 bags of Thai rice to claimants.
On July 22, 2002, Commissioner Antonio M. Bernardo, who had meanwhile succeeded
Commissioner Villanueva, released the 2nd Indorsement directing the sale of the 180,000 bags of Thai
white rice at public auction. Eventually, the auction sale went on as scheduled, and the proceeds were
deposited in the Land Bank of the Philippines, Subic Branch, under Bureau of Customs Trust Fund II
Account No. 1572100800. On November 18, 2002, the CA rendered its assailed judgment denying the
petition for certiorari and prohibition. The petitioner moved for reconsideration, but the CA denied the
motion. Hence, this petition for review.

ISSUES:
1. Whether or not the CA erred in not declaring the seizure proceedings null and void for lack of
jurisdiction over petitioners rice shipment.
2. Whether or not the CA erred in finding that the petitioners remedy is an appeal to the Court of
Tax Appeals.

RULING:
The Subic Special Economic Zone, or the Subic Bay Freeport, was established pursuant to Section 12
of Republic Act No. 7227 (The Bases Conversion and Development Act of 1992), to be operated and
managed as a special customs territory. On the other hand, the Subic Bay Metropolitan Authority
(SBMA) was created under Section 13 of RA No. 7227 to serve as an operating and implementing arm
of the Conversion Authority within the SBF.
The petitioner claims that the Collector of Customs had no jurisdiction to issue WSD No. 2001-13B
and the Notice of Sale concerning the 180,000 bags of Thai white rice, which had entered the SBF only
for transshipment to other countries. It insists that the auction sale of the 180,000 bags was null and void
for failing to comply with Executive Order No. 272, which required presidential approval when the
amount to be generated from the sale was at least P50 Million. The Court declares that the Collector of
Customs was authorized to institute seizure proceedings and to issue WSDs in the Subic Bay Freeport,
subject to the review by the Commissioner of Customs. Accordingly, the proper remedy to question the
order or resolution of the Commissioner of Customs was an appeal to the CTA, not to the CA.
Although RA No. 7227 is silent as to the person or entity vested with the authority to seize and forfeit
or detain goods and articles entering the Subic Bay Freeport, the implementing rules and regulations
(IRR) of RA No. 7227 provides that customs officers may seize any article found during a Customs
search upon entering or leaving the SBF to be in violation of any provision of the customs laws for which
a seizure is authorized, and such seizure shall be disposed of according to the customs laws. Articles
which are prohibited or excluded from the SBF under the rules and regulations of the SBMA which are
found by the Customs officials during an audit, examination or check within the SBF may be seized by
them and turned over to the SBMA for disposition.
Customs Administrative Order No. 4-93 (CAO 4-93), also known as the Rules and Regulations for
Customs Operations in the Subic Special Economic and Freeport Zone, similarly provides; Any
prohibited or excluded articles found upon search, or through any examination, audit or check of articles
in the Zone by Customs may be seized by Customs for violations of Tariff and Customs Code of the
Philippines as amended and disposed of in accordance with law.
Under these statutory provisions, both the SBMA and the Bureau of Customs have the power to seize
and forfeit goods or articles entering the Subic Bay Freeport, except that SBMAs authority to seize and
forfeit goods or articles entering the Subic Bay Freeport has been limited only to cases involving
violations of RA No. 7227 or its IRR. There is no question therefore, that the authority of the Bureau of
Customs is larger in scope because it covers cases concerning violations of the customs laws.
The authority of the Bureau of Customs to seize and forfeit goods and articles entering the Subic Bay
Freeport does not contravene the nature of the Subic Bay Freeport as a separate customs authority.
Indeed, the investors can generally and freely engage in any kind of business as well as import into and
export out goods with minimum interference from the Government. In this case, an examination of the
shipment by the customs officials pursuant to Mission Order No. 06-2001 initially revealed no cause to
hold the release of the 180,000 bags of rice. However, further investigation led to the discovery that the
consignees of the 180,000 bags of rice in Indonesia were non-existent, and the consignee in the Fiji
Islands denied being involved in the importation of rice.
The findings constituted sufficient probable cause, as required by Section 2535 of the Tariff and
Customs Code, that violations of the customs laws, particularly Section 102(k) and Section 2530, (a), (f)
and (l), par. 3, 4, and 5 of the Tariff and Customs Code,had been committed. For that reason, the
institution of the seizure proceedings and the issuance of WSD No. 2001-13B by the Collector of
Customs were well within the jurisdiction of the Bureau of Customs.
It is well settled that the Collector of Customs has exclusive jurisdiction over seizure and forfeiture
proceedings, and regular courts cannot interfere with his exercise thereof or stifle or put it at naught. The
Collector of Customs sitting in seizure and forfeiture proceedings has exclusive jurisdiction to hear and
determine all questions touching on the seizure and forfeiture of dutiable goods. Regional trial courts are
devoid of any competence to pass upon the validity or regularity of seizure and forfeiture proceedings
conducted by the BOC and to enjoin or otherwise interfere with these proceedings. Regional trial courts
are precluded from assuming cognizance over such matters even through petitions for certiorari,
prohibition or mandamus.

Verily, the rule is that from the moment imported goods are actually in the possession or control of
the Customs authorities, even if no warrant for seizure or detention had previously been issued by the
Collector of Customs in connection with the seizure and forfeiture proceedings, the BOC acquires
exclusive jurisdiction over such imported goods for the purpose of enforcing the customs laws, subject to
appeal to the Court of Tax Appeals whose decisions are appealable to this Court.
The issuance of the October 18, 2001 Notice of Sale was merely an incident of the seizure
proceedings commenced by the Collector of Customs. Consequently, the correctness of its issuance was
necessarily subsumed to the determination of the propriety of the seizure proceedings, a matter that was
within the exclusive jurisdiction of the Bureau of Customs. In that context, the proper recourse of the
petitioner from the Consolidated Order of Commissioner Villanueva, which reviewed the November 14,
2001 action of Collector Bibit, was an appeal in due course to the CTA, in accordance with Section 7(4)
of RA No. 1125, as amended, in relation to Section 2402 of the Tariff and Customs Code within 30 days
after the receipt of the order. Without the appeal having been timely filed in the CTA, the February 4,
2002 Consolidated Order became final and executory.
Chevron Philippines Inc. vs. Commissioner of Internal Revenue
G.R. No. 210836, September 1, 2015
BERSAMIN, J.:
Excise tax on petroleum products is essentially a tax on property, the direct liability for which pertains to
the statutory taxpayer (i.e., manufacturer, producer or importer). Any excise tax paid by the statutory
taxpayer on petroleum products sold to any of the entities or agencies named in Section 135 of the
National Internal Revenue Code (NIRC) exempt from excise tax is deemed illegal or erroneous, and
should be credited or refunded to the payor pursuant to Section 204 of the NIRC. This is because the
exemption granted under Section 135 of the NIRC must be construed in favor of the property itself, that
is, the petroleum products.

FACTS:
Chevron sold and delivered petroleum products to CDC in the period from August 2007 to December
2007. Chevron did not pass on to CDC the excise taxes paid on the importation of the petroleum products
sold to CDC in taxable year 2007; hence, on June 26, 2009, it filed an administrative claim for tax refund
or issuance of tax credit certificate in the amount of P6,542,400.00. Considering that respondent
Commissioner of Internal Revenue (CIR) did not act on the administrative claim for tax refund or tax
credit, Chevron elevated its claim to the CTA by petition for review on June 29, 2009. The case,
docketed as CTA Case No. 7939, was raffled to the CTAs First Division. The CTA First Division
denied Chevrons judicial claim for tax refund or tax credit.

ISSUE: whether Chevron was entitled to the tax refund or the tax credit for the excise taxes paid on the
importation of petroleum products that it had sold to CDC in 2007
RULING:
Under Section 12917 of the NIRC, as amended, excise taxes are imposed on two kinds of goods, namely:
(a) goods manufactured or produced in the Philippines for domestic sales or consumption or for any other
disposition; and (b) things imported. Undoubtedly, the excise tax imposed under Section 129 of the NIRC
is a tax on property. With respect to imported things, Section 131 of the NIRC declares that excise taxes
on imported things shall be paid by the owner or importer to the Customs officers, conformably with the
regulations of the Department of Finance and before the release of such articles from the customs house,
unless the imported things are exempt from excise taxes and the person found to be in possession of the
same is other than those legally entitled to such tax exemption. For this purpose, the statutory taxpayer is
the importer of the things subject to excise tax.
Chevron, being the statutory taxpayer, paid the excise taxes on its importation of the petroleum products.
Pursuant to Section 135(c), supra, petroleum products sold to entities that are by law exempt from direct
and indirect taxes are exempt from excise tax. The phrase which are by law exempt from direct and
indirect taxes describes the entities to whom the petroleum products must be sold in order to render the
exemption operative. Section 135(c) should thus be construed as an exemption in favor of the petroleum
products on which the excise tax was levied in the first place. The exemption cannot be granted to the
buyers that is, the entities that are by law exempt from direct and indirect taxes because they are not
under any legal duty to pay the excise tax. Inasmuch as its liability for the payment of the excise taxes
accrued immediately upon importation and prior to the removal of the petroleum products from the
customshouse, Chevron was bound to pay, and actually paid such taxes. But the status of the petroleum
products as exempt from the excise taxes would be confirmed only upon their sale to CDC in 2007 (or,
for that matter, to any of the other entities or agencies listed in Section 135 of the NIRC). Before then,
Chevron did not have any legal basis to claim the tax refund or the tax credit as to the petroleum products.
Payment of the excise taxes by Chevron upon its importation of petroleum products was deemed illegal
and erroneous upon the sale of the petroleum products to CDC

Tridharma Marketing Corporation vs. Court of Tax Appeals

G.R. No. 215950, June 20, 2016
BERSAMIN, J.:
CTA may order the suspension of the collection of taxes provided that the taxpayer either: (1) deposits the
amount claimed; or (2) files a surety bond for not more than double the amount.

FACTS:
Petitioner received a Preliminary Assessment Notice (PAN) from the Bureau of Internal Revenue (BIR)
assessing it with various deficiency taxes -income tax (IT), value-added tax (VAT), withholding tax on
compensation (WTC), expanded withholding tax (EWT) and documentary stamp tax (DST) -totalling
P4,640,394,039.97, inclusive surcharge and interest. A substantial portion of the deficiency income tax
and VAT arose from the complete disallowance by the BIR of the petitioner's purchases from Etheria
Trading in 2010 amounting to P4,942,937,053.82. The petitioner replied to the PAN. Petitioner received
from the BIR a Formal Letter of Demand assessing it with deficiency taxes for the taxable year ending
December 31, 2010 amounting to P4,697,696,275.25, inclusive of surcharge and interest. It filed a protest
against the formal letter of demand. Respondent Commissioner of Internal Revenue (CIR) required the
petitioner to submit additional documents in support of its protest, and the petitioner complied. Petitioner
received a Final Decision on Disputed Assessment worth P4,473,228,667.87. petitioner filed with the CIR
a protest through a Request for Reconsideration. However, the CIR rendered a decision denying the
request for reconsideration.

ISSUE: Did the CTA in Division commit grave abuse of discretion in requiring the petitioner to file a
surety bond despite the supposedly patent illegality of the assessment that was beyond the petitioner's net
worth but equivalent to the deficiency assessment for IT and VAT?

RULING:
CTA may order the suspension of the collection of taxes provided that the taxpayer either: (1) deposits the
amount claimed; or (2) files a surety bond for not more than double the amount. The surety bond
amounting to P4,467,391,881.76 imposed by the CTA was within the parameters delineated in Section 11
of R.A. 1125, as amended. The Court holds, however, that the CTA in Division gravely abused its
discretion under Section 11 because it fixed the amount of the bond at nearly five times the net worth of
the petitioner without conducting a preliminary hearing to ascertain whether there were grounds to
suspend the collection of the deficiency assessment on the ground that such collection would jeopardize
the interests of the taxpayer. Although the amount of P4,467,391,881.76 was itself the amount of the
assessment, it behoved the CTA in Division to consider other factors recognized by the law itself towards
suspending the collection of the assessment, like whether or not the assessment would jeopardize the
interest of the taxpayer, or whether the means adopted by the CIR in determining the liability of the
taxpayer was legal and valid. Simply prescribing such high amount of the bond like the initial 150% of
the deficiency assessment of P4,467,391,881.76 (or P6,701,087,822.64), or later on even reducing the
amount of the bond to equal the deficiency assessment would practically deny to the petitioner the
meaningful opportunity to contest the validity of the assessments, and would likely even impoverish it as
to force it out of business. Section 11 of R.A. 1125, as amended, indicates that the requirement of the
bond as a condition precedent to suspension of the collection applies only in cases where the processes by
which the collection sought to be made by means thereof are carried out in consonance with the law, not
when the processes are in plain violation of the law that they have to be suspended for jeopardizing the
interests of the taxpayer. The Court is not in the position to rule on the correctness of the deficiency
assessment, which is a matter still pending in the CTA. Conformably with the pronouncement in Pacquiao
v. Court of Tax Appeals, First Division, and the Commissioner of Internal Revenue, a ruling that has
precedential value herein, the Court deems it best to remand the matter involving the petitioner's plea
against the correctness of the deficiency assessment to the CTA for the conduct of a preliminary hearing
in order to determine whether the required surety bond should be dispensed with or reduced.

Coral Bay Nickel Corporation vs. Commissioner of Internal Revenue

G.R. No. 190506, June 13, 2016
BERSAMIN, J.:
Section 8 of Republic Act No. 7916 mandates that PEZA shall manage and operate the ECOZONE as a
separate customs territory. The provision thereby establishes the fiction that an ECOZONE is a foreign
territory separate and distinct from the customs territory.

FACTS:
The petitioner, a domestic corporation engaged in the manufacture of nickel and/or cobalt mixed sulphide,
is a VAT entity registered with the Bureau of Internal Revenue (BIR). It is also registered with the
Philippine Economic Zone Authority (PEZA) as an Ecozone Export Enterprise at the Rio Tuba Export
Processing Zone under PEZA Certificate of Registration. Petitioner filed its Amended VAT Return
declaring unutilized input tax from its domestic purchases of capital goods, other than capital goods and
services, for its third and fourth quarters of 2002 totalling P50,124,086.75. On June 14, 2004, it filed with
Revenue District Office No. 36 in Palawan its Application for Tax Credits/Refund (BIR Form 1914)
together with supporting documents. Due to the alleged inaction of the respondent, the petitioner elevated
its claim to the CTA on July 8, 2004 by petition for review, praying for the refund of the aforesaid input
VAT.

ISSUE: Was the petitioner, an entity located within an ECOZONE, entitled to the refund of its unutilized
input taxes incurred before it became a PEZA-registered entity?

RULING:
With the issuance of RMC 74-99, the distinction under the old rule was disregarded and the new circular
took into consideration the two important principles of the Philippine VAT system: the Cross Border
Doctrine and the Destination Principle. Section 8 of Republic Act No. 7916 mandates that PEZA shall
manage and operate the ECOZONE as a separate customs territory. The provision thereby establishes the
fiction that an ECOZONE is a foreign territory separate and distinct from the customs territory.
Accordingly, the sales made by suppliers from a customs territory to a purchaser located within an
ECOZONE will be considered as exportations. Following the Philippine VAT system's adherence to the
Cross Border Doctrine and Destination Principle, the VAT implications are that "no VAT shall be
imposed to form part of the cost of goods destined for consumption outside of the territorial border of the
taxing authority".
The petitioner's principal office was located in Barangay Rio Tuba, Bataraza, Palawan. Its plant site was
specifically located inside the Rio Tuba Export Processing Zone -a special economic zone (ECOZONE)
created by Proclamation No. 304, Series of 2002, in relation to Republic Act No. 7916. As such, the
purchases of goods and services by the petitioner that were destined for consumption within the
ECOZONE should be free of VAT; hence, no input VAT should then be paid on such purchases,
rendering the petitioner not entitled to claim a tax refund or credit. Verily, if the petitioner had paid the
input VAT, the CTA was correct in holding that the petitioner's proper recourse was not against the
Government but against the seller who had shifted to it the output VAT following RMC No. 42-03