Villegas Vs. Hiu Chiong Case Digest Villegas Vs. Hiu Chiong 86 SCRA 270 No.

L-29646 November 10, 1978 Facts: The controverted Ordinance no. 6537 was passed by the MunicipalBoard of Manila on February 22, 1968 and signed by Mayor Villegas. It is an ordinance making it unlawful for any person not a citizen of thePhilippines to be employed in any place of employment or to be engaged in any kind of trade business or occupation within the city of Manila withoutsecuring an employment permit from the Mayor of Manila and for other purposes. Hiu Chiong Tsai Pao Ho, who was employed in Manila filed a petition praying for the writ of preliminary injunction and restraining order to stop the enforcement of said ordinance. Issue: Whether or Not Ordinance no.6537 violates the due process and equal protection clauses of the Constitution. Held: It is a revenue measure. The city ordinance which imposes a fee of 50.00 pesos to enable aliens generally to be employed in the city of Manila is not only for the purpose of regulation. While it is true that the first part which requires the alien to secure an employment permit from the Mayor involves the exercise of discretion and judgment in processing and approval or disapproval of application is regulatory in character, the second part which requires the payment of a sum of 50.00 pesos is not a regulatory but a revenue measure. Ordinance no. 6537 is void and unconstitutional. This is tantamount to denial of the basic human right of the people in the Philippines to engaged in a means of livelihood. While it is true that the Philippines as a state is not obliged to admit aliens within it's territory, once an alien is admitted he cannot be deprived of life without due process of law. This guarantee includes the means of livelihood. Also it does not lay down any standard to guide the City Mayor in the issuance or denial of an alien employment permit fee.

Buck vs. bell Facts of the Case Carrie Buck was a feeble minded woman who was committed to a state mental institution. Her condition had been present in her family for the last three generations. A Virginia law allowed for the sexual sterilization of inmates of institutions to promote the "health of the patient and the welfare of society." Before the procedure could be performed, however, a hearing was required to determine whether or not the operation was a wise thing to do. Question

Did the Virginia statute which authorized sterilization deny Buck the right to due process of the law and the equal protection of the laws as protected by the Fourteenth Amendment? Conclusion The Court found that the statute did not violate the Constitution. Justice Holmes made clear that Buck's challenge was not upon the medical procedure involved but on the process of the substantive law. Since sterilization could not occur until a proper hearing had occurred (at which the patient and a guardian could be present) and after the Circuit Court of the County and the Supreme Court of Appeals had reviewed the case, if so requested by the patient. Only after "months of observation" could the operation take place. That was enough to satisfy the Court that there was no Constitutional violation. Citing the best interests of the state, Justice Holmes affirmed the value of a law like Virginia's in order to prevent the nation from "being swamped with incompetence . . . Three generations of imbeciles are enough."

KWONG SING VS. CITY OF MANILA [41 Phil 103; G.R. No. 15972; 11 Oct 1920] Friday, January 30, 2009 Posted by Coffeeholic Writes Labels: Case Digests, Political Law Facts: Kwong Sing, in his own behalf and of other Chinese laundrymen who has general and the same interest, filed a complaint for a preliminary injunction. The Plaintiffs also questioned the validity of enforcing Ordinance No. 532 by the city of Manila. Ordinance No. 532 requires that the receipt be in duplicate in English and Spanish duly signed showing the kind and number of articles delivered bylaundries and dyeing and cleaning establishments. The permanentinjunction was denied by the trial court. The appellants claim is thatOrdinance No. 532 savors of class legislation; putting in mind that they are Chinese nationals. It unjustly discriminates between persons in similar circumstances; and that it constitutes an arbitrary infringement of property rights. They also contest that the enforcement of the legislation is an act beyond the scope of their police power. In view of the foregoing, this is an appeal with the Supreme Court.

Issues: (1) Whether or Not the enforcement of Ordinance no, 532 is an act beyond the scope of police power (2) Whether or Not the enforcement of the same is a class legislationthat infringes property rights.

Held: Reasonable restraints of a lawful business for such purposes are permissible under the police power. The police power of the City of Manila to enact Ordinance No. 532 is based on Section 2444, paragraphs (l) and (ee) of the Administrative Code, as amended by Act No. 2744, authorizes the municipal board of the city of Manila, with the approval of the mayor of the city: (l) To regulate and fix the amount of the license fees for the following: xxxx xxxxxlaundries xxxx. (ee) To enact all ordinances it may deem necessary and proper for the sanitation and safety, the furtherance of the prosperity, and thepromotion of the morality, peace, good order, comfort, convenience, and general welfare of the city and its inhabitants.

The court held that the obvious purpose of Ordinance No. 532 was to avoid disputes between laundrymen and their patrons and to protect customers of laundries who are not able to decipher Chinese characters from being defrauded. (Considering that in the year 1920s, people of Manila are more familiar with Spanish and maybe English.)

In whether the ordinance is class legislation, the court held that theordinance invades no fundamental right, and impairs no personal privilege. Under the guise of police regulation, an attempt is not made to violate personal property rights. The ordinance is neither discriminatory nor unreasonable in its operation. It applies to all publiclaundries without distinction, whether they belong to Americans, Filipinos, Chinese, or any other nationality. All, without exception, and each every one of them without distinction, must comply with theordinance. The obvious objection for the implementation of theordinance is based in sec2444 (ee) of the Administrative Code. Although, an additional burden will be imposed on the business and occupation affected by the ordinance such as that of the appellant by learning even a few words in Spanish or English, but mostly Arabic numbers in order to properly issue a receipt, it seems that the same burdens are cast upon the them. Yet, even if private rights of person or property are subjected to restraint, and even if loss will result to individuals from the enforcement of the ordinance, this is not sufficient ground for failing to uphold the power of the legislative body. The very foundation of the police power is the control of private interests for the public welfare.

Finding

that

the ordinance is

valid,

judgment

is

affirmed,

and

the

petition

for

preliminary injunction is denied, with costs against the appellants.

Yu Cong Eng Vs. Trinidad Case Digest Yu Cong Eng Vs. Trinidad 47 Phil 385 G.R. No. 20479 February 6, 1925 Facts: The petitioner, Yu Cong Eng, was charged by information in the court of first instance of Manila, with a violation of Act 2972, which provides that (Section 1) it shall be unlawful for any person, company, or partnership or corporation engaged in commerce, industry or any other activity for the purpose of profit in the Philippine Islands, in accordance with existing law, to keep its account books in any language other than English, Spanish or any local dialect. He was arrested, his books were seized, and the trial was about to proceed, when he and the other petitioner, Co Liam, on their own behalf, and on behalf of all the other Chinese merchants in the Philippines, filed the petition against the fiscal, or prosecuting attorney of Manila, and the collector of internal revenue engaged in the prosecution, and against the judge presiding. Issue: Whether or Not Act 2972 is unconstitutional. Held: Yes. The Philippine government may make every reasonable requirement of its taxpayers to keep proper records of their business transactions in English or Spanish or Filipino dialect by which an adequate measure of what is due from them in meeting the cost of government can be had. But we are clearly of opinion that it is not within the police power of the Philippine Legislature, because it would be oppressive and arbitrary, to prohibit all Chinese merchants from maintaining a set of books in the Chinese language, and in the Chinese characters, and thus prevent them from keeping advised of the status of their business and directing its conduct.

Ichong vs Hernandez Case Digest LAO H. ICHONG, in his own behalf and in behalf of other alien residents, corporations and partnerships adversely affected. by Republic Act No. 1180, petitioner , vs. JAIME HERNANDEZ, Secretary of Finance, andMARCELINO SARMIENTO, City Treasurer of Manila,

respondents.

G.R. No. L-7995 May 31, 1957 FACTS: Republic Act No. 1180 is entitled "An Act to Regulate the Retail Business." In effect it nationalizes the retail trade business. The main provisions of the Act are: (1) a prohibition against persons, not citizens of the Philippines, and against associations, partnerships, or corporations the capital of which are not wholly owned by citizens of the Philippines, from engaging directly or indirectly in the retail trade; (2) an exception from the above prohibition in favor of aliens actually engaged in said business on May 15, 1954, who are allowed to continue to engaged therein, unless

their licenses are forfeited in accordance with the law, until their death or voluntary retirement in case of natural persons, and for ten years after the approval of the Act or until the expiration of term in case of juridical persons; (3) an exception there from in favor of citizens and juridical entities of the United States; (4) a provision for the forfeiture of licenses for violation of the laws on nationalization, control weights and measures and labor and other laws relating to trade, commerce and industry; (5) a prohibition against the establishment or opening by aliens actually engaged in the retail business of additional stores or branches of retail business, (6) a provision requiring aliens actually engaged in the retail business to present for registration with the proper authorities a verified statement concerning their businesses, giving, among other matters, the nature of the business, their assets and liabilities and their offices and principal offices of judicial entities; and (7) a provision allowing the heirs of aliens now engaged in the retail business who die, to continue such business for a period of six months for purposes of liquidation. Petitioner, for and in his own behalf and on behalf of other alien resident,s corporations and partnerships adversely affected by the provisions of Republic Act. No. 1180, brought this action to obtain a judicial declaration that said Act is unconstitutional, and to enjoin the Secretary of Finance and all other persons acting under him, particularly city and municipal treasurers, from enforcing its provisions. Petitioner attacks theconstitutionality of the Act, contending that it denies to alien residents the equal protection of the laws and deprives of their liberty and property without due process of law. ISSUE: Whether or not R.A. No. 1180 denies equal protection of laws and due process? HELD: The Court cited the following reason in upholding theconstitutionality and validity of R.A. No. 1180 which does not violate the equal protection of laws and due process. We hold that the disputed law was enacted to remedy a real actual threat and danger to national economy posed by alien dominance and control ofthe retail business and free citizens and country from dominance and control; that the enactment clearly falls within the scope of the police power of the State, thru which and by which it protects its own personality and insures its security and future. The present dominance of the alien retailer, especially in the big centers of population, therefore, becomes a potential source of danger on occasions of war or other calamity. We do not have here in this country isolated groups of harmless aliens retailing goods among nationals; what we have are well organized and powerful groups that dominate the distribution of goods and commodities in the communities and big centers of population. They owe no allegiance or loyalty to the State, and the State cannot rely upon them in times of crisis or emergency. While the national holds his life, his person and his property subject to the needs of his country, the alien may even become the potential enemy of the State. The law does not violate the equal protection clause of the Constitution because sufficient grounds exist for the distinction between alien and citizen in the exercise of the occupation regulated. Aliens are under no special constitutional protection which forbids a classification otherwise justified simply because the limitation of the class falls along the lines of nationality. That would be requiring a higher degree of protection for aliens as a class than for similar classes than for similar

classes of American citizens. Broadly speaking, the difference in status between citizens and aliens constitutes a basis for reasonable classification in the exercise of police power. DUE PROCESS The due process of law clause is not violated because the law is prospective in operation and recognizes the privilege of aliens already engaged in the occupation and reasonably protects their privilege; that the wisdom and efficacy of the law to carry out its objectives appear to us to be plainly evident as a matter of fact it seems not only appropriate but actually necessary and that in any case such matter falls within the prerogative of the Legislature, with whose power and discretion the Judicial department of the Government may not interfere. The guaranty of due process demands only that the law shall not be unreasonable, arbitrary or capricious, and that the means selected shall have a real and substantial relation to the subject sought to be attained. So far as the requirement of due process is concerned and in the absence of other constitutional restriction a state is free to adopt whatever economic policy may reasonably be deemed to promote public welfare, and to enforce that policy by legislation adapted to its purpose. The courts are without authority either to declare such policy, or, when it is declared by the legislature, to override it. If the laws passed are seen to have a reasonable relation to a proper legislative purpose, and are neither arbitrary nor discriminatory, the requirements of due process are satisfied, and judicial determination to that effect renders a court functus officio. . . . To justify the state in thus interposing its authority in behalf of the public, it must appear, first, that the interests of the public generally, as distinguished from those of a particular class, require such interference; and second, that the means are reasonably necessary for the accomplishment of the purpose, and not unduly oppressive upon individuals. The real question at issue, therefore, is not that posed by petitioner, which overlooks and ignores the facts and circumstances, but this, Is the exclusion in the future of aliens from the retail trade unreasonable?; Arbitrary capricious, taking into account the illegitimate and pernicious form and manner in which the aliens have heretofore engaged therein? As thus correctly stated the answer is clear. The law in question is deemed absolutely necessary to bring about the desired legislative objective, i.e., to free national economy from alien control and dominance. It is not necessarily unreasonable because it affects private rights and privileges (11 Am. Jur. pp. 1080-1081.) The test of reasonableness of a law is the appropriateness or adequacy under all circumstances of the means adopted to carry out its purpose into effect (Id.) Judged by this test, disputed legislation, which is not merely reasonable but actually necessary, must be considered not to have infringed the constitutional limitation of reasonableness. Email ThisBlogThis!Share to TwitterShare to Facebook

YNOT vs IAC Case Digest

RESTITUTO YNOT, petitioner, vs. INTERMEDIATE APPELLATE COURT, THE STATION COMMANDER, INTEGRATED NATIONAL POLICE, BAROTAC NUEVO, ILOILO and THE REGIONAL DIRECTOR, BUREAU OF ANIMAL INDUSTRY, REGION IV, ILOILO CITY, respondents. FACTS: The petitioner had transported six carabaos in a pump boat from Masbate to Iloilo on January 13, 1984, when they were confiscated by thepolice station commander of Barotac Nuevo, Iloilo, for violation of Executive Order No. 626-A which provides that the carabao or carabeef transported in violation of this Executive Order as amended shall be subject to confiscation and forfeiture by the government, to be distributed to charitable institutions and other similar institutions as the Chairman of the National Meat Inspection Commission may ay see fit, in the case of carabeef, and to deserving farmers through dispersal as the Director ofAnimal Industry may see fit, in the case of carabaos. The petitioner sued for recovery, and the Regional Trial Court of Iloilo City issued a writ of replevin upon his filing of a supersedeas bond of P12,000.00. After considering the merits of the case, the court sustained the confiscation of the carabaos and, since they could no longer be produced, ordered the confiscation of the bond. The court also declined to rule on the constitutionality of the executive order, as raise by the petitioner, for lack of authority and also for its presumed validity. The petitioner appealed the decision to the Intermediate Appellate Court,* 3 which upheld the trial court, ** and he has now come before us in this petition for review on certiorari. ISSUES: Whether or not executive order no. 626-A is unconstitutional due misapplication of police power, violation of due process, and undue delegation of legislative power? HELD: The protection of the general welfare is the particular function of the police power which both restraints and is restrained by due process. The police power is simply defined as the power inherent in the State to regulate liberty and property for the promotion of the general welfare. It is this power that is now invoked by the government to justify Executive OrderNo. 626-A, amending the basic rule in Executive Order No. 626, prohibiting the slaughter of carabaos except under certain conditions. To justify the State in thus interposing its authority in behalf of the public, it must appear, first, that the interests of the public generally, as distinguished from those of a particular class, require such interference; and second, that the means are reasonably necessary for the accomplishment of the purpose, and not unduly oppressive upon individuals. In the light of the tests mentioned, we hold with the Toribio Case that there is no doubt that by banning the slaughter of these animals except where they are at least seven years old if male and eleven years old if female upon issuance of the necessary permit, the executive order will be conserving those still fit for farm work or breeding and preventing their improvident depletion. But while conceding that the amendatory measure has the same lawful subject as the original executive order, we cannot say with equal certainty that it complies with the second requirement, viz., that there be a lawful method. We note that to strengthen the original measure, Executive OrderNo. 626-A imposes an absolute ban not on the slaughter of the carabaos

but on their movement, providing that "no carabao regardless of age, sex, physical condition or purpose (sic) and no carabeef shall be transported from one province to another." The object of the prohibition escapes us. The reasonable connection between the means employed and the purpose sought to be achieved by the questioned measure is missing. We do not see how the prohibition of the inter-provincial transport of carabaos can prevent their indiscriminate slaughter, considering that they can be killed anywhere, with no less difficulty in one province than in another. Obviously, retaining the carabaos in one province will not prevent their slaughter there, any more than moving them to another province will make it easier to kill them there. As for the carabeef, the prohibition is made to apply to it as otherwise, so says executive order, it could be easily circumvented by simply killing the animal. Perhaps so. However, if the movement of the live animals for the purpose of preventing their slaughter cannot be prohibited, it should follow that there is no reason either to prohibit their transfer as, not to be flippant dead meat. Even if a reasonable relation between the means and the end were to be assumed, we would still have to reckon with the sanction that the measure applies for violation of the prohibition. The penalty is outright confiscation of the carabao or carabeef being transported, to be meted out by the executive authorities, usually the police only. In the Toribio Case, the statute was sustained because the penalty prescribed was fine and imprisonment, to be imposed by the court after trial and conviction of the accused. Under the challenged measure, significantly, no such trial is prescribed, and the property being transported is immediately impounded by the police and declared, by the measure itself, as forfeited to the government. This measure deprives the individual due process as granted by the Constitution. The due process clause was kept intentionally vague so it would remain also conveniently resilient. This was felt necessary because due process is not, like some provisions of the fundamental law, an "iron rule" laying down an implacable and immutable command for all seasons and all persons. Flexibility must be the best virtue of the guaranty. The very elasticity of the due process clause was meant to make it adapt easily to every situation, enlarging or constricting its protection as the changing times and circumstances may require. Aware of this, the courts have also hesitated to adopt their own specific description of due process lest they confine themselves in a legal straitjacket that will deprive them of the elbow room they may need to vary the meaning of the clause whenever indicated. The minimum requirements of due process are notice and hearing which, generally speaking, may not be dispensed with because they are intended as a safeguard against official arbitrariness. It is a gratifying commentary on our judicial system that the jurisprudence of this country is rich with applications of this guaranty as proof of our fealty to the rule of law and the ancient rudiments of fair play. It has already been remarked that there are occasions when notice and hearing may be validly dispensed with notwithstanding the usual requirement for these minimum guarantees of due process. It is also conceded that summary action may be validly taken in administrative proceedings as procedural due process is not necessarily judicial only. In the exceptional cases accepted,

however. there is a justification for the omission of the right to a previous hearing, to wit, the immediacy of the problem sought to be corrected and the urgency of the need to correct it. In the case before us, there was no such pressure of time or action calling for the petitioner's peremptory treatment. The properties involved were not even inimical per se as to require their instant destruction. There certainly was no reason why the offense prohibited by the executive order should not have been proved first in a court of justice, with the accused being accorded all the rights safeguarded to him under the Constitution. Considering that, as we held in Pesigan v. Angeles, 21 Executive Order No. 626-A is penal in nature, the violation thereof should have been pronounced not by the police only but by a court of justice, which alone would have had the authority to impose the prescribed penalty, and only after trial and conviction of the accused. To sum up then, we find that the challenged measure is an invalid exercise of the police power because the method employed to conserve the carabaos is not reasonably necessary to the purpose of the law and, worse, is unduly oppressive. Due process is violated because the owner of the property confiscated is denied the right to be heard in his defense and is immediately condemned and punished. The conferment on the administrative authorities of the power to adjudge the guilt of the supposed offender is a clear encroachment on judicial functions and militates against the doctrine of separation of powers. There is, finally, also an invalid delegation of legislative powers to the officers mentioned therein who are granted unlimited discretion in the distribution of the properties arbitrarily taken. For these reasons, we hereby declare Executive Order No. 626-A unconstitutional.

Javier vs. Comelec

Facts: Alleging serious anomalies in the conduct of election and canvass of election returns, the private petitioner filed a motion before the respondent to prohibit the proclamation of his rival, respondent Pacificador in the election of Antique (Assembly Member). However, the respondent Comelec proclaims the respondent Pacificador as the rightful winner in the held elections. The private respondent then filed a petition to annul the said decision of the Comelec. In the said decision, Comm. Opinion was asked to inhibit himself to participate in the hearing of the case filed in the ground that he was a former law firm partner of the respondent Pacificador, however, he refused and even objected to transfer the hearing of such case to other division of Comelec.

Issue:

Was the refusal of Comm. Opinion to inhibit himself in participation of the case a breach to due process?

Held: Yes. The spirit of due process is akin to the spirit of fair play. Due process requires that every party in a litigation is entitled to an impartial judge to assure that the decision is just and to protect the rights of every litigant. Fair play calls for equality of justice. Thus there cannot be equal justice if a judge is already committed to the other party, thus, a relationship between a judge and a party may give color and distort the rendering of a just decision and the this is a clear manifestation of an impartial judge, and would be a result of breach of due process law. In the case at bar, there is no fair play in the case. The action of Comm. Opinion, and his relationship with the respondent Pacificador tarnished the right of due process of the petitioner as he gave much more weight to such relationship rather than abiding the well-known rule of judicial conduct of fair play and impartiality. Indeed, it resulted into a unjust judgment prejudicial to the petitioner. The Comm could have just inhibit himself out of delicadeza in order to promote due process in a judicial proceeding.

Paderanga vs. Azura

Facts: The petitioner filed an administrative charges against the respondent judge alleging that the latter committed a grave abuse of discretion amounting to lack or excess of jurisdiction by denying the motion for inhibition filed by the petitioner inhibiting the respondent judge to take cognizance of the pending administrative charges where officials of the City of Gingoog are the parties. The loss of trust and confidence to the respondent judge to render impartial and just trials, bias and oppressive dispensation of justice and issuing orders against the interest of the city are the grounds of the motion for inhibition filed by the petitioner.

Issue: Base on the positions and imputations of the parties against each other, should the respondent judge inhibit himself in taking cognizance of the pending administrative charges involving city officials to uphold the spirit of due process?

Held: Yes. The spirit of due process calls for an impartiality and cold-neutrality of a judges in order to uphold justice and protect the integrity of the judiciary. A judge is not legally prohibited to hear cases, but if circumstances may incite his integrity and compromise the trust of the people to the judiciary, he may conduct a careful self-examination and may choose to inhibit himself to take cognizance of such cases, consequently to uphold due process.

David vs. Aquilizan

Facts: The Jugar brothers, shared tenants of the petitioner contended that they were refused by David to be reinstated in his land to cultivate corn crops. As a result, the Jugar brothers filed a petition for reinstatement before the Ministry of Agrarian Reform. The respondent judge later without conducting any hearing rendered judgment declaring the Jugar Brothers tenants of the land of David and by virtue of PD 27, declared the Jugar brothers owners of the land. The petitioner filed am original Action with certiorari and preliminary injunction before the Supreme court contending that his right of due process were deprived by the respondent by rendering judgment without considering the petitioners right to notice and hearing.

Issue: Does rendering judgment without due hearing a breach of right to due process?

Held: Yes. As stated by the Banco Filipino Case, the defendant should be given opportunity to be heard and that judgment should be rendered upon lawful hearing, these two elements are indispensable for the protection of every persons right to due process. Thus, a person should have the assurance of notice and hearing and judgment of the courts should be derived from a lawful hearing. In the case at bar, these two elements are wanting and thus, resulted into judicial usurpation and oppression, violative of the petitioners right to due process.

DEVELOPMENT BANK OF THE PHILIPPINES, plaintiff-appellant, vs. LOURDES GASPAR BAUTISTA, THE DIRECTOR OF THE LANDS and THE NATIONAL TREASURER OF THE PHILIPPINES, defendants-appellees.

Jesus A. Avancea for plaintiff-appellant. Lourdes Gaspar Bautista in her own behalf as defendant-appellee. Assistant Solicitor General Antonio Torres, Solicitor Francisco J. Bautista and Special Attorney Daniel G. Florida for defendants-appelles Director of Lands, et al.
FERNANDO, J.: The question this appeal from a judgment of a lower court presents is one that possesses both novelty and significance. It is this: What is the right, if any, of a creditor which previously satisfied its claim by foreclosing extrajudicially on a mortgage executed by the debtor, whose title was thereafter nullified in a judicial proceeding where she was not brought in as a party? As creditor, the Development Bank of the Philippines now appellant, filed a complaint against one of its debtors, Lourdes Gaspar Bautista, now appellee, for the recovery of a sum of money representing the unpaid mortgage indebtedness, which previously had been wiped out with the creditor bank acquiring the title of the mortgaged property in an extrajudicial sale. Thereafter, the title was nullified in a judicial proceeding, the land in question being adjudged as belonging to another claimant, without, however, such debtor, as above noted, having been cited to appear in such court action. The Development Bank was unsuccessful, the lower court being of the view that with the due process requirement thus flagrantly disregarded, since she was not a party in such action where her title was set aside, such a judgment could in no wise be binding on her and be the source of a claim by the appellant bank. The complaint was thus dismissed by the lower court, then presided by Judge, now Justice, Magno Gatmaitan of the Court of Appeals. Hence, this appeal by appellant bank. Such dismissal is in accordance with law. There is no occasion for us to repudiate the lower court.

From the very statement of facts in the brief for appellant bank, the following appears: "On or before May 31, 1949, the defendant-appellee, Lourdes Gaspar Bautista, who shall hereafter be referred to as Bautista, applied to the Government for the sale favor of a parcel of land with an area of 12 has., 44 ares, and 22 centares, located at Bo. Barbara, San Jose, Nueva Ecija. After proper investigation, Sales Patent no. V-132 covering said property was issued in her favor on June 1, 1949 (Exh. A-1) by the Director of Lands. Sales Patent No. V-132 was registered in the office of the Register of Deeds of Nueva Ecija pursuant to Section 122 of Act 496 on June 3, 1949 (Exh. A), as a result of which Original Certificate of Title No. P-389 was issued in her favor."1 How the loan was contracted by now appellee Bautista was therein set forth. Thus: "On July 16, 1949, Bautista applied for a loan with the Rehabilitation Finance Corporation (RFC), predecessor in interest of the plaintiff-appellee Development Bank of the Philippines (DBP), offering as security the parcel of land covered by O.C.T. No. P-389. Aside from her certificate of title, Bautista also submitted to the RFC other documents to show her ownership and possession of the land in question, namely, Tax Declaration No. 5153 (Exh. A-4) in her name and the blueprint plan of the land. On the basis of the documents mentioned and the appraisal of the property by its appraiser, the RFC approved a loan of P4,000.00 in favor of Bautista. On July 16, 1949, Bautista executed the mortgage contract over the property covered by O.C.T. No. P-389 and the promissory note for P4,000.00 in favor of RFC (Exhs. C and C-1), after which the proceeds of the loan were released."2 The satisfaction of the mortgage debt with the acquisition of the title to such property by appellant Bank, by virtue of an extrajudicial foreclosure sale, and such title losing its validity in view of a court proceeding, where however, appellee Bautista, was not made a party, was next taken up in the brief of plaintiff-appellant. Thus: "Bautista failed to pay the amortization on the loan so that the RFC took steps to foreclose the mortgage extra-judicially under Act 3135, as amended. In the ensuing auction sale conducted by the sheriff of Nueva Ecija on June 27, 1951, the RFC acquired the mortgaged property as the highest bidder (Exh. D). On the date of the sale, the total obligation of Bautista with the RFC was P4,858.48 (Exh. I). On July 21, 1952, upon failure of Bautista to redeem the property within the one (1) year period as provided bylaw, plaintiff-appellant RFC consolidated its ownership thereon (Exhs. E and E-I). On July 26, 1952, the Register of Deeds of Nueva Ecija cancelled O.C.T. No. P-389 and replaced it with T.C.T. No. NT-12108 in the name of the RFC (Exhs. F and F-1). On or about this time, however, an action (Civil Case No. 870) was filed by Rufino Ramos and Juan Ramos in the Court of First Instance of Nueva Ecija against the Government of the Republic of the Philippines and the RFC (as successor in interest of Bautista) claiming ownership of the land in question and seeking the annulment of T.C.T. No. 2336 in the name of the Government, O.C.T. No. P-389 in the name of Bautista and T.C.TG. No. NT-12108 in the name of the RFC. A decision thereon was rendered on June 27, 1955 (Exhs. G, G-1, and G-3) whereby the aformentioned certificates of title were declared null and void." 3 Why the complaint had to be dismissed was explained thus in the decision now on appeal: "The Court after examining the proofs, is constrained to sustain her on that; it will really appear that she had never been placed within the jurisdiction of the Nueva Ecija Court; as the action there was one to annual the title, it was an action strictly in personam, if that was the case as it was, the judgment there could not in any way bind Lourdes who had not acquired in said decision in any way for what only happened is that as to the mortgage, the Bank foreclosed, and then sold unto Conrada and when the title had been annulled, the Bank reimbursed Conrada; stated otherwise, the annulment of

Lourdes' title was a proceeding ex parte as far as she was concerned and could not bind her at all; and her mortgage was foreclosed an the Bank realized on it, when the Bank afterwards acquiesced in the annulment of the title and took it upon itself to reimburse Conrada, the Bank was acting on its own peril because it could not have by that, bound Lourdes at all."4 As stated at the outset, the decision must be affirmed. The fundamental due process requirement having been disregarded, appellee Bautista could not in any wise be made to suffer, whether directly or indirectly, from the effects of such decision. After appellant bank had acquired her title by such extrajudicial foreclosure sale and thus, through its own act, seen to it that her obligation had been satisfied, it could not thereafter, seek to revive the same on the allegation that the title in question was subsequently annulled, considering that she was not made a party on the occasion of such nullification. If it were otherwise, then the cardinal requirement that no party should be made to suffer in person or property without being given a hearing would be brushed aside. The doctrine consistently adhered to by this Court whenever such a question arises in a series of decisions is that a denial of due process suffices to cast on the official act taken by whatever branch of the government the impress of nullity.5 A recent decision, Macabingkil v. Yatco,6 possesses relevance. "A 1957 decision, Cruzcosa v. Concepcion, is even more illuminating in so far as the availability of the remedy sought is concerned. In the language of this Court, speaking through Justice J.B.L. Reyes: 'The petition is clearly meritorious. Petitioners were conclusively found by the Court of Appeals to be co-owners of the building in question. Having an interest therein, they should have been made parties to the ejectment proceedings to give them a chance to protect their rights: and not having been made parties thereto, they are not bound and can not be affected by the judgment rendered therein against their co-owner Catalino Cruzcosa. Jr. ....' Two due process cases deal specifically with a writ of execution that could not validly be enforced against a party who was not given his day in court, Sicat v. Reyes, and Hamoy v. Batingoplo. According to the former: 'The above agreement, which served as basis for the ejectment of Alipio Sicat, cannot be binding and conclusive upon the latter, who is not a party to the case. Indeed, that order, as well as the writ of execution, cannot legally be enforced against Alipio Sicat for the simple reason that he was not given his day in court.' From the latter: 'The issue raised in the motion of Rangar is not involved in the appeal for it concerns a right which he claims over the property which has not so far been litigated for the reason that he was not made a party to the case either as plaintiff for a defendant. He only came to know of the litigation when he was forced out of the property by the sheriff, and so he filed the present motion to be heard and prove his title to the property. This he has the right to do as the most expeditious manner to protect his interest instead of filing a separate action which generally is long, tedious and protracted.'" Reinforcement to the above conclusion comes from a codal provision. According to the Civil Code:7 "The vendor shall not be obliged to make good the proper warranty, unless he is summoned in the suit for eviction at the instance of the vendee. "While not directly in point, the principle on which the above requirement is based sustains the decision of the lower court. In effect, appellant bank would hold appellee Bautista liable for the warranty on her title, its annullment having the same effect as that of an eviction. In such a case, it is wisely provided by the Civil Code that

appellee Bautista, as vendor, should have been summoned and given the opportunity to defend herself. In view of her being denied her day in court, it would to be respected, that she is not "obliged to made good the proper warranty." In the suit before the lower court, the Director of Lands and the National Treasurer of the Philippines were likewise made defendants by appellant bank because of its belief that if no right existed as against appellee Bautista, recovery could be had from the Assurance Fund. Such a belief finds no support in the applicable, law, which allows recovery only upon a showing that there be no negligence on the part of the party sustaining any loss or damage or being deprived of any land or interest therein by the operation of the Land Registration Act. 8 This certainly is not the case here, plaintiff-appellant being solely responsible for the light in which it now finds itself. Accordingly, the Director of Lands and the National Treasurer of the Philippines are likewise exempt from any liability. WHEREFORE, the judgment appealed from is affirmed, with costs against the Development Bank of the Philippines.

G.R. No. L-37051 August 3l, 1977 ANITA U. LORENZANA, petitioner, vs. POLLY CAYETANO and COURT OF APPEALS, respondents.

Desiderio P. Jurado for petitioner. Vicente L. Santiago for private respondent.

GUERRERO, J.: Appeal by certiorari from the judgment of the Court of Appeals in CA-G.R. No. 31082-R entitled "Polly Cayetano, Plaintiff-Appellant vs. Anita U. Lorenzana, et al., Defendants-Appellees" and from the resolution of the Court denying petitioner's motion for reconsideration. We find in this case a perfect example that proves the -validity of that classic legal dictum that a man's house is his castle where the wind may enter, the rain may enter but neither the King nor the King's men may enter without the consent of the owner. The records show that 'In 1958, petitioner filled n the Municipal Court of Manila ejectment cases for non-payment of rentals against her tenants occupying different stalls in that quonset hut situated in the San Lazaro Estate (corner of C.M. Recto St. and Quezpn Blvd., Manila, adjacent to the Bilibid Compound) with a floor area of 360 square meters. leased by her (which she afterwards purchased) from the Manila Railroad Company and later from the Bureau of Lands together with the

use of the land north and wouth of the quonset hut with an area of 340 square meters. The private respondent, on the other hand, occupied the area north of the quonset hut which area was also leased by her from the Manila Railroad Company and subsequently from the Bureau of Lands, and on which her house stood. Hence, the areas occupied by the two principal protagonists are adjacent to each other. The ejectment. cases having been decided by the Municipal Court in favor of the petitioner, the same were appealed to the Court of First Instance of Manila, Branch I. The Court affirmed the decision of the municipal court and ordered the defendants-tenants to vacate the premises leased. Upon refusal of the tenants to vacate the premises, the court granted a partial execution of the judgment and on July 20, 1959, a writ of demolition was issued, specifically commanding the Sheriff of Manila "to demolish the premises subject of the above-name cases" (Record on Appeal, p. 4). Thereupon on July 27, 1959, Petitioner together with her counsel, Atty. Nereo Paculdo and Deputy Sheriff Jose L. Cruz proceeded and entered the premises of the respondent and in spite of her protests that she was not a party to the ejectment cases in which the demolition order was secured and that her premises was not subject of said ejectment cases, they destroyed the latter's fence including flower pots trellises and electric installations and carted away the materials thereof and built another fence 5 meters into the premises of the respondent, boring holes into the cemented garden or patio of her house. On August 3, 1959, respondent presented to the court a motion to declare petitioner, her counsel and the sheriff guilty of contempt; that they be punished and held liable in damages to the petitioner. The presiding judge held the motion in abeyance until the decision of the court in the ejectment cases shall have been rendered. Acting upon the petitioner's ex-parte motion and urgent motion for demolition in the two appealed ejectment cases, Civil Case No. 29664 and Civil Case No. 29665, the court on September 28, 1959 ordered that "a writ of demolition be issued ordering the Sheriff of Manila or any of his deputies to demolish any or all improvements erected and existing on the parcel of land subject of the above- entitled cases. which consists of an area of about 700 square meters." (Record on Appeal, p. 55). The writ of demolition was issued by the Sheriff on September 30, 1959. Upon procurement of this order or demolition, petitioner, together with her counsel and the deputy sheriff proceeded once more to respondent's premises on October 1, 1959 and moved the fence where it was illegally placed by them on July 27, 1959. On the same day, October 1, 1959, respondent filed an urgent motion for the suspension of the execution of the writ of demolition, which motion was denied by the court the next day, October 2, 1959. The records further establish that on November 27, 1959, petitioner, her lawyer, Atty. Paculdo, and Sheriff Cruz went back and moved the fence 1 Meter more into the premises of the respondent; that on February 19, 1960, the respondent filed an ex-parte motion to withdraw the petition for contempt on the ground that "conferring with Judge Bayona after this petition was heard, the petitioner was informed that not being a party to the above-numbered cases, she is like an intruder to act on her petition." (Record on Appeal, p. 80).

On October 1, 1959, the respondent Polly Cayetano filed in the Court of First Instance of Manila, Civil Case No. 42001 against the petitioner Anita U. Lorenzana, Atty. Nereo J. Paculdo and Deputy Sheriff Jose L. Cruz for damages with mandatory injunction. The defendants therein filed a motion to dismiss, which was opposed by the plaintiff, and the Court, Branch XVII, denied on December 19, 1959 the motion to dismiss and the petition for issuance of the writ of preliminary injunction. The defendants filed their answers. Under date of March 9, 1962, the Court issued the Decision dismissing the complaint of the plaintiff as well as the counterclaim of the defendants Anita U. Lorenzana and Atty. Nereo J. Paculdo for lack of sufficient evidence. A motion for reconsideration was filed by the plaintiff but denied by the Court. Not satisfied with the Decision of the Court, Polly Cayetano appealed to the Court of Appeals. The Court of Appeals reversed the decision appealed from, and ordered "defendant-appellee Lorenzana to restore to appellant the possession of the property invaded and occupied by her as shown in Exh. L-1 to L-4; to put back appellant's fence and other valuable improvements in their place before the writ of demolition was served; ordering defendants, Lorenzana and Cruz, to pay jointly and severally to the plaintiff-appellant the sum of P5,500.00 as actual and moral damages, and pay the costs, except defendant, Paculdo." The above Decision is now sought to be reviewed in the instant petition for certiorari upon the following assignment of errors: 1. That the Court of Appeals erred in holding that the writ of demolition issued by Branch I of the Court of First Instance of Manila presided over by Judge Bayona could not be legally effected against respondent Polly Cayetano; II. That the Court of Appeals erred in holding that the private respondent's failure to pursue her remedy before a higher court did not to amount a waiver of her rights; III. The Court of Appeals erred in holding in effect that a writ of execution and an order of demolition can be collaterally attacked in an action specifically brought for recovery of damages; and IV. The Court of Appeals erred in holding that the issuance of the writ of demolition by Judge Bayona was in violation of Section 14, Rule 39. This case hinges on the legal effects of the writs of demolition issued in the ejectment cases wherein the respondent was not a party thereto . The writs were issued by virtue of the judgment rendered by the Court of First Instance of Manila (Branch I), the dispositive portion of which states, as follows: "WHEREFORE, judgment is rendered condemning the defendants ... to vacate the premises; ordering herein defendants... to pay rent to plaintiff ... plus attorney's fees and costs." The petitioner contends that the respondent having voluntarily appeared before the court and invoked its jurisdiction seeking affirmative relief by filing on August 3, 1959, a petition to declare Lorenzana, Atty. Paculdo and Sheriff Cruz in contempt and holding them liable in damages, and by filing on October 1, 1959, an urgent petition for the suspension of the execution of the writ of demolition, she could no longer contest the efficacy of the writ. There is no merit to this contention and We find no error in the ruling of the Court of Appeals that the writ of demolition could not be legally effected against the respondent. It must be noted that respondent was not a party to any of the 12 ejectment cases wherein the writs of demolition had been issued; she did not make her appearance in and during the pendency of these ejectment cases. Respondent only went to court to protect her property from demolition after the judgment in the ejectment cases had become final and executory. Hence, with respect to

the judgment in said ejectment cases, respondent remains a third person to such judgement, which does not bind her; 1 nor can its writ of execution be enforced against her since she was not afforded her day in court in said ejectment cases. 2 The vital legal point here is that respondent did not derive her right or interest from the defendants-tenants nor from the plaintiff-landlord (the herein petitioner) but from the Bureau of Lands from which she had leased the property. She is neither a party nor successor in interest to any of the litigants in the ejectment cases. We also find no merit in the contention of the petitioner that respondent having been duly heard by the Court, she was not deprived of her day in court and was accorded the due process of law. It cannot be said that the constitutional requirements of due process were sufficiently complied with because the respondent had been duly heard. Indeed, respondent was heard but simply hearing her did not fulfill the basic conditions of procedural due process in courts. When respondent appeared before the court to protect and preserve her property, the Court had not lawfully acquired jurisdiction over the property of the respondent because the premises of the respondent was not included in the ejectment cases and the judgment in said cases could not affect her property, much less demolish the same. In the leading case of El Banco-Espa;ol-Filipino v. Palanca 3 cited in Macabingkil v. Yatco, et al., 4 We laid down the court's constitutional requirements of due process, thus As applied to judicial proceedings. . . it may be laid down with certainty that the requirements of due process is satisfied if the following conditions are present namely: (1) There must be a court or tribunal clothed with judicial power to hear and determine the matter before it; (2) jurisdiction must be lawfully acquired over the person of the defendant or over the property which is the subject of the proceedings: (3) the defendant must be given an opportunity to be heard; and (4) judgment must be rendered upon lawful hearing. Respondent pursued various steps to protect her property from the invasion and encroachment of the petitioner, abetted by her counsel and the deputy Sheriff. She filed a motion for contempt; she protested to the Sheriff of Manila; she appealed to the Director of the Bureau of Lands; she filed an urgent motion to suspend the writ of demolition. Although the motions for contempt and for suspension wer heard by the court, such action s taken af ter the jugdgment had become final and executory did not make the respondent a party litigant in the ejectment cases. The respondent remained a stranger to the case and she cannot be bound by the judgment rendered therein, nor by the writs of execution and demolition issued in pursuance to said judgment. Intervening as a prejudiced owner of improvements being wrongly demolished merely to oppose such order of demolition upon learning that the said order was directed against premises not her own, is not the same as being a party to the suit to the extent of being bound by the judgment in the case where such order of demolition was issued. 5Furthermore, it must be noted that said petitions were filed after the promulgation of the decision in the ejectment cases and while in the process of execution. lt. is not proper to speak of an intention in a case already terminated by final judgment . 6

Respondent, not being bound thereby, may avail herself of the proper action afforded by Section 17, Rule 39 of the Revised Rules of Court which provides the proceedings where property levied upon is claimed by a third person, stating as follows: ...Tile officer is not liable for damages, for the taking or keeping of the property to any third-party claimant unless a claim is made by the latter- and unless an action for damages is brought by him against the officer within one hundred twenty (120) days from the date of the filing of the bond .

But nothing herein contained shall prevent such claimant o any third person ffrom windicating his claim to the property by any proper action... (Emphasis supplied)

Respondent acted within and exercised her right when she filed the proper action to vindicate her claim afforded to her by Sec. 17, Rule 39 of the Revised Rules of Court, against the instruders or trespassers before the Court of First Instance of Manila, Branch XVII, in Civil Case No. 42001 for dam with mandatory injunction. If she did not insist on her motion for contempt which the court held in abeyance and was later withdrawn by her, if she did not appeal from the order of the court denying her motion to suspend the writ of demolition, such failure did not amount to a waiver of her right to pursue the proper action or remedy provided to her by the Rules of Court. It is of no moment that the respondent did not file a motion to quash the writ of execution or file a petition for relief under Rule 38 of the Revised Rules of Court or file a petition for certiorari and prohibition with a higher court after her petition to suspend the writ of demolition had been denied as suggested by petitioner. The law has specifically given her the remedies to vindicate her claim to the property. When the property of one person is unlawfully taken by another, the former has a right of action against the latter for the recovery of the property or for damages for the taking or retention, and he is entitled to his choice of these two remedies. 7 We find no legal compulsion for respondent to pursue the remedies suggested by the petitioner, for the rights of a third party claimant should not be decided in the action where the third-party claim has been presented, but in a separate action to be instituted by the third person. 8 In Queblar v. Gardu;o 9 this Court held that: Strictly speaking, the appeal interposed by the third-party claimant- appellant is improper, because she was not one of the parties in the action who were exclusively Venancio Queblar as plaintiff and Leonardo Gardu;o as defendant. Considering the provisions of said section 451 of the Code of Civil Procedure, as amended by Act No. 4108, the appealed order was not appealable. The appeal that should have been interposed by her, if the term "appeal" may properly be employed, is a separate reivindicatory action against the execution creditor or the purchaser of her property after the sale at public auction, or a complaint for damages to be charged against the bond filed by the judgment creditor in favor of the sheriff. In Potenciano v. Dineros,
10

We ruled that:

We see no merit in the claim that the denial or dismissal of Potenciano's claim in the court below constitutes a bar to the present action. Potenciano, it is true, did not appeal, from the disapproval of his claim. But it should be borne in mind that appeal is not proper in such cases. (Queblar v. Gardu;o supra). As was said in that case, the

appeal that should be interposed "if the term 'appeal' may properly be employed, is a separate reivindicatory action against the execution creditor or the purchaser of the property after the sale at public auction, or complaint for damages to be charged against the bond filed by the judgment creditor in favor of the sheriff." Such reivindicatory action is resurged to the third-party claimant by Section 15 (now 17) of Rule 39 despite disapproval of his claim by the court itself. (Planas v. Madrigal & Co., supra; Lara v. Bayona, L-7920, May 10, 1955), and it is the action availed by Potenciano in this case. The petitioner contends that a writ of execution and an order of demolition cannot be collaterally attacked in an action specifically brought for recovery of damages, and that said action for damages and mandatory injunction (Civil Case No. 42001) filed by the respondent with Branch XVII was nothing less than an action to review the validity of the order of demolition issued by Branch I in the ejectment cases which have long become final. We are not in accord with this contention. The civil case filed by the respondent for damages and the restoration of the property destroyed aid her premises taken unlawfully under the writ of demolition was not brought to reverse, impugn or set aside the judgment in the ejectment cases but to declare that the writ of demolition should not have been applied to that portion of the land and the building occupied by her, as correctly stated by the Court of Appeals. To put it succinctly the judgment and the demolition orders were valid and binding to the tenants but not to the respondent and her property. Fundamentally, it is the wrongful execution of the judgment and the writ that is the basis of the claim for damages. If the judgment and the writs of execution and demolition were alleged in the complaint for damages, this was not necessarily a collateral attack on said processes of another branch of the Court but averments to prove the wrongful, illegal and unauthorized exercise of the writs; it is merely a statement of the legal basis which the sheriff exceeded, abetted by the petitioner. The contention of the petitioner that a branch of a Court of First Instance cannot interfere with or nullify decisions, orders or proceedings of another branch of the same court and therefore the writs of execution and demolition cannot be impugned is not exactly on all fours with and hence not applicable to the case at bar. The settled rule has been clearly laid down in Abiera v. Court of Appeals, 11 wherein the Court, after a review of the doctrines inCabigao v. Del Rosario & Lim, 44 Phil. 192; Manila Herald Publishing Co., Inc., v. Ramos, 88 Phil. 94; Hacbang, et al. v. Hon. Clementino Diez, 8 SCRA 103 (May 30,1963) and National Power Corporation v. Hon. Jesus de Veyra 3 SCRA 646 (Dec. 22,1961), held that No court has power to interfere by injunction with the judgments or decrees of a court of concurrent or coordinate jurisdiction having equal power to grant the relief sought by injunction. For this doctrine to apply, the injunction issued by one court must interfere with the judgment or decree issued by another court of equal or coordinate jurisdiction and the relief sought by such injunction must be one which could be granted by the court which rendered the judgment or issued the decree.

Under Section 17 of Rule 39 a third person who claims property levied upon on execution may vindicate such claim by action. A judgment rendered in his favor declaring him to be the owner of' the property would not constitute interference with the powers or processes of the court which rendered the judgment to enforce which the execution was levied. If that be so and it is so because the property, being that of a stranger, is not subject to levy then an interlocutory order, such as injunction, upon a claim and prima facie showing of ownership by the claimant, cannot be considered as such interference either The right of a person who claims to be the owner of property levied upon on execution to file a third-party claim with the sheriff is not exclusive, and he may file an action to vindicate his claim even if the judgment creditor files an indemnity bond in favor of the sheriff to answer for any damages that may be suffered by the third-party claimant. By "action," as stated in the Rule, what is meant is a separate and independent action. With respect to the fourth assignment of error, petitioner's contention appears to be quite tenable in that under See. 14, Rule 39 of the Revised Rules of Court which the Court of Appeals applied, the notice required before demolition of the improvements on the property subject of the execution, is notice to the judgment debtor, and not to a stranger or third party to the case like the private respondent herein. Nonetheless, the claim that the Court of Appeals misconstrued the aforecited Rule is as immaterial and inconsequential as the application of this legal provision is superflous and unnecessary for the affirmance of the Court's decision. The Manifestation filed by petitioner in the records dated June 1, 1977 with Annexes A, B, C and D, is Noted. IN VIEW OF ALL THE FOREGOING, the petition herein is dismissed, and the appealed judgment is affirmed, with costs against petitioner. SO ORDERED. pp. vs beriales Facts: A case of three men who were charged for the murder of Saturnina on Sept. 13, 1974. During the hearing on Nov. 26, 1974, upon motion of the defense the Court ordered the reinvestigation of the case pending submission of the Fiscal of its reports. Couple of postponements was made until Dec. 13, 1974 hearing when the Court proceeded with the arraignment and trial in the absence of the Fiscal and its report on re-investigation, and over the disagreement of the defense. The CFI of Leyte relied on the private prosecutor being authorized by the Fiscal to present evidence and the defense presumed to have waived its right over its disagreement. Trial then proceeded and the 3 found guilty of he offense. Thus, this appeal on the constitutional requirement of due process.

Issue: Whether or not due process of law had been observed.

Held: Constitutional due process was violated, thus, case remanded to CFI for arraignment and trial. Court should have held in abeyance the trial while the report on e-investigation was still pending. Consistent disregard of the defense objection on the arraignment, trial, presentation of private prosecutors evidence, and rendition of judgment violates due process. Prosecutor or Fiscal entrusted with the investigation is duty bound to take charge until final termination. They shall have direction and control of the criminal prosecution over private prosecutors.

REPUBLIC OF THE PHILIPPINES, petitioner, vs. SANDIGANBAYAN (Second Division), IMELDA R. MARCOS AND ESTATE/HEIRS OF THE LATE FERDINAND E. MARCOS, respondents.

M.M. Lazaro & Associates for respondent Imelda R. Marcos.

R E S O L U T I O N

BELLOSILLO, J.: Challenged in this petition for certiorari (with prayer for writ of preliminary injunction or temporary restraining order) is the resolution of public respondent Sandiganbayan (Second Division) dated 28 October 1992 1 which lifted its order of default of 6 April 1989 against private respondent Imelda R. Marcos in connection with the now well-known "ill-gotten wealth" cases pending before said court as well as the resolution of 6 January 1993 2 denying the motion to reconsider the order of 28 October 1992. The Republic of the Philippines states assiduously that private respondent moved to regain her standing in court only on 8 July 1992, thereby incurring unreasonable delay, as demonstrated by the following circumstances: (a) The late Ferdinand E. Marcos died on 28 September 1989 and after his interment his widow, private respondent Imelda R. Marcos, was reasonably expected to regain her composure to enable her to attend to her cases; (b) She was exonerated in the racketeering case before the Southern District Court of New York on 2 July 1990 so that much of what public respondent considered as "abnormal burden" had "simply vanished or faded away"; and, (c) Upon her return to the Philippines in November 1991, she had every opportunity to personally take care of her cases being then fully aware of their pendency since 1987. From the moment she arrived, due diligence and reasonable promptness should have impelled her to take concrete steps in this regard; instead, she ran for the highest office of the land hoping that should she be successful in her bid all the cases against her would be rendered moot.

Petitioner likewise disputes the finding of the Sandiganbayan that private respondent has prima facie meritorious defenses. Petitioner further claims that res judicata has set in because the ruling in Imelda R. Marcos v. Presiding Justice Garchitorena, 3 has definitely settled the validity of the default order against private respondent. We find no grave abuse in the exercise of public respondent's discretion under review.

First. Prefatorily, we shall resolve the claim of petitioner that the Imelda R. Marcos v. Presiding Justice Garchitorena cases have finally resolved the issue of whether the order of default was

valid. It must be stressed that the resolution in said cases is conclusive only with respect to the default order for failure of the Marcoses to file their answer within sixty (60) days from 10 November 1988, the date the alias summonses were served. In other words, the central issue in those cases was whether there was valid service of summonses upon them in Hawaii. In the case at bench, we are asked to rule on the propriety of the grounds and circumstances set forth by private respondent to justify her failure to file her answers, which the Sandiganbayan considered as meritorious when it lifted the default order on 28 October 1992. As the causes of action are different, res judicata cannot be invoked.

Second. Sec. 3, Rule 18, of the Rules of Court provides that "[a] party declared in default may at

any time after discovery thereof and before judgment file a motion under oath to set aside the order of default upon proper showing that his failure to answer was due to fraud, accident, mistake or excusable neglect and that he has a meritorious defense. . . ." It is settled that whether the default order should be maintained under the circumstances attending a particular case, or whether it should be set aside, is addressed to the sound discretion of the trial court. 4 Absent any grave abuse, this Court will not interfere in the exercise of that discretion by the trial court. As a matter of fact, every presumption is in favor of the correctness of its action. 5 While Sec. 3 of Rule 18 is explicit that the reglementary period for filing the motion to lift the order of default is at any time after discovery and before judgment, it is to the party's advantage that such motion is filed promptly and without unnecessary delay 6 because this is a factor taken into account in granting the prayer. In this regard, petitioner asserts that there was inordinate delay on the part of private respondent in filing her motion. Be that as it may, the records disclose that almost all of the "ill-gotten wealth" cases against private respondent and her family have not even reached the pre-trial stage such that no real injury against the interest of the State will result with the lifting of the default order. Besides, as will hereafter be shown, the peculiar circumstances of the present case justify the questioned resolutions of public respondent. We agree with the ruling of the Sandiganbayan that the failure of private respondent to properly respond to the various complaints pending before it was due to fraud, accident and excusable neglect. At the time the complaints were instituted against private respondent, circumstances occurred which ordinary prudence could not have guarded against and by reason of which her rights were impaired. Thus, private respondent and her family were effectively barred by the government from returning to the Philippines. She was likewise burdened with numerous civil and criminal suits in the United States for alleged violation of the so-called RICO Act. Moreover, the deteriorating health of her husband aggravated the problems confronting her. Corollarily, the complexities of her

legal battles necessitated extensive preparation but which she could not undertake as she was barred from coming back to the country. The claim of petitioner that she ran for the presidency for the purpose of rendering academic the cases against her in the event she succeeded is conjectural and speculative and deserves scant consideration.

Third. Equally important as the evidence on fraud, accident and excusable neglect is that private respondent has shown, prima facie at least according to public respondent, that she has meritorious
defenses the tenability of which remains to be ascertained during the trial. The proffered defenses are: (a) She neither took advantage nor abused her late husband's position to acquire funds and other assets for her own personal benefit and aggrandizement; (b) Subject funds and assets were legally acquired by her and her husband using legitimately-sourced private funds; (c) Subject transactions were all entered at arm's length and did not, under any circumstances, cause prejudice nor damage to petitioner and the Filipino people; and, (d) Subject funds and assets were merely entrusted to the individuals and/or corporations concerned.

Fourth. Aside from the foregoing considerations, the most elementary sense of fairness and

liberality appears to have prompted the Sandiganbayan to lift the order of default. Significantly, it is the avowed policy of the law to accord both parties every opportunity to pursue and defend their cases in the open and relegate technicality to the background in the interest of substantial justice. After all, petitioner had applied, on several occasions, for leave to file amended or expanded complaints which applications were invariably granted, notwithstanding the resulting delay. Perhaps, it is now the turn of private respondent to be the recipient of and enjoy the same procedural liberality if not compassion. WHEREFORE, there being no grave abuse of discretion committed by public respondent Sandiganbayan (Second Division) in the issuance of the assailed resolution of 28 October 1992 lifting the order of default, as well as the resolution of 6 January 1993 denying the reconsideration thereof, the instant petition is DISMISSED. SO ORDERED.

PEDRO CALANO, petitioner-appellant, vs. PEDRO CRUZ, respondent-appellee.

J. R. Nuguid for appellant. Emilio A. Gangcayco for appellee.

MONTEMAYOR, J.: For purposes of the present appeal the following facts, not disputed, may be briefly stated. As a result of the 1951 elections respondent Pedro Cruz was proclaimed a councilor-elect in the municipality of Orion, Bataan, by the Municipal Board of Canvasser. Petitioner Pedro Calano filed a complaint or petition for quo warranto under section 173 of the Revised election code (Republic Act

No. 180), contesting the right of Cruz to the office on the ground that Cruz was not eligible for the office of municipal councilor. In his prayer petitioner besides asking for other remedies which in law and equity he is entitled to, asked that after declaring null and void the proclamation made by the Municipal Board of Canvasser in November, 1951, to the effect that Cruz was councilor-elect, he (Calano) be declared the councilor elected in respondent's place. Acting upon a motion to dismiss the petition, the Court of First Instance of Bataan issued the order of December 27, 1951, dismissing the petition for quo warranto on the ground that it was filed out of time, and also because petitioner had no legal capacity to sue as contended by respondent. On appeal to this Court by petitioner from the order of dismissal, in a decision promulgated on may 7, 1952, we held that the petition was filed within the period prescribed by law; and that although the petition might be regarded as somewhat defective for failure to state a sufficient cause of action, said question was not raised in the motion to dismiss because the ground relied upon, namely, that petitioner had no legal capacity to sue, did not refer to the failure to state a sufficient cause of action but rather to minority, insanity, coverture, lack of juridical personality, or nay other disqualification of a party. As a result, the order of dismissal was reversed and the case was remanded to the court of origin for further proceedings. Upon the return of the case to the trial court, respondent again moved for dismissal on the ground that the petition failed to state a sufficient cause of action, presumably relying upon the observation made by us in our decision. Further elaborating on our observation that the petition did not state a sufficient cause of action, we said that paragraphs 3 and 8 of the petition which reads thus 8. Que el recurrente tenia y tiene derecho a ocupar el cargo de concejal de Orion, Bataan, si no habia sido proclamado electo concejal de Orion, Bataan, al aqui recurrido. 3. Que el recurrente era candidato a concejal del municipio de Orion, Bataan con el certificado de candidatura dedidamente presentado, y registrado asi como tambien fue votado y elegido para dicho cargo, en la eleccion del 13 de noviembre de 1951. (Emphasis supplied) were conclusions of law and not statement of facts. The trial court sustained the second motion to dismiss in its order of September 30, 1952, on the ground that the petition failed to state a sufficient cause of action. Again petitioner has appealed from that order to this court. Appellant urges that the trial court erred not only in not holding that the motion to dismiss was filed out of time but also in declaring that the complaint failed to state a sufficient cause of action. In answer respondent-appellee contends that the appeal should not have been given due course by the trial court because under the law there is no appeal from a decision of a court of First Instance in protests against the eligibility or election of a municipal councilor, the appeal being limited to election contests involving the offices of Provincial governor, Members of the Provincial Board, City Councilors and City Mayors, this under section 178 of the Revised Election Code.

In the past we had occasion to rule upon a similar point of law. In the case of Marquez vs. Prodigalidad, 46 Off. Gaz., Supp. No. 11, p. 204, we held that section 178 of the Revised election code limiting appeals from decisions of Courts of First Instance in election contests over the offices of Provincial Governor, members of the Provincial Board, City Councilors and City Mayors, did not intend to prohibit or prevent the appeal to the Supreme Court in protests involving purely questions of law, that is to say, that protests involving other officers such as municipal councilor may be appealed provided that only legal questions are involved in the appeal. Consequently, the appeal in the present case involving as it does purely questions of law is proper. Going to the question of sufficiency of cause of action, it should be stated that our observation when the case came up for the first time on appeal was neither meant nor intended as a rule or doctrine. We were merely considering the main prayer contained in appellant's petition, namely, that he be declared councilor-elect in the place of the respondent-appellee. In other words, we only observed that petitioner could not properly ask for his proclamation as councilor-elect without alleging and stating not mere conclusions of law but facts showing that he had the right and was entitled to the granting of his main prayer. Considering the subject of cause of action in its entirety, it will be noticed that section 173 of the Revised Election Code provides that when a person who is not eligible is elected, any registered candidate for the same office like the petitioner-appellant in this case, may contest his right to the office by filing a petition for quo warranto. To legalize the contest this section just mentioned does not require that the contestant prove that he is entitled to the office. In the case Llamoso vs. Ferrer, 47 Off. Gaz., No. 2, p. 727, wherein petitioner Llamoso who claimed to have received the next highest number of votes for the post of Mayor, contested the right of respondent Ferrer to the office for which he was proclaimed elected, on the ground of ineligibility, we held that section 173 of the Revised election Code while providing that any registered candidate may contest the right of one elected to any provincial or municipal office on the ground of ineligibility, it does not provide that if the contestee is later declared ineligible, the contestant will be proclaimed elected. In other words, in that case, we practically declared that under section 173, any registered candidate may file a petition for quo warranto on the ground of ineligibility, and that would constitute a sufficient cause of action. It is not necessary for the contestant to claim that if the contestee is declared ineligible, he (contestant) be declared entitled to the office. As a matter of fact, in case of Llamoso vs. Ferrer, we declared the office vacant. In view of the foregoing, the failure of Calano to allege that he is entitled to the office of councilor now occupied by the respondent Cruz does not effect the sufficiency of his cause of action. Reversing the order of dismissal, the case is hereby remanded to the trial court for further proceedings. No costs.

Paras, C.J., Pablo, Bengzon, Padilla, Reyes, Jugo, Bautista Angelo and Labrador, JJ., concur.

Ang Tibay v CIR (1940) 69 Phil 635 J. Laurel

Facts: Toribio claimed to have laid off workers due to the shortage of leather soles in the Ang Tibay factory. The Court of industrial relations forwarded a motion for recon with the supreme court. In pursuit of a retrial in the Court of Industrial Relations, the national labor union, the respondent, averred: 1. The shortage of soles has no factual basis 2. The scheme was to prevent the forfeiture of his bond to cover the breach of obligation with the Army 3. The letter he sent to the army was part of this scheme 4. The company union was an employer dominated one. 5. laborers rights to CBA is indispensable. 6. Civil code shouldnt be used to interpret a legislation of American industrial origins. 7. Toribio was guilty of unfair labor practice for favoring his union. 8. Exhibits are inaccessible to respondents. 9. The exhibits can reverse the judgment. Issue: Is the Court of Industrial Relations the proper venue for the trial? Held: Yes. Case remanded to the CIR Ratio: There was no substantial evidence that the exclusion of the 89 laborers here was due to their union affiliation or activity. The nature of the CIR is that of an administrative court with judicial and quasi-judicial functions for the purpose of settling disputes and relations between employers and employees. It can appeal to voluntary arbitration for dispute. It can also examine the industries in a locality by order of the president. There is a mingling of executive and judicial functions, which constitutes a departure from the separation of powers. The Court of Industrial Relations is not narrowly constrained by technical rules of procedure, and is not bound by technical rules of legal procedure. It may also include any matter necessary for solving the dispute. The fact, however, that the Court of Industrial Relations may be said to be free from the rigidity of certain procedural requirements does not mean that it can, in justifiable cases before it, entirely ignore or disregard the fundamental and essential requirements of due process in trials and investigations of an administrative character. Some examples that it must follow are: 1. right to a hearing 2. consideration of evidence by the court 3. duty to deliberate implies a necessity which cannot be disregarded, namely, that of having something to support it is a nullity, a place when directly attached 4. substance of evidence and the non-binding aspect of judicial decisions in an admin court so as to free them from technical rules

5. the decision must be rendered at the evidence presented at the hearing. The court may also delegate some powers to other judicial bodies. 6. The court must act on its own decision at reaching a controversy. It mustnt merely accept the views of a subordinate. 7. The court must clearly state the issues and the rationale for the decision. The record is barren and doesnt satisfy a factual basis as to predicate a conclusion of law. Evidence was still inaccessible. The motion for a new trial should be granted and sent to the CIR.

Zambales Chromite Mining et al vs Court of Appeals on November 25, 2010 ZCM filed an administrative case before the Director of Mines Gozon to have them be declared the rightful and prior locators and possessors of 69 mining claims in Sta. Cruz, Zambales. They are asserting their claim against the group of Martinez and Pabiloa. Gozon decided in favor of Martinez et al. ZCM appealed the case before the Secretary of Agriculture and Natural Resources. During pendency, Gozon was assigned as the Sec of Agri. And Natural Resources. He did not inhibit himself from deciding on the appeal but he instead affirmed his earlier decision when he was still the director of mines. ZCM then appealed before the CFI of Zambales. The CFI affirmed the decision of Gozon. It held that the disqualification of a judge to review his own decision or ruling (Sec. 1, Rule 137, Rules of Court) does not apply to administrative bodies; that there is no provision in the Mining Law, disqualifying the Secretary of Agriculture and Natural Resources from deciding an appeal from a case which he had decided as Director of Mines; that delicadeza is not a ground for disqualification; that the ZCM did not seasonably seek to disqualify Gozon from deciding their appeal, and that there was no evidence that Gozon acted arbitrarily and with bias, prejudice, animosity orhostility to ZCM. ZCM appealed the case to the CA. The CA reversed Gozons finding and declared that ZCM had the rights earlier attributed to Martinez et al by Gozon. Martinez et al appealed averring that the factual basis found by Gozon as Director of Mines be given due weight. The CA reconsidered after realizing that Gozon cannot affirm his own decision and the CA remanded the case to the Minister of Natural Resources. Now both parties appealed urging their own contentions; ZCM wants the CAs earlier deci sion to be reaffirmed while Martinez et al demanded that Gozons finding be reinstated. The CA denied both petition. ISSUE: Whether or not Gozon can validly affirm his earlier decision w/o disturbing due process. HELD: The SC annulled the decision of Gozon calling it as a mockery of justice. Gozon had acted with grave abuse of discretion. In order that the review of the decision of a subordinate officer might not turn out to be a farce, the reviewing officer must perforce be other than the officer whose decision is under review; otherwise, there could be no different view or there would be no real review of the case. The decision of the reviewing officer would be a biased view; inevitably, it would be the same view since being human, he would not admit that he was mistaken in his first view of the case. The SC affirmed the 2nd decision of the CA.

FELICIDAD ANZALDO, petitioner, vs. JACOBO C. CLAVE as Chairman of the Civil Service Commission and as Presidential Executive Assistant; JOSE A. R. MELO, as Commissioner of the Civil Service Commission, and EULALIA L. VENZON, respondents. This is a controversy over the position of Science Research Supervisor II, whose occupant heads the Medical Research Department in the Biological Research Center of the National Institute of Science and Technology (NIST). Doctor Felicidad Estores-Anzaldo 55, seeks to annul the decision of Presidential Executive Assistant Jacobo C. Clave dated March 20, 1980, revoking her appointment dated January 5,

1978 as Science Research Supervisor II and directing the appointment to that position of Doctor
Eulalia L. Venzon, 48. The contested position became vacant in 1974 when its incumbent, Doctor Quintin Kintanar, became Director of the Biological Research Center. Doctor Kintanar recommended that Doctor Venzon be appointed to that position. Doctor Anzaldo protested against that recommendation. The NIST Reorganization Committee found her protest to be valid and meritorious (p. 34, Rollo). Because of that impasse, which the NIST Commissioner did not resolve, the position was not filled up. At the time the vacancy occurred, or on June 30, 1974, both Doctors Anzaldo and Venzon were holding similar positions in the Medical Research Department: that of Scientist Research Associate IV with an annual compensation of P12,013 per annum. Both were next-in-rank to the vacant position. Later, Doctor Pedro G. Afable, Vice-Chairman, became the Officer-in-Charge of the NIST. Effective January 5, 1978, he appointed Doctor Anzaldo to the contested position with compensation at P18,384 per annum. The appointment was approved by the Civil Service Commission. Doctor Afable, in his letter dated January 20, 1978, explained that the appointment was made after a thorough study and screening of the qualifications of Doctors Anzaldo and Venzon and upon

the recommendation of the NIST Staff Evaluation Committee that gave 88 points to Doctor Anzaldo and 61 points to Doctor Venzon (p. 78, Rollo).
Doctor Venzon in a letter dated January 23, 1978, addressed to Jacobo C. Clave, appealed to the Office of the President of the Philippines (pp. 139-40). The appeal was forwarded to the NIST Anzaldo to the contested position (p. 63, Rollo). The appeal-protest was later sent to the Civil Service Commission. Chairman Clave of the Civil Service Commission and Commissioner Jose A. R. Melo recommended in Resolution No. 1178 dated August 23, 1979 that Doctor Venzon be appointed to the contested position, a recommendation which is in conflict with the 1978appointment of Doctor Anzaldo which was duly attested and approved by the Civil Service Commission (pp. 30 and 48, Rollo). The resolution was made pursuant to section 19(6) of the Civil Service Decree of the Philippines, Presidential Decree No. 807 (which took effect on October 6, 1975) and which provides that

before deciding a contested appointment, the Office of the President shall consult the Civil Service Commission. After the denial of her motion for the reconsideration of that resolution, or on January 5, 1980, Doctor Anzaldo appealed to the Office of the President of the Philippines. As stated earlier, Presidential Executive Assistant Clave (who was concurrently Chairman of the Civil Service Commission) in his decision of March 20, 1980 revoked Doctor Anzaldos appointment and ruled that, as recommended by the Civil Service Commission (meaning Chairman Clave himself and Commissioner Melo), Doctor Venzon should be appointed to the contested position but that Doctor Anzaldos appointment to the said position should be consider ed valid and effective during the pendency of Doctor Venzons protest (p. 36, Rollo). In a resolution dated August 14, 1980, Presidential Executive Assistant Clave denied Doctor Anzaldos motion for reconsideration. On August 25, 1980, she filed in this Court the instant special civil action of certiorari. What is manifestly anomalous and questionable about that decision of Presidential Executive

Assistant Clave is that it is an implementation of Resolution No. 1178 dated August 23, 1979 signed
by Jacobo C. Clave, as Chairman of the Civil ServiceCommission and concurred in by Commissioner Jose A. Melo. In that resolution, Commissioner Clave and Melo, acting for the Civil Service Commission, recommended that Doctor Venzon be appointed Science Research Supervisor II in place of Doctor Anzaldo. When Presidential Executive Assistant Clave said in his decision that he was inclined to concur in the recommendation of the Civil Service Commission, what he meant was that he was concurring with Chairman Claves recommendation: he was concurring with himself (p. 35, Rollo). It is evident that Doctor Anzaldo was denied due process of law when Presidential Executive

Assistant Clave

concurred

with

the

recommendation

of

Chairman

Clave

of

the Civil

Service Commission. The case is analogous to Zambales Chromite Mining Co. vs. Court of Appeals, L49711, November 7, 1979, 94 SCRA 261, where it was held that the decision of Secretary of Agriculture and Natural Resources Benjamin M. Gozon, affirming his own decision in a mining case as Director of Mines was void because it was rendered with grave abuse of discretion and was a mockery of administrative justice. Due process of law means fundamental fairness. It is not fair to Doctor Anzaldo that Presidential Executive Assistant Clave should decide whether his own recommendation as Chairman of the Civil Service Commission, as to who between Doctor Anzaldo and Doctor Venzon should be appointed Science Research Supervisor II, should be adopted by the President of the Philippines. Common sense and propriety dictate that the commissioner in the Civil Service Commission, who should be consulted by the Office of the President, should be a person different from the person

in the Office of the President who would decide the appeal of the protestant in a contested appointment. In this case, the person who acted for the Office of the President is the same person in the Civil

Service Commission who was consulted by the Office of the President: Jacobo C. Clave. The Civil
Service Decree could not have contemplated that absurd situation for, as held in the Zambales

Chromite case, that would not be fair to the appellant.

We hold that respondent Clave committed a grave abuse of discretion in deciding the appeal in favor of Doctor Venzon. The appointing authority, Doctor Afable, acted in accordance with law and properly exercised his discretion in appointing Doctor Anzaldo to the contested position. Doctor Anzaldo finished the pharmacy course in 1950 in the College of Pharmacy, University of the Philippines. She obtained from the Centro Escolar University the degree of Master of Science in Pharmacy in 1962 and in 1965 the degree of Doctor of Pharmacy. Aside from her civil service eligibility as a pharmacist, she is a registered medical technologist and supervisor (unassembled). She started working in the NIST in 1954 and has served in that agency for about twenty-eight (28) years now. As already stated, in January, 1978, she was appointed to the contested Position of Science Research Supervisor II. Her present salary as ScienceResearch Supervisor II, now known as Senior Science Research Specialist, is P 30,624 per annum after she was given a merit

increase by Doctor Kintanar, effective July 1, 1981 (p. 259, Rollo).

On the other hand, Doctor Venzon finished the medical course in the University of Santo Tomas in 1957. She started working in the NIST in 1960. She has been working in that agency for more than twenty-one (21) years. Doctor Anzaldo is senior to her in point of service. Considering that Doctor Anzaldo has competently and satisfactorily discharged the duties of the contested position for more than four (4) years now and that she is qualified for that position, her appointment should be upheld. Doctor Venzons protest should be dismi ssed. WHEREFORE, the decision of respondent Clave dated March 20, 1980 is set aside, and petitioner Anzaldos promotional appointment to the contested position is declared valid. No costs. SO ORDERED.

BETTER BUILDINGS, INC., WILLIAM WARNE and LEDA BEAVERFORD, petitioners, vs. THE NATIONAL LABOR RELATIONS COMMISSION, HALIN YSMAEL and ELISEO FELICIANO, respondents. D E C I S I O N ROMERO, J.:

This petition for certiorari with prayer for the issuance of a temporary restraining order and/or injunction seeks to annul the decision of public respondent National Labor Relations Commission (NLRC) dated March 3, 1989 [1] and resolution dated December 18, 1992, 2 directing petitioner Better Building, Inc. to reinstate private respondents Halim Ysmael and Eliseo Feliciano to their former positions without loss of seniority rights and benefits and to pay them backwages. Private respondent Halim Ysmael (Ysmael) was hired as a Sales Manager by petitioner Better Building, Inc. (BBI) on March 16, 1985. In addition to his monthly salary, he was given the free use of the company car, free gasoline and commission from sales. Private respondent Eliseo Feliciano (Feliciano), on the other hand, was employed as Chief Supervisor by the petitioner since January 1966. On May 3, 1988, petitioner, through its Assistant General Manager, Leda A. Beverford, showed to private respondents a memorandum regarding their termination from employment effective the same day, to wit: MEMO TO FROM DATE SUBJECT : Guard On Duty : : : The Asst. General Manager May 03, 1988 TERMINATION OF EMPLOYMENT OF MR. HALIM YSMAEL & MR. ELISEO FELICIANO -----------------------------------------------Please be advised that Mr. Halim Ysmael and Mr. Eliseo Feliciano have been terminated from their employment with our company as of the end of office hours today May 3, 1988. For the above reason they are not allowed to enter our premises. For your strict compliance. LEDA A. BEVERFORD Unable to accept petitioners drastic action, on May 6, 1988, private respondents filed a complaint against BBI for illegal dismissal.3 On March 3, 1989, Labor Arbiter Daisy G. Cauton-Barcelona rendered a decision, the dispositive portion of which reads: WHEREFORE, judgment is hereby ordered declaring that the complainants dismissal is illegal as discussed above hence, ordering the respondents to reinstate them to their former positions with full backwages and without loss of seniority and other benefits.

Ordering further to pay the complainants their salary differentials computed from November 1, 1986 up to the time of actual reinstatement. And, to pay complainant Halim Ysmael moral and exemplary damages in the amount of P100,000 and P50,000 respectively. With costs and attorneys fees against the respondents. SO ORDERED.4 Except for the reduction of the damages awarded by the Labor Arbiter, the said decision was affirmed by the NLRC,5 to wit: WHEREFORE, premises considered, the decision appealed from is hereby modified insofar as the awards of moral and exemplary damages are concerned which are reduced to P50,000 and P20,000 respectively. In all other respects, the decision of the Labor Arbiter below is affirmed. SO ORDERED. Petitioner, not satisfied with the decision, has filed the instant petition for certiorari alleging that the NLRC gravely abused its discretion amounting to lack or excess of jurisdiction when it rendered the decision of March 3, 1989 and the resolution of December 11, 1992. On September 4, 1996, this Court resolved to dismiss the case against private respondent Ysmael by virtue of the compromise agreement entered into between him and the petitioner.6 Hence, the resolution of this case will only affect private respondent Feliciano. Petitioner argues that the private respondent was validly dismissed for engaging in the same line of business as that of his employer (petitioner). Thus, his act of engaging in a business in direct competition with his employer was, not only an act of disloyalty, but more specifically a willful breach of trust and confidence. In termination of employment cases, we have consistently held that two requisites must concur to constitute a valid dismissal: (a) the dismissal must be for any of the causes expressed in Art. 282 of the Labor Code, and (b) the employee must be accorded due process, the elements of which are the opportunity to be heard and defend himself. 7 First, on the substantive aspect, petitioner contends that private respondent was dismissed from his employment for engaging in business in direct competition with its line of service. 8 Hence, said conduct constitutes a willful breach of trust which is justifiable cause for termination of employment.9 We sustain BBI. Deeply entrenched in our jurisprudence is the doctrine that an employer can terminate the services of an employee only for valid and just causes which must be supported by clear and

convincing evidence.10 The employer has the burden of proving that the dismissal was indeed for a valid and just cause.11 In the case at bar, petitioner has clearly established private respondents culpability by convincing evidence. First, it was never disputed that private respondent established another corporation, Reachout General Services, engaged in the maintenance/janitorial service, the same line of business as that of petitioner. In this regard, private respondent failed to adduce substantial evidence to disprove this allegation. Second, as Chief Supervisor of the petitioner, it was his duty to promote and offer the services of the petitioner to prospective clients; however, instead of so doing, private respondent offered the services of his own company to various clients, to the detriment of the petitioner. Notably, private respondent even had the temerity to induce two of BBIs prominent clients, namely the United States Embassy and San Miguel Corporation, to transfer their respective service contracts to Reachout General Services, his own corporation. Third, private respondents disloyalty became more conspicuous when he hired as the employees of Reachout General Services the former employees of the petitioner. Clearly, this act has undercut petitioners business. Finally, we cannot help but notice that in all the pleadings submitted by the private respondent, he never discussed nor refuted the charge against him by the petitioner. By his silence, we conclude that he was indeed guilty of disloyalty to his employer. In fact, the records are devoid of any evidence to controvert the evidence presented by the petitioner regarding his alleged disloyalty. Such omission only strengthens the petitioners claim. While we find that private respondent was dismissed for cause, the same was, however, effected without the requirements of due process. In this jurisdiction, we have consistently ruled that in terminating an employee, it is essential that the twin requirements of notice and hearing must be observed. 12 The written notice apprises the employee of the particular acts or omissions for which his dismissal is sought and at the same informs the employee concerned of the employers decision to dismiss him. In the case at bar, the record is bereft of any showing that private respondent was given notice of the charge against him. Nor was he ever given the opportunity under the circumstances to answer the charge; his termination was quick, swift and sudden. Interestingly, when this issue was brought up, all the petitioner could state in its Reply was: Even if there was a notice to explain and notice of termination given to the private respondents, the petitioner was already convinced at that time that the private respondents were already engaged in disloyal acts. The result would be the same dismissal.13 Evidently, the decision to dismiss respondent was merely based on the fact that petitioner was already convinced at the time that the private respondents were engaged in disloyal acts. As regards the procedural aspect, the failure to observe the twin requirements of notice and hearing taints the dismissal with illegality.

In fine, we find that there was basis for petitioners loss of trust and confidence in private respondent. For an employer cannot be compelled to retain in his service an employee who is guilty of acts inimical to its interest.14 A company has the right to dismiss its employees as a measure of protection.15 Corollarily, proof beyond reasonable doubt of an employees misconduct is not required in dismissing an employee on the ground of loss of trust and confidence. 16 The quantum of proof required, being only substantial evidence,17 we are convinced that there was an actual breach of trust committed by private respondent which was ample basis for petitioners loss of trust and confidence in him. We, therefore, hold that private respondents dismissal was for a just and val id cause. However, the manner of terminating his employment was done in complete disregard of the necessary procedural safeguards. A mans job being a property right duly protected by our laws, for depriving private respondent the right to defend himself, petitioner is liable for damages consistent with Article 32 of the Civil Code, which provides: ART. 32. Any public officer or employee, or any private individual, who directly or indirectly obstructs, defeats, violates or in any manner impedes or impairs any of the following rights and liberties of another person shall be liable to the latter for damages: xxx xxx xxx

(6) The right against deprivation of property without due process of law; xxx xxx x x x.

In this regard, the damages shall be in the form of nominal damages 18 for the award is not for the purpose of penalizing the petitioner but to vindicate or recognize private respondents right to procedural due process which was violated by the petitioner. WHEREFORE, in view of the foregoing, the assailed decision of the NLRC and its accompanying resolution are hereby SET ASIDE andANNULLED. However, for failure to observe procedural due process in effecting the dismissal, petitioner shall pay to the private respondentP5,000.00 as nominal damages. No costs. SO ORDERED.

ANTONIO CARAG VS NLRC ET. AL. G.R NO. 147590, APRIL 2, 2007 FACTS: National Federation of Labor Unions (NAFLU) and Mariveles Apparel Corporation Labor Union (MACLU), on behalf of all of MACs rank and file employees, filed a complaint against MAC for illegal dismissal brought about by its illegal closure of business. They included in their complaint Mariveles Apparel Corporations Chairman of the Board Antonio Carag in order to be solidarily liable for the illegal dismissal and illegal closure of business. According to the Labor Union of MAC, the

Corporation suddenly closed its business without following the notice as laid down in the Labor Law of the Philippines. The Labor Arbiter decided in favor of the Labor Union and held that Antonio Carag being the owner of the corporation be solidarily liable for the payment of separation pay and backwages of the rank and file employees. Antonio Carag questioned the decision of the Labor Arbiter and alleged that the Corporation and its officers have separate and distinct personality and the latter cannot be held liable solidarily in cases of payment of damages.

Issue: Whether or not Antonio Carag be held solidarily liable for the payment of the illegally dismissed employees.

Held: The Supreme Court held that the rule is that a director is not personally liable for the debts of the corporation, which has a separate legal personality of its own. Section 31 of the Corporation Code lays down the exceptions to the rule, as follows:

Liability of directors, trustees or officers. - Directors or trustees

who wilfully and knowingly vote for or assent to patently unlawful acts of the corporation or who are guilty of gross negligence or bad faith in directing the affairs of the corporation or acquire any personal or pecuniary interest in conflict with their duty as such directors or trustees shall be liable jointly and severally for all damages resulting therefrom suffered by the corporation, its stockholders or members and other persons.

x xxx

Section 31 makes a director personally liable for corporate debts if he wilfully and knowingly votes for or assents to patently unlawful acts of the corporation . Section 31 also makes a director personally liable if he is guilty of gross negligence or bad faith in directing the affairs of the corporation.

Complainants did not allege in their complaint that Carag wilfully and knowingly voted for or assented to any patently unlawful act of MAC. Complainants did not present any evidence showing that Carag wilfully and knowingly voted for or assented to any patently unlawful act of MAC. Neither did Arbiter Ortiguerra make any finding to this effect in her Decision.

For a wrongdoing to make a director personally liable for debts of the corporation, the wrongdoing approved or assented to by the director must be a patently unlawful act. Mere failure to comply with the notice requirement of labor laws on company closure or dismissal of employees does not amount to a patently unlawful act. Patently unlawful acts are those declared unlawful by law which imposes penalties for commission of such unlawful acts. There must be a law declaring the act unlawful and penalizing the act.

Wherefore, Antonio Carag is not liable to the debt of the Corporation as to the illegally dismissed employees of MAC.