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Civil Procedure Case Set 2 New Era University College of Law PERRAL

Republic of the Philippines SUPREME COURT Manila FIRST DIVISION G.R. No. L-58028 April 18, 1989 5. Whether or not the awards made by the respondent court were warranted. We hold against the petitioner on the first question. It is true that Rule 3, Section 1, of the Rules of Court clearly provides that "only natural or juridical persons may be parties in a civil action." It is also not denied that the school has not been incorporated. However, this omission should not prejudice the private respondent in the assertion of her claims against the school. As a school, the petitioner was governed by Act No. 2706 as amended by C.A. No. 180, which provided as follows: Unless exempted for special reasons by the Secretary of Public Instruction, any private school or college recognized by the government shall be incorporated under the provisions of Act No. 1459 known as the Corporation Law, within 90 days after the date of recognition, and shall file with the Secretary of Public Instruction a copy of its incorporation papers and by-laws. Having been recognized by the government, it was under obligation to incorporate under the Corporation Law within 90 days from such recognition. It appears that it had not done so at the time the complaint was filed notwithstanding that it had been in existence even earlier than 1932. The petitioner cannot now invoke its own non-compliance with the law to immunize it from the private respondent's complaint. There should also be no question that having contracted with the private respondent every year for thirty two years and thus represented itself as possessed of juridical personality to do so, the petitioner is now estopped from denying such personality to defeat her claim against it. According to Article 1431 of the Civil Code, "through estoppel an admission or representation is rendered conclusive upon the person making it and cannot be denied or disproved as against the person relying on it." As the school itself may be sued in its own name, there is no need to apply Rule 3, Section 15, under which the persons joined in an association without any juridical personality may be sued with such association. Besides, it has been shown that the individual members of the board of trustees are not liable, having been appointed only after the private respondent's dismissal. 6 It is clear now that a charitable institution is covered by the labor laws 7 although the question was still unsettled when this case arose in 1968. At any rate, there was no law even then exempting such institutions from the operation of the labor laws (although they were exempted by the Constitution from ad valorem taxes). Hence, even assuming that the petitioner was a charitable institution as it claims, the private respondent was nonetheless still entitled to the protection of the Termination Pay Law, which was then in force. While it may be that the petitioner was engaged in charitable works, it would not necessarily follow that those in its employ were as generously motivated. Obviously, most of them would not have the means for such charity. The private respondent herself was only a humble school teacher receiving a meager salary of Pl80. 00 per month. At that, it has not been established that the petitioner is a charitable institution, considering especially that it charges tuition fees and collects book rentals from its students. 8 While this alone may not indicate that it is profit-making, it does weaken its claim that it is a non-profit entity. The petitioner says the private respondent had not been illegally dismissed because her teaching contract was on a yearly basis and the school was not required to rehire her in 1968. The argument is that her services were terminable at the end of each year at the discretion of the school. Significantly, no explanation was given by the petitioner, and no advance notice either, of her relief after teaching year in and year out for all of thirty-two years, the private respondent was simply told she could not teach any more. The Court holds, after considering the particular circumstance of Oh's employment, that she had become a permanent employee of the school and entitled to security of tenure at the time of her dismissal. Since no cause was shown and established at an appropriate hearing, and the notice then required by law had not been given, such dismissal was invalid. The private respondent's position is no different from that of the rank-and-file employees involved in Gregorio Araneta University Foundation v. NLRC, 9 of whom the Court had the following to say: Undoubtedly, the private respondents' positions as deans and department heads of the petitioner university are necessary in its usual business. Moreover, all the private respondents have been serving the university from 18 to 28 years. All of them rose from the ranks starting as instructors until they became deans and department heads of the university. A person who has served the University for 28 years and who occupies a high administrative position in addition to teaching duties could not possibly be a temporary employee or a casual. The applicable law is the Termination Pay Law, which provided: SECTION 1. In cases of employment, without a definite period, in a commercial, industrial, or agricultural establishment or enterprise, the employer or the employee may terminate at any time the employment with just cause; or without just cause in the case of an employee by serving written notice on the employer at least one month in advance, or in the case of an employer, by serving such notice to the employee at least one month in advance or one-half month for every year of service of the employee, whichever, is longer, a fraction of at least six months being considered as one whole year.

CHIANG KAI SHEK SCHOOL, petitioner, vs. COURT OF APPEALS and FAUSTINA FRANCO OH, respondents. CRUZ, J.: An unpleasant surprise awaited Fausta F. Oh when she reported for work at the Chiang Kai Shek School in Sorsogon on the first week of July, 1968. She was told she had no assignment for the next semester. Oh was shocked. She had been teaching in the school since 1932 for a continuous period of almost 33 years. And now, out of the blue, and for no apparent or given reason, this abrupt dismissal. Oh sued. She demanded separation pay, social security benefits, salary differentials, maternity benefits and moral and exemplary damages. 1 The original defendant was the Chiang Kai Shek School but when it filed a motion to dismiss on the ground that it could not be sued, the complaint was amended. 2 Certain officials of the school were also impleaded to make them solidarily liable with the school. The Court of First Instance of Sorsogon dismissed the complaint. 3 On appeal, its decision was set aside by the respondent court, which held the school suable and liable while absolving the other defendants. 4 The motion for reconsideration having been denied, 5 the school then came to this Court in this petition for review on certiorari. The issues raised in the petition are: 1. Whether or not a school that has not been incorporated may be sued by reason alone of its long continued existence and recognition by the government, 2. Whether or not a complaint filed against persons associated under a common name will justify a judgment against the association itself and not its individual members. 3. Whether or not the collection of tuition fees and book rentals will make a school profit-making and not charitable. 4. Whether or not the Termination Pay Law then in force was available to the private respondent who was employed on a yearto-year basis.

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The employer, upon whom no such notice was served in case of termination of employment without just cause may hold the employee liable for damages. The employee, upon whom no such notice was served in case of termination of employment without just cause shall be entitled to compensation from the date of termination of his employment in an I amount equivalent to his salaries or wages correspond to the required period of notice. ... . The respondent court erred, however, in awarding her one month pay instead of only one-half month salary for every year of service. The law is quite clear on this matter. Accordingly, the separation pay should be computed at P90.00 times 32 months, for a total of P2,880.00. Parenthetically, R.A. No. 4670, otherwise known as the Magna Carta for Public School Teachers, confers security of tenure on the teacher upon appointment as long as he possesses the required qualification. 10 And under the present policy of the Department of Education, Culture and Sports, a teacher becomes permanent and automatically acquires security of tenure upon completion of three years in the service. 11 While admittedly not applicable to the case at bar, these I rules nevertheless reflect the attitude of the government on the protection of the worker's security of tenure, which is now guaranteed by no less than the Constitution itself. 12 We find that the private respondent was arbitrarily treated by the petitioner, which has shown no cause for her removal nor had it given her the notice required by the Termination Pay Law. As the respondent court said, the contention that she could not report one week before the start of classes is a flimsy justification for replacing her. 13 She had been in its employ for all of thirty-two years. Her record was apparently unblemished. There is no showing of any previous strained relations between her and the petitioner. Oh had every reason to assume, as she had done in previous years, that she would continue teaching as usual. It is easy to imagine the astonishment and hurt she felt when she was flatly and without warning told she was dismissed. There was not even the amenity of a formal notice of her replacement, with perhaps a graceful expression of thanks for her past services. She was simply informed she was no longer in the teaching staff. To put it bluntly, she was fired. For the wrongful act of the petitioner, the private respondent is entitled to moral damages. 14 As a proximate result of her illegal dismissal, she suffered mental anguish, serious anxiety, wounded feelings and even besmirched reputation as an experienced teacher for more than three decades. We also find that the respondent court did not err in awarding her exemplary damages because the petitioner acted in a wanton and oppressive manner when it dismissed her. 15 The Court takes this opportunity to pay a sincere tribute to the grade school teachers, who are always at the forefront in the battle against illiteracy and ignorance. If only because it is they who open the minds of their pupils to an unexplored world awash with the magic of letters and numbers, which is an extraordinary feat indeed, these humble mentors deserve all our respect and appreciation. WHEREFORE, the petition is DENIED. The appealed decision is AFFIRMED except for the award of separation pay, which is reduced to P2,880.00. All the other awards are approved. Costs against the petitioner. This decision is immediately executory. SO ORDERED.

Civil Procedure Case Set 2 New Era University College of Law PERRAL
Republic of the Philippines SUPREME COURT Manila SECOND DIVISION G.R. No. L-31061 August 17, 1976 continuously possessed the said property openly and public under concept of ownership adverse against the whole world; that defendant-appellee Gregorio Araneta, Inc., sometime in the year 1958, through force and intimidation, ejected the members of the plaintiff corporation fro their possession of the aforementioned vast tract of land; that upon investigation conducted by the members and officers of plaintiff corporation, they found out for the first time in the year 1961 that the land in question "had been either fraudelently or erroneously included, by direct or constructive fraud, in Original Certificate of Title No. 466 of the Land of Records of the province of Bulacan", issued on May 11, 1916, which title is fictitious, non-existent and devoid of legal efficacy due to the fact that "no original survey nor plan whatsoever" appears to have been submitted as a basis thereof and that the Court of First Instance of Bulacan which issued the decree of registration did not acquire jurisdiction over the land registration case because no notice of such proceeding was given to the members of the plaintiff corporation who were then in actual possession of said properties; that as a consequence of the nullity of the original title, all subsequent titles derived therefrom, such as Transfer Certificate of Title No. 4903 issued in favor of Gregorio Araneta and Carmen Zaragoza, which was subsequently cancelled by Transfer Certificate of Title No. 7573 in the name of Gregorio Araneta, Inc., Transfer Certificate of Title No. 4988 issued in the name of, the National Waterworks & Sewerage Authority (NWSA), Transfer Certificate of Title No. 4986 issued in the name of Hacienda Caretas, Inc., and another transfer certificate of title in the name of Paradise Farms, Inc., are therefore void. Plaintiff-appellant consequently prayed (1) that Original Certificate of Title No. 466, as well as all transfer certificates of title issued and derived therefrom, be nullified; (2) that "plaintiff's members" be declared as absolute owners in common of said property and that the corresponding certificate of title be issued to plaintiff; and (3) that defendant-appellee Gregorio Araneta, Inc. be ordered to pay to plaintiff the damages therein specified. On September 2, 1966, defendant-appellee Gregorio Araneta, Inc. filed a motion to dismiss the amended complaint on the grounds that (1) the complaint states no cause of action; and (2) the cause of action, if any, is barred by prescription and laches. Paradise Farms, Inc. and Hacienda Caretas, Inc. filed motions to dismiss based on the same grounds. Appellee National Waterworks & Sewerage Authority did not file any motion to dismiss. However, it pleaded in its answer as special and affirmative defenses lack of cause of action by the plaintiffappellant and the barring of such action by prescription and laches. During the pendency of the motion to dismiss, plaintiff-appellant filed a motion, dated October 7, 1966, praying that the case be transferred to another branch of the Court of First Instance sitting at Malolos, Bulacan, According to defendants-appellees, they were not furnished a copy of said motion, hence, on October 14, 1966, the lower court issued an Order requiring plaintiffappellant to furnish the appellees copy of said motion, hence, on October 14, 1966, defendant-appellant's motion dated October 7, 1966 and, consequently, prayed that the said motion be denied for lack of notice and for failure of the plaintiff-appellant to comply with the Order of October 14, 1966. Similarly, defendantappellee paradise Farms, Inc. filed, on December 2, 1966, a manifestation information the court that it also did not receive a copy of the afore-mentioned of appellant. On January 24, 1967, the trial court issued an Order dismissing the amended complaint. On February 14, 1967, appellant filed a motion to reconsider the Order of dismissal on the grounds that the court had no jurisdiction to issue the Order of dismissal, because its request for the transfer of the case from the Valenzuela Branch of the Court of First Instance to the Malolos Branch of the said court has been approved by the Department of Justice; that the complaint states a sufficient cause of action because the subject matter of the controversy in one of common interest to the members of the corporation who are so numerous that the present complaint should be treated as a class suit; and that the action is not barred by the statute of limitations because (a) an action for the reconveyance of property registered through fraud does not prescribe, and (b) an action to impugn a void judgment may be brought any time. This motion was denied by the trial court in its Order dated February 22, 1967. From the afore-mentioned Order of dismissal and the Order denying its motion for reconsideration, plaintiff-appellant appealed to the Court of Appeals. On September 3, 1969, the Court of Appeals, upon finding that no question of fact was involved in the appeal but only questions of law and jurisdiction, certified this case to this Court for resolution of the legal issues involved in the controversy. I Appellant contends, as a first assignment of error, that the trial court acted without authority and jurisdiction in dismissing the amended complaint when the Secretary of Justice had already approved the transfer of the case to any one of the two branches of the Court of First Instance of Malolos, Bulacan. Appellant confuses the jurisdiction of a court and the venue of cases with the assignment of cases in the different branches of the same Court of First Instance. Jurisdiction implies the power of the court to decide a case, while venue the place of action. There is no question that respondent court has jurisdiction over the case. The venue of actions in the Court of First Instance is prescribed in Section 2, Rule 4 of the Revised Rules of Court. The laying of venue is not left to the caprice of plaintiff, but must be in accordance with the aforesaid provision of the rules. 2 The mere fact that a request for the transfer of a case to another branch of the same court has been approved by the Secretary of Justice does not divest the court originally taking cognizance thereof of its jurisdiction, much less does it change the venue of the action. As correctly observed by the trial court, the indorsement of the Undersecretary of Justice did not order the transfer of the case to the Malolos Branch of the Bulacan Court of First Instance, but only "authorized" it for the reason given by plaintiff's counsel that the transfer would be convenient for the

SULO NG BAYAN INC., plaintiff-appellant, vs. GREGORIO ARANETA, INC., PARADISE FARMS, INC., NATIONAL WATERWORKS & SEWERAGE AUTHORITY, HACIENDA CARETAS, INC, and REGISTER OF DEEDS OF BULACAN, defendants-appellees. Hill & Associates Law Offices for appellant. Araneta, Mendoza & Papa for appellee Gregorio Araneta, Inc. Carlos, Madarang, Carballo & Valdez for Paradise Farms, Inc. Leopoldo M. Abellera, Arsenio J. Magpale & Raul G. Bernardo, Office of the Government Corporate Counsel for appellee National Waterworks & Sewerage Authority. Candido G. del Rosario for appellee Hacienda Caretas, Inc.

ANTONIO, J.: The issue posed in this appeal is whether or not plaintiff corporation (non- stock may institute an action in behalf of its individual members for the recovery of certain parcels of land allegedly owned by said members; for the nullification of the transfer certificates of title issued in favor of defendants appellees covering the aforesaid parcels of land; for a declaration of "plaintiff's members as absolute owners of the property" and the issuance of the corresponding certificate of title; and for damages. On April 26, 1966, plaintiff-appellant Sulo ng Bayan, Inc. filed an accion de revindicacion with the Court of First Instance of Bulacan, Fifth Judicial District, Valenzuela, Bulacan, against defendants-appellees to recover the ownership and possession of a large tract of land in San Jose del Monte, Bulacan, containing an area of 27,982,250 square meters, more or less, registered under the Torrens System in the name of defendants-appellees' predecessors-in-interest. 1 The complaint, as amended on June 13, 1966, specifically alleged that plaintiff is a corporation organized and existing under the laws of the Philippines, with its principal office and place of business at San Jose del Monte, Bulacan; that its membership is composed of natural persons residing at San Jose del Monte, Bulacan; that the members of the plaintiff corporation, through themselves and their predecessorsin-interest, had pioneered in the clearing of the fore-mentioned tract of land, cultivated the same since the Spanish regime and

Civil Procedure Case Set 2 New Era University College of Law PERRAL
parties. The trial court is not without power to either grant or deny the motion, especially in the light of a strong opposition thereto filed by the defendant. We hold that the court a quo acted within its authority in denying the motion for the transfer the case to Malolos notwithstanding the authorization" of the same by the Secretary of Justice. II Let us now consider the substantive aspect of the Order of dismissal. In dismissing the amended complaint, the court a quo said: The issue of lack of cause of action raised in the motions to dismiss refer to the lack of personality of plaintiff to file the instant action. Essentially, the term 'cause of action' is composed of two elements: (1) the right of the plaintiff and (2) the violation of such right by the defendant. (Moran, Vol. 1, p. 111). For these reasons, the rules require that every action must be prosecuted and defended in the name of the real party in interest and that all persons having an interest in the subject of the action and in obtaining the relief demanded shall be joined as plaintiffs (Sec. 2, Rule 3). In the amended complaint, the people whose rights were alleged to have been violated by being deprived and dispossessed of their land are the members of the corporation and not the corporation itself. The corporation has a separate. and distinct personality from its members, and this is not a mere technicality but a matter of substantive law. There is no allegation that the members have assigned their rights to the corporation or any showing that the corporation has in any way or manner succeeded to such rights. The corporation evidently did not have any rights violated by the defendants for which it could seek redress. Even if the Court should find against the defendants, therefore, the plaintiff corporation would not be entitled to the reliefs prayed for, which are recoveries of ownership and possession of the land, issuance of the corresponding title in its name, and payment of damages. Neither can such reliefs be awarded to the members allegedly deprived of their land, since they are not parties to the suit. It appearing clearly that the action has not been filed in the names of the real parties in interest, the complaint must be dismissed on the ground of lack of cause of action. 3 Viewed in the light of existing law and jurisprudence, We find that the trial court correctly dismissed the amended complaint. It is a doctrine well-established and obtains both at law and in equity that a corporation is a distinct legal entity to be considered as separate and apart from the individual stockholders or members who compose it, and is not affected by the personal rights, obligations and transactions of its stockholders or members. 4 The property of the corporation is its property and not that of the stockholders, as owners, although they have equities in it. Properties registered in the name of the corporation are owned by it as an entity separate and distinct from its members. 5 Conversely, a corporation ordinarily has no interest in the individual property of its stockholders unless transferred to the corporation, "even in the case of a one-man corporation. 6 The mere fact that one is president of a corporation does not render the property which he owns or possesses the property of the corporation, since the president, as individual, and the corporation are separate similarities. 7 Similarly, stockholders in a corporation engaged in buying and dealing in real estate whose certificates of stock entitled the holder thereof to an allotment in the distribution of the land of the corporation upon surrender of their stock certificates were considered not to have such legal or equitable title or interest in the land, as would support a suit for title, especially against parties other than the corporation. 8 It must be noted, however, that the juridical personality of the corporation, as separate and distinct from the persons composing it, is but a legal fiction introduced for the purpose of convenience and to subserve the ends of justice. 9 This separate personality of the corporation may be disregarded, or the veil of corporate fiction pierced, in cases where it is used as a cloak or cover for fraud or illegality, or to work -an injustice, or where necessary to achieve equity. 10 Thus, when "the notion of legal entity is used to defeat public convenience, justify wrong, protect fraud, or defend crime, ... the law will regard the corporation as an association of persons, or in the case of two corporations, merge them into one, the one being merely regarded as part or instrumentality of the other. 11 The same is true where a corporation is a dummy and serves no business purpose and is intended only as a blind, or an alter ego or business conduit for the sole benefit of the stockholders. 12 This doctrine of disregarding the distinct personality of the corporation has been applied by the courts in those cases when the corporate entity is used for the evasion of taxes 13 or when the veil of corporate fiction is used to confuse legitimate issue of employer-employee relationship, 14 or when necessary for the protection of creditors, in which case the veil of corporate fiction may be pierced and the funds of the corporation may be garnished to satisfy the debts of a principal stockholder. 15 The aforecited principle is resorted to by the courts as a measure protection for third parties to prevent fraud, illegality or injustice. 16 It has not been claimed that the members have assigned or transferred whatever rights they may have on the land in question to the plaintiff corporation. Absent any showing of interest, therefore, a corporation, like plaintiff-appellant herein, has no personality to bring an action for and in behalf of its stockholders or members for the purpose of recovering property which belongs to said stockholders or members in their personal capacities. It is fundamental that there cannot be a cause of action 'without an antecedent primary legal right conferred' by law upon a person. 17 Evidently, there can be no wrong without a corresponding right, and no breach of duty by one person without a corresponding right belonging to some other person. 18 Thus, the essential elements of a cause of action are legal right of the plaintiff, correlative obligation of the defendant, an act or omission of the defendant in violation of the aforesaid legal right. 19 Clearly, no right of action exists in favor of plaintiff corporation, for as shown heretofore it does not have any interest in the subject matter of the case which is material and, direct so as to entitle it to file the suit as a real party in interest. III Appellant maintains, however, that the amended complaint may be treated as a class suit, pursuant to Section 12 of Rule 3 of the Revised Rules of Court. In order that a class suit may prosper, the following requisites must be present: (1) that the subject matter of the controversy is one of common or general interest to many persons; and (2) that the parties are so numerous that it is impracticable to bring them all before the court. 20 Under the first requisite, the person who sues must have an interest in the controversy, common with those for whom he sues, and there must be that unity of interest between him and all such other persons which would entitle them to maintain the action if suit was brought by them jointly. 21 As to what constitutes common interest in the subject matter of the controversy, it has been explained in Scott v. Donald 22 thus: The interest that will allow parties to join in a bill of complaint, or that will enable the court to dispense with the presence of all the parties, when numerous, except a determinate number, is not only an interest in the question, but one in common in the subject Matter of the suit; ... a community of interest growing out of the nature and condition of the right in dispute; for, although there may not be any privity between the numerous parties, there is a common title out of which the question arises, and which lies at the foundation of the proceedings ... [here] the only matter in common among the plaintiffs, or between them and the defendants, is an interest in the Question involved which alone cannot lay a foundation for the joinder of parties. There is scarcely a suit at law, or in equity which settles a Principle or applies a principle to a given state of facts, or in which a general statute is interpreted, that does not involved a Question in which other parties are interested. ... (Emphasis supplied ) Here, there is only one party plaintiff, and the plaintiff corporation does not even have an interest in the subject matter of the controversy, and cannot, therefore, represent its members or stockholders who claim to own in their individual capacities ownership of the said property. Moreover, as correctly stated by the appellees, a class suit does not lie in actions for the recovery of property where several persons claim Partnership of their respective portions of the property, as each one could alleged and prove his respective right in a different way for each portion of the land, so that they cannot all be held to have Identical title through acquisition prescription. 23

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Having shown that no cause of action in favor of the plaintiff exists and that the action in the lower court cannot be considered as a class suit, it would be unnecessary and an Idle exercise for this Court to resolve the remaining issue of whether or not the plaintiffs action for reconveyance of real property based upon constructive or implied trust had already prescribed. ACCORDINGLY, the instant appeal is hereby DISMISSED with costs against the plaintiff-appellant.

Civil Procedure Case Set 2 New Era University College of Law PERRAL
Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No. L-63559 May 30, 1986 to put them (sugarcane planters) in bad light, expose them to public ridicule, discredit and humiliation here in the Philippines and abroad, and make them objects of hatred, contempt and hostility of their agricultural workers and of the public in general. They prayed that defendants be ordered to pay them PlM as actual and compensatory damages, and such amounts for moral, exemplary and corrective damages as the court may determine, plus expenses of litigation, attorney's fees and costs of suit. A photo copy of the article was attached to the complaint. On November 5, 1981, petitioner filed a motion to dismiss on the grounds that (1) the printed article sued upon is not actionable in fact and in law; and (2) the complaint is bereft of allegations that state, much less support a cause of action. It pointed out the non-libelous nature of the article and, consequently, the failure of the complaint to state a cause of action. Private respondents filed an Opposition to the motion to dismiss and petitioner filed a reply. On March 17, 1982, the trial court denied the motion to dismiss, stating that the grounds on which the motion to dismiss are predicated are not indubitable as the complaint on its face states a valid cause of action; and the question as to whether the printed article sued upon its actionable or not is a matter of evidence. Petitioner's motion for reconsideration was denied on May 28, 1982. On June 18, 1982, petitioner filed a petition for certiorari with respondent Court (CA-G. R. No. 14406) seeking the annulment of the aforecited trial court's Orders for having been issued with such a grave abuse of discretion as amounting to lack of jurisdiction and praying for the dismissal of the complaint for failure to state a cause of action. As earlier stated, respondent Court affirmed the trial court's Orders in a Decision dated December 17, 1982 and ordered the case to be tried on the merits on the grounds that -(1) the complaint contains allegations of fact which called for the presentation of evidence; and (2) certiorari under Rule 65 cannot be made to substitute for an appeal where an appeal would lie at a proper time. Subsequently, on March 10, 1983, the respondent Court denied petitioner's Motion for Reconsideration of the aforesaid decision, hence this petition. The proper remedy which petitioner should have taken from the decision of respondent Court is an appeal by certiorari under Rule 45 of the Rules of Court and not the special civil action of certiorari and prohibition under Rule 65 of said Rules. However, since the petition was filed on time within fifteen days from notice of the Resolution denying the motion for reconsideration, we shall treat the same as a petition for review on certiorari. The two (2) issues raised in the petition are: (1) whether or not the private respondents' complaint failed to state a cause of action; and (2) whether or not the petition for certiorari and prohibition is proper to question the denial of a motion to dismiss for failure to state a cause of action. First, petitioner argues that private respondents' complaint failed to state a cause of action because the complaint made no allegation that anything contained in the article complained of regarding sugarcane planters referred specifically to any one of the private respondents; that libel can be committed only against individual reputation; and that in cases where libel is claimed to have been directed at a group, there is actionable defamation only if the libel can be said to reach beyond the mere collectivity to do damage to a specific, individual group member's reputation. We agree with petitioner. In the case of Corpus vs. Cuaderno, Sr. (16 SCRA 807) this Court ruled that "in order to maintain a libel suit, it is essential that the victim be identifiable (People vs. Monton, L-16772, November 30, 1962), although it is not necessary that he be named (19 A.L.R. 116)." In an earlier case, this Court declared that" ... defamatory matter which does not reveal the Identity of the person upon whom the imputation is cast, affords no ground of action unless it be shown that the readers of the libel could have Identified the personality of the individual defamed." (Kunkle vs. CablenewsAmerican and Lyons 42 Phil. 760). This principle has been recognized to be of vital importance, especially where a group or class of persons, as in the case at bar, claim to have been defamed, for it is evident that the larger the collectivity, the more difficult it is for the individual member to prove that the defamatory remarks apply to him. (Cf. 70 ALR 2d. 1384). In the case of Uy Tioco vs. Yang Shu Wen , 32 Phil. 624, this Court held as follows: Defamatory remarks directed at a class or group of persons in general language only, are not actionable by individuals composing the class or group unless the statements are sweeping; and it is very probable that even then no action would lie where the body is composed of so large a number of persons that common sense would tell those to whom the publication was made that there was room for persons connected with the body to pursue an upright and law abiding course and that it would be unreasonable and absurd to condemn all because of the actions of a part. (supra p. 628). It is evident from the above ruling that where the defamation is alleged to have been directed at a group or class, it is essential that the statement must be so sweeping or all-embracing as to apply to every individual in that group or class, or sufficiently specific so that each individual in the class or group can prove that the defamatory statement specifically pointed to him, so that he can bring the action separately, if need be. We note that private respondents filed a "class suit" in representation of all the 8,500 sugarcane planters of Negros Occidental. Petitioner disagrees and argues that the absence of any actionable basis in the complaint cannot be cured by the filing of a class suit on behalf of the aforesaid sugar planters.

NEWSWEEK, INC., petitioner, vs. THE INTERMEDIATE APPELLATE COURT, and NATIONAL FEDERATION OF SUGARCANE PLANTERS INC., BINALBAGAN-ISABELA PLANTERS ASSOCIATION, INC., ASOCIACION DE AGRICULTORES DE LA CARLOTA, LA CASTELLANA y PONTEVEDRA, INC., DONEDCO PLANTERS ASSOCIATION INC., ARMANDO GUSTILO, ENRIQUE ROJAS, ALFREDO MONTELIBANO, JR., PABLO SOLA, JOSE MONTALVO, VICENTE GUSTILO, JOSEPH MARANON, ROBERTO CUENCA, JOSE SICANGCO, FLORENCIO ALONSO, MIGUEL GATUSLAO, PEDRO YULO, MARINO RUBIN and BENJAMIN BAUTISTA, respondents. San Juan, Africa, Gonzales & San Agustin Law Offices for private respondents.

FERIA, J.: Petitioner, Newsweek, Inc., a foreign corporation licensed to do business in the Philippines, in this special action for certiorari, prohibition with preliminary injunction, seeks to annul the decision of the Intermediate Appellate Court dated December 17, 1982 sustaining the Order of the then Court of First Instance of Bacolod City which denied petitioner's Motion to Dismiss the complaint for libel filed by private respondents (Civil Case No. 15812), and the Resolution dated March 10, 1983 which denied its Motion for Reconsideration. It appears that on March 5, 1981, private respondents, incorporated associations of sugarcane planters in Negros Occidental claiming to have 8,500 members and several individual sugar planters, filed Civil Case No. 15812 in their own behalf and/or as a class suit in behalf of all sugarcane planters in the province of Negros Occidental, against petitioner and two of petitioners' non-resident correspondents/reporters Fred Bruning and Barry Came. The complaint alleged that petitioner and the other defendants committed libel against them by the publication of the article "An Island of Fear" in the February 23, 1981 issue of petitioner's weekly news magazine Newsweek. The article supposedly portrayed the island province of Negros Occidental as a place dominated by big landowners or sugarcane planters who not only exploited the impoverished and underpaid sugarcane workers/laborers, but also brutalized and killed them with imprunity. Complainants therein alleged that said article, taken as a whole, showed a deliberate and malicious use of falsehood, slanted presentation and/or misrepresentation of facts intended

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prohibition against the City Court of Manila and directed the respondent court to dismiss the case. In Lopez vs. City Judge (18 SCRA 616), upon the denial of a motion to quash based on lack of jurisdiction over the offense, this Court granted the petition for prohibition and enjoined the respondent court from further proceeding in the case. In Enriquez vs. Macadaeg (84 Phil. 674), upon the denial of a motion to dismiss based on improper venue, this Court granted the petition for prohibition and enjoined the respondent judge from taking cognizance of the case except to dismiss the same. In Manalo vs. Mariano (69 SCRA 80), upon the denial of a motion to dismiss based on bar by prior judgment, this Court granted the petition for certiorari and directed the respondent judge to dismiss the case. In Yuviengco vs. Dacuycuy (105 SCRA 668), upon the denial of a motion to dismiss based on the Statute of Frauds, this Court granted the petition for certiorari and dismissed the amended complaint. In Tacas vs. Cariaso (72 SCRA 527), this Court granted the petition for certiorari after the motion to quash based on double jeopardy was denied by respondent judge and ordered him to desist from further action in the criminal case except to dismiss the same. In People vs. Ramos (83 SCRA 11), the order denying the motion to quash based on prescription was set aside on certiorari and the criminal case was dismissed by this Court. Respondent Court correctly stated the general rule and its exceptions. However, it ruled that none of the exceptions is present in the case at bar and that the case appears complex and complicated, necessitating a full-blown trial to get to the bottom of the controversy. Petitioner's motion to dismiss is based on the ground that the complaint states no cause of action against it by pointing out the non-libelous nature of the article sued upon. There is no need of a trial in view of the conclusion of this Court that the article in question is not libelous. The specific allegation in the complaint, to the effect that the article attributed to the sugarcane planters the deaths and brutalization of sugarcane workers, is not borne out by a perusal of the actual text. The complaint contains a recital of the favorable working conditions of the agricultural workers in the sugar industry and the various foundations and programs supported by planters' associations for the benefit of their workers. Undoubtedly, the statements in the article in question are sweeping and exaggerated; but, paraphrasing the ruling in the Uy Tioco case above quoted, it would be unreasonable and absurd to condemn the majority of the sugarcane planters, who have at heart the welfare of their workers, because of the actions of a part. Nonetheless, articles such as the one in question may also serve to prick the consciences of those who have but are not doing anything or enough for those who do not have. On the other hand, petitioner would do well to heed the admonition of the President to media that they should check the sources of their information to ensure the publication of the truth. Freedom of the press, like all freedoms, should be exercised with responsibility. WHEREFORE, the decision of the Intermediate Appellate Court is reversed and the complaint in Civil Case No. 15812 of the Court of First Instance of Negros Occidental is dismissed, without pronouncement as to costs. SO ORDERED.

We find petitioner's contention meritorious. The case at bar is not a class suit. It is not a case where one or more may sue for the benefit of all (Mathay vs. Consolidated Bank and Trust Company, 58 SCRA 559) or where the representation of class interest affected by the judgment or decree is indispensable to make each member of the class an actual party (Borlaza vs. Polistico, 47 Phil. 348). We have here a case where each of the plaintiffs has a separate and distinct reputation in the community. They do not have a common or general interest in the subject matter of the controversy. The disputed portion of the article which refers to plaintiff Sola and which was claimed to be libelous never singled out plaintiff Sola as a sugar planter. The news report merely stated that the victim had been arrested by members of a special police unit brought into the area by Pablo Sola, the mayor of Kabankalan. Hence, the report, referring as it does to an official act performed by an elective public official, is within the realm of privilege and protected by the constitutional guarantees of free speech and press. The article further stated that Sola and the commander of the special police unit were arrested. The Court takes judicial notice of this fact. (People vs. Sola, 103 SCRA 393.) The second issue to be resolved here is whether or not the special civil action of certiorari or prohibition is available to petitioner whose motion to dismiss the complaint and subsequent motion for reconsideration were denied. As a general rule, an order denying a motion to dismiss is merely interlocutory and cannot be subject of appeal until final judgment or order is rendered. (Sec. 2 of Rule 4 1). The ordinary procedure to be followed in such a case is to file an answer, go to trial and if the decision is adverse, reiterate the issue on appeal from the final judgment. The same rule applies to an order denying a motion to quash, except that instead of filing an answer a plea is entered and no appeal lies from a judgment of acquittal. This general rule is subject to certain exceptions. If the court, in denying the motion to dismiss or motion to quash, acts without or in excess of jurisdiction or with grave abuse of discretion, then certiorari or prohibition lies. The reason is that it would be unfair to require the defendant or accused to undergo the ordeal and expense of a trial if the court has no jurisdiction over the subject matter or offense, or is not the court of proper venue, or if the denial of the motion to dismiss or motion to quash is made with grave abuse of discretion or a whimsical and capricious exercise of judgment. In such cases, the ordinary remedy of appeal cannot be plain and adequate. The following are a few examples of the exceptions to the general rule. In De Jesus vs. Garcia (19 SCRA 554), upon the denial of a motion to dismiss based on lack of jurisdiction over the subject matter, this Court granted the petition for certiorari and

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Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No. L-23326 December 18, 1965 salary for every four years of service in the government and the same shall be exempt from any tax whatsoever and shall be neither liable to attachment or execution nor refundable in case of reinstatement or re-election of the retiree. "This gratuity is payable by the employer or office concerned which is hereby authorized to provide the necessary appropriation or pay the same from any unexpended items of appropriations or savings in its appropriations or saving in its appropriations. "Elective or appointive officials and employees paid gratuity under this subsection shall be entitled to the commutation of the unused vacation and sick leave, based on the highest rate received, which they may have to their credit at the time of retirement." SECTION 2. This Act shall take effect upon its approval. Approved, June 22, 1963. The Solicitor General's Office, in representation of the respondent, filed its answer on September 8, 1964, and contends, by way of special and affirmative defenses that: 1. The grant of retirement or pension benefits under Republic Act No. 3836 to the officers objected to by the petitioner does not constitute "forbidden compensation" within the meaning of Section 14 of Article VI of the Philippine Constitution. 2. The title of the law in question sufficiently complies with the provisions of Section 21, Article VI, of the Constitution that "no bill which may be enacted into law shall embrace more than one subject which shall be expressed in the title of the bill. 3. The law in question does not constitute legislation. 4. Certain indispensable parties, specifically the elected officers of Congress who are authorized to approve vouchers for payments for funds under the law in question, and the claimants to the vouchers to be presented for payment under said items, were not included in the petition. 5. The petitioner has no standing to institute this suit. 6. The payment of commutable vacation and sick leave benefits under the said Act is merely "in the nature of a basis for computing the gratuity due each retiring member" and, therefore, is not an indirect scheme to increase their salary. A brief historical background of Republic Act No. 3836 Republic Act No. 3836 was originally House Bill No. 6051, which was introduced by Congressmen Marcial R. Pimentel of Camarines Norte and Marcelino R. Veloso of the Third District of Leyte, on May 6, 1963. On the same date, it was referred to the Committee on Civil Service. which on the following May 8,

PHILIPPINE CONSTITUTION ASSOCIATION, INC., JOSE E. ROMERO, SALVADOR ARANETA, GUILLERMO B. GUEVARA, PIO PEDROSA, CONRADO BENITEZ, JOSE M. ARUEGO, SOTERO H. LAUREL, FELIXBERTO M. SERRANO, and ROMAN OZAETA, petitioners, vs. PEDRO M. GIMENEZ, JOSE VELASCO, ELADIO SALITA and JOSE AVILES, respondents. Roman Ozaeta, Guillermo B. Guevara, Jose M. Aruego, Sotero H. Laurel and Felixberto M. Serrano for themselves and for other petitioners. Office of the Solicitor General for respondents. REGALA, J.: We are called upon in this case to decide the grave and fundamental problem of the constitutionality of Republic Act No. 3836 "insofar as the same allows retirement gratuity and commutation of vacation and sick leave to Senators and Representatives, and to the elective officials of both houses (of Congress)." The suit was instituted by the Philippine Constitution Association, Inc. (Philconsa, for short), a non-profit civic organization, duly incorporated under Philippine laws, by way of a petition for prohibition with preliminary injunction to restrain the Auditor General of the Philippines and the disbursing officers of both Houses of Congress from "passing in audit the vouchers, and from countersigning the checks or treasury warrants for the payment to any former Senator or former Member of the House of Representatives of retirement and vacation gratuities pursuant to Republic Act No. 3836; and likewise restraining the respondent disbursing officers of the House and Senate, respectively, and their successors in office from paying the said retirement and vacation gratuities." It is argued that the above-numbered Republic Act, at least to the end that it provided for the retirement of the members of Congress in the manner and terms that it did, is unconstitutional and void. The challenge to the constitutionality of the law is centered on the following propositions: 1. The provision for the retirement of the members and certain officers of Congress is not expressed in the title of the bill, in violation of section 21 (1) of Article VI of the Constitution. 2. The provision on retirement gratuity is an attempt to circumvent the Constitutional ban on increase of salaries of the members of Congress during their term of office, contrary to the provisions of Article VI, Section 14 of the Constitution.

3. The same provision constitutes "selfish class legislation" because it allows members and officers of Congress to retire after twelve (12) years of service and gives them a gratuity equivalent to one year salary for every four years of service, which is not refundable in case of reinstatement or re-election of the retiree, while all other officers and employees of the government can retire only after at least twenty (20) years of service and are given a gratuity which is only equivalent to one month salary for every year of service, which, in any case, cannot exceed 24 months. 4. The provision on vacation and sick leave, commutable at the highest rate received, insofar as members of Congress are concerned, is another attempt of the legislators to further increase their compensation in violation of the Constitution. The text of Republic Act No. 3836 The text of Republic Act No. 3836 reads: AN ACT AMENDING SUBSECTION (c), SECTION TWELVE OF COMMONWEALTH ACT NUMBERED ONE HUNDRED EIGHTY-SIX, AS AMENDED BY REPUBLIC ACT NUMBERED THIRTY HUNDRED NINETY-SIX: Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled: SECTION 1. Subsection (c), Section twelve of Commonwealth Act Numbered One Hundred eighty-six, as amended by Republic Act Numbered Thirty hundred ninety-six, is further amended to read as follows: "(c) Retirement is likewise allowed to a member, regardless of age, who has rendered at least twenty years of service. The benefit shall, in addition to the return of his personal contributions plus interest and the payment of the corresponding employer's premiums described in subsection (a) of Section five hereof, without interest, be only a gratuity equivalent to one month's salary for every year of service, based on the highest rate received, but not to exceed twenty-four months: Provided, That the retiring officer or employee has been in the service of the said employer or office for at least four years immediately preceding his retirement. "Retirement is also allowed to a senator or a member of the House of Representatives and to an elective officer of either House of the Congress, regardless of age, provided that in the case of a Senator or Member, he must have served at least twelve years as a Senator and/or as a member of the House of Representatives, and, in the case of an elective officer of either House, he must have served the government for at least twelve years, not less than four years of which must have been rendered as such elective officer: Provided, That the gratuity payable to a retiring senator, member of the House of Representatives, or elective officer, of either House, shall be equivalent to one year's

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submitted its REPORT No. 3129, recommending approval of the bill with amendments, among others, that the word "TWENTY" in the bill as filed representing the number of years that a senator or member must serve in Congress to entitle him to retirement under the bill must be reduced to "TWELVE" years, and that the following words were inserted, namely, "AND THE SAME (referring to gratuity) SHALL BE EXEMPT FROM ANY TAX WHATSOEVER AND SHALL NOT BE LIABLE FROM ATTACHMENT OR EXECUTION NOR REFUNDABLE IN CASE OF REINSTATEMENT OR REELECTION OF THE RETIREE." On May 8, 1963, the bill with the proposed amendments was approved on second reading. It was passed on third reading on May 13, 1963, and on the same day was sent to the Senate, which, in turn, on May 23, 1963, passed it without amendment. The bill was finally approved on June 22, 1963. As explained in the EXPLANATORY NOTE attached to the bill, among others The inclusion of members of Congress in subsection (c), Section 12 of C.A. 186, as amended, will enable them to retire voluntarily, regardless of age, after serving a minimum of twenty years as a Member of Congress. This gratuity will insure the security of the family of the retiring member of Congress with the latter engaging in other activities which may detract from his exalted position and usefulness as lawmaker. It is expected that with this assurance of security for his loved ones, deserving and well-intentioned but poor men will be attracted to serve their people in Congress. As finally approved, the law (Subsection [c], paragraph 2, Section 1, R.A. 3836) allows a Senator or a Member of the House of Representatives and an elective officer of either House of Congress to retire regardless of age. To be eligible for retirement, he must have served for at least twelve years as such Senator and/or as member of the House of Representatives. For an elective officer of either House, he must have served the government for at least twelve years, of which not less than four years must have been rendered as such elective officer. The gratuity payable by the employer or office concerned is equivalent to one year's salary for every four years of service in the government. Said gratuity is exempt from taxation, not liable to attachment or execution, and not refundable in case of reinstatement or re-election of the retiree. First legal point personality of the Petitioner to bring suit. The first point to be considered is whether petitioner Philconsa has a standing to institute this action. This Court has not hesitated to examine past decisions involving this matter. This Court has repeatedly held that when the petitioner, like in this case, is composed of substantial taxpayers, and the outcome will affect their vital interests, they are allowed to bring this suit. (Pascual v. Secretary, G.R. No. L-10405, December 29, 1960; and Gonzales v. Hechanova, 60 Off. Gaz. 802 [1963]). The petitioner, Philconsa, is precisely a non-profit, civic organization composed of several leaders from all walks of life whose main objective is to uphold the principles of the Constitution. In rejecting the motion to dismiss in the case of Pascual v. Secretary, supra, this Court stated, among other things, that "there are many decisions nullifying, at the instance of the taxpayers, laws providing the disbursement of public funds, upon the theory that the expenditure of public funds by an officer of the State for the purpose of administering an unconstitutional act constitutes a misappropriation of such funds, which may be enjoined at the request of the taxpayers."1 This legislation (Republic Act 3836) involves the disbursement of public funds. We are not, however, unmindful of the ruling laid down by the Supreme Court of the United States in the case of Massachusetts v. Mellon, 262 U.S. 447, holding that: ... the relation of a taxpayer of the United States to the Federal Government is very different. His interest in the moneys of the Treasury partly realized from taxation and partly from other sources is shared with millions of others; is comparatively minute and indeterminable; and the effect upon future taxation of any payment out of the funds, so remote, fluctuating and uncertain, that no basis is afforded for an appeal to the preventive powers of equity. The general view in the United States, which is followed here, is stated in the American Jurisprudence, thus In the determination of the degree of interest essential to give the requisite standing to attack the constitutionality of a statute the general rule is that not only persons individually affected, but also taxpayers have sufficient interest in preventing the illegal expenditure of moneys raised by taxation and may therefore question the constitutionality of statutes requiring expenditure of public moneys. (11 Am. Jur. 761; emphasis supplied.) As far as the first point is concerned, We hold, therefore, that the contention of the Solicitor General is untenable. Second legal point Whether or not Republic Act No. 3836 falls within the prohibition embodied in Art. VI, section 14 of the Constitution. The first constitutional question is whether Republic Act 3836 violates Section 14, Article VI, of the Constitution, which reads as follows: The senators and the Members of the House of Representatives shall, unless otherwise provided by law, receive an annual compensation of seven thousand two hundred pesos each, including per diems and other emoluments or allowances, and exclusive only of travelling expenses to and from their respective districts in the case of Members of the House of Representative and to and from their places of residence in the case of Senators, when attending sessions of the Congress. No increase in said compensation shall take effect until after the expiration of the full term of all the Members of the Senate and of the House of Representatives approving such increase. Until otherwise provided by law, the President of the Senate and the Speaker of the House of Representatives shall each receive an annual compensation of sixteen thousand pesos (emphasis supplied) Before discussing this point, it is worthy to note that the Constitution embodies some limitations and prohibitions upon the members of Congress, to wit: 1. They may not hold any other office or employment in the Government without forfeiting their respective seats; 2. They shall not be appointed, during the time for which they are elected, to any civil office which may have been created or the emoluments whereof shall have been increased while they were members of Congress; (Section 16, Article VI, Constitution) 3. They cannot be financially interested in any franchise; 4. They cannot appear in any civil case wherein the Government is an adverse party; 5. They cannot appear as counsel before any Electoral Tribunal; and 6. They cannot appear as counsel in any criminal case where an officer or employee of the Government is accused. (Section 17, Article VI, Constitution) In addition to the above prohibitions, the Anti-Graft Law (Republic Act 3019) also prohibits members of Congress to have any special interest in any specific business which will directly or indirectly be favored by any law or resolution authored by them during their term of office. It is thus clear that the Constitutional Convention wisely surrounded the Constitution with these limitations and prohibitions upon Members of Congress. This is a practical demonstration or application of the principle of the and balances which is one of the peculiar characteristics of our Constitution. In the light of this background, can We conclude that Congress can validly enact Republic Act 3836, providing retirement benefits to its members, without violating the provisions in the aforementioned Article VI, Section 14, of the Constitution, regarding increase of the compensation act including other emoluments? It is worthy to note that the original salary for the members of the National Assembly (unicameral body) was fixed at P5,000.00 per annum each. This was raised to P7,200 per annum by the enactment of the 1940 Constitutional amendment, when the unicameral body, the National Assembly, was changed to Congress, composed of two bodies, the Senate and the House of Representatives. Again, in 1964, by the enactment of Republic Act 4143, the salary for the Members of Congress was raised to P32,000.00 per annum for each of them; and for the President of

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the Senate and the Speaker of the House of Representatives, to P40,000.00 per annum each. Likewise, it is significant that, as stated above, when the Constitutional Convention first determined the compensation for the Members of Congress, the amount fixed by it was only P5,000.00 per annum, but it embodies a special proviso which reads as follows: "No increase in said compensation shall take effect until after the expiration of the full term of all the members of the National Assembly elected subsequent to approval of such increase." In other words, under the original constitutional provision regarding the power of the National Assembly to increase the salaries of its members, no increase would take effect until after the expiration of the full term of the members of the Assembly elected subsequent to the approval of such increase. (See Aruego, The Framing of the Constitution, Vol. 1, pp. 296-300; Sinco, Philippine Government and Political Law, 4th ed., p. 187) This goes to show how zealous were the members of the Constitutional Convention in guarding against the temptation for members of Congress to increase their salaries. However, the original strict prohibition was modified by the subsequent provision when the Constitutional amendments were approved in 19402 The Constitutional provision in the aforementioned Section 14, Article VI, includes in the term compensation "other emoluments." This is the pivotal point on this fundamental question as to whether the retirement benefits as provided for in Republic Act 3836 fall within the purview of the term "other emoluments." Most of the authorities and decided cases have regarded "emolument" as "the profit arising from office or employment; that which is received as compensation for services or which is annexed to the possession of an office, as salary, fees and perquisites.3 In another set of cases, "emolument" has been defined as "the profit arising from office or employment; that which is received as compensation for services, or which is annexed to the possession of office, as salary, fees and perquisites; advantage, gain, public or private." The gain, profit or advantage which is contemplated in the definition or significance of the word "emolument" as applied to public officers, clearly comprehends, We think, a gain, profit, or advantage which is pecuniary in character. (citing Taxpayers' League of Cargon County v. McPherson, 54 P. 2d. 897, 90l.: 49 Wy. 26; 106 A.L.R. 767) In Schieffelin v. Berry, 216 N.Y.S. (citing Wright v. Craig, 202 App. Div. 684, 195 N.Y.S. 391, affirmed 234 N.Y. 548, 138 N.E. 441), it has been established that pensions and retirement allowances are part of compensation of public officials; otherwise their payment would be unconstitutional. In another case, State v. Schmahl, 145 N.W. 795, 125 Minn. 104, it is stated that "as used in Article 4, section 9, of the Constitution of Minnesota, providing that no Senator or Representative shall hold any office, the emoluments of which have been increased during the session of the Legislature of which he was a member, until after the expiration of his term of office in the Legislature, the word "emoluments" does not refer to the fixed salary alone, but includes fees and compensation as the incumbent of the office is by law entitled to receive because he holds such office and performed some service required of the occupant thereof." From the decisions of these cases, it is evident that retirement benefit is a form or another species of emolument, because it is a part of compensation for services of one possessing any office. Republic Act No. 3836 provides for an increase in the emoluments of Senators and Members of the House of Representatives, to take effect upon the approval of said Act, which was on June 22, 1963. Retirement benefits were immediately available thereunder, without awaiting the expiration of the full term of all the Members of the Senate and the House of Representatives approving such increase. Such provision clearly runs counter to the prohibition in Article VI, Section 14 of the Constitution. Third Legal Point Whether or not the law in question violates the equal protection clause of the Constitution. Another reason in support of the conclusion reached herein is that the features of said Republic Act 3836 are patently discriminatory, and therefore violate the equal protection clause of the Constitution. (Art. III, Sec. 1, part. 1.) In the first place, while the said law grants retirement benefits to Senators and Members of the House of Representatives who are elective officials, it does not include other elective officials such as the governors of provinces and the members of the provincial boards, and the elective officials of the municipalities and chartered cities. The principle of equal protection of law embodied in our Constitution has been fully explained by Us in the case of People v. Vera, 65 Phil. 56, 126, where We stated that the classification to be reasonable must be based upon substantial distinctions which make real differences and must be germane to the purposes of the law. As well stated by Willoughby on the Constitution of the United States (second edition), p. 1937, the principle of the requirement of equal protection of law applies to all persons similarly situated. Why limit the application of the benefits of Republic Act 3836 to the elected members of Congress? We feel that the classification here is not reasonable. (See also Sinco, Philippine Political Law, 11th ed. [1962]; Selected Essays on Constitutional Law [193862], p. 789; The Equal Protection of the Laws, 37 Cal. Law Rev. 341.) Secondly, all members of Congress under Republic Act 3836 are given retirement benefits after serving twelve years, not necessarily continuous, whereas, most government officers and employees are given retirement benefits after serving for at least twenty years. In fact, the original bill of Act 3836 provided for twenty years of service. In the third place, all government officers and employees are given only one retirement benefit irrespective of their length of service in the government, whereas, under Republic Act 3836, because of no age limitation, a Senator or Member of the House of Representatives upon being elected for 24 years will be entitled to two retirement benefits or equivalent to six years' salary. Also, while the payment of retirement benefits (annuity) to an employee who had been retired and reappointed is suspended during his new employment (under Commonwealth Act 186, as amended), this is not so under Republic Act 3836. Lastly, it is peculiar that Republic Act 3836 grants retirement benefits to officials who are not members of the Government Service Insurance System. Most grantees of retirement benefits under the various retirement laws have to be members or must at least contribute a portion of their monthly salaries to the System.4 The arguments advanced against the discriminatory features of Republic Act 3836, as far as Members of Congress are concerned, apply with equal force to the elected officers of each House, such as the Secretaries and the Sergeants-at-arms. Under Republic Act 3836, the Secretaries and Sergeants-at-arms of each House are given the benefits of retirement without having served for twenty years as required with other officers and employees of the Government. Fourth Legal Point Whether or not the title of Republic Act No. 3836 is germane to the subject matter expressed in the act. Another Constitutional point to determine is whether the title of Republic Act 3836 complies with the requirement of paragraph 1, section 21, Article VI of the Constitution, which reads as follows: No bill which may be enacted into law shall embrace more than one subject which shall be expressed in the title of the bill. We are not unmindful of the fact that there has been a general disposition in all courts to construe the constitutional provision with reference to the subject and title of the Act, liberally. It is the contention of petitioner that the said title of Republic Act 3836 gives no inkling or notice whatsoever to the public regarding the retirement gratuities and commutable vacation and sick leave privileges to members of Congress. It is claimed that petitioner learned of this law for the first time only when Jose Velasco, disbursing officer of the House, testified on January 30, 1964, before Justice Labrador, in connection with the hearing of

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the case, and he revealed that in 1963, Congress enacted the retirement law for its members. In fact the Appropriation Act for the fiscal year 1964-65, Republic Act No. 4164, provides: 13. For payment of retirement gratuities of members of the Senate pursuant to the provisions of Republic Act No. 3836: PROVIDED, That no portion of this Appropriation shall be transferred to any other item until all approved claims shall have been paid P210,000.00. In the appropriations for the House of Representatives the following items appear: 7. For government share of premiums on life insurance and retirement of Members and employees of the House of Representatives, as provided for under Republic Act No. 1616 P300,000.00 8. For payment of the cash commutation of the accumulated vacation and sick leaves as provided for under Republic Act No. 611, and retirement gratuities of Members and employees of the House of Representatives under Republic Act No. 1616 P1,300,000.00. In the Appropriations Act of 1965-1966 (Republic Act No. 4642), the following item appears in the appropriations for the Senate: 13. For payment of retirement gratuities of Senate personnel pursuant to the provisions of Republic Act No. 1616: PROVIDED, That no portion of this appropriation shall be transferred to any other item until all approved claims shall have been paid P100,000.00. It is thus clear that in the Appropriations Act for 1965-1966, the item in the Senate for P210,000.00 to implement Republic Act 3836 was eliminated. In the appropriations for the House (1965-1966), the following items appear: 7. For government share of premiums on life insurance and retirement of Members and employees of the House Of Representatives as provided for under Republic Act No. 1616 P1,200,000.00. 8. For payment of the cash commutation of the accumulated vacation and sick leaves as provided for under Republic Act No. 611, and retirement gratuities of Members and employees of the House of Representatives under Republic Act No. 1616 P1,700,000.00. It is to be observed that under Republic Act 3836, amending the first paragraph of section 12, subsection (c) of Commonwealth Act 186, as amended by Republic Acts Nos. 660 and. 3096, the retirement benefits are granted to members of the Government Service Insurance System, who have rendered at least twenty years of service regardless of age. This paragraph is related and germane to the subject of Commonwealth Act No. 186. On the other hand, the succeeding paragraph of Republic Act 3836 refers to members of Congress and to elective officers thereof who are not members of the Government Service Insurance System. To provide retirement benefits, therefore, for these officials, would relate to subject matter which is not germane to Commonwealth Act No. 186. In other words, this portion of the amendment (re retirement benefits for Members of Congress and elected officers, such as the Secretary and Sergeants-at-arms for each House) is not related in any manner to the subject of Commonwealth Act 186 establishing the Government Service Insurance System and which provides for both retirement and insurance benefits to its members. Parenthetically, it may be added that the purpose of the requirement that the subject of an Act should be expressed in its title is fully explained by Cooley, thus: (1) to prevent surprise or fraud upon the Legislature; and (2) to fairly apprise the people, through such publication of legislation that are being considered, in order that they may have the opportunity of being heard thereon by petition or otherwise, if they shall so desire (Cooley, Constitutional Limitations, 8th ed., Vol. 1, p. 162; See also Martin, Political Law Reviewer, Book One [1965], p. 119) With respect to sufficiency of title this Court has ruled in two cases: The Constitutional requirement with respect to titles of statutes as sufficient to reflect their contents is satisfied if all parts of a law relate to the subject expressed in its title, and it is not necessary that the title be a complete index of the content. (People v. Carlos, 78 Phil. 535) The Constitutional requirement that the subject of an act shall be expressed in its title should be reasonably construed so as not to interfere unduly with the enactment of necessary legislation. It should be given a practical, rather than technical, construction. It should be a sufficient compliance with such requirement if the title expresses the general subject and all the provisions of the statute are germane to that general subject. (Sumulong v. The Commission on Elections, 73 Phil. 288, 291) The requirement that the subject of an act shall be expressed in its title is wholly illustrated and explained in Central Capiz v. Ramirez, 40 Phil. 883. In this case, the question raised was whether Commonwealth Act 2784, known as the Public Land Act, was limited in its application to lands of the public domain or whether its provisions also extended to agricultural lands held in private ownership. The Court held that the act was limited to lands of the public domain as indicated in its title, and did not include private agricultural lands. The Court further stated that this provision of the Constitution expressing the subject matter of an Act in its title is not a mere rule of legislative procedure, directory to Congress, but it is mandatory. It is the duty of the Court to declare void any statute not conforming to this constitutional provision. (See Walker v. State, 49 Alabama 329; Cooley, Constitutional Limitations, pp. 162-164;5 See also Agcaoili v. Suguitan, 48 Phil. 676; Sutherland on Statutory Construction, Sec. 111.) In the light of the history and analysis of Republic Act 3836, We conclude that the title of said Republic Act 3836 is void as it is not germane to the subject matter and is a violation of the aforementioned paragraph 1, section 21, Article VI of the Constitution. In short, Republic Act 3836 violates three constitutional provisions, namely: first, the prohibition regarding increase in the salaries of Members of Congress; second, the equal protection clause; and third, the prohibition that the title of a bill shall not embrace more than one subject. IN VIEW OF THE FOREGOING CONSIDERATIONS, Republic Act No. 3836 is hereby declared null and void, in so far as it refers to the retirement of Members of Congress and the elected officials thereof, as being unconstitutional. The restraining order issued in our resolution on December 6, 1965 is hereby made permanent. No costs. Bengzon, C.J., Bautista Angelo, Concepcion, Reyes, J.B.L., Dizon, Makalintal, Bengzon, J.P. and Zaldivar, JJ., concur. Barrera, J., took no part.

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Republic of the Philippines SUPREME COURT Manila SECOND DIVISION G.R. No. L-45809 December 12, 1986 On January 13, 1976, the respondent trial judge issued three orders. The first order substituted the heirs of the deceased defendant, namely, his thirteen children and surviving spouse, as defendants; the second order authorized Atty. Teodoro Almase, counsel for the plaintiff, to present his evidence in the absence of Attys. Antigua and Branzuela and the third order treated the case submitted for decision, after the plaintiff had presented his evidence and rested his case, and directed that said counsels and the fourteen heirs of the deceased defendant be furnished copies thereof. On January 28, 1976, the respondent trial judge rendered a decision against the heirs of the deceased defendant. On February 19, 1976, ten of the children of the deceased defendant, who apparently did not know that a decision had already been rendered, filed an Answer in-substitution of the deceased defendant through their counsel Atty. Jesus Yray. This was denied admission by the respondent trial judge for being already moot and academic because of the earlier decision. On March 9, 1976, the widow and two other children of the deceased defendant, through their counsel Atty. Delfin Quijano, filed a motion for substitution and for reconsideration of the decision dated January 28, 1976. On April 7, 1976, the respondent trial judge issued an order setting aside his decision and setting the case in the calendar for cross-examination of the plaintiff, Pacifico Pelaez, with a proviso that said order was applicable only to the three heirs who had filed the motion. On July 14, 1976, the respondent trial judge lifted the order setting aside his decision, despite the verbal petition for postponement of the hearing made by one of the three heirs on the ground of the absence of their counsel. On July 9, 1976, petitioner, who had been appointed judicial administratrix of the estate of the deceased defendant and who was one of the heirs who had filed an Answer on February 19, 1976, filed a motion to intervene and/or substitute the deceased defendant. On August 25, 1976, the respondent trial judge denied the motion for the reason that the decision had already become final. Petitioner then filed a special civil action of certiorari with the Court of Appeals to annul the proceedings in the respondent trial court. However, the Court of Appeals dismissed the petition for certiorari. Hence, the present appeal. The appeal is meritorious. Section 16 of Rule 3 provides as follows: Duty of attorney upon death, incapacity, or incompetency of party. Whenever a party to a pending case dies, becomes incapacitated or incompetent, it shall be the duty of his attorney to inform the court promptly of such death, incapacity or incompetency, and to give the name and residence of his executor, administrator, guardian or other legal representative.

SOCORRO SEPULVEDA LAWAS, petitioner, vs. COURT OF APPEALS, HON. BERNARDO LL. SALAS, [as Judge, CFI, Cebu, Branch VIII], and PACIFICO PELAEZ, respondents. Jesus Yray for petitioner. Teodoro Almase for respondents. FERIA, J.: This is an appeal by certiorari under Rule 45 of the Revised Rules of Court from the decision of the Court of Appeals which dismissed the petition for certiorari under, Rule 65 of said Rules against respondent Judge Bernardo L. Salas of the Court of First Instance of Cebu. The antecedent facts are briefly as follows: Private respondent Pacifico Pelaez filed a Complaint on December 6, 1972 against petitioner's father, Pedro Sepulveda, for ownership and partition of certain parcels of land. Defendant Pedro Sepulveda filed his Answer dated December 31, 1972 resisting the claim and raising the special defenses of laches, prescription and failure to ventilate in a previous special proceeding. During the presentation of evidence for the plaintiff, the defendant died on March 25, 1975. On May 21, 1975, counsels for the deceased defendant filed a notice of death wherein were enumerated the thirteen children and surviving spouse of the deceased. On May 5, 1975, petitioner filed a petition for letters of administration and she was appointed judicial administratrix of the estate of her late father in July, 1976. At the hearing of the case on November 27, 1975, Attys. Domingo Antigua and Serafin Branzuela, former counsels for the deceased defendant, manifested in open court that with the death of their client, their contract with him was also terminated and none of the thirteen children nor the surviving spouse had renewed the contract, but instead they had engaged the services of other lawyers in the intestate proceedings. Notwithstanding the manifestation of the former counsels of the deceased defendant, the respondent trial judge set the case for hearing on January 13, 1976 and sent the notice of hearing to said counsels.

The former counsels for the deceased defendant, Pedro Sepulveda, complied with this rule by filing a notice of death on May 21, 1975. They also correctly manifested in open court at the hearing of the case on November 27, 1975, that with the death of their client their contract with him was also terminated and none of the heirs of the deceased had renewed the contract, and the heirs had instead engaged the services of other lawyers in the intestate proceedings. Both the respondent trial judge and the Court of Appeals erred in considering the former counsels of the deceased defendant as counsels for the heirs of the deceased. The statement in the decision of the Court of Appeals that "the appearance of the lawyers of their deceased father in court on January 13, 1976 (Annex K) carries the presumption that they were authorized by the heirs of the deceased defendant" is erroneous. As this Court held in People vs. Florendo (77 Phil. 16), "the attorneys for the offended party ceased to be the attorneys for the deceased upon the death of the latter, the principal. " Moreover, such a presumption was not warranted in view of the manifestation of said lawyers in open court on November 27, 1975 that they were not representing the heirs of the deceased defendant. Consequently, when on the same date, November 27, 1975, the respondent trial judge issued an order setting the continuation of the trial of the case on January 13, 1976, with notices sent to Atty. Almase for the plaintiff and Attys. Antigua and Branzuela for the deceased defendant, he acted with grave abuse of discretion amounting to excess of jurisdiction. It was only at the hearing on January 13, 1976 that the respondent trial judge issued an order substituting the deceased defendant with his fourteen heirs. This was followed with an order authorizing counsel for the plaintiff to present his evidence in the absence of Attys. Antigua and Branzuela, and lastly, an order treating the case as submitted for decision. In the order of the respondent trial judge dated November 10, 1976, denying petitioner's motion for reconsideration of the order denying her motion for intervention (Annex 1 of the Comment), mention was made of the delayed arrival of Attys. Antigua and Branzuela at the hearing on January 13, 1976 and of their being allowed to cross-examine the plaintiff himself. The refusal of said former counsels of the deceased defendant to cross-examine the plaintiff was justified ... in view of the intervening event of appellant's death and the interposition of the equally established principle that the relationship of attorney and client is terminated by the death of the client, as acknowledged by respondent court itself as well as respondents. In the absence of a retainer from the heirs or authorized representatives of his deceased defendant the attorney would have no further power or authority to appear or take any further action in the case, save to inform the court of the client's death and take the necessary steps to safeguard the

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decedent's rights in the case. (Vda. de Haberer vs. Court of Appeals, May 26, 1981, 104 SCRA 534, 540) Moreover, as above stated, petitioner had as early as May 5, 1975 filed a petition for letters of administration, and the same was granted in July, 1975. Section 17 of Rule 3 provides as follows: Death of party. After a party dies and the claim is not thereby extinguished, the court shag order, upon proper notice, the legal representative of the deceased to appear and to be substituted for the deceased, within a period of thirty (30) days, or within such time as may be granted. If the legal representative fails to appear within said time, the court may order the opposing party to procure the appointment of a legal representative of the deceased within a time to be specified by the court, and the representative shall immediately appear for and on behalf of the interest of the deceased. The court charges involved in procuring such appointment, if defrayed by the opposing party, may be recovered as costs. The heirs of the de ceased may be allowed to be substituted for the deceased, without requiring the appointment of an executor or administrator and the court may appoint guardian ad litem for the minor heirs. As this Court has held: ... Under the Rule, it is the court that is called upon, after notice of a party's death and the claim is not thereby extinguished, to order upon proper notice the legal representative of the deceased to appear within a period of 30 days or such time as it may grant. Since no administrator of the estate of the deceased appellant had yet been appointed as the same was still pending determination in the Court of First Instance of Quezon City, the motion of the deceased's counsel for the suspension of the running of the period within which to file appellant's brief was well-taken. More, under the Rule, it should have set a period for the substitution of the deceased party with her legal representative or heirs, failing which, the court is called upon to order the opposing party to procure the appointment of a legal representative of the deceased at the cost of the deceased's estate, and such representative shall then 'immediately appear for and on behalf of the interest of the deceased. Respondent court gravely erred in not following the Rule and requiring the appearance of the legal representative of the deceased and instead dismissing the appeal of the deceased who yet had to be substituted in the pending appeal Thus, it has been held that when a party dies in an action that survives, and no order is issued by the court for the appearance of the legal representative or of the heirs of the deceased in substitution of the deceased, and as a matter of fact no such substitution has ever been effected, the trial held by the court without such legal representatives or heirs and the judgment rendered after such trial are null and void because the court acquired no jurisdiction over the persons of the legal representatives or of the heirs upon whom the trial and the judgment would be binding. (Ordoveza vs. Raymundo, 63 Phil 275 [1936]; Obut vs. Court of Appeals, et al., 70 SCRA 546) (Vda. de Haberer vs. Court of Appeals, supra, p. 541. Under the said Rule, priority is given to the legal representative of the deceased, that is, the executor or administrator of his estate. It is only in cases of unreasonable delay in the appointment of an executor or administrator, or in cases where the heirs resort to an extrajudicial settlement of the estate, that the court may adopt the alternative of allowing the heirs of the deceased to be substituted for the deceased. In the case at bar, in view of the pendency of Special Proceeding No. 37-SF Intestate Estate of Pedro Sepulveda, and the pending application of petitioner to be appointed judicial administratrix of the estate, the respondent trial judge should have awaited the appointment of petitioner and granted her motion to substitute the deceased defendant. While the lower courts correctly held that the death of Pedro Sepulveda did not obliterate his verified Answer to the Complaint filed by private respondent and that the Answer filed by the ten heirs and the Answer filed by the Administratrix were both unnecessary, the said heirs or the administratrix could, with leave of court, file an Amended Answer. In view of the foregoing, the Court rules that the proceedings conducted by the respondent trial judge after the death of the deceased defendant are null and void. WHEREFORE, the decision of the Court of Appeals is reversed; the petition for certiorari is granted; petitioner is ordered substituted for the deceased defendant, Pedro Sepulveda; and the proceedings conducted by the respondent trial judge after the death of the deceased defendant, including the decision rendered by him on January 28, 1976, are set aside; with costs against private respondent. SO ORDERED.

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Republic of the Philippines SUPREME COURT Manila FIRST DIVISION G.R. No. L-60544 May 19, 1984 Defendant William Vasquez denied his being a squatter in the subject parcel of land. He alleged that he had been in continuous, open, adverse and actual possession and occupation of the lot since 1950. He also questioned the city court's jurisdiction over the subject matter of the action stating that the facts alleged in the complaint involved questions of title or ownership of the lot, matters outside the jurisdiction of the respondent court. He further questioned the qualifications of Salindon to purchase the disputed lot from the PHHC, as she was the owner of several other registered real estate properties and an outsider in so far as the lot was concerned. On March 12, 1971, defendant Silverio Nicolas died. He was substituted by his wife Erlinda who filed an amended answer with third party complaint against PHHC. In his answer, Nicolas had denied that he was a squatter on the lot. He alleged that lie had been a possessor and occupant of a piece of residential lot located at Malaya Avenue, continuously, openly, publicly and adverse to any other claimant and under concept of an owner for more than ten years. Like defendant Vasquez, he also questioned the jurisdiction of the respondent court over the subject matter of the action and the qualifications of Salindon to purchase the subject parcel of land. Third-Party defendant PHHC admitted the sale of the disputed land to Adela Salindon. According to PHHC, the award of the lot to Salindon was a valid exercise of the PHHCs powers and could not be collaterally assailed the illegal acts of the defendants could not ripen into legal ones; the defendants being squatters have not acquired any vested right over the property and that, since the subject lot is not a relocation area intended for squatters, the defendants can not claim preference in the award of the lot. The PHHC also questioned the jurisdiction of the city court over the third party complaint on the following grounds: (1) cancellation of the deed of sale executed in favor of Salindon amounts to an action for rescission of contract which falls within the original and exclusive jurisdiction of the Court of First Instance; and (2) the action involves title or possession of real property, hence the action against PHHC should be dismissed for lack of jurisdiction. After trial on the merits, the respondent court issued a decision in favor of the defendants. The dispositive portion of the decision reads: WHEREFORE, this Court renders judgment in favor of the defendants and against the plaintiff as follows: (1) declaring the conditional and the absolute deeds of sale executed by the PHHC in favor of the plaintiff Adela Salindon as null and void; and (2) ordering the PHHC to award the lot in litigation to the defendant William Vasquez and Erlinda Nicolas and, upon payment by said defendants of the total consideration within 30 days from notice of this decision, to execute the corresponding deed of absolute sale in their favor. On August 25, 1975 Adela Salindon appealed the aforequoted decision to the Court of Appeals. On December 11, 1976, Salindon died. There was, however, no substitution of party, hence Salindon continued to be the appellant in the appealed case. On March 21, 1977 the case was remanded to the city court for the retaking of testimony which could not be considered because the stenographic notes could not be transcribed. The deceased Salindon continued to be an adverse party. Meanwhile, after Salindon's death, her heirs settled her estate and the subject lot was transferred with a new Transfer Certificate of Title to the petitioners. On July 31, 1980 the Court of Appeals issued a Resolution ordering plaintiff-appellant Salindon to show cause why her appeal should not be dismissed. On December 4, 1980, the Court of Appeals issued another Resolution dismissing the appeal for having been abandoned. On August 3, 1981, respondent court issued a writ of execution to enforce the decision. On November 7, 1981, respondent General Manager Gaudencio Tobias of the National Housing Authority (hereinafter referred as NHA), successor to the powers and functions of the PHHC, wrote a letter to private respondents informing them that the NHA was ready to implement the decision and suggesting that in order to avoid delay, they secure an order directing the Registrar of Deeds of Quezon City to cancel Transfer Certificate of Title No. 239729. On February 16, 1982 respondent William Vasquez filed a motion for the issuance of an order directing the Quezon City Register of Deeds to cancel TCT No. 138007 in the name of Adela Salindon and TCT No. 239729, in the name of petitioners. A similar motion was filed by respondent Erlinda Nicolas. On March 19, 1982, petitioner Arsenio Florendo, Jr., filed a manifestation and opposition to the motions for cancellation alleging that the court has no jurisdiction to order the cancellation of the titles Hence, the instant petition. Considering the circumstances of the case, a preliminary issue surfaces as to the status of the decision vis-a-vis the petitioners. The petitioners challenge the proceeding in the Court of Appeals after the death of the plaintiff-appellant Adela Salindon. They are of the opinion that since there was no legal representative substituted for Salindon after her death, the appellate court lost its jurisdiction over the case and consequently, the proceedings in the said court are null and void. This argument is without merit. There is no dispute that an ejectment case survives the death of a party. The supervening death of plaintiff-appellant Salindon did not extinguish her civil personality (Republic v. Bagtas, 6 SCRA

ARSENIO FLORENDO, JR., MILAGROS FLORENDO and BEATRIZ FLORENDO, petitioners, vs. HON. PERPETUA D. COLOMA, Presiding Judge of Branch VII, City Court of Quezon City; GAUDENCIO TOBIAS, General Manager, National Housing Authority; Registrar of Deeds for Quezon City; WILLIAM R. VASQUEZ and ERLINDA NICOLAS, respondents. Emilio A. de Peralta for petitioners. Byron S. Anastacio for respondent Vasquez. Emilio Purunganan for respondent Nicolas.

GUTIERREZ, JR., J.: In this petition for certiorari with preliminary injunction, the petitioners seek the annulment of: (1) the May 20, 1975 decision of the respondent court in Civil Case No. VII-17952 for ejectment entitled Adela Salindon v. William Vasquez and Silverio Nicolas; (2) the August 3, 1981 writ of execution issued by the respondent court; and (3) the March 1, 1982 order also issued by the respondent court directing the Register of Deeds of Quezon City to annul Transfer Certificate of Title No. 138007 in the name of Adela Salindon and Transfer Certificate of Title No. 239729 in the name of the petitioners. On July 11, 1969, Adela Salindon an awardee of a Philippine Homesite and Housing Corporation (hereinafter referred to as PHHC) lot filed a complaint for ejectment against William Vasquez and Silverio Nicolas with the respondent court. The disputed residential lot, located at Diliman, Quezon City, is more particularly described as follows: Residential lot situated at Quezon City, Philippines, covered by Transfer Certificate of Title No. 138007, in the name of the herein plaintiff, containing an area of 915.00 square meters. Designated as Lot No. 1, Block No. 101 Psd 68808 Diliman Estate Subdivision. Bounded on the SW-by Lot No. 2, Block 101; of the subdivision plan; on the NW-by Road Lot 8, Pcs-4564; on the NE by Road Lot 96; and on the SE by Lot No. 12, Block 101; both of the subdivision plan. In her complaint, Salindon alleged that the defendants were squatters occupying her property.

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242; Vda. de Haberes v. Court of Appeals, 104 SCRA 534). Section 17, Rule 3 of the Rules of Court provides: After a party dies and the claim is not thereby extinguished, the court shall order upon proper notice, the legal representative of the deceased to appear and to be substituted for the deceased within a period of thirty (30) days or within such time as may be granted ... Section 16 of Rule 3 provides: Whenever a party to a pending case dies ... it shall be the duty of his attorney to inform the court promptly of such death ... and to give the name and residence of the executor, administrator, guardian or other legal representative of the deceased ... In the case at bar, Salindon's counsel after her death on December 11, 1976 failed to inform the court of Salindon's death. The appellate court could not be expected to know or take judicial notice of the death of Salindon without the proper manifestation from Salindon's counsel. In such a case and considering that the supervening death of appellant did not extinguish her civil personality, the appellate court was well within its jurisdiction to proceed as it did with the case. There is no showing that the appellate court's proceedings in the case were tainted with irregularities. It appears that the petitioners are heirs of Adela Salindon. In fact, it was because of this relationship that the petitioners were able to transfer the title of Adela Salindon over the subject lot to their names. After Salindon's death, the disputed lot was included as part of her estate. Salindon's counsel, whose acts bind his client, failed to comply with his duty to the court and his deceased client. Considering all this, the appellate decision is binding and enforceable against the petitioners as successors-ininterest by title subsequent to the commencement of the action (Section 49 (b) Rule 39, Rules of Court). Furthermore, "... judgment in an ejectment case may be enforced not only against defendants therein but also against the members of their family, their relatives, or privies who derived their right of possession from the defendants" (Ariem v. De los Angeles, 49 SCRA 343). Under the circumstances of this case, the same rule should apply to the successors-in-interest if the decision should go against the original plaintiff. We note, however, that the petitioners challenge the decision on the ground that the respondent city court had no jurisdiction in the first instance over the ejectment complaint. In this respect, the petitioners are correct. Adela Salindon filed an ejectment case to evict alleged squatters who were in possession of a lot awarded to her by the PHHC. Instead of dealing with the case as a simple one of ejectment and handling the issues within the confines of its limited jurisdiction, the respondent city court went further into territory out of bounds to it and cancelled the administrative determinations of the PHHC, rescinded the deeds of sale, usurped the powers of the administrative agency by awarding the government lots to the defendants on the basis of evidence clearly inadequate from the records and by the rules of the agency to sustain such awards, conclusively adjudicated on the basis of irregular proceedings the ownership of the disputed lot, and ordered the cancellation of Torrens titles already issued in the petitioners' names. May the petitioners take advantage of this lack of jurisdiction? As a rule, the issue of jurisdiction is not lost by waiver or by estoppel. The time honored principle is that "... jurisdiction of a court is a matter of law and may not be conferred by consent or agreement of the parties. The lack of jurisdiction of a court may be raised at any stage of the proceedings, even on appeal ...". (Calimlim v. Ramirez, 118 SCRA 399). This principle, however, is not absolute. There are cases wherein we ruled that because of their exceptional and peculiar circumstances, a party is estopped from invoking the lack of the court's jurisdiction. (Tijam v. Sibonghanoy, 23 SCRA 29; Crisostomo v. Court of Appeals, 32 SCRA 543). We always look into the attendant circumstances of the case so as not to subvert public policy. (See Paro v. Court of Appeals, 111 SCRA 262). This is one such case where the successors-in- interest of the original plaintiff are estopped from questioning the jurisdiction of the respondent court. Adela Salindon, the original plaintiff in the ejectment case consistently maintained her stand that the respondent court had jurisdiction over the ejectment complaint. She insisted on this jurisdiction over the opposition of the defendants, the private respondents herein. Thus, she filed a lengthy memorandum against the dismissal of the complaint after the trial on the merits of the case and made an emphatic justification of the jurisdiction of the respondent court. The following rule applies: ... a party cannot invoke the jurisdiction of a court to secure affirmative relief against his opponent and, after obtaining or failing to obtain such relief, repudiate or question that same jurisdiction (Dean vs. Dean, 136 Or. 694, 86 A.L.R. 79). In the case just cited, by way of explaining the rule, it was further said that the question whether the court had jurisdiction either of the subject-matter of the action or of the parties was not important in such cases because the party is barred from such conduct not because the judgment or order of the court is valid and conclusive as an adjudication but for the reason that such a practice can not be tolerated obviously for reasons of public policy. (Tijam vs. Sibonghanoy, supra) Equitable considerations cannot also help the petitioners. Their own deed of extra-judicial partition dated March 31, 1977 shows that Adela Lucero Salindon left forty four (44) parcels of land, forty two (42) of which were in Pangasinan, one (1) parcel in Natividad Street, Manila and the disputed parcel in Quezon City. There is no showing in the records that the forty three (43) other parcels were either not owned by Salindon when the PHHC lot was awarded to her or that ownership of these lots and of 706,684 shares of stock in such blue chip corporations as Lepanto Consolidated Mining Co., Philippine Overseas Drilling and Oil Development Corporation, etc. did not disqualify her from applying for a PHHC lot. There is no showing from the records that the petitioners would suffer from a denial of substantial justice if the foregoing rules are applied to them. The private respondents, however, stand on an entirely different footing. As defendants in the ejectment case they vigorously questioned the jurisdiction of the city court. They cannot now take advantage of a decision issued in excess of jurisdiction and in doing so abandon a principal averment in their respective answers. The respondent court had no jurisdiction to take over the functions of the PHHC and award ownership of the lot to them. Not only was the decision of the city court rendered without jurisdiction, it was also erroneously irregular to the point of constituting grave abuse of discretion. The PHHC was correct when it stated that squatters and intruders who clandestinely enter into titled government property cannot, by such act, acquire any legal right to said property. There is no showing in the records that the entry of the private respondents into the lot was effected legally and properly. An act which was illegal from the start cannot ripen into lawful ownership simply because the usurper has occupied and possessed the government lot for more than ten (10) years, cleared it of cogon grass, fenced it, and built a house on the premises. No vested rights should be allowed to arise from the social blights and lawless acts of squatting and clandestine entrance. True, the government by an act of magnanimity and in the interest of buying social peace through the quieting of mass unrest may declare usurped property as a "relocation" area for the squatters. However, the records fall to show that there has been such action insofar as the disputed lot is concerned or that the private respondents fall within such a policy or that they have complied with the usual requirements before the benefits of relocation may be given them. At any rate, this was for the PHHC, now the NHA, to decide and not the city court. Under the circumstances of this case, the ownership of the disputed lot remains with. the National Housing Authority. The NHA may use the authority of this decision to evict the private respondents and their successors-in-interest from the property and deal with the lot according to its present powers vested by law and in the light of its current policies and programs. This decision, however, should not be interpreted to preclude the private respondents from introducing evidence and presenting arguments before the National Housing Authority to establish any right to which they may be entitled under the law and the facts of the case. WHEREFORE, the decision dated May 20, 1975, the writ of execution dated August 3, 1981 and the order to annul TCT Nos. 138007 and 239729 dated March 1, 1982, all issued by the respondent city court are nullified and set aside for having been

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issued in excess of jurisdiction and with grave abuse of discretion insofar as the private respondents are concerned. Considering our findings as regards the petitioner, the Registrar of Deeds for Quezon City is hereby ordered to cancel TCT No. 239729 in the names of the petitioners and TCT No. 138007 in the name of Adela Salindon. The National Housing Authority is declared the owner of the disputed lot and is directed to take possession of the same and to either hold or dispose of it according to law and this decision. SO ORDERED.

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epublic of the Philippines SUPREME COURT Manila FIRST DIVISION G.R. No. 143365 December 4, 2008 Thereafter, trial on the merits ensued. At the hearing on 1 June 1984, only the counsel for spouses Palanogs appeared. The trial court issued an order resetting the hearing to 15 August 1984 and likewise directed spouses Saligumbas to secure the services of another counsel who should be ready on that date.4 The order sent to Eliseo Saligumba, Sr. was returned to the court unserved with the notation "PartyDeceased" while the order sent to defendant Valeria Saligumba was returned with the notation "Party in Manila."5 At the hearing on 15 August 1984, spouses Palanogs direct examination was suspended and the continuation of the hearing was set on 25 October 1984. The trial court stated that Atty. Miralles, who had not withdrawn as counsel for spouses Saligumbas despite his appointment as Municipal Circuit Trial Court judge, would be held responsible for the case of spouses Saligumbas until he formally withdrew as counsel. The trial court reminded Atty. Miralles to secure the consent of spouses Saligumbas for his withdrawal.6 A copy of this order was sent to Valeria Saligumba but the same was returned unserved with the notation "Party in Manila."7 The hearing set on 25 October 1984 was reset to 25 January 1985 and the trial court directed that a copy of this order be sent to Eliseo Saligumba, Jr. at COA, PNB, Manila.8 The presentation of evidence for spouses Palanogs resumed on 25 January 1985 despite the motion of Atty. Miralles for postponement on the ground that his client was sick. The exhibits were admitted and plaintiffs spouses Palanogs rested their case. Reception of evidence for the defendants spouses Saligumbas was scheduled on 3, 4, and 5 June 1985.9 On 3 June 1985, only spouses Palanogs and counsel appeared. Upon motion of the spouses Palanogs, spouses Saligumbas were deemed to have waived the presentation of their evidence. On 3 August 1987, after a lapse of more than two years, the trial court considered the case submitted for decision. On 7 August 1987, RTC-Branch 3 rendered a judgment in Civil Case No. 2570 declaring spouses Palanogs the lawful owners of the subject land and ordering spouses Saligumbas, their agents, representatives and all persons acting in privity with them to vacate the premises and restore possession to spouses Palanogs. The trial court, in a separate Order dated 7 August 1987, directed that a copy of the courts decision be furnished plaintiff Monica Palanog and defendant Valeria Saligumba. Thereafter, a motion for the issuance of a writ of execution of the said decision was filed but the trial court, in its Order dated 8 May 1997, ruled that since more than five years had elapsed after the date of its finality, the decision could no longer be executed by mere motion. Thus, on 9 May 1997, Monica Palanog (respondent), now a widow, filed a Complaint seeking to revive and enforce the Decision dated 7 August 1987 in Civil Case No. 2570 which she claimed has not been barred by the statute of limitations. She impleaded petitioners Generoso Saligumba and Ernesto Saligumba, the heirs and children of the spouses Saligumbas, as defendants. The case was docketed as Civil Case No. 5288 before the RTC-Branch 5. Petitioner Generoso Saligumba, for himself and in representation of his brother Ernesto who was out of the country working as a seaman, engaged the services of the Public Attorneys Office, Kalibo, Aklan which filed a motion for time to allow them to file a responsive pleading. Petitioner Generoso Saligumba filed his Answer10 alleging that: (1) respondent had no cause of action; (2) the spouses Saligumbas died while Civil Case No. 2570 was pending and no order of substitution was issued and hence, the trial was null and void; and (3) the court did not acquire jurisdiction over the heirs of the spouses Saligumbas and therefore, the judgment was not binding on them. Meanwhile, on 19 December 1997, the trial court granted respondents motion to implead additional defendants namely, Eliseo Saligumba, Jr. and Eduardo Saligumba, who are also the heirs and children of spouses Saligumbas.11 They were, however, declared in default on 1 October 1999 for failure to file any responsive pleading.12 The Trial Courts Ruling On 24 May 2000, the RTC-Branch 5 rendered a decision in favor of respondent ordering the revival of judgment in Civil Case No. 2570. The trial court ruled that the non-substitution of the deceased spouses did not have any legal significance. The land subject of Civil Case No. 2570 was the exclusive property of defendant Valeria Saligumba who inherited the same from her deceased parents. The death of her husband, Eliseo Saligumba, Sr., did not change the complexion of the ownership of the property that would require his substitution. The spouses Saligumbas children, who are the petitioners in this case, had no right to the property while Valeria Saligumba was still alive. The trial court further found that when defendant Valeria Saligumba died, her lawyer, Atty. Miralles, did not inform the court of the death of his client. The trial court thus ruled that the nonsubstitution of the deceased defendant was solely due to the negligence of counsel. Moreover, petitioner Ernesto Saligumba could not feign ignorance of Civil Case No. 2570 as he was present during the delimitation of the subject land. The trial court likewise held that the decision in Civil Case No. 2570 could not be the subject of a collateral attack. There must be a direct action for the annulment of the said decision. Petitioners elevated the matter directly to this Court. Hence, the present petition. The Courts Ruling

GENEROSO SALIGUMBA, ERNESTO SALIGUMBA, and HEIRS OF SPOUSES VALERIA SALIGUMBA AND ELISEO SALIGUMBA, SR., petitioners, vs. MONICA PALANOG, respondent. DECISION CARPIO, J.: The Case This is a petition for review of the Decision dated 24 May 2000 of the Regional Trial Court, Branch 5, Kalibo, Aklan (RTC-Branch 5) in Civil Case No. 5288 for Revival of Judgment. The case is an offshoot of the action for Quieting of Title with Damages in Civil Case No. 2570. The Facts Monica Palanog, assisted by her husband Avelino Palanog (spouses Palanogs), filed a complaint dated 28 February 1977 for Quieting of Title with Damages against defendants, spouses Valeria Saligumba and Eliseo Saligumba, Sr. (spouses Saligumbas), before the Regional Trial Court, Branch 3, Kalibo, Aklan (RTC-Branch 3). The case was docketed as Civil Case No. 2570. In the complaint, spouses Palanogs alleged that they have been in actual, open, adverse and continuous possession as owners for more than 50 years of a parcel of land located in Solido, Nabas, Aklan. The spouses Saligumbas allegedly prevented them from entering and residing on the subject premises and had destroyed the barbed wires enclosing the land. Spouses Palanogs prayed that they be declared the true and rightful owners of the land in question. When the case was called for pre-trial on 22 September 1977, Atty. Edilberto Miralles (Atty. Miralles), counsel for spouses Saligumbas, verbally moved for the appointment of a commissioner to delimit the land in question. Rizalino Go, Deputy Sheriff of Aklan, was appointed commissioner and was directed to submit his report and sketch within 30 days.1 Present during the delimitation were spouses Palanogs, spouses Saligumbas, and Ernesto Saligumba, son of spouses Saligumbas.2 After submission of the Commissioners Report, spouses Palanogs, upon motion, were granted 10 days to amend their complaint to conform with the items mentioned in the report.3

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The instant case is an action for revival of judgment and the judgment sought to be revived in this case is the decision in the action for quieting of title with damages in Civil Case No. 2570. This is not one for annulment of judgment. An action for revival of judgment is no more than a procedural means of securing the execution of a previous judgment which has become dormant after the passage of five years without it being executed upon motion of the prevailing party. It is not intended to re-open any issue affecting the merits of the judgment debtors case nor the propriety or correctness of the first judgment.13 An action for revival of judgment is a new and independent action, different and distinct from either the recovery of property case or the reconstitution case, wherein the cause of action is the decision itself and not the merits of the action upon which the judgment sought to be enforced is rendered.14 Revival of judgment is premised on the assumption that the decision to be revived, either by motion or by independent action, is already final and executory.15 The RTC-Branch 3 Decision dated 7 August 1987 in Civil Case No. 2570 had been rendered final and executory by the lapse of time with no motion for reconsideration nor appeal having been filed. While it may be true that the judgment in Civil Case No. 2570 may be revived and its execution may be had, the issue now before us is whether or not execution of judgment can be issued against petitioners who claim that they are not bound by the RTC-Branch 3 Decision dated 7 August 1987 in Civil Case No. 2570. Petitioners contend that the RTC-Branch 3 Decision of 7 August 1987 in Civil Case No. 2570 is null and void since there was no proper substitution of the deceased spouses Saligumbas despite the trial courts knowledge that the deceased spouses Saligumbas were no longer represented by counsel. They argue that they were deprived of due process and justice was not duly served on them. Petitioners argue that the trial court even acknowledged the fact of death of spouses Saligumbas but justified the validity of the decision rendered in that case despite lack of substitution because of the negligence or fault of their counsel. Petitioners contend that the duty of counsel for the deceased spouses Saligumbas to inform the court of the death of his clients and to furnish the name and address of the executor, administrator, heir or legal representative of the decedent under Rule 3 presupposes adequate or active representation by counsel. However, the relation of attorney and client was already terminated by the appointment of counsel on record, Atty. Miralles, as Municipal Circuit Trial Court judge even before the deaths of the spouses Saligumbas were known. Petitioners invoke the Order of 1 June 1984 directing the spouses Saligumbas to secure the services of another lawyer to replace Atty. Miralles. The registered mail containing that order was returned to the trial court with the notation that Eliseo Saligumba, Sr. was "deceased." Petitioners thus question the decision in Civil Case No. 2570 as being void and of no legal effect because their parents were not duly represented by counsel of record. Petitioners further argue that they have never taken part in the proceedings in Civil Case No. 2570 nor did they voluntarily appear or participate in the case. It is unfair to bind them in a decision rendered against their deceased parents. Therefore, being a void judgment, it has no legal nor binding effect on petitioners. Civil Case No. 2570 is an action for quieting of title with damages which is an action involving real property. It is an action that survives pursuant to Section 1, Rule 8716 as the claim is not extinguished by the death of a party. And when a party dies in an action that survives, Section 17 of Rule 3 of the Revised Rules of Court17 provides for the procedure, thus: Section 17. Death of Party. - After a party dies and the claim is not thereby extinguished, the court shall order, upon proper notice, the legal representative of the deceased to appear and to be substituted for the deceased, within a period of thirty (30) days, or within such time as may be granted. If the legal representative fails to appear within said time, the court may order the opposing party to procure the appointment of a legal representative of the deceased within a time to be specified by the court, and the representative shall immediately appear for and on behalf of the interest of the deceased. The court charges involved in procuring such appointment, if defrayed by the opposing party, may be recovered as costs. The heirs of the deceased may be allowed to be substituted for the deceased, without requiring the appointment of an executor or administrator and the court may appoint guardian ad litem for the minor heirs. (Emphasis supplied) Under the express terms of Section 17, in case of death of a party, and upon proper notice, it is the duty of the court to order the legal representative or heir of the deceased to appear for the deceased. In the instant case, it is true that the trial court, after receiving an informal notice of death by the mere notation in the envelopes, failed to order the appearance of the legal representative or heir of the deceased. There was no court order for deceaseds legal representative or heir to appear, nor did any such legal representative ever appear in court to be substituted for the deceased. Neither did the respondent ever procure the appointment of such legal representative, nor did the heirs ever ask to be substituted. It appears that Eliseo Saligumba, Sr. died on 18 February 1984 while Valeria Saligumba died on 2 February 1985. No motion for the substitution of the spouses was filed nor an order issued for the substitution of the deceased spouses Saligumbas in Civil Case No. 2570. Atty. Miralles and petitioner Eliseo Saligumba, Jr., despite notices sent to them to appear, never confirmed the death of Eliseo Saligumba, Sr. and Valeria Saligumba. The record is bereft of any evidence proving the death of the spouses, except the mere notations in the envelopes enclosing the trial courts orders which were returned unserved. Section 17 is explicit that the duty of the court to order the legal representative or heir to appear arises only "upon proper notice." The notation "Party-Deceased" on the unserved notices could not be the "proper notice" contemplated by the rule. As the trial court could not be expected to know or take judicial notice of the death of a party without the proper manifestation from counsel, the trial court was well within its jurisdiction to proceed as it did with the case. Moreover, there is no showing that the courts proceedings were tainted with irregularities.18 Likewise, the plaintiff or his attorney or representative could not be expected to know of the death of the defendant if the attorney for the deceased defendant did not notify the plaintiff or his attorney of such death as required by the rules.19 The judge cannot be blamed for sending copies of the orders and notices to defendants spouses in the absence of proof of death or manifestation to that effect from counsel.20 Section 16, Rule 3 of the Revised Rules of Court likewise expressly provides: SEC. 16. Duty of attorney upon death, incapacity or incompetency of party. - Whenever a party to a pending case dies, becomes incapacitated or incompetent, it shall be the duty of his attorney to inform the court promptly of such death, incapacity or incompetency, and to give the name and residence of his executor, administrator, guardian or other legal representative. It is the duty of counsel for the deceased to inform the court of the death of his client. The failure of counsel to comply with his duty under Section 16 to inform the court of the death of his client and the nonsubstitution of such party will not invalidate the proceedings and the judgment thereon if the action survives the death of such party. The decision rendered shall bind the partys successor-ininterest.21 The rules operate on the presumption that the attorney for the deceased party is in a better position than the attorney for the adverse party to know about the death of his client and to inform the court of the name and address of his legal representative.22 Atty. Miralles continued to represent the deceased spouses even after the latters demise. Acting on their behalf, Atty. Miralles even asked for postponement of the hearings and did not even confirm the death of his clients nor his appointment as Municipal Circuit Trial Court judge. These clearly negate petitioners contention that Atty. Miralles ceased to be spouses Saligumbas counsel. Atty. Miralles still remained the counsel of the spouses Saligumbas despite the alleged appointment as judge. Records show that when Civil Case No. 2570 was called for trial on 25 October 1984, Atty. Miralles appeared and moved for a postponement. The 25 October 1984 Order reads: ORDER

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courts alleged lack of jurisdiction over the persons of petitioners, petitioners never bothered to challenge the same, and in fact allowed the proceedings to go on until the trial court rendered its decision. There was no motion for reconsideration, appeal or even an action to annul the judgment in Civil Case No. 2570. Petitioners themselves could not feign ignorance of the case since during the pendency of Civil Case No. 2570, petitioner Ernesto Saligumba, son of the deceased spouses, was among the persons present during the delimitation of the land in question before the Commissioner held on 5 November 1977.31 Petitioner Eliseo Saligumba, Jr. was likewise furnished a copy of the trial courts orders and notices. It was only the Answer filed by petitioner Generoso Saligumba in Civil Case No. 5288 that confirmed the dates when the spouses Saligumbas died and named the latters children. Consequently, Atty. Miralles was responsible for the conduct of the case since he had not been properly relieved as counsel of record. His acts bind his clients and the latters successors-in-interest. In the present case for revival of judgment, the other petitioners have not shown much interest in the case. Petitioners Eliseo Saligumba, Jr. and Eduardo Saligumba were declared in default for failure to file their answer. Petitioner Ernesto Saligumba was out of the country working as a seaman. Only petitioner Generoso Saligumba filed an Answer to the complaint. The petition filed in this Court was signed only by petitioner Generoso Saligumba as someone signed on behalf of petitioner Ernesto Saligumba without the latters authority to do so. WHEREFORE, we DENY the petition. We AFFIRM the Decision dated 24 May 2000 of the Regional Trial Court, Branch 5, Kalibo, Aklan in Civil Case No. 5288. Costs against petitioners. SO ORDERED.

Upon petition of Judge Miralles who is still the counsel on record of this case and who is held responsible for anything that will happen in this case, postpone the hearing of this case to JANUARY 25, 1985 AT 8:30 in the morning. x x x23 The trial court issued an Order dated 1 June 1984 directing the defendants to secure the services of another counsel. This order was sent to Eliseo Saligumba, Sr. by registered mail but the same was returned with the notation "Party-Deceased" while the notice to Valeria Saligumba was returned with the notation "Party in Manila."24 Eliseo Saligumba, Sr. died on 18 February 1984. When Atty. Miralles appeared in court on 25 October 1984, he did not affirm nor inform the court of the death of his client. There was no formal substitution. The trial court issued an order resetting the hearing to 25 January 1985 and directed that a copy of the order be furnished petitioner Eliseo Saligumba, Jr. at COA, PNB, Manila by registered mail.25 When the case was called on 25 January 1985, Atty. Miralles sought for another postponement on the ground that his client was sick and under medical treatment in Manila.26 Again, there was no manifestation from counsel about the death of Eliseo Saligumba, Sr. The trial court issued an Order dated 25 January 1985 setting the reception of evidence for the defendants on 3, 4, and 5 June 1985. A copy of this order was sent to Eliseo Saligumba, Jr. by registered mail. Nonetheless, as the trial court in Civil Case No. 5288 declared, the nonsubstitution of Eliseo Saligumba, Sr. did not have any legal significance as the land subject of Civil Case No. 2570 was the exclusive property of Valeria Saligumba who inherited it from her deceased parents. This notwithstanding, when Valeria Saligumba died on 2 February 1985, Atty. Miralles again did not inform the trial court of the death of Valeria Saligumba. There was no formal substitution nor submission of proof of death of Valeria Saligumba. Atty. Miralles was remiss in his duty under Section 16, Rule 3 of the Revised Rules of Court. The counsel of record is obligated to protect his clients interest until he is released from his professional relationship with his client. For its part, the court could recognize no other representation on behalf of the client except such counsel of record until a formal substitution of attorney is effected.27 An attorney must make an application to the court to withdraw as counsel, for the relation does not terminate formally until there is a withdrawal of record; at least, so far as the opposite party is concerned, the relation otherwise continues until the end of the litigation.28 Unless properly relieved, the counsel is responsible for the conduct of the case.29 Until his withdrawal shall have been approved, the lawyer remains counsel of record who is expected by his client as well as by the court to do what the interests of his client require. He must still appear on the date of hearing for the attorney-client relation does not terminate formally until there is a withdrawal of record.30 Petitioners should have questioned immediately the validity of the proceedings absent any formal substitution. Yet, despite the

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Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No. L-10458 April 22, 1957 With regard to the second, it also appears that the deed sale which is sought to be annulled was made in favor of Sulpicia Guanzon whereas the deed of donation was made in favor of Joven Salvador Guanzon, and there is nothing from which it maybe inferred that the two defendants have a common interest that maybe joined in one cause of action on the contrary their interest is distinct and separate. They cannot therefore be joined in one cause of action. In the light of the above considerations, it may be stated that the motion to dismiss filed by petitioners in so far as the cause of action involving the annulment of the deed of sale covering the properties in Negros Occidental is well taken and should have by the lower court. Petition is granted. The orders of respondent Judge dated February 7, 1956, and March 5, 1956 are hereby set aside. The complaint in so far as the cause of action affecting petitioners is hereby dismissed, leaving the complaint valid as regards the other defendants, with costs against respondent Pastora Alvarez Guanzon. Bengzon, Padilla, Montemayor, Concepcion, Reyes, J. B. L., Endencia and Felix, JJ., concur.

VICENTE MIJARES and SULPICIA GUANZON, petitioner, vs. HONORABLE EDMUNDO S. PICCIO, Judge of the Court of First Instance of Cebu and PASTORA ALVAREZ GUANZON, respondents. Luis G. Torres for petitioners. Antonio Y. de Pio and Pedro T. Garcia for respondent Pastora A. Guanzon. BAUTISTA ANGELO, J.: This is a petition for prohibition and certiorari with preliminary injunction seeking to enjoin respondent Judge from enforcing his order requiring petitioners to answer the complaint and proceed with the trial in Civil Case No. R-3822 and asking at the same time that said order be set aside and the case be dismissed as regards said petitioners. On December 24, 1954, Pastora Alvarez Guanzon filed a complaint in the Court of First Instance of Cebu against her husband Jose M. Guanzon containing two causes of action: one for the annulment of a deed of sale in favor of Sulpicia Guanzon of certain real properties situated in the province of Negros Occidental, and the annulment of a deed of donation inter-vivos in favor of Joven Salvador Guanzon of another set of real properties situated in the province of Cebu; and another for the separation of their conjugal properties which include both real and personal acquired during marriage (Civil Case No. R-3823). On October 19, 1955, plaintiff filed a motion to bring into the case Sulpicia Guanzon and her husband Vicente Mijares as parties defendants alleging that their presence there in is indispensable. This motion was granted and said defendants were duly summoned in accordance with law. On January 17, 1956, new defendants Sulpicia Guanzon and Vicente Mijares, of filing their answer, filed a motion to dismiss based on three grounds to wit: (1) that venue is improperly laid, (2) that their is a misjoinder of cause, of action and of and (3) that the court has no jurisdiction of said defendants. After hearing the parties on this motion, the court denied the same on February 7, 1956, holding that the action is in personam as it does affect title to real property, that there is no misjoinder of causes of action, and that it has jurisdiction over the persons of the movants. The movants filed a motion for the reconsideration, and when this was denied, they interposed the present petition for prohibition and certiorari seeking to set aside the two orders adverted to.

The present case involves the rule which the joinder of several causes of action, the pertinent provision of which is embodied in Rule 2, section 5, which provides that "Subject to rules regarding venue and joinder of parties, a party may in one complaint, counterclaim, cross-claim and third-party claim state, in the alternative or otherwise, as many different causes of action as he may have against an opposing party." While this rule appears simple, however, difficulties may arise in its application, for it does not state specifically the cases where several causes of action may be joined, each case apparently depending upon the nature of the transactions involved. But one thing is clear: That the joining of causes of action must be subject to the rules regarding venue and joinder of parties. If these rules are violated, then a misjoinder of causes of action may arise. Former Chief Justice Moran gives several illustrations of how this rule may be applied which are interesting. On this point he makes the following comment: This rule, which is expressly extended to counterclaims, crossclaims, and third-party claims, is subject to the limitation regarding venue, whereby several causes of action with no common venue cannot be joined. For instance, if A, a resident of Manila, has against E, a resident of Baguio, two causes of action, one for money, and another for title to real property located in Zamboanga, he cannot join them in a single complaint, for the venue of the first action, which is either Manila or Baguio, is different from the venue of the second, which is Zamboanga. The rule is likewise subject to the limitation regarding joinder of parties. For instance plaintiff A has a cause of action against B, another cause of action against C, and another cause of action against D, the three causes of action cannot be joined, because there would be a misjoinder of parties defendant, each of them being interested in the cause of action alleged against him not in the other causes of action pleaded against the others.1 A claim on a promissory note against three defendants may not be joined with a claim on another promissory note against two of the defendants, for again there is a misjoinder of parties, the third defendant in the first cause of action not having an interest in the second cause of action.2(Moran, Comments on the Rules of Court, Vol. 1, 1952 Ed., p. 24). In the light of the instances cited by former Chief Justice Moran, it maybe stated that there is a misjoinder of causes of action in the present case not only as regards venue but also as regards the defendants. With regard to the first, it should be noted that the first cause of action stated in the complaint refers to the annulment of a deed of sale real properties situated in the province of Negros Occidental, and of a deed of donation inter vivos of another set of real properties situated in the province of Cebu. They refer to two different transactions which properties situated in two different provinces. The venue has therefore been improperly laid as regards the properties in Negros Occidental.

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Republic of the Philippines SUPREME COURT FIRST DIVISION G.R. No. 152808 September 30, 2005 ANTONIO T. CHUA, Petitioners, vs. TOTAL OFFICE PRODUCTS AND SERVICES (TOPROS), INC., Respondent. DECISION QUISUMBING, J.: For review on certiorari is the decision1 dated November 28, 2001 of the Court of Appeals and its resolution2 of April 1, 2002 in CA-G.R. SP No. 62592. The assailed decision and resolution dismissed the special civil action for certiorari against the orders of August 9, 20003 and October 6, 20004 issued by Judge Lorifel Lacap Pahimna in Civil Case No. 67736. The pertinent facts, based on the records, are as follows: On December 28, 1999, respondent Total Office Products and Services, Inc., (TOPROS) lodged a complaint for annulment of contracts of loan and real estate mortgage against herein petitioner Antonio T. Chua before the Regional Trial Court of Pasig City. The case was docketed as Civil Case No. 67736 and was raffled to the sala of Judge Lorifel Lacap Pahimna. The said suit sought to annul a loan contract allegedly extended by petitioner to respondent TOPROS in the amount of ten million four hundred thousand pesos (P10,400,000) and the accessory real estate mortgage contract covering two parcels of land situated in Quezon City as collateral. It appeared on the face of the subject contracts that TOPROS was represented by its president John Charles Chang, Jr. However, TOPROS alleged that the purported loan and real estate mortgage contracts were fictitious, since it never authorized anybody, not even its president, to enter into said transaction. On February 28, 2000, petitioner filed a motion to dismiss on the ground of improper venue. He contended that the action filed by TOPROS affects title to or possession of the parcels of land subject of the real estate mortgage. He argued that it should thus have been filed in the Regional Trial Court of Quezon City where the encumbered real properties are located, instead of Pasig City where the parties reside. On August 9, 2000, Judge Pahimna issued an order denying the motion to dismiss. She reasoned that the action to annul the loan and mortgage contracts is a personal action and thus, the venue was properly laid in the RTC of Pasig City where the parties reside. Petitioner moved for a reconsideration of the said order, which Judge Pahimna denied in its order of October 6, 2000. Hence, petitioner filed with the Court of Appeals a special civil action for certiorari alleging: THE RESPONDENT JUDGE COMMITTED GRAVE ABUSE OF DISCRETION IN DISREGARDING THE RULING OF THE SUPREME COURT IN PASCUAL VS. PASCUAL REGARDING THE RULE ON PROPER VENUE, AND CONSEQUENTLY ADJUDGING TO BE A PERSONAL ACTION A CIVIL COMPLAINT FOR THE ANNULMENT OF AN ALLEGEDLY FICTITIOUS CONTRACT.5 The Court of Appeals dismissed said petition in its decision dated November 28, 2001. It held that the authorities relied upon by petitioner, namely Pascual v. Pascual6 and Banco Espaol-Filipino v. Palanca,7 are inapplicable in the instant case. The appellate court instead applied Hernandez v. Rural Bank of Lucena, Inc.8 wherein we ruled that an action for the cancellation of a real estate mortgage is a personal action if the mortgagee has not foreclosed the mortgage and the mortgagor is in possession of the premises, as neither the mortgagors title to nor possession of the property is disputed. Dissatisfied, petitioner filed a motion for reconsideration, which the Court of Appeals denied for lack of merit in its resolution of April 1, 2002. Undeterred, petitioner now comes to us on a petition for review raising the following issues: WHETHER AN ACTION TO ANNUL A LOAN AND MORTGAGE CONTRACT DULY ALLEGED AS FICTITIOUS FOR BEING WITH ABSOLUTELY NO CONSIDERATION IS A PERSONAL ACTION OR REAL ACTION? WHETHER IN AN ACTION TO ANNUL A LOAN AND MORTGAGE CONTRACT DULY ALLEGED AS FICTITIOUS FOR BEING WITH ABSOLUTELY NO CONSIDERATION, THE PERSON ALLEGED TO HAVE [LACKED] AUTHORITY TO ENTER INTO SAID CONTRACTS IS AN INDISPENSABLE PARTY?9 Petitioner contends that Hernandez should not be applied here because in the said case: (1) venue was improperly laid at the outset; (2) the complaint recognized the validity of the principal contract involved; and (3) the plaintiff sought to compel acceptance by the defendant of plaintiffs payment of the latters mortgage debt. He insists that the Pascual case should be applied instead. He invokes our pronouncement in Pascual, to wit: It appearing, however, that the sale is alleged to be fictitious, with absolutely no consideration, it should be regarded as a nonexistent, not merely null, contract. And there being no contract between the deceased and the defendants, there is in truth nothing to annul by action. The action brought cannot thus be for annulment of contract, but is one for recovery of a fishpond, a real action that should be, as it has been, brought in Pampanga, where the property is located.10 Petitioner likewise cites the Banco Espaol-Filipino case, thus: Where the defendant in a mortgage foreclosure lives out of the Islands and refuses to appear or otherwise submit himself to the authority of the court, the jurisdiction of the latter is limited to the mortgaged property, with respect to which the jurisdiction of the court is based upon the fact that the property is located within the district and that the court, under the provisions of law applicable in such cases, is vested with the power to subject the property to the obligation created by the mortgage. In such case personal jurisdiction over the nonresident defendant is nonessential and in fact cannot be acquired.11 Petitioner also alleges that John Charles Chang, Jr., the president of TOPROS, who allegedly entered into the questioned loan and real estate mortgage contracts, is an indispensable party who has not been properly impleaded. TOPROS, however, maintains that the appellate court correctly sustained the lower courts finding that the instant complaint for annulment of loan and real estate mortgage contracts is a personal action. TOPROS points out that a complaint for the declaration of nullity of a loan contract for lack of consent and consideration remains a personal action even if the said action will necessarily affect the accessory real estate mortgage. TOPROS argues that Pascual is inapplicable because the subject contract therein was a contract of sale of a parcel of land where title and possession were already transferred to the defendant. TOPROS further contends that Banco Espaol-Filipino is also inapplicable since the personal action filed therein was one which affected the personal status of a nonresident defendant. Considering the facts and the submission of the parties, we find the petition bereft of merit. Well-settled is the rule that an action to annul a contract of loan and its accessory real estate mortgage is a personal action. In a personal action, the plaintiff seeks the recovery of personal property, the enforcement of a contract or the recovery of damages.12 In contrast, in a real action, the plaintiff seeks the recovery of real property, or, as indicated in Section 2 (a), Rule 4 of the then Rules of Court, a real action is an action affecting title to real property or for the recovery of possession, or for partition or condemnation of, or foreclosure of mortgage on, real property.13 In the Pascual case, relied upon by petitioner, the contract of sale of the fishpond was assailed as fictitious for lack of consideration. We held that there being no contract to begin with, there is nothing to annul. Hence, we deemed the action for annulment of the said fictitious contract therein as one constituting a real action for the recovery of the fishpond subject thereof.

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Civil Procedure Case Set 2 New Era University College of Law PERRAL
SEC. 2. Venue of personal actions. All other actions may be commenced and tried where the plaintiff or any of the principal plaintiffs resides, or where the defendant or any of the principal defendants resides, or in the case of a non-resident defendant where he may be found, at the election of the plaintiff.14 Thus, Pasig City, where the parties reside, is the proper venue of the action to nullify the subject loan and real estate mortgage contracts. The Court of Appeals committed no reversible error in upholding the orders of the Regional Trial Court denying petitioners motion to dismiss the case on the ground of improper venue. Anent the second issue, Section 7, Rule 3 of the Revised Rules of Court provides: SEC. 7. Compulsory joinder of indispensable parties. Parties in interest without whom no final determination can be had of an action shall be joined either as plaintiffs or defendants. (Emphasis ours) The presence of indispensable parties is necessary to vest the court with jurisdiction. The absence of an indispensable party renders all subsequent actuations of the court null and void, because of that courts want of authority to act, not only as to the absent parties but even as to those present.15 Thus, whenever it appears to the court in the course of a proceeding that an indispensable party has not been joined, it is the duty of the court to stop the trial and order the inclusion of such party.16 A person is not an indispensable party, however, if his interest in the controversy or subject matter is separable from the interest of the other parties, so that it will not necessarily be directly or injuriously affected by a decree which does complete justice between them.17 Is John Charles Chang, Jr., the president of TOPROS who allegedly entered into the disputed contracts of loan and real estate mortgage, an indispensable party in this case? We note that although it is Changs signature that appears on the assailed real estate mortgage contract, his participation is limited to being a representative of TOPROS, allegedly without authority. The document18 which constitutes as the contract of real estate mortgage clearly points to petitioner and TOPROS as the sole parties-in-interest to the agreement as mortgagee and mortgagor therein, respectively. Any rights or liabilities arising from the said contract would therefore bind only the petitioner and TOPROS as principal parties. Chang, acting as mere representative of TOPROS, acquires no rights whatsoever, nor does he incur any liabilities, arising from the said contract between petitioner and TOPROS. Certainly, in our view, the only indispensable parties to the mortgage contract are petitioner and TOPROS alone. We thus hold that John Charles Chang, Jr., is not an indispensable party in Civil Case No. 67736. This is without prejudice to any separate action TOPROS may institute against Chang, Jr., in a proper proceeding. WHEREFORE, the petition is DENIED. The assailed decision dated November 28, 2001 and resolution dated April 1, 2002 of the Court of Appeals upholding the Orders of Judge Lorifel Lacap Pahimna are AFFIRMED. No pronouncement as to costs. SO ORDERED.

We cannot, however, apply the foregoing doctrine to the instant case. Note that in Pascual, title to and possession of the subject fishpond had already passed to the vendee. There was, therefore, a need to recover the said fishpond. But in the instant case, ownership of the parcels of land subject of the questioned real estate mortgage was never transferred to petitioner, but remained with TOPROS. Thus, no real action for the recovery of real property is involved. This being the case, TOPROS action for annulment of the contracts of loan and real estate mortgage remains a personal action. Petitioners reliance on the Banco Espaol-Filipino case is likewise misplaced. That case involved a foreclosure of real estate mortgage against a nonresident. We held therein that jurisdiction is determined by the place where the real property is located and that personal jurisdiction over the nonresident defendant is nonessential and, in fact, cannot be acquired. Needless to stress, the instant case bears no resemblance to the Banco Espaol-Filipino case. In the first place, this is not an action involving foreclosure of real estate mortgage. In the second place, none of the parties here is a nonresident. We find no reason to apply here our ruling in Banco Espaol-Filipino. The Court of Appeals finds that Hernandez v. Rural Bank of Lucena, Inc. provides the proper precedent in this case. In Hernandez, appellants contended that the action of the Hernandez spouses for the cancellation of the mortgage on their lots was a real action affecting title to real property, which should have been filed in the place where the mortgaged lots were situated. Rule 4, Section 2 (a), of the then Rules of Court, was applied, to wit: SEC. 2. Venue in Courts of First Instance. (a) Real actions. Actions affecting title to, or for recovery of possession, or for partition or condemnation of, or foreclosure of mortgage on, real property, shall be commenced and tried in the province where the property or any part thereof lies. The Court pointed out in the Hernandez case that with respect to mortgage, the rule on real actions only mentions an action for foreclosure of a real estate mortgage. It does not include an action for the cancellation of a real estate mortgage. Exclusio unios est inclusio alterius. The latter thus falls under the catch-all provision on personal actions under paragraph (b) of the abovecited section, to wit: SEC. 2 (b) Personal actions. All other actions may be commenced and tried where the defendant or any of the defendants resides or may be found, or where the plaintiff or any of the plaintiffs resides, at the election of the plaintiff. In the same vein, the action for annulment of a real estate mortgage in the present case must fall under Section 2 of Rule 4, to wit:

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Civil Procedure Case Set 2 New Era University College of Law PERRAL
Republic of the Philippines SUPREME COURT Manila THIRD DIVISION G. R. No. 156966 May 7, 2004 Section 4, Rule 4, of the Revised Rules of Civil Procedure2 allows the parties to agree and stipulate in writing, before the filing of an action, on the exclusive venue of any litigation between them. Such an agreement would be valid and binding provided that the stipulation on the chosen venue is exclusive in nature or in intent, that it is expressed in writing by the parties thereto, and that it is entered into before the filing of the suit. The provision contained in paragraph 22 of the "Mobile Service Agreement," a standard contract made out by petitioner PILTEL to its subscribers, apparently accepted and signed by respondent, states that the venue of all suits arising from the agreement, or any other suit directly or indirectly arising from the relationship between PILTEL and subscriber, "shall be in the proper courts of Makati, Metro Manila." The added stipulation that the subscriber "expressly waives any other venue"3 should indicate, clearly enough, the intent of the parties to consider the venue stipulation as being preclusive in character. The appellate court, however, would appear to anchor its decision on the thesis that the subscription agreement, being a mere contract of adhesion, does not bind respondent on the venue stipulation. Indeed, the contract herein involved is a contract of adhesion. But such an agreement is not per se inefficacious. The rule instead is that, should there be ambiguities in a contract of adhesion, such ambiguities are to be construed against the party that prepared it. If, however, the stipulations are not obscure, but are clear and leave no doubt on the intention of the parties, the literal meaning of its stipulations must be held controlling.4 A contract of adhesion is just as binding as ordinary contracts. It is true that this Court has, on occasion, struck down such contracts as being assailable when the weaker party is left with no choice by the dominant bargaining party and is thus completely deprived of an opportunity to bargain effectively. Nevertheless, contracts of adhesion are not prohibited even as the courts remain careful in scrutinizing the factual circumstances underlying each case to determine the respective claims of contending parties on their efficacy. In the case at bar, respondent secured six (6) subscription contracts for cellular phones on various dates. It would be difficult to assume that, during each of those times, respondent had no sufficient opportunity to read and go over the terms and conditions embodied in the agreements. Respondent continued, in fact, to acquire in the pursuit of his business subsequent subscriptions and remained a subscriber of petitioner for quite sometime. In Development Bank of the Philippines vs. National Merchandising Corporation,5 the contracting parties, being of age and businessmen of experience, were presumed to have acted with due care and to have signed the assailed documents with full knowledge of their import. The situation would be no less true than that which obtains in the instant suit. The circumstances in Sweet Lines, Inc. vs. Teves,6 wherein this Court invalidated the venue stipulation contained in the passage ticket, would appear to be rather peculiar to that case. There, the Court took note of an acute shortage in inter-island vessels that left passengers literally scrambling to secure accommodations and tickets from crowded and congested counters. Hardly, therefore, were the passengers accorded a real opportunity to examine the fine prints contained in the tickets, let alone reject them. A contract duly executed is the law between the parties, and they are obliged to comply fully and not selectively with its terms. A contract of adhesion is no exception.7 WHEREFORE, the instant petition is GRANTED, and the questioned decision and resolution of the Court of Appeals in CAG.R. SP No. 68104 are REVERSED and SET ASIDE. Civil Case No. 5572 pending before the Regional Trial Court of Iligan City, Branch 4, is DISMISSED without prejudice to the filing of an appropriate complaint by respondent against petitioner with the court of proper venue. No costs. SO ORDERED.

PILIPINO TELEPHONE CORPORATION, petitioner, vs. DELFINO TECSON, respondent. DECISION VITUG, J.: The facts, by and large, are undisputed. On various dates in 1996, Delfino C. Tecson applied for six (6) cellular phone subscriptions with petitioner Pilipino Telephone Corporation (PILTEL), a company engaged in the telecommunications business, which applications were each approved and covered, respectively, by six mobiline service agreements. On 05 April 2001, respondent filed with the Regional Trial Court of Iligan City, Lanao Del Norte, a complaint against petitioner for a "Sum of Money and Damages." Petitioner moved for the dismissal of the complaint on the ground of improper venue, citing a common provision in the mobiline service agreements to the effect that "Venue of all suits arising from this Agreement or any other suit directly or indirectly arising from the relationship between PILTEL and subscriber shall be in the proper courts of Makati, Metro Manila. Subscriber hereby expressly waives any other venues."1 In an order, dated 15 August 2001, the Regional Trial Court of Iligan City, Lanao del Norte, denied petitioners motion to dismiss and required it to file an answer within 15 days from receipt thereof. Petitioner PILTEL filed a motion for the reconsideration, through registered mail, of the order of the trial court. In its subsequent order, dated 08 October 2001, the trial court denied the motion for reconsideration. Petitioner filed a petition for certiorari under Rule 65 of the Revised Rules of Civil Procedure before the Court of Appeals. The Court of Appeals, in its decision of 30 April 2002, saw no merit in the petition and affirmed the assailed orders of the trial court. Petitioner moved for a reconsideration, but the appellate court, in its order of 21 January 2003, denied the motion. There is merit in the instant petition.

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