ARTICLE 15 For resolution is the effect of the foreign divorce on the parties and their alleged

conjugal property in the Philippines.

[ G.R. No. 68470, October 08, 1985 ]
Petitioner contends that respondent is estopped from laying claim on the alleged
ALICE REYES VAN DORN, PETITIONER, VS. HON. MANUEL conjugal property because of the representation he made in the divorce proceedings
V. ROMILLO, JR., AS PRESIDING JUDGE OF BRANCH CX, REGIONAL before the American Court that they had no community of property; that the Galleon
TRIAL COURT OF THE NATIONAL CAPITAL REGION PASAY CITY, Shop was not established through conjugal funds; and that respondent's claim is
AND RICHARD UPTON, RESPONDENTS. barred by prior judgment.

The basic background facts are that petitioner is a citizen of the Philippines while For his part, respondent avers that the Divorce Decree issued by the Nevada Court
private respondent is a citizen of the United States; that they were married in cannot prevail over the prohibitive laws of the Philippines and its declared national
Hongkong in 1972; that, after the marriage, they established their residence in the policy; that the acts and declaration of a foreign Court cannot, especially if the same
Philippines; that they begot two children born on April 4, 1973 and December 18, is contrary to public policy, divest Philippine Courts of jurisdiction to entertain
1975, respectively; that the parties were divorced in Nevada, United States, in 1982; matters within its jurisdiction.
and that petitioner has re-married also in Nevada, this time to Theodore Van Dorn.
For the resolution of this case, it is not necessary to determine whether the property
Dated June 8, 1983, private respondent filed suit against petitioner in Civil Case No. relations between petitioner and private respondent, after their marriage, were upon
1075-P of the Regional Trial Court, Branch CXV, in Pasay City, stating that absolute or relative community property, upon complete separation of property, or
petitioner's business in Ermita, Manila, (the Galleon Shop, for short), is conjugal upon any other regime.  The pivotal fact in this case is the Nevada divorce of the
property of the parties, and asking that petitioner be ordered to render an accounting parties.
of that business, and that private respondent be declared with right to manage the
conjugal property.  Petitioner moved to dismiss the case on the ground that the cause The Nevada District Court, which decreed the divorce, had obtained jurisdiction over
of action is barred by previous judgment in the divorce proceedings before the petitioner who appeared in person before the Court during the trial of the case.  It also
Nevada Court wherein respondent had acknowledged that he and petitioner had "no obtained jurisdiction over private respondent who, giving his address as No. 381 Bush
community property" as of June 11, 1982.  The Court below denied the Motion to Street, San Francisco, California, authorized his attorneys in the divorce case, Karp &
Dismiss in the mentioned case on the ground that the property involved is located in Gradt, Ltd., to agree to the divorce on the ground of incompatibility in the
the Philippines so that the Divorce Decree has no bearing in the case.  The denial is understanding that there were neither community property nor community
now the subject of this Certiorari proceeding. obligations.[3] As explicitly stated in the Power of Attorney he executed in favor of the
law firm of KARP & GRAD LTD., 336 W. Liberty, Reno, Nevada, to represent him
Generally, the denial of a Motion to Dismiss in a civil case is interlocutory and is not in the divorce proceedings:
subject to appeal.  Certiorari and Prohibition are neither the remedies to question the
propriety of an interlocutory order of the trial Court.  However, when a, grave abuse "You are hereby authorized to accept service of Summons, to file an Answer, appear
of discretion was patently committed, or the lower Court acted capriciously and on my behalf and do all things necessary and proper to represent me, without further
whimsically, then it devolves upon this Court in a certiorari proceeding to exercise contesting, subject to the following:
its supervisory authority and to correct the error committed which, in such a case, is "1.  That my spouse seeks a divorce on the ground of incompatibility.
equivalent to lack of jurisdiction.[1] Prohibition would then lie since it would be
useless and a waste of time to go ahead with the proceedings.[2] We consider the "2.  That there is no community of property to be adjudicated by the Court.
petition filed in this case within the exception, and we have given it due course.
 rights to conjugal property.  She should not be discriminated against in her own
"3.  That there are no community obligations to be adjudicated by the court. country if the ends of justice are to be served.
x x x                               x x x                               x x x"[4]
WHEREFORE, the Petition is granted, and respondent Judge is hereby ordered to
There can be no question as to the validity of that Nevada divorce in any of the States dismiss the Complaint filed in Civil Case No. 1075-P of his Court.
of the United States.  The decree is binding on private respondent as an American
citizen.  For instance, private respondent cannot sue petitioner, as her husband, in any Without costs.
State of the Union.  What he is contending in this case is that the divorce is not valid
and binding in this jurisdiction, the same being contrary to local law and public SO ORDERED.
policy.

It is true that owing to the nationality principle embodied in Article 15 of the Civil
Code[5], only Philippine nationals are covered by the policy against absolute divorces [ G.R. No. 80116, June 30, 1989 ]
the same being considered contrary to our concept of public policy and morality. 
However, aliens may obtain divorces abroad, which may be recognized in the IMELDA MANALAYSAY PILAPIL, PETITIONER, VS. HON. CORONA
Philippines, provided they are valid according to their national law.[6] In this case, the IBAY-SOMERA, IN HER CAPACITY AS PRESIDING JUDGE OF THE
divorce in Nevada released private respondent from the marriage from the standards REGIONAL TRIAL COURT OF MANILA, BRANCH XXVI; HON. LUIS C.
of American law, under which divorce dissolves the marriage.  As stated by the VICTOR, IN HIS CAPACITY AS THE CITY FISCAL OF MANILA; AND
Federal Supreme Court of the United States in Atherton  vs. Atherton, 45 L. Ed. 794, ERICH EKKEHARD GEILING, RESPONDENTS.
799:
"The purpose and effect of a decree of divorce from the bond of matrimony by a court An ill-starred marriage of a Filipina and a foreigner which ended in a foreign absolute
of competent jurisdiction are to change the existing status or domestic relation of divorce, only to be followed by a criminal infidelity suit of the latter against the
husband and wife, and to free them both from the bond.  The marriage tie, when thus former, provides Us the opportunity to lay down a decisional rule on what hitherto
severed as to one party, ceases to bind either.  A husband without a wife, or a wife appears to be an unresolved jurisdictional question.
without a husband, is unknown to the law.  When the law provides, in the nature of a
penalty, that the guilty party shall not marry again, that party, as well as the other, is On September 7, 1979, petitioner Imelda Manalaysay Pilapil, a Filipino citizen, and
still absolutely freed from the bond of the former marriage." private respondent Erich Ekkchard Geiling, a German national, were married before
Thus, pursuant to his national law, private respondent is no longer the husband of the Registrar of Births, Marriages and Deaths at Friedcnsweilcr in the Federal
petitioner.  He would have no standing to sue in the case below as petitioner's Republic of Germany. The marriage started auspiciously enough, and the couple lived
husband entitled to exercise control over conjugal assets.  As he is bound by the together for some time in Malate, Manila where their only child, Isabella Pilapil
Decision of his own country's Court, which validly exercised jurisdiction over him, Geiling, was born on April 20, 1980.
and whose decision he does not repudiate, he is estopped by his own representation
before said Court from asserting his right over the alleged conjugal property. Thereafter, marital discord set in, with mutual recriminations between the spouses,
followed by a separation de facto between them.
To maintain, as private respondent does, that, under our laws, petitioner has to be
considered still married to private respondent and still subject to a wife's obligations After about three and a half years of marriage, such connubial disharmony eventuated
under Article 109, et. seq. of the Civil Code cannot be just.  Petitioner should not be in private respondent initiating a divorce proceeding against petitioner in Germany
obliged to live together with, observe respect and fidelity, and render support to before the Schoneberg Local Court in January, 1983. He claimed that there was
private respondent.  The latter should not continue to be one of her heirs with possible failure of their marriage and that they had been living apart since April, 1982.
Petitioner, on the other hand, filed an action for legal separation, support and respondent judge merely reset the date of the arraignment in Criminal Case No. 87-
separation of property before the Regional Trial Court of Manila, Branch XXXII, on 52435 to April 6, 1987. Before such scheduled date, petitioner moved for the
January 23, 1983 where the same is still pending as Civil Case No. 83-15866. cancellation of the arraignment and for the suspension of proceedings in said
Criminal Case No. 87-52435 until after the resolution of the petition for review then
On January 15, 1986, Division 20 of the Schoneberg Local Court, Federal Republic pending before the Secretary of Justice. A motion to quash was also filed in the same
of Germany, promulgated a decree of divorce on the ground of failure of marriage of case on the ground of lack of jurisdiction, which motion was denied by the
the spouses. The custody of the child was granted to petitioner. The records show that respondent judge in an order dated September 8, 1987. The same order also directed
under German law said court was locally and internationally competent for the the arraignment of both accused therein, that is, petitioner and William Chia. The
divorce proceeding and that the dissolution of said marriage was legally founded on latter entered a plea of not guilty while the petitioner refused to be arraigned. Such
and authorized by the applicable law of that foreign jurisdiction. refusal of the petitioner being considered by respondent judge as direct contempt, she
and her counsel were fined and the former was ordered detained until she submitted
On June 27, 1986, or more than five months after the issuance of the divorce decree, herself for arraignment. Later, private respondent entered a plea of not guilty.
private respondent filed two complaints for adultery before the City Fiscal of Manila
alleging that, while still married to said respondent, petitioner "had an affair with a On October 27, 1987, petitioner filed this special civil action for certiorari and
certain William Chia as early as 1982 and with yet another man named Jesus Chua prohibition, with a prayer for a temporary restraining order, seeking the annulment of
sometime in 1983." Assistant Fiscal Jacinto A. de los Reyes, Jr., after the the order of the lower court denying her motion to quash. The petition is anchored on
corresponding investigation, recommended the dismissal of the cases on the ground the main ground that the court is without jurisdiction "to try and decide the charge of
of insufficiency of evidence. However, upon review, the respondent city fiscal adultery, which is a private offense that cannot be prosecuted de officio (sic), since
approved a resolution, dated January 8, 1986, directing the filing of two complaints the purported complainant, a foreigner, does not qualify as an offended spouse having
for adultery against the petitioner. The complaints were accordingly filed and were obtained a final divorce decree under his national law prior to his filing the criminal
eventually raffled to two branches of the Regional Trial Court of Manila. The case complaint."
entitled "People of the Philippines vs. Imelda Pilapil and William Chia" docketed as
Criminal Case No. 87-52435, was assigned to Branch XXVI presided by the On October 21,1987, this Court issued a temporary restraining order enjoining the
respondent judge; while the other case "People of the Philippines vs. Imelda Pilapil respondents from implementing the aforesaid order of September 8, 1987 and from
and James Chua" docketed as Criminal Case No. 87-52434 went to the sala of Judge further proceeding with Criminal Case No. 87-52435. Subsequently, on March 23,
Leonardo Cruz, Branch XXV, of the same court. 1988 Secretary of Justice Sedfrey A. Ordoñez acted on the aforesaid petitions for
review and, upholding petitioner's ratiocinations, issued a resolution directing the
On March 14,1987, petitioner filed a petition with the Secretary of Justice asking that respondent city fiscal to move for the dismissal of the complaints against the
the aforesaid resolution of respondent fiscal be set aside and the cases against her be petitioner.
dismissed. A similar petition was filed by James Chua, her co-accused in Criminal
Case No. 87-52434. The Secretary of Justice, through the Chief State Prosecutor, We find this petition meritorious. The writs prayed for shall accordingly issue.
gave due course to both petitions and directed the respondent city fiscal to inform the
Department of Justice "if the accused have already been arraigned and if not yet Under Article 344 of the Revised Penal Code, the crime of adultery, as well as four
arraigned, to move to defer further proceedings" and to elevate the entire records of other crimes against chastity, cannot be prosecuted except upon a sworn written
both cases to his office for review. complaint filed by the offended spouse. It has long since been established, with
unwavering consistency, that compliance with this rule is a jurisdictional, and not
Petitioner thereafter filed a motion in both criminal cases to defer her arraignment and merely a formal, requirement. While in point of strict law the jurisdiction of the court
to suspend further proceedings thereon. As a consequence, Judge Leonardo Cruz over the offense is vested in it by the Judiciary Law, the requirement for a sworn
suspended proceedings in Criminal Case No. 87-52434. On the other hand, written complaint is just as jurisdictional a mandate since it is that complaint which
starts the prosecutory proceeding and without which the court cannot exercise its the raison d'etre of said provision of law would be absent where the supposed
jurisdiction to try the case. offended party had ceased to be the spouse of the alleged offender at the time of the
filing of the criminal case.
Now, the law specifically provides that in prosecutions for adultery and concubinage
the person who can legally file the complaint should be the offended spouse, and In these cases, therefore, it is indispensable that the status and capacity of the
nobody else. Unlike the offenses of seduction, abduction, rape and acts of complainant to commence the action be definitely established and, as already
lasciviousness, no provision is made for the prosecution of the crimes of adultery and demonstrated, such status or capacity must indubitably exist as of the time he initiates
concubinage by the parents, grandparents or guardian of the offended party. The so- the action. It would be absurd if his capacity to bring the action would be determined
called exclusive and successive rule in the prosecution of the first four offenses by his status before or subsequent to the commencement thereof, where such capacity
abovementioned do not apply to adultery and concubinage. It is significant that while or status existed prior to but ceased before, or was acquired subsequent to but did not
the State, as parens partriae, was added and vested by the 1985 Rules of Criminal exist at the time of, the institution of the case. We would thereby have the anomalous
Procedure with the power to initiate the criminal action for a deceased or spectacle of a party bringing suit at the very time when he is without the legal
incapacitated victim in the aforesaid offenses of seduction, abduction, rape and acts of capacity to do so.
lasciviousness, in default of her parents, grandparents or guardian, such amendment
did not include the crimes of adultery and concubinage. In other words, only the To repeat, there does not appear to be any local precedential jurisprudence on the
offended spouse, and no other, is authorized by law to initiate the action therefor. specific issue as to when precisely the status of a complainant as an offended spouse
must exist where a criminal prosecution can be commenced only by one who in law
Corollary to such exclusive grant of power to the offended spouse to institute the can be categorized as possessed of such status. Stated differently and with reference
action, it necessarily follows that such initiator must have the status, capacity or legal to the present case, the inquiry would be whether it is necessary in the
representation to do so at the time of the filing of the criminal action. This is a commencement of a criminal action for adultery that the marital bonds between the
familiar and express rule in civil actions; in fact, lack of legal capacity to sue, as a complainant and the accused be unsevered and existing at the time of the institution
ground for a motion to dismiss in civil cases, is determined as of the filing of the of the action by the former against the latter.
complaint or petition.
American jurisprudence, on cases involving statutes in that jurisdiction which are in
The absence of an equivalent explicit rule in the prosecution criminal cases does not pari materia with ours, yields the rule that after a divorce has been decreed, the
mean that the same requirement and rationale would not apply. Understandably, it innocent spouse no longer has the right to institute proceedings against the
may not have been found necessary since criminal actions are generally and offenders where the statute provides that the innocent spouse shall have the exclusive
fundamentally commenced by the State, through the People of the Philippines, the right to institute a prosecution for adultery. Where, however, proceedings have been
offended party being merely the complaining witness therein. However, in the so- properly commenced, a divorce subsequently granted can have no legal effect on the
called "private crimes," or those which cannot be prosecuted de oficio, and the present prosecution of the criminal proceedings to a conclusion.
prosecution for adultery is of such genre, the offended spouse assumes a more
predominant role since the right to commence the action, or to refrain there from, is a In the cited Loftus case, the Supreme Court of Iowa held that —
matter exclusively within his power and option.
'"No prosecution for adultery can be commenced except on the complaint of the
This policy was adopted out of consideration for the aggrieved party who might husband or wife.' Section 4932, Code. Though Loftus was husband of defendant when
prefer to suffer the outrage in silence rather than go through the scandal of a public the offense is said to have been committed, he had ceased to be such when the
trial. Hence, as cogently argued by petitioner, Article 344 of the Revised Penal Code prosecution was begun; and appellant insists that his status was not such as to entitle
thus presupposes that the marital relationship is still subsisting at the time of the him to make the complaint. We have repeatedly said that the offense is against the
institution of the criminal action for adultery. This is a logical consequence since unoffending spouse, as well as the state, in explaining the reason for this provision in
the statute; and we are of the opinion that the unoffending spouse must be such when Under the same considerations and rationale, private respondent, being no longer the
the prosecution is commenced." (Italics supplied.) husband of petitioner, had no legal standing to commence the adultery case under the
imposture that he was the offended spouse at the time he filed suit.
We see no reason why the same doctrinal rule should not apply in this case and in our
jurisdiction, considering our statutory law and jural policy on the matter. We are The allegation of private respondent that he could not have brought this case before
convinced that in cases of such nature, the status of the complainant vis-a-vis the the decree of divorce for lack of knowledge, even if true, is of no legal significance or
accused must be determined as of the time the complaint was filed. Thus, the person consequence in this case. When said respondent initiated the divorce proceeding, he
who initiates the adultery case must be an offended spouse, and by this is meant that obviously knew that there would no longer be a family nor marriage vows to protect
he is still married to the accused spouse, at the time of the filing of the complaint. once a dissolution of the marriage is decreed. Neither would there be a danger of
introducing spurious heirs into the family, which is said to be one of the reasons for
In the present case, the fact that private respondent obtained a valid divorce in his the particular formulation of our law on adultery, since there would thenceforth be no
country, the Federal Republic of Germany, is admitted. Said divorce and its legal spousal relationship to speak of. The severance of the marital bond had the effect of
effects may be recognized in the Philippines insofar as private respondent is dissociating the former spouses from each other, hence the actuations of one would
concerned in view of the nationality principle in our civil law on the matter of status not affect or cast obloquy on the other.
of persons.
The aforecited case of United States  vs. Mata cannot be successfully relied upon by
Thus, in the recent case of Van Dorn vs.  Romillo, Jr., et al., after a divorce was private respondent. In applying Article 433 of the old Penal Code, substantially the
granted by a United States court between Alice Van Dorn, a Filipina, and her same as Article 333 of the Revised Penal Code, which punished adultery "although
American husband, the latter filed a civil case in a trial court here alleging that her the marriage be afterwards declared void," the Court merely stated that "the
business concern was conjugal property and praying that she be ordered to render an lawmakers intended to declare adulterous the infidelity of a married woman to her
accounting and that the plaintiff be granted the right to manage the business. marital vows, even though it should be made to appear that she is entitled to have her
Rejecting his pretensions, this Court perspicuously demonstrated the error of such marriage contract declared null and void, until and unless she actually secures a
stance, thus: formal judicial declaration to that effect." Definitely, it cannot be logically inferred
therefrom that the complaint can still be filed after the declaration of nullity because
"There can be no question as to the validity of that Nevada divorce in any of the such declaration that the marriage is void ab initio is equivalent to stating that it never
States of the United States. The decree is binding on private respondent as an existed. There being no marriage from the beginning, any complaint for adultery filed
American citizen. For instance, private respondent cannot sue petitioner, as her after said declaration of nullity would no longer have a leg to stand on. Moreover,
husband, in any State of the Union, xxx. what was consequently contemplated and within the purview of the decision in said
case is the situation where the criminal action for adultery was filed before the
"It is true that owing to the nationality principle embodied in Article 15 of the Civil termination of the marriage by a judicial declaration of its nullity ab initio. The same
Code, only Philippine nationals are covered by the policy against absolute divorces rule and requisite would necessarily apply where the termination of the marriage was
the same being considered contrary to our concept of public policy and morality. effected, as in this case, by a valid foreign divorce.
However, aliens may obtain divorces abroad, which may be recognized in the
Philippines, provided they are valid xxx according to their national law. xxx Private respondent's invocation of Donio-Teves, et al.  vs. Vamenta, hereinbefore
cited, must suffer the same fate of inapplicability. A cursory reading of said case
"Thus, pursuant to his national law, private respondent is no longer the husband of reveals that the offended spouse therein had duly and seasonably filed a complaint for
petitioner. He would have no standing to sue in the case below as petitioner's husband adultery, although an issue was raised as to its sufficiency but which was resolved in
entitled to exercise control over conjugal assets, x x x" favor of the complainant. Said case did not involve a factual situation akin to the one
at bar or any issue determinative of the controversy herein.
WHEREFORE, the questioned order denying petitioner's motion to quash is SET The Facts
ASIDE and another one entered DISMISSING the complaint in Criminal Case No. 87-
52435 for lack of jurisdiction. The temporary restraining order issued in this case on Rederick A. Recio, a Filipino, was married to Editha Samson, an Australian citizen,
October 21, 1987 is hereby made permanent. in Malabon, Rizal, on March 1, 1987. They lived together as husband and wife in
Australia. On May 18, 1989, a decree of divorce, purportedly dissolving the marriage,
SO ORDERED. was issued by an Australian family court.

G.R. No. 138322           October 2, 2001 On June 26, 1992, respondent became an Australian citizen, as shown by a
"Certificate of Australian Citizenship" issued by the Australian government.
Petitioner – a Filipina – and respondent were married on January 12, 1994 in Our
GRACE J. GARCIA, a.k.a. GRACE J. GARCIA- Lady of Perpetual Help Church in Cabanatuan City. In their application for a
RECIO, petitioner, marriage license, respondent was declared as "single" and "Filipino."
vs.
Starting October 22, 1995, petitioner and respondent lived separately without prior
REDERICK A. RECIO, respondents. judicial dissolution of their marriage. While the two were still in Australia, their
conjugal assets were divided on May 16, 1996, in accordance with their Statutory
PANGANIBAN, J.: Declarations secured in Australia.

A divorce obtained abroad by an alien may be recognized in our jurisdiction, On March 3, 1998, petitioner filed a Complaint for Declaration of Nullity of
provided such decree is valid according to the national law of the foreigner. However, Marriage in the court a quo, on the ground of bigamy – respondent allegedly had a
the divorce decree and the governing personal law of the alien spouse who obtained prior subsisting marriage at the time he married her on January 12, 1994. She claimed
the divorce must be proven. Our courts do not take judicial notice of foreign laws and that she learned of respondent's marriage to Editha Samson only in November, 1997.
judgment; hence, like any other facts, both the divorce decree and the national law of
the alien must be alleged and proven according to our law on evidence. In his Answer, respondent averred that, as far back as 1993, he had revealed to
petitioner his prior marriage and its subsequent dissolution. He contended that his
The Case first marriage to an Australian citizen had been validly dissolved by a divorce decree
obtained in Australian in 1989; thus, he was legally capacitated to marry petitioner in
Before us is a Petition for Review under Rule 45 of the Rules of Court, seeking to 1994.
nullify the January 7, 1999 Decision 1 and the March 24, 1999 Order 2 of the Regional
Trial Court of Cabanatuan City, Branch 28, in Civil Case No. 3026-AF. The assailed On July 7, 1998 – or about five years after the couple's wedding and while the suit for
Decision disposed as follows: the declaration of nullity was pending – respondent was able to secure a divorce
decree from a family court in Sydney, Australia because the "marriage ha[d]
"WHEREFORE, this Court declares the marriage between Grace J. Garcia irretrievably broken down."
and Rederick A. Recio solemnized on January 12, 1994 at Cabanatuan City as
dissolved and both parties can now remarry under existing and applicable Respondent prayed in his Answer that the Complained be dismissed on the ground
laws to any and/or both parties."3 that it stated no cause of action. The Office of the Solicitor General agreed with
respondent. The court marked and admitted the documentary evidence of both
The assailed Order denied reconsideration of the above-quoted Decision. parties. After they submitted their respective memoranda, the case was submitted for
resolution.
Thereafter, the trial court rendered the assailed Decision and Order. The trial court patently and grievously erred in disregarding Arts. 11, 13, 21,
35, 40, 52 and 53 of the Family Code as the applicable provisions in this case.
Ruling of the Trial Court
"5
The trial court declared the marriage dissolved on the ground that the divorce issued
in Australia was valid and recognized in the Philippines. It deemed the marriage The trial court gravely erred in pronouncing that the divorce gravely erred in
ended, but not on the basis of any defect in an essential element of the marriage; that pronouncing that the divorce decree obtained by the respondent in
is, respondent's alleged lack of legal capacity to remarry. Rather, it based its Australia ipso facto capacitated the parties to remarry, without first securing a
Decision on the divorce decree obtained by respondent. The Australian divorce had recognition of the judgment granting the divorce decree before our courts."
ended the marriage; thus, there was no more martial union to nullify or annual.
The Petition raises five issues, but for purposes of this Decision, we shall concentrate
Hence, this Petition. on two pivotal ones: (1) whether the divorce between respondent and Editha Samson
was proven, and (2) whether respondent was proven to be legally capacitated to marry
Issues petitioner. Because of our ruling on these two, there is no more necessity to take up
the rest.
Petitioner submits the following issues for our consideration:
The Court's Ruling
"I
The Petition is partly meritorious.
The trial court gravely erred in finding that the divorce decree obtained in
Australia by the respondent ipso facto terminated his first marriage to Editha First Issue:
Samson thereby capacitating him to contract a second marriage with the
petitioner. Proving the Divorce Between Respondent and Editha Samson

"2 Petitioner assails the trial court's recognition of the divorce between respondent and
Editha Samson. Citing Adong v. Cheong Seng Gee, petitioner argues that the divorce
The failure of the respondent, who is now a naturalized Australian, to present decree, like any other foreign judgment, may be given recognition in this jurisdiction
a certificate of legal capacity to marry constitutes absence of a substantial only upon proof of the existence of (1) the foreign law allowing absolute divorce and
requisite voiding the petitioner' marriage to the respondent. (2) the alleged divorce decree itself. She adds that respondent miserably failed to
establish these elements.
"3
Petitioner adds that, based on the first paragraph of Article 26 of the Family Code,
The trial court seriously erred in the application of Art. 26 of the Family Code marriages solemnized abroad are governed by the law of the place where they were
in this case. celebrated (the lex loci celebrationist). In effect, the Code requires the presentation of
the foreign law to show the conformity of the marriage in question to the legal
"4 requirements of the place where the marriage was performed.
At the outset, we lay the following basic legal principles as the take-off points for our of the deceased spouse or the judicial decree of annulment or declaration of
discussion. Philippine law does not provide for absolute divorce; hence, our courts nullity of his or her previous marriage. x x x.
cannot grant it. A marriage between two Filipinos cannot be dissolved even by a
divorce obtained abroad, because of Articles 15 and 17 of the Civil Code. In mixed "ART. 52. The judgment of annulment or of absolute nullity of the marriage,
marriages involving a Filipino and a foreigner, Article 26 of the Family Code allows the partition and distribution of the properties of the spouses, and the delivery
the former to contract a subsequent marriage in case the divorce is "validly obtained of the children's presumptive legitimes shall be recorded in the appropriate
abroad by the alien spouse capacitating him or her to remarry." A divorce obtained civil registry and registries of property; otherwise, the same shall not affect
abroad by a couple, who are both aliens, may be recognized in the Philippines, their persons."
provided it is consistent with their respective national laws.
Respondent, on the other hand, argues that the Australian divorce decree is a public
A comparison between marriage and divorce, as far as pleading and proof are document – a written official act of an Australian family court. Therefore, it requires
concerned, can be made. Van Dorn v. Romillo Jr. decrees that "aliens may obtain no further proof of its authenticity and due execution.
divorces abroad, which may be recognized in the Philippines, provided they are valid
according to their national law." Therefore, before a foreign divorce decree can be Respondent is getting ahead of himself. Before a foreign judgment is given
recognized by our courts, the party pleading it must prove the divorce as a fact and presumptive evidentiary value, the document must first be presented and admitted in
demonstrate its conformity to the foreign law allowing it. Presentation solely of the evidence. A divorce obtained abroad is proven by the divorce decree itself. Indeed the
divorce decree is insufficient. best evidence of a judgment is the judgment itself. The decree purports to be a written
act or record of an act of an officially body or tribunal of a foreign country.
Divorce as a Question of Fact
Under Sections 24 and 25 of Rule 132, on the other hand, a writing or document may
Petitioner insists that before a divorce decree can be admitted in evidence, it must be proven as a public or official record of a foreign country by either (1) an official
first comply with the registration requirements under Articles 11, 13 and 52 of the publication or (2) a copy thereof attested by the officer having legal custody of the
Family Code. These articles read as follows: document. If the record is not kept in the Philippines, such copy must be (a)
accompanied by a certificate issued by the proper diplomatic or consular officer in the
"ART. 11. Where a marriage license is required, each of the contracting Philippine foreign service stationed in the foreign country in which the record is kept
parties shall file separately a sworn application for such license with the and (b) authenticated by the seal of his office.
proper local civil registrar which shall specify the following:
The divorce decree between respondent and Editha Samson appears to be an authentic
x x x     x x x     x x x one issued by an Australian family court. However, appearance is not sufficient;
compliance with the aforementioned rules on evidence must be demonstrated.
"(5) If previously married, how, when and where the previous marriage was
dissolved or annulled; Fortunately for respondent's cause, when the divorce decree of May 18, 1989 was
submitted in evidence, counsel for petitioner objected, not to its admissibility, but
x x x      x x x      x x x only to the fact that it had not been registered in the Local Civil Registry of
Cabanatuan City. The trial court ruled that it was admissible, subject to petitioner's
"ART. 13. In case either of the contracting parties has been previously qualification. Hence, it was admitted in evidence and accorded weight by the judge.
married, the applicant shall be required to furnish, instead of the birth of Indeed, petitioner's failure to object properly rendered the divorce decree admissible
baptismal certificate required in the last preceding article, the death certificate as a written act of the Family Court of Sydney, Australia.
Compliance with the quoted articles (11, 13 and 52) of the Family Code is not Petitioner contends that, in view of the insufficient proof of the divorce, respondent
necessary; respondent was no longer bound by Philippine personal laws after he was legally incapacitated to marry her in 1994.
acquired Australian citizenship in 1992. Naturalization is the legal act of adopting an
alien and clothing him with the political and civil rights belonging to a Hence, she concludes that their marriage was void ab initio.
citizen. Naturalized citizens, freed from the protective cloak of their former states,
don the attires of their adoptive countries. By becoming an Australian, respondent Respondent replies that the Australian divorce decree, which was validly admitted in
severed his allegiance to the Philippines and the vinculum juris that had tied him to evidence, adequately established his legal capacity to marry under Australian law.
Philippine personal laws.
Respondent's contention is untenable. In its strict legal sense, divorce means the legal
Burden of Proving Australian Law dissolution of a lawful union for a cause arising after marriage. But divorces are of
different types. The two basic ones are (1) absolute divorce or a vinculo
Respondent contends that the burden to prove Australian divorce law falls upon matrimonii and (2) limited divorce or a mensa et thoro. The first kind terminates the
petitioner, because she is the party challenging the validity of a foreign judgment. He marriage, while the second suspends it and leaves the bond in full force. There is no
contends that petitioner was satisfied with the original of the divorce decree and was showing in the case at bar which type of divorce was procured by respondent.
cognizant of the marital laws of Australia, because she had lived and worked in that
country for quite a long time. Besides, the Australian divorce law is allegedly known Respondent presented a decree nisi or an interlocutory decree – a conditional or
by Philippine courts: thus, judges may take judicial notice of foreign laws in the provisional judgment of divorce. It is in effect the same as a separation from bed and
exercise of sound discretion. board, although an absolute divorce may follow after the lapse of the prescribed
period during which no reconciliation is effected.
We are not persuaded. The burden of proof lies with "the party who alleges the
existence of a fact or thing necessary in the prosecution or defense of an action." 41 In Even after the divorce becomes absolute, the court may under some foreign statutes
civil cases, plaintiffs have the burden of proving the material allegations of the and practices, still restrict remarriage. Under some other jurisdictions, remarriage
complaint when those are denied by the answer; and defendants have the burden of may be limited by statute; thus, the guilty party in a divorce which was granted on the
proving the material allegations in their answer when they introduce new ground of adultery may be prohibited from remarrying again. The court may allow a
matters.42 Since the divorce was a defense raised by respondent, the burden of proving remarriage only after proof of good behavior.
the pertinent Australian law validating it falls squarely upon him.
On its face, the herein Australian divorce decree contains a restriction that reads:
It is well-settled in our jurisdiction that our courts cannot take judicial notice of
foreign laws.43 Like any other facts, they must be alleged and proved. Australian "1. A party to a marriage who marries again before this decree becomes
marital laws are not among those matters that judges are supposed to know by reason absolute (unless the other party has died) commits the offence of bigamy."
of their judicial function.44 The power of judicial notice must be exercised with
caution, and every reasonable doubt upon the subject should be resolved in the This quotation bolsters our contention that the divorce obtained by respondent may
negative. have been restricted. It did not absolutely establish his legal capacity to remarry
according to his national law. Hence, we find no basis for the ruling of the trial court,
Second Issue: which erroneously assumed that the Australian divorce ipso facto restored
respondent's capacity to remarry despite the paucity of evidence on this matter.
Respondent's Legal Capacity to Remarry
We also reject the claim of respondent that the divorce decree raises a disputable
presumption or presumptive evidence as to his civil status based on Section 48, Rule
3949 of the Rules of Court, for the simple reason that no proof has been presented on remarry without requiring him to adduce sufficient evidence to show the Australian
the legal effects of the divorce decree obtained under Australian laws. personal law governing his status; or at the very least, to prove his legal capacity to
contract the second marriage.
Significance of the Certificate of Legal Capacity
Neither can we grant petitioner's prayer to declare her marriage to respondent null and
Petitioner argues that the certificate of legal capacity required by Article 21 of the void on the ground of bigamy. After all, it may turn out that under Australian law, he
Family Code was not submitted together with the application for a marriage license. was really capacitated to marry petitioner as a direct result of the divorce decree.
According to her, its absence is proof that respondent did not have legal capacity to Hence, we believe that the most judicious course is to remand this case to the trial
remarry. court to receive evidence, if any, which show petitioner's legal capacity to marry
petitioner. Failing in that, then the court a quo may declare a nullity of the parties'
We clarify. To repeat, the legal capacity to contract marriage is determined by the marriage on the ground of bigamy, there being already in evidence two existing
national law of the party concerned. The certificate mentioned in Article 21 of the marriage certificates, which were both obtained in the Philippines, one in Malabon,
Family Code would have been sufficient to establish the legal capacity of respondent, Metro Manila dated March 1, 1987 and the other, in Cabanatuan City dated January
had he duly presented it in court. A duly authenticated and admitted certificate is 12, 1994.
prima facie evidence of legal capacity to marry on the part of the alien applicant for a
marriage license. WHEREFORE, in the interest of orderly procedure and substantial justice,
we REMAND the case to the court a quo for the purpose of receiving evidence which
As it is, however, there is absolutely no evidence that proves respondent's legal conclusively show respondent's legal capacity to marry petitioner; and failing in that,
capacity to marry petitioner. A review of the records before this Court shows that of declaring the parties' marriage void on the ground of bigamy, as above discussed.
only the following exhibits were presented before the lower court: (1) for petitioner: No costs.
(a) Exhibit "A" – Complaint;51 (b) Exhibit "B" – Certificate of Marriage Between
Rederick A. Recto (Filipino-Australian) and Grace J. Garcia (Filipino) on January 12, SO ORDERED.
1994 in Cabanatuan City, Nueva Ecija;52 (c) Exhibit "C" – Certificate of Marriage
Between Rederick A. Recio (Filipino) and Editha D. Samson (Australian) on March G.R. No. 124862. December 22, 1998
1, 1987 in Malabon, Metro Manila;53 (d) Exhibit "D" – Office of the City Registrar of
Cabanatuan City Certification that no information of annulment between Rederick A. FE D. QUITA, Petitioner, v. COURT OF APPEALS and BLANDINA
Recto and Editha D. Samson was in its records;54 and (e) Exhibit "E" – Certificate of
DANDAN,* Respondents.
Australian Citizenship of Rederick A. Recto;55 (2) for respondent: (Exhibit "1" –
Amended Answer;56 (b) Exhibit "S" – Family Law Act 1975 Decree Nisi of
FE D. QUITA and Arturo T. Padlan, both Filipinos, were married in the Philippines
Dissolution of Marriage in the Family Court of Australia; 57 (c) Exhibit "3" –
on 18 May 1941. They were not however blessed with children. Somewhere along the
Certificate of Australian Citizenship of Rederick A. Recto;58 (d) Exhibit "4" – Decree
way their relationship soured. Eventually Fe sued Arturo for divorce in San
Nisi of Dissolution of Marriage in the Family Court of Australia Certificate; 59 and
Francisco, California, U.S.A. She submitted in the divorce proceedings a private
Exhibit "5" – Statutory Declaration of the Legal Separation Between Rederick A.
writing dated 19 July 1950 evidencing their agreement to live separately from each
Recto and Grace J. Garcia Recio since October 22, 1995.60
other and a settlement of their conjugal properties. On 23 July 1954 she obtained a
final judgment of divorce. Three (3) weeks thereafter she married a certain Felix
Based on the above records, we cannot conclude that respondent, who was then a
Tupaz in the same locality but their relationship also ended in a divorce. Still in the
naturalized Australian citizen, was legally capacitated to marry petitioner on January
U.S.A., she married for the third time, to a certain Wernimont.
12, 1994. We agree with petitioner's contention that the court a quo erred in finding
that the divorce decree ipso facto clothed respondent with the legal capacity to
On 16 April 1972 Arturo died. He left no will. On 31 August 1972 Lino Javier children, except Alexis who was recognized as his illegitimate child, had been made
Inciong filed a petition with the Regional Trial Court of Quezon City for issuance of in their respective records of birth. Thus on 15 February 1988 6 partial reconsideration
letters of administration concerning the estate of Arturo in favor of the Philippine was granted declaring the Padlan children, with the exception of Alexis, entitled to
Trust Company. Respondent Blandina Dandan (also referred to as Blandina Padlan), one-half of the estate to the exclusion of Ruperto Padlan, and petitioner to the other
claiming to be the surviving spouse of Arturo Padlan, and Claro, Alexis, Ricardo, half.7 Private respondent was not declared an heir. Although it was stated in the
Emmanuel, Zenaida and Yolanda, all surnamed Padlan, named in the petition as aforementioned records of birth that she and Arturo were married on 22 April 1947,
surviving children of Arturo Padlan, opposed the petition and prayed for the their marriage was clearly void since it was celebrated during the existence of his
appointment instead of Atty. Leonardo Cabasal, which was resolved in favor of the previous marriage to petitioner.
latter. Upon motion of the oppositors themselves, Atty. Cabasal was later replaced by
Higino Castillon. On 30 April 1973 the oppositors (Blandina and the Padlan children) In their appeal to the Court of Appeals, Blandina and her children assigned as one of
submitted certified photocopies of the 19 July 1950 private writing and the final the errors allegedly committed by the trial court the circumstance that the case was
judgment of divorce between petitioner and Arturo. Later Ruperto T. Padlan, decided without a hearing, in violation of Sec. 1, Rule 90, of the Rules of Court,
claiming to be the sole surviving brother of the deceased Arturo, intervened. which provides that if there is a controversy before the court as to who are the lawful
heirs of the deceased person or as to the distributive shares to which each person is
On 7 October 1987 petitioner moved for the immediate declaration of heirs of the entitled under the law, the controversy shall be heard and decided as in ordinary
decedent and the distribution of his estate. At the scheduled hearing on 23 October cases.
1987, private respondent as well as the six (6) Padlan children and Ruperto failed to
appear despite due notice. On the same day, the trial court required the submission of Respondent appellate court found this ground alone sufficient to sustain the appeal;
the records of birth of the Padlan children within ten (10) days from receipt thereof, hence, on 11 September 1995 it declared null and void the 27 November 1987
after which, with or without the documents, the issue on the declaration of heirs decision and 15 February 1988 order of the trial court, and directed the remand of the
would be considered submitted for resolution. The prescribed period lapsed without case to the trial court for further proceedings.8 On 18 April 1996 it denied
the required documents being submitted. reconsideration.9cräläwvirtualibräry

The trial court invoking Tenchavez v. Escao1 which held that "a foreign divorce Should this case be remanded to the lower court for further proceedings? Petitioner
between Filipino citizens sought and decreed after the effectivity of the present Civil insists that there is no need because, first, no legal or factual issue obtains for
Code (Rep. Act 386) was not entitled to recognition as valid in this resolution either as to the heirship of the Padlan children or as to their respective
jurisdiction,"2 disregarded the divorce between petitioner and Arturo. Consequently, it shares in the intestate estate of the decedent; and, second, the issue as to who between
expressed the view that their marriage subsisted until the death of Arturo in 1972. petitioner and private respondent is the proper heir of the decedent is one of law
Neither did it consider valid their extrajudicial settlement of conjugal properties due which can be resolved in the present petition based on established facts and
to lack of judicial approval.3 On the other hand, it opined that there was no showing admissions of the parties.
that marriage existed between private respondent and Arturo, much less was it shown
that the alleged Padlan children had been acknowledged by the deceased as his We cannot sustain petitioner. The provision relied upon by respondent court is
children with her. As regards Ruperto, it found that he was a brother of Arturo. On 27 clear: If there is a  controversy  before the court as to who are the lawful heirs of the
November 19874 only petitioner and Ruperto were declared the intestate heirs of deceased person  or as to the distributive shares to which each person is entitled
Arturo. Accordingly, equal adjudication of the net hereditary estate was ordered in under the law, the controversy  shall be heard and decided as in ordinary cases.
favor of the two intestate heirs.5cräläwvirtualibräry
We agree with petitioner that no dispute exists either as to the right of the six (6)
On motion for reconsideration, Blandina and the Padlan children were allowed to Padlan children to inherit from the decedent because there are proofs that they have
present proofs that the recognition of the children by the deceased as his legitimate been duly acknowledged by him and petitioner herself even recognizes them as heirs
of Arturo Padlan;10 nor as to their respective hereditary shares. But controversy Respondent again raised in her appeal the issue on petitioner's citizenship; 17 it did not
remains as to who is the legitimate surviving spouse of Arturo. The trial court, after merit enlightenment however from petitioner.18 In the present proceeding, petitioner's
the parties other than petitioner failed to appear during the scheduled hearing on 23 citizenship is brought anew to the fore by private respondent. She even furnishes the
October 1987 of the motion for immediate declaration of heirs and distribution of Court with the transcript of stenographic notes taken on 5 May 1995 during the
estate, simply issued an order requiring the submission of the records of birth of the hearing for the reconstitution of the original of a certain transfer certificate title as
Padlan children within ten (10) days from receipt thereof, after which, with or without well as the issuance of new owner's duplicate copy thereof before another trial court.
the documents, the issue on declaration of heirs would be deemed submitted for When asked whether she was an American citizen petitioner answered that she was
resolution. since 1954.19 Significantly, the decree of divorce of petitioner and Arturo was
obtained in the same year. Petitioner however did not bother to file a reply
We note that in her comment to petitioner's motion private respondent raised, among memorandum to erase the uncertainty about her citizenship at the time of their
others, the issue as to whether petitioner was still entitled to inherit from the decedent divorce, a factual issue requiring hearings to be conducted by the trial court.
considering that she had secured a divorce in the U.S.A. and in fact had twice Consequently, respondent appellate court did not err in ordering the case returned to
remarried. She also invoked the above quoted procedural rule. 11 To this, petitioner the trial court for further proceedings.
replied that Arturo was a Filipino and as such remained legally married to her in spite
of the divorce they obtained.12 Reading between the lines, the implication is that We emphasize however that the question to be determined by the trial court should be
petitioner was no longer a Filipino citizen at the time of her divorce from Arturo. This limited only to the right of petitioner to inherit from Arturo as his surviving spouse.
should have prompted the trial court to conduct a hearing to establish her citizenship. Private respondent's claim to heirship was already resolved by the trial court. She and
The purpose of a hearing is to ascertain the truth of the matters in issue with the aid of Arturo were married on 22 April 1947 while the prior marriage of petitioner and
documentary and testimonial evidence as well as the arguments of the parties either Arturo was subsisting thereby resulting in a bigamous marriage considered void from
supporting or opposing the evidence. Instead, the lower court perfunctorily settled her the beginning under Arts. 80 and 83 of the Civil Code. Consequently, she is not a
claim in her favor by merely applying the ruling in Tenchavez v. Escao. surviving spouse that can inherit from him as this status presupposes a legitimate
relationship.20cräläwvirtualibräry
Then in private respondent's motion to set aside and/or reconsider the lower court's
decision she stressed that the citizenship of petitioner was relevant in the light of the As regards the motion of private respondent for petitioner and her counsel to be
ruling in Van Dorn v. Romillo Jr.13 that aliens may obtain divorces abroad, which declared in contempt of court and that the present petition be dismissed for forum
may be recognized in the Philippines, provided they are valid according to their shopping,21 the same lacks merit. For forum shopping to exist the actions must
national law. She prayed therefore that the case be set for hearing. 14 Petitioner involve the same transactions and same essential facts and circumstances. There must
opposed the motion but failed to squarely address the issue on her citizenship. 15 The also be identical causes of action, subject matter and issue. 22 The present petition
trial court did not grant private respondent's prayer for a hearing but proceeded to deals with declaration of heirship while the subsequent petitions filed before the three
resolve her motion with the finding that both petitioner and Arturo were "Filipino (3) trial courts concern the issuance of new owner's duplicate copies of titles of
citizens and were married in the Philippines."16 It maintained that their divorce certain properties belonging to the estate of Arturo. Obviously, there is no reason to
obtained in 1954 in San Francisco, California, U.S.A., was not valid in Philippine declare the existence of forum shopping.
jurisdiction. We deduce that the finding on their citizenship pertained solely to the
time of their marriage as the trial court was not supplied with a basis to determine WHEREFORE, the petition is DENIED. The decision of respondent Court of
petitioner's citizenship at the time of their divorce. The doubt persisted as to whether Appeals ordering the remand of the case to the court of origin for further proceedings
she was still a Filipino citizen when their divorce was decreed. The trial court must and declaring null and void its decision holding petitioner Fe D. Quita and Ruperto T.
have overlooked the materiality of this aspect. Once proved that she was no longer a Padlan as intestate heirs is AFFIRMED. The order of the appellate court modifying
Filipino citizen at the time of their divorce, Van Dorn would become applicable and its previous decision by granting one-half (1/2) of the net hereditary estate to the
petitioner could very well lose her right to inherit from Arturo. Padlan children, namely, Claro, Ricardo, Emmanuel, Zenaida and Yolanda, with the
exception of Alexis, all surnamed Padlan, instead of Arturo's brother Ruperto Padlan, On July 14, 1984, Tristan married petitioner Elmar O. Perez in the State of Virginia in
is likewise AFFIRMED. The Court however emphasizes that the reception of the United States and both lived as husband and wife until October 2001. Their union
evidence by the trial court should be limited to the hereditary rights of petitioner as produced one offspring.
the surviving spouse of Arturo Padlan.
During their cohabitation, petitioner learned that the divorce decree issued by the
The motion to declare petitioner and her counsel in contempt of court and to dismiss court in the Dominican Republic which "dissolved" the marriage between Tristan and
the present petition for forum shopping is DENIED. Lily was not recognized in the Philippines and that her marriage to Tristan was
deemed void under Philippine law. When she confronted Tristan about this, the latter
SO ORDERED. assured her that he would legalize their union after he obtains an annulment of his
marriage with Lily. Tristan further promised the petitioner that he would adopt their
G.R. No. 162580 January 27, 2006 son so that he would be entitled to an equal share in his estate as that of each of his
children with Lily.9
ELMAR O. PEREZ, Petitioner, On August 13, 2001, Tristan filed a petition for the declaration of nullity of his
vs. marriage to Lily with the Regional Trial Court of Quezon City, docketed as Case No.
COURT OF APPEALS, Fifth Division, TRISTAN A. CATINDIG Q-01-44847.
and LILY GOMEZ-CATINDIG, Respondents.
Subsequently, petitioner filed a Motion for Leave to File Intervention claiming that
Private respondent Tristan A. Catindig married Lily Gomez Catindig twice on May she has a legal interest in the matter in litigation because she knows certain
16, 1968. The first marriage ceremony was celebrated at the Central Methodist information which might aid the trial court at a truthful, fair and just adjudication of
Church at T.M. Kalaw Street, Ermita, Manila while the second took place at the the annulment case, which the trial court granted on September 30, 2002. Petitioner’s
Lourdes Catholic Church in La Loma, Quezon City. The marriage produced four complaint-in-intervention was also ordered admitted.
children.
Tristan filed a petition for certiorari and prohibition with the Court of Appeals
Several years later, the couple encountered marital problems that they decided to seeking to annul the order dated September 30, 2002 of the trial court. The Court of
separate from each other. Upon advice of a mutual friend, they decided to obtain a Appeals granted the petition and declared as null and void the September 30, 2002
divorce from the Dominican Republic. Thus, on April 27, 1984, Tristan and Lily Order of the trial court granting the motion for leave to file intervention and admitting
executed a Special Power of Attorney addressed to the Judge of the First Civil Court the complaint-in-intervention.
of San Cristobal, Dominican Republic, appointing an attorney-in-fact to institute a
divorce action under its laws. Petitioner’s motion for reconsideration was denied, hence this petition for certiorari
and prohibition filed under Rule 65 of the Rules of Court. Petitioner contends that the
Thereafter, on April 30, 1984, the private respondents filed a joint petition for Court of Appeals gravely abused its discretion in disregarding her legal interest in the
dissolution of conjugal partnership with the Regional Trial Court of Makati. On June annulment case between Tristan and Lily.
12, 1984, the civil court in the Dominican Republic ratified the divorce by mutual
consent of Tristan and Lily. Subsequently, on June 23, 1984, the Regional Trial Court The petition lacks merit.
of Makati City, Branch 133, ordered the complete separation of properties between
Tristan and Lily. Ordinarily, the proper recourse of an aggrieved party from a decision of the Court of
Appeals is a petition for review on certiorari under Rule 45 of the Rules of Court.
However, if the error subject of the recourse is one of jurisdiction, or the act
complained of was granted by a court with grave abuse of discretion amounting to may be delayed or prejudiced, or whether the intervenor’s rights may be protected in
lack or excess of jurisdiction, as alleged in this case, the proper remedy is a petition a separate proceeding or not.16
for certiorari under Rule 65 of the said Rules.11 This is based on the premise that in
issuing the assailed decision and resolution, the Court of Appeals acted with grave Legal interest, which entitles a person to intervene, must be in the matter in litigation
abuse of discretion, amounting to excess of lack of jurisdiction and there is no plain, and of such direct and immediate character that the intervenor will either gain or lose
speedy and adequate remedy in the ordinary course of law. A remedy is considered by direct legal operation and effect of the judgment.17 Such interest must be actual,
plain, speedy, and adequate if it will promptly relieve the petitioner from the injurious direct and material, and not simply contingent and expectant.18
effect of the judgment and the acts of the lower court.12
Petitioner claims that her status as the wife and companion of Tristan for 17 years
It is therefore incumbent upon the petitioner to establish that the Court of Appeals vests her with the requisite legal interest required of a would-be intervenor under the
acted with grave abuse of discretion amounting to excess or lack of jurisdiction when Rules of Court.
it promulgated the assailed decision and resolution.
Petitioner’s claim lacks merit. Under the law, petitioner was never the legal wife of
We have previously ruled that grave abuse of discretion may arise when a lower court Tristan, hence her claim of legal interest has no basis.
or tribunal violates or contravenes the Constitution, the law or existing jurisprudence.
By grave abuse of discretion is meant, such capricious and whimsical exercise of When petitioner and Tristan married on July 14, 1984, Tristan was still lawfully
judgment as is equivalent to lack of jurisdiction. The abuse of discretion must be married to Lily. The divorce decree that Tristan and Lily obtained from the
grave as where the power is exercised in an arbitrary or despotic manner by reason of Dominican Republic never dissolved the marriage bond between them. It is basic that
passion or personal hostility and must be so patent and gross as to amount to an laws relating to family rights and duties, or to the status, condition and legal capacity
evasion of positive duty or to a virtual refusal to perform the duty enjoined by or to of persons are binding upon citizens of the Philippines, even though living abroad.
act at all in contemplation of law.13 The word "capricious," usually used in tandem Regardless of where a citizen of the Philippines might be, he or she will be governed
with the term "arbitrary," conveys the notion of willful and unreasoning action. Thus, by Philippine laws with respect to his or her family rights and duties, or to his or her
when seeking the corrective hand of certiorari, a clear showing of caprice and status, condition and legal capacity. Hence, if a Filipino regardless of whether he or
arbitrariness in the exercise of discretion is imperative.14 she was married here or abroad, initiates a petition abroad to obtain an absolute
divorce from spouse and eventually becomes successful in getting an absolute divorce
The Rules of Court laid down the parameters before a person, not a party to a case decree, the Philippines will not recognize such absolute divorce.
can intervene, thus:
When Tristan and Lily married on May 18, 1968, their marriage was governed by the
Who may intervene. — A person who has a legal interest in the matter in litigation, or provisions of the Civil Code which took effect on August 30, 1950. In the case of
in the success of either of the parties, or an interest against both, or is so situated as to Tenchavez v. Escano22 we held:
be adversely affected by a distribution or other disposition of property in the custody
of the court or of an officer thereof may, with leave of court, be allowed to intervene (1) That a foreign divorce between Filipino citizens, sought and decreed after the
in the action. The court shall consider whether or not the intervention will unduly effectivity of the present Civil Code (Rep. Act No. 386), is not entitled to recognition
delay or prejudice the adjudication of the rights of the original parties, and whether or as valid in this jurisdiction; and neither is the marriage contracted with another party
not the intervenor’s rights may be fully protected in a separate proceeding.15 by the divorced consort, subsequently to the foreign decree of divorce, entitled to
validity in the country. (Emphasis added)
The requirements for intervention are: [a] legal interest in the matter in litigation; and
[b] consideration must be given as to whether the adjudication of the original parties
Thus, petitioner’s claim that she is the wife of Tristan even if their marriage was Sulit on March 17, 1942 out of which were born six children, namely: Rodolfo, Mila,
celebrated abroad lacks merit. Thus, petitioner never acquired the legal interest as a Edgar, Linda, Emilita and Manuel. On August 11, 1963, Virginia predeceased
wife upon which her motion for intervention is based. Felicisimo.

Since petitioner’s motion for leave to file intervention was bereft of the indispensable Five years later, on May 1, 1968, Felicisimo married Merry Lee Corwin, with whom
requirement of legal interest, the issuance by the trial court of the order granting the he had a son, Tobias. However, on October 15, 1971, Merry Lee, an American
same and admitting the complaint-in-intervention was attended with grave abuse of citizen, filed a Complaint for Divorce 5 before the Family Court of the First Circuit,
discretion. Consequently, the Court of Appeals correctly set aside and declared as null State of Hawaii, United States of America (U.S.A.), which issued a Decree Granting
and void the said order. Absolute Divorce and Awarding Child Custody on December 14, 1973. 6

WHEREFORE, the petition is DISMISSED. The assailed Decision dated July 25, On June 20, 1974, Felicisimo married respondent Felicidad San Luis, then surnamed
2003 and Resolution dated January 23, 2004 of the Court of Appeals in CA-G.R. SP Sagalongos, before Rev. Fr. William Meyer, Minister of the United Presbyterian at
No. 74456 are AFFIRMED. Wilshire Boulevard, Los Angeles, California, U.S.A. 7 He had no children with
respondent but lived with her for 18 years from the time of their marriage up to his
No pronouncement as to costs. death on December 18, 1992.

SO ORDERED. Thereafter, respondent sought the dissolution of their conjugal partnership assets and
the settlement of Felicisimo’s estate. On December 17, 1993, she filed a petition for
G.R. No. 133743 February 6, 2007 letters of administration 8 before the Regional Trial Court of Makati City, docketed as
SP. Proc. No. M-3708 which was raffled to Branch 146 thereof.
EDGAR SAN LUIS, Petitioner,
Respondent alleged that she is the widow of Felicisimo; that, at the time of his death,
vs. the decedent was residing at 100 San Juanico Street, New Alabang Village, Alabang,
FELICIDAD SAN LUIS, Respondent. Metro Manila; that the decedent’s surviving heirs are respondent as legal spouse, his
six children by his first marriage, and son by his second marriage; that the decedent
x ---------------------------------------------------- x left real properties, both conjugal and exclusive, valued at ₱30,304,178.00 more or
less; that the decedent does not have any unpaid debts. Respondent prayed that the
conjugal partnership assets be liquidated and that letters of administration be issued to
G.R. No. 134029 February 6, 2007
her.

RODOLFO SAN LUIS, Petitioner, On February 4, 1994, petitioner Rodolfo San Luis, one of the children of Felicisimo
vs. by his first marriage, filed a motion to dismiss 9 on the grounds of improper venue
FELICIDAD SAGALONGOS alias FELICIDAD SAN LUIS, and failure to state a cause of action. Rodolfo claimed that the petition for letters of
Respondent. administration should have been filed in the Province of Laguna because this was
Felicisimo’s place of residence prior to his death. He further claimed that respondent
The instant case involves the settlement of the estate of Felicisimo T. San Luis has no legal personality to file the petition because she was only a mistress of
(Felicisimo), who was the former governor of the Province of Laguna. During his Felicisimo since the latter, at the time of his death, was still legally married to Merry
lifetime, Felicisimo contracted three marriages. His first marriage was with Virginia Lee.
On February 15, 1994, Linda invoked the same grounds and joined her brother
Rodolfo in seeking the dismissal 10 of the petition. On February 28, 1994, the trial On April 24, 1995, 22 the trial court required the parties to submit their respective
court issued an Order 11 denying the two motions to dismiss. position papers on the twin issues of venue and legal capacity of respondent to file the
petition. On May 5, 1995, Edgar manifested 23 that he is adopting the arguments and
Unaware of the denial of the motions to dismiss, respondent filed on March 5, 1994 evidence set forth in his previous motion for reconsideration as his position paper.
her opposition 12 thereto. She submitted documentary evidence showing that while Respondent and Rodolfo filed their position papers on June 14, 24 and June 20, 25
Felicisimo exercised the powers of his public office in Laguna, he regularly went 1995, respectively.
home to their house in New Alabang Village, Alabang, Metro Manila which they
bought sometime in 1982. Further, she presented the decree of absolute divorce On September 12, 1995, the trial court dismissed the petition for letters of
issued by the Family Court of the First Circuit, State of Hawaii to prove that the administration. It held that, at the time of his death, Felicisimo was the duly elected
marriage of Felicisimo to Merry Lee had already been dissolved. Thus, she claimed governor and a resident of the Province of Laguna. Hence, the petition should have
that Felicisimo had the legal capacity to marry her by virtue of paragraph 2, 13 been filed in Sta. Cruz, Laguna and not in Makati City. It also ruled that respondent
Article 26 of the Family Code and the doctrine laid down in Van Dorn v. Romillo, Jr. was without legal capacity to file the petition for letters of administration because her
14 marriage with Felicisimo was bigamous, thus, void ab initio. It found that the decree
of absolute divorce dissolving Felicisimo’s marriage to Merry Lee was not valid in
Thereafter, Linda, Rodolfo and herein petitioner Edgar San Luis, separately filed the Philippines and did not bind Felicisimo who was a Filipino citizen. It also ruled
motions for reconsideration from the Order denying their motions to dismiss. 15 They that paragraph 2, Article 26 of the Family Code cannot be retroactively applied
asserted that paragraph 2, Article 26 of the Family Code cannot be given retroactive because it would impair the vested rights of Felicisimo’s legitimate children.
effect to validate respondent’s bigamous marriage with Felicisimo because this would
impair vested rights in derogation of Article 256 16 of the Family Code. Respondent moved for reconsideration 26 and for the disqualification 27 of Judge
Arcangel but said motions were denied. 28
On April 21, 1994, Mila, another daughter of Felicisimo from his first marriage, filed
a motion to disqualify Acting Presiding Judge Anthony E. Santos from hearing the Respondent appealed to the Court of Appeals which reversed and set aside the orders
case. of the trial court in its assailed Decision dated February 4, 1998, the dispositive
portion of which states:
On October 24, 1994, the trial court issued an Order 17 denying the motions for
reconsideration. It ruled that respondent, as widow of the decedent, possessed the WHEREFORE, the Orders dated September 12, 1995 and January 31, 1996 are
legal standing to file the petition and that venue was properly laid. Meanwhile, the hereby REVERSED and SET ASIDE; the Orders dated February 28 and October 24,
motion for disqualification was deemed moot and academic 18 because then Acting 1994 are REINSTATED; and the records of the case is REMANDED to the trial
Presiding Judge Santos was substituted by Judge Salvador S. Tensuan pending the court for further proceedings. 29
resolution of said motion.
The appellante court ruled that under Section 1, Rule 73 of the Rules of Court, the
Mila filed a motion for inhibition 19 against Judge Tensuan on November 16, 1994. term "place of residence" of the decedent, for purposes of fixing the venue of the
On even date, Edgar also filed a motion for reconsideration 20 from the Order settlement of his estate, refers to the personal, actual or physical habitation, or actual
denying their motion for reconsideration arguing that it does not state the facts and residence or place of abode of a person as distinguished from legal residence or
law on which it was based. domicile. It noted that although Felicisimo discharged his functions as governor in
Laguna, he actually resided in Alabang, Muntinlupa. Thus, the petition for letters of
On November 25, 1994, Judge Tensuan issued an Order 21 granting the motion for administration was properly filed in Makati City.
inhibition. The case was re-raffled to Branch 134 presided by Judge Paul T. Arcangel.
The Court of Appeals also held that Felicisimo had legal capacity to marry domicile, the petition for letters of administration should have been filed in Sta. Cruz,
respondent by virtue of paragraph 2, Article 26 of the Family Code and the rulings in Laguna.
Van Dorn v. Romillo, Jr. 30 and Pilapil v. Ibay-Somera. 31 It found that the marriage
between Felicisimo and Merry Lee was validly dissolved by virtue of the decree of Petitioners also contend that respondent’s marriage to Felicisimo was void and
absolute divorce issued by the Family Court of the First Circuit, State of Hawaii. As a bigamous because it was performed during the subsistence of the latter’s marriage to
result, under paragraph 2, Article 26, Felicisimo was capacitated to contract a Merry Lee. They argue that paragraph 2, Article 26 cannot be retroactively applied
subsequent marriage with respondent. Thus – because it would impair vested rights and ratify the void bigamous marriage. As such,
respondent cannot be considered the surviving wife of Felicisimo; hence, she has no
With the well-known rule – express mandate of paragraph 2, Article 26, of the Family legal capacity to file the petition for letters of administration.
Code of the Philippines, the doctrines in Van Dorn, Pilapil, and the reason and
philosophy behind the enactment of E.O. No. 227, — there is no justiciable reason to The issues for resolution: (1) whether venue was properly laid, and (2) whether
sustain the individual view — sweeping statement — of Judge Arc[h]angel, that respondent has legal capacity to file the subject petition for letters of administration.
"Article 26, par. 2 of the Family Code, contravenes the basic policy of our state
against divorce in any form whatsoever." Indeed, courts cannot deny what the law The petition lacks merit.
grants. All that the courts should do is to give force and effect to the express mandate
of the law. The foreign divorce having been obtained by the Foreigner on December Under Section 1, 39 Rule 73 of the Rules of Court, the petition for letters of
14, 1992, 32 the Filipino divorcee, "shall x x x have capacity to remarry under administration of the estate of Felicisimo should be filed in the Regional Trial Court
Philippine laws". For this reason, the marriage between the deceased and petitioner of the province "in which he resides at the time of his death." In the case of Garcia
should not be denominated as "a bigamous marriage. Fule v. Court of Appeals, 40 we laid down the doctrinal rule for determining the
residence – as contradistinguished from domicile – of the decedent for purposes of
Therefore, under Article 130 of the Family Code, the petitioner as the surviving fixing the venue of the settlement of his estate:
spouse can institute the judicial proceeding for the settlement of the estate of the
deceased. x x x 33 [T]he term "resides" connotes ex vi termini "actual residence" as distinguished from
"legal residence or domicile." This term "resides," like the terms "residing" and
Edgar, Linda, and Rodolfo filed separate motions for reconsideration 34 which were "residence," is elastic and should be interpreted in the light of the object or purpose of
denied by the Court of Appeals. the statute or rule in which it is employed. In the application of venue statutes and
rules – Section 1, Rule 73 of the Revised Rules of Court is of such nature – residence
On July 2, 1998, Edgar appealed to this Court via the instant petition for review on rather than domicile is the significant factor. Even where the statute uses the word
certiorari. 35 Rodolfo later filed a manifestation and motion to adopt the said petition "domicile" still it is construed as meaning residence and not domicile in the technical
which was granted. 36 sense. Some cases make a distinction between the terms "residence" and "domicile"
but as generally used in statutes fixing venue, the terms are synonymous, and convey
In the instant consolidated petitions, Edgar and Rodolfo insist that the venue of the the same meaning as the term "inhabitant." In other words, "resides" should be
subject petition for letters of administration was improperly laid because at the time viewed or understood in its popular sense, meaning, the personal, actual or physical
of his death, Felicisimo was a resident of Sta. Cruz, Laguna. They contend that habitation of a person, actual residence or place of abode. It signifies physical
pursuant to our rulings in Nuval v. Guray 37 and Romualdez v. RTC, Br. 7, Tacloban presence in a place and actual stay thereat. In this popular sense, the term means
City, 38 "residence" is synonymous with "domicile" which denotes a fixed permanent merely residence, that is, personal residence, not legal residence or domicile.
residence to which when absent, one intends to return. They claim that a person can Residence simply requires bodily presence as an inhabitant in a given place, while
only have one domicile at any given time. Since Felicisimo never changed his domicile requires bodily presence in that place and also an intention to make it one’s
domicile. No particular length of time of residence is required though; however, the
residence must be more than temporary. 41 (Emphasis supplied) Anent the issue of respondent Felicidad’s legal personality to file the petition for
letters of administration, we must first resolve the issue of whether a Filipino who is
It is incorrect for petitioners to argue that "residence," for purposes of fixing the divorced by his alien spouse abroad may validly remarry under the Civil Code,
venue of the settlement of the estate of Felicisimo, is synonymous with "domicile." considering that Felicidad’s marriage to Felicisimo was solemnized on June 20, 1974,
The rulings in Nuval and Romualdez are inapplicable to the instant case because they or before the Family Code took effect on August 3, 1988. In resolving this issue, we
involve election cases. Needless to say, there is a distinction between "residence" for need not retroactively apply the provisions of the Family Code, particularly Art. 26,
purposes of election laws and "residence" for purposes of fixing the venue of actions. par. (2) considering that there is sufficient jurisprudential basis allowing us to rule in
In election cases, "residence" and "domicile" are treated as synonymous terms, that is, the affirmative.
the fixed permanent residence to which when absent, one has the intention of
returning. 42 However, for purposes of fixing venue under the Rules of Court, the The case of Van Dorn v. Romillo, Jr. 52 involved a marriage between a foreigner and
"residence" of a person is his personal, actual or physical habitation, or actual his Filipino wife, which marriage was subsequently dissolved through a divorce
residence or place of abode, which may not necessarily be his legal residence or obtained abroad by the latter. Claiming that the divorce was not valid under
domicile provided he resides therein with continuity and consistency. 43 Hence, it is Philippine law, the alien spouse alleged that his interest in the properties from their
possible that a person may have his residence in one place and domicile in another. conjugal partnership should be protected. The Court, however, recognized the validity
of the divorce and held that the alien spouse had no interest in the properties acquired
In the instant case, while petitioners established that Felicisimo was domiciled in Sta. by the Filipino wife after the divorce. Thus:
Cruz, Laguna, respondent proved that he also maintained a residence in Alabang,
Muntinlupa from 1982 up to the time of his death. Respondent submitted in evidence In this case, the divorce in Nevada released private respondent from the marriage
the Deed of Absolute Sale 44 dated January 5, 1983 showing that the deceased from the standards of American law, under which divorce dissolves the marriage. As
purchased the aforesaid property. She also presented billing statements 45 from the stated by the Federal Supreme Court of the United States in Atherton vs. Atherton, 45
Philippine Heart Center and Chinese General Hospital for the period August to L. Ed. 794, 799:
December 1992 indicating the address of Felicisimo at "100 San Juanico, Ayala
Alabang, Muntinlupa." Respondent also presented proof of membership of the "The purpose and effect of a decree of divorce from the bond of matrimony by a
deceased in the Ayala Alabang Village Association 46 and Ayala Country Club, Inc., competent jurisdiction are to change the existing status or domestic relation of
47 letter-envelopes 48 from 1988 to 1990 sent by the deceased’s children to him at husband and wife, and to free them both from the bond. The marriage tie, when thus
his Alabang address, and the deceased’s calling cards 49 stating that his home/city severed as to one party, ceases to bind either. A husband without a wife, or a wife
address is at "100 San Juanico, Ayala Alabang Village, Muntinlupa" while his without a husband, is unknown to the law. When the law provides, in the nature of a
office/provincial address is in "Provincial Capitol, Sta. Cruz, Laguna." penalty, that the guilty party shall not marry again, that party, as well as the other, is
still absolutely freed from the bond of the former marriage."
From the foregoing, we find that Felicisimo was a resident of Alabang, Muntinlupa
for purposes of fixing the venue of the settlement of his estate. Consequently, the Thus, pursuant to his national law, private respondent is no longer the husband of
subject petition for letters of administration was validly filed in the Regional Trial petitioner. He would have no standing to sue in the case below as petitioner’s
Court 50 which has territorial jurisdiction over Alabang, Muntinlupa. The subject husband entitled to exercise control over conjugal assets. As he is bound by the
petition was filed on December 17, 1993. At that time, Muntinlupa was still a Decision of his own country’s Court, which validly exercised jurisdiction over him,
municipality and the branches of the Regional Trial Court of the National Capital and whose decision he does not repudiate, he is estopped by his own representation
Judicial Region which had territorial jurisdiction over Muntinlupa were then seated in before said Court from asserting his right over the alleged conjugal property. 53
Makati City as per Supreme Court Administrative Order No. 3. 51 Thus, the subject
petition was validly filed before the Regional Trial Court of Makati City.
As to the effect of the divorce on the Filipino wife, the Court ruled that she should no
longer be considered married to the alien spouse. Further, she should not be required On July 6, 1987, then President Corazon Aquino signed into law Executive Order No.
to perform her marital duties and obligations. It held: 209, otherwise known as the "Family Code," which took effect on August 3, 1988.
Article 26 thereof states:
To maintain, as private respondent does, that, under our laws, petitioner has to be
considered still married to private respondent and still subject to a wife's obligations All marriages solemnized outside the Philippines in accordance with the laws in force
under Article 109, et. seq. of the Civil Code cannot be just. Petitioner should not be in the country where they were solemnized, and valid there as such, shall also be
obliged to live together with, observe respect and fidelity, and render support to valid in this country, except those prohibited under Articles 35, 37, and 38.
private respondent. The latter should not continue to be one of her heirs with possible
rights to conjugal property. She should not be discriminated against in her own On July 17, 1987, shortly after the signing of the original Family Code, Executive
country if the ends of justice are to be served. 54 (Emphasis added) Order No. 227 was likewise signed into law, amending Articles 26, 36, and 39 of the
Family Code. A second paragraph was added to Article 26. As so amended, it now
This principle was thereafter applied in Pilapil v. Ibay-Somera 55 where the Court provides:
recognized the validity of a divorce obtained abroad. In the said case, it was held that
the alien spouse is not a proper party in filing the adultery suit against his Filipino ART. 26. All marriages solemnized outside the Philippines in accordance with the
wife. The Court stated that "the severance of the marital bond had the effect of laws in force in the country where they were solemnized, and valid there as such,
dissociating the former spouses from each other, hence the actuations of one would shall also be valid in this country, except those prohibited under Articles 35(1), (4),
not affect or cast obloquy on the other." 56 (5) and (6), 36, 37 and 38.

Likewise, in Quita v. Court of Appeals, 57 the Court stated that where a Filipino is Where a marriage between a Filipino citizen and a foreigner is validly celebrated and
divorced by his naturalized foreign spouse, the ruling in Van Dorn applies. 58 a divorce is thereafter validly obtained abroad by the alien spouse capacitating him or
Although decided on December 22, 1998, the divorce in the said case was obtained in her to remarry, the Filipino spouse shall have capacity to remarry under Philippine
1954 when the Civil Code provisions were still in effect. law. (Emphasis supplied)

The significance of the Van Dorn case to the development of limited recognition of xxxx
divorce in the Philippines cannot be denied. The ruling has long been interpreted as Legislative Intent
severing marital ties between parties in a mixed marriage and capacitating the
Filipino spouse to remarry as a necessary consequence of upholding the validity of a Records of the proceedings of the Family Code deliberations showed that the intent of
divorce obtained abroad by the alien spouse. In his treatise, Dr. Arturo M. Tolentino Paragraph 2 of Article 26, according to Judge Alicia Sempio-Diy, a member of the
cited Van Dorn stating that "if the foreigner obtains a valid foreign divorce, the Civil Code Revision Committee, is to avoid the absurd situation where the Filipino
Filipino spouse shall have capacity to remarry under Philippine law." 59 In Garcia v. spouse remains married to the alien spouse who, after obtaining a divorce, is no
Recio, 60 the Court likewise cited the aforementioned case in relation to Article 26. longer married to the Filipino spouse.
61
Interestingly, Paragraph 2 of Article 26 traces its origin to the 1985 case of Van Dorn
In the recent case of Republic v. Orbecido III, the historical background and v. Romillo, Jr. The Van Dorn case involved a marriage between a Filipino citizen and
legislative intent behind paragraph 2, Article 26 of the Family Code were discussed, a foreigner. The Court held therein that a divorce decree validly obtained by the alien
to wit: spouse is valid in the Philippines, and consequently, the Filipino spouse is capacitated
to remarry under Philippine law. 63 (Emphasis added)
Brief Historical Background
As such, the Van Dorn case is sufficient basis in resolving a situation where a divorce so we are warned, by Justice Holmes again, "where these words import a policy that
is validly obtained abroad by the alien spouse. With the enactment of the Family goes beyond them."
Code and paragraph 2, Article 26 thereof, our lawmakers codified the law already
established through judicial precedent.1awphi1.net xxxx

Indeed, when the object of a marriage is defeated by rendering its continuance More than twenty centuries ago, Justinian defined justice "as the constant and
intolerable to one of the parties and productive of no possible good to the community, perpetual wish to render every one his due." That wish continues to motivate this
relief in some way should be obtainable. 64 Marriage, being a mutual and shared Court when it assesses the facts and the law in every case brought to it for decision.
commitment between two parties, cannot possibly be productive of any good to the Justice is always an essential ingredient of its decisions. Thus when the facts
society where one is considered released from the marital bond while the other warrants, we interpret the law in a way that will render justice, presuming that it was
remains bound to it. Such is the state of affairs where the alien spouse obtains a valid the intention of the lawmaker, to begin with, that the law be dispensed with justice. 69
divorce abroad against the Filipino spouse, as in this case.
Applying the above doctrine in the instant case, the divorce decree allegedly obtained
Petitioners cite Articles 15 65 and 17 66 of the Civil Code in stating that the divorce by Merry Lee which absolutely allowed Felicisimo to remarry, would have vested
is void under Philippine law insofar as Filipinos are concerned. However, in light of Felicidad with the legal personality to file the present petition as Felicisimo’s
this Court’s rulings in the cases discussed above, the Filipino spouse should not be surviving spouse. However, the records show that there is insufficient evidence to
discriminated against in his own country if the ends of justice are to be served. 67 In prove the validity of the divorce obtained by Merry Lee as well as the marriage of
Alonzo v. Intermediate Appellate Court, 68 the Court stated: respondent and Felicisimo under the laws of the U.S.A. In Garcia v. Recio, the Court
laid down the specific guidelines for pleading and proving foreign law and divorce
But as has also been aptly observed, we test a law by its results; and likewise, we may judgments. It held that presentation solely of the divorce decree is insufficient and
add, by its purposes. It is a cardinal rule that, in seeking the meaning of the law, the that proof of its authenticity and due execution must be presented. Under Sections 24
first concern of the judge should be to discover in its provisions the intent of the and 25 of Rule 132, a writing or document may be proven as a public or official
lawmaker. Unquestionably, the law should never be interpreted in such a way as to record of a foreign country by either (1) an official publication or (2) a copy thereof
cause injustice as this is never within the legislative intent. An indispensable part of attested by the officer having legal custody of the document. If the record is not kept
that intent, in fact, for we presume the good motives of the legislature, is to render in the Philippines, such copy must be (a) accompanied by a certificate issued by the
justice. proper diplomatic or consular officer in the Philippine foreign service stationed in the
foreign country in which the record is kept and (b) authenticated by the seal of his
Thus, we interpret and apply the law not independently of but in consonance with office. 71
justice. Law and justice are inseparable, and we must keep them so. To be sure, there
are some laws that, while generally valid, may seem arbitrary when applied in a With regard to respondent’s marriage to Felicisimo allegedly solemnized in
particular case because of its peculiar circumstances. In such a situation, we are not California, U.S.A., she submitted photocopies of the Marriage Certificate and the
bound, because only of our nature and functions, to apply them just the same, in annotated text of the Family Law Act of California which purportedly show that their
slavish obedience to their language. What we do instead is find a balance between the marriage was done in accordance with the said law. As stated in Garcia, however, the
word and the will, that justice may be done even as the law is obeyed. Court cannot take judicial notice of foreign laws as they must be alleged and proved.

As judges, we are not automatons. We do not and must not unfeelingly apply the law Therefore, this case should be remanded to the trial court for further reception of
as it is worded, yielding like robots to the literal command without regard to its cause evidence on the divorce decree obtained by Merry Lee and the marriage of
and consequence. "Courts are apt to err by sticking too closely to the words of a law," respondent and Felicisimo.
Even assuming that Felicisimo was not capacitated to marry respondent in 1974, the acquisition of property occurred before the Family Code took effect, Article 148
nevertheless, we find that the latter has the legal personality to file the subject petition governs. The Court described the property regime under this provision as follows:
for letters of administration, as she may be considered the co-owner of Felicisimo as
regards the properties that were acquired through their joint efforts during their The regime of limited co-ownership of property governing the union of parties who
cohabitation. are not legally capacitated to marry each other, but who nonetheless live together as
husband and wife, applies to properties acquired during said cohabitation in
Section 6, 74 Rule 78 of the Rules of Court states that letters of administration may proportion to their respective contributions. Co-ownership will only be up to the
be granted to the surviving spouse of the decedent. However, Section 2, Rule 79 extent of the proven actual contribution of money, property or industry. Absent proof
thereof also provides in part: of the extent thereof, their contributions and corresponding shares shall be presumed
to be equal.
SEC. 2. Contents of petition for letters of administration. – A petition for letters of
administration must be filed by an interested person and must show, as far as known In the cases of Agapay v. Palang, and Tumlos v. Fernandez, which involved the issue
to the petitioner: x x x. of co-ownership of properties acquired by the parties to a bigamous marriage and an
adulterous relationship, respectively, we ruled that proof of actual contribution in the
An "interested person" has been defined as one who would be benefited by the estate, acquisition of the property is essential. x x x
such as an heir, or one who has a claim against the estate, such as a creditor. The
interest must be material and direct, and not merely indirect or contingent. As in other civil cases, the burden of proof rests upon the party who, as determined by
the pleadings or the nature of the case, asserts an affirmative issue. Contentions must
In the instant case, respondent would qualify as an interested person who has a direct be proved by competent evidence and reliance must be had on the strength of the
interest in the estate of Felicisimo by virtue of their cohabitation, the existence of party’s own evidence and not upon the weakness of the opponent’s defense.
which was not denied by petitioners. If she proves the validity of the divorce and
Felicisimo’s capacity to remarry, but fails to prove that her marriage with him was In view of the foregoing, we find that respondent’s legal capacity to file the subject
validly performed under the laws of the U.S.A., then she may be considered as a co- petition for letters of administration may arise from her status as the surviving wife of
owner under Article 144 76 of the Civil Code. This provision governs the property Felicisimo or as his co-owner under Article 144 of the Civil Code or Article 148 of
relations between parties who live together as husband and wife without the benefit of the Family Code.
marriage, or their marriage is void from the beginning. It provides that the property
acquired by either or both of them through their work or industry or their wages and WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals
salaries shall be governed by the rules on co-ownership. In a co-ownership, it is not reinstating and affirming the February 28, 1994 Order of the Regional Trial Court
necessary that the property be acquired through their joint labor, efforts and industry. which denied petitioners’ motion to dismiss and its October 24, 1994 Order which
Any property acquired during the union is prima facie presumed to have been dismissed petitioners’ motion for reconsideration is AFFIRMED. Let this case be
obtained through their joint efforts. Hence, the portions belonging to the co-owners REMANDED to the trial court for further proceedings.
shall be presumed equal, unless the contrary is proven. 77
SO ORDERED.
Meanwhile, if respondent fails to prove the validity of both the divorce and the
marriage, the applicable provision would be Article 148 of the Family Code which G.R. No. 171914 July 23, 2014
has filled the hiatus in Article 144 of the Civil Code by expressly regulating the
property relations of couples living together as husband and wife but are incapacitated
SOLEDAD L. LAVADIA, Petitioner,
to marry. 78 In Saguid v. Court of Appeals, we held that even if the cohabitation or
vs.
HEIRS OF JUAN LUCES LUNA, represented by GREGORIO Z. On January 12, 1976, ATTY. LUNA obtained a divorce decree of his marriage with
LUNA and EUGENIA ZABALLERO-LUNA, Respondents. EUGENIA from the Civil and Commercial Chamber of the First Circumscription of
the Court of First Instance of Sto. Domingo, Dominican Republic. Also in Sto.
Divorce between Filipinos is void and ineffectual under the nationality rule adopted Domingo, Dominican Republic, on the same date, ATTY. LUNA contracted another
by Philippine law. Hence, any settlement of property between the parties of the first marriage, this time with SOLEDAD. Thereafter, ATTY. LUNA and SOLEDAD
marriage involving Filipinos submitted as an incident of a divorce obtained in a returned to the Philippines and lived together as husband and wife until 1987.
foreign country lacks competent judicial approval, and cannot be enforceable against
the assets of the husband who contracts a subsequent marriage. Sometime in 1977, ATTY. LUNA organized a new law firm named: Luna,
Puruganan, Sison and Ongkiko (LUPSICON) where ATTY. LUNA was the
The Case managing partner.

The petitioner, the second wife of the late Atty. Juan Luces Luna, appeals the adverse On February 14, 1978, LUPSICON through ATTY. LUNA purchased from Tandang
decision promulgated on November 11, 2005,1 whereby the Court of Appeals (CA) Sora Development Corporation the 6th Floor of Kalaw-Ledesma Condominium
affirmed with modification the decision rendered on August 27, 2001 by the Regional Project (condominium unit) at Gamboa St., Makati City, consisting of 517.52 square
Trial Court (RTC), Branch 138, in Makati City.2 The CA thereby denied her right in meters, for ₱1,449,056.00, to be paid on installment basis for 36 months starting on
the 25/100 pro indiviso share of the husband in a condominium unit, and in the law April 15, 1978. Said condominium unit was to be used as law office of LUPSICON.
books of the husband acquired during the second marriage. After full payment, the Deed of Absolute Sale over the condominium unit was
executed on July 15, 1983, and CCT No. 4779 was issued on August 10, 1983, which
Antecedents was registered bearing the following names:

The antecedent facts were summarized by the CA as follows: "JUAN LUCES LUNA, married to Soledad L. Luna (46/100); MARIO E.
ONGKIKO, married to Sonia P.G. Ongkiko (25/100); GREGORIO R.
ATTY. LUNA, a practicing lawyer, was at first a name partner in the prestigious law PURUGANAN, married to Paz A. Puruganan (17/100); and TERESITA CRUZ
firm Sycip, Salazar, Luna, Manalo, Hernandez & Feliciano Law Offices at that time SISON, married to Antonio J.M. Sison (12/100) x x x" Subsequently, 8/100 share of
when he was living with his first wife, herein intervenor-appellant Eugenia Zaballero- ATTY. LUNA and 17/100 share of Atty. Gregorio R. Puruganan in the condominium
Luna (EUGENIA), whom he initially married in a civil ceremony conducted by the unit was sold to Atty. Mario E. Ongkiko, for which a new CCT No. 21761 was issued
Justice of the Peace of Parañaque, Rizal on September 10, 1947 and later solemnized on February 7, 1992 in the following names:
in a church ceremony at the Pro-Cathedral in San Miguel, Bulacan on September 12,
1948. In ATTY. LUNA’s marriage to EUGENIA, they begot seven (7) children, "JUAN LUCES LUNA, married to Soledad L. Luna (38/100); MARIO E.
namely: Regina Maria L. Nadal, Juan Luis Luna, Araceli Victoria L. Arellano, Ana ONGKIKO, married to Sonia P.G. Ongkiko (50/100); TERESITA CRUZ SISON,
Maria L. Tabunda, Gregorio Macario Luna, Carolina Linda L. Tapia, and Cesar married to Antonio J.M. Sison (12/100) x x x"
Antonio Luna. After almost two (2) decades of marriage, ATTY. LUNA and
EUGENIA eventually agreed to live apart from each other in February 1966 and Sometime in 1992, LUPSICON was dissolved and the condominium unit was
agreed to separation of property, to which end, they entered into a written agreement partitioned by the partners but the same was still registered in common under CCT
entitled "AGREEMENT FOR SEPARATION AND PROPERTY SETTLEMENT" No. 21716. The parties stipulated that the interest of ATTY. LUNA over the
dated November 12, 1975, whereby they agreed to live separately and to dissolve and condominium unit would be 25/100 share. ATTY. LUNA thereafter established and
liquidate their conjugal partnership of property. headed another law firm with Atty. Renato G. Dela Cruz and used a portion of the
office condominium unit as their office. The said law firm lasted until the death of
ATTY. JUAN on July 12, 1997.
 (b) Plaintiff has no right as owner or under any other concept over the condominium
After the death of ATTY. JUAN, his share in the condominium unit including the unit, hence the entry in Condominium Certificate of Title No. 21761 of the Registry
lawbooks, office furniture and equipment found therein were taken over by Gregorio of Deeds of Makati with respect to the civil status of Juan Luces Luna should be
Z. Luna, ATTY. LUNA’s son of the first marriage. Gregorio Z. Luna then leased out changed from "JUAN LUCES LUNA married to Soledad L. Luna" to "JUAN
the 25/100 portion of the condominium unit belonging to his father to Atty. Renato G. LUCES LUNA married to Eugenia Zaballero Luna";
De la Cruz who established his own law firm named Renato G. De la Cruz &
Associates. (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 25/100 pro-indiviso share of ATTY. Luna in the condominium unit as well as the the condominium unit and defendants are ordered to deliver them to the plaintiff as
law books, office furniture and equipment became the subject of the complaint filed soon as appropriate arrangements have been madefor transport and storage.
by SOLEDAD against the heirs of ATTY. JUAN with the RTC of Makati City,
Branch 138, on September 10, 1999, docketed as Civil Case No. 99-1644. The No pronouncement as to costs.
complaint alleged that the subject properties were acquired during the existence of the
marriage between ATTY. LUNA and SOLEDAD through their joint efforts that since SO ORDERED.5
they had no children, SOLEDAD became co-owner of the said properties upon the
death of ATTY. LUNA to the extent of ¾ pro-indiviso share consisting of her ½ share Decision of the CA
in the said properties plus her ½ share in the net estate of ATTY. LUNA which was
bequeathed to her in the latter’s last will and testament; and that the heirs of ATTY. Both parties appealed to the CA.6
LUNA through Gregorio Z. Luna excluded SOLEDAD from her share in the subject
properties. The complaint prayed that SOLEDAD be declared the owner of the ¾ On her part, the petitioner assigned the following errors to the RTC, namely:
portion of the subject properties; that the same be partitioned; that an accounting of
the rentals on the condominium unit pertaining to the share of SOLEDAD be I. THE LOWER COURT ERRED IN RULING THAT THE CONDOMINIUM
conducted; that a receiver be appointed to preserve ad administer the subject UNIT WAS ACQUIRED THRU THE SOLE INDUSTRY OF ATTY. JUAN LUCES
properties; and that the heirs of ATTY. LUNA be ordered to pay attorney’s fees and LUNA;
costs of the suit to SOLEDAD.3
II. THE LOWER COURT ERRED IN RULING THAT PLAINTIFFAPPELLANT
Ruling of the RTC DID NOT CONTRIBUTE MONEY FOR THE ACQUISITION OF THE
CONDOMINIUM UNIT;
On August 27, 2001, the RTC rendered its decision after trial upon the
aforementioned facts,4 disposing thusly: III. THE LOWER COURT ERRED IN GIVING CREDENCE TO PORTIONS OF
THE TESTIMONY OF GREGORIO LUNA, WHO HAS NO ACTUAL
WHEREFORE, judgment is rendered as follows: KNOWLEDGE OF THE ACQUISITION OF THE UNIT, BUT IGNORED OTHER
PORTIONS OF HIS TESTIMONY FAVORABLE TO THE PLAINTIFF-
(a) The 24/100 pro-indiviso share in the condominium unit located at the SIXTH APPELLANT;
FLOOR of the KALAW LEDESMA CONDOMINIUM PROJECT covered by
Condominium Certificate of Title No. 21761 consisting of FIVE HUNDRED IV. THE LOWER COURT ERRED IN NOT GIVING SIGNIFICANCE TO THE
SEVENTEEN (517/100) SQUARE METERS is adjudged to have been acquired by FACT THAT THE CONJUGAL PARTNERSHIP BETWEEN LUNA AND
Juan Lucas Luna through his sole industry; INTERVENOR-APPELLANT WAS ALREADY DISSOLVED AND
LIQUIDATED PRIOR TO THE UNION OF PLAINTIFF-APPELLANT AND On November 11, 2005, the CA promulgated its assailed modified decision,9 holding
LUNA; and ruling:

V. THE LOWER COURT ERRED IN GIVING UNDUE SIGNIFICANCE TO THE EUGENIA, the first wife, was the legitimate wife of ATTY. LUNA until the latter’s
ABSENCE OF THE DISPOSITION OF THE CONDOMINIUM UNIT IN THE death on July 12, 1997. The absolute divorce decree obtained by ATTY. LUNA inthe
HOLOGRAPHIC WILL OF THE PLAINTIFF-APPELLANT; Dominican Republic did not terminate his prior marriage with EUGENIA because
foreign divorce between Filipino citizens is not recognized in our jurisdiction. x x x10
VI. THE LOWER COURT ERRED IN GIVING UNDUE SIGNIFICANCE TO THE
FACTTHAT THE NAME OF PLAINTIFF-APPELLANT DID NOT APPEAR IN xxxx
THE DEED OF ABSOLUTE SALE EXECUTED BY TANDANG SORA
DEVELOPMENT CORPORATION OVER THE CONDOMINIUM UNIT; WHEREFORE, premises considered, the assailed August 27, 2001 Decision of the
RTC of MakatiCity, Branch 138, is hereby MODIFIEDas follows:
VII. THE LOWER COURT ERRED IN RULING THAT NEITHER ARTICLE 148
OF THE FAMILYCODE NOR ARTICLE 144 OF THE CIVIL CODE OF THE (a) The 25/100 pro-indiviso share in the condominium unit at the SIXTH FLOOR of
PHILIPPINES ARE APPLICABLE; the KALAW LEDESMA CONDOMINIUM PROJECT covered by Condominium
Certificate of Title No. 21761 consisting of FIVE HUNDRED SEVENTEEN
VIII. THE LOWER COURT ERRED IN NOT RULING THAT THE CAUSE OF (517/100) (sic) SQUARE METERS is hereby adjudged to defendants-appellants, the
ACTION OF THE INTERVENOR-APPELLANT HAS BEEN BARRED BY heirs of Juan Luces Luna and Eugenia Zaballero-Luna (first marriage), having been
PESCRIPTION AND LACHES; and acquired from the sole funds and sole industry of Juan Luces Luna while marriage of
Juan Luces Luna and Eugenia Zaballero-Luna (first marriage) was still subsisting and
IX. THE LOWER COURT ERRED IN NOT EXPUNGING/DISMISSING THE valid;
INTERVENTION FOR FAILURE OF INTERVENOR-APPELLANT TO PAY
FILING FEE.7 (b) Plaintiff-appellant Soledad Lavadia has no right as owner or under any other
concept over the condominium unit, hence the entry in Condominium Certificate of
In contrast, the respondents attributedthe following errors to the trial court, to wit: Title No. 21761 of the Registry of Deeds ofMakati with respect to the civil status of
Juan Luces Luna should be changed from "JUAN LUCES LUNA married to Soledad
I. THE LOWER COURT ERRED IN HOLDING THAT CERTAIN FOREIGN LAW L. Luna" to "JUAN LUCES LUNA married to Eugenia Zaballero Luna";
BOOKS IN THE LAW OFFICE OF ATTY. LUNA WERE BOUGHT WITH THE
USE OF PLAINTIFF’S MONEY; (c) Defendants-appellants, the heirs of Juan Luces Luna and Eugenia Zaballero-
Luna(first marriage) are hereby declared to be the owner of the books Corpus Juris,
II. THE LOWER COURT ERRED IN HOLDING THAT PLAINTIFF PROVED BY Fletcher on Corporation, American Jurisprudence and Federal Supreme Court Reports
PREPONDERANCE OF EVIDENCE (HER CLAIM OVER) THE SPECIFIED found in the condominium unit.
FOREIGN LAW BOOKS FOUND IN ATTY. LUNA’S LAW OFFICE; and
No pronouncement as to costs.
III. THE LOWER COURT ERRED IN NOT HOLDING THAT, ASSUMING
PLAINTIFF PAID FOR THE SAID FOREIGN LAW BOOKS, THE RIGHT TO SO ORDERED.11
RECOVER THEM HAD PRESCRIBED AND BARRED BY LACHES AND
ESTOPPEL.8 On March 13, 2006,12 the CA denied the petitioner’s motion for reconsideration.13
Issues 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
In this appeal, the petitioner avers in her petition for review on certiorari that: July 12, 1997 terminated their marriage.

A. The Honorable Court of Appeals erred in ruling that the Agreement for Separation From the time of the celebration of the first marriage on September 10, 1947 until the
and Property Settlement executed by Luna and Respondent Eugenia was present, absolute divorce between Filipino spouses has not been recognized in the
unenforceable; hence, their conjugal partnership was not dissolved and liquidated; 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.
B. The Honorable Court of Appeals erred in not recognizing the Dominican Republic Indeed, the only two types of defective marital unions under our laws have been the
court’s approval of the Agreement; 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
C. The Honorable Court of Appeals erred in ruling that Petitioner failed to adduce annulment of the marriage.
sufficient proof of actual contribution to the acquisition of purchase of the subject
condominium unit; and It is true that on January 12, 1976, the Court of First Instance (CFI) of Sto. Domingo
in the Dominican Republic issued the Divorce Decree dissolving the first marriage of
D. The Honorable Court of Appeals erred in ruling that Petitioner was not entitled to Atty. Luna and Eugenia. Conformably with the nationality rule, however, the divorce,
the subject law books. 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. This
The decisive question to be resolved is who among the contending parties should be finding conforms to the Constitution, which characterizes marriage as an inviolable
entitled to the 25/100 pro indiviso share in the condominium unit; and to the law social institution, and regards it as a special contract of permanent union between a
books (i.e., Corpus Juris, Fletcher on Corporation, American Jurisprudence and man and a woman for the establishment of a conjugal and family life. The non-
Federal Supreme Court Reports). recognition of absolute divorce in the Philippines is a manifestation of the respect for
the sanctity of the marital union especially among Filipino citizens. It affirms that the
The resolution of the decisive question requires the Court to ascertain the law that extinguishment of a valid marriage must be grounded only upon the death of either
should determine, firstly, whether the divorce between Atty. Luna and Eugenia spouse, or upon a ground expressly provided bylaw. For as long as this public policy
Zaballero-Luna (Eugenia) had validly dissolved the first marriage; and, secondly, on marriage between Filipinos exists, no divorce decree dissolving the marriage
whether the second marriage entered into by the late Atty. Luna and the petitioner between them can ever be given legal or judicial recognition and enforcement in this
entitled the latter to any rights in property. Ruling of the Court jurisdiction.

We affirm the modified decision of the CA. 2. The Agreement for Separation and Property Settlement was void for lack of court
approval
1. Atty. Luna’s first marriage with Eugenia subsisted up to the time of his death
The petitioner insists that the Agreement for Separation and Property Settlement
The first marriage between Atty. Luna and Eugenia, both Filipinos, was solemnized (Agreement) that the late Atty. Luna and Eugenia had entered into and executed in
in the Philippines on September 10, 1947. The law in force at the time of the connection with the divorce proceedings before the CFI of Sto. Domingo in the
solemnization was the Spanish Civil Code, which adopted the nationality rule. The Dominican Republic to dissolve and liquidate their conjugal partnership was
Civil Code continued to follow the nationality rule, to the effect that Philippine laws enforceable against Eugenia. Hence, the CA committed reversible error in decreeing
relating to family rights and duties, or to the status, condition and legal capacity of otherwise.
persons were binding upon citizens of the Philippines, although living abroad.
The insistence of the petitioner was unwarranted. Agreement by a competent court was still required under Article 190 and Article 191
of the Civil Code, as follows:
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 Article 190. In the absence of an express declaration in the marriage settlements, the
community or conjugal partnership of gains governed their property relations. This is separation of property between spouses during the marriage shall not take place save
because the Spanish Civil Code, the law then in force at the time of their marriage, in virtue of a judicial order. (1432a)
did not specify the property regime of the spouses in the event that they had not
entered into any marriage settlement before or at the time of the marriage. Article 119 Article 191. The husband or the wife may ask for the separation of property, and it
of the Civil Code clearly so provides, to wit: shall be decreed when the spouse of the petitioner has been sentenced to a penalty
which carries with it civil interdiction, or has been declared absent, or when legal
Article 119. The future spouses may in the marriage settlements agree upon absolute separation has been granted.
or relative community of property, or upon complete separation of property, or upon
any other regime. In the absence of marriage settlements, or when the same are void, xxxx
the system of relative community or conjugal partnership of gains as established in
this Code, shall govern the property relations between husband and wife. The husband and the wife may agree upon the dissolution of the conjugal partnership
during the marriage, subject to judicial approval. All the creditors of the husband and
Article 142 of the Civil Code has defined a conjugal partnership of gains thusly: of the wife, as well as of the conjugal partnership shall be notified of any petition for
judicial approval or the voluntary dissolution of the conjugal partnership, so that any
Article 142. By means of the conjugal partnership of gains the husband and wife such creditors may appear at the hearing to safeguard his interests. Upon approval of
place in a common fund the fruits of their separate property and the income from their the petition for dissolution of the conjugal partnership, the court shall take such
work or industry, and divide equally, upon the dissolution of the marriage or of the measures as may protect the creditors and other third persons.
partnership, the net gains or benefits obtained indiscriminately by either spouse
during the marriage. 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
The conjugal partnership of gains subsists until terminated for any of various causes articles 498 to 501 shall be applicable. (1433a)
of termination enumerated in Article 175 of the Civil Code, viz:
But was not the approval of the Agreement by the CFI of Sto. Domingo in the
Article 175. The conjugal partnership of gains terminates: Dominican Republic sufficient in dissolving and liquidating the conjugal partnership
of gains between the late Atty. Luna and Eugenia?
(1) Upon the death of either spouse;
The query is answered in the negative. There is no question that the approval took
(2) When there is a decree of legal separation; 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
(3) When the marriage is annulled; 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
(4) In case of judicial separation of property under Article 191. 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
The mere execution of the Agreement by Atty. Luna and Eugenia did not per se gains of Atty. Luna and Eugenia subsisted in the lifetime of their marriage.
dissolve and liquidate their conjugal partnership of gains. The approval of the
3. Atty. Luna’s marriage with Soledad, being bigamous, was void; properties petitioner to offer proof of her actual contributions in the acquisition of property. Her
acquired during their marriage were governed by the rules on co-ownership mere allegation of co-ownership, without sufficient and competent evidence, would
warrant no relief in her favor. As the Court explained in Saguid v. Court of
What law governed the property relations of the second marriage between Atty. Luna Appeals:25
and Soledad?
In the cases of Agapay v. Palang, and Tumlos v. Fernandez, which involved the issue
The CA expressly declared that Atty. Luna’s subsequent marriage to Soledad on of co-ownership of properties acquired by the parties to a bigamous marriage and an
January 12, 1976 was void for being bigamous, on the ground that the marriage adulterous relationship, respectively, we ruled that proof of actual contribution in the
between Atty. Luna and Eugenia had not been dissolved by the Divorce Decree acquisition of the property is essential. The claim of co-ownership of the petitioners
rendered by the CFI of Sto. Domingo in the Dominican Republic but had subsisted therein who were parties to the bigamous and adulterous union is without basis
until the death of Atty. Luna on July 12, 1997. because they failed to substantiate their allegation that they contributed money in the
purchase of the disputed properties. Also in Adriano v. Court of Appeals, we ruled
The Court concurs with the CA. that the fact that the controverted property was titled in the name of the parties to an
adulterous relationship is not sufficient proof of coownership absent evidence of
In the Philippines, marriages that are bigamous, polygamous, or incestuous are void. actual contribution in the acquisition of the property.
Article 71 of the Civil Code clearly states:
As in other civil cases, the burden of proof rests upon the party who, as determined by
Article 71. All marriages performed outside the Philippines in accordance with the the pleadings or the nature of the case, asserts an affirmative issue. Contentions must
laws in force in the country where they were performed, and valid there as such, shall be proved by competent evidence and reliance must be had on the strength of the
also be valid in this country, except bigamous, polygamous, or incestuous marriages party’s own evidence and not upon the weakness of the opponent’s defense. This
as determined by Philippine law. applies with more vigor where, as in the instant case, the plaintiff was allowed to
present evidence ex parte.1âwphi1 The plaintiff is not automatically entitled to the
Bigamy is an illegal marriage committed by contracting a second or subsequent relief prayed for. The law gives the defendant some measure of protection as the
marriage before the first marriage has been legally dissolved, or before the absent plaintiff must still prove the allegations in the complaint. Favorable relief can be
spouse has been declared presumptively dead by means of a judgment rendered in the granted only after the court is convinced that the facts proven by the plaintiff warrant
proper proceedings. A bigamous marriage is considered void ab initio. such relief. Indeed, the party alleging a fact has the burden of proving it and a mere
allegation is not evidence.
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 The petitioner asserts herein that she sufficiently proved her actual contributions in
were governed by the rules on co-ownership, conformably with Article 144 of the the purchase of the condominium unit in the aggregate amount of at least
Civil Code, viz: ₱306,572.00, consisting in direct contributions of ₱159,072.00, and in repaying the
loans Atty. Luna had obtained from Premex Financing and Banco Filipino totaling
Article 144. When a man and a woman live together as husband and wife, but they ₱146,825.30;27 and that such aggregate contributions of ₱306,572.00 corresponded
are not married, or their marriage is void from the beginning, the property acquired by to almost the entire share of Atty. Luna in the purchase of the condominium unit
either or both of them through their work or industry or their wages and salaries shall amounting to ₱362,264.00 of the unit’s purchase price of ₱1,449,056.00.28 The
be governed by the rules on co-ownership.(n) 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
In such a situation, whoever alleges co-ownership carried the burden of proof to the financial capacity to make the contributions and purchases; and that Atty. Luna
confirm such To establish co-ownership, therefore, it became imperative for the
could not acquire the properties on his own due to the meagerness of the income As to the 25/100pro-indivisoshare of ATTY. LUNA in the condominium unit,
derived from his law practice. SOLEDAD failed to prove that she made an actual contribution to purchase the said
property. She failed to establish that the four (4) checks that she presented were
Did the petitioner discharge her burden of proof on the co-ownership? indeed used for the acquisition of the share of ATTY. LUNA in the condominium
unit. This was aptly explained in the Decision of the trial court, viz.:
In resolving the question, the CA entirely debunked the petitioner’s assertions on her
actual contributions through the following findings and conclusions, namely: "x x x The first check, Exhibit "M" for ₱55,000.00 payable to Atty. Teresita Cruz
Sison was issued on January 27, 1977, which was thirteen (13) months before the
SOLEDAD was not able to prove by preponderance of evidence that her own Memorandum of Agreement, Exhibit "7" was signed. Another check issued on April
independent funds were used to buy the law office condominium and the law books 29, 1978 in the amount of ₱97,588.89, Exhibit "P" was payable to Banco Filipino.
subject matter in contention in this case – proof that was required for Article 144 of According to the plaintiff, this was in payment of the loan of Atty. Luna. The third
the New Civil Code and Article 148 of the Family Code to apply – as to cases where check which was for ₱49,236.00 payable to PREMEX was dated May 19, 1979, also
properties were acquired by a man and a woman living together as husband and wife for payment of the loan of Atty. Luna. The fourth check, Exhibit "M", for ₱4,072.00
but not married, or under a marriage which was void ab initio. Under Article 144 of was dated December 17, 1980. None of the foregoing prove that the amounts
the New Civil Code, the rules on co-ownership would govern. But this was not delivered by plaintiff to the payees were for the acquisition of the subject
readily applicable to many situations and thus it created a void at first because it condominium unit. The connection was simply not established. x x x"
applied only if the parties were not in any way incapacitated or were without
impediment to marry each other (for it would be absurd to create a co-ownership SOLEDAD’s claim that she made a cash contribution of ₱100,000.00 is
where there still exists a prior conjugal partnership or absolute community between unsubstantiated. Clearly, there is no basis for SOLEDAD’s claim of co-ownership
the man and his lawful wife). This void was filled upon adoption of the Family Code. over the 25/100 portion of the condominium unit and the trial court correctly found
that the same was acquired through the sole industry of ATTY. LUNA, thus:
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 "The Deed of Absolute Sale, Exhibit "9", covering the condominium unit was in the
common and in proportion to their respective contributions. Such contributions and name of Atty. Luna, together with his partners in the law firm. The name of the
corresponding shares were prima facie presumed to be equal. However, for this plaintiff does not appear as vendee or as the spouse of Atty. Luna. The same was
presumption to arise, proof of actual contribution was required. The same rule and acquired for the use of the Law firm of Atty. Luna. The loans from Allied Banking
presumption was to apply to joint deposits of money and evidence of credit. If one of Corporation and Far East Bank and Trust Company were loans of Atty. Luna and his
the parties was validly married to another, his or her share in the co-ownership partners and plaintiff does not have evidence to show that she paid for them fully or
accrued to the absolute community or conjugal partnership existing in such valid partially. x x x"
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 The fact that CCT No. 4779 and subsequently, CCT No. 21761 were in the name of
147. The rules on forfeiture applied even if both parties were in bad faith. Co- "JUAN LUCES LUNA, married to Soledad L. Luna" was no proof that SOLEDAD
ownership was the exception while conjugal partnership of gains was the strict rule was a co-owner of the condominium unit. Acquisition of title and registration thereof
whereby marriage was an inviolable social institution and divorce decrees are not are two different acts. It is well settled that registration does not confer title but
recognized in the Philippines, as was held by the Supreme Court in the case of merely confirms one already existing. The phrase "married to" preceding "Soledad L.
Tenchavez vs. Escaño, G.R. No. L-19671, November 29, 1965, 15 SCRA 355, thus: Luna" is merely descriptive of the civil status of ATTY. LUNA.

xxxx 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 Before the Court is a petition for review assailing the 9 May 2008 Decision 1 of the
actually purchased or paid for the law office amortization and for the law books. It is Court of Appeals in CA-G.R .. CV No. 88686, which affirmed in part the 8 December
more logical to presume that it was ATTY. LUNA who bought the law office space 2006 Decision2 of the Regional Trial Court (RTC) of Baler, Aurora, Branch 96.
and the law books from his earnings from his practice of law rather than
embarrassingly beg or ask from SOLEDAD money for use of the law firm that he The factual antecedents are as follow:
headed.
David A. Noveras (David) and Leticia T. Noveras (Leticia) were married on 3
The Court upholds the foregoing findings and conclusions by the CA both because December 1988 in Quezon City, Philippines. They resided in California, United
they were substantiated by the records and because we have not been shown any States of America (USA) where they eventually acquired American citizenship. They
reason to revisit and undo them. Indeed, the petitioner, as the party claiming the co- then begot two children, namely: Jerome T. Noveras, who was born on 4 November
ownership, did not discharge her burden of proof. Her mere allegations on her 1990 and Jena T. Noveras, born on 2 May 1993. David was engaged in courier
contributions, not being evidence did not serve the purpose. In contrast, given the service business while Leticia worked as a nurse in San Francisco, California.
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 During the marriage, they acquired the following properties in the Philippines and in
remained. It should then be justly concluded that the properties in litis legally the USA:
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 PHILIPPINES
heirs of Atty. Luna.
PROPERTY FAIR MARKET VALUE
WHEREFORE, the Court AFFIRMS the decision promulgated on November 11,
House and Lot with an area of 150 sq. m. ₱1,693,125.00
2005; and ORDERS the petitioner to pay the costs of suit.
located at 1085 Norma Street, Sampaloc,
Manila (Sampaloc property)
SO ORDERED.
Agricultural land with an area of 20,742 sq. ₱400,000.00
m. located at Laboy, Dipaculao, Aurora
G.R. No. 188289               August 20, 2014 A parcel of land with an area of 2.5 ₱490,000.00
hectares located at Maria Aurora, Aurora
DAVID A. NOVERAS, Petitioner, 3
vs. A parcel of land with an area of 175 sq.m. ₱175,000.00
located at Sabang Baler, Aurora
LETICIA T. NOVERAS, Respondent.
3-has. coconut plantation in San Joaquin ₱750,000.00
DECISION Maria Aurora, Aurora

PEREZ, J.: USA

PROPERTY FAIR MARKET VALUE

 House and Lot at 1155 Hanover Street, to collect ₱1,790,000.00 from the sale of the Sampaloc property, leaving an unpaid
Daly City, California balance of ₱410,000.00.

$550,000.00 Upon learning that David had an extra-marital affair, Leticia filed a petition for
(unpaid debt of divorce with the Superior Court of California, County of San Mateo, USA. The
$285,000.00) California court granted the divorce on 24 June 2005 and judgment was duly entered
Furniture and furnishings $3,000 on 29 June 2005.6 The California court granted to Leticia the custody of her two
children, as well as all the couple’s properties in the USA.7
Jewelries (ring and watch) $9,000
On 8 August 2005, Leticia filed a petition for Judicial Separation of Conjugal
Property before the RTC of Baler, Aurora. She relied on the 3 December 2003 Joint
2000 Nissan Frontier 4x4 pickup truck $13,770.00
Affidavit and David’s failure to comply with his obligation under the same. She
prayed for: 1) the power to administer all conjugal properties in the Philippines; 2)
Bank of America Checking Account $8,000 David and his partner to cease and desist from selling the subject conjugal properties;
3) the declaration that all conjugal properties be forfeited in favor of her children; 4)
Bank of America Cash Deposit David to remit half of the purchase price as share of Leticia from the sale of the
Sampaloc property; and 5) the payment of₱50,000.00 and ₱100,000.00 litigation
Life Insurance (Cash Value) $100,000.00 expenses.8
4
Retirement, pension, profit-sharing, $56,228.00 In his Answer, David stated that a judgment for the dissolution of their marriage was
annuities entered on 29 June 2005 by the Superior Court of California, County of San Mateo.
He demanded that the conjugal partnership properties, which also include the USA
The Sampaloc property used to be owned by David’s parents. The parties herein properties, be liquidated and that all expenses of liquidation, including attorney’s fees
secured a loan from a bank and mortgaged the property. When said property was of both parties be charged against the conjugal partnership.9
about to be foreclosed, the couple paid a total of ₱1.5 Million for the redemption of
the same. The RTC of Baler, Aurora simplified the issues as follow:

Due to business reverses, David left the USA and returned to the Philippines in 2001. 1. Whether or not respondent David A. Noveras committed acts of
In December 2002, Leticia executed a Special Power of Attorney (SPA) authorizing abandonment and marital infidelity which can result into the forfeiture of the
David to sell the Sampaloc property for ₱2.2 Million. According to Leticia, sometime parties’ properties in favor of the petitioner and their two (2) children.
in September 2003, David abandoned his family and lived with Estrellita Martinez in
Aurora province. Leticia claimed that David agreed to and executed a Joint Affidavit 2. Whether or not the Court has jurisdiction over the properties in California,
with Leticia in the presence of David’s father, Atty. Isaias Noveras, on 3 December U.S.A. and the same can be included in the judicial separation prayed for.
2003 stating that: 1) the ₱1.1Million proceeds from the sale of the Sampaloc property
shall be paid to and collected by Leticia; 2) that David shall return and pay to Leticia 3. Whether or not the "Joint Affidavit" x x x executed by petitioner Leticia T.
₱750,000.00, which is equivalent to half of the amount of the redemption price of the Noveras and respondent David A. Noveras will amount to a waiver or
Sampaloc property; and 3) that David shall renounce and forfeit all his rights and forfeiture of the latter’s property rights over their conjugal properties.
interest in the conjugal and real properties situated in the Philippines. 5 David was able
 4. Whether or not Leticia T. Noveras is entitled to reimbursement of one half 4. One-half of the properties in the United States of America awarded to
of the ₱2.2 [M]illion sales proceeds of their property in Sampaloc, Manila and petitioner Leticia Noveras a.k.a. Leticia Tacbiana in paragraph 2 are hereby
one-half of the ₱1.5 [M]illion used to redeem the property of Atty. Isaias given to Jerome and Jena, her two minor children with respondent David A.
Noveras, including interests and charges. Noveras as their presumptive legitimes and said legitimes must be annotated
on the titles/documents covering the said properties. Their share in the income
5. How the absolute community properties should be distributed. from these properties, if any, shall be remitted to them annually by the
petitioner within the first half of January of each year, starting January 2008;
6. Whether or not the attorney’s fees and litigation expenses of the parties
were chargeable against their conjugal properties. 5. For the support of their two (2) minor children, Jerome and Jena,
respondent David A. Noveras shall give them US$100.00 as monthly
Corollary to the above is the issue of: allowance in addition to their income from their presumptive legitimes, while
petitioner Leticia Tacbiana shall take care of their food, clothing, education
Whether or not the two common children of the parties are entitled to support and and other needs while they are in her custody in the USA. The monthly
presumptive legitimes.10 allowance due from the respondent shall be increased in the future as the
needs of the children require and his financial capacity can afford;
On 8 December 2006, the RTC rendered judgment as follows:
6. Of the unpaid amount of ₱410,000.00 on the purchase price of the
1. The absolute community of property of the parties is hereby declared Sampaloc property, the Paringit Spouses are hereby ordered to pay ₱5,000.00
DISSOLVED; to respondent David A. Noveras and ₱405,000.00 to the two children. The
share of the respondent may be paid to him directly but the share of the two
2. The net assets of the absolute community of property of the parties in the children shall be deposited with a local bank in Baler, Aurora, in a joint
Philippines are hereby ordered to be awarded to respondent David A. Noveras account to be taken out in their names, withdrawal from which shall only be
only, with the properties in the United States of America remaining in the sole made by them or by their representative duly authorized with a Special Power
ownership of petitioner Leticia Noveras a.k.a. Leticia Tacbiana pursuant to the of Attorney. Such payment/deposit shall be made within the period of thirty
divorce decree issued by the Superior Court of California, County of San (30) days after receipt of a copy of this Decision, with the passbook of the
Mateo, United States of America, dissolving the marriage of the parties as of joint account to be submitted to the custody of the Clerk of Court of this Court
June 24, 2005. The titles presently covering said properties shall be cancelled within the same period. Said passbook can be withdrawn from the Clerk of
and new titles be issued in the name of the party to whom said properties are Court only by the children or their attorney-in-fact; and
awarded;
7. The litigation expenses and attorney’s fees incurred by the parties shall be
3. One-half of the properties awarded to respondent David A. Noveras in the shouldered by them individually.11
preceding paragraph are hereby given to Jerome and Jena, his two minor
children with petitioner Leticia Noveras a.k.a. Leticia Tacbiana as their The trial court recognized that since the parties are US citizens, the laws that cover
presumptive legitimes and said legitimes must be annotated on the titles their legal and personal status are those of the USA. With respect to their marriage,
covering the said properties. Their share in the income from these properties the parties are divorced by virtue of the decree of dissolution of their marriage issued
shall be remitted to them annually by the respondent within the first half of by the Superior Court of California, County of San Mateo on 24June 2005. Under
January of each year, starting January 2008; their law, the parties’ marriage had already been dissolved. Thus, the trial court
considered the petition filed by Leticia as one for liquidation of the absolute
community of property regime with the determination of the legitimes, support and
custody of the children, instead of an action for judicial separation of conjugal presumptive legitimes which shall be annotated on the titles/documents
property. covering the said properties. Their share in the income therefrom, if any, shall
be remitted to them by petitioner annually within the first half of January,
With respect to their property relations, the trial court first classified their property starting 2008;
regime as absolute community of property because they did not execute any marriage
settlement before the solemnization of their marriage pursuant to Article 75 of the xxx
Family Code. Then, the trial court ruled that in accordance with the doctrine of
processual presumption, Philippine law should apply because the court cannot take 6. Respondent David A. Noveras and petitioner Leticia Tacbiana (sic) are
judicial notice of the US law since the parties did not submit any proof of their each ordered to pay the amount of ₱520,000.00 to their two children, Jerome
national law. The trial court held that as the instant petition does not fall under the and Jena, as their presumptive legitimes from the sale of the Sampaloc
provisions of the law for the grant of judicial separation of properties, the absolute property inclusive of the receivables therefrom, which shall be deposited to a
community properties cannot be forfeited in favor of Leticia and her children. local bank of Baler, Aurora, under a joint account in the latter’s names. The
Moreover, the trial court observed that Leticia failed to prove abandonment and payment/deposit shall be made within a period of thirty (30) days from receipt
infidelity with preponderant evidence. of a copy of this Decision and the corresponding passbook entrusted to the
custody of the Clerk of Court a quo within the same period, withdrawable
The trial court however ruled that Leticia is not entitled to the reimbursements she is only by the children or their attorney-in-fact.
praying for considering that she already acquired all of the properties in the USA.
Relying still on the principle of equity, the Court also adjudicated the Philippine A number 8 is hereby added, which shall read as follows:
properties to David, subject to the payment of the children’s presumptive legitimes.
The trial court held that under Article 89 of the Family Code, the waiver or 8. Respondent David A. Noveras is hereby ordered to pay petitioner Leticia
renunciation made by David of his property rights in the Joint Affidavit is void. Tacbiana (sic) the amount of ₱1,040,000.00 representing her share in the
proceeds from the sale of the Sampaloc property.
On appeal, the Court of Appeals modified the trial court’s Decision by directing the
equal division of the Philippine properties between the spouses. Moreover with The last paragraph shall read as follows:
respect to the common children’s presumptive legitime, the appellate court ordered
both spouses to each pay their children the amount of ₱520,000.00, thus: Send a copy of this Decision to the local civil registry of Baler, Aurora; the local civil
registry of Quezon City; the Civil Registrar General, National Statistics Office, Vibal
WHEREFORE, the instant appeal is PARTLY GRANTED. Numbers 2, 4 and 6 of Building, Times Street corner EDSA, Quezon City; the Office of the Registry of
the assailed Decision dated December 8, 2006 of Branch 96, RTC of Baler, Aurora Deeds for the Province of Aurora; and to the children, Jerome Noveras and Jena
Province, in Civil Case No. 828 are hereby MODIFIED to read as follows: Noveras.

2. The net assets of the absolute community of property of the parties in the The rest of the Decision is AFFIRMED.12
Philippines are hereby divided equally between petitioner Leticia Noveras
a.k.a. Leticia Tacbiana (sic) and respondent David A. Noveras; In the present petition, David insists that the Court of Appeals should have recognized
the California Judgment which awarded the Philippine properties to him because said
xxx judgment was part of the pleading presented and offered in evidence before the trial
court. David argues that allowing Leticia to share in the Philippine properties is
4. One-half of the properties awarded to petitioner Leticia Tacbiana (sic) in tantamount to unjust enrichment in favor of Leticia considering that the latter was
paragraph 2 shall pertain to her minor children, Jerome and Jena, as their already granted all US properties by the California court.
In summary and review, the basic facts are: David and Leticia are US citizens who The attestation must be under the official seal of the attesting officer, if there be any,
own properties in the USA and in the Philippines. Leticia obtained a decree of or if he be the clerk of a court having a seal, under the seal of such court.
divorce from the Superior Court of California in June 2005 wherein the court
awarded all the properties in the USA to Leticia. With respect to their properties in Based on the records, only the divorce decree was presented in evidence. The
the Philippines, Leticia filed a petition for judicial separation of conjugal properties. required certificates to prove its authenticity, as well as the pertinent California law
on divorce were not presented.
At the outset, the trial court erred in recognizing the divorce decree which severed the
bond of marriage between the parties. In Corpuz v. Sto. Tomas,13 we stated that: It may be noted that in Bayot v. Court of Appeals,16 we relaxed the requirement on
certification where we held that "[petitioner therein] was clearly an American citizen
The starting point in any recognition of a foreign divorce judgment is the when she secured the divorce and that divorce is recognized and allowed in any of the
acknowledgment that our courts do not take judicial notice of foreign judgments and States of the Union, the presentation of a copy of foreign divorce decree duly
laws. Justice Herrera explained that, as a rule, "no sovereign is bound to give effect authenticated by the foreign court issuing said decree is, as here, sufficient." In this
within its dominion to a judgment rendered by a tribunal of another country." This case however, it appears that there is no seal from the office where the divorce decree
means that the foreign judgment and its authenticity must be proven as facts under was obtained.
our rules on evidence, together with the alien’s applicable national law to show the
effect of the judgment on the alien himself or herself. The recognition may be made Even if we apply the doctrine of processual presumption 17 as the lower courts did
in an action instituted specifically for the purpose or in another action where a party with respect to the property regime of the parties, the recognition of divorce is
invokes the foreign decree as an integral aspect of his claim or defense.14 entirely a different matter because, to begin with, divorce is not recognized between
Filipino citizens in the Philippines. Absent a valid recognition of the divorce decree,
The requirements of presenting the foreign divorce decree and the national law of the it follows that the parties are still legally married in the Philippines. The trial court
foreigner must comply with our Rules of Evidence. Specifically, for Philippine courts thus erred in proceeding directly to liquidation.
to recognize a foreign judgment relating to the status of a marriage, a copy of the
foreign judgment may be admitted in evidence and proven as a fact under Rule 132, As a general rule, any modification in the marriage settlements must be made before
Sections 24 and 25, in relation to Rule 39, Section 48(b) of the Rules of Court.15 the celebration of marriage. An exception to this rule is allowed provided that the
modification is judicially approved and refers only to the instances provided in
Under Section 24 of Rule 132, the record of public documents of a sovereign Articles 66,67, 128, 135 and 136 of the Family Code.18
authority or tribunal may be proved by: (1) an official publication thereof or (2) a
copy attested by the officer having the legal custody thereof. Such official publication Leticia anchored the filing of the instant petition for judicial separation of property on
or copy must be accompanied, if the record is not kept in the Philippines, with a paragraphs 4 and 6 of Article 135 of the Family Code, to wit:
certificate that the attesting officer has the legal custody thereof. The certificate may
be issued by any of the authorized Philippine embassy or consular officials stationed Art. 135. Any of the following shall be considered sufficient cause for judicial
in the foreign country in which the record is kept, and authenticated by the seal of his separation of property:
office. The attestation must state, in substance, that the copy is a correct copy of the
original, or a specific part thereof, as the case may be, and must be under the official (1) That the spouse of the petitioner has been sentenced to a penalty which
seal of the attesting officer. carries with it civil interdiction;

Section 25 of the same Rule states that whenever a copy of a document or record is (2) That the spouse of the petitioner has been judicially declared an absentee;
attested for the purpose of evidence, the attestation must state, in substance, that the
copy is a correct copy of the original, or a specific part thereof, as the case may be.
 (3) That loss of parental authority of the spouse of petitioner has been decreed Separation in fact for one year as a ground to grant a judicial separation of property
by the court; was not tackled in the trial court’s decision because, the trial court erroneously treated
the petition as liquidation of the absolute community of properties.
(4) That the spouse of the petitioner has abandoned the latter or failed to
comply with his or her obligations to the family as provided for in Article 101; The records of this case are replete with evidence that Leticia and David had indeed
separated for more than a year and that reconciliation is highly improbable. First,
(5) That the spouse granted the power of administration in the marriage while actual abandonment had not been proven, it is undisputed that the spouses had
settlements has abused that power; and been living separately since 2003 when David decided to go back to the Philippines to
set up his own business. Second, Leticia heard from her friends that David has been
(6) That at the time of the petition, the spouses have been separated in fact for cohabiting with Estrellita Martinez, who represented herself as Estrellita Noveras.
at least one year and reconciliation is highly improbable. Editha Apolonio, who worked in the hospital where David was once confined,
testified that she saw the name of Estrellita listed as the wife of David in the Consent
In the cases provided for in Numbers (1), (2), and (3), the presentation of the final for Operation form.20 Third and more significantly, they had filed for divorce and it
judgment against the guilty or absent spouse shall be enough basis for the grant of the was granted by the California court in June 2005.
decree of judicial separation of property. (Emphasis supplied).
Having established that Leticia and David had actually separated for at least one year,
The trial court had categorically ruled that there was no abandonment in this case to the petition for judicial separation of absolute community of property should be
necessitate judicial separation of properties under paragraph 4 of Article 135 of the granted.
Family Code. The trial court ratiocinated:
The grant of the judicial separation of the absolute community property automatically
Moreover, abandonment, under Article 101 of the Family Code quoted above, must dissolves the absolute community regime, as stated in the 4th paragraph of Article 99
be for a valid cause and the spouse is deemed to have abandoned the other when of the Family Code, thus:
he/she has left the conjugal dwelling without intention of returning. The intention of
not returning is prima facie presumed if the allegedly [sic] abandoning spouse failed Art. 99. The absolute community terminates:
to give any information as to his or her whereabouts within the period of three months
from such abandonment. (1) Upon the death of either spouse;

In the instant case, the petitioner knows that the respondent has returned to and stayed (2) When there is a decree of legal separation;
at his hometown in Maria Aurora, Philippines, as she even went several times to visit
him there after the alleged abandonment. Also, the respondent has been going back to (3) When the marriage is annulled or declared void; or
the USA to visit her and their children until the relations between them worsened.
The last visit of said respondent was in October 2004 when he and the petitioner (4) In case of judicial separation of property during the marriage under
discussed the filing by the latter of a petition for dissolution of marriage with the Articles 134 to 138. (Emphasis supplied).
California court. Such turn for the worse of their relationship and the filing of the said
petition can also be considered as valid causes for the respondent to stay in the Under Article 102 of the same Code, liquidation follows the dissolution of the
Philippines.19 absolute community regime and the following procedure should apply:
Art. 102. Upon dissolution of the absolute community regime, the following the Civil Code clearly states that real property as well as personal property is subject
procedure shall apply: to the law of the country where it is situated. Thus, liquidation shall only be limited to
the Philippine properties.
(1) An inventory shall be prepared, listing separately all the properties of the
absolute community and the exclusive properties of each spouse. We affirm the modification made by the Court of Appeals with respect to the share of
the spouses in the absolute community properties in the Philippines, as well as the
(2) The debts and obligations of the absolute community shall be paid out of payment of their children’s presumptive legitimes, which the appellate court
its assets. In case of insufficiency of said assets, the spouses shall be solidarily explained in this wise:
liable for the unpaid balance with their separate properties in accordance with
the provisions of the second paragraph of Article 94. Leticia and David shall likewise have an equal share in the proceeds of the Sampaloc
property. While both claimed to have contributed to the redemption of the Noveras
(3) Whatever remains of the exclusive properties of the spouses shall property, absent a clear showing where their contributions came from, the same is
thereafter be delivered to each of them. presumed to have come from the community property. Thus, Leticia is not entitled to
reimbursement of half of the redemption money.
(4) The net remainder of the properties of the absolute community shall
constitute its net assets, which shall be divided equally between husband and David's allegation that he used part of the proceeds from the sale of the Sampaloc
wife, unless a different proportion or division was agreed upon in the marriage property for the benefit of the absolute community cannot be given full credence.
settlements, or unless there has been a voluntary waiver of such share Only the amount of ₱120,000.00 incurred in going to and from the U.S.A. may be
provided in this Code. For purposes of computing the net profits subject to charged thereto. Election expenses in the amount of ₱300,000.00 when he ran as
forfeiture in accordance with Articles 43, No. (2) and 63, No. (2),the said municipal councilor cannot be allowed in the absence of receipts or at least the
profits shall be the increase in value between the market value of the Statement of Contributions and Expenditures required under Section 14 of Republic
community property at the time of the celebration of the marriage and the Act No. 7166 duly received by the Commission on Elections. Likewise, expenses
market value at the time of its dissolution. incurred to settle the criminal case of his personal driver is not deductible as the same
had not benefited the family. In sum, Leticia and David shall share equally in the
(5) The presumptive legitimes of the common children shall be delivered upon proceeds of the sale net of the amount of ₱120,000.00 or in the respective amounts of
partition, in accordance with Article 51. ₱1,040,000.00.

(6) Unless otherwise agreed upon by the parties, in the partition of the xxxx
properties, the conjugal dwelling and the lot on which it is situated shall be
adjudicated to the spouse with whom the majority of the common children Under the first paragraph of Article 8 of the Civil Code, "(t)he legitime of legitimate
choose to remain. Children below the age of seven years are deemed to have children and descendants consists of one-half or the hereditary estate of the father and
chosen the mother, unless the court has decided otherwise. In case there is no of the mother." The children arc therefore entitled to half of the share of each spouse
such majority, the court shall decide, taking into consideration the best in the net assets of the absolute community, which shall be annotated on the
interests of said children. At the risk of being repetitious, we will not remand titles/documents covering the same, as well as to their respective shares in the net
the case to the trial court. Instead, we shall adopt the modifications made by proceeds from the sale of the Sampaloc property including the receivables from Sps.
the Court of Appeals on the trial court’s Decision with respect to liquidation. Paringit in the amount of ₱410,000.00. Consequently, David and Leticia should each
pay them the amount of ₱520,000.00 as their presumptive legitimes therefrom.21
We agree with the appellate court that the Philippine courts did not acquire
jurisdiction over the California properties of David and Leticia. Indeed, Article 16 of
WHEREFORE, the petition is DENIED. The assailed Decision of the Court of Eleven months after, on November 25, 1977, Nenita C. Paguia filed a petition for the
Appeals in CA G.R. CV No. 88686 is AFFIRMED. reprobate of a will of the deceased, Adoracion Campos, which was allegedly executed
in the United States and for her appointment as administratrix of the estate of the
SO ORDERED. deceased testatrix.

In her petition, Nenita alleged that the testatrix was an American citizen at the time of
her death and was a permanent resident of 4633 Ditman Street, Philadelphia,
G.R. No. L-54919 May 30, 1984 Pennsylvania, U.S.A.; that the testatrix died in Manila on January 31, 1977 while
temporarily residing with her sister at 2167 Leveriza, Malate, Manila; that during her
lifetime, the testatrix made her last wig and testament on July 10, 1975, according to
POLLY CAYETANO, petitioner, the laws of Pennsylvania, U.S.A., nominating Wilfredo Barzaga of New Jersey as
vs. executor; that after the testatrix death, her last will and testament was presented,
probated, allowed, and registered with the Registry of Wins at the County of
HON. TOMAS T. LEONIDAS, in his capacity as the Philadelphia, U.S.A., that Clement L. McLaughlin, the administrator who was
Presiding Judge of Branch XXXVIII, Court of First appointed after Dr. Barzaga had declined and waived his appointment as executor in
Instance of Manila and NENITA CAMPOS PAGUIA, favor of the former, is also a resident of Philadelphia, U.S.A., and that therefore, there
is an urgent need for the appointment of an administratrix to administer and
respondents. eventually distribute the properties of the estate located in the Philippines.

Ermelo P. Guzman for petitioner. On January 11, 1978, an opposition to the reprobate of the will was filed by herein
petitioner alleging among other things, that he has every reason to believe that the
will in question is a forgery; that the intrinsic provisions of the will are null and void;
Armando Z. Gonzales for private respondent. and that even if pertinent American laws on intrinsic provisions are invoked, the same
could not apply inasmuch as they would work injustice and injury to him.

GUTIERREZ, JR., J.: On December 1, 1978, however, the petitioner through his counsel, Atty. Franco
Loyola, filed a Motion to Dismiss Opposition (With Waiver of Rights or Interests)
This is a petition for review on certiorari, seeking to annul the order of the respondent stating that he "has been able to verify the veracity thereof (of the will) and now
judge of the Court of First Instance of Manila, Branch XXXVIII, which admitted to confirms the same to be truly the probated will of his daughter Adoracion." Hence, an
and allowed the probate of the last will and testament of Adoracion C. Campos, after ex-parte presentation of evidence for the reprobate of the questioned will was made.
an ex-parte presentation of evidence by herein private respondent.
On January 10, 1979, the respondent judge issued an order, to wit:
On January 31, 1977, Adoracion C. Campos died, leaving her father, petitioner
Hermogenes Campos and her sisters, private respondent Nenita C. Paguia, Remedios At the hearing, it has been satisfactorily established that Adoracion C. Campos, in her
C. Lopez and Marieta C. Medina as the surviving heirs. As Hermogenes Campos was lifetime, was a citizen of the United States of America with a permanent residence at
the only compulsory heir, he executed an Affidavit of Adjudication under Rule 74, 4633 Ditman Street, Philadelphia, PA 19124, (Exhibit D) that when alive, Adoracion
Section I of the Rules of Court whereby he adjudicated unto himself the ownership of C. Campos executed a Last Will and Testament in the county of Philadelphia,
the entire estate of the deceased Adoracion Campos. Pennsylvania, U.S.A., according to the laws thereat (Exhibits E-3 to E-3-b) that while
in temporary sojourn in the Philippines, Adoracion C. Campos died in the City of
Manila (Exhibit C) leaving property both in the Philippines and in the United States Court. Until this Motion is resolved, may I also request for the future setting of the
of America; that the Last Will and Testament of the late Adoracion C. Campos was case for hearing on the Oppositor's motion to set aside previously filed.
admitted and granted probate by the Orphan's Court Division of the Court of
Common Pleas, the probate court of the Commonwealth of Pennsylvania, County of The hearing of May 29, 1980 was re-set by the court for June 19, 1980. When the
Philadelphia, U.S.A., and letters of administration were issued in favor of Clement J. case was called for hearing on this date, the counsel for petitioner tried to argue his
McLaughlin all in accordance with the laws of the said foreign country on procedure motion to vacate instead of adducing evidence in support of the petition for relief.
and allowance of wills (Exhibits E to E-10); and that the petitioner is not suffering Thus, the respondent judge issued an order dismissing the petition for relief for failure
from any disqualification which would render her unfit as administratrix of the estate to present evidence in support thereof. Petitioner filed a motion for reconsideration
in the Philippines of the late Adoracion C. Campos. but the same was denied. In the same order, respondent judge also denied the motion
to vacate for lack of merit. Hence, this petition.
WHEREFORE, the Last Will and Testament of the late Adoracion C. Campos is
hereby admitted to and allowed probate in the Philippines, and Nenita Campos Paguia Meanwhile, on June 6,1982, petitioner Hermogenes Campos died and left a will,
is hereby appointed Administratrix of the estate of said decedent; let Letters of which, incidentally has been questioned by the respondent, his children and forced
Administration with the Will annexed issue in favor of said Administratrix upon her heirs as, on its face, patently null and void, and a fabrication, appointing Polly
filing of a bond in the amount of P5,000.00 conditioned under the provisions of Cayetano as the executrix of his last will and testament. Cayetano, therefore, filed a
Section I, Rule 81 of the Rules of Court. motion to substitute herself as petitioner in the instant case which was granted by the
court on September 13, 1982.
Another manifestation was filed by the petitioner on April 14, 1979, confirming the
withdrawal of his opposition, acknowledging the same to be his voluntary act and A motion to dismiss the petition on the ground that the rights of the petitioner
deed. Hermogenes Campos merged upon his death with the rights of the respondent and her
sisters, only remaining children and forced heirs was denied on September 12, 1983.
On May 25, 1979, Hermogenes Campos filed a petition for relief, praying that the
order allowing the will be set aside on the ground that the withdrawal of his Petitioner Cayetano persists with the allegations that the respondent judge acted
opposition to the same was secured through fraudulent means. According to him, the without or in excess of his jurisdiction when:
"Motion to Dismiss Opposition" was inserted among the papers which he signed in
connection with two Deeds of Conditional Sales which he executed with the 1) He ruled the petitioner lost his standing in court deprived the Right to Notice (sic)
Construction and Development Corporation of the Philippines (CDCP). He also upon the filing of the Motion to Dismiss opposition with waiver of rights or interests
alleged that the lawyer who filed the withdrawal of the opposition was not his against the estate of deceased Adoracion C. Campos, thus, paving the way for the
counsel-of-record in the special proceedings case. hearing ex-parte of the petition for the probate of decedent will.

The petition for relief was set for hearing but the petitioner failed to appear. He made 2) He ruled that petitioner can waive, renounce or repudiate (not made in a public or
several motions for postponement until the hearing was set on May 29, 1980. authenticated instrument), or by way of a petition presented to the court but by way of
a motion presented prior to an order for the distribution of the estate-the law
On May 18, 1980, petitioner filed another motion entitled "Motion to Vacate and/or especially providing that repudiation of an inheritance must be presented, within 30
Set Aside the Order of January 10, 1979, and/or dismiss the case for lack of days after it has issued an order for the distribution of the estate in accordance with
jurisdiction. In this motion, the notice of hearing provided: the rules of Court.

Please include this motion in your calendar for hearing on May 29, 1980 at 8:30 in
the morning for submission for reconsideration and resolution of the Honorable
3) He ruled that the right of a forced heir to his legitime can be divested by a decree
admitting a will to probate in which no provision is made for the forced heir in In the case at bar, the petitioner maintains that since the respondent judge allowed the
complete disregard of Law of Succession reprobate of Adoracion's will, Hermogenes C. Campos was divested of his legitime
which was reserved by the law for him.
4) He denied petitioner's petition for Relief on the ground that no evidence was
adduced to support the Petition for Relief when no Notice nor hearing was set to This contention is without merit.
afford petitioner to prove the merit of his petition — a denial of the due process and a
grave abuse of discretion amounting to lack of jurisdiction. Although on its face, the will appeared to have preterited the petitioner and thus, the
respondent judge should have denied its reprobate outright, the private respondents
5) He acquired no jurisdiction over the testate case, the fact that the Testator at the have sufficiently established that Adoracion was, at the time of her death, an
time of death was a usual resident of Dasmariñas, Cavite, consequently Cavite Court American citizen and a permanent resident of Philadelphia, Pennsylvania, U.S.A.
of First Instance has exclusive jurisdiction over the case (De Borja vs. Tan, G.R. No. Therefore, under Article 16 par. (2) and 1039 of the Civil Code which respectively
L-7792, July 1955). provide:

The first two issues raised by the petitioner are anchored on the allegation that the Art. 16 par. (2).
respondent judge acted with grave abuse of discretion when he allowed the
withdrawal of the petitioner's opposition to the reprobate of the will. xxx xxx xxx

We find no grave abuse of discretion on the part of the respondent judge. No proof However, intestate and testamentary successions, both with respect to the order of
was adduced to support petitioner's contention that the motion to withdraw was succession and to the amount of successional rights and to the intrinsic validity of
secured through fraudulent means and that Atty. Franco Loyola was not his counsel testamentary provisions, shall be regulated by the national law of the person whose
of record. The records show that after the firing of the contested motion, the petitioner succession is under consideration, whatever may be the nature of the property and
at a later date, filed a manifestation wherein he confirmed that the Motion to Dismiss regardless of the country wherein said property may be found.
Opposition was his voluntary act and deed. Moreover, at the time the motion was
filed, the petitioner's former counsel, Atty. Jose P. Lagrosa had long withdrawn from Art. 1039.
the case and had been substituted by Atty. Franco Loyola who in turn filed the
motion. The present petitioner cannot, therefore, maintain that the old man's attorney Capacity to succeed is governed by the law of the nation of the decedent.
of record was Atty. Lagrosa at the time of filing the motion. Since the withdrawal was
in order, the respondent judge acted correctly in hearing the probate of the will ex- the law which governs Adoracion Campo's will is the law of Pennsylvania, U.S.A.,
parte, there being no other opposition to the same. which is the national law of the decedent. Although the parties admit that the
Pennsylvania law does not provide for legitimes and that all the estate may be given
The third issue raised deals with the validity of the provisions of the will. As a away by the testatrix to a complete stranger, the petitioner argues that such law
general rule, the probate court's authority is limited only to the extrinsic validity of should not apply because it would be contrary to the sound and established public
the will, the due execution thereof, the testatrix's testamentary capacity and the policy and would run counter to the specific provisions of Philippine Law.
compliance with the requisites or solemnities prescribed by law. The intrinsic validity
of the will normally comes only after the court has declared that the will has been It is a settled rule that as regards the intrinsic validity of the provisions of the will, as
duly authenticated. However, where practical considerations demand that the intrinsic provided for by Article 16(2) and 1039 of the Civil Code, the national law of the
validity of the will be passed upon, even before it is probated, the court should meet decedent must apply. This was squarely applied in the case of Bellis v. Bellis (20
the issue. (Maninang vs. Court of Appeals, 114 SCRA 478). SCRA 358) wherein we ruled:
 proceeding, except in an appeal from that court, in the original case, or when the want
It is therefore evident that whatever public policy or good customs may be involved of jurisdiction appears on the record.
in our system of legitimes, Congress has not intended to extend the same to the
succession of foreign nationals. For it has specifically chosen to leave, inter alia, the Therefore, the settlement of the estate of Adoracion Campos was correctly filed with
amount of successional rights, to the decedent's national law. Specific provisions the Court of First Instance of Manila where she had an estate since it was alleged and
must prevail over general ones. proven that Adoracion at the time of her death was a citizen and permanent resident
of Pennsylvania, United States of America and not a "usual resident of Cavite" as
xxx xxx xxx alleged by the petitioner. Moreover, petitioner is now estopped from questioning the
jurisdiction of the probate court in the petition for relief. It is a settled rule that a party
The parties admit that the decedent, Amos G. Bellis, was a citizen of the State of cannot invoke the jurisdiction of a court to secure affirmative relief, against his
Texas, U.S.A., and under the law of Texas, there are no forced heirs or legitimes. opponent and after failing to obtain such relief, repudiate or question that same
Accordingly, since the intrinsic validity of the provision of the will and the amount of jurisdiction. (See Saulog Transit, Inc. vs. Hon. Manuel Lazaro, et al., G. R. No. 63
successional rights are to be determined under Texas law, the Philippine Law on 284, April 4, 1984).
legitimes cannot be applied to the testacy of Amos G. Bellis.
WHEREFORE, the petition for certiorari and prohibition is hereby dismissed for lack
As regards the alleged absence of notice of hearing for the petition for relief, the of merit.
records wig bear the fact that what was repeatedly scheduled for hearing on separate
dates until June 19, 1980 was the petitioner's petition for relief and not his motion to SO ORDERED.
vacate the order of January 10, 1979. There is no reason why the petitioner should
have been led to believe otherwise. The court even admonished the petitioner's failing G.R. No. 202039, August 14, 2019
to adduce evidence when his petition for relief was repeatedly set for hearing. There
was no denial of due process. The fact that he requested "for the future setting of the
ANGELITA SIMUNDAC-KEPPEL, PETITIONER, v. GEORG
case for hearing . . ." did not mean that at the next hearing, the motion to vacate
would be heard and given preference in lieu of the petition for relief. Furthermore, KEPPEL, RESPONDENT.
such request should be embodied in a motion and not in a mere notice of hearing.
DECISION
Finally, we find the contention of the petition as to the issue of jurisdiction utterly
devoid of merit. Under Rule 73, Section 1, of the Rules of Court, it is provided that: BERSAMIN, C.J.:
SECTION 1. Where estate of deceased persons settled. — If the decedent is an The courts do not take judicial notice of foreign laws. To have evidentiary weight in a
inhabitant of the Philippines at the time of his death, whether a citizen or an alien, his judicial proceeding, the foreign laws should be alleged and proved like any other
will shall be proved, or letters of administration granted, and his estate settled, in the material fact.
Court of First Instance in the province in which he resided at the time of his death,
and if he is an inhabitant of a foreign country, the Court of First Instance of any This Case
province in which he had estate. The court first taking cognizance of the settlement of
the estate of a decedent, shall exercise jurisdiction to the exclusion of all other courts. By this appeal, the petitioner assails the decision promulgated on September 26, 2011
The jurisdiction assumed by a court, so far as it depends on the place of residence of by the Court of Appeals (CA) that reversed the judgment rendered on June 21, 2006
the decedent, or of the location of his estate, shall not be contested in a suit or by the Regional Trial Court (RTC) in Muntinlupa City in Civil Case No. 96-048.
 Muntinlupa, which she and her first husband, Reynaldo, previously bought together.
Antecedents The rest of Angelita's savings from Germany went into putting up a school with her
other family members and relatives.
As summarized by the CA, the factual antecedents are as follows:
Angelita earned a considerable income from her business ventures, which she shared
In November 1972, petitioner Angelita Simundac Keppel (Angelita) left the with Georg. However, Angelita stopped giving Georg money in 1994 when she
Philippines to work in Germany as a nurse. In the hospital where Angelita worked, discovered that Georg was having extramarital affairs.
she met Reynaldo Macaraig (Reynaldo), also a nurse and fellow Filipino who had
become a naturalized German citizen. They fell in love and got married in Germany Claiming that Georg was beating her up, Angelita and her two children left their
on 12 June 1976. Angelita and Reynaldo's union produced a son. home in March 1996. Being the registered owner of their family home, Angelita sold
the same to her sister. Despite said sale, Georg refused to vacate the house.
After a few years of marriage, Angelita became attracted to another German nurse
and co-employee, Georg Keppel (Georg). Like Angelita, Georg was married to a On 26 March 1996, Angelita filed the instant petition for annulment of marriage on
Filipina nurse, with whom he had two children. Eventually, the attraction between the ground of Georg's alleged psychological incapacity. Georg opposed the petition,
Angelita and Georg developed into an intimate affair. Not long after that, Reynaldo insisting that the court should only issue a decree of legal separation with the
discovered Angelita's infidelity and they separated. consequent division of their properties and determination of Liselotte's custody.
Angelita countered that there were no properties to divide between them because all
In the meantime, in February 1986, Angelita became a naturalized German citizen. the real properties that she acquired in the Philippines belong solely to her as a
Angelita and her son left Germany to go home to the Philippines, where they planned consequence of the agreement for complete separation of property that they
to start over. previously executed in Germany in 1991.

While in the Philippines, Angelita continued communicating with Georg through During trial, Angelita presented evidence of Georg's psychological incapacity through
letters and telephone calls. In July 1987, Georg's wife divorced him, and so Georg felt medical reports and the like, as well as the contract for separation of property. On the
free to come to the Philippines to meet Angelita's family in September 1987. other hand, Georg presented evidence of the properties that they acquired during their
marriage that he thinks should be divided equally between them.
In December 1987, Angelita returned to Germany to file divorce proceedings against
Reynaldo, and she obtained the divorce decree she sought in June 1988. Shortly Judgment of the RTC
thereafter, Angelita and Georg got married in Germany on 30 August 1988. On 21
November 1989, Angelita gave birth in Germany to a daughter, whom they named On June 21, 2006, the RTC rendered judgment declaring the marriage of Angelita and
Liselotte. Georg null and void, to wit:

In 1991, Angelita and Georg entered into an agreement for the complete separation of WHEREFORE, in view of the foregoing, judgment is hereby rendered as follows:
their properties. At that time, Georg resigned from his job. To make matters worse,
Georg was diagnosed with early multiple sclerosis and could not work. Since a) [T]he marriage between spouses ANGELITA SIMUNDAC and GEORG
Angelita's income was barely enough to support them all, they decided to return and KEPPEL which was solemnized on August 30, 1988 in Dulsburg, Germany, is
settle permanently in the Philippines in 1992. hereby declared as null and void in view of the psychological incapacity of
defendant to perform the essential marital obligations;
Angelita bought a lot in Muntinlupa on which they had a house built in 1993. She
also put up a commercial building – which earned rentals – on another lot in
 b) [A]ll the real and personal properties including the businesses subject of the first spouse; that she did not also prove the German law that capacitated her to marry
instant suit is (sic) hereby declared as forming part of the paraphernal property Georg; that in the eyes of the court, therefore, there could be no annulment of the
of petitioner; marriage between Angelita and Georg to speak of because under Philippine law,
Angelita had remained married to Reynaldo; that Angelita's evidence was insufficient
c) [T]he spouses are directed to equally support their minor child Lisselotte to prove that either of the parties herein had been psychologically incapacitated to
Angela Keppel; comply with essential marital obligations inasmuch as anti-social behavior did not
equate to psychological incapacity; and that the properties of the couple exclusively
d) [T]he custody of the minor child is hereby declared as belonging to herein belonged to Angelita because Georg could not own lands in the Philippines.
petitioner, the mother, without prejudice to the visitorial rights accorded by
law to defendant, unless the said minor child chooses her father's custody, Issues
herein defendant.
In this appeal, Angelita posits that the CA erred in not declaring her marriage with
SO ORDERED.4 Georg null and void inasmuch as Georg was suffering from psychological incapacity
that rendered him incapable to fulfill his essential marital obligations as borne out by
The RTC found both of the parties psychologically incapacitated but considered the medical findings; that being then a German citizen, she need not prove the
Georg's incapacity to be more severe on the basis of the clinical finding that he had dissolution of her marriage with Reynaldo, or the validity of her marriage with Georg
manifested an anti-social or psychopathic type of personality that translated to the because Philippine law did not apply in both instances; and that as alleged in her
symptomatic tendency to deceive and injure Angelita. The RTC declared that as to petition she had recently re-acquired her Filipino citizenship.
the properties of the parties to be distributed after the dissolution of the marriage, the
business and personal properties should be allocated to Angelita pursuant to the Georg counters that the evidence presented was not sufficient basis to conclude that
"Matrimony Property Agreement;" and that the lands should exclusively belong to he was psychologically incapacitated to perform his essential marital obligations; and
Angelita inasmuch as Georg, being a German citizen, was absolutely prohibited from that the prohibition against land ownership by aliens did not apply because the bulk of
owning lands pursuant to Section 7, Article XVII of the Constitution. the properties of the spouses consisted of personal properties that were not covered by
the Constitutional prohibition.
Decision of the CA
Did the CA err in sustaining the validity of the marriage of the parties? Are the lower
On September 26, 2011, the CA promulgated its decision on appeal, reversing the courts correct in awarding all the properties of the spouses in favor of Angelita?
RTC's findings, and thereby dismissing the complaint, disposing thusly:
Ruling of the Court
WHEREFORE, the Decision, dated 21 June 2006, of the Regional Trial Court,
Branch 256, Muntinlupa City in Civil Case No. 96-048 for Annulment of Marriage The appeal fails to impress.
and Custody of Minor Child is REVERSED and SET ASIDE, except for the trial
court's declaration that all properties acquired in the Philippines by Angelita I. Under the Nationality Principle, the petitioner cannot invoke Article 36 of
Simundac Keppel belong to her alone. The complaint is DISMISSED. the Family Code unless there is a German law that allows her to do so

SO ORDERED. A fundamental and obvious defect of Angelita's petition for annulment of marriage is
that it seeks a relief improper under Philippine law in light of both Georg and
The CA observed that Angelita did not prove the allegations in her complaint because Angelita being German citizens, not Filipinos, at the time of the filing thereof. Based
she did not present the original of her divorce decree from Reynaldo Macaraig, her on the Nationality Principle, which is followed in this jurisdiction, and pursuant to
which laws relating to family rights and duties, or to the status, condition and legal might not be available for her. In the absence of a showing of her right to this remedy
capacity of persons are binding upon citizens of the Philippines, even though living in accordance with German law, therefore, the petition should be dismissed.
abroad, it was the pertinent German law that governed. In short, Philippine law finds
no application herein as far as the family rights and obligations of the parties who are II. Assuming the remedy was proper, the petitioner did not prove the
foreign nationals are concerned respondent's psychological incapacity

In Morisono v. Morisono,8 we summarized the treatment of foreign divorce Even if we were now to adhere to the concept of processual presumption, and assume
judgments in this jurisdiction, thus: that the German law was similar to the Philippine law as to allow the action under
Article 36 of the Family Code to be brought by one against the other party herein, we
The rules on divorce prevailing in this jurisdiction can be summed up as follows: would still affirm the CA's dismissal of the petition brought under Article 36 of the
first, Philippine laws do not provide for absolute divorce, and hence, the courts cannot Family Code.
grant the same; second, consistent with Articles 15 and 17 of the Civil Code, the
marital bond between two (2) Filipino citizens cannot be dissolved even by an Notable from the RTC's disquisition is the fact that the psychiatrists found that both
absolute divorce obtained abroad; third, an absolute divorce obtained abroad by a parties had suffered from anti-social behavior that became the basis for the trial
couple who are both aliens may be recognized in the Philippines, provided it is court's conclusion that they had been both psychologically incapacitated to perform
consistent with their respective national laws; and fourth, in mixed marriages the essential martial obligations. Therein lay the reason why we must affirm the CA.
involving a Filipino and a foreigner, the former is allowed to contract a subsequent
marriage in case the absolute divorce is validly obtained abroad by the alien spouse Jurisprudentially speaking, psychological incapacity under Article 36 of the Family
capacitating him or her to remarry. [Bold underscoring supplied for emphasis] Code contemplates an incapacity or inability to take cognizance of and to assume
basic marital obligations, and is not merely the difficulty, refusal, or neglect in the
Accordingly, the petition for annulment initiated by Angelita fails scrutiny through performance of marital obligations or ill will. The disorder consists of: (a) a true
the lens of the Nationality Principle. inability to commit oneself to the essentials of marriage; (b) the inability must refer to
the essential obligations of marriage, that is, the conjugal act, the community of life
Firstly, what governs the marriage of the parties is German, not Philippine, law, and and love, the rendering of mutual help, and the procreation and education of
this rendered it incumbent upon Angelita to allege and prove the applicable German offspring; and (c) the inability must be tantamount to a psychological abnormality.
law. We reiterate that our courts do not take judicial notice of foreign laws; hence, the Proving that a spouse did not meet his or her responsibility and duty as a married
existence and contents of such laws are regarded as questions of fact, and, as such, person is not enough; it is essential that he or she must be shown to be incapable of
must be alleged and proved like any other disputed fact. Proof of the relevant German doing so because of some psychological illness.
law may consist of any of the following, namely: (1) official publications of the law;
or (2) copy attested to by the officer having legal custody of the foreign law. If the Psychological incapacity is unlike any other disorder that would invalidate a
official record is not kept in the Philippines, the copy must be (a) accompanied by a marriage. It should refer to a mental incapacity that causes a party to be incognitive of
certificate issued by the proper diplomatic or consular officer in the Philippine foreign the basic marital covenants such as those enumerated in Article 68 of the Family
service stationed in the foreign country in which the record is kept; and (b) Code and must be characterized by gravity, juridical antecedence and incurability.
authenticated by the seal of his office. Angelita did not comply with the requirements
for pleading and proof of the relevant German law. In Republic v. Court of Appeals,14 the Court issued the following guidelines for the
interpretation and application of Article 36 of the Family Code, to wit:
And, secondly, Angelita overlooked that German and Philippine laws on annulment
of marriage might not be the same. In other words, the remedy of annulment of the (1) The burden of proof to show the nullity of the marriage belongs to the plaintiff.
marriage due to psychological incapacity afforded by Article 36 of the Family Code Any doubt should be resolved in favor of the existence and continuation of the
marriage and against its dissolution and nullity. This is rooted in the fact that both our (5) Such illness must be grave enough to bring about the disability of the party to
Constitution and our laws cherish the validity of marriage and unity of the family. assume the essential obligations of marriage. Thus, "mild characterological
Thus, our Constitution devotes an entire Article on the Family, recognizing it "as the peculiarities, mood changes, occasional emotional outbursts" cannot be accepted as
foundation of the nation." It decrees marriage as legally "inviolable," thereby root causes. The illness must be shown as downright incapacity or inability, not a
protecting it from dissolution at the whim of the parties. Both the family and marriage refusal, neglect or difficulty, much less ill will. In other words, there is a natal or
are to be "protected" by the state. supervening disabling factor in the person, an adverse integral element in the
personality structure that effectively incapacitates the person from really accepting
The Family Code echoes this constitutional edict on marriage and the family and and thereby complying with the obligations essential to marriage.
emphasizes their permanence, inviolability and solidarity.
(6) The essential marital obligations must be those embraced by Articles 68 up to 71
(2) The root cause of the psychological incapacity must be (a) medically or clinically of the Family Code as regards the husband and wife as well as Articles 220, 221 and
identified, (b) alleged in the complaint, (c) sufficiently proven by experts and (d) 225 of the same Code in regard to parents and their children. Such non-complied
clearly explained in the decision. Article 36 of the Family Code requires that the marital obligation(s) must also be stated in the petition, proven by evidence and
incapacity must be psychological — not physical, although its manifestations and/or included in the text of the decision.
symptoms may be physical. The evidence must convince the court that the parties, or
one of them, was mentally or psychically ill to such an extent that the person could Here, however, the petitioner presented no evidence to show that the anti-social
not have known the obligations he was assuming, or knowing them, could not have behavior manifested by both parties had been grave, and had existed at the time of the
given valid assumption thereof. Although no example of such incapacity need be celebration of the marriage as to render the parties incapable of performing all the
given here so as not to limit the application of the provision under the principle of essential marital obligations provided by law. As the records bear out, the medical
ejusdem generis, nevertheless such root cause must be identified as a psychological experts merely concluded that the behavior was grave enough as to incapacitate the
illness and its incapacitating nature fully explained. Expert evidence may be given by parties from the performance of their essential marital relationship because the parties
qualified psychiatrists and clinical psychologists. exhibited symptoms of an anti-social personality disorder. Also, the incapacity was
not established to have existed at the time of the celebration of the marriage. In short,
(3) The incapacity must be proven to be existing at "the time of the celebration" of the the conclusion about the parties being psychologically incapacitated was not founded
marriage. The evidence must show that the illness was existing when the parties on sufficient evidence.
exchanged their "I do's." The manifestation of the illness need not be perceivable at
such time, but the illness itself must have attached at such moment, or prior thereto. III. Former Filipinos have the limited right to own public agricultural lands in
the Philippines
(4) Such incapacity must also be shown to be medically or clinically permanent or
incurable. Such incurability may be absolute or even relative only in regard to the We next deal with the ownership of lands by aliens.
other spouse, not necessarily absolutely against everyone of the same sex.
Furthermore, such incapacity must be relevant to the assumption of marriage Properties accumulated by a married couple may either be real or personal. While the
obligations, not necessarily to those not related to marriage, like the exercise of a RTC awarded herein all personal properties in favor of Angelita pursuant to the
profession or employment in a job. Hence, a pediatrician may be effective in "Matrimonial Property Agreement" executed in Germany, it ignored that such
diagnosing illnesses of children and prescribing medicine to cure them but may not be agreement was governed by the national law of the contracting parties; and that the
psychologically capacitated to procreate, bear and raise his/her own children as an forms and solemnities of contracts, wills, and other public instruments should be
essential obligation of marriage. governed by the laws of the country in which they are executed.
Angelita did not allege and prove the German law that allowed her to enter into and
adopt the regime of complete separation of property through the "Matrimonial Sec. 10. Other Rights of Natural Born Citizen Pursuant to the Provisions of Article
Property Agreement." In the absence of such allegation and proof, the German law XII, Section 8 of the Constitution. — Any natural born citizen who has lost his
was presumed to be the same as that of the Philippines. Philippine citizenship and who has the legal capacity to enter into a contract under
Philippine laws may be a transferee of a private land up to a maximum area of five
In this connection, we further point out Article 77 of the Family Code declares that thousand (5,000) square meters in the case of urban land or three (3) hectares in the
marriage settlements and any modification thereof shall be made in writing and case of rural land to be used by him for business or other purposes. In the case of
signed by the parties prior to the celebration of the marriage. Assuming that the married couples, one of them may avail of the privilege herein granted: Provided,
relevant German law was similar to the Philippine law, the "Matrimonial Property That if both shall avail of the same, the total area acquired shall not exceed the
Agreement," being entered into by the parties in 1991, or a few years after the maximum herein fixed.
celebration of their marriage on August 30, 1988, could not be enforced for being in
contravention of a mandatory law. In case the transferee already owns urban or rural land for business or other purposes,
he shall still be entitled to be a transferee of additional urban or rural land for business
Also, with the parties being married on August 30, 1988, the provisions of the Family or other purposes which when added to those already owned by him shall not exceed
Code should govern. Pursuant to Article 75 of the Family Code, the property relations the maximum areas herein authorized.
between the spouses were governed by the absolute community of property. This
would then entitle Georg to half of the personal properties of the community property. A transferee under this Act may acquire not more than two (2) lots which should be
situated in different municipalities or cities anywhere in the Philippines: Provided,
As to the real properties of the parties, several factual considerations were apparently That the total land area thereof shall not exceed five thousand (5,000) square meters
overlooked, or were not established. in the case of urban land or three (3) hectares in the case of rural land for use by him
for business or other purposes. A transferee who has already acquired urban land shall
Section 7, Article XII of the 1987 Constitution states that: "Save in cases of be disqualified from acquiring rural land area and vice versa.
hereditary succession, no private lands shall be transferred or conveyed except to
individuals, corporations, or associations qualified to acquire or hold lands of the As the foregoing indicates, Angelita did not have any unlimited right to own lands.
public domain." It seems clear, however, that the lower courts were too quick to On the other hand, the records were not clear on whether or not she had owned real
pronounce that Georg, being a German citizen, was automatically disqualified from property as allowed by law. It was imperative for the lower courts to determine so.
owning lands in the Philippines. Without disputing the inherent validity of the Hence, remand for further proceedings is called for.
pronouncement, we nonetheless opine that the lower courts missed to take note of the
fact that Angelita, in view of her having admitted that she herself had been a German It is true that Angelita stated in her petition that she had meanwhile re-acquired
citizen, suffered the same disqualification as Georg. Consequently, the lower courts' Filipino citizenship. This statement remained unsubstantiated, but the impact thereof
pronouncement awarding all real properties in favor of Angelita could be devoid of would be far reaching if the statement was true, for there would then be no need to
legal basis as to her. determine whether or not Angelita had complied with Section 5 of R.A. No. 8179.
Thus, the remand of the case will enable the parties to adduce evidence on this aspect
At best, an alien could have enjoyed a limited right to own lands. Section 8, Article of the case, particularly to provide factual basis to determine whether or not Angelita
XII of the Constitution provides: "Notwithstanding the provisions of Section 7 of this had validly re-acquired her Filipino citizenship; and, if she had, to ascertain what
Article, a natural-born citizen of the Philippines who has lost his Philippine would be the extent of her ownership of the real assets pertaining to the marriage. If
citizenship may be a transferee of private lands, subject to limitations provided by the remand should establish that she had remained a foreigner, it must next be
law." Section 5 of Republic Act No. 8179 (An Act Amending the Foreign determined whether or not she complied with the limits defined or set by R.A. No.
Investments Act of 1991) also states: 8179 regarding her land ownership. The trial court shall award her the real property
that complied with the limits of the law, and inform the Office of the Solicitor
General for purposes of a proper disposition of any excess land whose ownership At the meeting, Soneja informed Suzuki that Unit No. 536 [covered by Condominium
violated the law. Certificate of Title (CCT) No. 18186] and Parking Slot No. 42 [covered by CCT No.
9118] were for sale for ₱3,000,000.00. Soneja likewise assured Suzuki that the titles
WHEREFORE, the Court DENIES the petition for review on certiorari; AFFIRMS to the unit and the parking slot were clean. After a brief negotiation, the parties
the decision promulgated on September 26, 2011 by the Court of Appeals in CA-G.R. agreed to reduce the price to ₱2,800,000.00. On August 5, 2003, Suzuki issued Kang
CV No. 89297 subject to the MODIFICATION that the personal properties of the a Bank of the Philippine Island (BPI) Check No. 833496 for One Hundred Thousand
parties are to be equally divided between them; and REMANDS the case to the court Pesos (₱100,000.00) as reservation fee. On August 21, 2003, Suzuki issued Kang
of origin for the determination of the issues deriving from the petitioner's re- another check, BPI Check No. 83350, this time for ₱2,700,000.00 representing the
acquisition of her Filipino citizenship as far as the ownership of the land pertaining to remaining balance of the purchase price. Suzuki and Kang then executed a Deed of
the parties is concerned consistent with this decision. Absolute Sale dated August 26, 2003 covering Unit No. 536 and Parking Slot No. 42.
Soon after, Suzuki took possession of the condominium unit and parking lot, and
No pronouncement on costs of suit. commenced the renovation of the interior of the condominium unit.

SO ORDERED. Kang thereafter made several representations with Suzuki to deliver the titles to the
properties, which were then allegedly in possession of Alexander Perez (Perez,
G.R. No. 205487 November 12, 2014 Orion’s Loans Officer) for safekeeping. Despite several verbal demands, Kang failed
to deliver the documents. Suzuki later on learned that Kang had left the country,
prompting Suzuki to verify the status of the properties with the Mandaluyong City
ORION SAVINGS BANK, Petitioner,
Registry of Deeds.
vs.
SHIGEKANE SUZUKI, Respondent. Before long, Suzuki learned that CCT No. 9118 representing the title to the Parking
Slot No. 42 contained no annotations although it remained under the name of
DECISION Cityland Pioneer. This notwithstanding, Cityland Pioneer, through Assistant Vice
President Rosario D. Perez, certified that Kang had fully paid the purchase price of
BRION, J.: Unit. No. 53610 and Parking Slot No. 42. CCT No. 18186 representing the title to the
condominium unit had no existing encumbrance, except for an annotation under Entry
Before us is the Petition for Review on Certiorari filed by petitioner Orion Savings No. 73321/C-10186 which provided that any conveyance or encumbrance of CCT
Bank (Orion) under Rule 45 of the Rules of Court, assailing the decision dated No. 18186 shall be subject to approval by the Philippine Retirement Authority (PRA).
August 23, 2012 and the resolution dated January 25, 2013 of the Court of Appeals Although CCT No. 18186 contained Entry No. 66432/C-10186 dated February 2,
(CA) in CA-G.R. CV No. 94104. 1999 representing a mortgage in favor of Orion for a ₱1,000,000.00 loan, that
annotation was subsequently cancelled on June 16, 2000 by Entry No. 73232/T. No.
The Factual Antecedents 10186. Despite the cancellation of the mortgage to Orion, the titles to the properties
remained in possession of Perez.
In the first week of August 2003, respondent Shigekane Suzuki (Suzuki), a Japanese
national, met with Ms. Helen Soneja (Soneja) to inquire about a condominium unit To protect his interests, Suzuki then executed an Affidavit of Adverse Claim dated
and a parking slot at Cityland Pioneer, Mandaluyong City, allegedly owned by Yung September 8, 2003, with the Registry of Deeds of Mandaluyong City, annotated as
Sam Kang (Kang), a Korean national and a Special Resident Retiree's Visa (SRRV) Entry No. 3292/C-No. 18186 in CCT No. 18186. Suzuki then demanded the delivery
holder.
of the titles. Orion, (through Perez), however, refused to surrender the titles, and cited In its decision dated June 29, 2009, the Regional Trial Court (RTC), Branch 213,
the need to consult Orion’s legal counsel as its reason. Mandaluyong City ruled in favor of Suzuki and ordered Orion to deliver the CCT
Nos. 18186 and 9118 to Suzuki.
On October 14, 2003, Suzuki received a letter from Orion’s counsel dated October 9,
2003, stating that Kang obtained another loan in the amount of ₱1,800,000.00. When The court found that Suzuki was an innocent purchaser for value whose rights over
Kang failed to pay, he executed a Dacion en Pago dated February 2, 2003, in favor of the properties prevailed over Orion’s. The RTC further noted that Suzuki exerted
Orion covering Unit No. 536. Orion, however, did not register the Dacion en Pago, efforts to verify the status of the properties but he did not find any existing
until October 15, 2003. encumbrance in the titles. Although Orion claims to have purchased the property by
way of a Dacion en Pago, Suzuki only learned about it two (2) months after he bought
On October 28, 2003, Suzuki executed an Affidavit of Adverse Claim over Parking the properties because Orion never bothered to register or annotate the Dacion en
Slot No. 42 (covered by CCT No. 9118) and this was annotated as Entry No. 4712/C- Pago in CCT Nos. 18186 and 9116.
No. 9118 in the parking lot’s title.
The RTC further ordered Orion and Kang to jointly and severally pay Suzuki moral
On January 27, 2004, Suzuki filed a complaint for specific performance and damages damages, exemplary damages, attorney’s fees, appearance fees, expenses for
against Kang and Orion. At the pre-trial, the parties made the following admissions litigation and cost of suit. Orion timely appealed the RTC decision with the CA.
and stipulations:
The CA Ruling
1. That as of August 26, 2003, Kang was the registered owner of Unit No. 536 and
Parking Slot No. 42; On August 23, 2012, the CA partially granted Orion’s appeal and sustained the RTC
insofar as it upheld Suzuki’s right over the properties. The CA further noted that
2. That the mortgage in favor of Orion supposedly executed by Kang, with Entry No. Entry No. 73321/C-10186 pertaining to the withdrawal of investment of an SRRV
66432/C-10186 dated February 2, 1999, was subsequently cancelled by Entry No. only serves as a warning to an SRRV holder about the implications of a conveyance
73232/T No. 10186 dated June 16, 2000; of a property investment. It deviated from the RTC ruling, however, by deleting the
award for moral damages, exemplary damages, attorney’s fees, expenses for litigation
3. That the alleged Dacion en Pago was never annotated in CCT Nos. 18186 and and cost of suit.
9118;
Orion sought a reconsideration of the CA decision but the CA denied the motion in its
4. That Orion only paid the appropriate capital gains tax and the documentary stamp January 25, 2013 resolution. Orion then filed a petition for review on certiorari under
tax for the alleged Dacion en Pago on October 15, 2003; Rule 45 with this Court.

5. That Parking Slot No. 42, covered by CCT No. 9118, was never mortgaged to The Petition and Comment
Orion; and
Orion’s petition is based on the following grounds/arguments:15
6. That when Suzuki bought the properties, he went to Orion to obtain possession of
the titles. 1. The Deed of Sale executed by Kang in favor of Suzuki is null and void. Under
Korean law, any conveyance of a conjugal property should be made with the consent
The RTC Ruling of both spouses;
2. Suzuki is not a buyer in good faith for he failed to check the owner’s duplicate
copies of the CCTs; Having said these, we shall nonetheless discuss the issues Orion belatedly raised, if
only to put an end to lingering doubts on the correctness of the denial of the present
3. Knowledge of the PRA restriction under Entry No. 73321/C-10186, which petition.
prohibits any conveyance or encumbrance of the property investment, defeats the
alleged claim of good faith by Suzuki; and It is a universal principle that real or immovable property is exclusively subject to the
laws of the country or state where it is located. The reason is found in the very nature
4. Orion should not be faulted for exercising due diligence. of immovable property — its immobility. Immovables are part of the country and so
closely connected to it that all rights over them have their natural center of gravity
In his Comment, Suzuki asserts that the issue on spousal consent was belatedly raised there.
on appeal. Moreover, proof of acquisition during the marital coverture is a condition
sine qua non for the operation of the presumption of conjugal ownership. Suzuki Thus, all matters concerning the title and disposition of real property are determined
additionally maintains that he is a purchaser in good faith, and is thus entitled to the by what is known as the lex loci rei sitae, which can alone prescribe the mode by
protection of the law. which a title can pass from one person to another, or by which an interest therein can
be gained or lost. This general principle includes all rules governing the descent,
The Court’s Ruling alienation and transfer of immovable property and the validity, effect and
construction of wills and other conveyances.
We deny the petition for lack of merit.
This principle even governs the capacity of the person making a deed relating to
The Court may inquire into conclusions of fact when the inference made is manifestly immovable property, no matter what its nature may be. Thus, an instrument will be
mistaken ineffective to transfer title to land if the person making it is incapacitated by the lex
loci rei sitae, even though under the law of his domicile and by the law of the place
In a Rule 45 petition, the latitude of judicial review generally excludes a factual and where the instrument is actually made, his capacity is undoubted.
evidentiary re-evaluation, and the Court ordinarily abides by the uniform factual
conclusions of the trial court and the appellate court. In the present case, while the On the other hand, property relations between spouses are governed principally by the
courts below both arrived at the same conclusion, there appears to be an incongruence national law of the spouses. However, the party invoking the application of a foreign
in their factual findings and the legal principle they applied to the attendant factual law has the burden of proving the foreign law. The foreign law is a question of fact to
circumstances. Thus, we are compelled to examine certain factual issues in the be properly pleaded and proved as the judge cannot take judicial notice of a foreign
exercise of our sound discretion to correct any mistaken inference that may have been law. He is presumed to know only domestic or the law of the forum.
made.
To prove a foreign law, the party invoking it must present a copy thereof and comply
Philippine Law governs the transfer of real property with Sections 24 and 25 of Rule 132 of the Revised Rules of Court which reads:

Orion believes that the CA erred in not ruling on the issue of spousal consent. We SEC. 24. Proof of official record. — The record of public documents referred to in
cannot uphold this position, however, because the issue of spousal consent was only paragraph (a) of Section 19, when admissible for any purpose, may be evidenced by
raised on appeal to the CA. It is a well-settled principle that points of law, theories, an official publication thereof or by a copy attested by the officer having the legal
issues, and arguments not brought to the attention of the trial court cannot be raised custody of the record, or by his deputy, and accompanied, if the record is not kept in
for the first time on appeal and considered by a reviewing court. To consider these the Philippines, with a certificate that such officer has the custody. If the office in
belated arguments would violate basic principles of fair play, justice, and due process. which the record is kept is in a foreign country, the certificate may be made by a
secretary of the embassy or legation, consul general, consul, vice consul, or consular invalid Kang’s conveyance in favor of Suzuki for the supposed lack of spousal
agent or by any officer in the foreign service of the Philippines stationed in the consent.
foreign country in which the record is kept, and authenticated by the seal of his office.
(Emphasis supplied) The petitioner failed to adduce sufficient evidence to prove the due execution of the
Dacion en Pago
SEC. 25. What attestation of copy must state. — Whenever a copy of a document or
record is attested for the purpose of the evidence, the attestation must state, in Article 1544 of the New Civil Code of the Philippines provides that:
substance, that the copy is a correct copy of the original, or a specific part thereof, as
the case may be. The attestation must be under the official seal of the attesting officer, ART. 1544. If the same thing should have been sold to different vendees, the
if there be any, or if he be the clerk of a court having a seal, under the seal of such ownership shall be transferred to the person who may have first taken possession
court. thereof in good faith, if it should be movable property.

Accordingly, matters concerning the title and disposition of real property shall be Should it be immovable property, the ownership shall belong to the person acquiring
governed by Philippine law while issues pertaining to the conjugal nature of the it who in good faith first recorded it in the Registry of Property.
property shall be governed by South Korean law, provided it is proven as a fact.
Should there be no inscription, the ownership shall pertain to the person who in good
In the present case, Orion, unfortunately failed to prove the South Korean law on the faith was first in the possession; and, in the absence thereof, to the person who
conjugal ownership of property. It merely attached a "Certification from the Embassy presents the oldest title, provided there is good faith.
of the Republic of Korea" to prove the existence of Korean Law. This certification,
does not qualify as sufficient proof of the conjugal nature of the property for there is The application of Article 1544 of the New Civil Code presupposes the existence of
no showing that it was properly authenticated by the seal of his office, as required two or more duly executed contracts of sale. In the present case, the Deed of Sale
under Section 24 of Rule 132. dated August 26, 200335 between Suzuki and Kang was admitted by Orion and was
properly identified by Suzuki’s witness Ms. Mary Jane Samin (Samin).
Accordingly, the International Law doctrine of presumed-identity approach or
processual presumption comes into play, i.e., where a foreign law is not pleaded or, It is not disputed, too, that the Deed of Sale dated August 26, 2003 was
even if pleaded, is not proven, the presumption is that foreign law is the same as consummated. In a contract of sale, the seller obligates himself to transfer the
Philippine Law. ownership of the determinate thing sold, and to deliver the same to the buyer, who
obligates himself to pay a price certain to the seller. The execution of the notarized
Under Philippine Law, the phrase "Yung Sam Kang ‘married to' Hyun Sook Jung" is deed of sale and the actual transfer of possession amounted to delivery that produced
merely descriptive of the civil status of Kang. In other words, the import from the the legal effect of transferring ownership to Suzuki.
certificates of title is that Kang is the owner of the properties as they are registered in
his name alone, and that he is married to Hyun Sook Jung. On the other hand, although Orion claims priority in right under the principle of prius
tempore, potior jure (i.e., first in time, stronger in right), it failed to prove the
We are not unmindful that in numerous cases we have held that registration of the existence and due execution of the Dacion en Pago in its favor.
property in the name of only one spouse does not negate the possibility of it being
conjugal or community property. In those cases, however, there was proof that the At the outset, Orion offered the Dacion en Pago as Exhibit "5"with sub markings "5-
properties, though registered in the name of only one spouse, were indeed either a" to "5-c" to prove the existence of the February 6, 2003 transaction in its Formal
conjugal or community properties. Accordingly, we see no reason to declare as Offer dated July 20, 2008. Orion likewise offered in evidence the supposed
promissory note dated September 4, 2002 as Exhibit "12"to prove the existence of the
additional ₱800,000.00 loan. The RTC, however, denied the admission of Exhibits payments because the wordings of the promissory note provide that "[t]he principal of
"5" and "12,"among others, in its order dated August 19, 2008 "since the same [were] this loan and its interest and other charges shall be paid by me/us in accordance
not identified in court by any witness." hereunder: SINGLE PAYMENT LOANS. "There was thus no due and demandable
loan obligation when the alleged Dacion en Pago was executed.
Despite the exclusion of its most critical documentary evidence, Orion failed to make
a tender of excluded evidence, as provided under Section 40, Rule 132 of the Rules of Second, Perez, the supposed person who prepared the Dacion en Pago, appears to
Court. For this reason alone, we are prevented from seriously considering Exhibit "5" only have a vague idea of the transaction he supposedly prepared. During his cross-
and its submarkings and Exhibit "12" in the present petition. examination, he testified:

Moreover, even if we consider Exhibit "5" and its submarkings and Exhibit "12" in ATTY. DE CASTRO:
the present petition, the copious inconsistencies and contradictions in the testimonial
and documentary evidence of Orion, militate against the conclusion that the Dacion Q: And were you the one who prepared this [dacion en pago] Mr. witness?
en Pago was duly executed. First, there appears to be no due and demandable
obligation when the Dacion en Pago was executed, contrary to the allegations of A: Yes, sir. I personally prepared this.
Orion. Orion’s witness Perez tried to impress upon the RTC that Kang was in default
in his ₱1,800,000.00 loan. During his direct examination, he stated: Q: So this 1.8 million pesos is already inclusive of all the penalties, interest and
surcharge due from Mr. Yung Sam Kang?
ATTY. CRUZAT:
A: It’s just the principal, sir.
Q: Okay, so this loan of ₱1.8 million, what happened to this loan, Mr. Witness?
Q: So you did not state the interest [and] penalties?
A: Well it became past due, there has been delayed interest payment by Mr. Kang
and... A: In the [dacion en pago], we do not include interest, sir. We may actually include
that but....
Q: So what did you do after there were defaults[?]
Q: Can you read the Second Whereas Clause, Mr. Witness?
A: We have to secure the money or the investment of the bank through loans and we
have executed a dacion en pago because Mr. Kang said he has no money. So we just A: Whereas the first party failed to pay the said loan to the second party and as of
execute[d] the dacion en pago rather than going through the Foreclosure proceedings. February 10, 2003, the outstanding obligation which is due and demandable principal
and interest and other charges included amounts to ₱1,800,000.00 pesos, sir.
Q: Can you tell the court when was this executed?
Q: You are now changing your answer[.] [I]t now includes interest and other charges,
A: February 6, 2003, your Honor. based on this document?

A reading of the supposed promissory note, however, shows that there was no default A: Yes, based on that document, sir.
to speak of when the supposed Dacion en Pago was executed.
Third, the Dacion en Pago, mentioned that the ₱1,800,000.00 loan was secured by a
Based on the promissory note, Kang’s loan obligation would mature only on August real estate mortgage. However, no document was ever presented to prove this real
27, 2003. Neither can Orion claim that Kang had been in default in his installment estate mortgage aside from it being mentioned in the Dacion en Pago itself.
 A: None sir.
ATTY. DE CASTRO:
Q: No payments?
Q: Would you know if there is any other document like a supplement to that Credit
Line Agreement referring to this 1.8 million peso loan by Mr. Yung Sam Kang which A: None sir.
says that there was a subsequent collateralization or security given by Mr. Yung
[Sam] Q: And from 1999 to 2002, there was no payment, either by way of payment to the
principal, by way of payment of interest, there was no payment by Mr. Yung Sam
Kang for the loan? Kang of this loan?

A: The [dacion en pago], sir. A: Literally, there was no actual cash movement, sir.

Fourth, the Dacion en Pago was first mentioned only two (2) months after Suzuki and Q: There was no actual cash?
Samin demanded the delivery of the titles sometime in August 2003, and after Suzuki
caused the annotation of his affidavit of adverse claim. Records show that it was only A: Yes, sir.
on October 9, 2003, when Orion, through its counsel, Cristobal Balbin Mapile &
Associates first spoke of the Dacion en Pago. Not even Perez mentioned any Dacion Q: And yet despite no payment, the bank Orion Savings Bank still extended an
en Pago on October 1, 2003, when he personally received a letter demanding the ₱800,000.00 additional right?
delivery of the titles. Instead, Perez refused to accept the letter and opted to first
consult with his lawyer. A: Yes, sir.

Notably, even the October 9, 2003 letter contained material inconsistencies in its Fifth, it is undisputed that notwithstanding the supposed execution of the Dacion en
recital of facts surrounding the execution of the Dacion en Pago. In particular, it Pago on February 2, 2003, Kang remained in possession of the condominium unit. In
mentioned that "on [September 4, 2002], after paying the original loan, [Kang] fact, nothing in the records shows that Orion even bothered to take possession of the
applied and was granted a new Credit Line Facility by [Orion] for ONE MILLION property even six (6) months after the supposed date of execution of the Dacion en
EIGHT HUNDRED THOUSAND PESOS (₱1,800,000.00)." Perez, however, Pago. Kang was even able to transfer possession of the condominium unit to Suzuki,
testified that there was "no cash movement" in the original ₱1,000,000.00 loan. In his who then made immediate improvements thereon. If Orion really purchased the
testimony, he said: condominium unit on February 2, 2003 and claimed to be its true owner, why did it
not assert its ownership immediately after the alleged sale took place? Why did it
COURT: have to assert its ownership only after Suzuki demanded the delivery of the titles?
These gaps have remained unanswered and unfilled.
Q: Would you remember what was the subject matter of that real estate mortgage for
that first ₱1,000,000.00 loan? In Suntay v. CA,48 we held that the most prominent index of simulation is the
complete absence of an attempt on the part of the vendee to assert his rights of
A: It’s a condominium Unit in Cityland, sir. ownership over the property in question. After the sale, the vendee should have
entered the land and occupied the premises. The absence of any attempt on the part of
Q: Would you recall if there was any payment by Mr. Yung Sam Kang of this Orion to assert its right of dominion over the property allegedly sold to it is a clear
₱1,000,000.00 loan? badge of fraud. That notwithstanding the execution of the Dacion en Pago, Kang
remained in possession of the disputed condominium unit – from the time of the
execution of the Dacion en Pago until the property’s subsequent transfer to Suzuki – Section 14. Should the retiree-investor withdraw his investment from the Philippines,
unmistakably strengthens the fictitious nature of the Dacion en Pago. or transfer the same to another domestic enterprise, or sell, convey or transfer his
condominium unit or units to another person, natural or juridical without the prior
These circumstances, aside from the glaring inconsistencies in the documents and approval of the Authority, the Special Resident Retiree’s Visa issued to him, and/or
testimony of Orion’s witness, indubitably prove the spurious nature of the Dacion en unmarried minor child or children[,] may be cancelled or revoked by the Philippine
Pago. Government, through the appropriate government department or agency, upon
recommendation of the Authority.
The fact that the Dacion en Pago is a notarized document does not support the
conclusion that the sale it embodies is a true conveyance. Moreover, Orion should not be allowed to successfully assail the good faith of Suzuki
on the basis of the PRA restriction. Orion knew of the PRA restriction when it
Public instruments are evidence of the facts that gave rise to their execution and are to transacted with Kang. Incidentally, Orion admitted accommodating Kang’s request to
be considered as containing all the terms of the agreement. While a notarized cancel the mortgage annotation despite the lack of payment to circumvent the PRA
document enjoys this presumption, "the fact that a deed is notarized is not a guarantee restriction. Orion, thus, is estopped from impugning the validity of the conveyance in
of the validity of its contents." The presumption of regularity of notarized documents favor of Suzuki on the basis of the PRA restriction that Orion itself ignored and
is not absolute and may be rebutted by clear and convincing evidence to the contrary. "attempted" to circumvent.

In the present case, the presumption cannot apply because the regularity in the With the conclusion that Orion failed to prove the authenticity of the Dacion en Pago,
execution of the Dacion en Pago and the loan documents was challenged in the we see no reason for the application of the rules on double sale under Article 1544 of
proceedings below where their prima facie validity was overthrown by the highly the New Civil Code. Suzuki, moreover, successfully adduced sufficient evidence to
questionable circumstances surrounding their execution. establish the validity of conveyance in his favor.

Effect of the PRA restriction on the validity of Suzuki’s title to the property WHEREFORE, premises considered, we DENY the petition for lack of merit. Costs
against petitioner Orion Savings Bank.
Orion argues that the PRA restriction in CCT No. 18186 affects the conveyance to
Suzuki. In particular, Orion assails the status of Suzuki as a purchaser in good faith in SO ORDERED.
view of the express PRA restriction contained in CCT No. 18186.53

We reject this suggested approach outright because, to our mind, the PRA restriction
ARTICLE 19
cannot affect the conveyance in favor of Suzuki. On this particular point, we concur
with the following findings of the CA: G.R. No. 157314 July 29, 2005

the annotation merely serves as a warning to the owner who holds a Special Resident FAR EAST BANK AND TRUST COMPANY, NOW BANK OF THE
Retiree’s Visa(SRRV) that he shall lose his visa if he disposes his property which PHILIPPINE ISLANDS, Petitioners,
serves as his investment in order to qualify for such status. Section 14 of the vs.
Implementing Investment Guidelines under Rule VIII-A of the Rules and Regulations THEMISTOCLES PACILAN, JR., Respondent.
Implementing Executive Order No. 1037, Creating the Philippine Retirement Park
System Providing Funds Therefor and For Other Purpose (otherwise known as the DECISION
Philippine Retirement Authority) states:
CALLEJO, SR., J.:
Before the Court is the petition for review on certiorari filed by Far East Bank and On April 18, 1988, the respondent wrote to petitioner bank complaining that the
Trust Company (now Bank of the Philippines Islands) seeking the reversal of the closure of his account was unjustified. When he did not receive a reply from
Decision dated August 30, 2002 of the Court of Appeals (CA) in CA-G.R. CV No. petitioner bank, the respondent filed with the RTC of Negros Occidental, Bacolod
36627 which ordered it, together with its branch accountant, Roger Villadelgado, to City, Branch 54, a complaint for damages against petitioner bank and Villadelgado.
pay respondent Themistocles Pacilan, Jr. the total sum of ₱100,000.00 as moral and The case was docketed as Civil Case No. 4908. The respondent, as complainant
exemplary damages. The assailed decision affirmed with modification that of the therein, alleged that the closure of his current account by petitioner bank was
Regional Trial Court (RTC) of Negros Occidental, Bacolod City, Branch 54, in Civil unjustified because on the first banking hour of April 5, 1988, he already deposited an
Case No. 4908. Likewise sought to be reversed and set aside is the Resolution dated amount sufficient to fund his checks. The respondent pointed out that Check No.
January 17, 2003 of the appellate court, denying petitioner bank’s motion for 2434886, in particular, was delivered to petitioner bank at the close of banking hours
reconsideration. on April 4, 1988 and, following normal banking procedure, it (petitioner bank) had
until the last clearing hour of the following day, or on April 5, 1988, to honor the
The case stemmed from the following undisputed facts: check or return it, if not funded. In disregard of this banking procedure and practice,
however, petitioner bank hastily closed the respondent’s current account and
Respondent Pacilan opened a current account with petitioner bank’s Bacolod Branch dishonored his Check No. 2434886.
on May 23, 1980. His account was denominated as Current Account No. 53208
(0052-00407-4). The respondent had since then issued several postdated checks to The respondent further alleged that prior to the closure of his current account, he had
different payees drawn against the said account. Sometime in March 1988, the issued several other postdated checks. The petitioner bank’s act of closing his current
respondent issued Check No. 2434886 in the amount of ₱680.00 and the same was account allegedly preempted the deposits that he intended to make to fund those
presented for payment to petitioner bank on April 4, 1988. checks. Further, the petitioner bank’s act exposed him to criminal prosecution for
violation of Batas Pambansa Blg. 22.
Upon its presentment on the said date, Check No. 2434886 was dishonored by
petitioner bank. The next day, or on April 5, 1988, the respondent deposited to his According to the respondent, the indecent haste that attended the closure of his
current account the amount of ₱800.00. The said amount was accepted by petitioner account was patently malicious and intended to embarrass him. He claimed that he is
bank; hence, increasing the balance of the respondent’s deposit to ₱1,051.43. a Cashier of Prudential Bank and Trust Company, whose branch office is located just
across that of petitioner bank, and a prominent and respected leader both in the civic
Subsequently, when the respondent verified with petitioner bank about the dishonor and banking communities. The alleged malicious acts of petitioner bank besmirched
of Check No. 2434866, he discovered that his current account was closed on the the respondent’s reputation and caused him "social humiliation, wounded feelings,
ground that it was "improperly handled." The records of petitioner bank disclosed that insurmountable worries and sleepless nights" entitling him to an award of damages.
between the period of March 30, 1988 and April 5, 1988, the respondent issued four
checks, to wit: Check No. 2480416 for ₱6,000.00; Check No. 2480419 for ₱50.00; In their answer, petitioner bank and Villadelgado maintained that the respondent’s
Check No. 2434880 for ₱680.00 and; Check No. 2434886 for ₱680.00, or a total current account was subject to petitioner bank’s Rules and Regulations Governing the
amount of ₱7,410.00. At the time, however, the respondent’s current account with Establishment and Operation of Regular Demand Deposits which provide that "the
petitioner bank only had a deposit of ₱6,981.43. Thus, the total amount of the checks Bank reserves the right to close an account if the depositor frequently draws checks
presented for payment on April 4, 1988 exceeded the balance of the respondent’s against insufficient funds and/or uncollected deposits" and that "the Bank reserves the
deposit in his account. For this reason, petitioner bank, through its branch accountant, right at any time to return checks of the depositor which are drawn against
Villadelgado, closed the respondent’s current account effective the evening of April insufficient funds or for any reason."
4, 1988 as it then had an overdraft of ₱428.57. As a consequence of the overdraft,
Check No. 2434886 was dishonored.
They showed that the respondent had improperly and irregularly handled his current close the respondent’s account, the manner which attended the closure constituted an
account. For example, in 1986, the respondent’s account was overdrawn 156 times, in abuse of the said right. Citing Article 19 of the Civil Code of the Philippines which
1987, 117 times and in 1988, 26 times. In all these instances, the account was states that "[e]very person must, in the exercise of his rights and in the performance
overdrawn due to the issuance of checks against insufficient funds. The respondent of his duties, act with justice, give everyone his due, and observe honesty and good
had also signed several checks with a different signature from the specimen on file for faith" and Article 20 thereof which states that "[e]very person who, contrary to law,
dubious reasons. willfully or negligently causes damage to another, shall indemnify the latter for the
same," the court a quo adjudged petitioner bank of acting in bad faith. It held that,
When the respondent made the deposit on April 5, 1988, it was obviously to cover for under the foregoing circumstances, the respondent is entitled to an award of moral
issuances made the previous day against an insufficiently funded account. When his and exemplary damages.
Check No. 2434886 was presented for payment on April 4, 1988, he had already
incurred an overdraft; hence, petitioner bank rightfully dishonored the same for The decretal portion of the court a quo’s decision reads:
insufficiency of funds.
WHEREFORE, PREMISES CONSIDERED, judgment is hereby rendered:
After due proceedings, the court a quo rendered judgment in favor of the respondent
as it ordered the petitioner bank and Villadelgado, jointly and severally, to pay the 1. Ordering the defendants [petitioner bank and Villadelgado], jointly and severally,
respondent the amounts of ₱100,000.00 as moral damages and ₱50,000.00 as to pay plaintiff [the respondent] the sum of ₱100,000.00 as moral damages;
exemplary damages and costs of suit. In so ruling, the court a quo also cited petitioner
bank’s rules and regulations which state that "a charge of ₱10.00 shall be levied 2. Ordering the defendants, jointly and severally, to pay plaintiff the sum of
against the depositor for any check that is taken up as a returned item due to ₱50,000.00 as exemplary damages plus costs and expenses of the suit; and
‘insufficiency of funds’ on the date of receipt from the clearing office even if said
check is honored and/or covered by sufficient deposit the following banking day." 3. Dismissing [the] defendants’ counterclaim for lack of merit.
The same rules and regulations also provide that "a check returned for insufficiency
of funds for any reason of similar import may be subsequently recleared for one more SO ORDERED.
time only, subject to the same charges."
On appeal, the CA rendered the Decision dated August 30, 2002, affirming with
According to the court a quo, following these rules and regulations, the respondent, as modification the decision of the court a quo.
depositor, had the right to put up sufficient funds for a check that was taken as a
returned item for insufficient funds the day following the receipt of said check from The appellate court substantially affirmed the factual findings of the court a quo as it
the clearing office. In fact, the said check could still be recleared for one more time. held that petitioner bank unjustifiably closed the respondent’s account
In previous instances, petitioner bank notified the respondent when he incurred an notwithstanding that its own rules and regulations allow that a check returned for
overdraft and he would then deposit sufficient funds the following day to cover the insufficiency of funds or any reason of similar import, may be subsequently recleared
overdraft. Petitioner bank thus acted unjustifiably when it immediately closed the for one more time, subject to standard charges. Like the court a quo, the appellate
respondent’s account on April 4, 1988 and deprived him of the opportunity to reclear court observed that in several instances in previous years, petitioner bank would
his check or deposit sufficient funds therefor the following day. inform the respondent when he incurred an overdraft and allowed him to make a
timely deposit to fund the checks that were initially dishonored for insufficiency of
As a result of the closure of his current account, several of the respondent’s checks funds. However, on April 4, 1988, petitioner bank immediately closed the
were subsequently dishonored and because of this, the respondent was humiliated, respondent’s account without even notifying him that he had incurred an overdraft.
embarrassed and lost his credit standing in the business community. The court a quo Even when they had already closed his account on April 4, 1988, petitioner bank still
further ratiocinated that even granting arguendo that petitioner bank had the right to
accepted the deposit that the respondent made on April 5, 1988, supposedly to cover Petitioner bank sought the reconsideration of the said decision but in the assailed
his checks. Resolution dated January 17, 2003, the appellate court denied its motion. Hence, the
recourse to this Court.
Echoing the reasoning of the court a quo, the CA declared that even as it may be
conceded that petitioner bank had reserved the right to close an account for repeated Petitioner bank maintains that, in closing the account of the respondent in the evening
overdrafts by the respondent, the exercise of that right must never be despotic or of April 4, 1988, it acted in good faith and in accordance with the rules and
arbitrary. That petitioner bank chose to close the account outright and return the regulations governing the operation of a regular demand deposit which reserves to the
check, even after accepting a deposit sufficient to cover the said check, is contrary to bank "the right to close an account if the depositor frequently draws checks against
its duty to handle the respondent’s account with utmost fidelity. The exercise of the insufficient funds and/or uncollected deposits." The same rules and regulations also
right is not absolute and good faith, at least, is required. The manner by which provide that "the depositor is not entitled, as a matter of right, to overdraw on this
petitioner bank closed the account of the respondent runs afoul of Article 19 of the deposit and the bank reserves the right at any time to return checks of the depositor
Civil Code which enjoins every person, in the exercise of his rights, "to give everyone which are drawn against insufficient funds or for any reason."
his due, and observe honesty and good faith."
It cites the numerous instances that the respondent had overdrawn his account and
The CA concluded that petitioner bank’s precipitate and imprudent closure of the those instances where he deliberately signed checks using a signature different from
respondent’s account had caused him, a respected officer of several civic and banking the specimen on file. Based on these facts, petitioner bank was constrained to close
associations, serious anxiety and humiliation. It had, likewise, tainted his credit the respondent’s account for improper and irregular handling and returned his Check
standing. Consequently, the award of damages is warranted. The CA, however, No. 2434886 which was presented to the bank for payment on April 4, 1988.
reduced the amount of damages awarded by the court a quo as it found the same to be
excessive: Petitioner bank further posits that there is no law or rule which gives the respondent a
legal right to make good his check or to deposit the corresponding amount to cover
We, however, find excessive the amount of damages awarded by the RTC. In our said check within 24 hours after the same is dishonored or returned by the bank for
view the reduced amount of ₱75,000.00 as moral damages and ₱25,000.00 as having been drawn against insufficient funds. It vigorously denies having violated
exemplary damages are in order. Awards for damages are not meant to enrich the Article 19 of the Civil Code as it insists that it acted in good faith and in accordance
plaintiff-appellee [the respondent] at the expense of defendants-appellants [the with the pertinent banking rules and regulations.
petitioners], but to obviate the moral suffering he has undergone. The award is aimed
at the restoration, within limits possible, of the status quo ante, and should be The petition is impressed with merit.
proportionate to the suffering inflicted.
A perusal of the respective decisions of the court a quo and the appellate court show
The dispositive portion of the assailed CA decision reads: that the award of damages in the respondent’s favor was anchored mainly on Article
19 of the Civil Code which, quoted anew below, reads:
WHEREFORE, the decision appealed from is hereby AFFIRMED, subject to the
MODIFICATION that the award of moral damages is reduced to ₱75,000.00 and the Art. 19. Every person must, in the exercise of his rights and in the performance of his
award of exemplary damages reduced to ₱25,000.00. duties, act with justice, give everyone his due, and observe honesty and good faith.

SO ORDERED. The elements of abuse of rights are the following: (a) the existence of a legal right
or duty; (b) which is exercised in bad faith; and (c) for the sole intent of
prejudicing or injuring another. Malice or bad faith is at the core of the said
provision. The law always presumes good faith and any person who seeks to be
awarded damages due to acts of another has the burden of proving that the latter
acted in bad faith or with ill-motive. Good faith refers to the state of the mind which It is observed that nowhere under its rules and regulations is petitioner bank required
is manifested by the acts of the individual concerned. It consists of the intention to to notify the respondent, or any depositor for that matter, of the closure of the account
abstain from taking an unconscionable and unscrupulous advantage of another. Bad for frequently drawing checks against insufficient funds. No malice or bad faith could
faith does not simply connote bad judgment or simple negligence, dishonest purpose be imputed on petitioner bank for so acting since the records bear out that the
or some moral obliquity and conscious doing of a wrong, a breach of known duty due respondent had indeed been improperly and irregularly handling his account not just a
to some motives or interest or ill-will that partakes of the nature of fraud. Malice few times but hundreds of times. Under the circumstances, petitioner bank could not
connotes ill-will or spite and speaks not in response to duty. It implies an intention to be faulted for exercising its right in accordance with the express rules and regulations
do ulterior and unjustifiable harm. Malice is bad faith or bad motive. governing the current accounts of its depositors. Upon the opening of his account, the
respondent had agreed to be bound by these terms and conditions.
Undoubtedly, petitioner bank has the right to close the account of the respondent
based on the following provisions of its Rules and Regulations Governing the Neither the fact that petitioner bank accepted the deposit made by the respondent the
Establishment and Operation of Regular Demand Deposits: day following the closure of his account constitutes bad faith or malice on the part of
petitioner bank. The same could be characterized as simple negligence by its
10) The Bank reserves the right to close an account if the depositor frequently draws personnel. Said act, by itself, is not constitutive of bad faith.
checks against insufficient funds and/or uncollected deposits.
… The respondent had thus failed to discharge his burden of proving bad faith on the
part of petitioner bank or that it was motivated by ill-will or spite in closing his
12) … However, it is clearly understood that the depositor is not entitled, as a matter account on April 4, 1988 and in inadvertently accepting his deposit on April 5, 1988.
of right, to overdraw on this deposit and the bank reserves the right at any time to
return checks of the depositor which are drawn against insufficient funds or for any Further, it has not been shown that these acts were done by petitioner bank with the
other reason. sole intention of prejudicing and injuring the respondent. It is conceded that the
respondent may have suffered damages as a result of the closure of his current
The facts, as found by the court a quo and the appellate court, do not establish that, in account. However, there is a material distinction between damages and injury. The
the exercise of this right, petitioner bank committed an abuse thereof. Specifically, Court had the occasion to explain the distinction between damages and injury in this
the second and third elements for abuse of rights are not attendant in the present case. wise:
The evidence presented by petitioner bank negates the existence of bad faith or
malice on its part in closing the respondent’s account on April 4, 1988 because on the … Injury is the illegal invasion of a legal right; damage is the loss, hurt or harm
said date the same was already overdrawn. The respondent issued four checks, all due which results from the injury; and damages are the recompense or compensation
on April 4, 1988, amounting to ₱7,410.00 when the balance of his current account awarded for the damage suffered. Thus, there can be damage without injury in those
deposit was only ₱6,981.43. Thus, he incurred an overdraft of ₱428.57 which resulted instances in which the loss or harm was not the result of a violation of a legal duty. In
in the dishonor of his Check No. 2434886. Further, petitioner bank showed that in such cases, the consequences must be borne by the injured person alone, the law
1986, the current account of the respondent was overdrawn 156 times due to his affords no remedy for damages resulting from an act which does not amount to a
issuance of checks against insufficient funds. In 1987, the said account was legal injury or wrong. These situations are often called damnum absque injuria.
overdrawn 117 times for the same reason. Again, in 1988, 26 times. There were also
several instances when the respondent issued checks deliberately using a signature In other words, in order that a plaintiff may maintain an action for the injuries of
different from his specimen signature on file with petitioner bank. All these which he complains, he must establish that such injuries resulted from a breach of
circumstances taken together justified the petitioner bank’s closure of the duty which the defendant owed to the plaintiff – a concurrence of injury to the
respondent’s account on April 4, 1988 for "improper handling." plaintiff and legal responsibility by the person causing it. The underlying basis for the
award of tort damages is the premise that the individual was injured in contemplation In 1982, respondent Ernesto C. Quiamco was approached by Juan Davalan,
of law. Thus, there must first be a breach of some duty and the imposition of liability Josefino Gabutero and Raul Generoso to amicably settle the civil aspect of a
for that breach before damages may be awarded; and the breach of such duty should criminal case for robbery filed by Quiamco against them. They surrendered to
be the proximate cause of the injury. him a red Honda XL-100 motorcycle and a photocopy of its certificate of
registration. Respondent asked for the original certificate of registration but the
Whatever damages the respondent may have suffered as a consequence, e.g., dishonor three accused never came to see him again. Meanwhile, the motorcycle was parked
of his other insufficiently funded checks, would have to be borne by him alone. It was in an open space inside respondent’s business establishment, Avesco-AVNE
the respondent’s repeated improper and irregular handling of his account which Enterprises, where it was visible and accessible to the public.
constrained petitioner bank to close the same in accordance with the rules and
regulations governing its depositors’ current accounts. The respondent’s case is It turned out that, in October 1981, the motorcycle had been sold on installment
clearly one of damnum absque injuria. basis to Gabutero by petitioner Ramas Uypitching Sons, Inc., a family-owned
corporation managed by petitioner Atty. Ernesto Ramas Uypitching. To secure its
WHEREFORE, the petition is GRANTED. The Decision dated August 30, 2002 and payment, the motorcycle was mortgaged to petitioner corporation.
Resolution dated January 17, 2003 of the Court of Appeals in CA-G.R. CV No.
36627 are REVERSED AND SET ASIDE. When Gabutero could no longer pay the installments, Davalan assumed the
obligation and continued the payments. In September 1982, however, Davalan
SO ORDERED. stopped paying the remaining installments and told petitioner corporation’s
collector, Wilfredo Veraño, that the motorcycle had allegedly been "taken by
G.R. No. 146322 December 6, 2006 respondent’s men."

Nine years later, on January 26, 1991, petitioner Uypitching, accompanied by

ERNESTO RAMAS UYPITCHING and RAMAS UYPITCHING
policemen, went to Avesco-AVNE Enterprises to recover the motorcycle. The leader
SONS, INC., petitioners, of the police team, P/Lt. Arturo Vendiola, talked to the clerk in charge and asked for
vs. respondent. While P/Lt. Vendiola and the clerk were talking, petitioner Uypitching
ERNESTO QUIAMCO, respondent. paced back and forth inside the establishment uttering "Quiamco is a thief of a
motorcycle."

On learning that respondent was not in Avesco-AVNE Enterprises, the policemen left
DECISION
to look for respondent in his residence while petitioner Uypitching stayed in the
establishment to take photographs of the motorcycle. Unable to find respondent, the
policemen went back to Avesco-AVNE Enterprises and, on petitioner Uypitching’s
CORONA, J.: instruction and over the clerk’s objection, took the motorcycle.

Honeste vivere, non alterum laedere et jus suum cuique tribuere. To live virtuously, On February 18, 1991, petitioner Uypitching filed a criminal complaint for
not to injure others and to give everyone his due. These supreme norms of justice are qualified theft and/or violation of the Anti-Fencing Law against respondent in the
the underlying principles of law and order in society. We reaffirm them in this Office of the City Prosecutor of Dumaguete City. Respondent moved for dismissal
petition for review on certiorari assailing the July 26, 2000 decision1 and October 18, because the complaint did not charge an offense as he had neither stolen nor bought
2000 resolution of the Court of Appeals (CA) in CA-G.R. CV No. 47571. the motorcycle. The Office of the City Prosecutor dismissed the complaint and denied
petitioner Uypitching’s subsequent motion for reconsideration.
Respondent filed an action for damages against petitioners in the RTC of Dumaguete Nevertheless, to address petitioners’ concern, we also find that the trial and appellate
City, Negros Oriental, Branch 37. He sought to hold the petitioners liable for the courts correctly ruled that the filing of the complaint was tainted with malice and bad
following: (1) unlawful taking of the motorcycle; (2) utterance of a defamatory faith. Petitioners themselves in fact described their action as a "precipitate act."
remark (that respondent was a thief) and (3) precipitate filing of a baseless and Petitioners were bent on portraying respondent as a thief. In this connection, we quote
malicious complaint. These acts humiliated and embarrassed the respondent and with approval the following findings of the RTC, as adopted by the CA:
injured his reputation and integrity.
x x x There was malice or ill-will [in filing the complaint before the City Prosecutor’s
On July 30, 1994, the trial court rendered a decision finding that petitioner Office] because Atty. Ernesto Ramas Uypitching knew or ought to have known as he
Uypitching was motivated with malice and ill will when he called respondent a thief, is a lawyer, that there was no probable cause at all for filing a criminal complaint for
took the motorcycle in an abusive manner and filed a baseless complaint for qualified qualified theft and fencing activity against [respondent]. Atty. Uypitching had no
theft and/or violation of the Anti-Fencing Law. Petitioners’ acts were found to be personal knowledge that [respondent] stole the motorcycle in question. He was
contrary to Articles 19 and 20 of the Civil Code. Hence, the trial court held merely told by his bill collector ([i.e.] the bill collector of Ramas Uypitching Sons,
petitioners liable to respondent for P500,000 moral damages, P200,000 exemplary Inc.)[,] Wilfredo Veraño[,] that Juan Dabalan will [no longer] pay the remaining
damages and P50,000 attorney’s fees plus costs. installment(s) for the motorcycle because the motorcycle was taken by the men of
[respondent]. It must be noted that the term used by Wilfredo Veraño in informing
Petitioners appealed the RTC decision but the CA affirmed the trial court’s decision Atty. Ernesto Ramas Uypitching of the refusal of Juan Dabalan to pay for the
with modification, reducing the award of moral and exemplary damages to P300,000 remaining installment was [‘]taken[’], not [‘]unlawfully taken[’] or ‘stolen.’ Yet,
and P100,000, respectively. Petitioners sought reconsideration but it was denied. despite the double hearsay, Atty. Ernesto Ramas Uypitching not only executed the
Thus, this petition. [complaint-affidavit] wherein he named [respondent] as ‘the suspect’ of the stolen
motorcycle but also charged [respondent] of ‘qualified theft and fencing activity’
In their petition and memorandum, petitioners submit that the sole (allegedly) issue to before the City [Prosecutor’s] Office of Dumaguete. The absence of probable cause
be resolved here is whether the filing of a complaint for qualified theft and/or necessarily signifies the presence of malice. What is deplorable in all these is that
violation of the Anti-Fencing Law in the Office of the City Prosecutor warranted the Juan Dabalan, the owner of the motorcycle, did not accuse [respondent] or the latter’s
award of moral damages, exemplary damages, attorney’s fees and costs in favor of men of stealing the motorcycle[,] much less bother[ed] to file a case for qualified
respondent. theft before the authorities. That Atty. Uypitching’s act in charging [respondent] with
qualified theft and fencing activity is tainted with malice is also shown by his answer
Petitioners’ suggestion is misleading. They were held liable for damages not only for to the question of Cupid Gonzaga [during one of their conversations] - "why should
instituting a groundless complaint against respondent but also for making a you still file a complaint? You have already recovered the motorcycle…"[:] "Aron
slanderous remark and for taking the motorcycle from respondent’s establishment in motagam ang kawatan ug motor." ("To teach a lesson to the thief of motorcycle.")
an abusive manner.
Moreover, the existence of malice, ill will or bad faith is a factual matter. As a rule,
Correctness of the Findings of the RTC and CA findings of fact of the trial court, when affirmed by the appellate court, are conclusive
on this Court. We see no compelling reason to reverse the findings of the RTC and
As they never questioned the findings of the RTC and CA that malice and ill will the CA.
attended not only the public imputation of a crime to respondent but also the taking of
the motorcycle, petitioners were deemed to have accepted the correctness of such Petitioners Abused Their Right of Recovery as Mortgagee(s)
findings. This alone was sufficient to hold petitioners liable for damages to
respondent.
Petitioners claim that they should not be held liable for petitioner corporation’s
exercise of its right as seller-mortgagee to recover the mortgaged vehicle preliminary In this case, the manner by which the motorcycle was taken at petitioners’ instance
to the enforcement of its right to foreclose on the mortgage in case of default. They was not only attended by bad faith but also contrary to the procedure laid down by
are clearly mistaken. law. Considered in conjunction with the defamatory statement, petitioners’ exercise
of the right to recover the mortgaged vehicle was utterly prejudicial and injurious to
True, a mortgagee may take steps to recover the mortgaged property to enable it to respondent. On the other hand, the precipitate act of filing an unfounded complaint
enforce or protect its foreclosure right thereon. There is, however, a well-defined could not in any way be considered to be in accordance with the purpose for which
procedure for the recovery of possession of mortgaged property: if a mortgagee is the right to prosecute a crime was established. Thus, the totality of petitioners’ actions
unable to obtain possession of a mortgaged property for its sale on foreclosure, he showed a calculated design to embarrass, humiliate and publicly ridicule respondent.
must bring a civil action either to recover such possession as a preliminary step to the Petitioners acted in an excessively harsh fashion to the prejudice of respondent.
sale, or to obtain judicial foreclosure. Contrary to law, petitioners willfully caused damage to respondent. Hence, they
should indemnify him.
Petitioner corporation failed to bring the proper civil action necessary to acquire legal
possession of the motorcycle. Instead, petitioner Uypitching descended on WHEREFORE, the petition is hereby DENIED. The July 26, 2000 decision and
respondent’s establishment with his policemen and ordered the seizure of the October 18, 2000 resolution of the Court of Appeals in CA-G.R. CV No. 47571 are
motorcycle without a search warrant or court order. Worse, in the course of the illegal AFFIRMED.
seizure of the motorcycle, petitioner Uypitching even mouthed a slanderous
statement. Triple costs against petitioners, considering that petitioner Ernesto Ramas Uypitching
is a lawyer and an officer of the court, for his improper behavior.
No doubt, petitioner corporation, acting through its co-petitioner Uypitching,
blatantly disregarded the lawful procedure for the enforcement of its right, to the SO ORDERED.
prejudice of respondent. Petitioners’ acts violated the law as well as public morals,
and transgressed the proper norms of human relations. G.R. No. 160273 January 18, 2008
The basic principle of human relations, embodied in Article 19 of the Civil Code,
CEBU COUNTRY CLUB, INC., SABINO R. DAPAT, RUBEN D.
provides:
ALMENDRAS, JULIUS Z. NERI, DOUGLAS L. LUYM, CESAR T.
Art. 19. Every person must in the exercise of his rights and in the performance of his LIBI, RAMONTITO* E. GARCIA and JOSE B. SALA, petitioners,
duties, act with justice, give every one his due, and observe honesty and good faith. vs.
RICARDO F. ELIZAGAQUE, respondent.
Article 19, also known as the "principle of abuse of right," prescribes that a person
should not use his right unjustly or contrary to honesty and good faith, otherwise he
DECISION
opens himself to liability. It seeks to preclude the use of, or the tendency to use, a
legal right (or duty) as a means to unjust ends.
SANDOVAL-GUTIERREZ, J.:
There is an abuse of right when it is exercised solely to prejudice or injure another.
The exercise of a right must be in accordance with the purpose for which it was For our resolution is the instant Petition for Review on Certiorari under Rule 45 of the
established and must not be excessive or unduly harsh; there must be no intention to 1997 Rules of Civil Procedure, as amended, assailing the Decision1 dated January 31,
harm another. Otherwise, liability for damages to the injured party will attach.
2003 and Resolution dated October 2, 2003 of the Court of Appeals in CA-G.R. CV Consequently, on December 23, 1998, respondent filed with the Regional Trial Court
No. 71506. (RTC), Branch 71, Pasig City a complaint for damages against petitioners, docketed
as Civil Case No. 67190.
The facts are:
After trial, the RTC rendered its Decision dated February 14, 2001 in favor of
Cebu Country Club, Inc. (CCCI), petitioner, is a domestic corporation operating as a respondent, thus:
non-profit and non-stock private membership club, having its principal place of
business in Banilad, Cebu City. Petitioners herein are members of its Board of WHEREFORE, judgment is hereby rendered in favor of plaintiff:
Directors.
1. Ordering defendants to pay, jointly and severally, plaintiff the amount of
Sometime in 1987, San Miguel Corporation, a special company proprietary member P2,340,000.00 as actual or compensatory damages.
of CCCI, designated respondent Ricardo F. Elizagaque, its Senior Vice President and
Operations Manager for the Visayas and Mindanao, as a special non-proprietary 2. Ordering defendants to pay, jointly and severally, plaintiff the amount of
member. The designation was thereafter approved by the CCCI’s Board of Directors. P5,000,000.00 as moral damages.

In 1996, respondent filed with CCCI an application for proprietary membership. The 3. Ordering defendants to pay, jointly and severally, plaintiff the amount of
application was indorsed by CCCI’s two (2) proprietary members, namely: Edmundo P1,000,000.00 as exemplary damages.
T. Misa and Silvano Ludo.
4. Ordering defendants to pay, jointly and severally, plaintiff the amount of
As the price of a proprietary share was around the P5 million range, Benito Unchuan, P1,000,000.00 as and by way of attorney’s fees and P80,000.00 as litigation expenses.
then president of CCCI, offered to sell respondent a share for only P3.5 million.
Respondent, however, purchased the share of a certain Dr. Butalid for only P3 5. Costs of suit.
million. Consequently, on September 6, 1996, CCCI issued Proprietary Ownership
Certificate No. 1446 to respondent. Counterclaims are hereby DISMISSED for lack of merit.

During the meetings dated April 4, 1997 and May 30, 1997 of the CCCI Board of SO ORDERED.
Directors, action on respondent’s application for proprietary membership was
deferred. In another Board meeting held on July 30, 1997, respondent’s application On appeal by petitioners, the Court of Appeals, in its Decision dated January 31,
was voted upon. Subsequently, or on August 1, 1997, respondent received a letter 2003, affirmed the trial court’s Decision with modification, thus:
from Julius Z. Neri, CCCI’s corporate secretary, informing him that the Board
disapproved his application for proprietary membership. WHEREFORE, premises considered, the assailed Decision dated February 14, 2001
of the Regional Trial Court, Branch 71, Pasig City in Civil Case No. 67190 is hereby
On August 6, 1997, Edmundo T. Misa, on behalf of respondent, wrote CCCI a letter AFFIRMED with MODIFICATION as follows:
of reconsideration. As CCCI did not answer, respondent, on October 7, 1997, wrote
another letter of reconsideration. Still, CCCI kept silent. On November 5, 1997, 1. Ordering defendants-appellants to pay, jointly and severally, plaintiff-appellee the
respondent again sent CCCI a letter inquiring whether any member of the Board amount of P2,000,000.00 as moral damages;
objected to his application. Again, CCCI did not reply.
2. Ordering defendants-appellants to pay, jointly and severally, plaintiff-appellee the
amount of P1,000,000.00 as exemplary damages;
3. Ordering defendants-appellants to pay, jointly and severally, plaintiff-appellee the (a) Any proprietary member, seconded by another voting proprietary member, shall
mount of P500,000.00 as attorney’s fees and P50,000.00 as litigation expenses; and submit to the Secretary a written proposal for the admission of a candidate to the
"Eligible-for-Membership List";
4. Costs of the suit.
(b) Such proposal shall be posted by the Secretary for a period of thirty (30) days on
The counterclaims are DISMISSED for lack of merit. the Club bulletin board during which time any member may interpose objections to
the admission of the applicant by communicating the same to the Board of Directors;
SO ORDERED.
(c) After the expiration of the aforesaid thirty (30) days, if no objections have been
On March 3, 2003, petitioners filed a motion for reconsideration and motion for leave filed or if there are, the Board considers the objections unmeritorious, the candidate
to set the motion for oral arguments. In its Resolution4 dated October 2, 2003, the shall be qualified for inclusion in the "Eligible-for-Membership List";
appellate court denied the motions for lack of merit.
(d) Once included in the "Eligible-for-Membership List" and after the candidate shall
Hence, the present petition. have acquired in his name a valid POC duly recorded in the books of the corporation
as his own, he shall become a Proprietary Member, upon a non-refundable admission
The issue for our resolution is whether in disapproving respondent’s application for fee of P1,000.00, provided that admission fees will only be collected once from any
proprietary membership with CCCI, petitioners are liable to respondent for damages, person.
and if so, whether their liability is joint and several.
On March 1, 1978, Section 3(c) was amended to read as follows:
Petitioners contend, inter alia, that the Court of Appeals erred in awarding exorbitant
damages to respondent despite the lack of evidence that they acted in bad faith in (c) After the expiration of the aforesaid thirty (30) days, the Board may, by
disapproving the latter’s application; and in disregarding their defense of damnum unanimous vote of all directors present at a regular or special meeting, approve the
absque injuria. inclusion of the candidate in the "Eligible-for-Membership List".

For his part, respondent maintains that the petition lacks merit, hence, should be As shown by the records, the Board adopted a secret balloting known as the "black
denied. ball system" of voting wherein each member will drop a ball in the ballot box. A
white ball represents conformity to the admission of an applicant, while a black ball
CCCI’s Articles of Incorporation provide in part: means disapproval. Pursuant to Section 3(c), as amended, cited above, a unanimous
vote of the directors is required. When respondent’s application for proprietary
SEVENTH: That this is a non-stock corporation and membership therein as well as membership was voted upon during the Board meeting on July 30, 1997, the ballot
the right of participation in its assets shall be limited to qualified persons who are box contained one (1) black ball. Thus, for lack of unanimity, his application was
duly accredited owners of Proprietary Ownership Certificates issued by the disapproved.
corporation in accordance with its By-Laws.
Obviously, the CCCI Board of Directors, under its Articles of Incorporation, has the
Corollary, Section 3, Article 1 of CCCI’s Amended By-Laws provides: right to approve or disapprove an application for proprietary membership. But such
right should not be exercised arbitrarily. Articles 19 and 21 of the Civil Code on the
SECTION 3. HOW MEMBERS ARE ELECTED – The procedure for the admission Chapter on Human Relations provide restrictions, thus:
of new members of the Club shall be as follows:
Article 19. Every person must, in the exercise of his rights and in the performance of on the required number of votes needed for admission of an applicant as a proprietary
his duties, act with justice, give everyone his due, and observe honesty and good member.
faith.
Petitioners explained that the amendment was not printed on the application form due
Article 21. Any person who willfully causes loss or injury to another in a manner that to economic reasons. We find this excuse flimsy and unconvincing. Such amendment,
is contrary to morals, good customs or public policy shall compensate the latter for aside from being extremely significant, was introduced way back in 1978 or almost
the damage. twenty (20) years before respondent filed his application. We cannot fathom why
such a prestigious and exclusive golf country club, like the CCCI, whose members
In GF Equity, Inc. v. Valenzona, we expounded Article 19 and correlated it with are all affluent, did not have enough money to cause the printing of an updated
Article 21, thus: application form.

This article, known to contain what is commonly referred to as the principle of abuse It is thus clear that respondent was left groping in the dark wondering why his
of rights, sets certain standards which must be observed not only in the exercise of application was disapproved. He was not even informed that a unanimous vote of the
one's rights but also in the performance of one's duties. These standards are the Board members was required. When he sent a letter for reconsideration and an
following: to act with justice; to give everyone his due; and to observe honesty and inquiry whether there was an objection to his application, petitioners apparently
good faith. The law, therefore, recognizes a primordial limitation on all rights; that in ignored him. Certainly, respondent did not deserve this kind of treatment. Having
their exercise, the norms of human conduct set forth in Article 19 must be observed. been designated by San Miguel Corporation as a special non-proprietary member of
A right, though by itself legal because recognized or granted by law as such, may CCCI, he should have been treated by petitioners with courtesy and civility. At the
nevertheless become the source of some illegality. When a right is exercised in a very least, they should have informed him why his application was disapproved.
manner which does not conform with the norms enshrined in Article 19 and results in
damage to another, a legal wrong is thereby committed for which the wrongdoer must The exercise of a right, though legal by itself, must nonetheless be in accordance with
be held responsible. But while Article 19 lays down a rule of conduct for the the proper norm. When the right is exercised arbitrarily, unjustly or excessively and
government of human relations and for the maintenance of social order, it does not results in damage to another, a legal wrong is committed for which the wrongdoer
provide a remedy for its violation. Generally, an action for damages under either must be held responsible. It bears reiterating that the trial court and the Court of
Article 20 or Article 21 would be proper. (Emphasis in the original) Appeals held that petitioners’ disapproval of respondent’s application is characterized
by bad faith.
In rejecting respondent’s application for proprietary membership, we find that
petitioners violated the rules governing human relations, the basic principles to be As to petitioners’ reliance on the principle of damnum absque injuria or damage
observed for the rightful relationship between human beings and for the stability of without injury, suffice it to state that the same is misplaced. In Amonoy v. Gutierrez,
social order. The trial court and the Court of Appeals aptly held that petitioners we held that this principle does not apply when there is an abuse of a person’s right,
committed fraud and evident bad faith in disapproving respondent’s applications. as in this case.
This is contrary to morals, good custom or public policy. Hence, petitioners are liable
for damages pursuant to Article 19 in relation to Article 21 of the same Code. As to the appellate court’s award to respondent of moral damages, we find the same
in order. Under Article 2219 of the New Civil Code, moral damages may be
It bears stressing that the amendment to Section 3(c) of CCCI’s Amended By-Laws recovered, among others, in acts and actions referred to in Article 21. We believe
requiring the unanimous vote of the directors present at a special or regular meeting respondent’s testimony that he suffered mental anguish, social humiliation and
was not printed on the application form respondent filled and submitted to CCCI. wounded feelings as a result of the arbitrary denial of his application. However, the
What was printed thereon was the original provision of Section 3(c) which was silent amount of P2,000,000.00 is excessive. While there is no hard-and-fast rule in
determining what would be a fair and reasonable amount of moral damages, the same
should not be palpably and scandalously excessive. Moral damages are not intended P25,000.00; and (c) the award of attorney’s fees and litigation expenses is reduced
to impose a penalty to the wrongdoer, neither to enrich the claimant at the expense of from P500,000.00 and P50,000.00 to P50,000.00 and P25,000.00, respectively.
the defendant. Taking into consideration the attending circumstances here, we hold
that an award to respondent of P50,000.00, instead of P2,000,000.00, as moral Costs against petitioners.
damages is reasonable.
SO ORDERED.
Anent the award of exemplary damages, Article 2229 allows it by way of example or
correction for the public good. Nonetheless, since exemplary damages are imposed G.R. No. 165443 April 16, 2009
not to enrich one party or impoverish another but to serve as a deterrent against or as
a negative incentive to curb socially deleterious actions, we reduce the amount from
P1,000,000.00 to P25,000.00 only. CALATAGAN GOLF CLUB, INC. Petitioner,
vs.
On the matter of attorney’s fees and litigation expenses, Article 2208 of the same
Code provides, among others, that attorney’s fees and expenses of litigation may be SIXTO CLEMENTE, JR., Respondent.
recovered in cases when exemplary damages are awarded and where the court deems
it just and equitable that attorney’s fees and expenses of litigation should be DECISION
recovered, as in this case. In any event, however, such award must be reasonable, just
and equitable. Thus, we reduce the amount of attorney’s fees (P500,000.00) and
litigation expenses (P50,000.00) to P50,000.00 and P25,000.00, respectively. TINGA, J.:
Lastly, petitioners’ argument that they could not be held jointly and severally liable Seeking the reversal of the Decision1 dated 1 June 2004 of the Court of Appeals in
for damages because only one (1) voted for the disapproval of respondent’s CA-G.R. SP No. 62331 and the reinstatement of the Decision dated 15 November
application lacks merit. 2000 of the Securities and Exchange Commission (SEC) in SEC Case No. 04-98-
5954, petitioner Calatagan Golf Club, Inc. (Calatagan) filed this Rule 45 petition
Section 31 of the Corporation Code provides: against respondent Sixto Clemente, Jr. (Clemente).

SEC. 31. Liability of directors, trustees or officers. — Directors or trustees who The key facts are undisputed.
willfully and knowingly vote for or assent to patently unlawful acts of the corporation
or who are guilty of gross negligence or bad faith in directing the affairs of the Clemente applied to purchase one share of stock of Calatagan, indicating in his
corporation or acquire any personal or pecuniary interest in conflict with their duty as application for membership his mailing address at "Phimco Industries, Inc. – P.O.
such directors, or trustees shall be liable jointly and severally for all damages Box 240, MCC," complete residential address, office and residence telephone
resulting therefrom suffered by the corporation, its stockholders or members and numbers, as well as the company (Phimco) with which he was connected, Calatagan
other persons. (Emphasis ours) issued to him Certificate of Stock No. A-01295 on 2 May 1990 after paying
₱120,000.00 for the share.2
WHEREFORE, we DENY the petition. The challenged Decision and Resolution of
the Court of Appeals in CA-G.R. CV No. 71506 are AFFIRMED with modification Calatagan charges monthly dues on its members to meet expenses for general
in the sense that (a) the award of moral damages is reduced from P2,000,000.00 to operations, as well as costs for upkeep and improvement of the grounds and facilities.
P50,000.00; (b) the award of exemplary damages is reduced from P1,000,000.00 to The provision on monthly dues is incorporated in Calatagan’s Articles of
Incorporation and By-Laws. It is also reproduced at the back of each certificate of
stock.3 As reproduced in the dorsal side of Certificate of Stock No. A-01295, the Nestor A. Virata.8 At the time of the sale, Clemente’s accrued monthly dues
provision reads: amounted to ₱5,200.00.9 A notice of foreclosure of Clemente’s share was published
in the 26 May 1993 issue of the Business World.10
5. The owners of shares of stock shall be subject to the payment of monthly dues in
an amount as may be prescribed in the by-laws or by the Board of Directors which Clemente learned of the sale of his share only in November of 1997.11 He filed a
shall in no case be less that [sic] ₱50.00 to meet the expenses for the general claim with the Securities and Exchange Commission (SEC) seeking the restoration of
operations of the club, and the maintenance and improvement of its premises and his shareholding in Calatagan with damages.
facilities, in addition to such fees as may be charged for the actual use of the facilities
xxx On 15 November 2000, the SEC rendered a decision dismissing Clemente’s
complaint. Citing Section 69 of the Corporation Code which provides that the sale of
When Clemente became a member the monthly charge stood at ₱400.00. He paid shares at an auction sale can only be questioned within six (6) months from the date
₱3,000.00 for his monthly dues on 21 March 1991 and another ₱5,400.00 on 9 of sale, the SEC concluded that Clemente’s claim, filed four (4) years after the sale,
December 1991. Then he ceased paying the dues. At that point, his balance amounted had already prescribed. The SEC further held that Calatagan had complied with all
to ₱400.00.4 the requirements for a valid sale of the subject share, Clemente having failed to
inform Calatagan that the address he had earlier supplied was no longer his address.
Ten (10) months later, Calatagan made the initial step to collect Clemente’s back Clemente, the SEC ruled, had acted in bad faith in assuming as he claimed that his
accounts by sending a demand letter dated 21 September 1992. It was followed by a non-payment of monthly dues would merely render his share "inactive."
second letter dated 22 October 1992. Both letters were sent to Clemente’s mailing
address as indicated in his membership application but were sent back to sender with Clemente filed a petition for review with the Court of Appeals. On 1 June 2004, the
the postal note that the address had been closed.5 Court of Appeals promulgated a decision reversing the SEC. The appellate court
restored Clemente’s one share with a directive to Calatagan to issue in his a new
Calatagan declared Clemente delinquent for having failed to pay his monthly dues for share, and awarded to Clemente a total of ₱400,000.00 in damages, less the unpaid
more than sixty (60) days, specifically ₱5,600.00 as of 31 October 1992. Calatagan monthly dues of ₱5,200.00.
also included Clemente’s name in the list of delinquent members posted on the club’s
bulletin board. On 1 December 1992, Calatagan’s board of directors adopted a In rejecting the SEC’s finding that the action had prescribed, the Court of Appeals
resolution authorizing the foreclosure of shares of delinquent members, including cited the SEC’s own ruling in SEC Case No. 4160, Caram v. Valley Golf Country
Clemente’s; and the public auction of these shares. Club, Inc., that Section 69 of the Corporation Code specifically refers to unpaid
subscriptions to capital stock, and not to any other debt of stockholders. With the
On 7 December 1992, Calatagan sent a third and final letter to Clemente, this time insinuation that Section 69 does not apply to unpaid membership dues in non-stock
signed by its Corporate Secretary, Atty. Benjamin Tanedo, Jr. The letter contains a corporations, the appellate court employed Article 1140 of the Civil Code as the
warning that unless Clemente settles his outstanding dues, his share would be proper rule of prescription. The provision sets the prescription period of actions to
included among the delinquent shares to be sold at public auction on 15 January recover movables at eight (8) years.
1993. Again, this letter was sent to Clemente’s mailing address that had already been
closed.6 The Court of Appeals also pointed out that since that Calatagan’s first two demand
letters had been returned to it as sender with the notation about the closure of the
On 5 January 1993, a notice of auction sale was posted on the Club’s bulletin board, mailing address, it very well knew that its third and final demand letter also sent to
as well as on the club’s premises. The auction sale took place as scheduled on 15 the same mailing address would not be received by Clemente. It noted the by-law
January 1993, and Clemente’s share sold for ₱64,000.7 According to the Certificate requirement that within ten (10) days after the Board has ordered the sale at auction
of Sale issued by Calatagan after the sale, Clemente’s share was purchased by a of a member’s share of stock for indebtedness, the Corporate Secretary shall notify
the owner thereof and advise the Membership Committee of such fact. Finally, the There are fundamental differences that defy equivalence or even analogy between the
Court of Appeals ratiocinated that "a person who is in danger of the imminent loss of sale of delinquent stock under Section 68 and the sale that occurred in this case. At
his property has the right to be notified and be given the chance to prevent the the root of the sale of delinquent stock is the non-payment of the subscription price
loss."12 for the share of stock itself. The stockholder or subscriber has yet to fully pay for the
value of the share or shares subscribed. In this case, Clemente had already fully paid
Hence, the present appeal. for the share in Calatagan and no longer had any outstanding obligation to deprive
him of full title to his share. Perhaps the analogy could have been made if Clemente
Calatagan maintains that the action of Clemente had prescribed pursuant to Section had not yet fully paid for his share and the non-stock corporation, pursuant to an
69 of the Corporation Code, and that the requisite notices under both the law and the article or by-law provision designed to address that situation, decided to sell such
by-laws had been rendered to Clemente. share as a consequence. But that is not the case here, and there is no purpose for us to
apply Section 69 to the case at bar.
Section 69 of the Code provides that an action to recover delinquent stock sold must
be commenced by the filing of a complaint within six (6) months from the date of Calatagan argues in the alternative that Clemente’s suit is barred by Article 1146 of
sale. As correctly pointed out by the Court of Appeals, Section 69 is part of Title VIII the Civil Code which establishes four (4) years as the prescriptive period for actions
of the Code entitled "Stocks and Stockholders" and refers specifically to unpaid based upon injury to the rights of the plaintiff on the hypothesis that the suit is purely
subscriptions to capital stock, the sale of which is governed by the immediately for damages. As a second alternative still, Calatagan posits that Clemente’s action is
preceding Section 68. governed by Article 1149 of the Civil Code which sets five (5) years as the period of
prescription for all other actions whose prescriptive periods are not fixed in the Civil
The Court of Appeals debunked both Calatagan’s and the SEC’s reliance on Section Code or in any other law. Neither article is applicable but Article 1140 of the Civil
69 by citing another SEC ruling in the case of Caram v. Valley Golf. In connection Code which provides that an action to recover movables shall prescribe in eight (8)
with Section 69, Calatagan raises a peripheral point made in the SEC’s Caram ruling. years. Calatagan’s action is for the recovery of a share of stock, plus damages.
In Caram, the SEC, using as take-off Section 6 of the Corporation Code which refers
to "such rights, privileges or restrictions as may be stated in the articles of Calatagan’s advertence to the fact that the constitution of a lien on the member’s
incorporation," pointed out that the Articles of Incorporation of Valley Golf does not share by virtue of the explicit provisions in its Articles of Incorporation and By-Laws
"impose any lien, liability or restriction on the Golf Share [of Caram]," but only its is relevant but ultimately of no help to its cause. Calatagan’s Articles of Incorporation
(Valley Golf’s) By-Laws does. Here, Calatagan stresses that its own Articles of states that the "dues, together with all other obligations of members to the club, shall
Incorporation does provide that the monthly dues assessed on owners of shares of the constitute a first lien on the shares, second only to any lien in favor of the national or
corporation, along with all other obligations of the shareholders to the club, "shall local government, and in the event of delinquency such shares may be ordered sold
constitute a first lien on the shares… and in the event of delinquency such shares may by the Board of Directors in the manner provided in the By-Laws to satisfy said dues
be ordered sold by the Board of Directors in the manner provided in the By-Laws to or other obligations of the stockholders."14 In turn, there are several provisions in the
satisfy said dues or other obligations of the shareholders."13 With its illative but By-laws that govern the payment of dues, the lapse into delinquency of the member,
incomprehensible logic, Calatagan concludes that the prescriptive period under and the constitution and execution on the lien. We quote these provisions:
Section 69 should also apply to the sale of Clemente’s share as the lien that Calatagan
perceives to be a restriction is stated in the articles of incorporation and not only in ARTICLE XII – MEMBER’S ACCOUNT
the by-laws.
SEC. 31. (a) Billing Members, Posting of Delinquent Members – The Treasurer shall
We remain unconvinced. bill al members monthly. As soon as possible after the end of every month, a
statement showing the account of bill of a member for said month will be prepared
and sent to him. If the bill of any member remains unpaid by the 20th of the month
following that in which the bill was incurred, the Treasurer shall notify him that if his repeated from time to time at the discretion of the Membership Committee until the
bill is not paid in full by the end of the succeeding month his name will be posted as share of stock be sold.
delinquent the following day at the Clubhouse bulletin board. While posted, a
member, the immediate members of his family, and his guests, may not avail of the (f) If the proceeds from the sale of the share of stock are not sufficient to pay in full
facilities of the Club. the indebtedness of the member, the member shall continue to be obligated to the
Club for the unpaid balance. If the member whose share of stock is sold fails or refuse
(b) Members on the delinquent list for more than 60 days shall be reported to the to surrender the stock certificate for cancellation, cancellation shall be effected in the
Board and their shares or the shares of the juridical entities they represent shall books of the Club based on a record of the proceedings. Such cancellation shall
thereafter be ordered sold by the Board at auction to satisfy the claims of the Club as render the unsurrendered stock certificate null and void and notice to this effect shall
provided for in Section 32 hereon. A member may pay his overdue account at any be duly published.
time before the auction sale.
It is plain that Calatagan had endeavored to install a clear and comprehensive
Sec. 32. Lien on Shares; Sale of Share at Auction- The club shall have a first lien on procedure to govern the payment of monthly dues, the declaration of a member as
every share of stock to secure debts of the members to the Club. This lien shall be delinquent, and the constitution of a lien on the shares and its eventual public sale to
annotated on the certificates of stock and may be enforced by the Club in the answer for the member’s debts. Under Section 91 of the Corporation Code,
following manner: membership in a non-stock corporation "shall be terminated in the manner and for the
causes provided in the articles of incorporation or the by-laws." The By-law
(a) Within ten (10) days after the Board has ordered the sale at auction of a member’s provisions are elaborate in explaining the manner and the causes for the termination
share of stock for indebtedness under Section 31(b) hereof, the Secretary shall notify of membership in Calatagan, through the execution on the lien of the share. The Court
the owner thereof, and shall advise the Membership Committee of such fact. is satisfied that the By-Laws, as written, affords due protection to the member by
assuring that the member should be notified by the Secretary of the looming
(b) The Membership Committee shall then notify all applicants on the Waiting List execution sale that would terminate membership in the club. In addition, the By-Laws
and all registered stockholders of the availability of a share of stock for sale at auction guarantees that after the execution sale, the proceeds of the sale would be returned to
at a specified date, time and place, and shall post a notice to that effect in the Club the former member after deducting the outstanding obligations. If followed to the
bulletin board for at least ten (10) days prior to the auction sale. letter, the termination of membership under this procedure outlined in the By-Laws
would accord with substantial justice.
(c) On the date and hour fixed, the Membership Committee shall proceed with the
auction by viva voce bidding and award the sale of the share of stock to the highest Yet, did Calatagan actually comply with the by-law provisions when it sold
bidder. Clemente’s share? The appellate court’s finding on this point warrants our approving
citation, thus:
(d) The purchase price shall be paid by the winning bidder to the Club within twenty-
four (24) hours after the bidding. The winning bidder or the representative in the case In accordance with this provision, Calatagan sent the third and final demand letter to
of a juridical entity shall become a Regular Member upon payment of the purchase Clemente on December 7, 1992. The letter states that if the amount of delinquency is
price and issuance of a new stock certificate in his name or in the name of the not paid, the share will be included among the delinquent shares to be sold at public
juridical entity he represents. The proceeds of the sale shall be paid by the Club to the auction. This letter was signed by Atty. Benjamin Tanedo, Jr., Calatagan Golf’s
selling stockholder after deducting his obligations to the Club. Corporate Secretary. It was again sent to Clemente’s mailing address – Phimco
Industries Inc., P.O. Box 240, MCC Makati. As expected, it was returned because the
(e) If no bids be received or if the winning bidder fails to pay the amount of this bid post office box had been closed.
within twenty-four (24) hours after the bidding, the auction procedures may be
Under the By-Laws, the Corporate Secretary is tasked to "give or cause to be given, then, the bad faith on Calatagan’s part is palpable. As found by the Court of Appeals,
all notices required by law or by these By-Laws. .. and … keep a record of the Calatagan very well knew that Clemente’s postal box to which it sent its previous
addresses of all stockholders. As quoted above, Sec. 32 (a) of the By-Laws further letters had already been closed, yet it persisted in sending that final letter to the same
provides that "within ten (10) days after the Board has ordered the sale at auction of a postal box. What for? Just for the exercise, it appears, as it had known very well that
member’s share of stock for indebtedness under Section 31 (b) hereof, the Secretary the letter would never actually reach Clemente.1avvphi1
shall notify the owner thereof and shall advise the Membership Committee of such
fact.," The records do not disclose what report the Corporate Secretary transmitted to It is noteworthy that Clemente in his membership application had provided his
the Membership Committee to comply with Section 32(a). Obviously, the reason for residential address along with his residence and office telephone numbers. Nothing in
this mandatory requirement is to give the Membership Committee the opportunity to Section 32 of Calatagan’s By-Laws requires that the final notice prior to the sale be
find out, before the share is sold, if proper notice has been made to the shareholder made solely through the member’s mailing address. Clemente cites our aphorism-like
member. pronouncement in Rizal Commercial Banking Corporation v. Court of Appeals15 that
"[a] simple telephone call and an ounce of good faith x x x could have prevented this
We presume that the Corporate Secretary, as a lawyer is knowledgeable on the law present controversy." That memorable observation is quite apt in this case.
and on the standards of good faith and fairness that the law requires. As custodian of
corporate records, he should also have known that the first two letters sent to Calatagan’s bad faith and failure to observe its own By-Laws had resulted not merely
Clemente were returned because the P.O. Box had been closed. Thus, we are in the loss of Clemente’s privilege to play golf at its golf course and avail of its
surprised – given his knowledge of the law and of corporate records – that he would amenities, but also in significant pecuniary damage to him. For that loss, the only
send the third and final letter – Clemente’s last chance before his share is sold and his blame that could be thrown Clemente’s way was his failure to notify Calatagan of the
membership lost – to the same P.O. Box that had been closed. closure of the P.O. Box. That lapse, if we uphold Calatagan would cost Clemente a
lot. But, in the first place, does he deserve answerability for failing to notify the club
Calatagan argues that it "exercised due diligence before the foreclosure sale" and of the closure of the postal box? Indeed, knowing as he did that Calatagan was in
"sent several notices to Clemente’s specified mailing address." We do not agree; we possession of his home address as well as residence and office telephone numbers, he
cannot label as due diligence Calatagan’s act of sending the December 7, 1992 letter had every reason to assume that the club would not be at a loss should it need to
to Clemente’s mailing address knowing fully well that the P.O. Box had been closed. contact him. In addition, according to Clemente, he was not even aware of the closure
Due diligence or good faith imposes upon the Corporate Secretary – the chief of the postal box, the maintenance of which was not his responsibility but his
repository of all corporate records – the obligation to check Clemente’s other address employer Phimco’s.
which, under the By-Laws, have to be kept on file and are in fact on file. One obvious
purpose of giving the Corporate Secretary the duty to keep the addresses of members The utter bad faith exhibited by Calatagan brings into operation Articles 19, 20 and
on file is specifically for matters of this kind, when the member cannot be reached 21 of the Civil Code, under the Chapter on Human Relations. These provisions,
through his or her mailing address. Significantly, the Corporate Secretary does not which the Court of Appeals did apply, enunciate a general obligation under law for
have to do the actual verification of other addressees on record; a mere clerk can do every person to act fairly and in good faith towards one another. A non-stock
the very simple task of checking the files as in fact clerks actually undertake these corporation like Calatagan is not exempt from that obligation in its treatment of its
tasks. In fact, one telephone call to Clemente’s phone numbers on file would have members. The obligation of a corporation to treat every person honestly and in good
alerted him of his impending loss. faith extends even to its shareholders or members, even if the latter find themselves
contractually bound to perform certain obligations to the corporation. A certificate of
Ultimately, the petition must fail because Calatagan had failed to duly observe both stock cannot be a charter of dehumanization.
the spirit and letter of its own by-laws. The by-law provisions was clearly conceived
to afford due notice to the delinquent member of the impending sale, and not just to We turn to the matter of damages. The award of actual damages is of course
provide an intricate façade that would facilitate Calatagan’s sale of the share. But warranted since Clemente has sustained pecuniary injury by reason of Calatagan’s
wrongful violation of its own By-Laws. It would not be feasible to deliver Clemente’s SPOUSES JAVIER AND MA. THERESA PASTORFIDE,
original Certificate of Stock because it had already been cancelled and a new one
issued in its place in the name of the purchases at the auction who was not impleaded CAGAYAN DE ORO WATER DISTRICT AND GASPAR
in this case. However, the Court of Appeals instead directed that Calatagan to issue to GONZALEZ,* JR., RESPONDENTS.
Clemente a new certificate of stock. That sufficiently redresses the actual damages
sustained by Clemente. After all, the certificate of stock is simply the evidence of the
share. DECISION

The Court of Appeals also awarded Clemente ₱200,000.00 as moral damages, PERALTA, J.:
₱100,000.00 as exemplary damages, and ₱100,000.00 as attorney’s fees. We agree
that the award of such damages is warranted. Before the Court is a petition for review on certiorari under Rule 45 of the Rules of
Court seeking to reverse and set aside the Decision1 and Resolution2 of the Court of
The Court of Appeals cited Calatagan for violation of Article 32 of the Civil Code, Appeals (CA), dated August 28, 2003 and December 17, 2003, respectively, in CA-
which allows recovery of damages from any private individual "who directly or G.R. CV No. 73000. The CA Decision affirmed with modification the August 15,
indirectly obstructs, defeats, violates or in any manner impedes or impairs" the right 2001 Decision3 of the Regional Trial Court (RTC) of Cagayan de Oro City, Branch
"against deprivation of property without due process of laws." The plain letter of the 24, while the CA Resolution denied petitioner's Motion for Reconsideration.
provision squarely entitles Clemente to damages from Calatagan. Even without
Article 32 itself, Calatagan will still be bound to pay moral and exemplary damages The facts, as summarized by the CA, are as follows:
to Clemente. The latter was able to duly prove that he had sustained mental anguish,
serious anxiety and wounded feelings by reason of Calatagan’s acts, thereby entitling [Herein petitioner] Joyce V. Ardiente and her husband Dr. Roberto S. Ardiente are
him to moral damages under Article 2217 of the Civil Code. Moreover, it is evident owners of a housing unit at Emily Homes, Balulang, Cagayan de Oro City with a lot
that Calatagan’s bad faith as exhibited in the course of its corporate actions warrants area of one hundred fifty-three (153) square meters and covered by Transfer
correction for the public good, thereby justifying exemplary damages under Article Certificate of Title No. 69905.
2229 of the Civil Code.
On June 2, 1994, Joyce Ardiente entered into a Memorandum of Agreement (Exh.
WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals is "B", pp. 470-473, Records) selling, transferring and conveying in favor of
AFFIRMED. Costs against petitioner. [respondent] Ma. Theresa Pastorfide all their rights and interests in the housing unit at
Emily Homes in consideration of ₱70,000.00. The Memorandum of Agreement
SO ORDERED. carries a stipulation:

G.R. No. 161921 July 17, 2013 "4. That the water and power bill of the subject property shall be for the account of
the Second Party (Ma. Theresa Pastorfide) effective June 1, 1994." (Records, p. 47)
JOYCE V. ARDIENTE, PETITIONER, vis-a-vis Ma. Theresa Pastorfide's assumption of the payment of the mortgage loan
vs. secured by Joyce Ardiente from the National Home Mortgage (Records, Exh. "A",
pp. 468-469)
For four (4) years, Ma. Theresa's use of the water connection in the name of Joyce They should not have been swayed by the prodding of Joyce V. Ardiente. They
Ardiente was never questioned nor perturbed (T.S.N., October 31, 2000, pp. 7-8) until should have investigated first as to the present ownership of the house. For doing the
on March 12, 1999, without notice, the water connection of Ma. Theresa was cut off. act because Ardiente told them, they were negligent. Defendant Joyce Ardiente
Proceeding to the office of the Cagayan de Oro Water District (COWD) to complain, should have requested before the cutting off of the water supply, plaintiffs to pay.
a certain Mrs. Madjos told Ma. Theresa that she was delinquent for three (3) months While she attempted to tell plaintiffs but she did not have the patience of seeing them.
corresponding to the months of December 1998, January 1999, and February 1999. She knew that it was plaintiffs who had been using the water four (4) years ago and
Ma. Theresa argued that the due date of her payment was March 18, 1999 yet (T.S.N., not hers. She should have been very careful. x x x5
October 31, 2000, pp. 11-12). Mrs. Madjos later told her that it was at the instance of
Joyce Ardiente that the water line was cut off (T.S.N., February 5, 2001, p. 31). The dispositive portion of the trial court's Decision reads, thus:

On March 15, 1999, Ma. Theresa paid the delinquent bills (T.S.N., October 31, 2000, WHEREFORE, premises considered, judgment is hereby rendered ordering
p. 12). On the same date, through her lawyer, Ma. Theresa wrote a letter to the defendants [Ardiente, COWD and Gonzalez] to pay jointly and severally plaintiffs,
COWD to explain who authorized the cutting of the water line (Records, p. 160). the following sums:

On March 18, 1999, COWD, through the general manager, [respondent] Gaspar (a) ₱200,000.00 for moral damages;
Gonzalez, Jr., answered the letter dated March 15, 1999 and reiterated that it was at
the instance of Joyce Ardiente that the water line was cut off (Records, p. 161). (b) 200,000.00 for exemplary damages; and

Aggrieved, on April 14, 1999, Ma. Theresa Pastorfide [and her husband] filed [a] (c) 50,000.00 for attorney's fee.
complaint for damages [against petitioner, COWD and its manager Gaspar Gonzalez]
(Records, pp. 2-6). The cross-claim of Cagayan de Oro Water District and Engr. Gaspar Gonzales is
hereby dismissed. The Court is not swayed that the cutting off of the water supply of
In the meantime, Ma. Theresa Pastorfide's water line was only restored and plaintiffs was because they were influenced by defendant Joyce Ardiente. They were
reconnected when the [trial] court issued a writ of preliminary mandatory injunction negligent too for which they should be liable.
on December 14, 1999 (Records, p. 237).4
SO ORDERED.6
After trial, the RTC rendered judgment holding as follows:
Petitioner, COWD and Gonzalez filed an appeal with the CA.
xxxx
On August 28, 2003, the CA promulgated its assailed Decision disposing as follows:
In the exercise of their rights and performance of their duties, defendants did not act
with justice, gave plaintiffs their due and observe honesty and good faith. Before IN VIEW OF ALL THE FOREGOING, the appealed decision is AFFIRMED, with
disconnecting the water supply, defendants COWD and Engr. Gaspar Gonzales did the modification that the awarded damages is reduced to ₱100,000.00 each for moral
not even send a disconnection notice to plaintiffs as testified to by Engr. Bienvenido and exemplary damages, while attorney's fees is lowered to ₱25,000.00. Costs against
Batar, in-charge of the Commercial Department of defendant COWD. There was one appellants.
though, but only three (3) days after the actual disconnection on March 12, 1999. The
due date for payment was yet on March 15. Clearly, they did not act with justice. SO ORDERED.7
Neither did they observe honesty.
The CA ruled, with respect to petitioner, that she has a "legal duty to honor the THREE MONTHS AND TO MOVE FOR THE TRANSFER OF THE COWD
possession and use of water line by Ma. Theresa Pastorfide pursuant to their ACCOUNT IN THEIR NAME, WHICH WAS A VIOLATION OF THEIR
Memorandum of Agreement" and "that when [petitioner] applied for its MEMORANDUM OF AGREEMENT WITH PETITIONER JOYCE V. ARDIENTE.
disconnection, she acted in bad faith causing prejudice and [injury to] Ma. Theresa RESPONDENTS LIKEWISE DELIBERATELY FAILED TO EXERCISE
Pastorfide."8 DILIGENCE OF A GOOD FATHER OF THE FAMILY TO MINIMIZE THE
DAMAGE UNDER ART. 2203 OF THE NEW CIVIL CODE.
As to COWD and Gonzalez, the CA held that they "failed to give a notice of
disconnection and derelicted in reconnecting the water line despite payment of the 7.3 THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED WHEN IT
unpaid bills by the [respondent spouses Pastorfide]."9 DISREGARDED THE FACT THAT RESPONDENT SPOUSES PASTORFIDE
ARE LIKEWISE BOUND TO OBSERVE ARTICLE 19 OF THE NEW CIVIL
Petitioner, COWD and Gonzalez filed their respective Motions for Reconsideration, CODE, i.e., IN THE EXERCISE OF THEIR RIGHTS AND IN THE
but these were denied by the CA in its Resolution dated December 17, 2003. PERFORMANCE OF THEIR DUTIES TO ACT WITH JUSTICE, GIVE
EVERYONE HIS DUE AND OBSERVE HONESTY AND GOOD FAITH.
COWD and Gonzalez filed a petition for review on certiorari with this Court, which
was docketed as G.R. No. 161802. However, based on technical grounds and on the 7.4 THE HONORABLE COURT OF APPEALS GRAVELY ERRED WHEN IT
finding that the CA did not commit any reversible error in its assailed Decision, the GRANTED AN AWARD OF MORAL AND EXEMPLARY DAMAGES AND
petition was denied via a Resolution10 issued by this Court on March 24, 2004. ATTORNEY'S FEES AS AGAINST PETITIONER ARDIENTE.12
COWD and Gonzalez filed a motion for reconsideration, but the same was denied
with finality through this Court's Resolution11 dated June 28, 2004. At the outset, the Court noticed that COWD and Gonzalez, who were petitioner's co-
defendants before the RTC and her co-appellants in the CA, were impleaded as
Petitioner, on the other hand, timely filed the instant petition with the following respondents in the instant petition. This cannot be done. Being her co-parties before
Assignment of Errors: the RTC and the CA, petitioner cannot, in the instant petition for review on certiorari,
make COWD and Gonzalez, adversary parties. It is a grave mistake on the part of
7.1 HONORABLE COURT OF APPEALS (ALTHOUGH IT HAS REDUCED THE petitioner's counsel to treat COWD and Gonzalez as respondents. There is no basis to
LIABILITY INTO HALF) HAS STILL COMMITTED GRAVE AND SERIOUS do so, considering that, in the first place, there is no showing that petitioner filed a
ERROR WHEN IT UPHELD THE JOINT AND SOLIDARY LIABILITY OF cross-claim against COWD and Gonzalez. Under Section 2, Rule 9 of the Rules of
PETITIONER JOYCE V. ARDIENTE WITH CAGAYAN DE ORO WATER Court, a cross-claim which is not set up shall be barred. Thus, for failing to set up a
DISTRICT (COWD) AND ENGR. GASPAR D. GONZALES FOR THE LATTER'S cross-claim against COWD and Gonzalez before the RTC, petitioner is already barred
FAILURE TO SERVE NOTICE UPON RESPONDENTS SPOUSES PASTORFIDE from doing so in the present petition.
PRIOR TO THE ACTUAL DISCONNECTION DESPITE EVIDENCE ADDUCED
DURING TRIAL THAT EVEN WITHOUT PETITIONER'S REQUEST, COWD More importantly, as shown above, COWD and Gonzalez's petition for review on
WAS ALREADY SET TO EFFECT DISCONNECTION OF RESPONDENTS' certiorari filed with this Court was already denied with finality on June 28, 2004,
WATER SUPPLY DUE TO NON-PAYMENT OF ACCOUNT FOR THREE (3) making the presently assailed CA Decision final and executory insofar as COWD and
MONTHS. Gonzalez are concerned. Thus, COWD and Gonzalez are already precluded from
participating in the present petition. They cannot resurrect their lost cause by filing
7.2 THE HONORABLE COURT OF APPEALS COMMITTED GRAVE AND pleadings this time as respondents but, nonetheless, reiterating the same prayer in
SERIOUS ERROR WHEN IT RULED TOTALLY AGAINST PETITIONER AND their previous pleadings filed with the RTC and the CA.
FAILED TO FIND THAT RESPONDENTS ARE GUILTY OF CONTRIBUTORY
NEGLIGENCE WHEN THEY FAILED TO PAY THEIR WATER BILLS FOR
As to the merits of the instant petition, the Court likewise noticed that the main issues There was clearly an abuse of right on the part of petitioner, COWD and Gonzalez.
raised by petitioner are factual and it is settled that the resolution of factual issues is They are guilty of bad faith.
the function of lower courts, whose findings on these matters are received with
respect and considered binding by the Supreme Court subject only to certain The principle of abuse of rights as enshrined in Article 19 of the Civil Code provides
exceptions, none of which is present in this instant petition.13 This is especially true that every person must, in the exercise of his rights and in the performance of his
when the findings of the RTC have been affirmed by the CA as in this case.14 duties, act with justice, give everyone his due, and observe honesty and good faith.

In any case, a perusal of the records at hand would readily show that the instant In this regard, the Court's ruling in Yuchengco v. The Manila Chronicle Publishing
petition lacks merit. Corporation17 is instructive, to wit:

Petitioner insists that she should not be held liable for the disconnection of respondent xxxx
spouses' water supply, because she had no participation in the actual disconnection.
However, she admitted in the present petition that it was she who requested COWD This provision of law sets standards which must be observed in the exercise of one’s
to disconnect the Spouses Pastorfide's water supply. This was confirmed by COWD rights as well as in the performance of its duties, to wit: to act with justice; give
and Gonzalez in their cross-claim against petitioner. While it was COWD which everyone his due; and observe honesty and good faith.
actually discontinued respondent spouses' water supply, it cannot be denied that it
was through the instance of petitioner that the Spouses Pastorfide's water supply was In Globe Mackay Cable and Radio Corporation v. Court of Appeals, it was elucidated
disconnected in the first place. that while Article 19 "lays down a rule of conduct for the government of human
relations and for the maintenance of social order, it does not provide a remedy for its
It is true that it is within petitioner's right to ask and even require the Spouses violation. Generally, an action for damages under either Article 20 or Article 21
Pastorfide to cause the transfer of the former's account with COWD to the latter's would be proper." The Court said:
name pursuant to their Memorandum of Agreement. However, the remedy to enforce
such right is not to cause the disconnection of the respondent spouses' water supply. One of the more notable innovations of the New Civil Code is the codification of
The exercise of a right must be in accordance with the purpose for which it was "some basic principles that are to be observed for the rightful relationship between
established and must not be excessive or unduly harsh; there must be no intention to human beings and for the stability of the social order." [REPORT ON THE CODE
harm another.15 Otherwise, liability for damages to the injured party will attach.16 In COMMISSION ON THE PROPOSED CIVIL CODE OF THE PHILIPPINES, p. 39].
the present case, intention to harm was evident on the part of petitioner when she The framers of the Code, seeking to remedy the defect of the old Code which merely
requested for the disconnection of respondent spouses’ water supply without warning stated the effects of the law, but failed to draw out its spirit, incorporated certain
or informing the latter of such request. Petitioner claims that her request for fundamental precepts which were "designed to indicate certain norms that spring
disconnection was based on the advise of COWD personnel and that her intention from the fountain of good conscience" and which were also meant to serve as "guides
was just to compel the Spouses Pastorfide to comply with their agreement that for human conduct [that] should run as golden threads through society, to the end that
petitioner's account with COWD be transferred in respondent spouses' name. If such law may approach its supreme ideal, which is the sway and dominance of justice."
was petitioner's only intention, then she should have advised respondent spouses (Id.) Foremost among these principles is that pronounced in Article 19 x x x.
before or immediately after submitting her request for disconnection, telling them that
her request was simply to force them to comply with their obligation under their xxxx
Memorandum of Agreement. But she did not. What made matters worse is the fact
that COWD undertook the disconnection also without prior notice and even failed to This article, known to contain what is commonly referred to as the principle of abuse
reconnect the Spouses Pastorfide’s water supply despite payment of their arrears. of rights, sets certain standards which must be observed not only in the exercise of
one's rights, but also in the performance of one's duties. These standards are the
following: to act with justice; to give everyone his due; and to observe honesty and
good faith. The law, therefore, recognizes a primordial limitation on all rights; that in As for exemplary damages, Article 2229 provides that exemplary damages may be
their exercise, the norms of human conduct set forth in Article 19 must be observed. imposed by way of example or correction for the public good. Nonetheless,
A right, though by itself legal because recognized or granted by law as such, may exemplary damages are imposed not to enrich one party or impoverish another, but to
nevertheless become the source of some illegality. When a right is exercised in a serve as a deterrent against or as a negative incentive to curb socially deleterious
manner which does not conform with the norms enshrined in Article 19 and results in actions.22 In the instant case, the Court agrees with the CA in sustaining the award of
damage to another, a legal wrong is thereby committed for which the wrongdoer must exemplary damages, although it reduced the amount granted, considering that
be held responsible. But while Article 19 lays down a rule of conduct for the respondent spouses were deprived of their water supply for more than nine (9)
government of human relations and for the maintenance of social order, it does not months, and such deprivation would have continued were it not for the relief granted
provide a remedy for its violation. Generally, an action for damages under either by the RTC.
Article 20 or Article 21 would be proper.
With respect to the award of attorney's fees, Article 2208 of the Civil Code provides,
Corollarilly, Article 20 provides that "every person who, contrary to law, willfully or among others, that such fees may be recovered when exemplary damages are
negligently causes damage to another shall indemnify the latter for the same." It awarded, when the defendant's act or omission has compelled the plaintiff to litigate
speaks of the general sanctions of all other provisions of law which do not especially with third persons or to incur expenses to protect his interest, and where the defendant
provide for its own sanction. When a right is exercised in a manner which does not acted in gross and evident bad faith in refusing to satisfy the plaintiffs’ plainly valid,
conform to the standards set forth in the said provision and results in damage to just and demandable claim.
another, a legal wrong is thereby committed for which the wrongdoer must be
responsible. Thus, if the provision does not provide a remedy for its violation, an WHEREFORE, instant petition for review on certiorari is DENIED. The Decision
action for damages under either Article 20 or Article 21 of the Civil Code would be and Resolution of the Court of Appeals, dated August 28, 2003 and December 17,
proper. 2003, respectively, in CA-G.R. CV No. 73000 are AFFIRMED.

The question of whether or not the principle of abuse of rights has been violated SO ORDERED.
resulting in damages under Article 20 or other applicable provision of law, depends
on the circumstances of each case. x x x G.R. No. 160689 March 26, 2014
To recapitulate, petitioner's acts which violated the abovementioned provisions of law
is her unjustifiable act of having the respondent spouses' water supply disconnected, RAUL H. SESBREÑO, Petitioner,
coupled with her failure to warn or at least notify respondent spouses of such vs.
intention. On the part of COWD and Gonzalez, it is their failure to give prior notice
of the impending disconnection and their subsequent neglect to reconnect respondent HONORABLE COURT OF APPEALS, JUAN I.
spouses' water supply despite the latter's settlement of their delinquent account. COROMINA (SUBSTITUTED BY ANITA COROMINA,
ELIZABETH COROMINA and ROSIEMARIE
On the basis of the foregoing, the Court finds no cogent reason to depart from the
ruling of both the RTC and the CA that petitioner, COWD and Gonzalez are COROMINA), VICENTE E. GARCIA (SUBSTITUTED BY
solidarily liable. EDGAR JOHN GARCIA), FELIPE CONSTANTINO,
RONALD ARCILLA, NORBETO ABELLANA,
The Spouses Pastorfide are entitled to moral damages based on the provisions of
Article 2219, in connection with Articles 20 and 21 of the Civil Code. DEMETRIO BALICHA, ANGELITA LHUILLIER, JOSE
E. GARCIA, AND VISA YAN ELECTRIC COMPANY inspectors during their inspection of the households of its customers on May 11, 1989
pursuant to a mission order issued to him.5
(VECO), Respondents.
The CA summarized the antecedent facts as follows:
DECISION
x x x. Reduced to its essentials, however, the facts of this case are actually simple
enough, although the voluminous records might indicate otherwise. It all has to do
BERSAMIN, J.: with an incident that occurred at around 4:00 o’clock in the afternoon of May 11,
1989. On that day, the Violation of Contracts (VOC) Team of defendants-appellees
This case concerns the claim for damages of petitioner Raul H. Sesbreño founded on Constantino and Arcilla and their PC escort, Balicha, conducted a routine inspection
abuse of rights. Sesbreño accused the violation of contract (VOC) inspection team of the houses at La Paloma Village, Labangon, Cebu City, including that of plaintiff-
dispatched by the Visayan Electric Company (VECO) to check his electric meter with appellant Sesbreño, for illegal connections, meter tampering, seals, conduit pipes,
conducting an unreasonable search in his residential premises. But the Regional Trial jumpers, wiring connections, and meter installations. After Bebe Baledio, plaintiff-
Court (RTC), Branch 13, in Cebu City rendered judgment on August 19, 1994 appellant Sesbreño’s maid, unlocked the gate, they inspected the electric meter and
dismissing the claim;1 and the Court of Appeals (CA) affirmed the dismissal on found that it had been turned upside down. Defendant-appellant Arcilla took
March 10, 2003.2 photographs of the upturned electric meter. With Chuchie Garcia, Peter Sesbreño and
one of the maids present, they removed said meter and replaced it with a new one. At
Hence, this appeal by Sesbreño. that time, plaintiff-appellant Sesbreño was in his office and no one called to inform
him of the inspection. The VOC Team then asked for and received Chuchie Garcia’s
Antecedents permission to enter the house itself to examine the kind and number of appliances and
light fixtures in the household and determine its electrical load. Afterwards, Chuchie
At the time material to the petition, VECO was a public utility corporation organized Garcia signed the Inspection Division Report, which showed the condition of the
and existing under the laws of the Philippines. VECO engaged in the sale and electric meter on May 11, 1989 when the VOC Team inspected it, with notice that it
distribution of electricity within Metropolitan Cebu. Sesbreño was one of VECO’s would be subjected to a laboratory test. She also signed a Load Survey Sheet that
customers under the metered service contract they had entered into on March 2, showed the electrical load of plaintiff-appellant Sesbreño.
1982.3 Respondent Vicente E. Garcia was VECO’s President, General Manager and
Chairman of its Board of Directors. Respondent Jose E. Garcia was VECO’s Vice- But according to plaintiff-appellant Sesbreño there was nothing routine or proper at
President, Treasurer and a Member of its Board of Directors. Respondent Angelita all with what the VOC Team did on May 11, 1989 in his house. Their entry to his
Lhuillier was another Member of VECO’s Board of Directors. Respondent Juan house and the surrounding premises was effected without his permission and over the
Coromina was VECO’s Assistant Treasurer, while respondent Norberto Abellana was objections of his maids. They threatened, forced or coerced their way into his house.
the Head of VECO’s Billing Section whose main function was to compute back They unscrewed the electric meter, turned it upside down and took photographs
billings of customers found to have violated their contracts. thereof. They then replaced it with a new electric meter. They searched the house and
its rooms without his permission or a search warrant. They forced a visitor to sign two
To ensure that its electric meters were properly functioning, and that none of it meters documents, making her appear to be his representative or agent. Afterwards, he found
had been tampered with, VECO employed respondents Engr. Felipe Constantino and that some of his personal effects were missing, apparently stolen by the VOC Team
Ronald Arcilla as violation of contract (VOC) inspectors.4 Respondent Sgt. Demetrio when they searched the house.6
Balicha, who belonged to the 341st Constabulary Company, Cebu Metropolitan
Command, Camp Sotero Cabahug, Cebu City, accompanied and escorted the VOC Judgment of the RTC
On August 19, 1994, the RTC rendered judgment dismissing the complaint. It did not customers in the guise of conducting a Violation of Contracts inspection, plaintiff-
accord credence to the testimonies of Sesbreño’s witnesses, Bebe Baledio, his appellant Sesbreño likewise failed to show why he alone was singled out. It is also
housemaid, and Roberto Lopez, a part-time salesman, due to inconsistencies on difficult to believe that the VOC Team would be brazen enough to want to antagonize
material points in their respective testimonies. It observed that Baledio could not a person such as plaintiff-appellant Sesbreño. There is no evidence that the VOC
make up her mind as to whether Sesbreño’s children were in the house when the Team harbored any evil motive or grudge against plaintiff-appellant Sesbreño, who is
VOC inspection team detached and replaced the electric meter. Likewise, it a total stranger to them. Until he came along, they did not have any prior criminal
considered unbelievable that Lopez should hear the exchanges between Constantino, records to speak of, or at least, no evidence thereof was presented. It is equally
Arcilla and Balicha, on one hand, and Baledio, on the other, considering that Lopez difficult to believe that their superiors would authorize or condone their alleged
could not even hear the conversation between two persons six feet away from where illegal acts. Especially so since there is no indication that prior to the incident on May
he was seated during the simulation done in court, the same distance he supposedly 11, 1989, there was already bad blood or animosity between plaintiff-appellant
had from the gate of Sesbreño’s house during the incident. It pointed out that Lopez’s Sesbreño and defendant appellees to warrant such a malevolent response. In fact,
presence at the gate during the incident was even contradicted by his own testimony since availing of defendant-appellee VECO’s power services, the relationship
indicating that an elderly woman had opened the gate for the VECO personnel, between them appears to have been uneventful.
because it was Baledio, a lady in her 20s, who had repeatedly stated on her direct and
cross examinations that she had let the VECO personnel in. It concluded that for It becomes all the more apparent that the charges stemming from the May 11, 1989
Lopez to do nothing at all upon seeing a person being threatened by another in the incident were fabricated when taken together with the lower court’s evaluation of the
manner he described was simply contrary to human experience. alleged theft of plaintiff-appellant Sesbreño’s personal effects. It stated that on
August 8, 1989, plaintiff-appellant Sesbreño wrote the barangay captain of Punta
In contrast, the RTC believed the evidence of the respondents showing that the VOC Princesa and accused Chuchie Garcia and Victoria Villarta alias Victoria Rocamora
inspection team had found the electric meter in Sesbreño’s residence turned upside of theft of some of his things that earlier he claimed had been stolen by members of
down to prevent the accurate registering of the electricity consumption of the the VOC Team. When he was confronted with these facts, plaintiff-appellant
household, causing them to detach and replace the meter. It held as unbelievable that Sesbreño further claimed that the items allegedly stolen by Chuchie Garcia were part
the team forcibly entered the house through threats and intimidation; that they of the loot taken by defendants-appellees Constantino and Arcilla. Yet not once did
themselves turned the electric meter upside down in order to incriminate him for theft plaintiff-appellant Sesbreño or any of his witnesses mention that a conspiracy existed
of electricity, because the fact that the team and Sesbreño had not known each other between these people. Clearly, much like his other allegations, it is nothing more than
before then rendered it unlikely for the team to fabricate charges against him; and that an afterthought by plaintiff-appellant Sesbreño.
Sesbreño’s non-presentation of Chuchie Garcia left her allegation of her being forced
to sign the two documents by the team unsubstantiated. All in all, the allegations against defendants-appellees appear to be nothing more than
a put-on to save face. For the simple truth is that the inspection exposed plaintiff-
Decision of the CA appellant Sesbreño as a likely cheat and thief.

Sesbreño appealed, but the CA affirmed the RTC on March 10, 2003,8 holding xxxx
thusly:
Neither is this Court swayed by the testimonies of Baledio and Lopez. The lower
x x x. plaintiff-appellant Sesbreño’s account is simply too implausible or far-fetched court rightly described their testimonies as fraught by discrepancies and
to be believed. For one thing, the inspection on his household was just one of many inconsistencies on material points and even called Lopez a perjured witness. On the
others that the VOC Team had conducted in that subdivision. Yet, none but plaintiff- other hand, it is odd that plaintiff-appellant Sesbreño chose not to present the witness
appellant Sesbreño complained of the alleged acts of the VOC Team. Considering whose testimony was very crucial. But even though Chuchie Garcia never testified,
that there is no proof that they also perpetrated the same illegal acts on other her absence speaks volumes. Whereas plaintiff-appellant Sesbreño claimed that the
VOC Team forced her to sign two documents that made her appear to be his removing the COMPANY’S property in the event of the termination of the contract
authorized agent or representative, the latter claimed otherwise and that she also gave for any cause.
them permission to enter and search the house. The person most qualified to refute
the VOC Team’s claim is Chuchie Garcia herself. It is axiomatic that he who asserts a Sesbreño contends, however, that paragraph 9 did not give Constantino, Arcilla and
fact or claim must prove it. He cannot transfer that burden to the person against whom Balicha the blanket authority to enter at will because the only property VECO owned
he asserts such fact or claim. When certain evidence is suppressed, the presumption is in his premises was the meter; hence, Constantino and Arcilla should enter only the
that it will adversely affect the cause of the party suppressing it, should it come to garage. He denies that they had the right to enter the main portion of the house and
light. x x x inspect the various rooms and the appliances therein because those were not the
properties of VECO. He posits that Balicha, who was not an employee of VECO, had
Upon denial of his motion for reconsideration, Sesbreño appealed. no authority whatsoever to enter his house and conduct a search. He concludes that
their search was unreasonable, and entitled him to damages in light of their admission
Issue that they had entered and inspected his premises without a search warrant.

Was Sesbreño entitled to recover damages for abuse of rights? We do not accept Sesbreño’s conclusion. Paragraph 9 clothed the entire VOC team
with unquestioned authority to enter the garage to inspect the meter. The members of
Ruling the team obviously met the conditions imposed by paragraph 9 for an authorized
entry. Firstly, their entry had the objective of conducting the routine inspection of the
The appeal has no merit. meter. Secondly, the entry and inspection were confined to the garage where the
meter was installed. Thirdly, the entry was effected at around 4 o’clock p.m., a
Sesbreño’s main contention is that the inspection of his residence by the VOC team reasonable hour. And, fourthly, the persons who inspected the meter were duly
was an unreasonable search for being carried out without a warrant and for being authorized for the purpose by VECO.
allegedly done with malice or bad faith.
Although Balicha was not himself an employee of VECO, his participation was to
Before dealing with the contention, we have to note that two distinct portions of render police assistance to ensure the personal security of Constantino and Arcilla
Sesbreño’s residence were inspected by the VOS team – the garage where the electric during the inspection, rendering him a necessary part of the team as an authorized
meter was installed, and the main premises where the four bedrooms, living rooms, representative. Under the circumstances, he was authorized to enter considering that
dining room and kitchen were located. paragraph 9 expressly extended such authority to "properly authorized employees or
representatives" of VECO.
Anent the inspection of the garage where the meter was installed, the respondents
assert that the VOC team had the continuing authority from Sesbreño as the consumer It is true, as Sesbreño urges, that paragraph 9 did not cover the entry into the main
to enter his premises at all reasonable hours to conduct an inspection of the meter premises of the residence. Did this necessarily mean that any entry by the VOS team
without being liable for trespass to dwelling. The authority emanated from paragraph into the main premises required a search warrant to be first secured?
9 of the metered service contract entered into between VECO and each of its
consumers, which provided as follows: Sesbreño insists so, citing Section 2, Article III of the 1987 Constitution, the clause
guaranteeing the right of every individual against unreasonable searches and seizures,
9. The CONSUMER agrees to allow properly authorized employees or viz:
representatives of the COMPANY to enter his premises at all reasonable hours
without being liable to trespass to dwelling for the purpose of inspecting, installing, Section 2. The right of the people to be secure in their persons, houses, papers and
reading, removing, testing, replacing or otherwise disposing of its property, and/or effects against unreasonable searches and seizures of whatever nature and for any
purpose shall be inviolable, and no search warrant or warrant of arrest shall issue
except upon probable cause to be determined personally by the judge after It is worth noting that the VOC inspectors decided to enter the main premises only
examination under oath or affirmation of the complainant and the witnesses he may after finding the meter of Sesbreño turned upside down, hanging and its disc not
produce, and particularly describing the place to be searched and the persons or things rotating. Their doing so would enable them to determine the unbilled electricity
to be seized. consumed by his household. The circumstances justified their decision, and their
inspection of the main premises was a continuation of the authorized entry. There was
He states that a violation of this constitutional guaranty rendered VECO and its VOS no question then that their ability to determine the unbilled electricity called for them
team liable to him for damages by virtue of Article 32 (9) of the Civil Code, which to see for themselves the usage of electricity inside. Not being agents of the State,
pertinently provides: they did not have to first obtain a search warrant to do so.

Article 32. Any public officer or employee, or any private individual, who directly or Balicha’s presence participation in the entry did not make the inspection a search by
indirectly obstructs, defeats, violates or in any manner impedes or impairs any of the an agent of the State within the ambit of the guaranty. As already mentioned, Balicha
following rights and liberties of another person shall be liable to the latter for was part of the team by virtue of his mission order authorizing him to assist and
damages: escort the team during its routine inspection. Consequently, the entry into the main
premises of the house by the VOC team did not constitute a violation of the guaranty.
xxxx
Our holding could be different had Sesbreño persuasively demonstrated the
(9) The right to be secured in one’s person, house, papers, and effects against intervention of malice or bad faith on the part of Constantino and Arcilla during their
unreasonable searches and seizures; inspection of the main premises, or any excessiveness committed by them in the
course of the inspection. But Sesbreño did not. On the other hand, the CA correctly
x x x x. observed that the inspection did not zero in on Sesbreño’s residence because the other
houses within the area were similarly subjected to the routine inspection. This, we
Sesbreño’s insistence has no legal and factual basis. think, eliminated any notion of malice or bad faith.

The constitutional guaranty against unlawful searches and seizures is intended as a Clearly, Sesbreño did not establish his claim for damages if the respondents were not
restraint against the Government and its agents tasked with law enforcement. It is to guilty of abuse of rights. To stress, the concept of abuse of rights prescribes that a
be invoked only to ensure freedom from arbitrary and unreasonable exercise of State person should not use his right unjustly or in bad faith; otherwise, he may be liable to
power. The Court has made this clear in its pronouncements, including that made in another who suffers injury. The rationale for the concept is to present some basic
People v. Marti, viz: principles to be followed for the rightful relationship between human beings and the
stability of social order. Moreover, according to a commentator,22 "the exercise of
If the search is made upon the request of law enforcers, a warrant must generally be right ends when the right disappears, and it disappears when it is abused, especially to
first secured if it is to pass the test of constitutionality. However, if the search is made the prejudice of others[;] [i]t cannot be said that a person exercises a right when he
at the behest or initiative of the proprietor of a private establishment for its own and unnecessarily prejudices another." Article 19 of the Civil Code23 sets the standards to
private purposes, as in the case at bar, and without the intervention of police be observed in the exercise of one’s rights and in the performance of one’s duties,
authorities, the right against unreasonable search and seizure cannot be invoked for namely: (a) to act with justice; (b) to give everyone his due; and (c) to observe
only the act of private individual, not the law enforcers, is involved. In sum, the honesty and good faith. The law thereby recognizes the primordial limitation on all
protection against unreasonable searches and seizures cannot be extended to acts rights – that in the exercise of the rights, the standards under Article 19 must be
committed by private individuals so as to bring it within the ambit of alleged unlawful observed.
intrusion by the government.
Although the act is not illegal, liability for damages may arise should there be an jurisdiction. It is merely part of her administrative responsibilities as Executive Judge
abuse of rights, like when the act is performed without prudence or in bad faith. In of the Regional Trial Court of Cebu City, of which Judge Paredes is also a member.
order that liability may attach under the concept of abuse of rights, the following
elements must be present, to wit: (a) the existence of a legal right or duty, (b) which is Lastly, the Court finds nothing wrong if the writer of the decision in the CA refused
exercised in bad faith, and (c) for the sole intent of prejudicing or injuring another. to inhibit from participating in the resolution of the motion for reconsideration filed
There is no hard and fast rule that can be applied to ascertain whether or not the by Sesbrefio. The motion for her inhibition was grounded on suspicion of her bias
principle of abuse of rights is to be invoked. The resolution of the issue depends on and prejudice, but suspicion of bias and prejudice were not enough grounds for
the circumstances of each case. inhibition.

Sesbreño asserts that he did not authorize Baledio or Chuchie Garcia to let anyone Suffice it to say that the records are bereft of any indication that even suggested that
enter his residence in his absence; and that Baledio herself confirmed that the the Associate Justices of the CA who participated in the promulgation of the decision
members of the VOC team had intimidated her into letting them in. were tainted with bias against him.

The assertion of Sesbreño is improper for consideration in this appeal. The RTC and WHEREFORE, the Court DENIES the pet1t1on for review on certiorari; AFFIRMS
the CA unanimously found the testimonies of Sesbreño’s witnesses implausible the decision promulgated on March 10, 2003; and DIRECTS the petitioner to pay the
because of inconsistencies on material points; and even declared that the non- costs of suit.
presentation of Garcia as a witness was odd if not suspect. Considering that such
findings related to the credibility of the witnesses and their testimonies, the Court SO ORDERED.
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. Verily, a review that may tend to
supplant the findings of the trial court that had the first-hand opportunity to observe A.C. No. 4697 November 25, 2014
the demeanor of the witnesses themselves should be undertaken by the Court with
prudent hesitation. Only when Sesbreño could make a clear showing of abuse in their
appreciation of the evidence and records by the trial and the appellate courts should FLORENCIO A. SALADAGA, Complainant,
the Court do the unusual review of the factual findings of the trial and appellate vs.
courts. Alas, that showing was not made here.
ATTY. ARTURO B. ASTORGA, Respondent.
Nor should the Court hold that Sesbreño was denied due process by the refusal of the
trial judge to inhibit from the case. Although the trial judge had issued an order for x-----------------------x
his voluntary inhibition, he still rendered the judgment in the end in compliance with
the instruction of the Executive Judge, whose exercise of her administrative authority
on the matter of the inhibition should be respected. In this connection, we find to be A.C. No. 4728
apt the following observation of the CA, to wit:

x x x. Both Judge Paredes and Judge Priscila Agana serve the Regional Trial Court FLORENCIO A. SALADAGA, Complainant,
and are therefore of co-equal rank. The latter has no authority to reverse or modify the vs.
orders of Judge Paredes. But in ordering Judge Paredes to continue hearing the case, ATTY. ARTURO B. ASTORGA, Respondent.
Judge Agana did not violate their co-equal status or unilaterally increased her
DECISION (1) TCT No. T-662 was already cancelled by TCT No. T-3211 in the name of
Philippine National Bank (PNB) as early as November 17, 1972 after foreclosure
proceedings;
LEONARDO-DE CASTRO, J.:
(2) TCT No. T-3211 was cancelled by TCT No. T-7235 in the names of respondent
Membership in the legal profession is a high personal privilege burdened with and his wife on January 4, 1982 pursuant to a deed of sale dated March 27,1979
conditions, including continuing fidelity to the law and constant possession of moral between PNB and respondent;
fitness. Lawyers, as guardians of the law, play a vital role in the preservation of
society, and a consequent obligation of lawyers is to maintain the highest standards of (3) Respondent mortgaged the subject property to RBAI on March 14, 1984, RBAI
ethical conduct. Failure to live by the standards of the legal profession and to foreclosed on the property, and subsequently obtained TCT No. TP-10635 on March
discharge the burden of the privilege conferred on one as a member of the bar warrant 27, 1991. Complainant was subsequently dispossessed of the property by RBAI.
the suspension or revocation of that privilege.
Aggrieved, complainant instituted a criminal complaint for estafa against respondent
The Factual Antecedents with the Office of the Provincial Prosecutor of Leyte, docketed as I.S. No. 95-144.
The Provincial Prosecutor of Leyte approved the Resolution dated April 21, 1995 in
Complainant Florencio A. Saladaga and respondent Atty. Arturo B. Astorga entered I.S. No. 95-144 finding that "[t]he facts of [the] case are sufficient to engender a well-
into a "Deed of Sale with Right to Repurchase" on December 2, 1981 where founded belief that Estafa x x x has been committed and that respondent herein is
respondent sold (with right of repurchase) to complainant a parcel of coconut land probably guilty thereof." Accordingly, an Information dated January 8,1996 was filed
located at Barangay Bunga, Baybay, Leyte covered by Transfer Certificate of Title before the Municipal Trial Court (MTC) of Baybay, Leyte, formally charging
(TCT) No. T-662 for ₱15,000.00. Under the said deed, respondent represented that he respondent with the crime of estafa under Article 316, paragraphs 1 and 2 of the
has "the perfect right to dispose as owner in fee simple" the subject property and that Revised Penal Code, committed as follows:
the said property is "free from all liens and encumbrances." The deed also provided
that respondent, as vendor a retro, had two years within which to repurchase the On March 14, 1984, accused representing himself as the owner of a parcel of land
property, and if not repurchased within the said period, "the parties shall renew [the] known as Lot No. 7661 of the Baybay Cadastre, mortgaged the same to the Rural
instrument/agreement." Bank of Albuera, Albuera, Leyte, within the jurisdiction of this Honorable Court,
knowing fully well that the possessor and owner at that time was private complainant
Respondent failed to exercise his right of repurchase within the period provided in the Florencio Saladaga by virtue of a Pacto de Retro Sale which accused executed in
deed, and no renewal of the contract was made even after complainant sent favor of private complainant on 2nd December, 1981, without first
respondent a final demand dated May 10, 1984 for the latter to repurchase the redeeming/repurchasing the same. [P]rivate complainant knowing of accused[’s]
property. Complainant remained in peaceful possession of the property until unlawful act only on or about the last week of February, 1991 when the rural bank
December 1989 when he received letters from the Rural Bank of Albuera (Leyte), dispossessed him of the property, the mortgage having been foreclosed, private
Inc. (RBAI) informing him that the property was mortgaged by respondent to RBAI, complainant thereby suffered damages and was prejudiced by accused[’s] unlawful
that the bank had subsequently foreclosed on the property, and that complainant transaction and misrepresentation.
should therefore vacate the property.
The aforementioned estafa case against respondent was docketed as Criminal Case
Complainant was alarmed and made an investigation. He learned the following: No. 3112-A.

Complainant likewise instituted the instant administrative cases against respondent by

filing before this Court an Affidavit-Complaint dated January 28, 1997 and
Supplemental Complaint dated February 27, 1997, which were docketed as A.C. No. the practice of law for two years, with warning that a similar misdeed in the future
4697 and A.C. No. 4728, respectively. In both complaints, complainant sought the shall be dealt with more severity, and (2) ordered to return the sum of ₱15,000.00
disbarment of respondent. received in consideration of the pacto de retrosale, with legal interest.

The administrative cases were referred to the Integrated Bar of the Philippines (IBP) The Court’s Ruling
for investigation, report and recommendation.
The Court agrees with the recommendation of the IBP Board of Governors to suspend
In his Consolidated Answer dated August 16, 2003 filed before the IBP, respondent respondent from the practice of law for two years, but it refrains from ordering
denied that his agreement with complainant was a pacto de retrosale. He claimed that respondent to return the ₱15,000.00 consideration, plus interest.
it was an equitable mortgage and that, if only complainant rendered an accounting of
his benefits from the produce of the land, the total amount would have exceeded Respondent does not deny executing the "Deed of Sale with Right to Repurchase"
₱15,000.00. dated December 2, 1981 in favor of complainant. However, respondent insists that the
deed is not one of sale with pacto de retro, but one of equitable mortgage. Thus,
Report and Recommendation of the Investigating Commissioner and Resolution of respondent argues that he still had the legal right to mortgage the subject property to
the IBP Board of Governors other persons. Respondent additionally asserts that complainant should render an
accounting of the produce the latter had collected from the said property, which
In a Report and Recommendation dated April 29, 2005, the Investigating would already exceed the ₱15,000.00 consideration stated in the deed.
Commissioner of the IBP’s Commission on Bar Discipline found that respondent was
in bad faith when he dealt with complainant and executed the "Deed of Sale with There is no merit in respondent’s defense.
Right to Repurchase" but later on claimed that the agreement was one of equitable
mortgage. Respondent was also guilty of deceit or fraud when he represented in the Regardless of whether the written contract between respondent and complainant is
"Deed of Sale with Right to Repurchase" dated December 2, 1981 that the property actually one of sale with pacto de retro or of equitable mortgage, respondent’s
was covered by TCT No. T-662, even giving complainant the owner’s copy of the actuations in his transaction with complainant, as well as in the present administrative
said certificate of title, when the said TCT had already been cancelled on November cases, clearly show a disregard for the highest standards of legal proficiency,
17, 1972 by TCT No. T-3211 in the name of Philippine National Bank (PNB). morality, honesty, integrity, and fair dealing required from lawyers, for which
Respondent made matters even worse, when he had TCT No. T-3211 cancelled with respondent should be held administratively liable.
the issuance of TCT No. T-7235 under his and his wife’s name on January 4,1982
without informing complainant. This was compounded by respondent’s subsequent When respondent was admitted to the legal profession, he took an oath where he
mortgage of the property to RBAI, which led to the acquisition of the property by undertook to "obey the laws," "do no falsehood," and "conduct [him]self as a lawyer
RBAI and the dispossession thereof of complainant. Thus, the Investigating according to the best of [his] knowledge and discretion." He gravely violated his oath.
Commissioner recommended that respondent be (1) suspended from the practice of
law for one year, with warning that a similar misdeed in the future shall be dealt with The Investigating Commissioner correctly found, and the IBP Board of Governors
more severity, and (2) ordered to return the sum of ₱15,000.00, the amount he rightly agreed, that respondent caused the ambiguity or vagueness in the "Deed of
received as consideration for the pacto de retrosale, with interest at the legal rate. Sale with Right to Repurchase" as he was the one who prepared or drafted the said
instrument. Respondent could have simply denominated the instrument as a deed of
Considering respondent’s "commission of unlawful acts, especially crimes involving mortgage and referred to himself and complainant as "mortgagor" and "mortgagee,"
moral turpitude, acts of dishonesty, grossly immoral conduct and deceit," the IBP respectively, rather than as "vendor a retro" and "vendee a retro." If only respondent
Board of Governors adopted and approved the Investigating Commissioner’s Report had been more circumspect and careful in the drafting and preparation of the deed,
and Recommendation with modification as follows: respondent is(1) suspended from then the controversy between him and complainant could have been avoided or, at the
very least, easily resolved. His imprecise and misleading wording of the said deed on wrong statement in the deed when he was subsequently issued a new copy of TCT
its face betrayed lack of legal competence on his part. He thereby fell short of his oath No. T-7235 on January 4, 1982, or barely a month after the execution of the said
to "conduct [him]self as a lawyer according to the best of [his] knowledge and deed. All told, respondent clearly committed an act of gross dishonesty and deceit
discretion." against complainant.

More significantly, respondent transgressed the laws and the fundamental tenet of Canon 1 and Rule 1.01 of the Code of Professional Responsibility provide:
human relations as embodied in Article 19 of the Civil Code:
CANON 1 – A lawyer shall uphold the constitution, obey the laws of the land and
Art. 19. Every person must, in the exercise of his rights and in the performance of his promote respect for law and legal processes.
duties, act with justice, give everyone his due, and observe honesty and good faith.
Rule 1.01 – A lawyer shall not engage in unlawful, dishonest, immoral or deceitful
Respondent, as owner of the property, had the right to mortgage it to complainant but, conduct. Under Canon 1, a lawyer is not only mandated to personally obey the laws
as a lawyer, he should have seen to it that his agreement with complainant is and the legal processes, he is moreover expected to inspire respect and obedience
embodied in an instrument that clearly expresses the intent of the contracting parties. thereto. On the other hand, Rule 1.01 states the norm of conduct that is expected of all
A lawyer who drafts a contract must see to it that the agreement faithfully and clearly lawyers.
reflects the intention of the contracting parties. Otherwise, the respective rights and
obligations of the contracting parties will be uncertain, which opens the door to legal Any act or omission that is contrary to, prohibited or unauthorized by, in defiance of,
disputes between the said parties. Indeed, the uncertainty caused by respondent’s poor disobedient to, or disregards the law is "unlawful." "Unlawful" conduct does not
formulation of the "Deed of Sale with Right to Repurchase" was a significant factor necessarily imply the element of criminality although the concept is broad enough to
in the legal controversy between respondent and complainant. Such poor formulation include such element.
reflects at the very least negatively on the legal competence of respondent.
To be "dishonest" means the disposition to lie, cheat, deceive, defraud or betray; be
Under Section 63 of the Land Registration Act, the law in effect at the time the PNB untrustworthy; lacking in integrity, honesty, probity, integrity in principle, fairness
acquired the subject property and obtained TCT No. T-3211 in its name in 1972, and straightforwardness. On the other hand, conduct that is "deceitful" means as
where a decree in favor of a purchaser who acquires mortgaged property in follows:
foreclosure proceedings becomes final, such purchaser becomes entitled to the
issuance of a new certificate of title in his name and a memorandum thereof shall be [Having] the proclivity for fraudulent and deceptive misrepresentation, artifice or
"indorsed upon the mortgagor’s original certificate."20 TCT No. T-662, which device that is used upon another who is ignorant of the true facts, to the prejudice and
respondent gave complainant when they entered into the "Deed of Sale with Right to damage of the party imposed upon. In order to be deceitful, the person must either
Repurchase" dated December 2, 1981, does not bear such memorandum but only a have knowledge of the falsity or acted in reckless and conscious ignorance thereof,
memorandum on the mortgage of the property to PNB in 1963 and the subsequent especially if the parties are not on equal terms, and was done with the intent that the
amendment of the mortgage. aggrieved party act thereon, and the latter indeed acted in reliance of the false
statement or deed in the manner contemplated to his injury. The actions of respondent
Respondent dealt with complainant with bad faith, falsehood, and deceit when he in connection with the execution of the "Deed of Sale with Right to Repurchase"
entered into the "Deed of Sale with Right to Repurchase" dated December 2, 1981 clearly fall within the concept of unlawful, dishonest, and deceitful conduct. They
with the latter. He made it appear that the property was covered by TCT No. T-662 violate Article 19 of the Civil Code. They show a disregard for Section 63 of the
under his name, even giving complainant the owner’s copy of the said certificate of Land Registration Act. They also reflect bad faith, dishonesty, and deceit on
title, when the truth is that the said TCT had already been cancelled some nine years respondent’s part. Thus, respondent deserves to be sanctioned.
earlier by TCT No. T-3211 in the name of PNB. He did not even care to correct the
Respondent’s breach of his oath, violation of the laws, lack of good faith, and Rule 12.03 – A lawyer shall not, after obtaining extensions of time to file pleadings,
dishonesty are compounded by his gross disregard of this Court’s directives, as well memoranda or briefs, let the period lapse without submitting the same or offering an
as the orders of the IBP’s Investigating Commissioner (who was acting as an agent of explanation for his failure to do so.
this Court pursuant to the Court’s referral of these cases to the IBP for investigation,
report and recommendation), which caused delay in the resolution of these Rule 12.04 – A lawyer shall not unduly delay a case, impede the execution of a
administrative cases. judgment or misuse court processes.

In particular, the Court required respondent to comment on complainant’s Affidavit- Respondent’s infractions are aggravated by the fact that he has already been imposed
Complaint in A.C. No. 4697 and Supplemental Complaint in A.C. No. 4728 on a disciplinary sanction before. In Nuñez v. Atty. Astorga, respondent was held liable
March 12, 1997 and June 25, 1997, respectively. While he requested for several for conduct unbecoming an attorney for which he was fined ₱2,000.00.
extensions of time within which to submit his comment, no such comment was
submitted prompting the Court to require him in a Resolution dated February 4,1998 Given the foregoing, the suspension of respondent from the practice of law for two
to (1) show cause why he should not be disciplinarily dealt with or held in contempt years, as recommended by the IBP Board of Governors, is proper.
for such failure, and (2) submit the consolidated comment. Respondent neither
showed cause why he should not be disciplinarily dealt with or held in contempt for The Court, however, will not adopt the recommendation of the IBP to order
such failure, nor submitted the consolidated comment. respondent to return the sum of ₱15,000.00 he received from complainant under the
"Deed of Sale with Right to Repurchase." This is a civil liability best determined and
When these cases were referred to the IBP and during the proceedings before the awarded in a civil case rather than the present administrative cases.
IBP’s Investigating Commissioner, respondent was again required several times to
submit his consolidated answer. He only complied on August 28, 2003, or more than In Roa v. Moreno, the Court pronounced that "[i]n disciplinary proceedings against
six years after this Court originally required him to do so. The Investigating lawyers, the only issue is whether the officer of the court is still fit to be allowed to
Commissioner also directed the parties to submit their respective position papers. continue as a member of the Bar. Our only concern is the determination of
Despite having been given several opportunities to submit the same, respondent did respondent’s administrative liability. Our findings have no material bearing on other
not file any position paper. judicial action which the parties may choose to file against each other. "While the
respondent lawyer’s wrongful actuations may give rise at the same time to criminal,
Respondent’s disregard of the directives of this Court and of the Investigating civil, and administrative liabilities, each must be determined in the appropriate case;
Commissioner, which caused undue delay in these administrative cases, contravenes and every case must be resolved in accordance with the facts and the law applicable
the following provisions of the Code of Professional Responsibility: and the quantum of proof required in each. Section 5, in relation to Sections 1 and 2,
Rule 1 of the Rules of Court states that in administrative cases, such as the ones at
CANON 11 – A lawyer shall observe and maintain the respect due to the courts and bar, only substantial evidence is required, not proof beyond reasonable doubt as in
to judicial officers and should insist on similar conduct by others. criminal cases, or preponderance of evidence as in civil cases. Substantial evidence is
that amount of relevant evidence which a reasonable mind might accept as adequate
xxxx to justify a conclusion.

CANON 12 – A lawyer shall exert every effort and consider it his duty to assist in the The Court notes that based on the same factual antecedents as the present
speedy and efficient administration of justice. administrative cases, complainant instituted a criminal case for estafa against
respondent, docketed as Criminal Case No. 3112-A, before the MTC. When a
xxxx criminal action is instituted, the civil action for the recovery of civil liability arising
from the offense charged shall be deemed instituted with the criminal action unless
the offended party waives the civil action, reserves the right to institute it separately This is a Petition for Review filed by Coca-Cola Bottlers Philippines, Inc.
or institutes the civil action prior to the criminal action. Unless the complainant (petitioner), from the Court of Appeals (CA) Decision and Resolution in CA-GR. CV
waived the civil action, reserved the right to institute it separately, or instituted the No. 91096. The CA affirmed in toto the Decision of Regional Trial Court (RTC)
civil action prior to the criminal action, then his civil action for the recovery of civil Branch 88 in Quezon City in Civil Case No. Q-00-42320.
liability arising from the estafa committed by respondent is deemed instituted with
Criminal Case No. 3112-A. The civil liability that complainant may recover in This case originated from the claim for damages filed by respondent spouses Jose and
Criminal Case No. 3112-A includes restitution; reparation of the damage caused him; Lilibeth Bernardo (respondents) against petitioner for violation of Articles 19, 20, 21,
and/or indemnification for consequential damages, which may already cover the and 28 of the Civil Code. The RTC found petitioner liable to pay respondents
₱15,000.00 consideration complainant had paid for the subject property. temperate damages in the amount of P500,000 for loss of goodwill, to be offset
against the latter's outstanding balance for deliveries in the amount of P449,154. The
WHEREFORE, respondent is hereby found GUILTY of the following: breach of the trial court ordered petitioner to pay P50,000 as moral damages, P20,000 as exemplary
Lawyer’s Oath; unlawful, dishonest, and deceitful conduct; and disrespect for the damages, and P100,000 as attorney's fees.
Court and causing undue delay of these cases, for which he is SUSPENDED from the
practice of law for a period of two (2) years, reckoned from receipt of this Decision, Petitioner asserts that the Complaint had no basis, and that the trial court had no
with WARNING that a similar misconduct in the future shall be dealt with more jurisdiction to award temperate damages in an amount equivalent to the outstanding
severely. obligation of respondents. It prays not only for the reversal of the assailed judgments,
but also for an award of moral and exemplary damages, as well as attorney's fees and
Let a copy of this Decision be furnished the Office of the Bar Confidant and the litigation expenses. It also asks that respondents be ordered to pay P449,154 plus
Integrated Bar of the Philippines for their information and guidance. The Court legal interest from the date of demand until full payment.
Administrator is directed to circulate this Decision to all courts in the country.
We deny the Petition.
SO ORDERED.
FACTS
G.R. No. 190667, November 07, 2016
Petitioner is a domestic corporation engaged in the large-scale manufacture, sale, and
distribution of beverages around the country. On the other hand, respondents, doing
COCA-COLA BOTTLERS PHILIPPINES, INC., business under the name "Jolly Beverage Enterprises," are wholesalers of softdrinks
Petitioner, v. SPOUSES JOSE R. BERNARDO AND in Quezon City, particularly in the vicinities of Bulacan Street, V. Luna Road,
Katipunan Avenue, and Timog Avenue.
LILIBETH R. BERNARDO, DOING BUSINESS UNDER
THE NAME AND STYLE "JOLLY BEVERAGE The business relationship between the parties commenced in 1987 when petitioner
ENTERPRISES," Respondents. designated respondents as its distributor. On 22 March 1994, the parties formally
entered into an exclusive dealership contract for three years. Under the Agreement,
petitioner would extend developmental assistance to respondents in the form of cash
DECISION assistance and trade discount incentives. For their part, respondents undertook to sell
petitioner's products exclusively, meet the sales quota of 7,000 cases per month, and
assist petitioner in its marketing efforts.
SERENO, C.J.:
On 1 March 1997, the parties executed a similar agreement for another two years, or implemented only after the expiration of the Agreements. It opined that the filing of
until 28 February 1999. This time, petitioner gave respondents complimentary cases the complaint was a mere ploy resorted to by respondents to evade the payment of the
of its products instead of cash assistance, and increased the latter's sales quota to deliveries.
8,000 cases per month.
The RTC held petitioner liable for damages for abuse of rights in violation of Articles
For 13 years, the parties enjoyed a good and harmonious business partnership. While 19, 20, and 21 of the Civil Code and for unfair competition under Article 28. It found
the contracts contained a clause for breach, it was never enforced. that petitioner's agents solicited the list of clients in order to penetrate the market and
directly supply customers with its products. Moreover, the trial court found that
Sometime in late 1998 or early 1999, before the contract expired, petitioner required petitioner had recklessly ignored the rights of respondents to have a fair chance to
respondents to submit a list of their customers on the pretext that it would formulate a engage in business or earn a living when it deliberately used oppressive methods to
policy defining its territorial dealership in Quezon City. It assured respondents that deprive them of their business. Its officers were, however, absolved of liability, as
their contract would be renewed for a longer period, provided that they would submit there was no showing that they had acted in their individual and personal capacities.
the list. However, despite their compliance, the promise did not materialize.
In the body of its Decision, the RTC stated that petitioner should pay respondents
Respondents discovered that in February 1999, petitioner started to reach out to the P500,000 as temperate damages, and that it was only just and fair that the latter offset
persons whose names were on the list. Respondents also received reports that their this amount against their outstanding obligation to petitioner in the amount of
delivery trucks were being trailed by petitioner's agents; and that as soon as the trucks P449,154. In the fallo, the trial court awarded P50,000 as moral damages, P20,000 as
left, the latter would approach the former's customers. Further, respondents found out exemplary damages, and P100,000 as attorney's fees. It denied petitioner's
that petitioner had employed a different pricing scheme, such that the price given to counterclaim for damages for lack of factual and legal basis. Petitioner moved for
distributors was significantly higher than that given to supermarkets. It also enticed reconsideration, but the motion was denied.
direct buyers and sari-sari store owners in the area with its "Coke Alok" promo, in
which it gave away one free bottle for every case purchased. It further engaged a store Petitioner then elevated the case to the CA, which affirmed the RTC Decision in toto.
adjacent to respondents' warehouse to sell the former's products at a substantially According to the appellate court's ruling, petitioner had used its sizable resources to
lower price. railroad the business of respondents:
[Petitioner] infiltrated certain areas in Quezon City at the expense of and later, in
Respondents claimed that because of these schemes, they lost not only their major derogation of its wholesalers, particularly [respondents]. As admitted by Allan
customers - such as Peach Blossoms, May Flower Restaurant, Saisaki Restaurant, and Mercado, the Integrated Selling and Marketing Manager of appellant, it was
Kim Hong Restaurant but also small stores, such as the canteen in the hospital where previously dependent on wholesalers to circulate its products around the country. x x
respondent Jose Bernardo worked. They admitted that they were unable to pay x.
deliveries worth P449,154.
xxxx
Respondents filed a Complaint for damages, alleging that the acts of petitioner
constituted dishonesty, bad faith, gross negligence, fraud, and unfair competition in [T]owards the end of the partnership, appellant employed a different marketing
commercial enterprise. The Complaint was later amended to implead petitioner's scheme purportedly to obviate the poor dealership management from wholesalers in
officers and personnel, include additional factual allegations, and increase the amount major areas. But as may be shown by the incidents leading to the filing of this case,
of damages prayed for. this method was designed strategically to overrun [respondents'] business and take
over the customers of its wholesalers.
Petitioner denied the allegations. It maintained that it had obtained a list of clients
through surveys, and that promotional activities or developmental strategies were xxxx
 Petitioner argues that the trial court had no jurisdiction to award temperate damages
One such method was "different pricing schemes" wherein the prices given to that were not prayed for in the Complaint. It further asserts that it did not violate
supermarkets and grocery stores were considerably lower than those imposed on Articles 19, 20, 21 or 28; hence, the award of damages and attorney's fees was
wholesalers. No prior advice thereof was given to [respondents] or any of the improper.
wholesalers. In fact, they only knew of it when their customers began complaining
about the variation in prices of softdrinks sold in supermarkets and those that were OUR RULING
sold by them. When in fact [respondent] Bernardo personally inspected the products
in grocery stores, he discovered that a box of Coke-in-can is sold at P40.00, lower The CA did not err in affirming the finding that petitioner was liable for temperate,
than those offered by them as wholesalers. moral and exemplary damages, as well as attorney's fees, for abuse of rights and
unfair competition.
About the same time, [petitioner] also implemented the "Area Market Cooperatives"
(AMC) and the "Coke-Alok" promo. Under the AMC, customers of wholesalers can The Petition raises questions of fact.
purchase [petitioner's] products from prominent stores in heavily crowded areas for
P76.00 per case, as opposed to [respondent's] offering of P112.00. In "Coke-Alok," Petitioner ignores the nature of a petition for review as a remedy against errors of law.
[petitioner] directly sold Coke products to wholesale customers with incentives as Instead, it raises factual matters that have already been passed upon by the RTC and
free bottle of Coke for every case of softdrinks purchased. Being of limited resources, the CA.
[respondents had no] means to equal the lucrative incentives given by [petitioner] to
their customers. It insists on the following facts: 1) the "promotional activities" were implemented
after the dealership agreements expired; 2) the "developmental strategies" were
xxxx implemented nationwide and were not meant to destroy the business of respondents;
3) its agents did not follow the trucks of Jolly Beverages; 4) the price difference
Apart from direct selling and other promotions, [petitioner] also employed high- resulted because respondents could no longer avail of trade discounts and incentives
handed means that further shrunk [respondents'] market coverage. In one instance, under the expired Agreement; and 5) there is no causal connection between the
[petitioner's sales representative] advised [respondents] and other wholesalers to keep promotional activities and the claimed losses of respondents.
away from major thoroughfares. Apparently, [petitioner] was going to supply their
products to these stores themselves. x x x. Petitioner contends that since it did not assign any exclusive territory to respondents,
the latter had no exclusive right to any customer. It supposedly decided to rely on its
xxxx own sales personnel to push the sale of its products, because the distributors had
violated the terms of their agreements by selling competing products, failing to meet
x x x Furthermore, one of [petitioner's] representatives, Nelson Pabulayan, admitted the required sales volume, or failing to pay on time. Petitioner, however, did not
that he sold products at the canteen in V. Luna Hospital [which was then being allege that respondents committed any of these actions during the existence of the
serviced by respondents]. agreement.

As if that was not enough, petitioner engaged other stores, such as Freezel's Bakeshop We have repeatedly held that factual findings of the trial court, especially when
that was located adjacent to [respondent's] warehouse, to sell Coke products at a price affirmed by the appellate court, are given great weight, even finality, by this Court.
substantially lower than [that offered by respondents]. Petitioner fails to make a convincing argument that this case falls under any of the
exceptions to the rule. On the contrary, the Decisions of the RTC and the CA appear
ISSUES to be supported by the records.
Petitioner bewails the fact that the RTC and the CA, in establishing the facts, relied Art. 21. Any person who willfully causes loss or injury to another in a manner that is
heavily on the testimony of respondent Jose Bernardo. contrary to morals, good customs or public policy shall compensate the latter for the
damage.
Petitioner, however, forgets that trial courts are in an ideal position to observe the In Albenson Enterprises Corp. v. CA, this Court held that under any of the above
demeanor of the witnesses and can therefore discern if the latter are telling the truth provisions of law, an act that causes injury to another may be made the basis for an
or not. In this case, both the trial and the appellate courts found the testimonies of award of damages. As explained by this Court in GF Equity, Inc. v. Valenzona:
respondent Jose Bernardo and his witnesses more credible than those of the witnesses The exercise of a right ends when the right disappears; and it disappears when it is
presented by petitioners. We shall not substitute our judgment for that of the trial abused, especially to the prejudice of others. The mask of a right without the spirit of
court, absent any compelling reason. justice which gives it life is repugnant to the modern concept of social law. It cannot
be said that a person exercises a right when he unnecessarily prejudices another or
Petitioner is liable for damages for abuse of rights and unfair competition under the offends morals or good customs. Over and above the specific precepts of positive law
Civil Code. are the supreme norms of justice which the law develops and which are expressed in
three principles: honeste vivere, alterum non laedere and jus suum quique tribuere;
Both the RTC and the CA found that petitioner had employed oppressive and high- and he who violates them violates the law. For this reason, it is not permissible to
handed schemes to unjustly limit the market coverage and diminish the investment abuse our rights to prejudice others.
returns of respondents. The CA summarized its findings as follows: Meanwhile, the use of unjust, oppressive, or high-handed business methods resulting
This [cut-throat competition] is precisely what appellant did in order to take over the in unfair competition also gives a right of action to the injured party. Article 28 of the
market: directly sell its products to or deal them off to competing stores at a price Civil Code provides:
substantially lower than those imposed on its wholesalers. As a result, the wholesalers Art. 28. Unfair competition in agricultural, commercial or industrial enterprises or in
suffered losses, and in [respondents'] case, laid off a number of employees and labor through the use of force, intimidation, deceit, machination or any other unjust,
alienated the patronage of its major customers including small-scale stores. oppressive or highhanded method shall give rise to a right of action by the person
It must be emphasized that petitioner is not only a beverage giant, but also the who thereby sutlers damage.
manufacturer of the products; hence, it sets the price. In addition, it took advantage of Petitioner cites Tolentino, who in turn cited Colin and Capitant. According to the
the information provided by respondents to facilitate its takeover of the latter's usual latter, the act of "a merchant [who] puts up a store near the store of another and in this
business area. Distributors like respondents, who had assisted petitioner in its way attracts some of the latter's patrons" is not an abuse of a right. The scenario in the
marketing efforts, suddenly found themselves with fewer customers. Other present case is vastly different: the merchant was also the producer who, with the use
distributors were left with no choice but to fold. of a list provided by its distributor, knocked on the doors of the latter's customers and
offered the products at a substantially lower price. Unsatisfied, the merchant even
Articles 19, 20, and 21 of the Civil Code provide the legal bedrock for the award of sold its products at a preferential rate to another store within the vicinity.
damages to a party who suffers damage whenever another person commits an act in Jurisprudence holds that when a person starts an opposing place of business, not for
violation of some legal provision; or an act which, though not constituting a the sake of profit, but regardless of loss and for the sole purpose of driving a
transgression of positive law, nevertheless violates certain rudimentary rights of the competitor out of business, in order to take advantage of the effects of a malevolent
party aggrieved. The provisions read: purpose, that person is guilty of a wanton wrong.
Art. 19. Every person must, in the exercise of his rights and in the performance of his
duties, act with justice, give everyone his due, and observe honesty and good faith. Temperate, moral, and exemplary damages, as well as attorney's fees, were properly
awarded.
Art. 20. Every person who, contrary to law, willfully or negligently causes damage to
another, shall indemnify the latter for the same.
Petitioner argues that the trial court did not have jurisdiction to grant an award of In this case, both the RTC and the CA found that respondents had similarly suffered
temperate damages, because respondents did not specifically pray for it in their pecuniary loss by reason of petitioner's high-handed machinations to eliminate
Amended Complaint: competition in the market.
WHEREFORE, premises considered, it is most respectfully prayed that the
Honorable Court render a judgment directing defendants to: We see no grave error on the part of the RTC when it ruled that the unpaid obligation
Pay plaintiffs the amount of P1,000,000.00 representing loss of goodwill nurtured of respondents shall be offset against the temperate damages due them from
over the past 13 years as actual damages. petitioner. However, the trial court was not accurate in considering the P500,000
temperate damages as adequate to completely extinguish the obligation of
Pay plaintiffs the amount of P200,000 representing moral damages. respondents to petitioner. We note that while the principal was P449,154, this amount
earned legal interest from the time of demand. Nonetheless, in view of the established
Pay plaintiffs the amount of P100,000 representing exemplary damages. fact that respondents incurred the losses after their business was systematically
crippled by petitioner, it is only proper and just that the obligation, as well as the legal
Pay plaintiffs the amount of P100,000 representing attorney's fees. interest that has accrued, be deemed totally compensated by the temperate damages.
Therefore, respondents do not need to tender the amount of P449,154 plus legal
Other reliefs which are just and equitable under the premises are also prayed for. interest to petitioner, while the latter does not have to tender any amount as temperate
damages to the former.
Petitioner's argument is flimsy and unsupported even by the cases it has cited. The
CA correctly ruled that the award of temperate damages was justified, even if it was With regard to moral damages, petitioner argues that respondents failed to provide
not specifically prayed for, because 1) respondents did pray for the grant of "other satisfactory proof that the latter had undergone any suffering or injury. This is a
reliefs," and 2) the award was clearly warranted under the circumstances. Indeed, the factual question that has been resolved by the trial court in a Decision affirmed by the
law permits judges to award a different kind of damages as an alternative to actual CA. The award finds legal basis under Article 2219(10) of the Civil Code, which
damages: states that moral damages may be recovered in acts and actions referred to in Articles
21 and 28.
Civil Code, Art. 2224. Temperate or moderate damages, which are more than nominal
but less than compensatory damages, may be recovered when the court finds that Petitioner likewise questions the award of exemplary damages without "competent
some pecuniary loss has been suffered but its amount cannot, from the nature of the proof." It cites Spouses Villafuerte v. CA as basis for arguing that the CA should have
case, be provided with certainty. (Emphasis supplied) based its Decision regarding the fact and the amount of exemplary damages upon
Compensatory damages may be awarded in the concept of temperate damages for competent proof that respondents have suffered injury and upon evidence of the
injury to business reputation or business standing, loss of goodwill, and loss of actual amount thereof. We enjoin petitioner's counsel to fully and carefully read the
customers who shifted their patronage to competitors. text of our decisions before citing them as authority. The excerpt lifted pertains to
compensatory damages, not exemplary damages. We remind counsel that exemplary
It is not extraordinary for courts to award temperate damages in lieu of actual damages are awarded under Article 2229 of the Civil Code by way of example or
damages. In Canada v. All Commodities Marketing Corporation, this Court awarded correction for the public good. The determination of the amount is left to the
temperate damages in recognition of the pecuniary loss suffered, after finding that discretion of the judge; its proof is not incumbent upon the claimant.
actual damages could not be awarded for lack of proof. In Public Estates Authority v.
Chu, this Court held that temperate damages should have been awarded by the trial There being no meritorious argument raised by petitioner, the award of exemplary
court considering that the plaintiff therein had suffered some pecuniary loss. damages must be sustained to caution powerful business owners against the use of
oppressive and high-handed commercial strategies to target and trample on the rights
of small business owners, who are striving to make a decent living.
 LWV CONSTRUCTION CORPORATION, Respondent.
Exemplary damages having been awarded, the grant of attorney's fees was therefore
warranted.
DECISION
Petitioner's counterclaims for moral and exemplary damages, as well as attorney's
fees and litigation expenses, were properly denied.
PERLAS-BERNABE, J.:
The counterclaim for the payment of P449,154 plus legal interest was effectively
granted when the trial court offset the temperate damages awarded to respondents Assailed in this petition for review on certiorari are the Decision dated July 11, 2014
against the outstanding obligation of the latter to petitioner. and the Resolution dated February 27, 2015 of the Court of Appeals (CA) in CA-G.R.
SP No. 125451, which affirmed with modification the Decision dated December 15,
The counterclaims for moral and exemplary damages, as well as attorney's fees and 2011 and the Order dated May 25, 2012 of the Regional Trial Court of Mandaluyong
litigation expenses, had no basis and were properly denied. The fact that petitioner City, Branch 211 (RTC) in SCA Case No. MC11-879 (Civil Case No. 21881), and
was compelled to engage the services of counsel in order to defend itself against the thereby ordered herein petitioner St. Martin Polyclinic, Inc. (petitioner) to pay
suit of respondents did not entitle it to attorney's fees. respondent LWV Construction Corporation (respondent) temperate damages in the
amount of P50,000.00.
According to petitioner, it is entitled to moral damages, because "respondents clearly
acted in a vexatious manner when they instituted this suit." We see nothing in the The Facts
record to sustain this argument.
Respondent is engaged in the business of recruiting Filipino workers for deployment
With respect to the prayer for exemplary damages, neither do we find any act of to Saudi Arabia. On the other hand, petitioner is an accredited member of the Gulf
respondents that has to be deterred. Cooperative Council Approved Medical Centers Association (GAMCA) and as such,
authorized to conduct medical examinations of prospective applicants for overseas
WHEREFORE, the Petition is DENIED. The Decision dated 23 July 2009 and employment.
Resolution dated 19 November 2009 rendered by the Court of Appeals in CA-G.R.
CV No. 91096, which affirmed in toto the Decision dated 28 September 2007 issued On January 10, 2008, respondent referred prospective applicant Jonathan V.
by Regional Trial Court Branch 88 Quezon City in Civil Case No. Q-00-42320, are Raguindin (Raguindin) to petitioner for a pre-deployment medical examination in
hereby AFFIRMED with MODIFICATION in that the damages awarded shall earn accordance with the instructions from GAMCA. After undergoing the required
legal interest of 6% per annum from the date of finality of this Decision until its full examinations, petitioner cleared Raguindin and found him "fit for employment," as
satisfaction. The total compensation of respondents' unpaid obligation, including legal evidenced by a Medical Report dated January 11, 2008 (Medical Report).
interest that has accrued, and the temperate damages awarded to them, is hereby
upheld. Based on the foregoing, respondent deployed Raguindin to Saudi Arabia, allegedly
incurring expenses in the amount of P84,373.41. Unfortunately, when Raguindin
SO ORDERED. underwent another medical examination with the General Care Dispensary of Saudi
Arabia (General Care Dispensary) on March 24, 2008, he purportedly tested positive
for HCV or the hepatitis C virus. The Ministry of Health of the Kingdom of Saudi
G.R. No. 217426, December 04, 2017 Arabia (Ministry of Health) required a re-examination of Raguindin, which the
General Care Dispensary conducted on April 28, 2008. However, the results of the re-
ST. MARTIN POLYCLINIC, INC., Petitioner, v. examination remained the same, i.e., Raguindin was positive for HCV, which results
were reflected in a Certification dated April 28, 2008 (Certification). An undated disease after his medical examination in the Philippines up to the time of his
HCV Confirmatory Test Report likewise conducted by the Ministry of Health deployment, there being no evidence offered to corroborate the same.
affirmed such finding, thereby leading to Raguindin's repatriation to the Philippines.
Aggrieved, petitioner appealed to the RTC, contending, among others, that
Claiming that petitioner was reckless in issuing its Medical Report stating that respondent failed to comply with the requirements on the authentication and proof of
Raguindin is "fit for employment" when a subsequent finding in Saudi Arabia documents under Section 24, Rule 132 of the Rules of Court, considering that
revealed that he was positive for HCV, respondent filed a Complaint for sum of respondent's evidence, particularly the April 28, 2008 Certification issued by the
money and damages against petitioner before the Metropolitan Trial Court of General Care Dispensary and the HCV Confirmatory Test Report issued by the
Mandaluyong City, Branch 60 (MeTC). Respondent essentially averred that it relied Ministry of Health, are foreign documents issued in Saudi Arabia.
on petitioner's declaration and incurred expenses as a consequence. Thus, respondent
prayed for the award of damages in the amount of P84,373.41 representing the The RTC Ruling
expenses it incurred in deploying Raguindin abroad.
In a Decision dated December 15, 2011, the RTC dismissed petitioner's appeal and
In its Answer with compulsory counterclaim, petitioner denied liability and claimed affirmed the MeTC Decision in its entirety. Additionally, the RTC pointed out that
that: first, respondent was not a proper party in interest for lack of privity of contract petitioner can no longer change the theory of the case or raise new issues on appeal,
between them; second, the MeTC had no jurisdiction over the case as it involves the referring to the latter's argument on the authentication of respondent's documentary
interpretation and implementation of a contract of employment; third, the action is evidence.
premature as Raguindin has yet to undergo a post-employment medical examination
following his repatriation; and fourth, the complaint failed to state a cause of action as Petitioner's motion for reconsideration was denied in an Order dated May 25, 2012.
the Medical Report issued by petitioner had already expired on April 11, 2008, or Dissatisfied, petitioner elevated the case to the CA.
three (3) months after its issuance on January 11, 2008.
The CA Ruling
The MeTC Ruling
In a Decision dated July 11, 2014, the CA affirmed the RTC Decision, with the
In a Decision dated December 17, 2010, the MeTC rendered judgment in favor of modification deleting the award of actual damages and instead, awarding temperate
respondent and ordered petitioner to pay the amount of P84,373.41 as actual damages in the amount of P50,000.00.
damages, P20,000.00 as attorney's fees, and the costs of suit.
The CA held that petitioner failed to perform its duty to accurately diagnose
At the onset, the MeTC held that it had jurisdiction over the case, since respondent Raguindin when it issued its Medical Report declaring the latter "fit for employment",
was claiming actual damages incurred in the deployment of Raguindin in the amount considering that he was subsequently found positive for HCV in Saudi Arabia.
of P84,373.41. It further ruled that respondent was a real party in interest, as it would Further, the CA opined that the Certification issued by the General Care Dispensary is
not have incurred expenses had petitioner not issued the Medical Report certifying not a public document and in such regard, rejected petitioner's argument that the same
that Raguindin was fit to work. is inadmissible in evidence for not having been authenticated. Moreover, it remarked
that petitioner's own Medical Report does not enjoy the presumption of regularity as
On the merits, the MeTC found that respondent was entitled to be informed petitioner is merely an accredited clinic. Finally, the CA ruled that petitioner could
accurately of the precise condition of Raguindin before deploying the latter abroad not disclaim liability on the ground that Raguindin tested positive for HCV in Saudi
and consequently, had sustained damage as a result of the erroneous certification. In Arabia after the expiration of the Medical Report on April 11, 2008, noting that the
this relation, it rejected petitioner's contention that Raguindin may have contracted the General Care Dispensary issued its Certification on April 28, 2008, or a mere
seventeen (17) days from the expiration of petitioner's Medical Report. Hence, the
CA concluded that "it is contrary to human experience that a newly-deployed
overseas worker, such as Raguindin, would immediately contract a serious virus at Article 2176. Whoever by act or omission causes damage to another, there being fault
the very beginning of a deployment." or negligence, is obliged to pay for the damage done. Such fault or negligence, if
there is no pre-existing contractual relation between the parties, is called a quasi-
However, as the records are bereft of evidence to show that respondent actually delict and is governed by the provisions of this Chapter.
incurred the amount of P84,373.41 as expenses for Raguindin's deployment, the CA
deleted the award of actual damages and instead, awarded temperate damages in the The elements of a quasi-delict are: (1) an act or omission; (2) the presence of fault or
amount of P50,000.00. negligence in the performance or non-performance of the act; (3) injury; (4) a causal
connection between the negligent act and the injury; and (5) no pre-existing
Aggrieved, petitioner filed a motion for partial reconsideration, which the CA denied contractual relation.
in a Resolution dated February 27, 2015; hence, this petition.
As a general rule, any act or omission coming under the purview of Article 2176
The Issue Before the Court gives rise to a cause of action under quasi-delict. This, in turn, gives the basis for a
claim of damages. Notably, quasi-delict is one among several sources of obligation.
The essential issue advanced for the Court's resolution is whether or not petitioner Article 1157 of the Civil Code states:
was negligent in issuing the Medical Report declaring Raguindin "fit for
employment" and hence, should be held liable for damages. Article 1157. Obligations arise from:

The Court's Ruling (1) Law;

(2) Contracts;
The petition is granted. (3) Quasi-contracts;
(4) Acts or omissions punished by law; and
I. (5) Quasi-delicts.

At the outset, it should be pointed out that a re-examination of factual findings cannot However, as explained by Associate Justice Marvic M.V.F. Leonen (Justice Leonen)
be done acting on a petition for review on certiorari because the Court is not a trier of in his opinion in Alano v. Magud-Logmao (Alano), "Article 2176 is not an all-
facts but reviews only questions of law. Thus, in petitions for review on certiorari, encompassing enumeration of all actionable wrongs which can give rise to the
only questions of law may generally be put into issue. This rule, however, admits of liability for damages. Under the Civil Code, acts done in violation of Articles 19, 20,
certain exceptions, such as "when the inference made is manifestly mistaken, absurd and 21 will also give rise to damages." These provisions - which were cited as bases
or impossible"; or "when the findings are conclusions without citation of specific by the MTC, RTC and CA in their respective rulings in this case - read as follows:
evidence on which they are based." Finding a confluence of certain exceptions in this
case, the general rule that only legal issues may be raised in a petition for review on Article 19. Every person must, in the exercise of his rights and in the performance of
certiorari under Rule 45 of the Rules of Court would not apply, and the Court retains his duties, act with justice, give everyone his due, and observe honesty and good
the authority to pass upon the evidence presented and draw conclusions therefrom. faith.

II. Article 20. Every person who, contrary to law, willfully or negligently causes damage
to another, shall indemnify the latter for the same.
An action for damages due to the negligence of another may be instituted on the basis
of Article 2176 of the Civil Code, which defines a quasi-delict:
Article 21. Any person who willfully causes loss or injury to another in a manner that
is contrary to morals, good customs, or public policy shall compensate the latter for Article 2176 covers situations where an injury happens through an act or omission of
the damage. the defendant. When it involves a positive act, the intention to commit the outcome is
irrelevant. The act itself must not be a breach of an existing law or a pre-existing
"[Article 19], known to contain what is commonly referred to as the principle of contractual obligation. What will be considered is whether there is "fault or
abuse of rights, sets certain standards which must be observed not only in the exercise negligence” attending the commission of the act which necessarily leads to the
of one's rights, but also in the performance of one's duties." Case law states that outcome considered as injurious by the plaintiff. The required degree of diligence will
"[w]hen a right is exercised in a manner which does not conform with the norms then be assessed in relation to the circumstances of each and every case. (Emphases
enshrined in Article 19 and results in damage to another, a legal wrong is thereby and underscoring supplied)
committed for which the wrongdoer must be held responsible. But while Article 19
lays down a rule of conduct for the government of human relations and for the Thus, with respect to negligent acts or omissions, it should therefore be discerned that
maintenance of social order, it does not provide a remedy for its violation. Article 20 of the Civil Code concerns "violations of existing law as basis for an
Generally, an action for damages under either Article 20 or Article 21 would [then] injury", whereas Article 2176 applies when the negligent act causing damage to
be proper." Between these two provisions as worded, it is Article 20 which applies to another does not constitute "a breach of an existing law or a pre-existing contractual
both willful and negligent acts that are done contrary to law. On the other hand, obligation."
Article 21 applies only to willful acts done contra bonos mores.
In this case, the courts a quo erroneously anchored their respective rulings on the
In the Alano case, Justice Leonen aptly elaborated on the distinctive applications of provisions of Articles 19, 20, and 21 of the Civil Code. This is because respondent
Articles 19, 20 and 21, which are general provisions on human relations, vis-a-vis did not proffer (nor have these courts mentioned) any law as basis for which damages
Article 2176, which particularly governs quasi-delicts: may be recovered due to petitioner's alleged negligent act. In its amended complaint,
respondent mainly avers that had petitioner not issue a "fit for employment" Medical
Article 19 is the general rule which governs the conduct of human relations. By itself, Report to Raguindin, respondent would not have processed his documents, deployed
it is not the basis of an actionable tort. Article 19 describes the degree of care required him to Saudi Arabia, and later on - in view of the subsequent findings that Raguindin
so that an actionable tort may arise when it is alleged together with Article 20 or was positive for HCV and hence, unfit to work - suffered actual damages in the
Article 21. amount of P84,373.41.52 Thus, as the claimed negligent act of petitioner was not
premised on the breach of any law, and not to mention the incontestable fact that no
Article 20 concerns violations of existing law as basis for an injury. It allows pre-existing contractual relation was averred to exist between the parties, Article 2176
recovery should the act have been willful or negligent. Willful may refer to the - instead of Articles 19, 20 and 21 - of the Civil Code should govern.
intention to do the act and the desire to achieve the outcome which is considered by
the plaintiff in tort action as injurious. Negligence may refer to a situation where the III.
act was consciously done but without intending the result which the plaintiff
considers as injurious. Negligence is defined as the failure to observe for the protection of the interests of
another person, that degree of care, precaution and vigilance which the circumstances
Article 21, on the other hand, concerns injuries that may be caused by acts which are justly demand, whereby such other person suffers injury.
not necessarily proscribed by law. This article requires that the act be willful, that is,
that there was an intention to do the act and a desire to achieve the outcome. In cases As early as the case of Picart v. Smith, the Court elucidated that "the test by which to
under Article 21, the legal issues revolve around whether such outcome should be determine the existence of negligence in a particular case is: Did the defendant in
considered a legal injury on the part of the plaintiff or whether the commission of the doing the alleged negligent act use that reasonable care and caution which an
act was done in violation of the standards of care required in Article 19. ordinarily prudent person would have used in the same situation? If not, then he is
guilty of negligence." Corollary thereto, the Court stated that "[t]he question as to that there were already palpable signs that exhibited Raguindin's unfitness for
what would constitute the conduct of a prudent man in a given situation must of deployment at that time. This is hardly the case when respondent only proffered
course be always determined in the light of human experience and in view of the facts evidence which demonstrate that months after petitioner's Medical Report was issued,
involved in the particular case. Abstract speculation cannot here be of much value x x Raguindin, who had already been deployed to Saudi Arabia, tested positive for HCV
x: Reasonable men govern their conduct by the circumstances which are before them and as such, was no longer "fit for employment".
or known to them. They are not, and are not supposed to be, omniscient of the future.
Hence[,] they can be expected to take care only when there is something before them In fact, there is a reasonable possibility that Raguindin became exposed to the HCV
to suggest or warn of danger." only after his medical examination with petitioner on January 11, 2008. Based on
published reports from the World Health Organization, HCV or the hepatitis C virus
Under our Rules of Evidence, it is disputably presumed that a person takes ordinary causes both acute and chronic infection. Acute HCV infection is usually
care of his concerns and that private transactions have been fair and regular. In effect, asymptomatic, and is only very rarely associated with life-threatening diseases. The
negligence cannot be presumed, and thus, must be proven by him who alleges it. In incubation period for HCV is two (2) weeks to six (6) months, and following initial
Huang v. Philippine Hoteliers, Inc.: infection, approximately 80% of people do not exhibit any symptoms. Indisputably,
Raguindin was not deployed to Saudi Arabia immediately after petitioner's medical
[T]he negligence or fault should be clearly established as it is the basis of her action. examination and hence, could have possibly contracted the same only when he
The burden of proof is upon [the plaintiff]. Section 1, Rule 131 of the Rules of Court arrived thereat. In light of the foregoing, the CA therefore erred in holding that "[h]ad
provides that "burden of proof is the duty of a party to present evidence on the facts in petitioner more thoroughly and diligently examined Raguindin, it would likely have
issue necessary to establish his claim or defense by the amount of evidence required discovered the existence of the HCV because it was contrary to human experience
by law." It is then up for the plaintiff to establish his cause of action or the defendant that a newly-deployed overseas worker, such as Raguindin, would immediately have
to establish his defense. Therefore, if the plaintiff alleged in his complaint that he was contracted the disease at the beginning of his deployment"
damaged because of the negligent acts of the defendant, he has the burden of proving
such negligence. It is even presumed that a person takes ordinary care of his concerns. While petitioner's Medical Report indicates an expiration of April 11, 2008, the Court
The quantum of proof required is preponderance of evidence. (Emphasis and finds it fitting to clarify that the same could not be construed as a certified guarantee
underscoring supplied) coming from petitioner that Raguindin's medical status at the time the report was
issued on January 11, 2008 (i.e., that he was fit for employment) would remain the
The records of this case show that the pieces of evidence mainly relied upon by same up until that date (i.e., April 11, 2008). As earlier intimated, the intervening
respondent to establish petitioner's negligence are: (a) the Certification dated April period could very well account for a number of variables that could have led to a
28, 2008; and (b) the HCV Confirmatory Test Report. However, these issuances only change in Raguindin's condition, such as his deployment to a different environment in
indicate the results of the General Care Dispensary and Ministry of Health's own Saudi Arabia. If at all, the expiration date only means that the Medical Report is valid
medical examination of Raguindin finding him to be positive for HCV. Notably, the - and as such, could be submitted - as a formal requirement for overseas employment
examination conducted by the General Care Dispensary, which was later affirmed by up until April 11, 2008; it does not, by any means, create legal basis to hold the issuer
the Ministry of Health, was conducted only on March 24, 2008, or at least two (2) accountable for any intervening change of condition from the time of issuance up
months after petitioner issued its Medical Report on January 11, 2008. Hence, even until expiration. Truly, petitioner could not be reasonably expected to predict, much
assuming that Raguindin's diagnosis for HCV was correct, the fact that he later tested less assure, that Raguindin's medical status of being fit for employment would remain
positive for the same does not convincingly prove that he was already under the same unchanged. Thus, the fact that the Medical Report's expiration date of April 11, 2008
medical state at the time petitioner issued the Medical Report on January 11, 2008. In was only seventeen (17) days away from the issuance of the General Care
this regard, it was therefore incumbent upon respondent to show that there was Dispensary's April 28, 2008 Certification finding Raguindin positive for HCV should
already negligence at the time the Medical Report was issued, may it be through not - as it does not - establish petitioner's negligence.
evidence that show that standard medical procedures were not carefully observed or
IV. opportunity to cross-examine the person to whom the statements or writings are
attributed. Its executor or author should be presented as a witness to provide the other
At any rate, the fact that Raguindin tested positive for HCV could not have been party to the litigation the opportunity to question its contents. Being mere hearsay
properly established since the courts a quo, in the first place, erred in admitting and evidence, failure to present the author of the medical certificate renders its contents
giving probative weight to the Certification of the General Care Dispensary, which suspect and of no probative value," as in this case.
was written in an unofficial language. Section 33, Rule 132 of the Rules of Court
states that: Similarly, the HCV Confirmatory Test Report issued by the Ministry of Health of
Saudi Arabia should have also been excluded as evidence. Although the same may be
Section 33. Documentary evidence in an unofficial language. - Documents written in considered a public document, being an alleged written official act of an official body
an unofficial language shall not be admitted as evidence, unless accompanied with a of a foreign country, the same was not duly authenticated in accordance with Section
translation into English or Filipino. To avoid interruption of proceedings, parties or 24, Rule 132 of the Rules of Court. While respondent provided a translation thereof
their attorneys are directed to have such translation prepared before trial. from the National Commission on Muslim Filipinos, Bureau of External Relations,
Office of the President, the same was not accompanied by a certificate of the
A cursory examination of the subject document would reveal that while it contains secretary of the embassy or legation, consul-general, consul, vice-consul, or consular
English words, the majority of it is in an unofficial language. Sans any translation in agent or any officer in the foreign service of the Philippines stationed in Saudi
English or Filipino provided by respondent, the same should not have been admitted Arabia, where the record is kept, and authenticated by the seal of his office.
in evidence; thus their contents could not be given probative value, and deemed to
constitute proof of the facts stated therein. To be sure, petitioner - contrary to respondent's contention - has not changed its
theory of the case by questioning the foregoing documents. As petitioner correctly
Moreover, the due execution and authenticity of the said certification were not proven argued, it merely amplified its defense that it is not liable for negligence when it
in accordance with Section 20, Rule 132 of the Rules of Court: further questioned the validity of the issuances of the General Care Dispensary and
Ministry of Health. In Limpangco Sons v. Yangco, the Court explained that "[t]here
Section 20. Proof of private document. - Before any private document offered as is a difference x x x between a change in the theory of the case and a shifting of the
authentic is received in evidence, its due execution and authenticity must be proved incidence of the emphasis placed during the trial or in the briefs." "Where x x x the
either: theory of the case as set out in the pleadings remains the theory throughout the
progress of the cause, the change of emphasis from one phase of the case as presented
(a) By anyone who saw the document executed or written; or by one set of facts to another phase made prominent by another set of facts x x x does
(b)By evidence of the genuineness of the signature or handwriting of the maker. not result in a change of theory x x x". In any case, petitioner had already questioned
(c)Any other private document need only be identified as that which it is claimed to the validity of these documents in its Position Paper before the MeTC. Hence, there is
be. no change of theory that would preclude petitioner's arguments on this score.

Notably, the foregoing provision applies since the Certification does not fall within All told, there being no negligence proven by respondent through credible and
the classes of public documents under Section 19, Rule 132 of the Rules of Court - admissible evidence, petitioner cannot be held liable for damages under Article 2176
and hence, must be considered as private. It has been settled that an unverified and of the Civil Code as above-discussed.
unidentified private document cannot be accorded probative value. In addition, case
law states that "since a medical certificate involves an opinion of one who must first WHEREFORE, the petition is GRANTED. Accordingly, the Decision dated July 11,
be established as an expert witness, it cannot be given weight or credit unless the 2014 and the Resolution dated February 27, 2015 of the Court of Appeals in CA-G.R.
doctor who issued it is presented in court to show his qualifications. It is precluded SP No. 125451 are REVERSED and SET ASIDE, and a NEW ONE is entered,
because the party against whom it is presented is deprived of the right and
DISMISSING the complaint of respondent LWV Construction Corporation for lack certification from Raso, the Barangay Power Association (BAPA) Chairperson.
of merit. Respondent then instructed his farmhand to get a certification from Raso but despite
efforts to reach Raso, the latter was unavailable. Thus, respondent consented to the
SO ORDERED. tapping of his electrical line to that of BAPA upon the assurance of Albelda that he
would not be charged with pilferage of electricity because his electric usage shall be
[ G.R. No. 246012, June 17, 2020 ] determined by the check meter of BOHECO I at the base of the drop line and shall be
billed accordingly.
ISMAEL G. LOMARDA AND CRISPINA RASO,
PETITIONERS, VS. ENGR. ELMER T. FUDALAN, In the morning of October 8, 2006, respondent still tried again to obtain Raso's
RESPONDENT, certification. However, during their meeting, Raso allegedly got mad, vowed to never
issue the said certification, and eventually then reported the matter to BOHECO I for
disconnection.
BOHOL I ELECTRIC COOPERATIVE, INC.,
DEFENDANT. Feeling aggrieved, respondent and his wife went to BOHECO I on October 17, 2006
to complain about Raso's malicious actuations. They were attended to by the
receiving clerk, petitioner Lomarda, who, after reviewing their documents, told them
DECISION that he would conduct an ocular inspection of their farmhouse. The next day,
respondent, together with his farmhand, went looking for Raso and confronted her
about the latter's threat of disconnection. To appease them, Raso guaranteed not to
PERLAS-BERNABE, J.: order the disconnection of respondent's electricity; nevertheless, she still refused to
issue the certification on the premise that respondent's farmhouse already had
Assailed in this petition for review on certiorari are the Decision dated February 9, electricity. In the course of their conversation, Raso uttered, "Sabut sabuton lang ni
2017 and the Resolution dated May 19, 2017 of the Court of Appeals (CA) in CA- nato," which translates to "let us just settle this."
G.R. CV No. 04480, which affirmed the Decision dated May 15, 2012 of the
Regional Trial Court of Tagbilaran City, Bohol, Branch 49 (RTC) in Civil Case No. On November 5, 2006, respondent and his wife once more went to Raso to follow up
7476, granting the complaint for damages filed by respondent Engr. Elmer T. Fudalan on the issuance of such certification. They met at the purok center, where Raso was
(respondent) against petitioners Ismael D. Lomarda (Lomarda) and Crispina Raso conducting a meeting with several purok members. Thereat, Raso asked why
(Raso; collectively, petitioners). respondent's electricity has not yet been installed. Respondent took this to be a
sarcastic and rhetorical remark because Raso was, in fact, the one withholding the
The Facts issuance of the BAPA certification which was precisely the cause of the delay of the
aforesaid installation.
On September 27, 2006, respondent, through his wife, Alma Fudalan, applied for
electrical service from BOHECO I Electric Cooperative Inc. (BOHECO I) to In another confrontation, Raso explained that she was about to issue the certification
illuminate their farmhouse located in Cambanac, Baclayon, Bohol. At the pre- but was prevented by Lomarda, who allegedly apprised her of a pending complaint
membership seminar, respondent paid the amount of P48.12 as membership fee and for premature tapping against respondent. To settle the misunderstanding, Raso
was advised to employ the services of an authorized electrician from BOHECO I. directed respondent to discuss the matter with Lomarda at his house, and again
Accordingly, on October 7, 2006, respondent employed the services of Sabino uttered "Sabut sabuton lang ni nato." During their conversation, Lomarda told
Albelda Sr. (Albelda), a BOHECO I authorized electrician, who informed him that respondent that he earlier received a disconnection order issued a long time ago but
the electrical connection could only be installed in his farmhouse if he procures a misplaced the document, and that an ocular inspection of respondent's farmhouse will
be conducted on November 6, 2006. When respondent informed Raso of the date of
inspection, the latter once again remarked, "Sabut sabuton lang ni nato." In so ruling, the RTC held that respondent could not have committed premature
electrical connection or electric pilferage in violation of the existing rules and
On the day of inspection, or on November 6, 2006, respondent was assured that his regulations of BOHECO I, considering that the installation of respondent's electrical
electricity will not be disconnected and that Raso will issue the certification, provided connection was only done upon the advice of Albelda, who is an authorized
he would pay the amount of P1,750.00 or sign a promissory note. Respondent, electrician of BOHECO I. Moreover, the RTC pointed out that respondent was in
however, refused to comply with the said conditions, reasoning that there was no good faith and exerted all his efforts to comply with the requirements of BOHECO I,
official order from the concerned office. After respondent refused to pay, Lomarda while petitioners performed acts that are malicious, dishonest, and in gross bad faith.
allegedly posed in front of a camera and while pointing at the slot provided for the In particular, petitioners intentionally withheld the issuance of the required BAPA
electric meter, shouted, "This is an illegal tapping." Thereafter, Lomarda, in the certification and worse, demanded the payment of P1,750.00, when what was due
presence of policemen, the barangay treasurer, and other several passersby, ordered from respondent was only P20.00. Consequently, the RTC ruled that petitioners are
his linemen to cut off respondent's electricity. liable under Article 21 of the Civil Code.

On November 9, 2006, respondent communicated with BOHECO I, through phone, Aggrieved, petitioners appealed to the Court of Appeals (CA).
and inquired about his electric dues. He was informed that there was no system loss
or excess billed to the cooperative, and that his electric usage amounted only to The CA Ruling
P20.00.
In a Decision dated February 9, 2017, the CA affirmed the RTC Decision.
Claiming that petitioners' acts tarnished his image, besmirched his reputation, and
defamed his honor and dignity, respondent filed a complaint for damages before the At the onset, the CA observed that respondent exerted all efforts to comply with the
RTC. Respondent alleged that petitioners confederated with one another to purposely prescribed requirements in good faith. Moreover, it pointed out that respondent was
delay the approval of his application for electric connection by: (a) withholding the not caught in flagrante delicto of premature tapping because he was the one who
issuance of the BAPA certification; (b) falsely accusing him of premature tapping and reported to Raso the fact of tapping, which was only done under the context that the
pilferage of electricity; and (c) demanding the payment of P1,750.00, when what was approving authority was then unavailable to issue the certification despite
due him was only P20.00. respondent's efforts. On the other hand, the CA ruled that petitioners acted with
malice and bad faith, as exhibited by their conduct before, during, and after the
For their part, petitioners contended that respondent committed premature tapping of disconnection, which is contrary to morals, good customs, or public policy.
electricity, when the latter consented to the tapping of his line to the service line of
BAPA without a "turn-on" order from BOHECO I. Moreover, they claim that they Undaunted, petitioners moved for reconsideration but was denied in a Resolution
cannot be faulted for the disconnection, since they gave respondent the option to pay dated May 19, 2017; hence, this petition.
the penalty or sign a promissory note, which the latter refused.
The Issue Before the Court
The RTC Ruling
The issue for the Court's resolution is whether or not the CA correctly upheld the
In a Decision dated May 15, 2012, the RTC found petitioners liable for damages award of damages under Article 21 of the Civil Code.
under Article 21 of the Civil Code, and accordingly, ordered them to jointly and
severally pay respondent the following amounts: (a) P451.65 as actual damages; (b) The Court's Ruling
P200,000.00 as moral damages; (c) P100,000.00 as exemplary damages; (d)
P50,000.00 as attorney's fees; and (e) P20,000.00 as litigation expenses.
At the outset, it bears stressing that factual findings of the trial court, especially when
affirmed by the CA, deserve great weight and respect, unless there are facts of weight Art. 21. Any person who willfully causes loss or injury to another in a manner that is
and substance that were overlooked or misinterpreted and that would materially affect contrary to morals, good customs or public policy shall compensate the latter for
the disposition of the case. Hence, finding no cogent reason to the contrary, their damages.
factual findings in this case are sustained.
Thus, in Philippine National Bank vs. CA, this Court held that:
Petitioners mainly argue that they should not be held liable for damages, considering
that respondent made a premature and unauthorized tapping of his electrical The aforecited provisions on human relations were intended to expand the concept of
connection. In this regard, they invoke the principle that he who comes to court must torts in this jurisdiction by granting adequate legal remedy for the untold number of
come with clean hands. Moreover, petitioners allege that respondent is not entitled to moral wrongs which is impossible for human foresight to specifically provide in the
moral damages in the absence of evidence to show that the acts imputed against them statutes.
caused respondent moral suffering.
Although Article 19 merely declares a principle of law, Article 21 gives flesh to its
The arguments of petitioners are untenable. provisions. Thus, we agree with private respondent's assertion that violations of
Articles 19 and 21 are actionable, with judicially enforceable remedies in the
In this case, petitioners were found liable by both the RTC and CA for abuse of municipal forum.
rights under Article 19, in relation to Article 21, of the Civil Code.
In Mata v. Agravante, the Court pointed out that Article 21 of the Civil Code "refers
"Article 19, known to contain what is commonly referred to as the principle of abuse to acts contra bonos mores and has the following elements: (1) an act which is legal;
of rights, sets certain standards which may be observed not only in the exercise of (2) but which is contrary to morals, good customs, public order or public policy; and
one's rights but also in the performance of one's duties." In this regard, case law states (3) is done with intent to injure."
that "[a] right, though by itself legal because [it is] recognized or granted by law as
such, may nevertheless become the source of some illegality. When a right is In this case, records show that respondent had consistently pursued all reasonable
exercised in a manner which does not conform with the norms enshrined in Article 19 efforts to comply with the prescribed requirements for the installation of electrical
and results in damage to another, a legal wrong is thereby committed for which the connection at his farmhouse. As part of his application for electrical service with
wrongdoer must be held responsible." BOHECO I, he attended a premembership seminar wherein he duly paid the amount
of P48.12 as membership fee. At the seminar, he was advised to employ the services
"Article 19 is the general rule which governs the conduct of human relations. By of a BOHECO I authorized electrician, which he did by employing Albelda. As the
itself, it is not the basis of an actionable tort. Article 19 describes the degree of care CA pointed out, there were certain advantages to this course of action, considering
required so that an actionable tort may arise when it is alleged together with Article that: (a) the said electrician is familiar with the rules and regulations of BOHECO I;
20 or Article 21." In Saudi Arabian Airlines v. CA, the Court explained the relation of (b) an inspection fee will not be charged if the wiring is done by him; and (c)
Article 19 and Article 21 of the Civil Code: BOHECO I shall provide a 30-meter service drop wire, and electric meter, free of
charge, upon payment of the bill deposit.
On one hand, Article 19 of the New Civil Code provides:
Eventually, Albelda informed respondent that he could only install the electrical
Art. 19. Every person must, in the exercise of his rights and in the performance of his connection in respondent's farmhouse if the latter becomes a BAPA member and if he
duties, act with justice, give everyone his due, and observe honesty and good faith. can obtain a certification as such from BAPA Chairperson Raso. Again, respondent
took no time in obtaining this certification by instructing his farmhand to reach the
On the other hand, Article 21 of the New Civil Code provides: aforesaid chairperson. Unfortunately, Raso was unavailable despite the farmhand's
diligent efforts. Respondent, who was then put into a precarious situation, sought the Q. Now, after hearing that statement "Sabut saboton lang ni nato", what did you ask
advice of Albelda, the cooperative's authorized electrician, on how to deal with the Mrs. Raso what (sic) was that meaning of "Sabut saboton lang ni nato"?
matter. Albelda then assured him that if he will proceed with the tapping of his
electrical line to that of BAPA, he would not be charged with pilferage of electricity A. I did not bother to ask her but in my mind it means money that Mrs. Raso together
and would be billed accordingly. Relying in good faith on the authorized electrician's with Mr. Lomarda is out to victimize me to please me (sic) "[pangkwartahan] ko"
advice on the matter, respondent then consented to the tapping but nonetheless, still (sic) because of that premature connection.
instructed his farmhand to secure the certification from Raso to ensure compliance
with the requirements for proper installation. Upon meeting with Raso, respondent, In this regard, the CA aptly observed that "[c]onfronted with the crisis presented by
by his own volition, candidly brought to her attention the tapping of BAPA's line and [respondent], it is only proper for [petitioners] to tell him what corrective or remedial
duly explained to her the situation. This notwithstanding, Raso was quick to impute measures must be done to avoid the commission of any further infraction. Instead of
malicious actuations against respondent for proceeding with the tapping and reported doing so, x x x Raso made herself unavailable, which delayed the issuance of the
the matter to BOHECO I for disconnection. certification. For his part, x x x Lomarda failed to immediately disclose the notice of
disconnection to [respondent], under the pretext that he is yet to conduct an ocular
Faced with this predicament, respondent and his wife went to the cooperative to inspection on the subject farmhouse."
report Raso's actions. They were then attended by the receiving clerk, Lomarda, who
told them that he would conduct an ocular inspection of the farmhouse. In the course Worse than their inaction and lack of forthrightness, petitioners even tried to extort
of trying to comply with the requirements, both Raso and Lomarda gave respondent from respondent the amount of P1,792.00 in exchange for the issuance of a
the roundabout by consistently assuring him that they were settling the matter ("Sabut certification and for the continued availment of their electrical services. However,
sabuton lang ni nato"). The following excerpt of respondent's testimony during trial is respondent refused to accede to this condition since there was no official issuance
instructive on this score: coming from BOHECO I itself. In fact, upon reporting the matter to the cooperative,
respondent, to his dismay, discovered that his electric usage amounted to only P20.00.
Q. Now, did Mrs. Raso tell you while that controversy was between you during that Indeed, as the CA ruled, "[b]y setting these conditions, it is evident that [petitioners]
time that rather Mrs. Raso told you in visayan vernacular "Sabut saboton lang ni were induced by an ill motive."
nato"? (sic)
To further exacerbate the situation, petitioner Lomarda even caused a scene in the
A. Oh! Ye[s] (sic) she mentioned that p[hrase] (sic) which disturb me so much for 3 public's view which made it appear that respondent was an unscrupulous violator and
three (3) times (sic), 1.) when I went together with my farm help I went to her house thereupon, proceeded to disconnect his electricity that caused him embarrassment and
on October 18 her parting words (sic) was don't worry you will not be disconnected humiliation. As the testimony of respondent during trial shows:
"Sabut saboton lang ni nato" and the other two (2) was on November 5 when I again
look (sic) her which I found her at the purok center to ask for my certification again Q. Now, Mr. witness to refresh your memory according to you on November 6, 2006
and her parting words is (sic) "Sabut saboton lang ni nato" and then she told me to go Mr. Ismale (sic) Lomarda went to your house at Cambanac, Baclayon, Bohol what
(sic) Mr. Lomarda because Mr. Lomarda has the final say whether she will give me did Mr. Lomardo do when he reached at (sic) your house?
my certification or not. And the 3rd, was again on the same date November 5 already
night time when Mr. Lomarda told me that he is going to inspect the house on A. It was in the afternoon of November 6 Mr. Lomarda bringing with him 2
Monday so that I went back to Mrs. Raso to inform her that Mr. Lomarda is going to Policemen (sic) they were also bringing with them camera taking pictures on the post
inspect the house on Monday and again Mrs. Raso told me that "Sabut saboton lang where the electrical line was connected and there were many people around.
ni nato."
Q. Then after that what did Mr. Lomarda do?
A. Mr. Lomarda in hearing the window (sic) with all the people shouted that "kita mo
ha" "kita mo ha" in our vernacular, "kita mo ha" at the same time pointing to the post A. Yes. Mrs. Raso was also present because she wanted me to sign a promissory note
where the electrical connection is made "kita mo ha" witness "ka ha" witness "ka ha" that if I have no cash to pay that P1,750.00 allege (sic) penalty then I should sign her
at the same time taking pictures. promissory note so that I will not also be disconnected. (Emphases supplied)

Q. So, after that what did Mr. Lomarda do? Under the foregoing circumstances, it is clear that petitioners should be held liable for
damages under Article 19, in relation to Article 21, of the Civil Code. While it
A. Mr. Lomarda demanded to (sic) me an amount of One Thousand Pesos appears that petitioners were engaged in a legal act, i.e., exacting compliance with the
(P1,750.00) (sic) according to him as payment of an allege penalty so that I will not requirements for the installation of respondent's electricity in his farmhouse, the
be disconnected. circumstances of this case show that the same was conducted contrary to morals and
good customs, and were in fact done with the intent to cause injury to respondent.
Q. Did you give that amount? Petitioners did not only fail to apprise respondent of the proper procedure to expedite
compliance with the requirements, they also misled him to believe that everything can
A. No. be settled, extorted money from him when only a meager amount was due, and worse,
publicly humiliated him in front of many people which ended up in the disconnection
Q. Then considering that you did not give that amount One Thousand (P1,750.00) of his electricity altogether. To be sure, the clean hands doctrine - which was invoked
(sic) what did Mr. Lomarda do? by petitioners herein - should not apply in their favor, considering that while
respondent may have technically failed to procure the required BAPA certification
A. Mr. Lomarda demanded or insisting (sic) that he is going to inspect the house and and proceeded with the tapping, the same was not due to his lack of effort or intention
when I let him in inside the house he refuse (sic) and told me to sign first his report in complying with the rules in good faith. As exhibited above, it was, in fact,
before he will enter the house. petitioners' own acts which made compliance with the rules impossible. Hence,
respondent was actually free from fault, negating the application of the clean hands
Q. Did you sign the report? doctrine, to wit:

A. I did not sign the report. Parties who do not come to court with clean hands cannot be allowed to profit from
their own wrongdoing. The action (or inaction) of the party seeking equity must be
Q. Now considering that you did not sign the report, what did Mr. Lomarda do? "free from fault, and he must have done nothing to lull his adversary into repose,
thereby obstructing and preventing vigilance on the part of the latter."
A. Mr. Lomarda instructed his line men because he was also bringing linemen to
finally cut (sic). Days after I ask Mrs. Raso whether she will allow the disconnection That being said, the awards of damages in favor of respondent are therefore
which Mrs. Raso answered in the affirmative and after that Mr. Lomarda instructed warranted. In this case, both the RTC and the CA awarded actual, moral, and
his line man to finally cut (sic). exemplary damages, including attorney's fees and litigation expenses.

Q. And that was on November 6, 2006? Actual damages are such compensation or damages for an injury that will put the
injured party in the position in which he had been before he was injured. They pertain
A. November 6, in the afternoon. to such injuries or losses that are actually sustained and susceptible of measurement.
To justify an award of actual damages, there must be competent proof of the actual
Q. Will (sic) Mrs. Raso present during the time when the line man of Mr. Lomarda amount of loss. In this case, the award of actual damages in the amount of P451.65
cut your electrical connection? was based on the evidence presented as found by both the RTC and CA. Hence,
finding no cogent reason to the contrary, and given that the same was supported by Art. 2208. In the absence of stipulation, attorney's fees and expenses of litigation,
receipts, the said award is sustained. other than judicial costs, cannot be recovered, except:

However, the Court finds otherwise with respect to the awards of moral and (1) When exemplary damages are awarded; x x x
exemplary damages, as well as attorney's fees and litigation expenses (in the amounts
of P200,000.00, P100,000.00, P50,000.00, and P20,000.00, respectively) which In view of the award of exemplary damages, the Court finds it proper to award
appear to be excessive considering the circumstances of this case. Notably, the attorney's fees and litigation costs but in the reduced amount of P25,000.00.
amounts of moral and exemplary damages may be discretionary upon the court
depending on the attendant circumstances of the case. In fine, the Court holds that petitioners, as joint tortfeasors under Article 21 of the
Civil Code, are jointly and severally liable to pay respondent the following amounts:
Under Article 2219 of the Civil Code, moral damages may be recovered, among (a) P451.65 as actual damages; (b) P50,000.00 as moral damages; (c) P50,000.00 as
others, in acts and actions referred to in Article 21 of the same Code. "[A]n award of exemplary damages; and (d) attorney's fees and litigation expenses in the amount of
moral damages must be anchored on a clear showing that the party claiming the same P25,000.00.
actually experienced mental anguish, besmirched reputation, sleepless nights,
wounded feelings, or similar injury." In this case, the aforementioned malicious acts, WHEREFORE, the petition is DENIED. The Decision dated February 9, 2017 and
as proven through the evidence presented by respondent, clearly caused moral the Resolution dated May 19, 2017 of the Court of Appeals in CA-G.R. CV No.
suffering to the latter, for which petitioners should be made liable. As intimated in 04480 are hereby AFFIRMED WITH MODIFICATION in that petitioners Ismael G.
one case, although mental anguish and emotional sufferings of a person are not Lomarda and Crispina Raso are ordered to jointly and severally pay respondent Elmer
quantifiable with mathematical precision, the Court must nonetheless strive to set an Fudalan the following amounts: (a) P451.65 as actual damages; (b) P50,000.00 as
amount that would restore respondent to his moral status quo ante. In this regard, the moral damages; (c) P50,000.00 as exemplary damages; and (d) attorney's fees and
Court finds it reasonable to award the amount of P50,000.00 as moral damages, litigation expenses in the amount of P25,000.00.
considering the meager amount of actual damages awarded despite the public
humiliation and distress suffered by respondent throughout his ordeal. SO ORDERED.

Meanwhile, case law states that "exemplary or corrective damages are imposed by [ G.R. No. 217806, July 28, 2020 ]
way of example or correction for the public good, in addition to moral, temperate,
liquidated, or compensatory damages. The award of exemplary damages is allowed
by law as a warning to the public and as a deterrent against the repetition of socially DIVISION ADELAIDA C. NAVARRO-BANARIA,
deleterious actions." In this case, the Court finds the award of exemplary damages in PETITIONER, VS. ERNESTO A. BANARIA, PANFILO A.
the amount of P50,000.00 reasonable in order to serve as a reminder against
unscrupulous persons - as herein petitioners - who take undue advantage of their BANARIA, GRACIA SEVERA BANARIA-ESPIRITU,
positions to the detriment of the consuming public. REINA CLARA BANARIA- MAGTOTO, MARCELINO S.
BANARIA, PAULINA BANARIA-GELIDO, MARIA
As regards attorney's fees and litigation costs, "Article 2208 of the New Civil Code of
the Philippines states the policy that should guide the courts when awarding attorney's LOURDES DIVINE BANARIA-DURAN, GRACIA
fees to a litigant. As a general rule, the parties may stipulate the recovery of attorney's ISABELITA BANARIA-ESPIRITU, GEOFFREY
fees. In the absence of such stipulation, this article restrictively enumerates the BANARIA-ESPIRITU, ANNE MARIE ESPIRITU-
instances when these fees may be recovered," to wit:
PAPPANIA, JUSTIN BANARIA-ESPIRITU, event was prepared by the respondents and the non-appearance of Pascasio during the
event allegedly caused loss and injury to the respondents.
RESPONDENTS.
Respondents alleged that the planning of the event started as early as February 2003
DECISION or a year before the planned 90th birthday celebration to be held on February 22,
2004. Between November 2003 and January 2004, respondents were in continuous
contact with Adelaida to remind her of the upcoming event. Adelaida, for her part,
REYES, J. JR., J.: confirmed Pascasio's attendance during the event although it coincides with the death
anniversary of Adelaida's mother. The plan was to bring Pascasio to the venue in the
This resolves the petition for review on certiorari filed under Rule 45 of the Rules of early morning of February 22, 2004 before proceeding to her hometown in Tarlac.
Civil Procedure seeking to review the Decision dated October 15, 2014 of the Adelaida promised respondents that she will try her best to attend the birthday
Honorable Court of Appeals (Special First Division) in CA-G.R. No. 97264, denying celebration in the evening after going to Tarlac.
the appeal of herein petitioner by affirming with modification the Judgment dated
May 23, 2011 rendered by the Regional Trial Court (RTC), Branch 216 (Quezon On February 13, 2004, Reina and Gracia Severa, who are both residing in the United
City) in Civil Case No. Q-0452212, and its Resolution dated April 14, 2015, denying States, arrived in the country to attend the birthday celebration of their father. They
petitioner's motion for reconsideration. were able to visit their father and Adelaida in their home on February 14 and 15,
2004. Adelaida promised them during their visit that Pascasio would be present in his
The Antecedents scheduled 90n birthday celebration.

The instant petition arose from the Complaint filed by respondents for Damages with However, much to the dismay of the Banaria siblings as well as their guests, Pascasio
the RTC of Quezon City against petitioner. was nowhere to be found in his 90th birthday celebration. Respondents continuously
called Adelaida but they were not able to contact her. Almost 200 guests were at the
As borne by the records of the case, respondents are brother (Marcelino S. Banaria), venue waiting for Pascasio to come. The siblings deemed it proper to continue the
sister (Paulina Banaria-Gelido), sons (Ernesto A. Banaria and Panfilo A. Banaria), celebration even without the birthday celebrant himself. Worried that there might be
daughters (Gracia Severa Banaria-Espiritu and Reina Clara Banaria-Magtoto), something untoward that happened to their father, respondents went to the nearest
granddaughters (Gracia Isabelita Banaria-Espiritu, Anne Marie Espiritu-Pappania, police station to report Pascasio as a missing person. However, they were advised by
Maria Lourdes Divine Banaria-Duran), and grandsons (Geoffrey Banaria-Espiritu and the police officers that before a person can be considered missing, there should be a
Justin Banaria-Espiritu) of the late Pasacasio S. Banaria, Sr. (Pascasio), while 24-hour waiting period. Thus, respondents just entered their concern in the police
petitioner Adelaida C. Navarro-Banaria (Adelaida) is the legal wife of Pascasio and blotter. The next day, the missing person report was officially made after Pascasio
stepmother of the Banaria siblings. and Adelaida have not been seen or heard for more than 24 hours.

Pascasio, the family patriarch, at the time of the filing of the complaint, was already Respondents called and went to the Securities and Exchange Commission (SEC),
frail and suffering from physical and mental infirmity incapacitating him to fully where Adelaida works but they failed to see her there. Afterwards, respondent Paulina
functioning on his own without any assistance. was able to talk to one of Adelaida's maids named Kit. Kit told Paulina that she went
to Tarlac with Pascasio and Adelaida in the morning of February 21, 2004 but went
The action for damages of respondents stemmed from the alleged bad faith, malice, their separate ways upon reaching said province. However, when asked about the
and deliberate failure of Adelaida to keep her word and honor her promise to bring whereabouts of Pascasio and Adelaida, she said that she did not know where they
Pascasio to his 90th birthday celebration held on February 22, 2004. Such special were.
In the evening of February 23, 2004, Marcelino, Pascasio's brother, told the other 5. the amount of P60,000.00, Philippine Currency, as and by way of attorney's fees;
respondents that Pascasio and Adelaida were at their residence then at 7-B Sigma and the costs of suit.
Drive, Alpha village, Quezon City. Respondents went to the said place to ask
Adelaida her reason why Pascasio was not able to attend the birthday celebration. SO ORDERED.
Adelaida reasoned that Pascasio did not want to go to the party. When asked why
Adelaida broke her commitment to bring Pascasio to the party, Adelaida uttered the Aggrieved, petitioner elevated the case to the Court of Appeals, which, through the
words, "I am the wife." assailed October 15, 2014 Decision, affirmed with modification the Decision of the
RTC. The fallo of the decision of the appellate court reads:
Thus, the Complaint for Damages filed by respondents against Adelaida.
WHEREFORE, premises considered, the appeal is hereby DENIED. The Judgment
In response, Adelaida rebutted the allegations of the respondents by saying that she dated 23 May 2011 of the Regional Trial Court-Branch 216 (Quezon City) is
was not privy to the respondents' planned birthday celebration for Pascasio. She also AFFIRMED with the following MODIFICATIONS: a) the amount of $3,619.00 (US
said that she deemed it wise to spare Pascasio of the embarrassment and humiliation Dollars) awarded as actual damages in favor of the plaintiffs-appellees is DELETED
of defecating and urinating without regard to the people around him brought about by for lack of factual and legal basis; b) the amount of moral damages awarded for ALL
his advanced age. the plaintiffs-appellees is REDUCED to a fixed amount of Php300,000.00; c) the
amount of exemplary damages awarded in favor of the plaintiffs-appellees is
Eventually, the RTC rendered its May 23, 2011 Decision, which ordered petitioner to REDUCED to Php30,000.00; and d) the amount of attorney's fees awarded to
pay the respondents' travel expenses, actual damages, moral damages, exemplary plaintiffs-appellees is likewise REDUCED to php50,000.00.
damages, and attorney's fees. The fallo of the decision reads:
The rest of the challenged Judgment stands.
WHEREFORE, in view of the foregoing considerations, judgment is hereby rendered
in favor of plaintiffs and against the defendant Adelaida C. Navarro-Banaria ordering SO ORDERED.
said defendant to pay unto the plaintiffs the following:
Despite petitioner's motion for reconsideration, the CA affirmed its October 15, 2014
1. the total amount of $3,619.00 (US Dollars) which may be paid in Philippine Decision via the April 14, 2015 Resolution.
Currency computed at the exchange rate at the time of payment, representing the total
sum for their (plaintiffs) travel expenses; Hence, this petition.

2. the amount of P61,200.00, Philippine currency, for the food and refreshments spent The Issues
during the birthday of Pascasio S. Banana, Sr., which the latter was not able to attend;
the amount of P3,000.00 for the birthday cake; and the amount of P3,275.00 for the The petitioner anchors her prayer for the reversal of the October 15, 2014 Decision
balloon arrangements; and the April 14, 2015 Resolution based on the following issues:

3. the amount of P60,000.00, Philippine Currency, for each and every plaintiff, as and A. Whether the Hon. Court of Appeals erred in ruling that petitioner violated Articles
by way of moral damages; 19 and 21 of the Civil Code regarding Human Relations; and

4. the amount of P50,000.00, Philippine Currency, for the herein plaintiffs, as and by B. Whether the Hon. Court of Appeals erred in granting damages to the respondents.
way of exemplary damages;
The Court's Ruling
 honesty and good faith, he opens himself to liability. The elements of an abuse of
After a careful perusal of the arguments presented and the evidence submitted, the rights under Article 19 are: (1) there is a legal right or duty; (2) which is exercised in
Court finds no merit in the petition. bad faith; (3) for the sole intent of prejudicing or injuring another.

Petitioner contends that she did not commit any violation under Article 19 of the Civil Consequently, when Article 19 is violated, an action for damages is proper under
Code by alleging that the testimonies of the respondents were pure surmises and Article 20 and 21 of the New Civil Code. Article 20 pertains to damages arising from
conjectures. Aside from that, petitioner avers that respondents failed to prove bad a violation of law.
faith, malice and ill motive on her part. Because of this, petitioner posits that there
can be no award of actual, moral and exemplary damages under the principle of For starters, there is no question that as legal wife and guardian of Pascasio, who is
damnum absque injuria or damage without injury since her legal right was not physically and mentally infirm, Adelaida has the principal and overriding decision
exercised in bad faith and with no intention to injure another. when it comes to the affairs of her husband including the celebration of the latter's
90th birthday.
Article 19 of the Civil Code provides that every person in the exercise of his rights
and in the performance of his duties must act with justice, give everyone his due, and However, it must be noted Adelaida's right, as with any rights, cannot be exercised
observe honesty and good faith. The principle embodied in this provision is more without limitation. The exercise of this right must conform to the exacting standards
commonly known as the "abuse of right principle." The legal consequence should of conduct enunciated in Article 19. Adelaida was clearly remiss in this aspect.
anyone violate this fundamental provision is found in Articles 20 and 21 of the Civil
Code. The correlation between the two provisions are showed in the case of GF Glaring is the fact that long before the scheduled date of Pascasio's 90th birthday
EQUITY, Inc. v. Valenzona, to wit: celebration, Adelaida was already informed about the event. As early as February
2003 or a year before the scheduled event, Adelaida was already reminded of the
[Article 19, known to contain what is commonly referred to as the principle of abuse event by the respondents to which she confirmed Pascasio's attendance. Even though
of rights, sets certain standards which must be observed not only in the exercise of Adelaida alleges that she was not privy to any birthday celebration for Pascasio, the
one's rights but also in the performance of one's duties. These standards are the fact remains that she was continuously informed and reminded about the scheduled
following: to act with justice; to give everyone his due; and to observe honesty and event. She even contributed P5,000.00 for the costs.
good faith. The law, therefore, recognizes a primordial limitation on all rights; that in
their exercise, the norms of human conduct set forth in Article 19 must be observed. Following Adelaida's testimony that Pascasio had already decided not to attend his
A right, though by itself legal because recognized or granted by law as such, may birthday celebration a day before such event, she should have contacted the
nevertheless become the source of some illegality. When a right is exercised in a respondents immediately for the respondents to be able to take appropriate action.
manner which does not conform with the norms enshrined in Article 19 and results in Adelaida knew fully well that the respondents already spent a considerable amount of
damage to another, a legal wrong is thereby committed for which the wrongdoer must money and earnest efforts were already made to ensure the success of the event. The
be held responsible. But while Article 19 lays down a rule of conduct for the least that Adelaida could have done was to inform the respondents immediately of
government of human relations and for the maintenance of social order, it does not any unforeseen circumstance that would hinder its success and to avert any further
provide a remedy for its violation. Generally, an action for damages under either damage or injury to the respondents. Moreover, considering that numerous guests
Article 20 or Article 21 would be proper. (Emphasis supplied) were invited and have confirmed their attendance, she placed the respondents in a
very embarrassing situation.
While Article 19 of the New Civil Code may have been intended as a mere
declaration of principle, the "cardinal law on human conduct" expressed in said article Instead of making good on her prior commitment, Adelaida allegedly followed
has given rise to certain rules, e.g., that where a person exercises his rights but does Pascasio's wish of going to Tarlac and arrived thereat in the afternoon of February 21,
so arbitrarily or unjustly or performs his duties in a manner that is not in keeping with 2004. At that time, Adelaida still had the opportunity to contact the respondents and
inform them that they will not be able to come, but she did not. Her excuse, that actual damages in the amount of P61,200.00 for the food and refreshments spent
Pascasio grabbed her cellular phone and caused damage to it, is feeble and unrealistic. during the birthday of Pascasio, the amount of P3,000.00 for the birthday cake and
We find incredulous that Pascasio, who was allegedly infirm, would be able to grab the amount of P3,275.00 for the balloon arrangements should be paid as these
the cellphone from Adelaida and throw it away, when he cannot even move on his expenses were incurred by respondents for Pascasio's grand birthday celebration.
own without any assistance. And even if true, there are certainly other means of
communication aside from her cellphone if she really wanted to call the respondents. As for moral damages, the CA is correct in granting a lump sum of P300,000.00.
Moral damages are not punitive in nature but are designed to compensate and
Adelaida also neglected to contact the respondents immediately after their return to alleviate in some way the physical suffering, mental anguish, fright, serious anxiety,
Manila on February 23, 2004. If she was sincere in bringing Pascasio to his birthday besmirched reputation, wounded feelings, moral shock, social humiliation, and
celebration, then she would have immediately called the respondents upon returning similar injury unjustly caused to a person. In the instant case, the respondents clearly
to Manila to inform them of their whereabouts and to state the reason for Pascasio suffered serious anxiety, humiliation and embarrassment in front of all guests who
non-attendance. expected that Pascasio would be present in the event.

We find it dubious that Pascasio would refuse to attend his birthday celebration. The award of exemplary damages of P30,000.00 is likewise affirmed. Exemplary
Respondents have sufficiently established that it was an annual tradition for the damages, which are awarded by way of example or correction for the public good,
family to celebrate the birthday of their father Pascasio. Besides, the allegation that may be recovered if a person acted in a wanton, fraudulent, reckless, oppressive, or
Pascasio refused to attend his birthday celebration because of an alleged malevolent manner towards another party, as in this case. The aim of awarding
misunderstanding with his two sons was not duly proven. Common sense dictates that exemplary damages is to deter serious wrongdoings.
he should have conveyed about the matter to Reina and Gracia Severa when they
visited him on February 14 and 15, 2004, but he did not. By the same token, the CA correctly awarded attorney's fees in the amount of
P50,000.00 in favor of the respondents considering that they were constrained to file
All in all, the foregoing shows that Adelaida intentionally failed to bring Pascasio to a case because of petitioner's acts characterized by bad faith, malice and wanton
the birthday celebration prepared by the respondents thus violating Article 19 of the attitude which were intentional to inflict damage upon the former.
Civil Code on the principle of abuse of right. Her failure to observe good faith in the
exercise of her right as the wife of Pascasio caused loss and injury on the part of the WHEREFORE, the Petition is DENIED. The October 15, 2014 of the Court of
respondents, for which they must be compensated by way of damages pursuant to Appeals is AFFIRMED.
Article 21 of the Civil Code.
SO ORDERED.
Actual damages are compensation for an injury that will put the injured party in the
position where he/she was before the injury. They pertain to such injuries or losses G.R. No. 127358 March 31, 2005
that are actually sustained and susceptible of measurement. Except as provided by
law or stipulation, a party is entitled to adequate compensation only for such
pecuniary loss as is duly proven. Basic is the rule that to recover actual damages, not NOEL BUENAVENTURA, Petitioner,
only must the amount of loss be capable of proof; it must also be actually proven with vs.
a reasonable degree of certainty, premised upon competent proof or the best evidence
obtainable. COURT OF APPEALS and ISABEL LUCIA SINGH
BUENAVENTURA, respondents.
We find proper the modification made by the CA to delete the award of $3,619.00
(US Dollars) as actual damages for lack of factual and legal bases. We also agree that
x-------------------x 4) Ordering the liquidation of the assets of the conjugal partnership property[,]
particularly the plaintiff’s separation/retirement benefits received from the Far East
Bank [and] Trust Company[,] by ceding, giving and paying to her fifty percent (50%)
G.R. No. 127449 March 31, 2005 of the net amount of P3,675,335.79 or P1,837,667.89 together with 12% interest per
annum from the date of this decision and one-half (1/2) of his outstanding shares of
stock with Manila Memorial Park and Provident Group of Companies;
NOEL BUENAVENTURA, Petitioner,
vs. 5) Ordering him to give a regular support in favor of his son Javy Singh
COURT OF APPEALS and ISABEL LUCIA SINGH BUENAVENTURA, Buenaventura in the amount of P15,000.00 monthly, subject to modification as the
Respondents. necessity arises;
DECISION 6) Awarding the care and custody of the minor Javy Singh Buenaventura to his
mother, the herein defendant; and
AZCUNA, J.:
7) Hereby authorizing the defendant to revert back to the use of her maiden family
These cases involve a petition for the declaration of nullity of marriage, which was name Singh.
filed by petitioner Noel Buenaventura on July 12, 1992, on the ground of the alleged
psychological incapacity of his wife, Isabel Singh Buenaventura, herein respondent. Let copies of this decision be furnished the appropriate civil registry and registries of
After respondent filed her answer, petitioner, with leave of court, amended his properties.
petition by stating that both he and his wife were psychologically incapacitated to
comply with the essential obligations of marriage. In response, respondent filed an SO ORDERED.
amended answer denying the allegation that she was psychologically incapacitated.
Petitioner appealed the above decision to the Court of Appeals. While the case was
On July 31, 1995, the Regional Trial Court promulgated a Decision, the dispositive pending in the appellate court, respondent filed a motion to increase the P15,000
portion of which reads: monthly support pendente lite of their son Javy Singh Buenaventura. Petitioner filed
an opposition thereto, praying that it be denied or that such incident be set for oral
WHEREFORE, judgment is hereby rendered as follows: argument.
1) Declaring and decreeing the marriage entered into between plaintiff Noel A. On September 2, 1996, the Court of Appeals issued a Resolution increasing the
Buenaventura and defendant Isabel Lucia Singh Buenaventura on July 4, 1979, null support pendente lite to P20,000. Petitioner filed a motion for reconsideration
and void ab initio; questioning the said Resolution.
2) Ordering the plaintiff to pay defendant moral damages in the amount of 2.5 million On October 8, 1996, the appellate court promulgated a Decision dismissing
pesos and exemplary damages of 1 million pesos with 6% interest from the date of petitioner’s appeal for lack of merit and affirming in toto the trial court’s decision.
this decision plus attorney’s fees of P100,000.00; Petitioner filed a motion for reconsideration which was denied. From the
abovementioned Decision, petitioner filed the instant Petition for Review on
3) Ordering the plaintiff to pay the defendant expenses of litigation of P50,000.00, Certiorari.
plus costs;
On November 13, 1996, through another Resolution, the Court of Appeals denied
petitioner’s motion for reconsideration of the September 2, 1996 Resolution, which THE COURT OF APPEALS GRAVELY ABUSED ITS DISCRETION WHEN IT
increased the monthly support for the son. Petitioner filed a Petition for Certiorari to REFUSED TO SET RESPONDENT’S MOTION FOR INCREASED SUPPORT
question these two Resolutions. FOR THE PARTIES’ SON FOR HEARING.

On July 9, 1997, the Petition for Review on Certiorari and the Petition for Certiorari THERE WAS NO NEED FOR THE COURT OF APPEALS TO INCREASE
were ordered consolidated by this Court. JAVY’S MONTHLY SUPPORT OF P15,000.00 BEING GIVEN BY PETITIONER
EVEN AT PRESENT PRICES.
In the Petition for Review on Certiorari petitioner claims that the Court of Appeals
decided the case not in accord with law and jurisprudence, thus: IN RESOLVING RESPONDENT’S MOTION FOR THE INCREASE OF JAVY’S
SUPPORT, THE COURT OF APPEALS SHOULD HAVE EXAMINED THE LIST
1. WHEN IT AWARDED DEFENDANT-APPELLEE MORAL DAMAGES IN OF EXPENSES SUBMITTED BY RESPONDENT IN THE LIGHT OF
THE AMOUNT OF P2.5 MILLION AND EXEMPLARY DAMAGES OF P1 PETITIONER’S OBJECTIONS THERETO, INSTEAD OF MERELY ASSUMING
MILLION, WITH 6% INTEREST FROM THE DATE OF ITS DECISION, THAT JAVY IS ENTITLED TO A P5,000 INCREASE IN SUPPORT AS SAID
WITHOUT ANY LEGAL AND MORAL BASIS; AMOUNT IS "TOO MINIMAL."

2. WHEN IT AWARDED P100,000.00 ATTORNEY’S FEES AND P50,000.00 LIKEWISE, THE COURT OF APPEALS SHOULD HAVE GIVEN PETITIONER
EXPENSES OF LITIGATION, PLUS COSTS, TO DEFENDANT-APPELLEE, AN OPPORTUNITY TO PROVE HIS PRESENT INCOME TO SHOW THAT HE
WITHOUT FACTUAL AND LEGAL BASIS; CANNOT AFFORD TO INCREASE JAVY’S SUPPORT.

3. WHEN IT ORDERED PLAINTIFF-APPELLANT NOEL TO PAY With regard to the first issue in the main case, the Court of Appeals articulated:
DEFENDANT-APPELLEE ONE-HALF OR P1,837,667.89 OUT OF HIS
RETIREMENT BENEFITS RECEIVED FROM THE FAR EAST BANK AND On Assignment of Error C, the trial court, after findings of fact ascertained from the
TRUST CO., WITH 12% INTEREST THEREON FROM THE DATE OF ITS testimonies not only of the parties particularly the defendant-appellee but likewise,
DECISION, NOTWITHSTANDING THAT SAID RETIREMENT BENEFITS ARE those of the two psychologists, awarded damages on the basis of Articles 21, 2217
GRATUITOUS AND EXCLUSIVE PROPERTY OF NOEL, AND ALSO TO and 2229 of the Civil Code of the Philippines.
DELIVER TO DEFENDANT-APPELLEE ONE-HALF OF HIS SHARES OF
STOCK WITH THE MANILA MEMORIAL PARK AND THE PROVIDENT Thus, the lower court found that plaintiff-appellant deceived the defendant-appellee
GROUP OF COMPANIES, ALTHOUGH SAID SHARES OF STOCK WERE into marrying him by professing true love instead of revealing to her that he was
ACQUIRED BY NOEL BEFORE HIS MARRIAGE TO RESPONDENT ISABEL under heavy parental pressure to marry and that because of pride he married
AND ARE, THEREFORE, AGAIN HIS EXCLUSIVE PROPERTIES; AND defendant-appellee; that he was not ready to enter into marriage as in fact his career
was and always would be his first priority; that he was unable to relate not only to
4. WHEN IT AWARDED EXCLUSIVE CARE AND CUSTODY OVER THE defendant-appellee as a husband but also to his son, Javy, as a father; that he had no
PARTIES’ MINOR CHILD TO DEFENDANT-APPELLEE WITHOUT ASKING inclination to make the marriage work such that in times of trouble, he chose the
THE CHILD (WHO WAS ALREADY 13 YEARS OLD AT THAT TIME) HIS easiest way out, that of leaving defendant–appellee and their son; that he had no
CHOICE AS TO WHOM, BETWEEN HIS TWO PARENTS, HE WOULD LIKE desire to keep defendant-appellee and their son as proved by his reluctance and later,
TO HAVE CUSTODY OVER HIS PERSON. refusal to reconcile after their separation; that the aforementioned caused defendant-
appellee to suffer mental anguish, anxiety, besmirched reputation, sleepless nights not
In the Petition for Certiorari, petitioner advances the following contentions:
only in those years the parties were together but also after and throughout their On the other hand, the trial court declared the marriage of the parties null and void
separation. based on Article 36 of the Family Code, due to psychological incapacity of the
petitioner, Noel Buenaventura. Article 36 of the Family Code states:
Plaintiff-appellant assails the trial court’s decision on the ground that unlike those
arising from a breach in ordinary contracts, damages arising as a consequence of A marriage contracted by any party who, at the time of the celebration, was
marriage may not be awarded. While it is correct that there is, as yet, no decided case psychologically incapacitated to comply with the essential marital obligations of
by the Supreme Court where damages by reason of the performance or non- marriage, shall likewise be void even if such incapacity becomes manifest only after
performance of marital obligations were awarded, it does not follow that no such its solemnization.
award for damages may be made.
Psychological incapacity has been defined, thus:
Defendant-appellee, in her amended answer, specifically prayed for moral and
exemplary damages in the total amount of 7 million pesos. The lower court, in the . . . no less than a mental (not physical) incapacity that causes a party to be truly
exercise of its discretion, found full justification of awarding at least half of what was incognitive of the basic marital covenants that concomitantly must be assumed and
originally prayed for. We find no reason to disturb the ruling of the trial court. discharged by the parties to the marriage which, as so expressed by Article 68 of the
Family Code, include their mutual obligations to live together, observe love, respect
The award by the trial court of moral damages is based on Articles 2217 and 21 of the and fidelity and render help and support. There is hardly any doubt that the
Civil Code, which read as follows: intendment of the law has been to confine the meaning of "psychological incapacity"
to the most serious cases of personality disorders clearly demonstrative of an utter
ART. 2217. Moral damages include physical suffering, mental anguish, fright, serious insensitivity or inability to give meaning and significance to the marriage. . . .
anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation,
and similar injury. Though incapable of pecuniary computation, moral damages may The Court of Appeals and the trial court considered the acts of the petitioner after the
be recovered if they are the proximate result of the defendant’s wrongful act or marriage as proof of his psychological incapacity, and therefore a product of his
omission. incapacity or inability to comply with the essential obligations of marriage.
Nevertheless, said courts considered these acts as willful and hence as grounds for
ART. 21. Any person who wilfully causes loss or injury to another in a manner that is granting moral damages. It is contradictory to characterize acts as a product of
contrary to morals, good customs or public policy shall compensate the latter for the psychological incapacity, and hence beyond the control of the party because of an
damage. innate inability, while at the same time considering the same set of acts as willful. By
declaring the petitioner as psychologically incapacitated, the possibility of awarding
The trial court referred to Article 21 because Article 2217 of the Civil Code moral damages on the same set of facts was negated. The award of moral damages
enumerates the cases in which moral damages may be recovered and it mentions should be predicated, not on the mere act of entering into the marriage, but on
Article 21 as one of the instances. It must be noted that Article 21 states that the specific evidence that it was done deliberately and with malice by a party who had
individual must willfully cause loss or injury to another. There is a need that the act is knowledge of his or her disability and yet willfully concealed the same. No such
willful and hence done in complete freedom. In granting moral damages, therefore, evidence appears to have been adduced in this case.
the trial court and the Court of Appeals could not but have assumed that the acts on
which the moral damages were based were done willfully and freely, otherwise the For the same reason, since psychological incapacity means that one is truly
grant of moral damages would have no leg to stand on. incognitive of the basic marital covenants that one must assume and discharge as a
consequence of marriage, it removes the basis for the contention that the petitioner
purposely deceived the private respondent. If the private respondent was deceived, it
was not due to a willful act on the part of the petitioner. Therefore, the award of The third issue that must be resolved by the Court is what to do with the assets of the
moral damages was without basis in law and in fact. conjugal partnership in the event of declaration of annulment of the marriage. The
Honorable Supreme Court has held that the declaration of nullity of marriage carries
Since the grant of moral damages was not proper, it follows that the grant of ipso facto a judgment for the liquidation of property (Domingo v. Court of Appeals,
exemplary damages cannot stand since the Civil Code provides that exemplary et al., G.R. No. 104818, Sept. 17, 1993, 226 SCRA, pp. 572 – 573, 586). Thus,
damages are imposed in addition to moral, temperate, liquidated or compensatory speaking through Justice Flerida Ruth P. Romero, it was ruled in this case:
damages.
When a marriage is declared void ab initio, the law states that the final judgment
With respect to the grant of attorney’s fees and expenses of litigation the trial court therein shall provide for the liquidation, partition and distribution of the properties of
explained, thus: the spouses, the custody and support of the common children and the delivery of their
presumptive legitimes, unless such matters had been adjudicated in the previous
Regarding Attorney’s fees, Art. 2208 of the Civil Code authorizes an award of proceedings.
attorney’s fees and expenses of litigation, other than judicial costs, when as in this
case the plaintiff’s act or omission has compelled the defendant to litigate and to incur The parties here were legally married on July 4, 1979, and therefore, all property
expenses of litigation to protect her interest (par. 2), and where the Court deems it just acquired during the marriage, whether the acquisition appears to have been made,
and equitable that attorney’s fees and expenses of litigation should be recovered. (par. contracted or registered in the name of one or both spouses, is presumed to be
11) conjugal unless the contrary is proved (Art. 116, New Family Code; Art. 160, Civil
Code). Art. 117 of the Family Code enumerates what are conjugal partnership
The Court of Appeals reasoned as follows: properties. Among others they are the following:

On Assignment of Error D, as the award of moral and exemplary damages is fully 1) Those acquired by onerous title during the marriage at the expense of the common
justified, the award of attorney’s fees and costs of litigation by the trial court is fund, whether the acquisition be for the partnership, or for only one of the spouses;
likewise fully justified.
2) Those obtained from the labor, industry, work or profession of either or both of the
The acts or omissions of petitioner which led the lower court to deduce his spouses;
psychological incapacity, and his act in filing the complaint for the annulment of his
marriage cannot be considered as unduly compelling the private respondent to 3) The fruits, natural, industrial, or civil, due or received during the marriage from the
litigate, since both are grounded on petitioner’s psychological incapacity, which as common property, as well as the net fruits from the exclusive property of each
explained above is a mental incapacity causing an utter inability to comply with the spouse. . . .
obligations of marriage. Hence, neither can be a ground for attorney’s fees and
litigation expenses. Furthermore, since the award of moral and exemplary damages is Applying the foregoing legal provisions, and without prejudice to requiring an
no longer justified, the award of attorney’s fees and expenses of litigation is left inventory of what are the parties’ conjugal properties and what are the exclusive
without basis. properties of each spouse, it was disclosed during the proceedings in this case that the
plaintiff who worked first as Branch Manager and later as Vice-President of Far East
Anent the retirement benefits received from the Far East Bank and Trust Co. and the Bank & Trust Co. received separation/retirement package from the said bank in the
shares of stock in the Manila Memorial Park and the Provident Group of Companies, amount of P3,701,500.00 which after certain deductions amounting to P26,164.21
the trial court said: gave him a net amount of P3,675,335.79 and actually paid to him on January 9, 1995
(Exhs. 6, 7, 8, 9, 10, 11). Not having shown debts or obligations other than those
deducted from the said retirement/separation pay, under Art. 129 of the Family Code
"The net remainder of the conjugal partnership properties shall constitute the profits, On August 6, 1993, the trial court rendered a Partial Decision approving the
which shall be divided equally between husband and wife, unless a different Compromise Agreement entered into by the parties. In the same Compromise
proportion or division was agreed upon in the marriage settlement or unless there has Agreement, the parties had agreed that henceforth, their conjugal partnership is
been a voluntary waiver or forfeiture of such share as provided in this Code." In this dissolved. Thereafter, no steps were taken for the liquidation of the conjugal
particular case, however, there had been no marriage settlement between the parties, partnership.
nor had there been any voluntary waiver or valid forfeiture of the defendant wife’s
share in the conjugal partnership properties. The previous cession and transfer by the Finding that defendant-appellee is entitled to at least half of the separation/retirement
plaintiff of his one-half (1/2) share in their residential house and lot covered by benefits which plaintiff-appellant received from Far East Bank & Trust Company
T.C.T. No. S-35680 of the Registry of Deeds of Parañaque, Metro Manila, in favor of upon his retirement as Vice-President of said company for the reason that the benefits
the defendant as stipulated in their Compromise Agreement dated July 12, 1993, and accrued from plaintiff–appellant’s service for the bank for a number of years, most of
approved by the Court in its Partial Decision dated August 6, 1993, was actually which while he was married to defendant-appellee, the trial court adjudicated the
intended to be in full settlement of any and all demands for past support. In reality, same. The same is true with the outstanding shares of plaintiff-appellant in Manila
the defendant wife had allowed some concession in favor of the plaintiff husband, for Memorial Park and Provident Group of Companies. As these were acquired by the
were the law strictly to be followed, in the process of liquidation of the conjugal plaintiff-appellant at the time he was married to defendant-appellee, the latter is
assets, the conjugal dwelling and the lot on which it is situated shall, unless otherwise entitled to one-half thereof as her share in the conjugal partnership. We find no reason
agreed upon by the parties, be adjudicated to the spouse with whom their only child to disturb the ruling of the trial court.
has chosen to remain (Art. 129, par. 9). Here, what was done was one-half (1/2)
portion of the house was ceded to defendant so that she will not claim anymore for Since the present case does not involve the annulment of a bigamous marriage, the
past unpaid support, while the other half was transferred to their only child as his provisions of Article 50 in relation to Articles 41, 42 and 43 of the Family Code,
presumptive legitime. providing for the dissolution of the absolute community or conjugal partnership of
gains, as the case may be, do not apply. Rather, the general rule applies, which is that
Consequently, nothing yet has been given to the defendant wife by way of her share in case a marriage is declared void ab initio, the property regime applicable and to be
in the conjugal properties, and it is but just, lawful and fair, that she be given one-half liquidated, partitioned and distributed is that of equal co-ownership.
(1/2) share of the separation/retirement benefits received by the plaintiff the same
being part of their conjugal partnership properties having been obtained or derived In Valdes v. Regional Trial Court, Branch 102, Quezon City, this Court expounded
from the labor, industry, work or profession of said defendant husband in accordance on the consequences of a void marriage on the property relations of the spouses and
with Art. 117, par. 2 of the Family Code. For the same reason, she is entitled to one- specified the applicable provisions of law:
half (1/2) of the outstanding shares of stock of the plaintiff husband with the Manila
Memorial Park and the Provident Group of Companies. The trial court correctly applied the law. In a void marriage, regardless of the cause
thereof, the property relations of the parties during the period of cohabitation is
The Court of Appeals articulated on this matter as follows: governed by the provisions of Article 147 or Article 148, such as the case may be, of
the Family Code. Article 147 is a remake of Article 144 of the Civil Code as
On Assignment of Error E, plaintiff-appellant assails the order of the trial court for interpreted and so applied in previous cases; it provides:
him to give one-half of his separation/retirement benefits from Far East Bank & Trust
Company and half of his outstanding shares in Manila Memorial Park and Provident ART. 147. When a man and a woman who are capacitated to marry each other, live
Group of Companies to the defendant-appellee as the latter’s share in the conjugal exclusively with each other as husband and wife without the benefit of marriage or
partnership. under a void marriage, their wages and salaries shall be owned by them in equal
shares and the property acquired by both of them through their work or industry shall
be governed by the rules on co-ownership.
 (a) Neither party can dispose or encumber by act[s] inter vivos [of] his or her share in
In the absence of proof to the contrary, properties acquired while they lived together co-ownership property, without the consent of the other, during the period of
shall be presumed to have been obtained by their joint efforts, work or industry, and cohabitation; and
shall be owned by them in equal shares. For purposes of this Article, a party who did
not participate in the acquisition by the other party of any property shall be deemed to (b) In the case of a void marriage, any party in bad faith shall forfeit his or her share
have contributed jointly in the acquisition thereof if the former's efforts consisted in in the co-ownership in favor of their common children; in default thereof or waiver by
the care and maintenance of the family and of the household. any or all of the common children, each vacant share shall belong to the respective
surviving descendants, or still in default thereof, to the innocent party. The forfeiture
Neither party can encumber or dispose by acts inter vivos of his or her share in the shall take place upon the termination of the cohabitation or declaration of nullity of
property acquired during cohabitation and owned in common, without the consent of the marriage.
the other, until after the termination of their cohabitation.
…
When only one of the parties to a void marriage is in good faith, the share of the party
in bad faith in the co-ownership shall be forfeited in favor of their common children. In deciding to take further cognizance of the issue on the settlement of the parties'
In case of default of or waiver by any or all of the common children or their common property, the trial court acted neither imprudently nor precipitately; a court
descendants, each vacant share shall belong to the respective surviving descendants. which had jurisdiction to declare the marriage a nullity must be deemed likewise
In the absence of descendants, such share shall belong to the innocent party. In all clothed with authority to resolve incidental and consequential matters. Nor did it
cases, the forfeiture shall take place upon termination of the cohabitation. commit a reversible error in ruling that petitioner and private respondent own the
"family home" and all their common property in equal shares, as well as in
This peculiar kind of co-ownership applies when a man and a woman, suffering no concluding that, in the liquidation and partition of the property owned in common by
legal impediment to marry each other, so exclusively live together as husband and them, the provisions on co-ownership under the Civil Code, not Articles 50, 51 and
wife under a void marriage or without the benefit of marriage. The term "capacitated" 52, in relation to Articles 102 and 129, of the Family Code, should aptly prevail. The
in the provision (in the first paragraph of the law) refers to the legal capacity of a rules set up to govern the liquidation of either the absolute community or the conjugal
party to contract marriage, i.e., any "male or female of the age of eighteen years or partnership of gains, the property regimes recognized for valid and voidable
upwards not under any of the impediments mentioned in Articles 37 and 38" of the marriages (in the latter case until the contract is annulled), are irrelevant to the
Code. liquidation of the co-ownership that exists between common-law spouses. The first
paragraph of Article 50 of the Family Code, applying paragraphs (2), (3), (4) and (5)
Under this property regime, property acquired by both spouses through their work of Article 43, relates only, by its explicit terms, to voidable marriages and,
and industry shall be governed by the rules on equal co-ownership. Any property exceptionally, to void marriages under Article 40 of the Code, i.e., the declaration of
acquired during the union is prima facie presumed to have been obtained through nullity of a subsequent marriage contracted by a spouse of a prior void marriage
their joint efforts. A party who did not participate in the acquisition of the property before the latter is judicially declared void. The latter is a special rule that somehow
shall still be considered as having contributed thereto jointly if said party's "efforts recognizes the philosophy and an old doctrine that void marriages are inexistent from
consisted in the care and maintenance of the family household." Unlike the conjugal the very beginning and no judicial decree is necessary to establish their nullity. In
partnership of gains, the fruits of the couple's separate property are not included in the now requiring for purposes of remarriage, the declaration of nullity by final judgment
co-ownership. of the previously contracted void marriage, the present law aims to do away with any
continuing uncertainty on the status of the second marriage. It is not then illogical for
Article 147 of the Family Code, in substance and to the above extent, has clarified the provisions of Article 43, in relation to Articles 41 and 42, of the Family Code, on
Article 144 of the Civil Code; in addition, the law now expressly provides that — the effects of the termination of a subsequent marriage contracted during the
subsistence of a previous marriage to be made applicable pro hac vice. In all other
cases, it is not to be assumed that the law has also meant to have coincident property The Petition for Review on Certiorari (G.R. No. 127358) contesting the Court of
relations, on the one hand, between spouses in valid and voidable marriages (before Appeals’ Resolutions of September 2, 1996 and November 13, 1996 which increased
annulment) and, on the other, between common-law spouses or spouses of void the support pendente lite in favor of the parties’ son, Javy Singh Buenaventura, is
marriages, leaving to ordain, in the latter case, the ordinary rules on co-ownership now MOOT and ACADEMIC and is, accordingly, DISMISSED.
subject to the provision of Article 147 and Article 148 of the Family Code. It must be
stressed, nevertheless, even as it may merely state the obvious, that the provisions of No costs.
the Family Code on the "family home," i.e., the provisions found in Title V, Chapter
2, of the Family Code, remain in force and effect regardless of the property regime of SO ORDERED.
the spouses.

Since the properties ordered to be distributed by the court a quo were found, both by G.R. No. 174715               October 11, 2012
the trial court and the Court of Appeals, to have been acquired during the union of the
parties, the same would be covered by the co-ownership. No fruits of a separate FILINVEST LAND, INC., EFREN C. GUTIERRE and LINA DE
property of one of the parties appear to have been included or involved in said
distribution. The liquidation, partition and distribution of the properties owned in
GUZMAN-FERRER, Petitioners,
common by the parties herein as ordered by the court a quo should, therefore, be vs.
sustained, but on the basis of co-ownership and not of the regime of conjugal ABDUL BACKY, ABEHERA, BAIYA, EDRIS, HADJI GULAM,
partnership of gains. JAMELLA, KIRAM, LUCAYA, MONER, OMAR, RAMIR,
ROBAYCA, SATAR, TAYBA ALL SURNAMED NGILAY, EDMER
As to the issue on custody of the parties over their only child, Javy Singh ANDONG, UNOS BANTANGAN and NADJER
Buenaventura, it is now moot since he is about to turn twenty-five years of age on
May 27, 2005 and has, therefore, attained the age of majority.
ESQUIVEL, Respondents.

With regard to the issues on support raised in the Petition for Certiorari, these would DECISION
also now be moot, owing to the fact that the son, Javy Singh Buenaventura, as
previously stated, has attained the age of majority. PERALTA, J.:

WHEREFORE, the Decision of the Court of Appeals dated October 8, 1996 and its For this Court's consideration is the Petition for Review on Certiorari under Rule 45,
Resolution dated December 10, 1996 which are contested in the Petition for Review dated November 9, 2006, of petitioner Filinvest Land, Inc., which seeks to set aside the
Decision dated March 30, 2006 and Resolution dated September 18, 2006 of the Court
1  2 

(G.R. No. 127449), are hereby MODIFIED, in that the award of moral and exemplary
of Appeals (CA) partially reversing the Decision dated October 1, 2003 of the Regional
3 

damages, attorney’s fees, expenses of litigation and costs are deleted. The order Trial Court, Las Piñas, Branch 253 (RTC).
giving respondent one-half of the retirement benefits of petitioner from Far East Bank
and Trust Co. and one-half of petitioner’s shares of stock in Manila Memorial Park The factual antecedents, as found in the records follow.
and in the Provident Group of Companies is sustained but on the basis of the
liquidation, partition and distribution of the co-ownership and not of the regime of Respondents were grantees of agricultural public lands located in Tambler, General
conjugal partnership of gains. The rest of said Decision and Resolution are Santos City through Homestead and Fee patents sometime in 1986 and 1991 which are
AFFIRMED. covered by and specifically described in the following Original Certificates of Title issued
by the Register of Deeds of General Santos City:
 OCT No. Area (sq. m.) Grantee Date Granted case for the declaration of nullity of the deeds of conditional and absolute sale of the
questioned properties and the grant of right of way with the RTC, Las Piñas, Branch 253.
P-5204 38,328 Abdul Backy Ngilay November 11, 1986
P-5205 49,996 Hadji Gulam Ngilay November 11, 1986 On the other hand, petitioner claims that sometime in 1995, the representative of Hadji
Ngilay approached petitioner to propose the sale of a portion of his properties.
P-5206 49,875 Edris A. Ngilay November 11, 1986 Thereafter, representatives of petitioner flew to General Santos City from Manila to
conduct an ocular inspection of the subject properties. Petitioner was willing to purchase
P-5207 44,797 Robayca A. Ngilay November 11, 1986 the properties but seeing that some of the properties were registered as land grants
P-5209 20,000 Omar Ngilay November 11, 1986 through homestead patents, representatives of petitioner informed Ngilay that they would
return to General Santos City in a few months to finalize the sale as ten (10) certificates
P-5211 29,990 Tayba Ngilay November 11, 1986 of title were issued on November 24, 1991.
P-5212 48,055 Kiram Ngilay November 11, 1986
According to petitioner, Ngilay and his children prevailed upon the representatives of
P-5578 20,408 Nadjer Esquevel November 24, 1991 petitioner to make an advance payment. To accommodate the Ngilays, petitioner
acceded to making an advance with the understanding that petitioner could demand
P-5579 35,093 Unos Bantangan November 24, 1991 anytime the return of the advance payment should Ngilay not be able to comply with the
P-5580 39,507 Moner Ngilay November 24, 1991 conditions of the sale. The Ngilays likewise undertook to secure the necessary approvals
of the DENR before the consummation of the sale.
P-5582 44,809 Baiya Ngilay November 24, 1991
P-5583 10,050 Jamela Ngilay November 24, 1991 The RTC ruled in favor of Filinvest Land, Inc. and upheld the sale of all the properties in
litigation. It found that the sale of those properties whose original certificates of title were
P-5584 49,993 Ramir Ngilay November 24, 1991 issued by virtue of the 1986 Patents was valid, considering that the prohibitory period
ended in 1991, or way before the transaction took place. As to those patents awarded in
P-5586 40,703 Satar Ngilay November 24, 1991
1991, the same court opined that since those properties were the subject of a deed of
P-5590 20,000 Abehara Ngilay November 24, 1991 conditional sale, compliance with those conditions is necessary for there to be a
perfected contract between the parties. The RTC also upheld the grant of right of way as
P-5592 41,645 Lucaya Ngilay November 24, 1991 it adjudged that the right of way agreement showed that the right of way was granted to
P-5595 13,168 Edmer Andong November 24, 1991 provide access from the highway to the properties to be purchased. The dispositive
portion of the Decision dated October 1, 2003 reads:

Negotiations were made by petitioner, represented by Lina de Guzman-Ferrer with the WHEREFORE, premises considered, the Court upholds the sale of all the properties in
patriarch of the Ngilays, Hadji Gulam Ngilay sometime in 1995. Eventually, a Deed of litigation. It likewise upholds the grant of right of way in favor of the respondent.
Conditional Sale of the above- enumerated properties in favor of petitioner Filinvest Consequently, the petition is DISMISSED.
Land, Inc. was executed. Upon its execution, respondents were asked to deliver to
petitioner the original owner's duplicate copy of the certificates of title of their respective
No pronouncement as to damages for failure to prove the same.
properties. Respondents received the downpayment for the properties on October 28,
1995.
Costs against the petitioners.
A few days after the execution of the aforestated deeds and the delivery of the
corresponding documents to petitioner, respondents came to know that the sale of their SO ORDERED. 4

properties was null and void, because it was done within the period that they were not
allowed to do so and that the sale did not have the approval of the Secretary of the Respondents elevated the case to the CA in which the latter modified the judgment of the
Department of Environment and Natural Resources (DENR) prompting them to file a RTC.  While the CA upheld the validity of the sale of the properties the patents of which
1âwphi1

were awarded in 1986, including the corresponding grant of right of way for the same
lots, it nullified the disposition of those properties granted through patents in 1991 and ASSUMING THE NULLITY OF THE SALE OF THE 1991 PATENTS, THE HONORABLE
the right of way on the same properties. As to the "1991 Patents," the CA ruled that the COURT OF APPEALS SHOULD HAVE ORDERED RESPONDENTS AS A MATTER OF
contract of sale between the parties was a perfected contract, hence, the parties entered LAW TO RETURN TO PETITIONERS WHAT THEY HAVE RECEIVED. 6

into a prohibited conveyance of a homestead within the prohibitive period of five years
from the issuance of the patent. The CA Decision dated March 30, 2006 disposed the In their Comment dated March 5, 2007, respondents stated the following counter-
7 

case as follows: arguments:

WHEREFORE, the assailed Decision dated October 1, 2003 is MODIFIED: (1) The Honorable Court of Appeals did not err in holding that the Deed of
Conditional Sale and Deed of Absolute Sale for the properties covered by the
a) The Deed of Conditional Sale and Deed of Absolute Sale for the properties 1991 Patents, as well as the Right of Way Agreement thereto is null and void for
covered by the "1991 Patents", as well as the Right of Way Agreement thereto, the simplest reason that the said transactions were volatile of the Public Land
are declared null and void. The Register of Deeds of General Santos City is Act.
consequently directed to cancel the certificates of title covered by the "1991
Patents" issued in favor of appellee Filinvest and to issue new titles in favor of (2) The questions raised by the Petitioner, Filinvest Land Inc. (FLI) are
herein appellants. unsubstantial to require consideration.8

b) The sale of the properties covered by the "1986 Patents", including the In its Reply dated July 30, 2007, petitioner insists that the prohibition against alienation
9 

corresponding grant of way for said lots, are declared valid. and disposition of land covered by Homestead Patents is a prohibition against the actual
loss of the homestead within the five-year prohibitory period, not against all contracts
SO ORDERED. 5
including those that do not result in such an actual loss of ownership or possession. It
also points out that respondents themselves admit that the transfer certificates of title
Petitioners filed a Motion for Partial Reconsideration, but it was denied by the CA. covering the ten parcels of land are all dated 1998, which confirms its declaration that the
lands covered by 1991 Homestead Patents were not conveyed to Filinvest until after the
Hence, the present petition. five-year prohibitory period.

The grounds relied upon are: The petition is unmeritorious.

1. The five-year prohibitory period following the issuance of the homestead patent is
provided under Section 118 of Commonwealth Act No. 141, as amended by
Commonwealth Act No. 456, otherwise known as the Public Land Act. It bears stressing
10 

A CONDITIONAL SALE INVOLVING THE 1991 PATENTS DID NOT VIOLATE THE
that the law was enacted to give the homesteader or patentee every chance to preserve
PROHIBITION AGAINST ALIENATION OF HOMESTEADS UNDER THE PUBLIC LAND
for himself and his family the land that the State had gratuitously given to him as a
ACT SINCE NO ACTUAL TRANSFER OR DISPOSITION WAS PERFECTED UNTIL
reward for his labour in cleaning and cultivating it. Its basic objective, as the Court had
11 

ALL THE CONDITIONS OF THE DEED ARE FULFILLED.

occasion to stress, is to promote public policy that is to provide home and decent living
for destitute, aimed at providing a class of independent small landholders which is the
2. bulwark of peace and order. Hence, any act which would have the effect of removing the
12 

property subject of the patent from the hands of a grantee will be struck down for being
REGISTRATION IS THE OPERATIVE ACT THAT CONVEYS OR DISPOSES RIGHTS violative of the law.
13

IN REAL PROPERTY. BEING UNREGISTERED, THE DEED OF CONDITIONAL SALE

DID NOT CONVEY OR DISPOSE OF THE 1991 HOMESTEADS OR ANY RIGHTS In the present case, the negotiations for the purchase of the properties covered by the
THEREIN IN VIOLATION OF THE PUBLIC LAND ACT. patents issued in 1991 were made in 1995 and, eventually, an undated Deed of
Conditional Sale was executed. On October 28, 1995, respondents received the
3. downpayment of P14,000.000.00 for the properties covered by the patents issued in
1991. Applying the five-year prohibition, the properties covered by the patent issued on the down payment as they no longer have the right to keep it. The principle of unjust
November 24, 1991 could only be alienated after November 24, 1996. Therefore, the enrichment essentially contemplates payment when there is no duty to pay, and the
sale, having been consummated on October 28, 1995, or within the five-year prohibition, person who receives the payment has no right to receive it. As found by the CA and
20 

is as ruled by the CA, void. undisputed by the parties, the amount or the down payment made is P14,000,000.00
which shall also be the amount to be returned by respondents.
Petitioner argues that the correct formulation of the issue is not whether there was a
perfected contract between the parties during the period of prohibition, but whether by WHEREFORE, the Petition for Review on Certiorari dated November 9, 2006 or
such deed of conditional sale there was "alienation or encumbrance" within the petitioner Filinvest Land, Inc. is hereby DENIED. Consequently, the Decision dated
contemplation of the law. This is wrong. The prohibition does not distinguish between March 30, 2006 and Resolution dated September 18, 2006 or the Court of Appeals are
consummated and executory sale. The conditional sale entered into by the parties is still hereby AFFIRMED with the MODIFICATION that respondents return the amount of
a conveyance of the homestead patent. As correctly ruled by the CA, citing Ortega v. P14,000,000.00 given by petitioner as down payment for the sale which is ruled to be
Tan:14
void ab initio.

And, even assuming that the disputed sale was not yet perfected or consummated, still, SO ORDERED.
the transaction cannot be validated. The prohibition of the law on the sale or
encumbrance of the homestead within five years after the grant is MANDATORY. The
purpose of the law is to promote a definite policy, i.e., "to preserve and keep in the family
of the homesteader that portion of the public land which the State has gratuitously given G.R. No. 160600 January 15, 2014
to him." Thus, the law does not distinguish between executory and consummated sales.
Where the sale of a homestead was perfected within the prohibitory period of five years,
the fact that the formal deed of sale was executed after the expiration of the staid period DOMINGO GONZALO, Petitioner,
DID NOT and COULD NOT legalize a contract that was void from its inception. To hold vs.
valid such arrangement would be to throw the door open to all possible fraudulent
subterfuges and schemes which persons interested in the land given to a homesteader JOHN TARNATE, JR., Respondent.
may devise in circumventing and defeating the legal provisions prohibiting their alienation
within five years from the issuance of the patent. 15

DECISION
To repeat, the conveyance of a homestead before the expiration of the five-year
prohibitory period following the issuance of the homestead patent is null and void and
cannot be enforced, for it is not within the competence of any citizen to barter away what BERSAMIN, J.:
public policy by law seeks to preserve. 16

The doctrine of in pari delicto which stipulates that the guilty parties to an illegal
Nevertheless, petitioner does not err in seeking the return of the down payment as a contract are not entitled to any relief, cannot prevent a recovery if doing so violates
consequence of the sale having been declared void. The rule is settled that the the public policy against unjust enrichment.
declaration of nullity of a contract which is void ab initio operates to restore things to the
state and condition in which they were found before the execution thereof. Petitioner is
17 

Antecedents
correct in its argument that allowing respondents to keep the amount received from
petitioner is tantamount to judicial acquiescence to unjust enrichment. Unjust enrichment
exists "when a person unjustly retains a benefit to the loss of another, or when a person After the Department of Public Works and Highways (DPWH) had awarded on July
retains money or property of another against the fundamental principles of justice, equity 22, 1997 the contract for the improvement of the Sadsadan-Maba-ay Section of the
and good conscience." There is unjust enrichment under Article 22 of the Civil Code
18 
Mountain Province-Benguet Road in the total amount of 7 014 963 33 to his
when (1) a person is unjustly benefited, and (2) such benefit is derived at the expense of company, Gonzalo Construction, petitioner Domingo Gonzalo (Gonzalo)
or with damages to another. Thus, the sale which created the obligation of petitioner to
19 
subcontracted to respondent John Tarnate, Jr. (Tarnate) on October 15, 1997, the
pay the agreed amount having been declared void, respondents have the duty to return
supply of materials and labor for the project under the latter s business known as JNT On January 26, 2001, the RTC, opining that the deed of assignment was a valid and
Aggregates. Their agreement stipulated, among others, that Tarnate would pay to binding contract, and that Gonzalo must comply with his obligations under the deed
Gonzalo eight percent and four percent of the contract price, respectively, upon of assignment, rendered judgment in favor of Tarnate as follows:
Tarnate s first and second billing in the project.
WHEREFORE, premises considered and as prayed for by the plaintiff, John Tarnate,
In furtherance of their agreement, Gonzalo executed on April 6, 1999 a deed of Jr. in his Complaint for Sum of Money, Breach of Contract With Damages is hereby
assignment whereby he, as the contractor, was assigning to Tarnate an amount RENDERED in his favor and against the above-named defendant Domingo Gonzalo,
equivalent to 10% of the total collection from the DPWH for the project. This 10% the Court now hereby orders as follows:
retention fee (equivalent to ₱233,526.13) was the rent for Tarnate’s equipment that
had been utilized in the project. In the deed of assignment, Gonzalo further authorized 1. Defendant Domingo Gonzalo to pay the Plaintiff, John Tarnate, Jr., the amount of
Tarnate to use the official receipt of Gonzalo Construction in the processing of the TWO HUNDRED THIRTY THREE THOUSAND FIVE HUNDRED TWENTY
documents relative to the collection of the 10% retention fee and in encashing the SIX and 13/100 PESOS (₱233,526.13) representing the rental of equipment;
check to be issued by the DPWH for that purpose. The deed of assignment was
submitted to the DPWH on April 15, 1999. During the processing of the documents 2. Defendant to pay Plaintiff the sum of THIRTY THOUSAND (₱30,000.00) PESOS
for the retention fee, however, Tarnate learned that Gonzalo had unilaterally by way of reasonable Attorney’s Fees for having forced/compelled the plaintiff to
rescinded the deed of assignment by means of an affidavit of cancellation of deed of litigate and engage the services of a lawyer in order to protect his interest and to
assignment dated April 19, 1999 filed in the DPWH on April 22, 1999; and that the enforce his right. The claim of the plaintiff for attorney’s fees in the amount of FIFTY
disbursement voucher for the 10% retention fee had then been issued in the name of THOUSAND PESOS (₱50,000.00) plus THREE THOUSAND PESOS (₱3,000.00)
Gonzalo, and the retention fee released to him. clearly appears to be unconscionable and therefore reduced to Thirty Thousand Pesos
(₱30,000.00) as aforestated making the same to be reasonable;
Tarnate demanded the payment of the retention fee from Gonzalo, but to no avail.
Thus, he brought this suit against Gonzalo on September 13, 1999 in the Regional 3. Defendant to pay Plaintiff the sum of FIFTEEN THOUSAND PESOS
Trial Court (RTC) in Mountain Province to recover the retention fee of ₱233,526.13, (₱15,000.00) by way of litigation expenses;
moral and exemplary damages for breach of contract, and attorney’s fees.
4. Defendant to pay Plaintiff the sum of TWENTY THOUSAND PESOS
In his answer, Gonzalo admitted the deed of assignment and the authority given (₱20,000.00) for moral damages and for the breach of contract; and
therein to Tarnate, but averred that the project had not been fully implemented
because of its cancellation by the DPWH, and that he had then revoked the deed of 5. To pay the cost of this suit.
assignment. He insisted that the assignment could not stand independently due to its
being a mere product of the subcontract that had been based on his contract with the Award of exemplary damages in the instant case is not warranted for there is no
DPWH; and that Tarnate, having been fully aware of the illegality and ineffectuality showing that the defendant acted in a wanton, fraudulent, reckless, oppressive
of the deed of assignment from the time of its execution, could not go to court with or malevolent manner analogous to the case of Xentrex Automotive, Inc. vs. Court
unclean hands to invoke any right based on the invalid deed of assignment or on the of Appeals, 291 SCRA 66.
product of such deed of assignment.
Gonzalo appealed to the Court of Appeals (CA).
Ruling of the RTC
Decision of the CA

On February 18, 2003, the CA affirmed the RTC.

 the DPWH Secretary has approved the subcontracting or assignment. This is pursuant
Although holding that the subcontract was an illegal agreement due to its object being to Section 6 of Presidential Decree No. 1594, which provides:
specifically prohibited by Section 6 of Presidential Decree No. 1594; that Gonzalo
and Tarnate were guilty of entering into the illegal contract in violation of Section 6 Section 6. Assignment and Subcontract. – The contractor shall not assign, transfer,
of Presidential Decree No. 1594; and that the deed of assignment, being a product of pledge, subcontract or make any other disposition of the contract or any part or
and dependent on the subcontract, was also illegal and unenforceable, the CA did not interest therein except with the approval of the Minister of Public Works,
apply the doctrine of in pari delicto, explaining that the doctrine applied only if the Transportation and Communications, the Minister of Public Highways, or the
fault of one party was more or less equivalent to the fault of the other party. It found Minister of Energy, as the case may be. Approval of the subcontract shall not relieve
Gonzalo to be more guilty than Tarnate, whose guilt had been limited to the execution the main contractor from any liability or obligation under his contract with the
of the two illegal contracts while Gonzalo had gone to the extent of violating the deed Government nor shall it create any contractual relation between the subcontractor and
of assignment. It declared that the crediting of the 10% retention fee equivalent to the Government.
₱233,256.13 to his account had unjustly enriched Gonzalo; and ruled, accordingly,
that Gonzalo should reimburse Tarnate in that amount because the latter’s equipment Gonzalo, who was the sole contractor of the project in question, subcontracted the
had been utilized in the project. implementation of the project to Tarnate in violation of the statutory prohibition.
Their subcontract was illegal, therefore, because it did not bear the approval of the
Upon denial of his motion for reconsideration, Gonzalo has now come to the Court to DPWH Secretary. Necessarily, the deed of assignment was also illegal, because it
seek the review and reversal of the decision of the CA. sprung from the subcontract. As aptly observed by the CA:

Issues x x x. The intention of the parties in executing the Deed of Assignment was merely to
cover up the illegality of the sub-contract agreement. They knew for a fact that the
Gonzalo contends that the CA erred in affirming the RTC because: (1) both parties DPWH will not allow plaintiff-appellee to claim in his own name under the Sub-
were in pari delicto; (2) the deed of assignment was void; and (3) there was no Contract Agreement.
compliance with the arbitration clause in the subcontract.
Obviously, without the Sub-Contract Agreement there will be no Deed of Assignment
Gonzalo submits in support of his contentions that the subcontract and the deed of to speak of. The illegality of the Sub-Contract Agreement necessarily affects the
assignment, being specifically prohibited by law, had no force and effect; that Deed of Assignment because the rule is that an illegal agreement cannot give birth to
upon finding both him and Tarnate guilty of violating the law for executing the a valid contract. To rule otherwise is to sanction the act of entering into transaction
subcontract, the RTC and the CA should have applied the rule of in pari delicto, to the the object of which is expressly prohibited by law and thereafter execute an
effect that the law should not aid either party to enforce the illegal contract but should apparently valid contract to subterfuge the illegality. The legal proscription in such an
leave them where it found them; and that it was erroneous to accord to the parties instance will be easily rendered nugatory and meaningless to the prejudice of the
relief from their predicament. general public.

Ruling Under Article 1409 (1) of the Civil Code, a contract whose cause, object or purpose is
contrary to law is a void or inexistent contract. As such, a void contract cannot
We deny the petition for review, but we delete the grant of moral damages, attorney’s produce a valid one. To the same effect is Article 1422 of the Civil Code, which
fees and litigation expenses. declares that "a contract, which is the direct result of a previous illegal contract, is
also void and inexistent."
There is no question that every contractor is prohibited from subcontracting with or
assigning to another person any contract or project that he has with the DPWH unless
We do not concur with the CA’s finding that the guilt of Tarnate for violation of threads through society to the end that law may approach its supreme ideal which is
Section 6 of Presidential Decree No. 1594 was lesser than that of Gonzalo, for, as the the sway and dominance of justice."
CA itself observed, Tarnate had voluntarily entered into the agreements with
Gonzalo. Tarnate also admitted that he did not participate in the bidding for the There is no question that Tarnate provided the equipment, labor and materials for the
project because he knew that he was not authorized to contract with the DPWH. project in compliance with his obligations under the subcontract and the deed of
Given that Tarnate was a businessman who had represented himself in the subcontract assignment; and that it was Gonzalo as the contractor who received the payment for
as "being financially and organizationally sound and established, with the necessary his contract with the DPWH as well as the 10% retention fee that should have been
personnel and equipment for the performance of the project," he justifiably presumed paid to Tarnate pursuant to the deed of assignment. Considering that Gonzalo refused
to be aware of the illegality of his agreements with Gonzalo. For these reasons, despite demands to deliver to Tarnate the stipulated 10% retention fee that would
Tarnate was not less guilty than Gonzalo. have compensated the latter for the use of his equipment in the project, Gonzalo
would be unjustly enriched at the expense of Tarnate if the latter was to be barred
According to Article 1412 (1) of the Civil Code, the guilty parties to an illegal from recovering because of the rigid application of the doctrine of in pari delicto. The
contract cannot recover from one another and are not entitled to an affirmative relief prevention of unjust enrichment called for the exception to apply in Tarnate’s favor.
because they are in pari delicto or in equal fault. The doctrine of in pari delicto is a Consequently, the RTC and the CA properly adjudged Gonzalo liable to pay Tarnate
universal doctrine that holds that no action arises, in equity or at law, from an illegal the equivalent amount of the 10% retention fee (i.e., ₱233,526.13).
contract; no suit can be maintained for its specific performance, or to recover the
property agreed to be sold or delivered, or the money agreed to be paid, or damages Gonzalo sought to justify his refusal to turn over the ₱233,526.13 to Tarnate by
for its violation; and where the parties are in pari delicto, no affirmative relief of any insisting that he (Gonzalo) had a debt of ₱200,000.00 to Congressman Victor
kind will be given to one against the other. Dominguez; that his payment of the 10% retention fee to Tarnate was conditioned on
Tarnate paying that debt to Congressman Dominguez; and that he refused to give the
Nonetheless, the application of the doctrine of in pari delicto is not always rigid. An 10% retention fee to Tarnate because Tarnate did not pay to Congressman
accepted exception arises when its application contravenes well-established public Dominguez. His justification was unpersuasive, however, because, firstly, Gonzalo
policy. In this jurisdiction, public policy has been defined as "that principle of the law presented no proof of the debt to Congressman Dominguez; secondly, he did not
which holds that no subject or citizen can lawfully do that which has a tendency to be competently establish the agreement on the condition that supposedly bound Tarnate
injurious to the public or against the public good." to pay to Congressman Dominguez; and, thirdly, burdening Tarnate with Gonzalo’s
personal debt to Congressman Dominguez to be paid first by Tarnate would constitute
Unjust enrichment exists, according to Hulst v. PR Builders, Inc., "when a person another case of unjust enrichment.
unjustly retains a benefit at the loss of another, or when a person retains money or
property of another against the fundamental principles of justice, equity and good The Court regards the grant of moral damages, attorney’s fees and litigation expenses
conscience." The prevention of unjust enrichment is a recognized public policy of the to Tarnate to be inappropriate. We have ruled that no damages may be recovered
State, for Article 22 of the Civil Code explicitly provides that "[e]very person who under a void contract, which, being nonexistent, produces no juridical tie between the
through an act of performance by another, or any other means, acquires or comes into parties involved. It is notable, too, that the RTC and the CA did not spell out the
possession of something at the expense of the latter without just or legal ground, shall sufficient factual and legal justifications for such damages to be granted.
return the same to him." It is well to note that Article 22 "is part of the chapter of the
Civil Code on Human Relations, the provisions of which were formulated as basic Lastly, the letter and spirit of Article 22 of the Civil Code command Gonzalo to make
principles to be observed for the rightful relationship between human beings and for a full reparation or compensation to Tarnate. The illegality of their contract should
the stability of the social order; designed to indicate certain norms that spring from not be allowed to deprive Tarnate from being fully compensated through the
the fountain of good conscience; guides for human conduct that should run as golden imposition of legal interest. Towards that end, interest of 6% per annum reckoned
from September 13, 1999, the time of the judicial demand by Tarnate, is imposed on
the amount of ₱233,526.13. Not to afford this relief will make a travesty of the justice Petitioner Bliss Development Corporation (BDC) (subsequently reorganized as Home
to which Tarnate was entitled for having suffered too long from Gonzalo’s unjust Guaranty Corporation) is the registered owner of Lot No. 27, Block 30, New Capitol
enrichment. Estates I, Brgy. Matandang Balara, Diliman, Quezon City, and covered by Transfer
Certificate of Title (TCT) No. 331582. On October 19, 1984, it entered into and
WHEREFORE, we AFFIRM the decision promulgated on February 18, 2003, but executed a Deed of Sale over the said property in favor of Spouses Emiliano and
DELETE the awards of moral damages, attorney’s fees and litigation expenses; Leonila Melgazo (Sps. Melgazo), both of whom are now deceased.
IMPOSE legal interest of 6% per annum on the principal oL₱233,526.13 reckoned
from September 13, 1999; and DIRECT the petitioner to pay the costs of suit. On May 7, 1991, a certain Rodolfo Nacua (Nacua) sent a letter to BDC, saying that
Sps. Melgazo transferred to him their rights over the property. He further expressed
SO ORDERED. willingness to pay the outstanding obligations of Sps. Melgazo to BDC. Before the
property was fully paid, however, Nacua sold his rights to Olivia Garcia (Garcia),
G.R. No. 213233, August 05, 2015 through a Deed of Transfer of Rights. Later, Garcia transferred her rights to Elizabeth
Reyes (Reyes). Reyes then transferred her rights to Domingo Tapay (Tapay), who
then later sold his rights to herein respondent Montano Diaz (Diaz) for Six Hundred
BLISS DEVELOPMENT CORP./HOME GUARANTY Thousand Pesos (P600,000.00). Diaz then paid BDC the amortizations due on the
CORPORATION, Petitioner, v. MONTANO DIAZ, property, amounting to P406,915.15, and BDC issued a permit to occupy the property
in favor of Diaz. Diaz then introduced improvements on the property, amounting to
DOMINGO TAPAY, AND EDGAR H. ARREZA, P700,000.00.
Respondents.
On April 14, 1992, BDC executed a Contract to Sell in favor of Diaz. On April 15,
1994, however, BDC informed Diaz that respondent Edgar Arreza (Arreza) was
DECISION claiming that the heirs of Sps. Melgazo sold to him the rights over the property. BDC
then placed Diaz’s account in “inactive status.” To resolve the conflicting claims of
VELASCO JR., J.: Arreza and Diaz, BDC filed a complaint for Interpleader against them, before the
RTC, Makati City, Branch 146. On March 27, 1996, the Makati City RTC Branch
146 ruled that the signatures of Sps. Melgazo transferring their rights to Nacua were
The Case mere forgeries. Thus, it ruled that Arreza had a better right over the property. This
decision became final and executory.
This is a Petition for Review on Certiorari assailing the Decision of the Court of
Appeals (CA), promulgated on January 21, 2014, and its subsequent Resolution dated On August 27, 1996, Diaz filed the present complaint for sum of money against BDC
June 27, 2014, both in CA-G.R. CV No. 99179. The assailed Decision reversed and before the RTC, Makati City, Branch 59. This was later amended to include Arreza
set aside the Decision of the Regional Trial Court (RTC), Makati City, Branch 59, and Tapay as defendants. Diaz argued that BDC and Tapay’s representations led him
dated November 21, 2011, in Civil Case No. 96-1372. The assailed Resolution, to believe that he had a good title over the property, but due to the court’s ruling in
meanwhile, denied petitioner’s Motion for Reconsideration. the interpleader case, he was constrained to transfer the property to Arreza. Thus, he
prayed for the following:
The Facts
(1) For BDC and Arreza to pay him P1,106,915.58, plus interest, representing the
amount he paid for the assumption of Tapay’s rights;
(2) For Tapay to pay him P600,000.00, plus interests, representing the amount he paid
Tapay; The Decision of the CA

(3) For BDC and Tapay to pay him P500,000.00 as moral damages; In its presently assailed Decision promulgated on January 21, 2014, the CA reversed
the ruling of the RTC and, instead, ruled that Diaz is entitled to be paid
(4) For BDC to pay him P500,000 as exemplary damages; and reimbursement and damages. The CA anchored its ruling on its finding that Diaz is
both a buyer in good faith and a builder in good faith, thus:
(5) For BDC, Tapay, and Arreza to pay him P100,000 as attorney’s fees and costs of
suit. A careful examination of the records convinces Us that Diaz is both a buyer and
builder in good faith. We note that while Bliss executed a Deed of Sale with
Both BDC and Tapay argued that their respective acts were lawful and done in good Mortgage in favor of the spouses Emiliano and Leonila Melgazo, title over the
faith. Arreza filed a Motion to Dismiss, citing res judicata, arguing that the claim of property was in Bliss’ name. The title remained in Bliss’ name when Tapay offered to
Diaz is a compulsory counterclaim that should have been pleaded in the Interpleader transfer his rights over the property to Diaz. Considering that the property involved is
case. The RTC denied the Motion to Dismiss, which the CA, on certiorari, affirmed. registered land, Diaz need not go beyond the title to be considered a buyer in good
When the issue reached this Court in G.R. No. 133113, this Court ruled that the claim faith. Indeed, after Diaz accepted Tapay’s offer, he dealt directly with Bliss which
as against Arreza is barred by res judicata. The Court upheld the argument that the received the monthly amortizations due on the property. For almost three years, from
claim is in the nature of a compulsory counterclaim. Thus, the case against Arreza 1991 to 1994, Bliss accepted Diaz’s payment without informing Diaz of Arreza’s
was dismissed. conflicting claim over the property. Bliss even issued Diaz a permit to occupy the
property in 1992; thus, allowing Diaz to introduce improvements on the property. In
The Decision of the RTC other words, at the time when Diaz purchased the property from Tapay and when he
introduced the improvements, he had no notice that some other person has a right
After trial, the RTC rendered its Decision on November 21, 2011, finding that Diaz over the property. He also had a well-founded belief that the property he was building
failed to prove that he is an assignee in good faith, and thus dismissed the complaint on was his. Accordingly, Diaz is a buyer and builder in good faith.
for lack of merit in this wise:
In ruling that Diaz is a buyer in good faith, the CA noted that Diaz need not go
Plaintiff must show that he inquired not only into the title of the assignor but also into beyond the title to be considered a buyer in good faith, because what is involved is a
the assignor’s capacity to convey. The failure of plaintiff to diligently inquire as such, registered land.
indicated that he is not an assignee in good faith. Plaintiff Diaz downplays the need to
extend his examination to intervening transferor farther than Domingo Tapay from With regard to the liability of BDC, the CA ruled that the provision in the Contract to
whom he acquired the subject property. Such attitude, however, is not in accord with Sell excusing it from reimbursing the monthly amortizations to Diaz cannot exempt it
what a reasonably prudent person would do under the circumstances. from liability, because it acted in bad faith. The CA said:

xxxx Next, Bliss’ argument that the Additional Provision in the Contract to Sell excuses it
from reimbursing the monthly amortizations paid by Diaz cannot be given credence.
WHEREFORE, premises considered, plaintiff’s Complaint is hereby DISMISSED for Any stipulation exempting the vendor from the obligation to answer for eviction shall
lack of merit. Defendant Domingo Tapay’s [counterclaim] is likewise dismissed. No be void, if he acted in bad faith. The vendor’s bad faith consists in his knowledge
costs. beforehand at the time of the sale, of the presence of the fact giving rise to eviction,
and its possible consequence. It is undisputed that Bliss knew about Arreza’s claim in
Aggrieved, Diaz appealed to the CA. 1991. It even received amortization payments from Arreza. Yet, Bliss is aware that
should Arreza pursue his claim in court, Diaz may be evicted from the property. Yet, WHETHER THE CA ERRED IN DECLARING THAT THERE WAS UNJUST
Bliss only informed Diaz about Arreza’s claim in 1994 when Arreza followed up his ENRICHMENT ON THE PART OF BDC
claim. Indubitably, Bliss acted in bad faith in dealing with Diaz and should not be
absolved from liability by the Additional Provision in the Contract to Sell. IV.

Thus, the CA dispositively held: WHETHER DIAZ CAN STILL CLAIM REIMBURSEMENT EVEN IF UNDER
THE CONTRACT, HIS POSSESSION IS IN THE NATURE OF A LESSOR
FOR THESE REASONS, the November 21, 2011 Decision of the Regional Trial
Court of Makati City, Branch 59, is SET ASIDE. The Court hereby DIRECTS: (1) V.
Defendant-appellee Bliss Development Corporation/Home Guaranty Corporation to
PAY plaintiff-apellant Montano Diaz P1,106,915.58 for the amortizations paid and WHETHER BDC IS LIABLE TO REIMBURSE DIAZ OF THE AMOUNT OF
amount spent on improvements on the property, P100,000.00 as moral damages, P1,106,915.58
P50,000.00 as exemplary damages, and P25,000.00 as attorney’s fee; and (2)
defendant-appellee Domingo Tapay to PAY plaintiff-appellant Montano M. Diaz In fine, petitioner argues that it is not liable to respondent Diaz, both for the
P600,000.00, the amount he paid for the transfer of rights. amortizations that Diaz paid to it, and the value of the improvements that Diaz
introduced to the property.
Petitioner BDC moved for reconsideration, insisting that Diaz cannot be declared a
buyer in good faith, in light of the March 27, 1996 Decision of the Makati City RTC, Meanwhile, Tapay failed to elevate before this Court the CA’s ruling against him.
Branch 146 in the Interpleader case, which had long been final and executory. Tapay
also moved for reconsideration, arguing that he was not aware of the defect in the title The Court’s Ruling
sold to Diaz, and, hence, he should not be made liable for the P600,000.00 that Diaz
paid to him. In the CA’s assailed Resolution dated June 27, 2014,12 the CA denied The petition is partially granted. The CA committed reversible error in ruling that
both motions for reconsideration. Diaz was a buyer in good faith and for value. Nevertheless, BDC is liable to Diaz
because it acted in bad faith, as discussed below.
Hence, the present Petition for Review on Certiorari filed by BDC, raising the
following issues: The claim is not barred by the
doctrine of immutability of judgment
I.
First, We dispose of the issue of the applicability of the doctrine of immutability of
WHETHER THE CA ERRED IN NOT DISMISSING THE APPEAL, IN VIEW OF judgment, in view of the ruling of this Court in G.R. No. 133113. We find that the
THE APPLICATION OF THE DOCTRINE OF IMMUTABILITY OF present claim is not barred by the court’s ruling in G.R. No. 133113––to the effect
JUDGMENT IN THE DECISION OF THE COURT IN G.R. NO. 133113 that Diaz can no longer claim reimbursement from Arreza because of res judicata––
for his failure to allege the claim in the interpleader case between them.
II.
In G.R. No. 133113, We ruled that the claim against Arreza is barred by res judicata,
WHETHER THE CA ERRED IN DECLARING BDC IN BAD FAITH because of a prior Interpleader case between Arreza and Diaz. We ruled that the claim
for reimbursement should have been alleged and proved in the prior case, and failure
III. to do so bars any future action on such claims. We reiterated the rule on res judicata,
thus:
 basis of this claim that BDC allowed Diaz to occupy the property and pay
In cases involving res adjudicata, the parties and the causes of action are identical or amortizations accruing over the property.
substantially the same in the prior as well as the subsequent action. The judgment in
the first action is conclusive as to every matter offered and received therein and as to Nevertheless, BDC does not dispute that as early as 1991, even before respondent
any other matter admissible therein and which might have been offered for that came forward presenting the deeds of transfer to BDC, BDC was already aware of the
purpose, hence said judgment is an absolute bar to a subsequent action for the same claim of Arreza. In fact, it even received amortizations from Arreza. Despite this,
cause. The bar extends to questions necessarily involved in an issue, and necessarily BDC also later acknowledged the transfer to Diaz, and also accepted amortizations
adjudicated, or necessarily implied in the final judgment, although no specific finding from him. This uncontroverted sequence of events led the CA to correctly rule that
may have been made in reference thereto, and although such matters were directly BDC, indeed, acted in bad faith.
referred to in the pleadings and were not actually or formally presented. Said prior
judgment is conclusive in a subsequent suit between the same parties on the same When Diaz came forward and presented the deeds of transfer, including the deed of
subject matter, and on the same cause of action, not only as to matters which were transfer executed by Tapay in his favor, BDC was already well aware of a conflicting
decided in the first action, but also as to every other matter which the parties could claim by Arreza. Instead of waiting for the resolution on the matter, BDC
have properly set up in the prior suit. (emphasis added) immediately accepted the deed of transfer presented by Diaz, as well as the
amortizations he paid over the property. It was only in 1994 that BDC filed the
In the case at bar, We find that the essential elements of res judicata are not present. Interpleader case to resolve the conflicting case. This is nothing short of evident bad
First, the interpleader case was between Arreza and Diaz. While it was BDC that faith.
initiated the interpleader case, the opposing parties in that prior case is, in fact, Arreza
and Diaz. Second, the issues resolved in the interpleader case revolved around the Respondent Diaz is not a purchaser
conflicting claims of Arreza and Diaz, and not whatever claim either of them may for value and in good faith
have against BDC. Thus, there is no identity of parties, nor identity of subject matter,
between the interpleader case and the one at bar. We, however, fail to find sufficient basis for the CA’s ruling that Diaz is a purchaser
for value and in good faith. In a long line of cases, this Court had ruled that a
Petitioner BDC acted in bad faith purchaser in good faith and for value is one who buys property of another without
in dealing with respondent Diaz notice that some other person has a right to, or interest in, such property and pays full
and fair price for the same at the time of such purchase or before he or she has notice
On the second issue, We find that the CA committed no reversible error in finding of the claim or interest of some other person in the property. For one to be considered
that BDC acted in bad faith, when it allowed Diaz to take over the payment of the a purchaser in good faith, the following requisites must concur: (1) that the purchaser
amortizations over the subject property. As the CA correctly noted, “It is undisputed buys the property of another without notice that some other person has a right to or
that Bliss knew about Arreza’s claim in 1991. It even received amortization payments interest in such property; and (2) that the purchaser pays a full and fair price for the
from Arreza. Yet, Bliss acknowledged the transfer to Diaz and received the monthly property at the time of such purchase or before he or she has notice of the claim of
amortizations paid by Diaz. Also, Bliss is aware that should Arreza pursue his claim another. We find that in the case at bar, the first element is lacking.
in court, Diaz may be evicted from the property.”
The CA, in disposing the issue of Diaz’s good faith, merely said that “considering
BDC anchors its claim of good faith on the fact that it did not act as seller to Diaz. that the property involved is registered land, Diaz need not go beyond the title to be
Rather, BDC claims, it was Diaz who came forward and presented himself to BDC as considered a buyer in good faith.” We find this to be a serious and reversible error on
the lawful successor-in-interest of Emiliano and Leonila Melgazo, by virtue of the the part of the CA. In the first place, while it is true that the subject lot is registered
several deeds of transfer of rights, all of which he presented to BDC. It was on the lot, the doctrine of not going beyond the face of the title does not apply in the case
here, because what was subjected to a series of sales was not the lot itself but the right
to purchase the lot from BDC. The CA itself observed: “while [BDC] executed a Allowing BDC to keep the amortizations paid by Diaz is tantamount to unjust
Deed of Sale with Mortgage in favor of the spouses Emiliano and Leonila Melgazo, enrichment. It would result in BDC receiving amortizations twice the amount it
title over the property was in [BDC’s] name. The title remained in [BDC’s] name should have received, that is, the amortizations paid by Diaz and Arreza. While BDC
when Tapay offered to transfer his rights over the property to Diaz.” Notably, the claims that it did not receive amortizations from both Diaz and Arreza covering the
several transfers themselves did not purport to be Deeds of Absolute Sale, but merely same period, such a claim is self-serving, and is not amply supported by any
deeds of assignment of rights. The subject of those deeds of assignment was never the documentary evidence.
real right over the subject property, but merely the personal right to purchase it.
Therefore, the mirror doctrine finds no application in the case at bar. Even if BDC can prove that there was no overlap between the payments made by
Diaz and those made by Arreza, allowing it to keep the amortizations paid by Diaz
A careful review of the records of this case reveals that Diaz, in fact, failed to still amounts to unjust enrichment. As a direct result of the final and executory ruling
diligently inquire into the title of his predecessor before entering into the contract of that Arreza is the rightful buyer of the subject property, the buyer-seller relationship
sale. As such, he cannot be considered a buyer in good faith. There is no issue that between Diaz and BDC is rendered null and void. Consequently, there remains no
despite the several transfers of rights from Nacua to Garcia to Reyes to Tapay to valid consideration whatsoever for the payments made by Diaz to BDC. There being
Diaz, title over the property remained in BDC’s name. When Diaz transacted with no indication of intent to donate, because such payments were made under the
Tapay, it was also clear that what was being transferred was merely rights to purchase impression that Diaz is the rightful buyer of the property, it is only but just that Diaz
the property, and not title over the lot itself; if it were, the sale would have been void be allowed to claim back what he has paid. This is only a natural consequence of the
because Tapay never had ownership over the subject property. As the buyer in such a final and executory ruling that Diaz is not the rightful buyer of the subject property.
transaction, it was incumbent upon Diaz not only to inquire as to the right of Tapay to Allowing BDC to keep such payments, at the expense of and to the damage of Diaz,
transfer his rights, but also to trace the source of that right to purchase the property. still amounts to unjust enrichment.
Had he discharged this duty diligently, he would have found out that Nacua’s right
was without basis, because it was founded on a forged deed. For his failure to inquire Both parties being in bad faith,
diligently and trace the source of the right to purchase the property, Diaz cannot claim BDC is liable to Diaz for the value
to be a purchaser in good faith and for value. of the improvements he introduced
on the subject property
Petitioner BDC is liable to return the
amortizations paid by respondent Diaz, Next, We resolve the issue of whether BDC is liable to Diaz for the value of the
under the doctrine of unjust enrichment improvements that Diaz introduced to the property. Arts. 448, 453, 546, and 548 of
the Civil Code are material in resolving the issue:
Notwithstanding the fact that Diaz is not an innocent purchaser in good faith and for
value, BDC is nevertheless liable to return to him the amortizations which he already Art. 448. The owner of the land on which anything has been built, sown or planted in
paid on the property, applying the rule on unjust enrichment. good faith, shall have the right to appropriate as his own the works, sowing or
planting, after payment of the indemnity provided for in Articles 546 and 548, or to
Unjust enrichment exists when a person unjustly retains a benefit to the loss of oblige the one who built or planted to pay the price of the land, and the one who
another, or when a person retains money or property of another against the sowed, the proper rent. However, the builder or planter cannot be obliged to buy the
fundamental principles of justice, equity and good conscience. Under Article 22 of land if its value is considerably more than that of the building or trees. In such case,
the Civil Code, there is unjust enrichment when (1) a person is unjustly benefited and he shall pay reasonable rent, if the owner of the land does not choose to appropriate
(2) such benefit is derived at the expense of or with damages to another. the building or trees after proper indemnity. The parties shall agree upon the terms of
the lease and in case of disagreement, the court shall fix the terms thereof.
Art. 453. If there was bad faith, not only on the part of the person who built, planted In sum, the CA correctly reversed the ruling of the RTC, and ordered BDC to pay
or sowed on the land of another, but also on the part of the owner of such land, the Diaz the amount he paid as amortizations, as well as the value of the improvements
rights of one and the other shall be the same as though both had acted in good faith. that he introduced on the subject property. However, because both parties acted in
bad faith, there is no basis for the award of moral and exemplary damages, as well as
It is understood that there is bad faith on the part of the landowner whenever the act attorney’s fees.
was done with his knowledge and without opposition on his part.
WHEREFORE, in view of the foregoing, the January 21, 2014 Decision of the Court
Art. 546. Necessary expenses shall be refunded to every possessor; but only the of Appeals in CA-G.R. CV No. 99179 is hereby MODIFIED to read as follows: (1)
possessor in good faith may retain the thing until he has been reimbursed therefor. petitioner Bliss Development Corporation/Home Guaranty Corporation is ordered to
pay respondent Montano M. Diaz the amount of P1,106,915.58 for the amortizations
Useful expenses shall be refunded only to the possessor in good faith with the same paid and the amount spent on improvements on the property; and (2) Domingo Tapay
right of retention, the person who has defeated him in the possession having the is ordered to pay respondent Montano M. Diaz the amount of P600,000.00, the
option of refunding the amount of the expenses or of paying the increase in value amount he paid for the transfer of rights.
which the thing may have acquired by reason thereof.
SO ORDERED.
Art. 548. Expenses for pure luxury or mere pleasure shall not be refunded to the
possessor in good faith; but he may remove the ornaments with which he has [ G.R. No. 225538, October 14, 2020 ]
embellished the principal thing if it suffers no injury thereby, and if his successor in
the possession does not prefer to refund the amount expended.
YON MITORI INTERNATIONAL INDUSTRIES,*
The CA may have made the erroneous conclusion that Diaz acted in good faith, but PETITIONER, VS. UNION BANK OF THE
because BDC equally acted in bad faith, Art. 453 of the Civil Code commands that
the rights of one and the other shall be the same as though both had acted in good PHILIPPINES, RESPONDENT.
faith. The CA made the correct observation then, when it said:
DECISION
Under Article 448, the landowner is given the option, either to appropriate the
improvement as his own upon payment of the proper amount of indemnity or to sell
the land to the possessor in good faith. Relatedly Article 546 provides that a builder in CAGUIOA, J:
good faith is entitled to full reimbursement for all the necessary and useful expenses
incurred. In this case, however, the option of selling the land to the builder in good The Case
faith is no longer viable in light of the ruling in the interpleader case. Hence, there is
only one thing left for [BDC] to do: indemnify Diaz for the improvements introduced This is a Petition for Review on Certiorari (Petition) filed under Rule 45 of the Rules
on the property. of Court assailing the February 3, 2016 Decision (assailed Decision) and July 5, 2016
Resolution (assailed Resolution) rendered by the Court of Appeals (CA), Eleventh
Nevertheless, because the law treats both parties as if they acted in good faith, the CA Division in CA-G.R. CV No. 102802.
committed reversible error in awarding moral and exemplary damages, there being no
basis therefor. We find it proper to delete the award of P100,000.00 as moral The assailed Decision and Resolution affirmed, with modification, the February 24,
damages, P50,000.00 as exemplary damages, and P25,000.00 as attorney’s fees. 2014 Decision and May 19, 2014 Order issued by the Regional Trial Court (RTC) of
Pasig City, Branch 166, in Civil Case No. 71670.
 BPI Check] was dishonored by BPI for being drawn against a closed account. Tan
The RTC granted the Complaint for Sum of Money filed by Union Bank of the refused to return the said amount. Union Bank then debited the available balance
Philippines (Union Bank) against Rodriguez Ong Tan (Tan), the registered owner and reflected in [Tan's] account amounting to P34,700.6013 and thereafter instituted [a
operator of Yon Mitori International Industries (Yon Mitori). Complaint for Sum of Money (Complaint)] before the RTC, for the recovery of [the
remaining balance amounting to] P385,299.40 plus consequential damages.
The Facts
RTC Proceedings
The CA summarized the facts as follows:
In its Complaint, Union Bank alleged that the value of the BPI Check had been
[Tan], doing business under the name and style of [Yon Mitori], is a depositor, inadvertently credited to Tan's account due to a technical error in its system.
maintaining Current Account No. 027-03-000181-8, [with] the Commonwealth,
Quezon City branch of [Union Bank]. For his part, Tan alleged that the BPI Check had been given to him for value in the
course of business. Tan claimed that he should not be faulted for withdrawing the
On November 12, 2007, Tan deposited in said Union Bank account, the amount of value of said check from his account since Union Bank made the corresponding funds
P420,000.00 through Bank of the Philippine Islands (BPI) Check No. 0180724 [(BPI available by updating his account to reflect his new balance. After ascertaining that
Check)]. x x x the value of the BPI Check had been credited, Tan withdrew P480,000.00 from his
account to pay one of his suppliers.
[The BPI Check was drawn against the account of Angli Lumber & Hardware, Inc.
(Angli Lumber), one of Tan's alleged clients.] Tan further argued that Union Bank wrongfully and unlawfully deducted the amount
of P34,700.60 from his account.
[The BPI Check was entered in Tan's bank record thereby increasing his balance to
P513,700.60 from his previous deposit of P93,700.60.9 In the morning of November On February 24, 2014, the RTC ruled in favor of Union Bank. The dispositive portion
14, 2007, Tan withdrew from the said account the amount of P480,000.00. Later that of the RTC Decision reads:
day, the BPI Check was returned to Union Bank as the account against which it was
drawn had been closed. It was then that Union Bank discovered that Tan's account WHEREFORE, premises considered, judgment is hereby rendered in favor of [Union
had been mistakenly credited. Thus, the branch manager of Union Bank's Bank] and against [Yon Mitori and Tan] by ordering the latter:
Commonwealth, Quezon City branch immediately called Tan to recover the funds
mistakenly released. However, Tan refused to return the funds, claiming that the BPI 1. To pay [Union Bank] the amount of P385,299.40 representing the withdrawal
Check proceeded from a valid transaction between Angli Lumber and Yon Mitori. mistakenly given to x x x Tan;

During the course of its investigation, Union Bank discovered that Tan previously 2. To pay [Union Bank] 12% per annum legal interest computed from the time
deposited five BPI checks drawn by Angli Lumber against the same BPI account, and judicial demand was made on June 13, 2008 until the same is fully paid;
that these five checks were all previously dishonored.
3. To pay [Union Bank] the amount of P100,000.00 as attorney's fees; and
Thereafter, on November 20, 2007, Union Bank [through the bank manager of its
Commonwealth branch, sent Tan a letter demanding reimbursement of the amount of 4. To pay the duly receipted cost of suit in the amount of P14,954.20.
P420,000.00, by reason of the fact that [the] "(f)unds against said deposit was
inadvertently allowed due to technical error on the system prior to actual return of SO ORDERED.
your check deposit which was not yet clear on withdrawal date," it appearing that [the
The RTC found all the requisites for the application of solutio indebiti under Article Foremost, the CA stressed that the fact of dishonor of the BPI Check for the reason
2154 of the Civil Code present. It held that since Union Bank mistakenly released the "Account Closed" is undisputed. On this basis, the CA affirmed the RTC's findings
amount of P480,000.00 in favor of Tan without being obligated to do so, Tan must be and held that Tan would be unjustly enriched at Union Bank's expense if he were
ordered to return said amount to preclude unjust enrichment at Union Bank's expense. permitted to derive benefit from the funds erroneously credited to his account. As
well, the CA upheld the application of legal compensation in the case.
Further, the RTC ruled that under Article 1980 of the Civil Code, "fixed, savings, and
current deposits of money in banks and similar institutions shall be governed by the Nevertheless, the CA found the award of attorney's fees and cost of suit in favor of
provisions concerning [simple] loan." By reason of the erroneous payment made in Union Bank improper. Since the banking industry is impressed with public interest,
Tan's favor, Tan and Union Bank became mutual debtors and creditors of each other. all bank personnel are burdened with a high level of responsibility insofar as care and
This gave rise to Union Bank's right to set-off the erroneous payment made against diligence in the custody and management of funds are concerned. Here, the evidence
Tan's remaining deposit, consistent with the principle of legal compensation under the shows that the proximate cause of the unwarranted crediting of the value of the BPI
Civil Code. Check was Union Bank's technical error. Thus, while Union Bank was compelled to
litigate to protect its rights, such fact alone does not justify an award of attorney's fees
Finally, the RTC held that Union Bank should be awarded attorney's fees and cost of and cost of suit there being no showing that Tan acted in bad faith in refusing to
suit since it was compelled to litigate due to Tan's unjustified refusal to return the reimburse the amount so credited.
funds mistakenly released to him.
Finally, the CA modified the legal interest rate applied on the awarded sum from 12%
Aggrieved, Tan filed a motion for reconsideration which the RTC denied in its Order to 6% per annum, in accordance with the Court's ruling in Nacar v. Gallery Frames.
dated May 19, 2014. The RTC held that "[although [Union Bank may have been]
negligent when it paid to [Tan] the face value of the check as alleged by [Tan]," Tan Subsequently, Tan filed a Motion for Reconsideration, still with Yon Mitori as co-
is still liable to return the funds mistakenly released to him since Union Bank was appellant. Tan argued that the uniform findings of the RTC and CA with respect to
under no obligation to release these funds in his favor. Union Bank's negligence serves as sufficient basis to hold the latter solely liable for
its loss. Tan also averred that the principle of solutio indebiti applies only in cases
CA Proceedings where the claimant unduly delivers something because of mistake, and not when such
delivery results from the claimant's negligence, as in this case.
Tan filed an appeal via Rule 41 and named Yon Mitori as co-appellant. Therein, Tan
maintained that the proximate cause of Union Bank's loss is its own gross negligence. On July 5, 2016, the CA issued the assailed Resolution denying said Motion for
Reconsideration for lack of merit. Tan received a copy of the assailed Resolution on
Following an exchange of pleadings, the CA issued the assailed Decision, the July 11, 2016.
dispositive portion of which reads:
Subsequently, Tan's counsel filed a "Motion for Additional Time to File Appeal"
WHEREFORE, in light of all the foregoing, the [D]ecision dated February 24, 2014 (Motion for Time) before the Court, praying for an additional period of thirty (30)
of Branch 166 of the [RTC] of Pasig City in Civil Case No. 71670 is hereby days from July 26, 2016, or until August 25, 2016 to file a petition for review.
AFFIRMED with MODIFICATION in that the award of attorney's fees and cost of
suit in favor of [Union Bank] are hereby deleted, and the rate of legal interest On August 25, 2016, Tan's counsel filed this Petition. Notably, the Petition names
imposed on the awarded sum, reduced to six percent (6%) per annum. Yon Mitori as sole petitioner even as it describes Yon Mitori as "a single
proprietorship duly registered under Philippine law, owned and operated by [Tan]."
SO ORDERED.
On November 9, 2016, the Court issued a Resolution granting the Motion for Time
and directing Union Bank to file its comment on the Petition within ten (10) days In turn, Section 1, Rule 3 of the 1997 Rules of Court provides that only natural and
from notice. juridical persons or entities authorized by law may be parties in a civil action. A
single proprietorship is not considered a separate juridical person under the Civil
In compliance with the Court's Resolution, Union Bank filed its Comment on April Code.
17, 2017, to which a Reply had been filed.
The Petition was filed solely in the name of Yon Mitori. As a single proprietorship,
The Petition maintains that the proximate cause of Union Bank's loss is its own gross Yon Mitori has no juridical personality separate and distinct from its owner and
negligence. Thus, it is barred from recovering damages under Article 2179 of the operator Tan. Accordingly, the Petition should have been filed in Tan's name, the
Civil Code. latter being the real party in interest who possesses the legal standing to file this
Petition.
In addition, the Petition reiterates that Union Bank's gross negligence also precludes
the application of solutio indebiti in this case as there can be no reimbursement under Nevertheless, the Court permits the substitution of Tan as petitioner herein in the
this principle if payment is made as a result of one's negligence. The Petition relies on interest of justice, pursuant to Section 4, Rule 10 of the 1997 Rules of Court:
the Court's ruling in Philippine National Bank v. Cheah Chee Chong47 (PNB v.
Cheah) where the Court held that under the principle of solutio indebiti, no recovery SEC. 4. Formal Amendments. — A defect in the designation of the parties and other
is due "if the mistake done is one of gross negligence." clearly clerical or typographical errors may be summarily corrected by the court at
any stage of the action, at its initiative or on motion, provided no prejudice is caused
Finally, the Petition contends that as collecting agent, Union Bank is responsible for thereby to the adverse party. (Emphasis supplied)
losses arising from its own negligence pursuant to Article 1909 of the Civil Code.
Thus, the Petition argues that Article 1909 should be applied to hold Union Bank In Juasing Hardware v. Mendoza (Juasing), the Court held that the filing of a civil
solely liable for its own loss, based on the Court's ruling in Metropolitan Bank and action in the name of a single proprietorship is merely a formal, and not a substantial
Trust Company v. Court of Appeals (Metrobank v. CA). defect. Substitution of the party in such cases would not constitute a change in the
identity of the parties, and would not cause any prejudice on the adverse party, thus:
Issue
Contrary to the ruling of respondent Judge, the defect of the complaint in the instant
The sole issue for the Court's resolution is whether the CA erred when it affirmed the case is merely formal, not substantial. Substitution of the party plaintiff would not
RTC Decision directing Tan to return the value of the BPI Check with legal interest. constitute a change in the identity of the parties. No unfairness or surprise to private
respondent Dolla, defendant in the court a quo, would result by allowing the
The Court's Ruling amendment, the purpose of which is merely to conform to procedural rules or to
correct a technical error.
The Petition is denied for lack of merit.
In Juasing, the Court ruled that the lower court erred in not allowing the amendment
Yon Mitori has no separate juridical personality. of the complaint filed therein to correct the designation of the party plaintiff, for
while the complaint named the sole proprietorship "Juasing Hardware" as plaintiff,
Before delving into the substantive issues, the Court must emphasize that as a general the allegations therein show that said complaint was actually brought by its owner.
rule, every civil action must be prosecuted, or defended in the name of the real party
in interest, that is, the party who stands to be benefited or injured by the judgment in This Petition warrants the same course of action. As in Juasing, no prejudice will
the suit, or the party entitled to the avails of the suit. result from Yon Mitori's substitution in this case. Tan has been consistently named as
owner and operator of Yon Mitori throughout the proceedings below. Moreover, the There is unjust enrichment when a person unjustly retains a benefit to the loss of
fact that this Petition was filed in furtherance of Tan's interests is apparent from the another, or when a person retains money or property of another against the
allegations in the pleadings filed before the Court and accordingly furnished to Union fundamental principles of justice, equity, and good conscience.
Bank.
For the principle to apply, the following requisites must concur: (i) a person is
Having settled the foregoing procedural matter, the Court now proceeds to resolve the unjustly benefited; and (ii) such benefit is derived at the expense of or with damages
substantive issues. to another. Expounding on these requisites, the Court, in University of the Philippines
v. Philab Industries, Inc.,61 held:
Tan is bound to return the proceeds of the dishonored BPI Check based on the
principle of unjust enrichment. Unjust enrichment claims do not lie simply because one party benefits from the
efforts or obligations of others, but instead it must be shown that a party was unjustly
Jurisprudence defines a collecting bank as "any bank handling an item for collection enriched in the sense that the term unjustly could mean illegally or unlawfully.
except the bank on which the check is drawn." Upon receipt of a check for deposit,
the collecting bank binds itself to "credit the amount in [the depositor's] account or Moreover, to substantiate a claim for unjust enrichment, the claimant must
infuse value thereon only after the drawee bank shall have paid the amount of the unequivocally prove that another party knowingly received something of value to
check or [after] the check [is] cleared for deposit." which he was not entitled and that the state of affairs are such that it would be unjust
for the person to keep the benefit. Unjust enrichment is a term used to depict result or
In this case, Tan deposited the BPI Check in his account with Union Bank for effect of failure to make remuneration of or for property or benefits received under
collection. Clearly, Union Bank stands as the collecting bank in this case. By circumstances that give rise to legal or equitable obligation to account for them; to be
receiving the BPI Check from Tan, Union Bank obliged itself, as collecting bank, to entitled to remuneration, one must confer benefit by mistake, fraud, coercion, or
credit Tan's account only after BPI, as drawee, shall have paid the amount of the said request. Unjust enrichment is not itself a theory of reconvey. Rather, it is a
check or after the check is cleared for deposit. prerequisite for the enforcement of the doctrine of restitution. (Emphasis and
underscoring supplied; italics omitted)
As correctly observed by the CA, the dishonor of the BPI Check is not disputed.
Evidently, Union Bank was under no obligation to effect payment in favor of Tan The requisites for the application of the principle of unjust enrichment are clearly
precisely because the BPI Check which Tan deposited for collection had been present in this case. Here, it was unequivocally established that Tan withdrew and
dishonored. Allowing Tan to retain the proceeds of the dishonored BPI Check despite utilized the proceeds of the BPI Check fully knowing that he was not entitled
not being entitled thereto would therefore permit unjust enrichment at Union Bank's thereto.
expense.
To note, Tan's transaction records show that prior to the deposit of the BPI Check
The principle of unjust enrichment is codified under Article 22 of the Civil Code. It subject of the present case, Tan had deposited five other checks drawn against the
states: same account. During Tan's cross-examination before the RTC, Tan admitted that
Union Bank notified him that all five checks he had previously deposited had all been
ART. 22. Every person who through an act of performance by another, or any other dishonored for the reason "Account Closed" — which notification was made before
means, acquires or comes into possession of something at the expense of the latter he deposited the BPI Check subject of the present case, thus:
without just or legal ground, shall return the same to him.
"Q: Mr. Witness, it appears that you had previously deposited BPI Checks also issued
or also made by [Angli Lumber]. I think these x x x BPI Checks were also deposited
in your bank, Union Bank, is that correct Mr. Witness?
A: That is correct, sir. A: My signature, sir.

Q: In fact on five (5) occasions you had deposited BPI Checks [i]ssued by [Angli Q: This return check advise refers to Check No. 0206927 and also Check No.
Lumber] drawn against its BPI [a]ccount and you deposited the same to your bank, x 0206926 and Check No. 0180723. The drawee bank of these checks are all BPI San
x x Union Bank in this case, is that correct, Mr. Witness? Fernando Highway and the date[s] of the deposits are as follows: November 5, 2007
for Check No. 0206926 and November 3, 2007 for Check No. 0180723 all of these
A: Yes, sir. return check advise, Mr. Witness [state] that the reason for the return is account
closed, do you confirm that, Mr. Witness?
Q: In those five (5) occasions, Mr. witness, do you confirm that all of these checks
were returned to you because the account of [Angli Lumber] was closed, is that A: Yes, sir.
correct?
xxxx
A: Yes, sir. x x x
[Q]: So as early as October, Mr. Witness, you have been given [c]hecks by this [Angli
Q: Mr. Witness, I have here a return Check Advise dated November 5, 2007. This is Lumber] and you have been depositing the same in your bank account and all of these
before the subject transaction. Can you please tell this [court] if you recognize this checks were returned to you because you were informed that the account had been
written Check Advise? closed, is that correct?

A: Yes, sir. xxxx

Q: You also pointed to a signature. Are you confirming that, that is your signature, Q: So these checks were all returned to you for being Account closed?
Mr. Witness?
A: Yes, sir." x x x64 (Emphasis and underscoring supplied)
A: Yes, sir.
Tan's testimony confirms that he was fully aware that Angli Lumber's account with
Q: Also, this refers to Check No. 0206925, BPI San Fernando Highway, drawee bank. BPI had been closed. So he could not have expected that the BPI Check in question
It was deposited on October 30, 2007? would be honored. Stated differently, he was cognizant of the BPI Check's impending
dishonor at the time he withdrew its proceeds from his Union Bank account. That Tan
A: Yes, sir. withdrew the proceeds of the BPI Check soon after discovering that the
corresponding funds had been credited to his account despite his knowledge that the
Q: Mr. Witness, I also have here a return check advise dated November 7, 2007, can account from which the BPI Check was issued had been closed for some time smacks
you please tell the court if you recognize this document? of bad faith if not fraud. Tan's refusal to return the funds despite Union Bank's
repeated demands is reprehensible.
A: Yes, sir.
On this score, reference to the Court's ruling in Equitable Banking Corporation v.
xxxx Special Steel Products, Inc.65 (Equitable Banking) is proper. In said case, a certain
Jose Isidoro Uy (Uy), purchasing officer of International Copra Export Corporation
Q: Whose signature is that, Mr. Witness? (Interco), presented three crossed checks to Equitable Banking Corporation
(Equitable) for collection. These crossed checks were made payable to the order of Nevertheless, Tan withdrew the proceeds of the BPI Check with full and established
Special Steel Products, Inc. (SSPI), Interco's supplier. knowledge that the account against which it was drawn had been closed. As in
Equitable Banking, Tan, the depositor herein, was unjustly benefited by reason of the
The crossed checks bore the notation "account payee only". Despite this notation, erroneous credit made in his favor. Such benefit, in turn, was derived at the expense
Equitable deposited the proceeds of the three checks to Uy's personal account upon of Union Bank as the collecting bank.
the latter's instructions. Equitable claimed that it did so believing that Uy was acting
upon Interco's instructions. Due to the incident, SSPI and its President Augusto Pardo Thus, based on the principle of unjust enrichment, Tan is bound to return the proceeds
(Pardo) filed an action for damages against Equitable and Uy. of the BPI Check which he had no right to receive.

The Court adjudged Equitable and Uy jointly and severally liable to pay SSPI and PNB v. Cheah is inapplicable.
Pardo actual, moral, and exemplary damages, as well as costs of suit. Nevertheless, to
preclude unjust enrichment, the Court directed Uy to reimburse Equitable whatever Tan argues that Union Bank should not be allowed to recover the amount erroneously
amount it may be required to pay SSPI and Pardo, thus: deposited in his account, since said payment was made not because of any mistake of
fact or law, but because of Union Bank's own gross negligence. According to Tan,
Equitable then insists on the allowance of [its] cross-claim against Uy. The bank such negligence on the part of Union Bank precludes recovery, pursuant to the
argues that it was Uy who was enriched by the entire scheme and should reimburse Court's ruling in PNB v. Cheah.
Equitable for whatever amounts the Court might order it to pay in damages to SSPI.
The Court disagrees.
Equitable is correct. There is unjust enrichment when (1) a person is unjustly
benefited, and (2) such benefit is derived at the expense of or with damages to In PNB v. Cheah, petitioner Ofelia Cheah (Ofelia) agreed to accommodate Filipina
another. In the instant case, the fraudulent scheme concocted by Uy allowed him to Tuazon's (Filipina) request to have the latter's Bank of America (BOA) Check cleared
improperly receive the proceeds of the three crossed checks and enjoy the profits and encashed for a service fee of 2.5%. Filipina was a mere acquaintance introduced
from these proceeds during the entire time that it was withheld from SSPI. Equitable, to Ofelia by her friend Adelina Guarin (Adelina). Filipina enlisted Ofelia's assistance
through its gross negligence and mislaid trust on Uy, became an unwitting instrument since she did not have a dollar account necessary to encash the BOA Check which
in Uy's scheme. Equitable's fault renders it solidarity liable with Uy, insofar as was drawn for the amount of $300,000.00.
respondents are concerned. Nevertheless, as between Equitable and Uy, Equitable
should be allowed to recover from Uy whatever amounts Equitable may be made to On November 4, 1992, Ofelia deposited the BOA Check to her joint PNB dollar
pay under the judgment. It is clear that Equitable did not profit in Uy's scheme. savings account (DSA) with her Malaysian husband Cheah Chee Chong. Five days
Disallowing Equitable's cross-claim against Uy is tantamount to allowing Uy to later, PNB received a credit advice from Philadelphia National Bank in the United
unjustly enrich himself at the expense of Equitable. For this reason, the Court allows States, stating that the proceeds of the BOA Check had been temporarily credited to
Equitable's cross-claim against Uy. (Emphasis supplied) PNB's account as of November 6, 1992.

The circumstances which impelled the Court to apply the principle of unjust On November 16, 1992, PNB Division Chief Alberto Garin called Ofelia to inform
enrichment in Equitable Banking are present in this case. her that the BOA Check had been cleared and that her joint DSA with Cheah Chee
Chong had been credited the amount of $299,248.37 (representing the face value of
As stated, Union Bank's obligation to credit Tan's account is contingent upon actual the BOA Check sans bank charges). Hence, the proceeds of the BOA Check were
receipt of the value of the BPI Check or notice of its clearance. Due to the dishonor of withdrawn and delivered to Filipina.
the BPI Check, Union Bank's obligation to credit Tan's account with its proceeds did
not attach. Conversely, Tan's right to receive the proceeds of said check did not arise.
On November 20, 1992, PNB received notice that the BOA Check bounced for being
drawn against insufficient funds. PNB demanded that Ofelia and Cheah Chee Chong This Court already held that the payment of the amounts of checks without previously
return the funds withdrawn. In turn, Ofelia attempted to retrieve the funds from clearing them with the drawee bank especially so where the drawee bank is a foreign
Filipina, but Filipina claimed that the funds had already been distributed to several bank and the amounts involved were large is contrary to normal or ordinary banking
other individuals. Thus, Ofelia and Cheah Chee Chong (Spouses Cheah) requested practice. Also, in Associated Bank v. Tan, wherein the bank allowed the withdrawal
the assistance of the National Bureau of Investigation (NBI) to apprehend the of the value of a check prior to its clearing, we said that "[b]efore the check shall have
beneficiaries of the BOA Check. Meanwhile, Spouses Cheah and PNB negotiated the been cleared for deposit, the collecting bank can only 'assume' at its own risk x x x
terms of reimbursement pending NBI's investigation. that the check would be cleared and paid out." The delay in the receipt by PNB
Buendia Branch of the November 13, 1992 SWIFT message notifying it of the
After negotiations between Spouses Cheah and PNB fell through, PNB filed a dishonor of the subject check is of no moment, because had PNB Buendia Branch
complaint for sum of money before the RTC. As their main defense, Spouses Cheah waited for the expiration of the clearing period and had never released during that
claimed that the proximate cause of PNB's injury was its own negligence in paying time the proceeds of the check, it would have already been duly notified of its
the BOA Check without waiting for the expiration of its own 15-day clearing period. dishonor. Clearly, PNB's disregard of its preventive and protective measure against
the possibility of being victimized by bad checks had brought upon itself the injury of
The RTC ruled in favor of PNB. However, the CA reversed on appeal, finding that losing a significant amount of money.
PNB exhibited negligence in allowing the premature withdrawal of the proceeds of
the BOA Check. However, the CA also found Ofelia guilty of contributory It bears stressing that "the diligence required of banks is more than that of a Roman
negligence. Thus, the CA ruled that Spouses Cheah and PNB should be made equally pater familias or a good father of a family. The highest degree of diligence is
responsible for the resulting loss. expected." PNB miserably failed to do its duty of exercising extraordinary diligence
and reasonable business prudence. The disregard of its own banking policy amounts
Unsatisfied, the parties filed their respective petitions for review before the Court. to gross negligence, which the law defines as "negligence characterized by the want
Affirming the CA's Decision, the Court ruled: of even slight care, acting or omitting to act in a situation where there is duty to act,
not inadvertently but wilfully and intentionally with a conscious indifference to
Here, while PNB highlights Ofelia's fault in accommodating a stranger's check and consequences in so far as other persons may be affected." x x x
depositing it to the bank, it remains mum in its release of the proceeds thereof without
exhausting the 15-day clearing period, an act which contravened established banking Incidentally, PNB obliges the [S]pouses Cheah to return the withdrawn money under
rules and practice. the principle of solutio indebiti, which is laid down in Article 2154 of the Civil
Code[.]
It is worthy of notice that the 15-day clearing period alluded to is construed as 15
banking days. As declared by Josephine Estella, the Administrative Service Officer xxxx
who was the bank's Remittance Examiner, what was unusual in the processing of the
check was that the "lapse of 15 banking days was not observed." Even PNB's "[T]he indispensable requisites of the juridical relation known as solutio indebiti, are,
agreement with Philadelphia National Bank regarding the rules on the collection of (a) that he who paid was not under obligation to do so; and (b) that the payment was
the proceeds of US dollar checks refers to "business/banking days." Ofelia deposited made by reason of an essential mistake of fact.
the subject check on November 4, 1992. Hence, the 15th banking day from the date of
said deposit should fall on November 25, 1992. However, what happened was that In the case at bench, PNB cannot recover the proceeds of the check under the
PNB Buendia Branch, upon calling up Ofelia that the check had been cleared, principle it invokes. In the first place, the gross negligence of PNB, as earlier
allowed the proceeds thereof to be withdrawn on November 17 and 18, 1992, a week discussed, can never be equated with a mere mistake of fact, which must be
before the lapse of the standard 15-day clearing period.
something excusable and which requires the exercise of prudence. No recovery is due A juxtaposition of the circumstances attendant in PNB v. Cheah and the present case
if the mistake done is one of gross negligence. shows that Tan's reliance on PNB v. Cheah does not support his cause. In fact,
reliance on PNB v. Cheah actually weakens Tan's claim.
The [S]pouses Cheah are guilty of contributory negligence and are bound to share the
loss with the bank. It is well established that whoever alleges a fact has the burden of proving it because
mere allegation is not evidence.68 The records show that while Tan harped on Union
"Contributory negligence is conduct on the part of the injured party, contributing as a Bank's alleged gross negligence, he failed to cite the specific provision of law,
legal cause to the harm he has suffered, which falls below the standard to which he is banking regulation, or internal rule which had been violated by Union Bank. What is
required to conform for his own protection." clear from the evidence on record is that due to a technical error in Union Bank's
system, the funds corresponding to the value of the BPI Check were credited to Tan's
The CA found Ofelia's credulousness blameworthy. We agree. Indeed, Ofelia failed account before actual return and clearance. Because of this error, said funds were
to observe caution in giving her full trust in accommodating a complete stranger and inadvertently made available for Tan's withdrawal upon Union Bank's mistaken belief
this led her and her husband to be swindled. Considering that Filipina was not that the check had already been cleared. Upon notice of the BPI Check's dishonor,
personally known to her and the amount of the foreign check to be encashed was Union Bank's officer immediately notified Tan of such fact.69 However, despite
$300,000.00, a higher degree of care is expected of Ofelia which she, however, failed repeated demands, Tan refused to return the amount he had withdrawn insisting that
to exercise under the circumstances. Another circumstance which should have goaded the BPI Check was given to him for value and in the course of business.70
Ofelia to be more circumspect in her dealings was when a bank officer called her up
to inform that the [BOA C]heck has already been cleared way earlier than the 15-day Clearly, Tan failed to substantiate his imputation of gross negligence. While Union
clearing period. The fact that the check was cleared after only eight banking days Bank concedes that a technical error in its own system allowed Tan to withdraw the
from the time it was deposited or contrary to what [PNB Division Chief Alfredo proceeds of the BPI Check before clearance, this error cannot be likened to the blatant
Garin] told her that clearing takes 15 days should have already put Ofelia on guard. violation of internal procedure committed by PNB's Division Chief in PNB v. Cheah.
She should have first verified the regularity of such hasty clearance considering that if
something goes wrong with the transaction, it is she and her husband who would be More importantly, in PNB v. Cheah, respondent Ofelia did not benefit from the
put at risk and not the accommodated party. However, Ofelia chose to ignore the proceeds of the dishonored BOA Check. While Ofelia deposited said check to
same and instead actively participated in immediately withdrawing the proceeds of facilitate encashment, she subsequently delivered the proceeds to Filipina. In this
the check. Thus, we are one with the CA in ruling that Ofelia's prior consultation with case, it is established that the funds in dispute had been withdrawn by Tan himself. In
PNB officers is not enough to totally absolve her of any liability. In the first place, fact, Tan acknowledged that he used said funds to pay one of his suppliers.71
she should have shunned any participation in that palpably shady transaction.67 Allowing Tan to benefit from the erroneous payment would undoubtedly permit
(Emphasis supplied; citations omitted) unjust enrichment at Union Bank's expense particularly in light of circumstances
which indicate that Tan withdrew in bad faith the mistakenly released funds.
In PNB v. Cheah, the Court ruled that PNB was guilty of gross negligence as its own
bank officer permitted Ofelia to prematurely withdraw the proceeds of the BOA Article 1909 does not preclude recovery on the part of Union Bank.
Check by advising her of the funds' availability before the expiration of the 15-day
clearing period mandated by its own internal rules (i.e., PNB General Circular No. In an attempt to evade liability, Tan also argues that, as his collecting agent, Union
52-101/88). Despite PNB's gross negligence, the Court nevertheless tempered PNB's Bank should be held solely responsible for losses arising from its own negligence,
liability due to Ofelia's contributory negligence. Thus, in PNB v. Cheah, the parties pursuant to Article 1909 of the Civil Code. Tan invokes the Court's ruling in
were made to suffer the resulting loss equally. Metrobank v. CA as basis.

Tan's reliance on Metrobank v. CA is misplaced.

 It was, in fact, to secure the clearance of the treasury warrants that Golden Savings
In said case, a certain Eduardo Gomez (Eduardo) deposited 38 treasury warrants with deposited them to its account with Metrobank. Golden Savings had no clearing
a total amount of P1,755,228.37 to his account with Golden Savings and Loan facilities of its own. It relied on Metrobank to determine the validity of the warrants
Association (Golden Savings). Since Golden Savings did not have its own clearing through its own services. The proceeds of the warrants were withheld from [Eduardo]
facilities, its cashier Gloria Castillo endorsed said warrants and deposited them in until Metrobank allowed Golden Savings itself to withdraw them from its own
Golden Savings' account with petitioner Metropolitan Bank and Trust Company deposit. It was only when Metrobank gave the go-signal that [Eduardo] was finally
(Metrobank). allowed by Golden Savings to withdraw them from his own account.73 (Emphasis
supplied)
Gloria went to Metrobank several times to confirm whether the warrants had been
cleared. While Gloria was initially told to wait, Metrobank eventually allowed her to By invoking Article 1909 as applied in Metrobank v. CA, Tan appears to assert that
withdraw the proceeds of the warrants on behalf of Golden Savings due to he, as principal-depositor, suffered losses because of the technical error in Union
"exasperation" over her repeated inquiries, and as a form of accommodation to Bank's system. This assertion is clearly false.
Golden Savings as a valued Client. Thereafter, Eduardo was allowed to withdraw
from his deposit account with Golden Savings. As stated, Tan had no right to receive the proceeds of the BPI Check. Evidently, Tan
did not suffer any loss as a result of Union Bank's technical error. On the contrary,
Five days after Eduardo's last withdrawal, Metrobank informed Golden Savings that Tan unduly gained from the technical error, as it allowed him to withdraw and utilize
32 out of the 38 treasury warrants were dishonored by the Bureau of Treasury. Thus, funds which he had no right to receive.
Metrobank demanded that Golden Savings refund the proceeds previously withdrawn
to make up for the deficit in its account. Golden Savings rejected the demand, causing The fact that Tan received the BPI Check for value in the ordinary course of business
Metrobank to file a complaint for collection of sum of money with the RTC. does not negate his obligation to return the funds erroneously credited in his favor.
Tan's remedy, if any, lies not against Union Bank, but against the drawer of the BPI
The RTC ruled in favor of Golden Savings. The CA affirmed on appeal. Aggrieved, Check Angli Lumber. All told, Tan's obligation to return the erroneously credited
Metrobank filed a petition for review before the Court, alleging, among others, that funds to Union Bank stands.
"[it] cannot be held liable for its failure to collect on the warrants" since it merely
acted as a collecting agent.72 Amount due

In its Decision, the Court applied Article 1909 to hold Metrobank liable for the losses The records show that Tan had a balance amounting to P93,700.60 before the value of
suffered by Golden Savings as a result of Metrobank's negligence.ℒαwρhi ৷ The the BPI Check was erroneously credited to his Union Bank account.74 Due to Union
Court held: Bank's system error, Tan's account was credited with the amount of P420,000.00,
thereby increasing his balance to P513,700.60. Subsequently, Tan's account was
From the above undisputed facts, it would appear to the Court that Metrobank was credited an additional amount of P1,000.00 as a result of a separate encashment.
indeed negligent in giving Golden Savings the impression that the treasury warrants
had been cleared and that, consequently, it was safe to allow [Eduardo] to withdraw Later still, Tan withdrew the amount of P480,000.00. This left Tan's account with the
the proceeds thereof from his account with it. Without such assurance, Golden balance of P34,700.60. To illustrate:
Savings would not have allowed the withdrawals; with such assurance, there was no
reason not to allow the withdrawal. Indeed, Golden Savings might even have incurred Account balance prior to deposit P 93,700.60
liability for its refusal to return the money that to all appearances belonged to the Amount credited due to system error 420,000.00
depositor, who could therefore withdraw it any time and for any reason he saw fit. Separate encashment 1,000.00
Account balance prior to withdrawal 514,700.60
Amount withdrawn (480,000.00)
Account balance after withdrawal P 34,700.60
Since Tan refused to return the mistakenly credited amount of P420,000.00, Union
Bank applied Tan's remaining balance of P34,700.60 to set off his debt before it filed ARTICLE 26
its Complaint before the RTC.

Thus, the sum due to Union Bank is P385,299.40, as stated in the RTC Decision. This [G.R. NO. 180832 : July 23, 2008]
awarded sum, not being a loan or forbearance of money, is subject to 6% interest per
annum. In turn, such interest should be computed from the time when the amount due
had been established with reasonable certainty, which, in this case, was the date of JEROME CASTRO, Petitioner, v. PEOPLE OF THE
Union Bank's extrajudicial demand on November 20, 2007. PHILIPPINES, Respondent.
The deletion of damages, attorney's fees and costs of suit was not assailed.
RESOLUTION
Finally, the Court shall not delve into the issue of damages, attorney's fees, and cost
of suit in this Decision considering that Union Bank no longer assailed the deletion of CORONA, J.:
these awards before this Court.
This Petition for Review on Certiorari emanated from the complaint for grave oral
WHEREFORE, the Petition is DENIED. The Decision dated February 3, 2016 and defamation2 filed by Albert P. Tan against petitioner Jerome Castro.
Resolution dated July 5, 2016 rendered by the Court of Appeals, Eleventh Division in
CA-G.R. CV No. 102802 are AFFIRMED. The facts follow.
Petitioner Rodriguez Ong Tan, doing business under the name and style Yon Mitori On November 11, 2002, Reedley International School (RIS) dismissed Tan's son,
International Industries, is ORDERED to pay respondent Union Bank of the Justin Albert (then a Grade 12 student), for violating the terms of his disciplinary
Philippines the amount of P385,299.40 with legal interest at the rate of 6% per probation. Upon Tan's request, RIS reconsidered its decision but imposed "non-
annum, computed from the time of extrajudicial demand on November 20, 2007 until appealable" conditions such as excluding Justin Albert from participating in the
full payment. graduation ceremonies.
SO ORDERED. Aggrieved, Tan filed a complaint in the Department of Education (Dep-Ed) for
violation of the Manual of Regulation of Private Schools, Education Act of 1982 and
Article 19 of the Civil Code against RIS. He alleged that the dismissal of his son was
undertaken with malice, bad faith and evident premeditation. After investigation, the
Dep-Ed found that RIS' code violation point system allowed the summary imposition
of unreasonable sanctions (which had no basis in fact and in law). The system
therefore violated due process. Hence, the Dep-Ed nullified it.
Meanwhile, on November 20, 2002, the Dep-Ed ordered RIS to readmit Justin Albert
without any condition. Thus, he was able to graduate from RIS and participate in the The prosecution essentially tried to establish that petitioner depicted Tan as a
commencement ceremonies held on March 30, 2003. "dangerous person." Ching testified that petitioner warned her that talking to Tan was
dangerous. Tan, on the other hand, testified that petitioner's statement shocked him as
After the graduation ceremonies, Tan met Bernice C. Ching, a fellow parent at RIS. it portrayed him as "someone capable of committing undesirable acts." He added that
In the course of their conversation, Tan intimated that he was contemplating a suit petitioner probably took offense because of the complaint he filed against RIS in the
against the officers of RIS in their personal capacities, including petitioner who was Dep-Ed.
the assistant headmaster.
For his defense, petitioner denied harboring ill-feelings against Tan despite the latter's
Ching telephoned petitioner sometime the first week of April and told him that Tan complaint against RIS in the Dep-Ed. Although he admitted conversing with Ching
was planning to sue the officers of RIS in their personal capacities. Before they hung (whom he considered as a close acquaintance) on the telephone a few days after RIS'
up, petitioner told Ching: 2003 commencement exercises, petitioner asserted that he never said or insinuated
that Tan or talking to Tan was dangerous. On cross-examination, however, he did not
Okay, you too, take care and be careful talking to [Tan], that's dangerous. categorically deny the veracity of Ching's statement.

Ching then called Tan and informed him that petitioner said "talking to him was The MeTC found that Ching's statements in her affidavit and in open court were
dangerous." consistent and that she did not have any motive to fabricate a false statement.
Petitioner, on the other hand, harbored personal resentment, aversion and ill-will
Insulted, Tan filed a complaint for grave oral defamation in the Office of the City against Tan since the Dep-Ed compelled RIS to readmit his son. Thus, the MeTC was
Prosecutor of Mandaluyong City against petitioner on August 21, 2003. convinced that petitioner told Ching talking to Tan was dangerous and that he uttered
the statement with the intention to insult Tan and tarnish his social and professional
On November 3, 2003, petitioner was charged with grave oral defamation in the reputation.
Metropolitan Trial Court (MeTC) of Mandaluyong City, Branch 607 under the
following Information: In a decision dated December 27, 2005, the MeTC found petitioner guilty beyond
reasonable doubt of grave oral defamation:
That on or about the 13th day of March, 2003 in the City of Mandaluyong,
Philippines, a place within the jurisdiction of this Honorable Court, the above-named WHEREFORE, judgment is hereby rendered finding accused, Jerome Castro
[petitioner], with deliberate intent of bringing ATTY. ALBERT P. TAN, into GUILTY beyond reasonable doubt of the crime of Grave Oral Defamation,
discredit, dishonor, disrepute and contempt, did then and there, willfully, unlawfully sentencing him therefore, in accordance to Article 358(1) of the Revised Penal Code
and feloniously speak and utter the following words to Ms. Bernice C. Ching: and applying the Indeterminate Sentence Law to suffer the penalty of imprisonment
of 1 month and 1 day of arresto mayor as minimum to 4 months and 1 day of arresto
"OK, YOU TOO, YOU TAKE CARE AND BE CAREFUL TALKING TO [TAN], mayor as maximum.
THAT'S DANGEROUS."
On appeal, the Regional Trial Court (RTC) affirmed the factual findings of the
and other words of similar import of a serious and insulting nature. MeTC. However, in view of the animosity between the parties, it found petitioner
guilty only of slight oral defamation. But because Tan filed his complaint in the
CONTRARY TO LAW. Office of the City Prosecutor of Mandaluyong City only on August 21, 2003 (or
almost five months from discovery), the RTC ruled that prescription had already set
Petitioner pleaded not guilty during arraignment. in; it therefore acquitted petitioner on that ground.
 Under this provision, double jeopardy occurs upon (1) a valid indictment (2) before a
On April 19, 2007, the Office of the Solicitor General (OSG) filed a petition for competent court (3) after arraignment (4) when a valid plea has been entered and (5)
certiorari in the Court of Appeals (CA) assailing the decision of the RTC. It when the accused was acquitted or convicted or the case was dismissed or otherwise
contended that the RTC acted with grave abuse of discretion when it downgraded terminated without the express consent of the accused. Thus, an acquittal, whether
petitioner's offense to slight oral defamation. The RTC allegedly misappreciated the ordered by the trial or appellate court, is final and unappealable on the ground of
antecedents which provoked petitioner to utter the allegedly defamatory statement double jeopardy.
against Tan.
The only exception is when the trial court acted with grave abuse of discretion or, as
The CA found that the RTC committed grave abuse of discretion when it we held in Galman v. Sandiganbayan, when there was mistrial. In such instances, the
misapprehended the totality of the circumstances and found petitioner guilty only of OSG can assail the said judgment in a petition for certiorari establishing that the State
slight oral defamation. Thus, the CA reinstated the MeTC decision. was deprived of a fair opportunity to prosecute and prove its case.

Petitioner moved for reconsideration but it was denied. Hence, this recourse. The rationale behind this exception is that a judgment rendered by the trial court with
grave abuse of discretion was issued without jurisdiction. It is, for this reason, void.
Petitioner basically contends that the CA erred in taking cognizance of the petition for Consequently, there is no double jeopardy.
certiorari inasmuch as the OSG raised errors of judgment (i.e., that the RTC
misappreciated the evidence presented by the parties) but failed to prove that the RTC In this case, the OSG merely assailed the RTC's finding on the nature of petitioner's
committed grave abuse of discretion. Thus, double jeopardy attached when the RTC statement, that is, whether it constituted grave or slight oral defamation. The OSG
acquitted him. premised its allegation of grave abuse of discretion on the RTC's "erroneous"
evaluation and assessment of the evidence presented by the parties.
We grant the petition.
What the OSG therefore questioned were errors of judgment (or those involving
No person shall be twice put in jeopardy of punishment for the same offense. This misappreciation of evidence or errors of law). However, a court, in a petition for
constitutional mandate is echoed in Section 7 of Rule 117 of the Rules of Court which certiorari, cannot review the public respondent's evaluation of the evidence and
provides: factual findings. Errors of judgment cannot be raised in a Rule 65 petition as a writ of
certiorari can only correct errors of jurisdiction (or those involving the commission of
Section 7. Former conviction or acquittal; double jeopardy. ' When an accused has grave abuse of discretion).
been convicted or acquitted or the case against him dismissed or otherwise terminated
without his express consent by a court of competent jurisdiction, upon a valid Because the OSG did not raise errors of jurisdiction, the CA erred in taking
complaint or in information or other formal charge sufficient in form and substance to cognizance of its petition and, worse, in reviewing the factual findings of the RTC.
sustain a conviction and after the accused had pleaded to the charge, the conviction or We therefore reinstate the RTC decision so as not to offend the constitutional
acquittal of the accused or the dismissal of the case shall be a bar to another prohibition against double jeopardy.
prosecution for the offense charged or for any attempt to commit the same or
frustration thereof, or for any offense which necessarily includes or is necessarily At most, petitioner could have been liable for damages under Article 26 of the Civil
included in the offense charged in the former complaint or information. Code21 :

xxx xxx xxx Article 26. Every person shall respect the dignity, personality, privacy and peace of
mind of his neighbors and other persons. The following and similar acts, though they
may not constitute a criminal offense, shall produce a cause of action for damages,
prevention and other relief:
Luzel D. Demasu-ay for respondent.
xxx xxx xxx

(3) Intriguing to cause another to be alienated from his friends;

GUTIERREZ, JR., J.:
xxx xxx xxx
This petition seeks to reverse the decision of the respondent Court of Appeals which
Petitioner is reminded that, as an educator, he is supposed to be a role model for the afirmed the decision of the Court of First Instance of Iloilo, adjudging the petitioner,
youth. As such, he should always act with justice, give everyone his due and observe who was then the President of the West Visayas College liable for damages under
honesty and good faith. Article 27 of the Civil Code of the Philippines for failure to graduate a student with
honors.
WHEREFORE, the petition is hereby GRANTED. The August 29, 2007 decision and
December 5, 2007 resolution of the Court of Appeals in CA-G.R. SP No. 98649 are The facts are not disputed.
REVERSED and SET ASIDE. The November 20, 2006 decision of the Regional
Trial Court of Mandaluyong City, Branch 212 is REINSTATED. Petitioner Jerome An organization named Student Leadership Club was formed by some students of the
Castro is ACQUITTED of slight oral defamation as defined and penalized in Article West Visayas College. They elected the late Violets Delmo as the treasurer. In that
358 of the Revised Penal Code. capacity, Delmo extended loans from the funds of the club to some of the students of
the school. "the petitioner claims that the said act of extending loans was against
No pronouncement as to costs. school rules and regulations. Thus, the petitioner, as President of the School, sent a
letter to Delmo informing her that she was being dropped from the membership of the
SO ORDERED. club and that she would not be a candidate for any award or citation from the school.

Delmo asked for a reconsideration of the decision but the petitioner denied it. Delmo,
ARTICLE 27 thus, appealed to the Office of the Director of the Bureau of Public Schools.

The Director after due investigation, rendered a decison on April 13, 1966 which
G.R. No. L-54598 April 15, 1988 provided:

JOSE B. LEDESMA, petitioner, Records of the preliminary investigation conducted by one of the legal officers of this
Office disclosed the following: That Violeta Delmo was the treasurer of the Student
vs. Leadership Club, an exclusive student organization; that pursuant to Article IX of the
HON. COURT OF APPEALS, Spouses PACIFICO of the Constitution and By-Laws of the club, it passed Resolution No. 2, authorizing
DELMO and SANCHA DELMO (as private respondents), the treasurer to disburse funds of the Club to student for financial aid and other
humanitarian purposes; that in compliance with said resolution and as treasurer of the
respondents. Club, Violeta Delmo extended loans to some officers and members of the Club upon
proper application duly approved by the majority of the members of the Executive
The Solicitor General for petitioner. Board; and that upon receiving the report from Mr. Jesse Dagoon, adviser of the
funds of the Club, that Office conducted an investigation on the matter and having organization in this school." Violeta Delmo, it is noted, has been a consistent full
been convinced of the guilt of Violets Delmo and the other officers and members of scholar of the school and she alone has maintained her scholarship. The decision in
the Club, that Office rendered the order or decision in question. In justifying that question would, therefore, set at naught all her sacrifice and frustrate her dreams of
Office's order or decision, it is contended that approval by that Office of the graduating with honors in this year's commencement exercises.
Constitution and By-Laws of the Club is necessary for its effectivity and validity and
since it was never submitted to that Office, the Club had no valid constitution and By- In view of all the foregoing, this Office believes and so holds and hereby directs that
Laws and that as a consequence, Resolution No. 2 which was passed based on the appellant Violeta. M. Delmo, and for that matter all other Club members or officers
Constitution and By-Laws- is without any force and effect and the treasurer, Violeta involved in this case, be not deprived of any award, citation or honor from the school,
Delmo, who extended loans to some officers and members of the Club pursuant if they are otherwise entitled thereto. (Rollo, pp. 28-30)
thereto are illegal (sic), hence, she and the other students involved are deemed guilty
of misappropriating the funds of the Club. On the other hand, Raclito Castaneda, On April 27, 1966, the petitioner received by mail the decision of the Director and all
Nestor Golez and Violeta Delmo, President, Secretary and Treasurer of the Club, the records of the case. On the same day, petitioner received a telegram stating the
respectively, testified that the Club had adopted its Constitution and By-Laws in a following:
meeting held last October 3, 1965, and that pursuant to Article I of said Constitution
and By-Laws, the majority of the members of the Executive Board passed Resolution "AIRMAIL RECORDS DELMO CASE MISSENT THAT OFFICE"
No. 2, which resolution became the basis for the extension on of loans to some
officers and members of the Club, that the Club honestly believed that its Constitution The Director asked for the return only of the records but the petitioner allegedly
and By-Laws has been approved by the superintendent because the adviser of the mistook the telegram as ordering him to also send the decision back. On the same
Club, Mr. Jesse Dagoon, assured the President of the Club that he will cause the day, he returned by mail all the records plus the decision of the Director to the Bureau
approval of the Constitution and By-Laws by the Superintendent; the officers of the of Public Schools.
Club have been inducted to office on October 9,1965 by the Superintendent and that
the Club had been likewise allowed to cosponsor the Education Week Celebration. The next day, the petitioner received another telegram from the Director order him to
furnish Delmo with a copy of the decision. The petitioner, in turn, sent a night letter
After a careful study of the records, this Office sustains the action taken by the to the Director informing the latter that he had sent the decision back and that he had
Superintendent in penalizing the adviser of the Club as well as the officers and not retained a copy thereof..
members thereof by dropping them from membership therein. However, this Office is
convinced that Violets M. Delmo had acted in good faith, in her capacity as Club On May 3, 1966, the day of the graduation, the petitioner received another telegram
Treasurer, in extending loans to the officers and members of the Student partnership from the Director ordering him not to deprive Delmo of any honors due her. As it was
Club. Resolution No. 2 authorizing the Club treasurer to discharge finds to students in impossible by this time to include Delmo's name in the program as one of the honor
need of financial assistance and other humanitarian purposes had been approved by students, the petitioner let her graduate as a plain student instead of being awarded the
the Club adviser, Mr. Jesse Dagoon, with the notation that approval was given in his Latin honor of Magna Cum Laude.
capacity as adviser of the Club and extension of the Superintendent's personality.
Aside from misleading the officers and members of the Club, Mr. Dagoon, had To delay the matter further, the petitioner on May 5, 1966, wrote the Director for a
unsatisfactorily explained why he failed to give the Constitution and By-Laws of the reconsideration of the latters" decision because he believed that Delmo should not be
Club to the Superintendent for approval despite his assurance to the Club president allowed to graduate with honors. The Director denied the petitioner's request.
that he would do so. With this finding of negligence on the part of the Club adviser,
not to mention laxity in the performance of his duties as such, this Office considers as On July 12, 1966, the petitioner finally instructed the Registrar of the school to enter
too severe and unwarranted that portion of the questioned order stating that Violeta into the scholastic records of Delmo the honor, "Magna Cum Laude."
Delmo "shall not be a candidate for any award or citation from this school or any
On July 30, 1966, Delmo, then a minor, was joined by her parents in flag action for copy of the Decision, Exh. "L," but instead of informing Miss Delmo about the
damages against the petitioner. During the pendency of the action, however, Delmo decision, since he said he mailed back the decision on April 28,1966, he sent a night
passed away, and thus, an Amended and Supplemental Complaint was filed by her letter on April 29,1966, to Director Bernardino, informing the latter that he had
parents as her sole and only heirs. returned the decision (Exh. "l3"), together with the record. Why a night letter when
the matter was of utmost urgency to the parties in the case, because graduation day
The trial court after hearing rendered judgment against the petitioner and in favor of was only four days ahead? An examination of the telegrams sent by the defendant
the spouses Delmo. The court said: shows that he had been sending ordinary telegram and not night letters. (Exh. "5",
Exhibit "7"). At least, if the defendant could not furnish a copy of the decision, (Exh.
Let us go to specific badges of the defendants (now petitioners) bad faith. Per "L"), to Miss Delmo, he should have told her about it or that Miss Delmo's honors
investigation of Violeta Delmo's appeal to Director Vitaliano Bernardino of the and citation in the commencement be announced or indicated. But Mr. Ledesma is
Bureau of Public Schools (Exhibit L it was the defendant who inducted the officers of one who cannot admit a mistake. Very ungentlemanly this is home out by his own
the Student Leadership Club on October 9, 1965. In fact the Club was allowed to testimony despite his knowledge that his decision to deprive Miss Delmo of honors
cosponsor the Education Week Celebration. (Exh. "L"). If the defendant he not due to her was overturned by Director Bernardino, he on his wrong belief. To quote
approve of the constitution and by-laws of the Club, why did he induct the officers the defendant,1 believed that she did not deserve those honors(Tsn Feb. 5, 1974, p.
into office and allow the Club to sponsor the Education Week Celebration"? It was 43,Empasized supplied). Despite the telegram of Director Bernardino which the
through his own act that the students were misled to do as they did. Coupled with the defendant received hours before the commencement executory on May 3-4,1966, he
defendants tacit recognition of the Club was the assurance of Mr. Jemm Dagoon, did not obey Director Bernardino because he said in his testimony that he would be
Club Adviser, who made the students believe that he was acting as an extension of embarrassment . Tan Feb 5,1974, P. 46). Evidently, he knew only his embarrassment
Mr. Ledesma's personality. (Exhibit "L"). and not that of r Bernardino whose order was being flagrantly and wantonly
disregarded by bim And certainly, not the least of Miss Delmo's embarrassment. His
Another badge of the defendan'ts want of good faith is the fact that, although, he acts speak eloquently of ho bad faith and unjust of mindwarped by his delicate
knew as early as April 27,1966 that per on of r Bernardino, Exhibit "L," he was sensitivity for having been challenged by Miss Delmo, a mere student.
directed to give honors to Miss Delmo, he kept Id information to . He told the Court
that he knew that the letter of Director Bernardino directed him not to deprive Miss xxx xxx xxx
Delmo the honors due her, but she (sic) says that he has not finished reading the
letter-decision, Exhibit "L," of Director Bernardino 0, him to give honors to Miss Finally the defendant's behaviour relative to Miss s case smacks of contemptuous
Delmo. (Tsn, Feb. 5, 1974, testimony of Mr. Ledesma, pp. .33-35). It could not be arrogance, oppression and abuse of power. Come to think of it. He refused to obey the
true that he has not finished reading the letter-decision, Exh. "L," because said letter directive of Be o and instead, chose to feign ignorance of it." (Reward on Appeal, p.
consisted of only three pages, and the portion which directed that Miss Delmo "be not 72-76).
deprived of any award, citation or honor from the school, if otherwise entitled thereto
is found at the last paragraph of the same. How did he know the last paragraph if he The trial court awarded P20,000.00 to the estate of Violeta Delmo and P10,000.00 to
did not read the letter. her parents for moral damages; P5,000.00 for nominal damages to Violeta's estate;
exemplary damages of P10,000.00 and P2,000.00 attorney's fees.
Defendants actuations regarding Miss Delmo's cam had been one of bias and
prejudice. When his action would favor him, he was deliberate and aspect to the utter On appeal, the Court of Appeals affirmed the decision. Hence, this petition.
prejudice and detriment of Miss Delmo. Thus, although, as early as April 27, 1966, he
knew of the exoneration of Miss Delino by Director Bernardino, he withheld the The issues raised in this petition can be reduced to the sole question of whether or not
information from Miss Delmo. This is eloquently dramatized by Exh. "11" and Exh. the respondent Court of Appeals erred in affirming the trial court's finding that
"13" On April 29,1966, Director Bernardino cabled him to furnish Violeta Delmo petitioner is liable for damages under Article 27 of the New Civil Code.
We find no reason why the findings of the trial and appellate courts should be Defendant, being a public officer should have acted with circumspection and due
reversed. It cannot be disputed that Violeta Delmo went through a painful ordeal regard to the rights of Miss Delmo. Inasmuch as he exceeded the scope of his
which was brought about by the petitioner's neglect of duty and callousness. Thus, authority by defiantly disobeying the lawful directive of his superior, Director
moral damages are but proper. As we have affirmed in the case of (Prudenciado v. Bernardino, defendant is liable for damages in his personal capacity. . . . (Rollo, pp-
Alliance Transport System, Inc., 148 SCRA 440, 448): 57-58)

There is no argument that moral damages include physical suffering, mental anguish, Based on the undisputed facts, exemplary damages are also in order. In the same case
fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, social of Prudenciado v. Alliance Transport System, Inc., supra., at p. 450, we ruled:
humiliation, and similar injury. Though incapable of pecuniary computation, moral
damages may be recovered if they are the proximate result of defendant's wrongly act The rationale behind exemplary or corrective damages is, as the name implies, to
or omission." (People v. Baylon, 129 SCRA 62 (1984). provide an example or correction for the public good (Lopez, et al. v. Pan American
World Airways, 16 SCRA 431).
The Solicitor-General tries to cover-up the petitioner's deliberate omission to inform
Miss Delmo by stating that it was not the duty of the petitioner to furnish her a copy However, we do not deem it appropriate to award the spouses Delmo damages in the
of the Director's decision. Granting this to be true, it was nevertheless the petitioner's amount of P10,000.00 in their individual capacity, separately from and in addition to
duty to enforce the said decision. He could have done so considering that he received what they are already entitled to as sole heirs of the deceased Violeta Delmo. Thus,
the decision on April 27, 1966 and even though he sent it back with the records of the the decision is modified insofar as moral damages are awarded to the spouses in their
case, he undoubtedly read the whole of it which consisted of only three pages. own behalf.
Moreover, the petitioner should have had the decency to meet with Mr. Delmo, the
girl's father, and inform the latter, at the very least of the decision. This, the petitioner WHEREFORE, the petition is DISMISSED for lack of merit. The decision of the
likewise failed to do, and not without the attendant bad faith which the appellate court Court of Appeals is AFFIRMED with the slight modification as stated in the
correctly pointed out in its decision, to wit: preceding paragraph. This decision is immediately executory.

Third, assuming that defendant could not furnish Miss Delmo of a copy of the SO ORDERED.
decision, he could have used his discretion and plain common sense by informing her
about it or he could have directed the inclusion of Miss Delmo's honor in the printed A.C. No. 8261, March 11, 2015
commencement program or announced it during the commencement exercises.
JESSIE T. CAMPUGAN AND ROBERT C. TORRES,
Fourth, defendant despite receipt of the telegram of Director Benardino hours before
the commencement exercises on May 3-4, 1966, disobeyed his superior by refusing to Complainants, v. ATTY. FEDERICO S. TOLENTINO, JR., ATTY.
give the honors due Miss Delmo with a lame excuse that he would be embarrassed if RENATO G. CUNANAN, ATTY. DANIEL F. VICTORIO, JR.,
he did so, to the prejudice of and in complete disregard of Miss Delmo's rights. AND ATTY. ELBERT T. QUILALA, Respondents.

Fifth, defendant did not even extend the courtesy of meeting Mr. Pacifico Delmo, A.C. No. 8725
father of Miss Delmo, who tried several times to see defendant in his office thus Mr.
Delmo suffered extreme disappointment and humiliation.

xxx xxx xxx

JESSIE T. CAMPUGAN AND ROBERT C. TORRES,
Complainants, v. ATTY. CONSTANTE P. CALUYA, JR., AND 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
ATTY. ELBERT T. QUILALA, Respondent.
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
DECISION 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
BERSAMIN, J.: February 26, 2008,6\ which the RTC granted in its order dated May 16, 2008 upon
noting the defendants' lack of objection thereto and the defendants' willingness to
In this consolidated administrative case, complainants Jessie T. Campugan and similarly withdraw their counterclaim.
Robert C. Torres seek the disbarment of respondents Atty. Federico S. Tolentino, Jr.,
Atty. Daniel F. Victorio, Jr., Atty. Renato G. Cunanan, Atty. Elbert T. Quilala and The complainants alleged that from the time of the issuance by the RTC of the order
Atty. Constante P. Caluya, Jr. for allegedly falsifying a court order that became the dated May 16, 2008, they could no longer locate or contact Atty. Victorio, Jr. despite
basis for the cancellation of their annotation of the notice of adverse claim and the making several phone calls and visits to his office; that they found out upon
notice of lis pendens in the Registry of Deeds in Quezon City. verification at the Register of Deeds of Quezon City that new annotations were made
on TCT No. N-290546, specifically: (1) the annotation of the letter-request appearing
to be filed by Atty. Tolentino, Jr. seeking the cancellation of the affidavit of adverse
Antecedents claim and the notice of lis pendens annotated on TCT No. N-290546; and (2) the
arinotation of the decision dated May 16, 2008 rendered in Civil Case No. Q-07-
Atty. Victorio, Jr. had replaced Atty. Edgardo Abad as counsel of the complainants in 59598 by the RTC, Branch 95, in Quezon City, granting the complainants' Motion to
a civil action they brought to seek the annulment of Transfer Certificate of Title Withdraw Complaint; and that a copy of the letter-request dated June 30, 2008
(TCT) No. N-290546 of the Registry of Deeds of Quezon City in the first week of addressed to Atty. Quilala, Registrar of Deeds of Quezon City, disclosed that it was
January 2007 in the Regional Trial Court (RTC) in Quezon City (Civil Case No. Q- defendant Ramon Ricafort who had signed the letter.
07-59598). 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. Feeling aggrieved by their discovery, the complainants filed an appeal en consulta
N-290546 their affidavit of adverse claim, as well as the notice of lis pendens. Atty. with the Land Registration Authority (LRA), docketed as Consulta No. 4707,
Tolentino, Jr. was the counsel of defendant Ramon and Josefina Ricafort. assailing the unlawful cancellation of their notice of adverse claim and their notice of
lis pendens under primary entries PE-2742 and PE-3828-9, respectively. The LRA set
In their sworn complaint for disbarment dated April 23, 2009 (later docketed as A.C. Consulta No. 4707 for hearing on March 30, 2009, and directed the parties to submit
No. 8261),2 the complainants narrated that as the surviving children of the late their respective memoranda and/or supporting documents on or before such scheduled
Spouses Antonio and Nemesia Torres, they inherited upon the deaths of their parents hearing. However, the records do not disclose whether Consulta No. 4707 was
a residential lot located at No. 251 Boni Serrano Street, Murphy, Cubao, Quezon City already resolved, or remained pending at the LRA.
registered under Transfer Certificate of Title (TCT) No. RT-64333(35652) of the
Register of Deeds of Quezon City; that on August 24, 2006, they discovered that TCT Unable to receive any response or assistance from Atty. Victorio, Jr. despite their
No. RT-64333(35652) had been unlawfully cancelled and replaced by TCT No. N- having paid him for his professional services, the complainants felt that said counsel
290546 of the Register of Deeds of Quezon City under the names of Ramon and had abandoned their case. They submitted that the cancellation of their notice of
Josefina Ricafort; and that, accordingly, they immediately caused the annotation of adverse claim and their notice of lis pendens without a court order specifically
their affidavit of adverse claim on TCT No. N-290546. allowing such cancellation resulted from the connivance and conspiracy between
Atty. Victorio, Jr. and Atty. Tolentino, Jr., and from the taking advantage of their
positions as officials in the Registry of Deeds by respondents Atty. Quilala, the Chief Atty. Cunanan did not file any comment.
Registrar, and Atty. Cunanan, the acting Registrar and signatory of the new
annotations. Thus, they claimed to be thereby prejudiced. As the result of Atty. Quilala's allegation in his Comment in A.C. No. 8261 that it had
been Atty. Caluya, Jr.'s signature that appeared below the cancelled entries, the
On July 6, 2009, the Court required the respondents to comment on the verified complainants filed another sworn disbarment complaint dated August 26, 2010
complaint. alleging that Atty. Caluya, Jr. had forged the signature of Atty. Cunanan. This
disbarment complaint was docketed as A.C. No. 8725, and was later on consolidated
Atty. Victorio, Jr. asserted in his Comment dated August 17, 200912 that complainant with A.C. No. 826117 because the complaints involved the same parties and rested on
Robert Torres had been actively involved in the proceedings in Civil Case No. Q-07- similar allegations against the respondents.
59598, which included the mediation process; that the complainants, after having
aggressively participated in the drafting of the amicable settlement, could not now Atty. Quilala filed his Comment in A.C. No. 8725 to belie the allegation of forgery
claim that they had been deceived into entering the agreement in the same way that and to reiterate the arguments he had made in A.C. No. 8261. On his part, Atty.
they could not feign ignorance of the conditions contained therein; that he did not Caluya, Jr. manifested that he adopted Atty. Quilala's Comment.
commit any abandonment as alleged, but had performed in good faith his duties as the
counsel for the complainants in Civil Case No. Q-07-59598; that he should not be Ruling
held responsible for their representation in other proceedings, such as that before the
LRA, which required a separate engagement; and that the only payment he had We dismiss the complaints for disbarment for being bereft of merit.
received from the complainants were those for his appearance fees of P1,000.00 for
every hearing in the RTC. Well entrenched in this jurisdiction is the rule that a lawyer may be disciplined for
misconduct committed either in his professional or private capacity. The test is
In his Comment dated August 24, 2009, Atty. Tolentino, Jr. refuted the charge of whether his conduct shows him to be wanting in moral character, honesty, probity,
conspiracy, stressing that he was not acquainted with the other respondents, except and good demeanor, or whether his conduct renders him unworthy to continue as an
Atty. Victorio, Jr. whom he had met during the hearings in Civil Case No. Q-07- officer of the Court. Verily, Canon 7 of the Code of Professional Responsibility
59598; that although he had notarized the letter-request dated June 30, 2008 of mandates all lawyers to uphold at all times the dignity and integrity of the Legal
Ramon Ricafort to the Register of Deeds, he had no knowledge about how said letter- Profession. Lawyers are similarly required under Rule 1.01, Canon 1 of the same
request had been disposed of by the Register of Deeds; and that the present complaint Code not to engage in any unlawful, dishonest and immoral or deceitful conduct.
was the second disbarment case filed by the complainants against him with no other Failure to observe these tenets of the Code of Professional Responsibility exposes the
motive except to harass and intimidate him. lawyer to disciplinary sanctions as provided in Section 27, Rule 138 of the Rules of
Court, as amended, viz.:
Atty. Quilala stated in his Comment dated September 1, 2009 that it was Atty. Section 27. Disbarment or suspension of attorneys by Supreme Court, grounds
Caluya, Jr., another Deputy Register of Deeds, who was the actual signing authority therefor. — A member of the bar may be disbarred or suspended from his office as
of the annotations that resulted in the cancellation of the affidavit of adverse claim attorney by the Supreme Court for any deceit, malpractice, or other gross misconduct
and the notice of lis pendens on TCT No. N-290546; that the cancellation of the in such office, grossly immoral conduct, or by reason of his conviction of a crime
annotations was undertaken in the regular course of official duty and in the exercise involving moral turpitude, or for any violation of the oath which he is required to take
of the ministerial duty of the Register of Deeds; that no irregularity occurred or was before the admission to practice, or for a wilful disobedience appearing as an attorney
performed in the cancellation of the annotations; and that the Register of Deeds was for a party to a case without authority so to do. The practice of soliciting cases at law
impleaded in Civil Case No. Q-07-59598 only as a nominal party, thereby for the purpose of gain, either personally or through paid agents or brokers,
discounting any involvement in the proceedings in the case. constitutes malpractice.
The complainants' allegations of the respondents' acts and omissions are insufficient be in conformity with existing requirements, it became obligatory for them to perform
to establish any censurable conduct against them. their ministerial duty without unnecessary delay.

Section 10 of Presidential Decree No. 1529 (Property Registration Decree) Should they be aggrieved by said respondents' performance of duty, complainants
enumerates the general duties of the Register of Deeds, as were not bereft of any remedy because they could challenge the performance of duty
Section 10. General functions of Registers of Deeds. - x x x by bringing the matter by way of consulta with the LRA, as provided by Section
11725 of Presidential Decree No. 1529. But, as enunciated in Gabriel v. Register of
It shall be the duty of the Register of Deeds to immediately register an instrument Deeds of Rizal, it was ultimately within the province of a court of competent
presented for registration dealing with real or personal property which complies jurisdiction to resolve issues concerning the validity or invalidity of a document
with all the requisites for registration. He shall see to it that said instrument bears registered by the Register of Deeds.
the proper documentary science stamps and that the same are properly canceled.
If the instrument is not registrable, he shall forthwith deny registration thereof The complainants charge Atty. Victorio, Jr. and Atty. Tolentino, Jr. with having
and inform the presenter of such denial in writing, stating the ground or reason conspired with each other to guarantee that the parties in Civil Case No. Q-59598
therefor, and advising him of his right to appeal by consulta in accordance with would enter into the amicable settlement, and then to cause the cancellation of the
Section 117 of this Decree. (Emphasis supplied) affidavit of adverse claim and notice of lis pendens annotated on TCT No. N-290546.
The aforementioned duty of the Register of Deeds is ministerial in nature. A The complainants further fault Atty. Victorio, Jr. with having abandoned their cause
purely ministerial act or duty is one that an officer or tribunal performs in a given since the issuance of the RTC of its order dated May 16, 2008.
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 The complainants' charges are devoid of substance.
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, Although it is not necessary to prove a formal agreement in order to establish
such duty is discretionary, not ministerial. The duty is ministerial only when its conspiracy because conspiracy may be inferred from the circumstances attending the
discharge requires neither the exercise of official discretion nor the exercise of commission of an act, it is nonetheless essential that conspiracy be established by
judgment. clear and convincing evidence. The complainants failed in this regard. Outside of
their bare assertions that Atty. Victorio, Jr. and Atty. Tolentino, Jr. had conspired
In Gabriel v. Register of Deeds of Rizal, the Court underscores that registration is a with each other in order to cause the dismissal of the complaint and then discharge of
merely ministerial act of the Register of Deeds, the annotations, they presented no evidence to support their allegation of conspiracy.
xxx [W]hether the document is invalid, frivolous or intended to harass, is not the duty On the contrary, the records indicated their own active participation in arriving at the
of a Register of Deeds to decide, but a court of competent jurisdiction, and that it is amicable settlement with the defendants in Civil Case No. Q-07-59598. Hence, they
his concern to see whether the documents sought to be registered conform with the could not now turn their backs on the amicable settlement that they had themselves
formal and legal requirements for such documents. entered into.
In view of the foregoing, we find no abuse of authority or irregularity committed by
Atty. Quilala, Atty. Cunanan, and Atty. Caluya, Jr. with respect to the cancellation of Even assuming that Atty. Victorio, Jr. and Atty. Tolentino, Jr. initiated and
the notice of adverse claim and the notice of lis pendens annotated on TCT No. N- participated in the settlement of the case, there was nothing wrong in their doing so. It
290546. Whether or not the RTC order dated May 16, 2008 or the letter-request dated was actually their obligation as lawyers to do so, pursuant to Rule 1.04, Canon 1 of
June 30, 2008 had been falsified, fraudulent or invalid was not for them to determine the Code of Professional Responsibility, viz.:
inasmuch as their duty to examine documents presented for registration was limited RULE 1.04 - A lawyer shall encourage his clients to avoid, end or settle a controversy
only to what appears on the face of the documents. If, upon their evaluation of the if it will admit of a fair settlement.
letter-request and the RTC order, they found the same to be sufficient in law and t]o
In fine, the presumption of the validity of the amicable settlement of the complainants
and the defendants in Civil Case No. Q-07-59598 subsisted. SO ORDERED.

Anent the complainants' charge of abandonment against Atty. Victorio, Jr., Rule
18.03 and Rule 18.04, Canon 18 of the Code of Professional Responsibility are
ARTICLES 29-35
applicable, to
CANON 18 - A lawyer shall serve his client with competence and diligence. G.R. No. 102007 September 2, 1994

Rule 18.03 - A lawyer shall not neglect a legal matter entrusted to him, and his PEOPLE OF THE PHILIPPINES, plaintiff-appellee,
negligence in connection therewith shall render him liable. vs.
ROGELIO BAYOTAS y CORDOVA, accused-appellant.
Rule 18.04 - A lawyer shall keep the client informed of the status of his case and shall
respond within a reasonable time to the client's request for information.
There is no issue that the complainants engaged the services of Atty. Victorio, Jr. as The Solicitor General for plaintiff-appellee.
their counsel in Civil Case No. Q-07-59598. Atty. Victorio, Jr. served as such
counsel. With Atty. Victorio, Jr. assistance, the complainants obtained a fair Public Attorney's Office for accused-appellant.
settlement consisting in receiving half of the proceeds of the sale of the property in
litis, without any portion of the proceeds accruing to counsel as his legal fees. The
complainants did not competently and persuasively show any unfaithfulness on the
ROMERO, J.:
part of Atty. Victorio, Jr. as far as their interest in the litigation was concerned.
Hence, Atty. Victorio, Jr. was not liable for abandonment.
In Criminal Case No. C-3217 filed before Branch 16, RTC Roxas City, Rogelio
Bayotas y Cordova was charged with Rape and eventually convicted thereof on June
Atty. Victorio, Jr. could not be faulted for the perceived inattention to any other
19, 1991 in a decision penned by Judge Manuel E. Autajay. Pending appeal of his
matters subsequent to the termination of Civil Case No. Q-07-59598. Unless
conviction, Bayotas died on February 4, 1992 at the National Bilibid Hospital due to
otherwise expressly stipulated between them at any time during the engagement, the
cardio respiratory arrest secondary to hepatic encephalopathy secondary to hipato
complainants had no right to assume that Atty. Victorio, Jr.'s legal representation was
carcinoma gastric malingering. Consequently, the Supreme Court in its Resolution of
indefinite as to extend to his representation of them in the LRA. The Law Profession
May 20, 1992 dismissed the criminal aspect of the appeal. However, it required the
did not burden its members with the responsibility of indefinite service to the clients;
Solicitor General to file its comment with regard to Bayotas' civil liability arising
hence, the rendition of professional services depends on the agreement between the
from his commission of the offense charged.
attorney and the client. Atty. Victorio, Jr.'s alleged failure to respond to the
complainants' calls or visits, or to provide them with his whereabouts to enable them
In his comment, the Solicitor General expressed his view that the death of accused-
to have access to him despite the termination of his engagement in Civil Case No. Q-
appellant did not extinguish his civil liability as a result of his commission of the
07-59598 did not equate to abandonment without the credible showing that he
offense charged. The Solicitor General, relying on the case of People v. Sendaydiego
continued to come under the professional obligation towards them after the
insists that the appeal should still be resolved for the purpose of reviewing his
termination of Civil Case No. Q-07-59598.
conviction by the lower court on which the civil liability is based.
WHEREFORE, the Court DISMISSES the baseless disbarment complaints against
Counsel for the accused-appellant, on the other hand, opposed the view of the
Atty. Federico S. Tolentino, Jr., Atty. Renato G. Cunanan, Atty. Daniel F. Victorio,
Solicitor General arguing that the death of the accused while judgment of conviction
Jr., Atty. Elbert T. Quilala and Atty. Constante P. Caluya, Jr.
is pending appeal extinguishes both his criminal and civil penalties. In support of his
position, said counsel invoked the ruling of the Court of Appeals in People v. Castillo 1. Por la muerte del reo en cuanto a las penas personales siempre, y respecto a las
and Ocfemia which held that the civil obligation in a criminal case takes root in the pecuniarias, solo cuando a su fallecimiento no hubiere recaido sentencia firme.
criminal liability and, therefore, civil liability is extinguished if accused should die
before final judgment is rendered. xxx xxx xxx

We are thus confronted with a single issue: Does death of the accused pending appeal The code of 1870 . . . it will be observed employs the term "sentencia firme." What is
of his conviction extinguish his civil liability? "sentencia firme" under the old statute?

In the aforementioned case of People v. Castillo, this issue was settled in the XXVIII Enciclopedia Juridica Española, p. 473, furnishes the ready answer: It says:
affirmative. This same issue posed therein was phrased thus: Does the death of
Alfredo Castillo affect both his criminal responsibility and his civil liability as a SENTENCIA FIRME. La sentencia que adquiere la fuerza de las definitivas por no
consequence of the alleged crime? haberse utilizado por las partes litigantes recurso alguno contra ella dentro de los
terminos y plazos legales concedidos al efecto.
It resolved this issue thru the following disquisition:
"Sentencia firme" really should be understood as one which is definite. Because, it is
Article 89 of the Revised Penal Code is the controlling statute. It reads, in part: only when judgment is such that, as Medina y Maranon puts it, the crime is confirmed
— "en condena determinada;" or, in the words of Groizard, the guilt of the accused
Art. 89. How criminal liability is totally extinguished. — Criminal liability is totally becomes — "una verdad legal." Prior thereto, should the accused die, according to
extinguished: Viada, "no hay legalmente, en tal caso, ni reo, ni delito, ni responsabilidad criminal
de ninguna clase." And, as Judge Kapunan well explained, when a defendant dies
1. By the death of the convict, as to the personal penalties; and as to the pecuniary before judgment becomes executory, "there cannot be any determination by final
penalties liability therefor is extinguished only when the death of the offender occurs judgment whether or not the felony upon which the civil action might arise exists,"
before final judgment; for the simple reason that "there is no party defendant." (I Kapunan, Revised Penal
Code, Annotated, p. 421. Senator Francisco holds the same view. Francisco, Revised
With reference to Castillo's criminal liability, there is no question. The law is plain. Penal Code, Book One, 2nd ed., pp. 859-860)
Statutory construction is unnecessary. Said liability is extinguished.
The legal import of the term "final judgment" is similarly reflected in the Revised
The civil liability, however, poses a problem. Such liability is extinguished only when Penal Code. Articles 72 and 78 of that legal body mention the term "final judgment"
the death of the offender occurs before final judgment. Saddled upon us is the task of in the sense that it is already enforceable. This also brings to mind Section 7, Rule
ascertaining the legal import of the term "final judgment." Is it final judgment as 116 of the Rules of Court which states that a judgment in a criminal case becomes
contradistinguished from an interlocutory order? Or, is it a judgment which is final final "after the lapse of the period for perfecting an appeal or when the sentence has
and executory? been partially or totally satisfied or served, or the defendant has expressly waived in
writing his right to appeal."
We go to the genesis of the law. The legal precept contained in Article 89 of the
Revised Penal Code heretofore transcribed is lifted from Article 132 of the Spanish El By fair intendment, the legal precepts and opinions here collected funnel down to one
Codigo Penal de 1870 which, in part, recites: positive conclusion: The term final judgment employed in the Revised Penal Code
means judgment beyond recall. Really, as long as a judgment has not become
La responsabilidad penal se extingue.
executory, it cannot be truthfully said that defendant is definitely guilty of the felony On the other hand, this Court in the subsequent cases of Buenaventura Belamala v.
charged against him. Marcelino Polinar and Lamberto Torrijos v. The Honorable Court of Appeals ruled
differently. In the former, the issue decided by this court was: Whether the civil
Not that the meaning thus given to final judgment is without reason. For where, as in liability of one accused of physical injuries who died before final judgment is
this case, the right to institute a separate civil action is not reserved, the decision to be extinguished by his demise to the extent of barring any claim therefore against his
rendered must, of necessity, cover "both the criminal and the civil aspects of the estate. It was the contention of the administrator-appellant therein that the death of the
case." People vs. Yusico (November 9, 1942), 2 O.G., No. 100, p. 964. See also: accused prior to final judgment extinguished all criminal and civil liabilities resulting
People vs. Moll, 68 Phil., 626, 634; Francisco, Criminal Procedure, 1958 ed., Vol. I, from the offense, in view of Article 89, paragraph 1 of the Revised Penal Code.
pp. 234, 236. Correctly, Judge Kapunan observed that as "the civil action is based However, this court ruled therein:
solely on the felony committed and of which the offender might be found guilty, the
death of the offender extinguishes the civil liability." I Kapunan, Revised Penal Code, We see no merit in the plea that the civil liability has been extinguished, in view of
Annotated, supra. the provisions of the Civil Code of the Philippines of 1950 (Rep. Act No. 386) that
became operative eighteen years after the revised Penal Code. As pointed out by the
Here is the situation obtaining in the present case: Castillo's criminal liability is out. Court below, Article 33 of the Civil Code establishes a civil action for damages on
His civil liability is sought to be enforced by reason of that criminal liability. But account of physical injuries, entirely separate and distinct from the criminal action.
then, if we dismiss, as we must, the criminal action and let the civil aspect remain, we
will be faced with the anomalous situation whereby we will be called upon to clamp Art. 33. In cases of defamation, fraud, and physical injuries, a civil action for
civil liability in a case where the source thereof — criminal liability — does not exist. damages, entirely separate and distinct from the criminal action, may be brought by
And, as was well stated in Bautista, et al. vs. Estrella, et al., CA-G.R. the injured party. Such civil action shall proceed independently of the criminal
No. 19226-R, September 1, 1958, "no party can be found and held criminally liable in prosecution, and shall require only a preponderance of evidence.
a civil suit," which solely would remain if we are to divorce it from the criminal
proceeding." Assuming that for lack of express reservation, Belamala's civil action for damages
was to be considered instituted together with the criminal action still, since both
This ruling of the Court of Appeals in the Castillo case 3 was adopted by the Supreme proceedings were terminated without final adjudication, the civil action of the
Court in the cases of People of the Philippines v. Bonifacio Alison, et al., 4 People of offended party under Article 33 may yet be enforced separately.
the Philippines v. Jaime Jose, et al. 5 and People of the Philippines v. Satorre 6 by
dismissing the appeal in view of the death of the accused pending appeal of said In Torrijos, the Supreme Court held that:
cases.
xxx xxx xxx
As held by then Supreme Court Justice Fernando in the Alison case:
It should be stressed that the extinction of civil liability follows the extinction of the
The death of accused-appellant Bonifacio Alison having been established, and criminal liability under Article 89, only when the civil liability arises from the
considering that there is as yet no final judgment in view of the pendency of the criminal act as its only basis. Stated differently, where the civil liability does not exist
appeal, the criminal and civil liability of the said accused-appellant Alison was independently of the criminal responsibility, the extinction of the latter by death, ipso
extinguished by his death (Art. 89, Revised Penal Code; Reyes' Criminal Law, 1971 facto extinguishes the former, provided, of course, that death supervenes before final
Rev. Ed., p. 717, citing People v. Castillo and Ofemia C.A., 56 O.G. 4045); judgment. The said principle does not apply in instant case wherein the civil liability
consequently, the case against him should be dismissed. springs neither solely nor originally from the crime itself but from a civil contract of
purchase and sale. (Emphasis ours)
xxx xxx xxx court to continue exercising appellate jurisdiction over the entire appeal, passing upon
the correctness of Sendaydiego's conviction despite dismissal of the criminal action,
In the above case, the court was convinced that the civil liability of the accused who for the purpose of determining if he is civilly liable. In doing so, this Court issued a
was charged with estafa could likewise trace its genesis to Articles 19, 20 and 21 of Resolution of July 8, 1977 stating thus:
the Civil Code since said accused had swindled the first and second vendees of the
property subject matter of the contract of sale. It therefore concluded: "Consequently, The claim of complainant Province of Pangasinan for the civil liability survived
while the death of the accused herein extinguished his criminal liability including Sendaydiego because his death occurred after final judgment was rendered by the
fine, his civil liability based on the laws of human relations remains." Court of First Instance of Pangasinan, which convicted him of three complex crimes
of malversation through falsification and ordered him to indemnify the Province in
Thus it allowed the appeal to proceed with respect to the civil liability of the accused, the total sum of P61,048.23 (should be P57,048.23).
notwithstanding the extinction of his criminal liability due to his death pending appeal
of his conviction. The civil action for the civil liability is deemed impliedly instituted with the criminal
action in the absence of express waiver or its reservation in a separate action (Sec. 1,
To further justify its decision to allow the civil liability to survive, the court relied on Rule 111 of the Rules of Court). The civil action for the civil liability is separate and
the following ratiocination: Since Section 21, Rule 3 of the Rules of Court 9 requires distinct from the criminal action (People and Manuel vs. Coloma, 105 Phil. 1287; Roa
the dismissal of all money claims against the defendant whose death occurred prior to vs. De la Cruz, 107 Phil. 8).
the final judgment of the Court of First Instance (CFI), then it can be inferred that
actions for recovery of money may continue to be heard on appeal, when the death of When the action is for the recovery of money and the defendant dies before final
the defendant supervenes after the CFI had rendered its judgment. In such case, judgment in the Court of First Instance, it shall be dismissed to be prosecuted in the
explained this tribunal, "the name of the offended party shall be included in the title manner especially provided in Rule 87 of the Rules of Court (Sec. 21, Rule 3 of the
of the case as plaintiff-appellee and the legal representative or the heirs of the Rules of Court).
deceased-accused should be substituted as defendants-appellants."
The implication is that, if the defendant dies after a money judgment had been
It is, thus, evident that as jurisprudence evolved from Castillo to Torrijos, the rule rendered against him by the Court of First Instance, the action survives him. It may be
established was that the survival of the civil liability depends on whether the same continued on appeal (Torrijos vs. Court of Appeals, L-40336, October 24, 1975; 67
can be predicated on sources of obligations other than delict. Stated differently, the SCRA 394).
claim for civil liability is also extinguished together with the criminal action if it were
solely based thereon, i.e., civil liability ex delicto. The accountable public officer may still be civilly liable for the funds improperly
disbursed although he has no criminal liability (U.S. vs. Elvina, 24 Phil. 230;
However, the Supreme Court in People v. Sendaydiego, et al. 10 departed from this Philippine National Bank vs. Tugab, 66 Phil. 583).
long-established principle of law. In this case, accused Sendaydiego was charged with
and convicted by the lower court of malversation thru falsification of public In view of the foregoing, notwithstanding the dismissal of the appeal of the deceased
documents. Sendaydiego's death supervened during the pendency of the appeal of his Sendaydiego insofar as his criminal liability is concerned, the Court Resolved to
conviction. continue exercising appellate jurisdiction over his possible civil liability for the
money claims of the Province of Pangasinan arising from the alleged criminal acts
This court in an unprecedented move resolved to dismiss Sendaydiego's appeal but complained of, as if no criminal case had been instituted against him, thus making
only to the extent of his criminal liability. His civil liability was allowed to survive applicable, in determining his civil liability, Article 30 of the Civil Code . . . and, for
although it was clear that such claim thereon was exclusively dependent on the that purpose, his counsel is directed to inform this Court within ten (10) days of the
criminal action already extinguished. The legal import of such decision was for the names and addresses of the decedent's heirs or whether or not his estate is under
administration and has a duly appointed judicial administrator. Said heirs or asserted in the criminal action or in a separate civil action, civil liability ex delicto is
administrator will be substituted for the deceased insofar as the civil action for the extinguished by the death of the accused while his conviction is on appeal. Article 89
civil liability is concerned (Secs. 16 and 17, Rule 3, Rules of Court). of the Revised Penal Code is clear on this matter:

Succeeding cases raising the identical issue have maintained adherence to our ruling Art. 89. How criminal liability is totally extinguished. — Criminal liability is totally
in Sendaydiego; in other words, they were a reaffirmance of our abandonment of the extinguished:
settled rule that a civil liability solely anchored on the criminal (civil liability ex
delicto) is extinguished upon dismissal of the entire appeal due to the demise of the 1. By the death of the convict, as to the personal penalties; and as to pecuniary
accused. penalties, liability therefor is extinguished only when the death of the offender occurs
before final judgment;
But was it judicious to have abandoned this old ruling? A re-examination of our
decision in Sendaydiego impels us to revert to the old ruling. xxx xxx xxx

To restate our resolution of July 8, 1977 in Sendaydiego: The resolution of the civil However, the ruling in Sendaydiego deviated from the expressed intent of Article 89.
action impliedly instituted in the criminal action can proceed irrespective of the It allowed claims for civil liability ex delicto to survive by ipso facto treating the civil
latter's extinction due to death of the accused pending appeal of his conviction, action impliedly instituted with the criminal, as one filed under Article 30, as though
pursuant to Article 30 of the Civil Code and Section 21, Rule 3 of the Revised Rules no criminal proceedings had been filed but merely a separate civil action. This had
of Court. the effect of converting such claims from one which is dependent on the outcome of
the criminal action to an entirely new and separate one, the prosecution of which does
Article 30 of the Civil Code provides: not even necessitate the filing of criminal proceedings. One would be hard put to
pinpoint the statutory authority for such a transformation. It is to be borne in mind
When a separate civil action is brought to demand civil liability arising from a that in recovering civil liability ex delicto, the same has perforce to be determined in
criminal offense, and no criminal proceedings are instituted during the pendency of the criminal action, rooted as it is in the court's pronouncement of the guilt or
the civil case, a preponderance of evidence shall likewise be sufficient to prove the innocence of the accused. This is but to render fealty to the intendment of Article 100
act complained of. of the Revised Penal Code which provides that "every person criminally liable for a
felony is also civilly liable." In such cases, extinction of the criminal action due to
Clearly, the text of Article 30 could not possibly lend support to the ruling in death of the accused pending appeal inevitably signifies the concomitant extinction of
Sendaydiego. Nowhere in its text is there a grant of authority to continue exercising the civil liability. Mors Omnia Solvi. Death dissolves all things.
appellate jurisdiction over the accused's civil liability ex delicto when his death
supervenes during appeal. What Article 30 recognizes is an alternative and separate In sum, in pursuing recovery of civil liability arising from crime, the final
civil action which may be brought to demand civil liability arising from a criminal determination of the criminal liability is a condition precedent to the prosecution of
offense independently of any criminal action. In the event that no criminal the civil action, such that when the criminal action is extinguished by the demise of
proceedings are instituted during the pendency of said civil case, the quantum of accused-appellant pending appeal thereof, said civil action cannot survive. The claim
evidence needed to prove the criminal act will have to be that which is compatible for civil liability springs out of and is dependent upon facts which, if true, would
with civil liability and that is, preponderance of evidence and not proof of guilt constitute a crime. Such civil liability is an inevitable consequence of the criminal
beyond reasonable doubt. Citing or invoking Article 30 to justify the survival of the liability and is to be declared and enforced in the criminal proceeding. This is to be
civil action despite extinction of the criminal would in effect merely beg the question distinguished from that which is contemplated under Article 30 of the Civil Code
of whether civil liability ex delicto survives upon extinction of the criminal action due which refers to the institution of a separate civil action that does not draw its life from
to death of the accused during appeal of his conviction. This is because whether a criminal proceeding. The Sendaydiego resolution of July 8, 1977, however, failed to
take note of this fundamental distinction when it allowed the survival of the civil
action for the recovery of civil liability ex delicto by treating the same as a separate Sadly, reliance on this provision of law is misplaced. From the standpoint of
civil action referred to under Article 30. Surely, it will take more than just a summary procedural law, this course taken in Sendaydiego cannot be sanctioned. As correctly
judicial pronouncement to authorize the conversion of said civil action to an observed by Justice Regalado:
independent one such as that contemplated under Article 30.
xxx xxx xxx
Ironically however, the main decision in Sendaydiego did not apply Article 30, the
resolution of July 8, 1977 notwithstanding. Thus, it was held in the main decision: I do not, however, agree with the justification advanced in both Torrijos and
Sendaydiego which, relying on the provisions of Section 21, Rule 3 of the Rules of
Sendaydiego's appeal will be resolved only for the purpose of showing his criminal Court, drew the strained implication therefrom that where the civil liability instituted
liability which is the basis of the civil liability for which his estate would be liable. together with the criminal liabilities had already passed beyond the judgment of the
then Court of First Instance (now the Regional Trial Court), the Court of Appeals can
In other words, the Court, in resolving the issue of his civil liability, concomitantly continue to exercise appellate jurisdiction thereover despite the extinguishment of the
made a determination on whether Sendaydiego, on the basis of evidenced adduced, component criminal liability of the deceased. This pronouncement, which has been
was indeed guilty beyond reasonable doubt of committing the offense charged. Thus, followed in the Court's judgments subsequent and consonant to Torrijos and
it upheld Sendaydiego's conviction and pronounced the same as the source of his civil Sendaydiego, should be set aside and abandoned as being clearly erroneous and
liability. Consequently, although Article 30 was not applied in the final determination unjustifiable.
of Sendaydiego's civil liability, there was a reopening of the criminal action already
extinguished which served as basis for Sendaydiego's civil liability. We reiterate: Said Section 21 of Rule 3 is a rule of civil procedure in ordinary civil actions. There
Upon death of the accused pending appeal of his conviction, the criminal action is is neither authority nor justification for its application in criminal procedure to civil
extinguished inasmuch as there is no longer a defendant to stand as the accused; the actions instituted together with and as part of criminal actions. Nor is there any
civil action instituted therein for recovery of civil liability ex delicto is ipso facto authority in law for the summary conversion from the latter category of an ordinary
extinguished, grounded as it is on the criminal. civil action upon the death of the offender. . . .

Section 21, Rule 3 of the Rules of Court was also invoked to serve as another basis Moreover, the civil action impliedly instituted in a criminal proceeding for recovery
for the Sendaydiego resolution of July 8, 1977. In citing Sec. 21, Rule 3 of the Rules of civil liability ex delicto can hardly be categorized as an ordinary money claim such
of Court, the Court made the inference that civil actions of the type involved in as that referred to in Sec. 21, Rule 3 enforceable before the estate of the deceased
Sendaydiego consist of money claims, the recovery of which may be continued on accused.
appeal if defendant dies pending appeal of his conviction by holding his estate liable
therefor. Hence, the Court's conclusion: Ordinary money claims referred to in Section 21, Rule 3 must be viewed in light of
the provisions of Section 5, Rule 86 involving claims against the estate, which in
"When the action is for the recovery of money" "and the defendant dies before final Sendaydiego was held liable for Sendaydiego's civil liability. "What are contemplated
judgment in the court of First Instance, it shall be dismissed to be prosecuted in the in Section 21 of Rule 3, in relation to Section 5 of Rule 86, 14 are contractual money
manner especially provided" in Rule 87 of the Rules of Court (Sec. 21, Rule 3 of the claims while the claims involved in civil liability ex delicto may include even the
Rules of Court). restitution of personal or real property." 15 Section 5, Rule 86 provides an exclusive
enumeration of what claims may be filed against the estate. These are: funeral
The implication is that, if the defendant dies after a money judgment had been expenses, expenses for the last illness, judgments for money and claim arising from
rendered against him by the Court of First Instance, the action survives him. It may be contracts, expressed or implied. It is clear that money claims arising from delict do
continued on appeal. not form part of this exclusive enumeration. Hence, there could be no legal basis in
(1) treating a civil action ex delicto as an ordinary contractual money claim referred
to in Section 21, Rule 3 of the Rules of Court and (2) allowing it to survive by filing a From this lengthy disquisition, we summarize our ruling herein:
claim therefor before the estate of the deceased accused. Rather, it should be
extinguished upon extinction of the criminal action engendered by the death of the 1. Death of the accused pending appeal of his conviction extinguishes his criminal
accused pending finality of his conviction. liability as well as the civil liability based solely thereon. As opined by Justice
Regalado, in this regard, "the death of the accused prior to final judgment terminates
Accordingly, we rule: if the private offended party, upon extinction of the civil his criminal liability and only the civil liability directly arising from and based solely
liability ex delicto desires to recover damages from the same act or omission on the offense committed, i.e., civil liability ex delicto in senso strictiore."
complained of, he must subject to Section 1, Rule 111 16 (1985 Rules on Criminal
Procedure as amended) file a separate civil action, this time predicated not on the 2. Corollarily, the claim for civil liability survives notwithstanding the death of
felony previously charged but on other sources of obligation. The source of obligation accused, if the same may also be predicated on a source of obligation other than
upon which the separate civil action is premised determines against whom the same delict. Article 1157 of the Civil Code enumerates these other sources of obligation
shall be enforced. from which the civil liability may arise as a result of the same act or omission:

If the same act or omission complained of also arises from quasi-delict or may, by a) Law 20
provision of law, result in an injury to person or property (real or personal), the
separate civil action must be filed against the executor or administrator 17 of the b) Contracts
estate of the accused pursuant to Sec. 1, Rule 87 of the Rules of Court:
c) Quasi-contracts
Sec. 1. Actions which may and which may not be brought against executor or
administrator. — No action upon a claim for the recovery of money or debt or interest d) . . .
thereon shall be commenced against the executor or administrator; but actions to
recover real or personal property, or an interest therein, from the estate, or to enforce e) Quasi-delicts
a lien thereon, and actions to recover damages for an injury to person or property, real
or personal, may be commenced against him. 3. Where the civil liability survives, as explained in Number 2 above, an action for
recovery therefor may be pursued but only by way of filing a separate civil action and
This is in consonance with our ruling in Belamala 18 where we held that, in subject to Section 1, Rule 111 of the 1985 Rules on Criminal Procedure as amended.
recovering damages for injury to persons thru an independent civil action based on This separate civil action may be enforced either against the executor/administrator or
Article 33 of the Civil Code, the same must be filed against the executor or the estate of the accused, depending on the source of obligation upon which the same
administrator of the estate of deceased accused and not against the estate under Sec. is based as explained above.
5, Rule 86 because this rule explicitly limits the claim to those for funeral expenses,
expenses for the last sickness of the decedent, judgment for money and claims arising 4. Finally, the private offended party need not fear a forfeiture of his right to file this
from contract, express or implied. Contractual money claims, we stressed, refers only separate civil action by prescription, in cases where during the prosecution of the
to purely personal obligations other than those which have their source in delict or criminal action and prior to its extinction, the private-offended party instituted
tort. together therewith the civil action. In such case, the statute of limitations on the civil
liability is deemed interrupted during the pendency of the criminal case, conformably
Conversely, if the same act or omission complained of also arises from contract, the with provisions of Article 1155 21 of the Civil Code, that should thereby avoid any
separate civil action must be filed against the estate of the accused, pursuant to Sec. 5, apprehension on a possible privation of right by prescription.
Rule 86 of the Rules of Court.
Applying this set of rules to the case at bench, we hold that the death of appellant file a criminal case for Reckless Imprudence Resulting in Homicide against Daluraya,
Bayotas extinguished his criminal liability and the civil liability based solely on the the purported driver of the vehicle.
act complained of, i.e., rape. Consequently, the appeal is hereby dismissed without
qualification. During the proceedings, the prosecution presented as witness Shem Serrano
(Serrano), an eye-witness to the incident, who testified that on said date, he saw a
WHEREFORE, the appeal of the late Rogelio Bayotas is DISMISSED with costs de woman crossing EDSA heading towards the island near the flyover and that the latter
oficio. was bumped by a Nissan Vanette bearing plate number UPN-172. The prosecution
also offered the testimonies of (a) Marla, who testified as to the civil damages
SO ORDERED. sustained by her family as a result of her mother’s death; (b) Dr. Paul Ortiz (Dr.
Ortiz), who presented his findings on the autopsy conducted upon the body of Marina
G.R. No. 210148 December 8, 2014 Oliva; and (c) Police Senior Inspector Lauro Gomez (PSI Gomez), who conducted the
investigation following the incident and claimed that Marina Oliva was hit by the
vehicle being driven by Daluraya, albeit he did not witness the incident.
ANTONIO L. DALURAYA, Petitioner,
vs. After the prosecution rested its case, Daluraya filed an Urgent Motion to Dismiss
(demurrer) asserting, inter alia, that he was not positively identified by any of the
MARLA OLIVA, Respondent. prosecution witnesses as the driver of the vehicle that hit the victim, and that there
was no clear and competent evidence of how the incident transpired.
DECISION
The MeTC Ruling

PERLAS-BERNABE, J.: In an Order dated May 24, 2010, the Metropolitan Trial Court of Quezon City,
Branch 38 (MeTC) granted Daluraya’s demurrer and dismissed the case for
Assailed in this petition for review on certiorari are the Decision dated June 28, 2013 insufficiency of evidence. It found that the testimonies of the prosecution witnesses
and the Resolution dated November 22, 2013 rendered by the Court of Appeals (CA) were wanting in material details and that they failed to sufficiently establish that
in CA-G.R. SP No. 125113 finding petitioner Antonio L. Daluraya (Daluraya) civilly Daluraya committed the crime imputed upon him. Deconstructing the testimonies of
liable for the death of Marina Arabit Oliva (Marina Oliva) despite having been the prosecution witnesses individually, the MeTC found that: (a) Marla merely
acquitted for Reckless Imprudence Resulting in Homicide on the ground of testified on the damages sustained by her family but she failed to identify Daluraya as
insufficiency of evidence. the driver of the vehicle that hit her mother; (b) Serrano also did not identify

The Facts Daluraya as the driver of the said vehicle; (c) Dr. Ortiz merely testified on the autopsy
results; and (d) PSI Gomez, while he did investigate the incident, likewise declared
On January 4, 2006, Daluraya was charged in an Information for Reckless that he did not witness the same.
Imprudence Resulting in Homicide in connection with the death of Marina Oliva.
Records reveal that sometime in the afternoon of January 3, 2006, Marina Oliva was Marla moved for reconsideration, which the MeTC denied in an Order dated
crossing the street when a Nissan Vanette, bearing plate number UPN-172 and November 4, 2010, clarifying that the grant of Daluraya’s demurrer had the effect of
traversing EDSA near the Quezon Avenue flyover in Quezon City, ran her over. an acquittal and that reconsideration of its Order granting Daluraya’s demurrer would
While Marina Oliva was rushed to the hospital to receive medical attention, she violate the latter’s right against double jeopardy. With respect to the civil aspect of
eventually died, prompting her daughter, herein respondent Marla Oliva (Marla), to the case, the MeTC likewise denied the same, holding that no civil liability can be
awarded absent any evidence proving that Daluraya was the person responsible for the subject vehicle was registered in the name of Daluraya’s aunt, Gloria Zilmar, who
Marina Oliva’s demise. authorized him to claim the vehicle from the MeTC.

Aggrieved, Marla appealed to the Regional Trial Court of Quezon City, Branch 76 Daluraya filed a motion for reconsideration, which the CA denied in a Resolution
(RTC), insisting that the MeTC failed to make any finding as to the civil liability of dated November 22, 2013, hence, this petition.
Daluraya, which finding was not precluded by the dismissal of the criminal aspect of
the case. The Issue Before the Court

The RTC Ruling The sole issue advanced for the Court’s resolution is whether or not the CA was
correct in finding Daluraya civilly liable for Marina Oliva’s death despite his acquittal
In a Decision dated September 8, 2011, the RTC dismissed the appeal and affirmed in the criminal case for Reckless Imprudence Resulting in Homicide on the ground of
the MeTC’s ruling, declaring that "the act from which the criminal responsibility may insufficiency of evidence.
spring did not at all exist."
The Court’s Ruling
Marla filed a motion for reconsideration which, although filed beyond the
reglementary period, was nonetheless accepted. However, the RTC found the same The petition is meritorious.
without merit and thus, sustained the factual findings and rulings of the MeTC in its
Order dated May 10, 2012. Dissatisfied, Marla elevated the case to the CA via Every person criminally liable for a felony is also civilly liable. The acquittal of an
petition for review, maintaining that Daluraya must be held civilly liable. accused of the crime charged, however, does not necessarily extinguish his civil
liability. In Manantan v. CA, the Court expounded on the two kinds of acquittal
The CA Ruling recognized by our law and their concomitant effects on the civil liability of the
accused, as follows:
In a Decision dated June 28, 2013, the CA granted the petition and reversed the RTC
Decision, ordering Daluraya to pay Marla the amounts of ₱152,547.00 as actual Our law recognizes two kinds of acquittal, with different effects on the civil liability
damages, ₱50,000.00 as civil indemnity, and ₱50,000.00 as moral damages. In so of the accused. First is an acquittal on the ground that the accused is not the author of
ruling, the CA held that the MeTC’s Order showed that Daluraya’s acquittal was the actor omission complained of. This instance closes the door to civil liability, for a
based on the fact that the prosecution failed to prove his guilt beyond reasonable person who has been found to be not the perpetrator of any act or omission cannot
doubt. As such, Daluraya was not exonerated from civil liability. and can never be held liable for such act or omission. There being no delict, civil
liability ex delicto is out of the question, and the civil action, if any, which may be
Moreover, the CA considered the following pieces of evidence to support its finding instituted must be based on grounds other than the delict complained of. This is the
that Daluraya must be held civilly liable: (a) the inadmissible sworn statement situation contemplated in Rule 111 of the Rules of Court. The second instance is an
executed by Daluraya where he admitted that he drove the subject vehicle which hit acquittal based on reasonable doubt on the guilt of the accused. In this case, even if
Marina Oliva; (b) the conclusion derived from Serrano’s testimony that the woman he the guilt of the accused has not been satisfactorily established, he is not exempt from
saw crossing the street who was hit by a Nissan Vanette with plate number UPN-172, civil liability which may be proved by preponderance of evidence only.
and the victim who eventually died, are one and the same; (c) the Philippine National
Police Referral Letter of one Police Chief Inspector Virgilio Pereda identifying In Dayap v. Sendiong, the Court explained further:
Daluraya as the suspect in the case of Reckless Imprudence Resulting in Homicide
involving the death of Marina Oliva, and stating that he brought the victim to the The acquittal of the accused does not automatically preclude a judgment against him
Quezon City General Hospital for treatment but was declared dead on arrival; and (d) on the civil aspect of the case. The extinction of the penal action does not carry with it
the extinction of the civil liability where: (a) the acquittal is based on reasonable Marina Oliva" and that "there is no competent evidence on hand which proves that
doubt as only preponderance of evidence is required; (b) the court declares that the the accused was the person responsible for the death of Marina Oliva."
liability of the accused is only civil; and (c) the civil liability of the accused does not
arise from or is not based upon the crime of which the accused is acquitted. However, Clearly, therefore, the CA erred in construing the findings of the MeTC, as affirmed
the civil action based on delict may be deemed extinguished if there is a finding on by the RTC, that Daluraya’s acquittal was anchored on reasonable doubt, which
the final judgment in the criminal action that the act or omission from which the civil would necessarily call for a remand of the case to the court a quo for the reception of
liability may arise did not exist or where the accused did not commit the acts or Daluraya’s evidence on the civil aspect. Records disclose that Daluraya’s acquittal
omission imputed to him. was based on the fact that "the act or omission from which the civil liability may arise
did not exist" in view of the failure of the prosecution to sufficiently establish that he
Thus, if demurrer is granted and the accused is acquitted by the court, the accused has was the author of the crime ascribed against him. Consequently, his civil liability
the right to adduce evidence on the civil aspect of the case unless the court also should be deemed as non-existent by the nature of such acquittal.
declares that the act or omission from which the civil liability may arise did not exist.
This is because when the accused files a demurrer to evidence, he has not yet adduced WHEREFORE, the petition is GRANTED. The Decision dated June 28, 2013 and the
evidence both on the criminal and civil aspects of the case. The only evidence on Resolution dated November 22, 2013 of the Court of Appeals in CA-G.R. SP No.
record is the evidence for the prosecution. What the trial court should do is issue an 125113 are hereby REVERSED and SET ASIDE. The Decision dated September
order or partial judgment granting the demurrer to evidence and acquitting the 8,2011 and the Order dated May 10, 2012 of the Regional Trial Court of Quezon
accused, and set the case for continuation of trial for the accused to adduce evidence City, Branch 76 are REINSTATED.
on the civil aspect of the case and for the private complainant to adduce evidence by
way of rebuttal. Thereafter, the court shall render judgment on the civil aspect of the SO ORDERED.
case.

(Emphases supplied) G.R. No. 207949 July 23, 2014

In case of an acquittal, the Rules of Court requires that the judgment state "whether
the evidence of the prosecution absolutely failed to prove the guilt of the accused or PEOPLE OF THE PHILIPPINES, Plaintiff-Appellee,
merely failed to prove his guilt beyond reasonable doubt. In either case, the judgment vs.
shall determine if the act or omission from which the civil liability might arise did not ARMANDO DIONALDO y EBRON, RENATO
exist."
DIONALDO y EBRON, MARIANO GARIGUEZ, JR. y
A punctilious examination of the MeTC’s Order, which the RTC sustained, will show RAMOS, and RODOLFO LARIDO y EBRON, Accused-
that Daluraya’s acquittal was based on the conclusion that the act or omission from Appellants.
which the civil liability may arise did not exist, given that the prosecution was not
able to establish that he was the author of the crime imputed against him. Such
conclusion is clear and categorical when the MeTC declared that "the testimonies of RESOLUTION
the prosecution witnesses are wanting in material details and they did not sufficiently
establish that the accused precisely committed the crime charged against him."37
Furthermore, when Marla sought reconsideration of the MeTC’s Order acquitting PERLAS-BERNABE, J.:
Daluraya, said court reiterated and firmly clarified that "the prosecution was not able
to establish that the accused was the driver of the Nissan Vanette which bumped
Before the Court is an appeal assailing the Decision dated February 15, 2013 of the (PO3 Acebuche) of the Camp Crame Police Anti-Crime Emergency Response
Court of Appeals (CA) in CA-G.R. CR-H.C. No. 02888 finding accused-appellants (PACER). During the course of the investigation, Rodolfo, an employee at the Health
Armando Dionaldo y Ebron (Armando), Renato Dionaldo y Ebron (Renato), Mariano Is Wealth Gym, confessed to PO3 Acebuche that he was part of the plan to kidnap
Gariguez, Jr. y Ramos (Mariano), and Rodolfo Larido y Ebron (Rodolfo) guilty Edwin, as in fact he was the one who tipped off Mariano, Renato, Armando and a
beyond reasonable doubt of the crime of Kidnapping and Serious Illegal Detention. certain Virgilio Varona (Virgilio) on the condition that he will be given a share in the
ransom money. Rodolfo gave information on the whereabouts of his cohorts, leading
The Facts to their arrest on June 12, 2003. In the early morning of the following day or on June
13, 2003, the PACER team found the dead body of Edwin at Sitio Pugpugan Laurel,
At around 8 o'clock in the morning of May 16, 2003, Roderick Navarro (Roderick) Batangas, which Roderick identified.
dropped his brother Edwin Navarro (Edwin) off at the Health Is Wealth Gym in
Caloocan City. Thirty minutes later, he received a text message from another brother Thus, accused-appellants as well as Virgilio were charged in an Information which
who told him that Edwin had been kidnapped. Records show that three (3) men, later reads:
identified as Armando, Renato, and Mariano, forcibly dragged a bloodied Edwin
down the stairway of the gym and pushed him inside a dark green Toyota car with That on or about the 16th day of May, 2003 in Caloocan City, Metro Manila and
plate number UKF 194. Upon receiving the message, Roderick immediately reported within the jurisdiction of this Honorable Court, the above-named accused, conspiring
the incident to the police. At around 10 o’clock in the morning of the same day, he together and mutually helping one another, being then private persons, did then and
received a phone call from Edwin‟s kidnappers who threatened to kill Edwin if he there by force and intimidation willfully, unlawfully and feloniously with the use of
should report the matter to the police. motor vehicle and superior strength take, carry and deprive EDWIN NAVARRO Y
ONA, of his liberty against his will, for the purpose of extorting ransom as in fact a
The following day, Roderick received another call from the kidnappers, who demand of ₱15,000,000.00 was made as a condition of the victim’s release and on the
demanded the payment of ransom money in the amount of ₱15,000,000.00. Roderick occasion thereof, the death of the victim resulted.
told them he had no such money, as he only had ₱50,000.00. On May 19, 2003, after
negotiations over the telephone, the kidnappers agreed to release Edwin in exchange Contrary to law.
for the amount of ₱110,000.00. Roderick was then instructed to bring the money to
Batangas and wait for their next call. During arraignment, accused-appellants pleaded not guilty and interposed the
defenses of denial and alibi. Except for Rodolfo, they individually claimed that on
At around 7:30 in the evening of the same day, as Roderick was on his way to said date and time, they were in their respective houses when they were taken by men
Batangas to deliver the ransom money, the kidnappers called and instructed him to in police uniforms, then subsequently brought to Camp Crame, and there allegedly
open all the windows of the car he was driving and to turn on the hazard light when tortured and detained. On the other hand, Rodolfo, for himself, averred that at around
he reaches the designated place. After a while, Roderick received another call 8 o’clock in the evening of June 12, 2003, while walking on his way home, he noticed
directing him to exit in Bicutan instead and proceed to C-5 until he arrives at the that a van had been following him. Suddenly, four (4) persons alighted from the
Centennial Village. He was told to park beside the Libingan ng mga Bayani. After vehicle, boarded him inside, blindfolded him, and eventually tortured him. He
several hours, an orange Mitsubishi car with plate number DEH 498 pulled up in likewise claimed that he was made to sign an extrajudicial confession, purporting too
front of his vehicle where four (4) men alighted. Roderick saw one of the men take a that while a certain Atty. Nepomuceno had been summoned to assist him, the latter
mobile phone and upon uttering the word "alat," the men returned to their car and failed to do so.
drove away.
During trial, the death of the victim, Edwin, was established through a Certificate of
Meanwhile, a team had been organized to investigate the kidnapping of Edwin, Death with Registry No. 2003-050 (subject certificate of death) showing that he died
headed by SPO3 Romeo Caballero (SPO3 Caballero) and PO3 Nestor Acebuche on May 19, 2003 from a gunshot wound on the head.
 emanated from the same purpose or common design, and they were united in its
The RTC Ruling execution.23

In a Decision dated June 13, 2007, the Regional Trial Court of Caloocan City, Branch Separately, the CA found that accused-appellants’ claims of torture were never
129 (RTC), in Crim. Case No. C-68329, convicted accused-appellants of the crime of supported, and that Rodolfo voluntarily signed the extrajudicial confession and was
Kidnapping and Serious Illegal Detention, sentencing each of them to suffer the afforded competent and independent counsel in its execution.24
penalty of reclusion perpetua.
Aggrieved by their conviction, accused-appellants filed the instant appeal.
It gave credence to the positive and straightforward testimonies of the prosecution
witnesses which clearly established that it was the accused-appellants who forcibly The Issue Before the Court
dragged a bloodied Edwin into a car and, consequently, deprived him of his liberty. In
light thereof, it rejected accused-appellants‟ respective alibis and claims of torture, The sole issue to be resolved by the Court is whether or not accusedappellants are
which were not substantiated. It also held that the crime of Kidnapping had been guilty of the crime of Kidnapping and Serious Illegal Detention.
committed for the purpose of extorting ransom, which is punishable by death.
However, in view of the suspended imposition of the death penalty pursuant to The Court’s Ruling
Republic Act No. (RA) 9346, only the penalty of reclusion perpetua was imposed.
Further, the RTC found that conspiracy attended the commission of the crime, as the The appeal is devoid of merit.
accused-appellants’ individual participation was geared toward a joint purpose and
criminal design. Well-settled is the rule that the question of credibility of witnesses is primarily for the
trial court to determine. Its assessment of the credibility of a witness is entitled to
Notably, while the RTC found that the testimonies of the prosecution witnesses prove great weight, and it is conclusive and binding unless shown to be tainted with
that the victim Edwin was abducted, deprived of liberty, and eventually killed, a fact arbitrariness or unless, through oversight, some fact or circumstance of weight and
which is supported by the subject certificate of death, it did not consider said death in influence has not been considered. Absent any showing that the trial judge
its judgment. The CA Ruling overlooked, misunderstood, or misapplied some facts or circumstances of weight
which would affect the result of the case, or that the judge acted arbitrarily, his
In a Decision dated February 15, 2013, the CA affirmed in toto the RTC’s conviction assessment of the credibility of witnesses deserves high respect by the appellate
of accused-appellants, finding that the prosecution was able to clearly establish all the court.25
elements of the crime of Kidnapping and Serious Illegal Detention, namely: (a) the
offender is a private individual; (b) he kidnaps or detains another, or in any manner In this case, the RTC, as affirmed by the CA, gave weight and credence to the
deprives the latter of his liberty; (c) the act of detention or kidnapping must be illegal; testimonies of the prosecution witnesses, which they found to be straightforward and
and (d) in the commission of the offense, any of the following circumstances is consistent. Through these testimonies, it was clearly established that accused-
present: (1) the kidnapping or detention lasts for more than three days; (2) it is appellants, who were all private individuals, took the victim Edwin and deprived him
committed simulating public authority; (3) any serious physical injuries are inflicted of his liberty, which acts were illegal, and for the purpose of extorting ransom.26
upon the person kidnapped or detained or threats to kill him are made; or (4) the Thus, seeing no semblance of arbitrariness or misapprehension on the part of the
person kidnapped or detained is a minor, except when the accused is any of the court a quo, the Court finds no compelling reason to disturb its factual findings on
parents, female or a public officer.21 It likewise sustained the finding that the this score.1âwphi1
kidnapping was committed for the purpose of extorting ransom, as sufficiently proven
by the testimony of the brother of the victim.22 Moreover, the CA affirmed that Anent the finding that conspiracy attended the commission of the crime, the Court
conspiracy attended the commission of the crime, as the acts of accused-appellants likewise finds the conclusion of the RTC in this regard, as affirmed by the CA, to be
well-taken. Conspiracy exists when two or more persons come to an agreement 4. If the person kidnapped or detained shall be a minor, except when the accused is
concerning the commission of a felony and decide to commit it, and when conspiracy any of the parents, female or a public officer;
is established, the responsibility of the conspirators is collective, not individual,
rendering all of them equally liable regardless of the extent of their respective The penalty shall be death where the kidnapping or detention was committed for the
participations.27 In this relation, direct proof is not essential to establish conspiracy, purpose of extorting ransom from the victim or any other person, even if none of the
as it can be presumed from and proven by the acts of the accused pointing to a joint circumstances above-mentioned were present in the commission of the offense.
purpose, design, concerted action, and community of interests.28 Hence, as the
factual circumstances in this case clearly show that accused-appellants acted in When the victim is killed or dies as a consequence of the detention or is raped, or is
concert at the time of the commission of the crime and that their acts emanated from subjected to torture or dehumanizing acts, the maximum penalty shall be imposed.
the same purpose or common design, showing unity in its execution,29 the CA, (Emphases supplied)
affirming the trial court, correctly ruled that there was conspiracy among them.
The Court further elucidated in People v. Mercado:32
The foregoing notwithstanding, the Court is, however, constrained to modify the
ruling of the RTC and the CA, as the crime the accusedappellants have committed In People v. Ramos, the accused was found guilty of two separate heinous crimes of
does not, as the records obviously bear, merely constitute Kidnapping and Serious kidnapping for ransom and murder committed on July 13, 1994 and sentenced to
Illegal Detention, but that of the special complex crime of Kidnapping for Ransom death. On appeal, this Court modified the ruling and found the accused guilty of the
with Homicide. This is in view of the victim’s (i.e., Edwin’s) death, which was (a) "special complex crime" of kidnapping for ransom with murder under the last
specifically charged in the Information,30 and (b) clearly established during the trial paragraph of Article 267, as amended by Republic Act No. 7659. This Court said:
of this case. Notably, while this matter was not among the issues raised before the
Court, the same should nonetheless be considered in accordance with the settled rule x x x This amendment introduced in our criminal statutes the concept of „special
that in a criminal case, an appeal, as in this case, throws open the entire case wide complex crime‟ of kidnapping with murder or homicide. It effectively eliminated the
open for review, and the appellate court can correct errors, though unassigned, that distinction drawn by the courts between those cases where the killing of the
may be found in the appealed judgment.31 kidnapped victim was purposely sought by the accused, and those where the killing of
the victim was not deliberately resorted to but was merely an afterthought.
After the amendment of the Revised Penal Code on December 31, 1993 by RA 7659, Consequently, the rule now is: Where the person kidnapped is killed in the course of
Article 267 of the same Code now provides: the detention, regardless of whether the killing was purposely sought or was merely
an afterthought, the kidnapping and murder or homicide can no longer be complexed
Art. 267. Kidnapping and serious illegal detention. – Any private individual who shall under Art. 48, nor be treated as separate crimes, but shall be punished as a special
kidnap or detain another, or in any other manner deprive him of his liberty, shall complex crime under the last paragraph of Art. 267, as amended by RA No. 7659.33
suffer the penalty of reclusion perpetua to death: (Emphases supplied; citations omitted)

1. If the kidnapping or detention shall have lasted more than three days. Thus, further taking into account the fact that the kidnapping was committed for the
purpose of extorting ransom, accused-appellants’ conviction must be modified from
2. If it shall have been committed simulating public authority. Kidnapping and Serious Illegal Detention to the special complex crime of Kidnapping
for Ransom with Homicide, which carries the penalty of death. As earlier intimated,
3. If any serious physical injuries shall have been inflicted upon the person kidnapped the enactment of RA 9346 had suspended the imposition of the death penalty. This
or detained; or if threats to kill him shall have been made. means that the accused-appellants could, as the CA and trial court properly ruled,
only be sentenced to the penalty of reclusion perpetua. To this, the Court adds that the
accused-appellants are not eligible for parole.34
 Navarro the following amounts: (1) ₱100,000.00 as civil indemnity; (2) ₱100,000.00
On a final note, the Court observes that the RTC and the CA failed to award civil as moral damages; and (3) ₱100,000.00 as exemplary damages, all with interest at the
indemnity as well as damages to the family of the kidnap victim. In People v. rate of six percent (6%) per annum ·from the date of finality of judgment until fully
Quiachon,35 the Court explained that even if the death penalty was not to be imposed paid.
on accused-appellants in view of the prohibition in RA 9346, the award of civil
indemnity was nonetheless proper, not being dependent on the actual imposition of SO ORDERED.
the death penalty but on the fact that qualifying circumstances warranting the
imposition of the death penalty attended the commission of the crime.36 In the G.R. No. 189081, August 10, 2016
present case, considering that both the qualifying circumstances of ransom and the
death of the victim during captivity were duly alleged in the information and proven GLORIA S. DY, Petitioner, v. PEOPLE OF THE PHILIPPINES, MANDY
during trial, civil indemnity in the amount of ₱100,000.00 must therefore be awarded COMMODITIES CO., INC., REPRESENTED BY ITS PRESIDENT, WILLIAM
to the family of the victim, to conform with prevailing jurisprudence.37 MANDY, Respondent.

Similarly, the Court finds that the award of moral damages is warranted in this case. DECISION
Under Article 2217 of the Civil Code, moral damages include physical suffering,
mental anguish, fright, serious anxiety, wounded feelings, moral shock and similar JARDELEZA, J.:
injury, while Article 2219 of the same Code provides that moral damages may be
recovered in cases of illegal detention. It cannot be denied, in this case, that the Our law states that every person criminally liable for a felony is also civilly liable.
kidnap victim‟s family suffered mental anguish, fright, and serious anxiety over the This civil liability ex delicto may be recovered through a civil action which, under
detention and eventually, the death of Edwin. As such, and in accordance with our Rules of Court, is deemed instituted with the criminal action. While they are
prevailing jurisprudence,38 moral damages in the amount of ₱100,000.00 must actions mandatorily fused,1 they are, in truth, separate actions whose existences are
perforce be awarded to the family of the victim. not dependent on each other. Thus, civil liability ex delicto survives an acquittal in a
criminal case for failure to prove guilt beyond reasonable doubt. However, the Rules
Finally, exemplary damages must be awarded in this case, in view of the confluence of Court limits this mandatory fusion to a civil action for the recovery of civil liability
of the aforesaid qualifying circumstances and in order to deter others from ex delicto. It, by no means, includes a civil liability arising from a different source of
committing the same atrocious acts. In accordance with prevailing jurisprudence,39 obligation, as in the case of a contract. Where the civil liability is ex contractu, the
therefore, the Court awards exemplary damages in the amount of ₱100,000.00 to the court hearing the criminal case has no authority to award damages.
family of the kidnap victim.

In addition, interest at the rate of six percent (6%) per annum shall be imposed on all The Case
damages awarded from the date of finality of judgment until fully paid, pursuant to
prevailing jurisprudence.40 This is a Petition for Review on Certiorari under Rule 45 of the Rules of Court.
Petitioner Gloria S. Dy (petitioner) seeks the reversal of the decision of the Court of
WHEREFORE, the appeal is DISMISSED. The Decision dated February 15, 2013 of Appeals (CA) dated February 25, 2009 (Assailed Decision)2 ordering her to pay
the Court of Appeals in CA-G.R. CR-H.C. No. 02888 is hereby AFFIRMED with the Mandy Commodities Company, Inc. (MCCI) in the amount of
MODIFICATION that all the accusedappellants herein are equally found GUILTY of P21,706,281.00.3chanrobleslaw
the special complex crime of Kidnapping for Ransom with Homicide, and are
sentenced to each suffer the penalty of reclusion perpetua, without eligibility for The Facts
parole, and to pay, jointly and severally, the family of the kidnap victim Edwin
Petitioner was the former General Manager of MCCL. In the course of her Petitioner would then pay ICBC using her own checks. The trial court further made a
employment, petitioner assisted MCCI in its business involving several properties. finding that Mandy and petitioner entered into a contract of loan.13 Thus, it held that
One such business pertained to the construction of warehouses over a property the prosecution failed to establish an important element of the crime of estafa—
(Numancia Property) that MCCI leased from the Philippine National Bank (PNB). misappropriation or conversion. However, while the RTC Manila acquitted petitioner,
Sometime in May 1996, in pursuit of MCCI's business, petitioner proposed to it ordered her to pay the amount of the checks. The dispositive portion of the RTC
William Mandy (Mandy), President of MCCI, the purchase of a property owned by Decision states —
Pantranco. As the transaction involved a large amount of money, Mandy agreed to WHEREFORE, the prosecution having failed to establish the guilt of the accused
obtain a loan from the International China Bank of Commerce (ICBC). Petitioner beyond reasonable doubt, judgment is hereby rendered ACQUITTING the accused of
represented that she could facilitate the approval of the loan. True enough, ICBC the offense charged. With costs de officio.
granted a loan to MCCI in the amount of P20,000,000.00, evidenced by a promissory
note. As security, MCCI also executed a chattel mortgage over the warehouses in the The accused is however civilly liable to the complainant for the amount of
Numancia Property. Mandy entrusted petitioner with the obligation to manage the P21,706,281.00.
payment of the loan.4chanrobleslaw
SO ORDERED.14chanroblesvirtuallawlibrary
In February 1999, MCCI received a notice of foreclosure over the mortgaged Petitioner filed an appeal15 of the civil aspect of the RTC Decision with the CA. In
property due to its default in paying the loan obligation.5 In order to prevent the the Assailed Decision,16 the CA found the appeal without merit. It held that the
foreclosure, Mandy instructed petitioner to facilitate the payment of the loan. MCCI, acquittal of petitioner does not necessarily absolve her of civil liability. The CA said
through Mandy, issued 13 Allied Bank checks and 12 Asia Trust Bank checks in that it is settled that when an accused is acquitted on the basis of reasonable doubt,
varying amounts and in different dates covering the period from May 18, 1999 to courts may still find him or her civilly liable if the evidence so warrant. The CA
April 4, 2000.6 The total amount of the checks, which were all payable to cash, was explained that the evidence on record adequately prove that petitioner received the
P21,706,281.00. Mandy delivered the checks to petitioner. Mandy claims that he checks as a loan from MCCI. Thus, preventing the latter from recovering the amount
delivered the checks with the instruction that petitioner use the checks to pay the of the checks would constitute unjust enrichment. Hence, the Assailed Decision ruled
loan.7 Petitioner, on the other hand, testified that she encashed the checks and WHEREFORE, in view of the foregoing, the appeal is DENIED. The Decision dated
returned the money to Mandy.8 ICBC eventually foreclosed the mortgaged property November 11, 2005 of the Regional Trial Court, Manila, Branch 33 in Criminal Case
as MCCI continued to default in its obligation to pay. Mandy claims that it was only No. 04-224294 which found Gloria Dy civilly liable to William Mandy is
at this point in time that he discovered that not a check was paid to AFFIRMED.
ICBC.9chanrobleslaw
SO ORDERED.17chanroblesvirtuallawlibrary
Thus, on October 7, 2002, MCCI, represented by Mandy, filed a Compiamt-Affidavit The CA also denied petitioner's motion for reconsideration in a resolution18 dated
for Estafa10 before the Office of the City Prosecutor of Manila. On March 3, 2004, an August 3, 2009.
Information11 was filed against petitioner before the Regional Trial Court (RTC)
Manila. Hence, this Petition for Review on Certiorari (Petition). Petitioner argues that since
she was acquitted for failure of the prosecution to prove all the elements of the crime
After a full-blown trial, the RTC Manila rendered a decision12 dated November 11, charged, there was therefore no crime committed.19 As there was no crime, any civil
2005 (RTC Decision) acquitting petitioner. The RTC Manila found that while liability ex delicto cannot be awarded.
petitioner admitted that she received the checks, the prosecution failed to establish
that she was under any obligation to deliver them to ICBC in payment of MCCFs The Issues
loan. The trial court made this finding on the strength of Mandy's admission that he
gave the checks to petitioner with the agreement that she would encash them.
The central issue is the propriety of making a finding of civil liability in a criminal The law and the rules of procedure provide for a precise mechanism in instituting a
case for estafa when the accused is acquitted for failure of the prosecution to prove all civil action pertaining to an act or omission which is also subject of a criminal case.
the elements of the crime charged. Our Rules of Court prescribes a kind of fusion such that, subject to certain defined
qualifications, when a criminal action is instituted, the civil action for the recovery of
The Ruling of the Court the civil liability arising from the offense is deemed instituted as
well.25cralawredchanrobleslaw
We grant the petition.
However, there is an important difference between civil and criminal proceedings that
Civil Liability Arising From Crime require a fine distinction as to how these twin actions shall proceed. These two
proceedings involve two different standards of proof. A criminal action requires proof
Our laws recognize a bright line distinction between criminal and civil liabilities. A of guilt beyond reasonable doubt while a civil action requires a lesser quantum of
crime is a liability against the state. It is prosecuted by and for the state. Acts proof, that of preponderance of evidence. This distinction also agrees with the
considered criminal are penalized by law as a means to protect the society from essential principle in our legal system that while a criminal liability carries with it a
dangerous transgressions. As criminal liability involves a penalty affecting a person's corresponding civil liability, they are nevertheless separate and distinct. In other
liberty, acts are only treated criminal when the law clearly says so. On the other hand, words, these two liabilities may co-exist but their existence is not dependent on each
civil liabilities take a less public and more private nature. Civil liabilities are claimed other.26chanrobleslaw
through civil actions as a means to enforce or protect a right or prevent or redress a
wrong.20 They do not carry with them the imposition of imprisonment as a penalty. The Civil Code states that when an accused in a criminal prosecution is acquitted on
Instead, civil liabilities are compensated in the form of damages. the ground that his guilt has not been proven beyond reasonable doubt, a civil action
for damages for the same act or omission may be filed. In the latter case, only
Nevertheless, our jurisdiction recognizes that a crime has a private civil component. preponderance of evidence is required.27 This is supported by the Rules of Court
Thus, while an act considered criminal is a breach of law against the State, our legal which provides that the extinction of the criminal action does not result in the
system allows for the recovery of civil damages where there is a private person extinction of the corresponding civil action.28 The latter may only be extinguished
injured by a criminal act. It is in recognition of this dual nature of a criminal act that when there is a "finding in a final judgment in the criminal action that the act or
our Revised Penal Code provides that every person criminally liable is also civilly omission from which the civil liability may arise did not exist."29 Consistent with
liable.21 This is the concept of civil liability ex delicto. this, the Rules of Court requires that in judgments of acquittal the court must state
whether "the evidence of the prosecution absolutely failed to prove the guilt of the
This is echoed by the New Civil Code when it recognizes acts or omissions punished accused or merely failed to prove his guilt beyond reasonable doubt. In either case,
by law as a separate source of obligation.22 This is reinforced by Article 30 of the the judgment shall determine if the act or omission from which the civil liability
same code which refers to the filing of a separate civil action to demand civil liability might arise did not exist."30chanrobleslaw
arising from a criminal offense.23chanrobleslaw
Thus, whether an exoneration from the criminal action should affect the
The Revised Penal Code fleshes out this civil liability in Article 10424 which states corresponding civil action depends on the varying kinds of acquittal. In Manantan v.
that it includes restitution, reparation of damage caused and indemnification for Court of Appeals,31 we explained —
consequential damages. 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
Rules of procedure for criminal and civil actions involving the same act or omission 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. There being no delict civil
liability ex delicto is out of the question, and the civil action, if any, which may be Civil Liability Ex Delicto in Estafa Cases
instituted must be based on grounds other than the delict complained of. This is the
situation contemplated in Rule 111 of the Rules of Court. The second instance is an Our laws penalize criminal fraud which causes damage capable of pecuniary
acquittal based on reasonable doubt on the guilt of the accused. In this case, even if estimation through estafa under Article 315 of the Revised Penal Code. In general,
the guilt of the accused has not been satisfactorily established, he is not exempt from the elements of estafa are:ChanRoblesVirtualawlibrary
civil liability which may be proved by preponderance of evidence only. This is the (1)
situation contemplated in Article 29 of the Civil Code, where the civil action for That the accused defrauded another (a) by abuse of confidence, or (b) by means of
damages is "for the same act or omission." Although the two actions have different deceit; and
purposes, the matters discussed in the civil case are similar to those discussed in the (2)
criminal case. However, the judgment In the criminal proceeding cannot be read in That damage or prejudice capable of pecuniary estimation is caused to the offended
evidence In the civil action to establish any fact there determined, even though both party or third person.
actions involve the same act or omission. The reason for this rule is that the parties The essence of the crime is the unlawful abuse of confidence or deceit in order to
are not the same and secondarily, different rules of evidence are applicable. Hence, cause damage. As this Court previously held, "the element of fraud or bad faith is
notwithstanding herein petitioner's acquittal, the Court of Appeals in determining indispensable."35 Our law abhors the act of defrauding another person by abusing his
whether Article 29 applied, was not precluded from looking into the question of trust or deceiving him, such that, it criminalizes this kind of fraud.
petitioner's negligence or reckless imprudence.32chanroblesvirtuallawlibrary
In Dayap v. Sendiong,33 we further said — Article 315 of the Revised Penal Code identifies the circumstances which constitute
The acquittal of the accused does not automatically preclude a judgment against him estafa. Article 315, paragraph 1 (b) states that estafa is committed by abuse of
on the civil aspect of the case. The extinction of the penal action does not carry with it confidence —
the extinction of the civil liability where: (a) the acquittal is based on reasonable Art. 315. Swindling (estafa) - x x x (b) By misappropriating or converting, to the
doubt as only preponderance of evidence is required; (b) the court declares that the prejudice of another, money, goods, or any other personal property received by the
liability of the accused is only civil; and (c) the civil liability of the accused does not offender in trust or on commission, or for administration, or under any other
arise from or is not based upon the crime of which the accused is acquitted. However, obligation involving the duty to make delivery of or to return the same, even though
the civil action based on delict may be deemed extinguished if mere is a finding on such obligation be totally or partially guaranteed by a bond; or by denying having
the final judgment in the criminal action that the act or omission from which the civil received such money, goods, or other property.
liability may arise did not exist or where the accused did not commit the acts or In this kind of estafa, the fraud which the law considers as criminal is the act of
omission imputed to him.34chanroblesvirtuallawlibrary misappropriation or conversion. When the element of misappropriation or conversion
Hence, a civil action filed for the purpose of enforcing civil liability ex delicto, even is missing, there can be no estafa. In such case, applying the foregoing discussions on
if mandatorily instituted with the corresponding criminal action, survives an acquittal civil liability ex delicto, there can be no civil liability as there is no act or omission
when it is based on the presence of reasonable doubt. In these instances, while the from which any civil liability may be sourced. However, when an accused is
evidence presented does not establish the fact of the crime with moral certainty, the acquitted because a reasonable doubt exists as to the existence of misappropriation or
civil action still prevails for as long as the greater weight of evidence tilts in favor of conversion, then civil liability may still be awarded. This means that, while there is
a finding of liability. This means that while the mind of the court cannot rest easy in evidence to prove fraud, such evidence does not suffice to convince the court to the
penalizing the accused for the commission of a crime, it nevertheless finds that he or point of moral certainty that the act of fraud amounts to estafa. As the act was
she committed or omitted to perform acts which serve as a separate source of nevertheless proven, albeit without sufficient proof justifying the imposition of any
obligation. There is no sufficient proof that the act or omission is criminal beyond criminal penalty, civil liability exists.
reasonable doubt, but there is a preponderance of evidence to show that the act or
omission caused injury which demands compensation. In this case, the RTC Manila acquitted petitioner because the prosecution failed to
establish by sufficient evidence the element of misappropriation or conversion. There
was no adequate evidence to prove that Mandy gave the checks to petitioner with the of guilt"43 considering the above finding. The dispositive portion stated that Singson
instruction that she will use them to pay the ICBC loan. Citing Mandy's own is acquitted "without prejudice to any civil liability which may be established in a
testimony in open court, the RTC Manila held that when Mandy delivered the checks civil case against her."44chanrobleslaw
to petitioner, their agreement was that it was a "sort of loan."36 In the dispositive
portion of the RTC Decision, the RTC Manila ruled that the prosecution "failed to However, our jurisprudence on the matter appears to have changed in later years.
establish the guilt of the accused beyond reasonable doubt."37 It then proceeded to
order petitioner to pay the amount of the loan. In Eusebio-Calderon v. People,45 this Court affirmed the finding of the CA that
Calderon "did not employ trickery or deceit in obtaining money from the private
The ruling of the RTC Manila was affirmed by the CA. It said that "[t]he acquittal of complainants, instead, it concluded that the money obtained was undoubtedly loans
Gloria Dy is anchored on the ground that her guilt was not proved beyond reasonable for which [Calderon] paid interest."46 Thus, this Court upheld Calderon's acquittal of
doubt - not because she is not the author of the act or omission complained of. x x x estafa, but found her civilly liable for the principal amount borrowed from the private
The trial court found no trickery nor deceit in obtaining money from the private complainants.47chanrobleslaw
complainant; instead, it concluded that the money obtained was undoubtedly a
loan."38 The ruling was similar in People v. Cuyugan.48 In that case, we acquitted Cuyugan of
estafa for failure of the prosecution to prove fraud. We held that the transaction
Our jurisprudence on this matter diverges. between Cuyugan and private complainants was a loan to be used by Cuyugan in her
business. Thus, this Court ruled that Cuyugan has the obligation, which is civil in
Earlier cases ordered the dismissal of the civil action for recovery of civil liability ex character, to pay the amount borrowed.49chanrobleslaw
delicto whenever there is a finding that there was no estafa but rather an obligation to
pay under a contract. In People v. Pantig,39 this Court affirmed the ruling of the We hold that the better rule in ascertaining civil liability in estafa cases is that
lower court acquitting Pantig, but revoked the portion sentencing him to pay the pronounced in Pantig and Singson. The rulings in these cases are more in accord with
offended party the amount of money alleged to have been obtained through false and the relevant provisions of the Civil Code, and the Rules of Court. They are also
fraudulent representations, thus — logically consistent with this Court's pronouncement in Manantan.
The trial court found as a fact that the sum of P1,200, ordered to be paid in the
judgment of acquittal, was received by the defendant-appellant as loan. This finding Under Pantig and Singson, whenever the elements of estafa are not established, and
is inconsistent with the existence of the criminal act charged in the information. The that the delivery of any personal property was made pursuant to a contract, any civil
liability of the defendant for the return of the amount so received arises from a civil liability arising from the estafa cannot be awarded in the criminal case. This is
contract, not from a criminal act, and may not be enforced in the criminal case. because the civil liability arising from the contract is not civil liability ex delicto,
which arises from the same act or omission constituting the crime. Civil liability ex
The portion of the judgment appealed from, which orders the defendant-appellant to delicto is the liability sought to be recovered in a civil action deemed instituted with
pay the sum of Pi ,200 to the offended party, is hereby revoked, without prejudice to the criminal case.
the filing of a civil action for the recovery of the said
amount.40chanroblesvirtuallawlibrary The situation envisioned in the foregoing cases, as in this case, is civil liability ex
This was also the import of the ruling in People v. Singson.41 In that case, this Court contractu where the civil liability arises from an entirely different source of
found that "the evidence [was] not sufficient to establish the existence of fraud or obligation. Therefore, it is not the type of civil action deemed instituted in the
deceit on the part of the accused. x x x And when there is no proven deceit or fraud, criminal case, and consequently must be filed separately. This is necessarily so
there is no crime of estafa."42 While we also said that the established facts may prove because whenever the court makes a finding that the elements of estafa do not exist, it
Singson's civil liability (obligation to pay under a contract of sale), we nevertheless effectively says that there is no crime. There is no act or omission that constitutes
made no finding of civil liability because "our mind cannot rest easy on the certainty
criminal fraud. Civil liability ex delicto cannot be awarded as it cannot be sourced instituted in a separate civil case. A civil action for collection of sum of money filed
from something that does not exist. before the proper court will provide for a better venue where the terms of the loan and
other relevant details may be received. While this may postpone a warranted recovery
When the court finds that the source of obligation is in fact, a contract, as in a of the civil liability, this Court deems it more important to uphold the principles
contract of loan, it takes a position completely inconsistent with the presence of underlying the inherent differences in the various sources of obligations under our
estafa. In estafa, a person parts with his money because of abuse of confidence or law, and the rule that fused actions only refer to criminal and civil actions involving
deceit. In a contract, a person willingly binds himself or herself to give something or the same act or omission. These legal tenets play a central role in this legal system. A
to render some service.50 In estafa, the accused's failure to account for the property confusion of these principles will ultimately jeopardize the interests of the parties
received amounts to criminal fraud. In a contract, a party's failure to comply with his involved. Actions focused on proving estafa is not the proper vehicle to thresh out
obligation is only a contractual breach. Thus, any finding that the source of obligation civil liability arising from a contract.52 The Due Process Clause of the Constitution
is a contract negates estafa. The finding, in turn, means that there is no civil liability dictates that a civil liability arising from a contract must be litigated in a separate civil
ex delicto. Thus, the rulings in the foregoing cases are consistent with the concept of action.
fused civil and criminal actions, and the different sources of obligations under our
laws. Section 1 of the Bill of Rights states that no person shall be deprived of property
without due process of law. This provision protects a person's right to both
We apply this doctrine to the facts of this case. Petitioner was acquitted by the RTC substantive and procedural due process. Substantive due process looks into the
Manila because of the absence of the element of misappropriation or conversion. The validity of a law and protects against arbitrariness.53 Procedural due process, on the
RTC Manila, as affirmed by the CA, found that Mandy delivered the checks to other hand, guarantees procedural fairness.54 It requires an ascertainment of "what
petitioner pursuant to a loan agreement. Clearly, there is no crime of estafa. There is process is due, when it is due, and the degree of what is due."55 This aspect of due
no proof of the presence of any act or omission constituting criminal fraud. Thus, process is at the heart of this case.
civil liability ex delicto cannot be awarded because there is no act or omission
punished by law which can serve as the source of obligation. Any civil liability In general terms, procedural due process means the right to notice and hearing.56
arising from the loan takes the nature of a civil liability ex contractu. It does not More specifically, our Rules of Court provides for a set of procedures through which
pertain to the civil action deemed instituted with the criminal case. a person may be notified of the claims against him or her as well as methods through
which he or she may be given the adequate opportunity to be heard.
In Manantan, this Court explained the effects of this result on the civil liability
deemed instituted with the criminal case. At the risk of repetition, Manantan held that The Rules of Court requires that any person invoking the power of the judiciary to
when there is no delict, "civil liability ex delicto is out of the question, and the civil protect or enforce a right or prevent or redress a wrong57 must file an initiatory
action, if any, which may be instituted must be based on grounds other than the delict pleading which embodies a cause of action,58 which is defined as the act or omission
complained of."51 In Dy's case, the civil liability arises out of contract—a different by which a party violates a right of another.59 The contents of an initiatory pleading
source of obligation apart from an act or omission punished by law—and must be alleging a cause of action will vary depending on the source of the obligation
claimed in a separate civil action. involved. In the case of an obligation arising from a contract, as in this case, the cause
of action in an initiatory pleading will involve the duties of the parties to the contract,
Violation of Due Process and what particular obligation was breached. On the other hand, when the obligation
arises from an act or omission constituting a crime, the cause of action must
We further note that the evidence on record never fully established the terms of this necessarily be different. In such a case, the initiatory pleading will assert as a cause of
loan contract. As the trial before the RTC Manila was focused on proving estafa, the action the act or omission of respondent, and the specific criminal statute he or she
loan contract was, as a consequence, only tangentially considered. This provides violated. Where the initiatory pleading fails to state a cause of action, the respondent
another compelling reason why the civil liability arising from the loan should be
may file a motion to dismiss even before trial.60 These rules embody the fundamental
right to notice under the Due Process Clause of the Constitution. Indeed, the language of the Constitution is clear. No person shall be deprived of
property without due process of law. Due Process, in its procedural sense, requires, in
In a situation where a court (in a fused action for the enforcement of criminal and essence, the right to notice and hearing. These rights are further fleshed out in the
civil liability) may validly order an accused-respondent to pay an obligation arising Rules of Court. The Rules of Court enforces procedural due process because, to
from a contract, a person's right to be notified of the complaint, and the right to have repeat the words of this Court in Secretary of Justice v. Lantion, it provides for "what
the complaint dismissed if there is no cause of action, are completely defeated. In this process is due, when it is due, and the degree of what is due."64 A court ordering an
event, the accused-respondent is completely unaware of the nature of the liability accused in a fused action to pay his or her contractual liability deprives him or her of
claimed against him or her at the onset of the case. The accused-respondent will not his or her property without the right to notice and hearing as expressed in the
have read any complaint stating the cause of action of an obligation arising from a procedures and remedies under the Rules of Court. Thus, any court ruling directing an
contract. All throughout the trial, the accused-respondent is made to believe that accused in a fused action to pay civil liability arising from a contract is one that
should there be any civil liability awarded against him or her, this liability is rooted completely disregards the Due Process Clause. This ruling must be reversed and the
from the act or omission constituting the crime. The accused-respondent is also Constitution upheld.
deprived of the remedy of having the complaint dismissed through a motion to
dismiss before trial. In a fused action, the accused-respondent could not have availed Conclusion
of this remedy because he or she was not even given an opportunity to ascertain what
cause of action to look for in the initiatory pleading. In such a case, the accused- The lower courts erred when they ordered petitioner to pay her civil obligation arising
respondent is blindsided. He or she could not even have prepared the appropriate from a contract of loan in the same criminal case where she was acquitted on the
defenses and evidence to protect his or her interest. This is not the concept of fair play ground that there was no crime. Any contractual obligation she may have must be
embodied in the Due Process Clause. It is a clear violation of a person's right to due litigated in a separate civil action involving the contract of loan. We clarify that in
process. cases where the accused is acquitted on the ground that there is no crime, the civil
action deemed instituted with the criminal case cannot prosper precisely because
The Rules of Court also allows a party to a civil action certain remedies that enable there is no delict from which any civil obligation may be sourced. The peculiarity of
him or her to effectively present his or her case. A party may file a cross-claim, a this case is the finding that petitioner, in fact, has an obligation arising from a
counterclaim or a third-party complaint.61 The Rules of Court prohibits these contract. This civil action arising from the contract is not necessarily extinguished. It
remedies in a fused civil and criminal case.62 The Rules of Court requires that any can be instituted in the proper court through the proper civil action.
cross-claim, counterclaim or third-party complaint must be instituted in a separate
civil action.63 In a legal regime where a court may order an accused in a fused action We note that while there is no written contract of loan in this case, there is an oral
to pay civil liability arising from a contract, the accused-respondent is completely contract of loan which must be brought within six years.65 Under the facts of the
deprived of the remedy to file a cross-claim, a counterclaim or a third-party case, it appears that any breach in the obligation to pay the loan may have happened
complaint. This—coupled with an accused-respondent's inability to adequately between 1996 and 1999, or more than six years since this case has been instituted.
prepare his or her defense because of lack of adequate notice of the claims against This notwithstanding, we find that the civil action arising from the contract of loan
him or her—prevents the accused-respondent from having any right to a meaningful has not yet prescribed. Article 1150 of the Civil Code states —
hearing. The right to be heard under the Due Process Clause requires not just any kind Art. 1150. The time for prescription for all kinds of actions, when there is no special
of an opportunity to be heard. It mandates that a party to a case must have the chance provision which ordains otherwise, shall be counted from the day they may be
to be heard in a real and meaningful sense. It does not require a perfunctory hearing, brought.
but a court proceeding where the party may adequately avail of the procedural We held in numerous cases that it is the legal possibility of bringing the action that
remedies granted to him or her. A court decision resulting from this falls short of the determines the starting point for the computation of the period of prescription.67 We
mandate of the Due Process Clause. highlight the unique circumstances surrounding this case. As discussed in this
decision, there has been diverse jurisprudence as to the propriety of ordering an RESOLUTION
accused to pay an obligation arising from a contract in the criminal case where the
accused was acquitted on the ground that there is no crime. Litigants, such as MCCI, LEONARDO-DE CASTRO, J.:
cannot be blamed for relying on prior rulings where the recovery on a contract of loan
in a criminal case for estafa was allowed. We have found the opportunity to clarify In Criminal Case Nos. 1317 and 1318, accused-appellant Ruben Calomia was
this matter through this decision. As it is only now that we delineate the rules ·charged before the Regional Trial Court (RTC) of Loay, Bohol, Branch 50, with two
governing the fusion of criminal and civil actions pertaining to estafa, it is only upon counts of qualified rape of his minor daughter, AAA,1 which he allegedly committed
the promulgation of this judgment that litigants have a clear understanding of the sometime in August 2007 and April 2008.2
proper recourse in similar cases. We therefore rule that insofar as MCCI is concerned,
the filing of an action, if any (that may be sourced from the contract of loan), After trial on the merits, the RTC promulgated its Decision on March 11, 2015
becomes a legal possibility only upon the finality of this decision which definitively finding accused-appellant guilty beyond reasonable doubt of both counts of qualified
ruled upon the principles on fused actions. rape and sentencing him as follows:

We add, however, that upon finality of this decision, prospective litigants should WHEREFORE, in the light of the foregoing evidence, the court finds the accused
become more circumspect in ascertaining their course of action in similar cases. guilty beyond reasonable doubt of (Qualified) Incestuous Rape in Crim. Case No.
Whenever a litigant erroneously pursues an estafa case, and the accused is 1317 and Statutory Incestuous Rape in Crim. Case No. 1318.
subsequently acquitted because the obligation arose out of a contract, the prescriptive
period will still be counted from the time the cause of action arose. In this eventuality, Accordingly, in both cases, the court has no recourse but to impose on the accused the
it is probable that the action has already prescribed by the time the criminal case shall penalties mandated by law. Although the crimes of Qualified Incestuous Rape and
have been completed. This possibility demands that prospective litigants do not Statutory Incestuous Rape would have been punishable by death, in view of the
haphazardly pursue the filing of an estafa case in order to force an obligor to pay his passage of R.A. [No.] 9346 (which prohibits the imposition of the death penalty), the
or her obligation with the threat of criminal conviction. It compels litigants to be penalty imposable for each of the two offenses is only reclusion perpetua.
honest and fair in their judgment as to the proper action to be filed. This ruling should
deter litigants from turning to criminal courts as their collection agents, and should Because of the qualifying or aggravating circumstance of relationship, the victim is
provide a disincentive to the practice of filing of criminal cases based on unfounded entitled to civil indemnity in each case of ₱75,000 ex delicto, ₱75,000 in moral
grounds in order to provide a litigant a bargaining chip in enforcing contracts. damages (People v. Lauga, G.R. No. 186228, Mar. 15, 2010), and ₱30,000 in
exemplary damages (ibid.).3
WHEREFORE, in view of the foregoing, the Petition is GRANTED. The Decision of
the CA dated February 25, 2009 is REVERSED. This is however, without prejudice Accused-appellant's appeal before the Court of Appeals was docketed as CA-G.R.
to any civil action which may be filed to claim civil liability arising from the contract. CEB-CR-HC No. 02040. In its Decision dated August 26, 2016, the appellate court
upheld accused-appellant's conviction, but modified the award of damages to AAA.
SO ORDERED. The Court of Appeals decreed:

G.R. No. 229856 WHEREFORE, in view of the foregoing, We find no error committed by the Trial
Court and, hence, DENY the appeal. The Decision dated 11 March 2015 rendered by
PEOPLE OF THE PHILIPPINES, Plaintiff-appellee the Regional Trial Court of Loay, Bohol 7th Judicial Region, Branch 50, in Criminal
vs. Case Nos. 1317 and 1318, is AFFIRMED with MODIFICATION.
RUBEN CALOMIA, Accused-appellant
As modified, [accused-]appellant Ruben Calomia is ordered to pay the victim AAA Art. 89. How criminal liability is totally extinguished. - Criminal liability is totally
the amounts of ₱l00,000.00 as civil indemnity, ₱l00,000.001 as moral damages, and extinguished:
₱l00,000.00 as exemplary damages. Interest is imposed on all damages awarded at
the rate of 6% per annum from date of finality of this Decision until fully paid.4 1. By the death of the convict, as to the personal penalties; and as to pecuniary
penalties, liability therefore is extinguished only when the death of the offender
On September 21, 2016, accused-appellant filed his Notice of Appeal expressing his occurs before final judgment[.]
intention to appeal the foregoing Decision before this Court.
In People v. Bayotas,6 the Court construed the above provision and pronounced these
The Court issued a Resolution dated April 25, 2017 requiring the parties to file their guidelines:
respective supplemental briefs, if they so desired, within 30 days from notice;
ordering the Provincial Jail Warden, Bohol Detention and Rehabilitation Center, 1. Death of the accused pending appeal of his conviction extinguishes his criminal
Tagbilaran City, to transfer accused-appellant to the Bureau of Corrections, liability as well as the civil liability based solely thereon. As opined by Justice
Muntinlupa City and to submit a report of such transfer; and ordering the Director Regalado, in this regard, "the death of the accused prior to final judgment terminates
General of the Bureau of Corrections to confirm the confinement of accused- his criminal liability and only the civil liability directly arising from and based solely
appellant to said prison and submit a report thereon. on the offense committed, i.e., civil liability ex delicto in senso strictiore."

However, the Court received on September 4, 201 7 a letter dated August 2, 2017 2. Corollarily, the claim for civil liability survives notwithstanding the death of
from Jail Chief Inspector (J/CINSP) Felipe A. Montejo (Montejo), DDM, Bohol accused, if the same may also be predicated on a source of obligation other than
District Jail Warden, stating thus: delict. Article 1157 of the Civil Code enumerates these other sources of obligation
from which the civil liability may arise as a result of the same act or omission:
Please be informed that the said appellant [has] died while in the confinement of
Bohol District Jail last Sept. 29, 2015 due to Asphyxia due to Strangulation, Self a) Law
Inflicted, Hanging and declared dead by Dr. Calvelo, Medical Officer III, City Health
Office, Tagbilaran City, Bohol per Certificate of Death from Local Civil Registrar. b) Contracts

Accused Ruben Calomia was due for transfer at BUCOR Muntinlupa City at that time c) Quasi-contracts
pending the approval of budget but unfortunately he died with the aforementioned
cause of death before the scheduled date and time to transfer.5 d) xxx

Attached to J/CINSP Montejo's letter is a copy of accused-appellant's Death e) Quasi-delicts

Certificate issued by the Office of the Civil Registrar General indicating that accused-
appellant died on September 29, 2015 in Cabawan District, Tagbilaran City, Bohol, of 3. Where the civil liability survives, as explained in Number 2 above, an action for
"Asphyxia due to Strangulation, Self Inflicted, Hanging." recovery therefor may be pursued but only by way of filing a separate civil action and
subject to Section 1, Rule 111 of the 1985 Rules on Criminal Procedure as amended.
Paragraph 1 of Article 89 of the Revised Penal Code, as amended, provides that the This separate civil action may be enforced either against the executor/administrator or
death of an accused pending his appeal extinguishes both his criminal and civil the estate of the accused, depending on the source of obligation upon which the same
liability ex delicto, thus: is based as explained above.
4. Finally, the private offended party need not fear a forfeiture of his right to file this
separate civil action by prescription, in cases where during the prosecution of the LEONEN, J.:
criminal action and prior to its extinction, the private-offended party instituted
together therewith the civil action. In such case, the statute of limitations on the civil An acquittal from a charge of physical violence against women and their children is
liability is deemed interrupted during the pendency of the criminal case, conformably not a bar to the filing of a civil action for damages for physical injuries under Article
with provisions of Article 1155 of the Civil Code, that should thereby avoid any 33 of the Civil Code if an acquittal was due to reasonable doubt, without any
apprehension on a possible privation of right by prescription. (Emphases supplied.) declaration that the facts upon which the offense arises are nonexistent.

The death of an accused pending the appeal of his conviction extinguishes the This resolves the Petition for Review on Certiorari1 filed by Alastair John Kane,
criminal action, as there is no longer a defendant to stand as the accused; and the civil assailing the Decision2 and Resolution3 of the Court of Appeals.
action instituted therein for the recovery of civil liability ex delicto is likewise ipso
facto extinguished, as it is grounded on the criminal action.7 The Court of Appeals reversed and set aside the Order4 of the Regional Trial Court,
Branch 214, Mandaluyong City, dismissing Patricia Roggenkamp's Complaint for
In the instant case, accused-appellant's death occurred prior to the finality of the Damages against Alastair John Kane. The Complaint, which was based on Article 33
judgment of conviction rendered against him.1âwphi1 In fact, accused-appellant died of the Civil Code, was dismissed on the grounds of res judicata and lack of
way back on September 29, 2015, during the pendency of his appeal before the Court jurisdiction.
of Appeals. Unfortunately, the appellate court was not timely inf9rmed of accused-
appellant's death prior to the promulgation of its Decision in CA-G.R. CEB-CR-HC Alastair John Kane (Alastair John) and Patricia Roggenkamp (Patricia) are Australian
No. 02040 on August 26, 2016. citizens.5 They met in January 2004 in Brisbane, Australia, and became lovers
immediately.6
Irrefragably, accused-appellant's death extinguished his criminal liability and his civil
liabilities directly arising from and based solely on the crime/s he committed. Patricia decided to put up a business in the Philippines, and eventually travelled with
Accused-appellant's conviction by the RTC, as affirmed by the Court of Appeals, Alastair John to Manila. They settled in a condominium unit located in Paranaque
must therefore be set aside as the same had already been rendered ineffectual. City supposedly owned by Patricia.7

WHEREFORE, the Court RESOLVES to SET ASIDE the Decision dated August 26, On March 30, 2006, an Information for violation of Republic Act No. 9262 or the
2016 of the Court of Appeals in CA-G.R. CEB-CR-HC No. 02040 and to DISMISS Anti-Violence Against Women and Children Act of 2004 was filed against Alastair
Criminal Case Nos. 131 7 and 1318 before the Regional Trial Court of Loay, Bohol, John, with Patricia as the private complainant. The case, docketed as Criminal Case
Branch 50, by reason of the death of the sole accused therein, Ruben Calomia, on No. 06-0413, was then raffled to Branch 260 of the Regional Trial Court of
September 29, 2015. Paranaque City.8

SO ORDERED. According to Patricia, she and Alastair John attended a party hosted by her son,
Ashley Richard Cayzer (Ashley Richard) on November 30, 2004. The next day,
[ G.R. No. 214326, July 06, 2020 ] December 1, 2004, after they had just arrived at their residence at about 1:00 a.m.,
Patricia confronted Alastair John for allegedly looking at the underwear of other
ALASTAIR JOHN KANE, PETITIONER, VS. PATRICIA ROGGENKAMP, female guests at the party. Ignoring Patricia, Alastair John went on to lie down on the
RESPONDENT, bed. Patricia then sat on a nearby chair.9

DECISION
Alastair John, angered by Patricia's remarks, allegedly approached Patricia, lifted her The Court noted that there was a heated altercation between the private complainant
off the chair, and dropped her on the floor. Patricia further claimed that Alastair John and the accused after they came from the birthday party of the former's son on
punched her in the head, dragged her by the hair to the bed, and pushed her head December 1, 2004. Kane was accused of looking and peeping at the girls during the
against the pillow. Patricia fought back and, when she had the chance, ran to the party. The Court is inclined to give credence to the version of the accused. The same
bathroom and locked herself inside.10 is in accord with human experience. On the other hand[,] the version of Patricia is not
in accord with human experience. She claimed that she was grabbed by the hair, hit
The next day, on December 2, 2004, Patricia's son, Ashley Richard, visited his her head and chest, neck, pelvic area and shoulder but the clinical abstract does not
mother and saw her lying in bed in pain. Alastair John told Ashley Richard that his indicate any signs of physical violence. This court finds it unnatural why Patricia
mother had too much liquor the night of the party and, when they arrived home, declared to the doctor that she accidentally fell on a marble floor. This is her same
Alastair John tried to carry her to the bed. Unfortunately, he accidently dropped her declaration to her son, Ashley. If she was really a victim of violence or abuse, she
on the floor because the bed, which allegedly had wheels, moved.11 should have told the same to her son, especially because the latter, according to her, is
a lawyer. This court is also surprised why she did not leave the accused if it is true
Ashley Richard then brought Patricia to the San Juan de Dios Hospital where she was that he manhandled her. She could easily do those things because her relationship
prescribed painkillers for 12 days. After the trip to the hospital, Patricia went home to with the accused was that only of lovers and there was no marriage to protect and
Alastair John. Their situation went back to being peaceful, and they even went on family to save. To reiterate, the version of Mr. Kane is shown by the parties'
vacation from December 26, 2004 to January l,2005.12 actuations after the date alleged in the information. They even celebrated Christmas
in a beach resort with friends and with the accused playing Santa [Claus]. Noteworthy
On January 6, 2005, or merely five (5) days after, Alastair John allegedly verbally is the filing of the case almost one year after the alleged incident and after the parties
abused Patricia. He then left the next day, taking Patricia's car with him, as well as the started to have issues on property.18
keys to their Paranaque residence and another condominium unit in Pasig City where
he stayed. Patricia, accompanied by her driver, went to the Pasig condominium unit WHEREFORE, due to reasonable doubt, the accused, ALASTAIR JOHN KANE, is
and recovered possession of her car.13 hereby ACQUITTED of the crime [of] violation of Sec. 5(a) of R.A. 9262, penalized
by Sec. 6 (a) of the said Act.
On February 4, 2005, Patricia finally reported the incidents to the police. She
explained that, prior to the December 1, 2004 incident, there were already prior SO ORDERED.19 (Emphasis in the original)
incidents of abuse committed against her by Alastair John. After preliminary
investigation, probable cause for violation of Republic Act 9262 or the Anti-Violence Thereafter, Patricia filed a Complaint for Damages based on Article 33 of the Civil
Against Women and their Children Act of 2004 was found against Alastair John.14 Code before the Regional Trial Court of Mandaluyong City, praying for actual, moral
and exemplary damages, and attorney's fees. Patricia argued that the right of action
After trial, the Regional Trial Court, Branch 260, Paranaque City acquitted Alastair provided in Article 33 in cases of physical injuries is entirely separate and distinct
John on the ground of reasonable doubt.15 The Paranaque trial court was of the from the criminal action earlier commenced against Alastair John.20
opinion that Alastair John's account of the events—that he accidentally dropped
Patricia on the floor while he was carrying her— was "in accord with human Further, she added that the civil actions for damages under Articles 32, 33, 34, and
experience[,]”16 while that of Patricia's was not. It further said that "if [Patricia] was 2176 of the Civil Code, called independent civil actions, "are not deemed instituted
really a victim of violence or abuse, she should have told the same to her son [Ashley with the criminal action and may be filed separately by the offended party even
Richard], especially because the latter, according to her, is a lawyer."17 The without reservation." Considering that Alastair John was acquitted on the ground of
Paranaque trial court more particularly said: reasonable doubt, not because he wasn't the author of the act complained of, Patricia
argued that he may still be held liable under Article 33 of the Civil Code.21
Opposing the civil action, Alastair John filed a Motion to Dismiss on the grounds of action for damages is "for the same act or omission." Although the two actions have
res judicata and improper venue.22 Alastair John claimed that the dismissal of the different purposes, the matters discussed in the civil case are similar to those
criminal case barred the filing of the civil case, because the cases allegedly involved discussed in the criminal case. However, the judgment in the criminal proceeding
identical causes of action. He emphasized that the cases were both based on his cannot be read in evidence in the civil action to establish any fact there determined,
alleged physical abuse of Patricia, a matter already found to be not "in accord with even though both actions involve the same act or omission.
human experience."23 With respect to the venue, Alastair John argued that it was
improperly laid. The action for damages was a personal action, yet none of the parties The civil liability is not extinguished where acquittal is based on reasonable
resided in Mandaluyong City where the civil action was filed.24 doubt (Manantan vs. Court of Appeals, 350 SCRA 387).

In an April 20, 2009 Order, the Motion to Dismiss was denied by the 214th Branch of "An act or omission causing damage to another may give rise to two separate
the Regional Trial Court, Mandaluyong City, then presided by Judge Edwin D. liabilities on the part of the offender, i.e., (1) civil liability ex deli[c]to, under Article
Sorongon.25 100 of the Revised Penal Code, and (2) independent civil liabilities, such as those (a)
not arising from an act or omission complained of felony, e.g. culpa contractual or
The trial court held that civil liability was not extinguished, because Alastair John's obligations arising from law under Article 32 of the Civil Code, intentional torts
acquittal was based on reasonable doubt. Furthermore, the action filed by Patricia was under Article 32 and 34, and culpa aqiiilkma under Article 2176 of the Civil Code, or
an independent civil action which, together with the actions provided in Articles 32, (b) where the injured party is granted a right to file an independent and distinct
34, and 2176 of the Civil Code, is separate and distinct from the criminal action and criminal action (Article 33, Civil Code). Either of these two possible liabilities may
may be enforced against an offender, separately or simultaneously, with his civil be enforced against the offender (separately and simultaneously) subject, however, to
liability ex delicto under Article 100 of the Revised Penal Code. Finally, the trial the caveat under Article 2177 of the Civil Code that the offended party cannot recover
court held that venue was properly laid because at the time of the filing of the civil damages twice for the same act or omission or under both causes (Cando, Jr. v. Isip,
complaint, Patricia was already residing in Mandaluyong City.26 In the words of the G.R. No. 133978, November 12, 2002). However, a separate civil action based on
trial court: subsidiary liability cannot be instituted during the pendency of the criminal case
(Remedial Law, Herrera).
"The motion is unimpressive.
"Likewise, the ground of improper venue cannot be sustained. It was clarified by
"While it is true that accused's (herein defendant) guilt in the criminal case had not plaintiff that when she testified on May 22, 2007 and May 13, 2008 she considered
been proven beyond reasonable doubt by the trial court in Paraiiaque City, the herself a resident of Paraiiaque, however, in November 2008 and subsequently
decision however did not state in clear and [unjequivocal terms that he did not thereafter[,] she stayed at the condominium unit of her friend in. . . Mandaluyong
commit the offense charged. Hence, impliedly the trial court of Paraiiaque acquitted City. In other words, at the time of the filing of the complaint on November 29, 2008
him on reasonable doubt. Since civil liability is not extinguished in criminal cases if she was already residing in Mandaluyong City[.| Clearly, plaintiff for purposes of this
the acquittal is based on reasonable doubt[,] then the instant civil complaint must instant case is a resident of Mandaluyong City”27 (Emphasis in the original)
proceed. Civil liability arising from criminal and civil liability arising from Article
32, 33, 34 and 2176 quasi-delict for contract (Art. 31) are entirely separate and With his Motion for Reconsideration having been denied by the trial court, Alastair
distinct from the criminal action that may be brought by injured party (International John filed his Answer with Compulsory Counterclaim and Patricia, her Reply. Issues
Flavors and Fragrances, Inc. vs. Argon, 364 SCRA. 792)[.] were joined and the case was set for pre-trial.28

"Even if the guilt of the accused has not been [satisfactorily] established, he is not In the meantime, Judge Sorongon was appointed Associate Justice of the Court of
exempted from civil liability which may be proved by preponderance of evidence Appeals. Judge Ofelia Calo then acted as Presiding Judge of the Mandaluyong trial
only. This is the situation contemplated in Article 33 of the Civil Code where the civil
court29 and, in the June 8, 2010 Order, dismissed the case motu proprio on the With the decision rendered by the RTC Branch 260, Paranaque City involving the
ground oi res jiidicata and lack of jurisdiction.30 same cause of action and relief sought, and identity [of] parties, this court perceives
that the filing of the instant case in this jurisdiction constituted forum shopping. . . .
The Mandaluyong trial court said that, after "[taking] a closer look at the records
extant to the instant case[,]"31 any subsequent proceeding in the civil case would be Considering that the RTC, Branch 260, Paranaque City has already taken cognizance
"a waste of time"32 since the decision of the Paranaque trial court had the effect of of the case involving the same cause of action and identity of parties, and has in fact
res judicata. Specifically, the Mandaluyong trial court declared that the Parafiaque rendered a decision which has attained finality, this court therefore has no jurisdiction
trial court's evaluation of the parties' respective evidence meant that "the act from to try the same action.34
which the civil liability might arise did not exist."33
Patricia filed a Motion for Reconsideration, which was subsequently denied in a
Consequently, the action based on Article 33 allegedly had no basis, and Patricia November 19, 2010 Order.35
effectively committed forum shopping. Finally, it ruled that the Paranaque trial court's
decision in the criminal case already attained finality, thus depriving the Alleging error on the part of the Mandaluyong trial court, Patricia appealed before the
Mandaluyong trial court of jurisdiction over Patricia's Complaint for Damages. Court of Appeals. In the March 25, 2014 Decision,36 the Court of Appeals granted
the appeal and reversed the June 8, 2010 and August 23, 2010 Orders of the
A closer look at the records of the instant case filed by plaintiff would show that this Mandaluyong trial court.
court has no jurisdiction over the instant case.
The Court of Appeals first discussed how an act or omission may give rise to two (2)
The instant case which is for damages was also the subject matter of Criminal Case separate civil liabilities on the part of an offender. The civil liability ex delicto or that
No. 06-413 litigated in another court, the Regional Trial Court of Paranaque City, arising from the crime is provided in Article 100 of the Civil Code. On the other
Branch 260 wherein a Decision rendered by the said court acquitting the accused, the hand, independent civil liabilities are provided in Articles 32, 33, 34, and 2176 of the
herein defendant. Civil Code, which are liabilities separate and distinct from the criminal action and
may be pursued independently of it. Reservation to file the civil action is even
Although the motion to dismiss filed by defendants on the grounds that the instant unnecessary. Thus, an offended party may pursue any of these civil liabilities,
complaint is barred by prior judgment and improper venue was already denied for whether ex delicto or not, subject to Article 2177 of the Civil Code prohibiting double
lack of merit in an Order dated 20 April 2009, the undersigned acting presiding judge recovery.37
deemed it proper to take a closer look at the records extant to the instant case
considering that proceeding to the initial trial will just be a waste of time and any The Court of Appeals then emphasized that the civil case filed by Patricia was based
proceedings taken by the court will only be a nullity if the court has no jurisdiction on Article 33 of the Civil Code, an independent civil action. Thus, contrary to the
because of the principle of res judicata. Mandaluyong trial court's ruling, the decision of the Paranaque trial court acquitting
Alastair John did not operate as res judicata so as to bar the filing of the Complaint
Verily, the evaluation made by the RTC, Branch 260, Paranaque City of the criminal for Damages under Article 33. It was immaterial that the decision of the Paranaque
case giving credence to the version of the accused, which the Court perceived to be in trial court had already become final and executory, because the causes of action
accord with human experience, and pointing to factual circumstances and explaining between the case for violation of Republic Act No. 9262 and the one filed under
why the version of Patricia is not in accord with human experience, is a clear showing Article 33 of the Civil Code are different.38
that the act from which the civil liability might arise did not exist.
The Court of Appeals held that Patricia did not commit forum shopping because the
causes of action for the criminal action and the Complaint for Damages are different.
There can also be no forum shopping, according the Court of Appeals, when the law
expressly allows the filing of an independent civil action in cases of physical from an accident. With the decision of the Paranaque trial court having attained
injuries.39 finality, it is allegedly binding upon the parties, and the Complaint for Damages was
correctly dismissed by the Mandaluyong trial court.48
Finally, the Court of Appeals held that the venue was properly laid. Under the Rules
of Court, personal actions, such as an action for damages, must be filed in the plaintiff It follows that in filing the Complaint for Damages, respondent committed forum
or defendant's residence, at the election of the plaintiff, unless the parties agree on shopping. Specifically, respondent allegedly sought damages after she failed to secure
another venue. Considering that Patricia was already residing in Mandaluyong City at a favorable ruling with the Paranaque trial court.49
the time of the filing of the case, she correctly filed the Complaint for Damages
before the Regional Trial Court of Mandaluyong.40 Finally, petitioner contends that the venue for the civil action was improperly laid.
Although the term "residence" merely refers to a physical habituation or actual
The dispositive portion of the Court of Appeals' March 25, 2014 Decision read: residence, the physical presence and actual stay in that place must be more than
temporary and must be with continuity and consistency. According to petitioner,
WHEREFORE, the appeal is GRANTED. The Orders dated June 8, 2010 and respondent failed to establish such continuity, as she testified under oath in two (2)
November 19, 2010 of the Regional Trial Court of Mandaluyong City, Branch 214 in proceedings that she was a resident of Paranaque City:50 (1) one in 2007; and (2)
Civil Case No. MC08-3871 are REVERSED AND SET ASIDE. The Regional Trial another in 2008, both after the filing of the Complaint for Damages. These
Court of Mandaluyong City, Branch 214 is DIRECTED to reinstate Civil Case No. declarations should bind respondent, since her declarations were given under pain of
MC08-3871, to continue with the proceedings and to resolve the same with deliberate prosecution for perjury.51
dispatch.
Respondent counters that the Court of Appeals committed no error in ruling that
SO ORDERED.41 (Emphasis in the original) petitioner may still be held liable for damages, regardless of his acquittal in the
criminal case. According to respondent, nowhere in the text of the Paranaque trial
Alastair John then filed a Motion for Reconsideration, which was denied by the Court court decision could it be inferred that the fact from which petitioner's civil liability
of Appeals in the September 3, 2014 Resolution.42 might arise did not exist.

On October 9, 2014, Alastair John filed his Petition for Review on Certiorari.43 Upon On the contrary, the Paranaque trial court explicitly stated that it acquitted petitioner
the directive of this Court, Patricia filed her Comment,44 to which Alastair John "due to reasonable doubt[.]"52 Consequently, the Mandaluyong trial court should
replied.45 have proceeded to trial, and petitioner's liability for physical injuries, if any, should
have been ascertained.53
Petitioner mainly argues that he may no longer be made liable for damages under
Article 33 of the Civil Code. According to petitioner, the Paranaque trial court's Respondent further submits that res jiidicata does not apply in the present case. She
decision on the criminal case for violation of Republic Act No. 9262 clearly maintains that the civil actions under Articles 32, 33, 34 and 2176 of the Civil Code
established that "the act or omission from which the civil liability may arise did not are independent civil actions which may be separately filed by the offended party,
exist."46 Therefore, there is no basis to hold him liable for damages for the alleged even without reservation in the prosecution of the criminal action. Therefore,
physical injuries sustained by respondent.47 respondent is legally "allowed to file two (2) separate suits for the same act or
omission. The first a criminal suit where the civil action to recover civil liability ex-
Further, petitioner maintains that respondent's Complaint for Damages was already delicto is deemed instituted, and the other a civil case for quasi-delict[,]"54 and the
barred by res judicata. He claims that the Complaint for Damages was based on the independent civil action may proceed regardless of the result of the proceedings in the
alleged intentional physical injuries sustained by respondent. In the criminal case, criminal case.'55
however, the Paranaque trial court already ruled that the physical injuries resulted
On the issue of forum shopping, respondent contends that the Court of Appeals
correctly ruled on the issue. According to respondent, the civil liability under Article Article 33 is explicit that in cases of defamation, fraud, and physical injuries., the
33 of the Civil Code is separate and distinct from the civil liability arising under civil action is "entirely separate and distinct from the criminal action" and shall
Article 100 of the Revised Penal Code. Thus, an offended party may pursue both "proceed independently of the criminal prosecution." Accordingly, Article 33
kinds of civil liability, even simultaneously, without offending the rule against forum "contemplates a civil action for the recovery of damages that is entirely unrelated to
shopping.56 the purely criminal aspect of the case."59 Even the quantum of proof required—
preponderance of evidence, as opposed to the proof beyond reasonable doubt in
Lastly, respondent maintains that, as correctly found by the Court of Appeals, the criminal cases—is different, confirming that the civil action under Article 33 is
venue was properly laid. She argues that "whether [she] lived in other places prior to independent of the criminal action.
[the filing of the complaint] is irrelevant[,]"57 and in this case, she clearly established
that she was a resident of Mandaluyong City when she filed her Complaint for Reservation of the right to separately file a civil action for damages under Article 33
Damages under Article 3358 need not even be made. The civil action under Article 33 may be pursued before the
filing of the criminal case,60 during the pendency of the criminal case,61 or even
The issues for this Court's resolution are: after the criminal case is resolved.62 The only limitation is that an offended party
cannot "recover [damages] twice for the same act or omission" of the defendant. Rule
First, whether or not petitioner Alastair John Kane may still be held civilly liable 111, Section 3 of the 2000 Revised Rules of Criminal Procedure provides:
because his acquittal was based on reasonable doubt;
RULE 111
Second, whether or not the Complaint for Damages was already barred by res Prosecution of Civil Action
judicata;
SECTION 3. When Civil Action May Proceed Independently. — In the cases
Third, whether or not respondent Patricia Roggenkamp committed forum shopping; provided in Articles 32, 33, 34 and 2176 of the Civil Code of the Philippines, the
and, independent civil action may be brought by the offended party. It shall proceed
independently of the criminal action and shall require only a preponderance of
Fourth, whether or not the venue was properly laid. evidence. In no case, however, may the offended party recover damages twice for the
same act or omission charged in the criminal action.
This Petition must be denied. The Mandaluyong trial court seriously erred in motu
proprio dismissing respondent's Complaint for Damages on the grounds of res Further, "defamation," "fraud," and "physical injuries," as used in Article 33, are to be
judicata and lack of jurisdiction. understood in their ordinary sense. Specifically, the "physical injuries" contemplated
in Article 33 is bodily injury, not the "physical injuries" referred to in the Revised
I Penal Code. As first explained in Carandang v. Santiago:63

Respondent based her Complaint for Damages against petitioner on Article 33 of the [Article 33 uses the words "defamation", ''fraud" and "physical injuries." Defamation
Civil Code: and fraud are used in their ordinary sense because there are no specific provisions in
the Revised Penal Code using these terms as means of offenses defined therein, so
ARTICLE 33. In cases of defamation, fraud, and physical injuries, a civil action for that these two terms defamation and fraud must have been used not to impart to them
damages, entirely separate and distinct from the criminal action, may be brought by any technical meaning in the laws of the Philippines, but in their generic sense. With
the injured party. Such civil action shall proceed independently of the criminal this apparent circumstance in mind, it is evident that the term "physical injuries"
prosecution, and shall require only a preponderance of evidence. could not have been used in its specific sense as a crime defined in the Revised Penal
Code, for it is difficult to believe that the Code Commission would have used terms in
the same article — some in their general and another in its technical sense. In other Paragraphs (a), (b), and (c) of Section 5 specifically refer to acts of "physical
words, the term "physical injuries" should be understood to mean bodily injury, not violence," which, under the law, includes "acts that include bodily or physical
the crime of physical injuries, because the terms used with the latter are general harm[.]"
terms. In any case the Code Commission recommended that the civil action for
physical injuries be similar to the civil action for assault and battery in American It is not hard to see that respondent properly availed herself of a separate action for
Law, and this recommendation must have been accepted by the Legislature when it damages under Article 33 after the dismissal of the criminal case against petitioner.
approved the article intact as recommended. If the intent has been to establish a civil The criminal action filed against petitioner was one for physical injuries in the sense
action for the bodily harm received by the complainant similar to the civil action for contemplated in Article 33, that is, bodily injury.
assault and battery, as the Code Commission states, the civil action should lie whether
the offense committed is that of physical injuries, or frustrated homicide, or attempted Nevertheless, Alastair John claims that his acquittal should have barred the filing of
homicide, or even death.64 the Complaint for Damages. He maintains that, as allegedly held by the Paranaque
trial court, the act or commission from which the civil liability might arise did not
Madeja v. Caro65 reiterates that "physical injuries" in Article 33 means bodily exist; hence, there is no civil liability ex delicto to which the Article 33 action may be
injury. anchored.

Alastair John was charged with violating Section 5(a) of Republic Act No. 9262, or The contention is without merit.
the Anti-Violence Against Women and Children Act of 2004:
Under Rule 120, Section 2 of the 2000 Revised Rules of Criminal Procedure, a
SECTION 5. Acts of Violence Against Women and Their Children. — The crime of judgment acquitting the accused must state whether the prosecution absolutely failed
violence against women and their children is committed through any of the following to prove the guilt of the accused or merely failed to prove his guilt beyond reasonable
acts: doubt. Furthermore, the judgment must determine if the act or omission from which
the civil liability might arise did not exist:
(a) Causing physical harm to the woman or her child;
RULE 120
(b) Threatening to cause the woman or her child physical harm; Judgment

(c) Attempting to cause the woman or her child physical harm[.] ....

Section 5 enumerates the various "acts of violence against women and their children," SECTION 2. Contents of the Judgment. — If the judgment is of conviction, it shall
generally defined as: 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
SECTION 3. Definition of Terms. — any act or a series of acts committed by any commission; (2) the participation of the accused in the offense, whether as principal,
person against a woman who is his wife, former wife, or against a woman with whom accomplice, or accessory after the fact; (3) the penalty imposed upon the accused; and
the person has or had a sexual or dating relationship, or with whom he has a common (4) the civil liability or damages caused by his wrongful act or omission to be
child, or against her child whether legitimate or illegitimate, within or without the recovered from the accused by the offended party, if there is any, unless the
family abode, which result in or is likely to result in physical, sexual, psychological enforcement of the civil liability by a separate civil action has been reserved or
harm or suffering, or economic abuse including threats of such acts, battery, assault, waived.
coercion, harassment or arbitrary deprivation of liberty.66
In case the judgment is of acquittal, it shall state whether the evidence of the liability ex delicto is out of the question, and the civil action, if any, which may be
prosecution absolutely failed to prove the guilt of the accused or merely failed to instituted must be based on grounds other than the delict complained of. This is the
prove his guilt beyond reasonable doubt. In either case, the judgment shall situation contemplated in Rule 111 of the Rules of Court. The second instance is an
determine if the act or omission from which the civil liability might arise did not acquittal based on reasonable doubt on the guilt of the accused. In this case, even if
exist. (Emphasis supplied) 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. This is
It is essential to indicate whether the act or omission from which the civil liability the situation contemplated in Article 29 of the Civil Code, where the civil action for
might arise did not exist. Without such declaration, it must be presumed that the damages is "for the same act or omission." Although the two actions have different
acquittal was due to reasonable doubt, and the accused is civilly liable ex delicto. purposes, the matters discussed in the civil case are similar to those discussed in the
Thus, the general rule shall apply: every person criminally liable is also civilly criminal case. However, the judgment in the criminal proceeding cannot be read in
liable.67 evidence in the civil action to establish any fact there determined, even though both
actions involve the same act or omission. The reason for this rule is that the parties
In Manantan v. Court of Appeals,68 accused George Manantan was charged with are not the same and secondarily, different rules of evidence are applicable. Hence,
reckless imprudence resulting in homicide. The trial court acquitted him of the crime notwithstanding herein petitioner's acquittal, the Court of Appeals in determining
charged, leading the heirs of the deceased to appeal the civil aspect of the trial court whether Article 29 applied, was not precluded from looking into the question of
decision. Despite Manantan's acquittal, the Court of Appeals granted the appeal, petitioner's negligence or reckless imprudence.73 (Citations omitted)
declared Manantan to be the "proximate cause of the vehicular accident,"69 and held
him civilly liable. Like in Mcmantan, nowhere in the decision of the Parafiaque trial court in the
criminal case does it state that the act or omission from which civil liability might
Among Manantan's arguments before this Court was that the Court of Appeals erred arise did not exist. On the contrary, the trial court was unequivocal that petitioner was
in finding him civilly liable, because the trial court already found that he was neither acquitted due to reasonable doubt:
imprudent nor negligent. To this, this Court said that nowhere in the text of the trial
court decision can it be inferred that no negligence or imprudence existed. All the WHEREFORE, due to reasonable doubt, the accused, ALASTAIR JOHN KANE, is
judgment provided was that Manantan was "NOT GUILTY of the crime hereby ACQUITTED of the crime [of] violation of Sec[.] 5(a) of R.A. 9262,
charged[.]"70 penalized by Sec[.] 6 (a) of the said Act.

Thus, the Court of Appeals "was not precluded from looking into the question of SO ORDERED.74 (Emphasis supplied)
[Manantan's] negligence or reckless imprudence[,]"71 for "even if [his guilt] has not
been satisfactorily established, he is not exempt from civil liability which may be Having been acquitted due to reasonable doubt, petitioner is not exempt from civil
proved by preponderance of evidence only."72 In other words, Manantan's acquittal liability. This is true even if his guilt was not satisfactorily established.
was not because the act or omission from which the civil liability might arise did not
exist. Therefore, Manantan was correctly held civilly liable by the Court of Appeals. II
Explained this Court:
Furthermore, contrary to petitioner's argument, the decision of the Parafiaque trial
Our law recognizes two kinds of acquittal, with different effects on the civil liability court acquitting him did not operate as res judicata so as to bar the filing of the
of the accused. First is an acquittal on the ground that the accused is not the author of Complaint for Damages under Article 33 of the Civil Code.
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 The concept of res judicata was expounded in Club Filipino, Inc. v. Bautista:75
and can never be held liable for such act or omission. There being no delict, civil
Res judicata "literally means 'a matter adjudged; a thing judicially acted upon or that "the dismissal of the criminal cases. . . on the ground of lack of interest or failure
decided; [or] a thing or matter settled by judgment.'" Res jiidicata "lays the rule that to prosecute is an adjudication on the merits which amounted to res judicata on the
an existing final judgment or decree rendered on the merits, and without fraud or civil case for collection."78
collusion, by a court of competent jurisdiction, upon any matter within its
jurisdiction, is conclusive of the rights of the parties or their privies, in all other On appeal, this Court set aside the trial court's decision. It explained that an act or
actions or suits in the same or any other judicial tribunal of concurrent jurisdiction on omission causing damage to another may give rise to two (2) separate civil liabilities:
the points and matters in issue in the first suit." (1) civil liability ex delicto, or that arising from the crime, and (2) independent civil
liabilities, i.e., those not arising from the crime, or those where the law expressly
Res judicata has two (2) aspects. The first is bar by prior judgment that precludes the grants the injured party the right to file an independent and distinct civil action from
prosecution of a second action upon the same claim, demand or cause of action. The the criminal action. An action for collection of sum of money is not an action arising
second aspect is conclusiveness of judgment, which states that "issues actually and from the crime but from contract, an independent civil action which, according to this
directly resolved in a former suit cannot again be raised in any future case between Court, may be pursued even without reservation.79
the same parties involving a different cause of action."
This Court rejected the contention that the collection case was barred by res judicata.
The elements of res judicata are: Among the elements of res judicata is that there is an identity of causes of action
between the actions, and between a criminal case based on culpa criminal and an
(1) the judgment sought to bar the new action must be final; action based on culpa contractual, there is no such identity of causes of action. The
independent civil action:
(2) the decision must have been rendered by a court having jurisdiction over the
subject matter and the parties; . . . remains separate and distinct from any criminal prosecution based on the same
act. Not being deemed instituted in the criminal action based on culpa criminal, a
(3) the disposition of the case must be a judgment on the merits; and ruling on the culpability of the offender will have no bearing on said independent
civil action based on an entirely different cause of action, i.e., culpa contractual80
(4) there must be as between the first and second action identity of parties, subject (Citation omitted; emphasis in the original)
matter, and causes of action[.]76 (Citations omitted; emphasis in the original)
The defense of res judicata was likewise raised but nonetheless rejected in Lim v.
It is settled that a decision acquitting the accused is not res judicata on the Kou Co Ping.81 The case involved withdrawal authorities issued by a cement
independent civil action, even if the latter action arises from the same act or omission corporation, thereby allowing holders of the instrument to withdraw cement bags
on which the criminal action was based. from the corporation's cement plant. Kou Co Ping had earlier bought withdrawal
authorities, which he subsequently sold to Lily Lim. When Lim failed to withdraw
In Cancio v. hip,77 cases for estafa were filed against Emerenciana Isip for issuing cement bags covered by the withdrawal authorities, she sued Kou Co Ping for estafa
checks with insufficient funds. After it had failed to present its second witness, the before the Regional Trial Court of Pasig.
prosecution moved to dismiss the estafa cases, but reserved the right to file a separate
civil action. The motion was granted, and the private complainant, Jose Cancio, Jr., The trial court acquitted Kou Co Ping of estafa for insufficiency of evidence.
subsequently filed a case for collection of sum of money to recover the amount of the However, it set the case for reception of evidence on Kou Co Ping's civil liability.
checks subject of the estafa cases. After trial on the criminal case, the trial court also absolved Kou Co Ping of civil
liability to Lim.
Isip filed a motion to dismiss, arguing that that the collection case was barred on the
ground of res judicata. The trial court agreed and dismissed the collection case. It held
This caused Lim to subsequently file a complaint for specific performance and ART. 31. When the civil action is based on an obligation not arising from the act or
damages before the Regional Trial Court of Manila. Moving to dismiss the complaint, omission complained of as a felony, such civil action may proceed independently of
Kou Co Ping argued that his acquittal in the estafa case was res judicata on the the criminal proceedings and regardless of the result of the latter.
specific performance and damages case.
ART. 33. In cases of defamation, fraud, and physical injuries a civil action for
The Manila trial court denied the motion to dismiss, which was affirmed by this damages, entirely separate and distinct from the criminal action, may be brought by
Court. Citing Cancio, this Court discussed how an act or omission may give rise to the injured party. Such civil action shall proceed independently of the criminal
civil liability arising from different sources. The source of the civil liability arising prosecution, and shall require only a preponderance of evidence.
from the offense is different from that arising from contract, and an offended party
may pursue either or both, subject to the prohibition on double recovery under Article Because of the distinct and independent nature of the two kinds of civil liabilities,
2177 of the Civil Code. Considering that the complaint for specific performance and jurisprudence holds that the offended party may pursue the two types of civil
damages is premised on a civil liability, and not arising from crime but from contract, liabilities simultaneously or cumulatively, without offending the rules on forum
this Court held that the decision on the civil aspect of the estafa case had no bearing shopping, litis pendentia, or res judicala. As explained in Cancio, Jr. v. Isip:
on the case for specific performance and damages. In Lim:
One of the elements of res judicata is identity of causes of action.1âшphi1 In the
A single act or omission that causes damage to an offended party may give rise to two instant case, it must be stressed that the action filed by petitioner is an independent
separate civil liabilities on the part of the offender — (1) civil liability ex delicto, that civil action, which remains separate and distinct from any criminal prosecution based
is, civil liability arising from the criminal offense under Article 100 of the Revised on the same act. Not being deemed instituted in the criminal action based on cirtpa
Penal Code, and (2) independent civil liability, that is, civil liability that may be criminal, a ruling on the culpability of the offender will have no bearing on said
pursued independently of the criminal proceedings. The independent civil liability independent civil action based on an entirely different cause of action, i.e., culpa
may be based on "an obligation not arising from the act or omission complained of as contractual.
a felony," as provided in Article 31 of the Civil Code (such as for breach of contract
or for tort). It may also be based on an act or omission that may constitute felony but, In the same vein, the filing of the collection case after the dismissal of the estafa cases
nevertheless, treated independently from the criminal action by specific provision of against [the offender] did not amount to forum-shopping. The essence of forum
Article 33 of the Civil Code ("in cases of defamation, fraud and physical injuries"). shopping is the filing of multiple suits involving the same parties for the same cause
of action, either simultaneously or successively, to secure a favorable judgment.
The civil liability arising from the offense or ex delicto is based on the acts or Although the cases filed by [the offended party] arose from the same act or omission
omissions that constitute the criminal offense; hence, its trial is inherently intertwined of [the offender], they are, however, based on different causes of action. The criminal
with the criminal action. For this reason, the civil liability ex delicto is impliedly cases for estafa are based on culpa criminal while the civil action for collection is
instituted with the criminal offense. If the action for the civil liability ex delicto is anchored on culpa contractual. Moreover, there can be no forum-shopping in the
instituted prior to or subsequent to the filing of the criminal action, its proceedings are instant case because the law expressly allows the filing of a separate civil action
suspended until the final outcome of the criminal action. The civil liability based on which can proceed independently of the criminal action.82 (Citations omitted;
delict is extinguished when the court hearing the criminal action declares that "the act emphasis in the original)
or omission from which the civil liability may arise did not exist."
Applying the foregoing, petitioner's acquittal in the case for violation of Section 5(a)
On the other hand, the independent civil liabilities are separate from the criminal of Republic Act No. 9262 is not res judicata on the action for damages under Article
action and may be pursued independently, as provided in Articles 31 and 33 of the 33 of the Civil Code. One of the elements of res judicata is the identity of causes of
Civil Code, which state that: action, with "cause of action" being the "act or omission by which a party violates a
right of another."83
 Litis pendentia "refers to that situation wherein another action is pending between the
While the criminal action and the action for damages arise from the same act or same parties for the same cause of action, such that the second action becomes
omission—the alleged physical violence committed by petitioner against respondent unnecessary and vexatious."89
—these actions violate two (2) different rights of respondent: (1) her right not to be
physically harmed by an intimate partner under Republic Act No. 9262; and (2) her The following requisites must concur for litis pendentia to be present: (1) the identity
right to recover damages for bodily injury under Article 33 of the Civil Code. of parties, or at least such as representing the same interests in both actions; (2) the
identity of rights asserted and relief prayed for; and (3) the identity of the two (2)
In other words, the criminal case and the civil case do not have identical causes of cases such that judgment in one, regardless of which party is successful, would
action, and respondent had the right to pursue either petitioner's civil liability arising amount to res judicata in the other.90
from the violation of Republic Act No. 9262, or the independent civil liability
provided for in Article 33 of the Civil Code. As discussed, the final judgment on the violation for Section 5(a) of Republic Act No.
9262 does not amount to res judicata in the action for damages under Article 33 of the
Even the finality of the acquittal is immaterial in the present case. To reiterate: Civil Code. Further, Article 33 expressly allows the filing of a separate civil action
actions under Article 33 of the Civil Code are '"separate, distinct, and independent' of for damages arising from physical injuries that can proceed independently of the
any criminal prosecution based on the same act [or omission]"84 on which the civil criminal action. With one of the crucial elements of res judicata being absent, there
action was filed. As this Court said in Cancio, "a ruling on the culpability of the can be no forum shopping in this case.
offender will have no bearing on [the] independent civil action based on an entirely
different cause of action[.]"85 IV

All told, the Court of Appeals correctly rejected petitioner's res judicata argument. The Court of Appeals correctly held that the venue was properly laid.

III Venue is "the place where the case is to be heard or tried[.]"91 Under our Rules, the
venue of an action generally depends on whether it is a real or personal action.
Corollarily, this Court affirms the Court of Appeals' ruling that respondent did not
commit forum-shopping when she filed the Complaint for Damages under Article 33 Real actions are those affecting the title or possession of a real property, or interest
of the Civil Code. Forum shopping is committed therein, to be commenced and tried in the proper court which has jurisdiction over the
area wherein the real property involved, or a portion thereof, is situated.92 All other
by a party who institutes two or more suits in different courts, either simultaneously actions, called personal actions, may be commenced and tried where the plaintiff or
or successively, in order to ask the courts to rule on the same or related causes or to any of the principal plaintiffs reside, or where the defendant or any of the principal
grant the same or substantially the same reliefs, on the supposition that one or the defendants reside, at the election of the plaintiff.93
other court would make a favorable disposition or increase a party's chances of
obtaining a favorable decision or action[.]86 (Citation omitted) The action for damages filed by respondent does not involve the title or possession of
a real property, or interest therein. It is a personal action, and respondent, as plaintiff,
To determine whether there is forum shopping, it is necessary to ascertain "whether had the option of either filing it in her place of residence or the defendant, petitioner's,
the elements of litis pendentia are present, or whether a final judgment in one case place of residence. She chose to file the civil case in her place of residence, that is,
will amount to res judicata in another[.]"87 The test is "whether in the two (or more) Mandaluyong City.
cases pending, there is identity of parties, rights or causes of action, and reliefs
sought."88 Petitioner, however, maintains that Mandaluyong City is not respondent's
place of residence. While respondent alleged in her Complaint for Damages that she
resides in a condominium unit in Mandaluyong City, petitioner cites two (2) instances father, is possibly a more ordinary and enlightened view of respondent's motive,
where respondent testified that she residesat a condominium unit in Paranaque City. assuming the facts as established by the court trying the criminal case.
The venue, petitioner argues, was improperly laid and the Complaint for Damages
should be dismissed accordingly. Similarly, that someone, usually the woman, would hesitate to simply leave her
family and deprive them of her caring for her part in maintaining the household, even
Looking into petitioner's allegations, he cites parts of the proceedings in the criminal at peril to herself or her dignity, is not outlandish, inconceivable or, sadly, even
case, specifically, the hearing held on May 22, 200794 and May 13, 200895 where exceptional. Certainly, it is "in accord with human experience."99
respondent testified that she resided in a condominium in Paranaque.
These motives, often perpetuated by culture, are the precise targets of our laws which
The Complaint for Damages, however, was filed on November 28, 2008,96 and it underscore gender equality in every type of relationship. It is the awareness of the
could very well be that, as respondent had alleged in her civil complaint, she was possibility of abuse that a more gendered perspective of human intentions is
already a resident of Mandaluyong City at that time. Absent proof to the contrary, this privileged by laws on sexual harassment—including the law which seeks to prohibit
Court affirms the findings of the Court of Appeals that "[a]t the time of the filing of violence against women in intimate relationships. The rather dismal failure to
this case, [respondent] was already residing [at Mandaluyong City]. Thus, venue was consider the complexity of the human psyche in the criminal case may not be how the
properly laid at the [Regional Trial Court] of Mandaluyong City."97 judge in the civil case will consider the case given the same set of evidence. It is in
these respects that We see the wisdom of our current rules.
As a final note, not only did the Mandaluyong trial court err in dismissing the action
based on Article 33 of the Civil Code by assuming that the acquittal, by itself, is a WHEREFORE, the Petition for Review on Certiorari is DENIED. The Court of
declaration that the facts upon which the civil action can arise did not exist is already Appeals' March 25, 2014 Decision and September 13, 2014 Resolution in CA-G.R.
presumed. The court that tried the civil case also possibly erred in the manner by CV No. 96341 are hereby AFFIRMED. The
which it interpreted the facts on the basis of what it considered as which narrative is
"in accord with human experience."98 Regional Trial Court of Mandaluyong City, Branch 214, is hereby DIRECTED to
reinstate Civil Case No. MC08-3871, continue with the proceedings, and to resolve
The two (2) points articulated in the decision regarding the criminal case seems to the same with dispatch.
reveal the severe lack of gender sensitivity and/or practical wisdom on the trial court
judge's part. The first is the assertion that the woman chose to hide her lover's SO ORDERED.
transgressions against her person before the doctor, as well as her son. The second is
the judge's assertion of his conclusion that the hesitation of the woman to
immediately leave her lover is an unnatural act and, hence, unbelievable.

These assumptions that provide the filters for a judge to eventually acquit,
demonstrate that there is a possibility that another civil action may interpret the facts
differently. A more enlightened interpretation of the evidence may involve a less
caricaturized, less patriarchal set of assumptions. For instance, the capability of
women to sacrifice their own welfare in favor of those who they care for and love
is known to many women.

Thus, protecting the husband's reputation before a stranger, even if that stranger be a
doctor, or sparing the son from a premature dilemma that undermines his view of his