RAMON P. ARON, petitioner, vs.

FRANCISCO REALON, DOMINGO REALON and FELIPE REALON, representing the HEIRS OF MARCIANO REALON and ROMAN REALON, EMILIANO R. PURIFICACION, representing the HEIRS OF ALFREDO REALON and ROMAN REALON,respondents.

That furthermore, we bind ourselves to pay the tenant working on the land the amount of P47,593.48 upon our receipt of the amount of the balance of P142,080.48, which payment is to be taken from said balance; Finally, we bind ourselves to execute the Final Deed of Sale on or before May 23, 1980, or whenever we will be able to bring under the operations of the Torrens System of registration the portion of land with an area of 62,316 sq. meters, subject of this contract and upon our receipt of the said balance of P142,080.48. 12 On July 31, 1979, Alfredo also executed a Contract to Sell 13 over his undivided share in Lot No. 1253 in favor of the petitioner, for and in consideration of P253,196.00. The latter made a partial payment of P60,935.04 upon the execution of the contract. Alfredo obliged himself to execute a final deed of sale over the property upon the petitioner's payment of the balance of the purchase price on or before May 23, 1980, or as soon as the vendor shall have secured the OCT over the property. 14 However, the vendors failed to file a petition for the registration of the property under the Torrens System. Consequently, the petitioner, as vendee, refused to pay the balance of the purchase price. cHTCaI On November 11, 1983, the petitioner himself filed an application 15 for the registration of Lot No. 1253 under his name. He alleged therein that he was the owner of the property based on a deed of sale executed by Alfredo and his nephews; the property was unoccupied; and to the best of his knowledge and belief, there was never a mortgage or encumbrance of any kind, affecting the said property, or any person having an interest therein, legal or equitable or in possession thereof. The petitioner appended to his application a copy 16 of the July 31, 1979 Contract to Sell executed in his favor by Alfredo and his nephews. The case was docketed as LRC Case No. 83-15. Notice of initial hearing of the case was issued to all concerned parties which included Alfredo and his nephews, who were the vendors. 17 On January 8, 1985, Marciano, and in behalf of his brothers, executed a Deed of Sale with Mortgage 18 in favor of the petitioner over their undivided shares in Lot No. 1253, this time, for the price of P186,948.00, payable as follows: a.The sum of NINETY-ONE THOUSAND SEVEN HUNDRED SEVENTEEN and FORTY-FOUR (P91,717.44) PESOS inclusive of the earnest money and part payment which was paid before hand and upon the signing of this documents and receipt of which is hereby acknowledged by the VENDORS-MORTGAGEES. b.The sum of NINETY-FIVE THOUSAND TWO HUNDRED THIRTY and FIFTY-SIX PESOS (P95,230.56) balance upon issuance of title to VENDEE-MORTGAGOR. To secure the payment of the balance of the purchase price of the property, the petitioner mortgaged the property to the vendor, thus: 5.That to secure the full and complete payment of the sum of NINETY-FIVE THOUSAND TWO HUNDRED THIRTY and FIFTY-SIX PESOS (P95,230.56) in manner herein mentioned, the VENDEE-MORTGAGOR hereby CEDES, TRANSFERS and CONVEYS by way of first mortgage in favor of the VENDORS-MORTGAGEES the pro-indiviso interests herein sold. On even date, Alfredo executed a similar Deed of Sale with Mortgage 19 in favor of the petitioner over his undivided share of 84,632 square meters over Lot No. 1253 in consideration of P253,196.00, payable as follows:

DECISION

CALLEJO, SR., J p: Before us is a petition for review on certiorari of the Decision 1 of the Court of Appeals 2 (CA) in CA-G.R. CV No. 68979 which affirmed the Decision 3 of the Regional Trial Court (RTC) of Bacoor, Cavite, Branch 89, in Civil Case No. BCV 96-29. The antecedents are as follows: Roman Realon was the owner of two (2) parcels of land, one of which was Lot No. 1253 4 of the Carmona Cadastre with 146,948 square meters, more or less, located in Barrio Lantik, Carmona, Cavite, and covered by Tax Declaration No. 621. The other parcel of land, Lot No. 602, 5 of the Carmona Cadastre, with an area of 3,105 square meters, is located in Barrio Maduya, in the same town. When he died intestate on April 4, 1946, Roman was survived by his son Alfredo and the children of his deceased son, Buenaventura, namely, Marciano, Joaquino, Florentino, Felipe, Marcelo, Sesinando, and Montano. 6 Emiliano Realon Purificacion, Alfredo's grandson had worked on the property as a tenant since 1970 and planted palay, pineapple, bananas and other fruit crops. 7 On May 14, 1979, Alfredo, together with his nephews Marciano, Joaquino, Florentino, Felipe, Marcelo, Sesinando, and Montano, executed an Extrajudicial Settlement entitled "Manahan Sa Labas ng Hukuman" 8 wherein they adjudicated Lot No. 602 in its entirety to Alfredo, and that Lot No. 1253 was to be divided and adjudicated as follows: 84,632 square meters to Alfredo; and the remaining 62,316 square meters to Marciano, Joaquino, Florentino, Felipe, Marcelo, Sesinando, and Montano. cEaSHC On the same day, May 14, 1979, Felipe, Sesinando, Montano, Marcelo, Florentino and Joaquino, constituted their brother Marciano Realon as their attorney-in-fact in selling their pro-indiviso shares in Lot No. 1253. 9 Thus, on July 31, 1979, Marciano, in his behalf and in behalf of his brothers, executed a Contract to Sell 10 covering Lot No. 1253 in favor of the petitioner for the price of P186,948.00 payable as follows: P44,867.52 upon the execution of the deed; and P142,080.48 on or before May 23, 1980, or as soon as the vendees shall have secured an original certificate of title (OCT) over the property under their names. The vendors obliged themselves to execute a final deed of sale upon full payment of the purchase price of the property 11 and to pay the tenant working on the land, Emiliano, the amount of P47,593.48 upon receipt of P142,080.48 from the petitioner, to wit: That I and the other persons and whose behalf I have executed this instrument further bind ourselves to execute the final Deed of Sale upon receipt of the balance of ONE HUNDRED FORTY-TWO THOUSAND [PESOS] (P142,000.00) to complete the amount of the consideration or selling price for the 62,316 square meters which is agreed to be P186,948.00;

a.The sum of ONE HUNDRED TWENTY-FOUR THOUSAND FIVE HUNDRED FORTY-SIX AND SEVENTY-SEVEN (P124,546.77) PESOS inclusive of the earnest money and part payment which was paid before hand and upon the signing of this document and receipt of which is hereby acknowledged by the VENDOR-MORTGAGEE. ESTaHC b.The sum of ONE HUNDRED TWENTY-NINE THOUSAND THREE HUNDRED FORTY-NINE AND SEVENTY THREE (P129,349.73) PESOS balance upon issuance of title of VENDEEMORTGAGOR. To secure the payment of the balance of the purchase price, the petitioner likewise mortgaged the property to the vendor. 5.That to secure the full and complete payment of the sum of ONE HUNDRED TWENTY-NINE THOUSAND THREE HUNDRED FORTY-NINE AND SEVENTY THREE (P129,349.73) PESOS in the manner hereinafter mentioned, the VENDEE-MORTGAGOR hereby cedes, transfers and coveys by way of first mortgage in favor of the VENDOR-MORTGAGEE the proindiviso interest herein sold. The petitioner adduced in evidence the Contracts to Sell executed by Alfredo and his nephews in 1979 20 in LRC Case No. 83-15. Alfredo and Marciano testified for the petitioner. 21 On January 24, 1985, the RTC rendered judgment in favor of the applicant, with the following dispositive portion: WHEREFORE, finding the application to be well-taken, applicants having presented the required quantum of evidence to prove possession; this Court confirms applicant Ramon P. Aron's title to the parcel of land covered by Plan Ap-04-003288 (Exhibit "F") and described in its technical description (Exhibit "J") with his above-described personal circumstances, subject to the remaining balance of P129,349.73. Once this decision becomes final, let the corresponding decree of registration issue. SO ORDERED. 22 The decision became final and executory. On March 12, 1985, the court ordered the issuance of a decree. 23 In the meantime, Alfredo died in 1989, while Marciano died intestate on June 22, 1990. 24 On September 9, 1993, the Register of Deeds issued under the petitioner's name OCT No. O-2348 covering Lot No. 1253. Annotated therein was the following: "subject to such encumbrances mentioned in Section 44 of said Decree as may be subsisting, and subject to the remaining balance of P129,349.73." Sometime in August 1994, the petitioner, through his attorney-in-fact 25 Engr. Aldersen Ilaban, filed an amended complaint 26 for consignation against the heirs of Alfredo, namely, Ruperta Mapanso, Florentino Purificacion, Emiliano Purificacion, Serafin Purificacion and Leonedes Purificacion; the heirs of Marciano Realon, namely, Domingo Realon and Francisco Realon; and the heirs of Marcelo Realon, namely, Ma. Luz R. Librado, Santiago Realon, Isidro R. Manabo, Rufina B. Mercado and Romel Realon, with the RTC of Imus, Cavite. 27 The complaint was docketed as Civil Case No. BCV 94-28. TEAICc The petitioner alleged, inter alia, that pursuant to the two (2) deeds of sale with mortgage, he had already paid Alfredo the total sum of P217,046.77, and to Marciano and his siblings, the sum of P180,948.00; having paid a total of P397,994.77, his total balance of the purchase price of the property was only P42,849.23; he learned about the death of Alfredo and Marciano in 1993 when some persons claiming to be their heirs wanted to collect the money from him, but none of them could present any authority to collect for and in behalf of the heirs of the vendors. The complaint contained the following prayer:

WHEREFORE, it is prayed that upon filing of this complaint, an order be issued allowing plaintiff to deposit the sum of P42,849.23 before this Court representing the balance due under both Deeds of Sale with Mortgage, and that after notice and due consideration, judgment be rendered, as follows: 1.Declaring plaintiff's obligation under the Deed of Sale discharged and/or released pursuant to the first paragraph of Article 1260 of the Civil Code; 2.Ordering defendants to pay, jointly and severally, the sum of P15,000.00, as attorney's fees and further sum of P1,000.00 as appearance fee per court attendance, the cost of consignation or litigation cost pursuant to Article 1259 of the New Civil Code. 3.Other reliefs and remedies just and equitable in the premises are likewise prayed. 28 The petitioner then deposited the amount of P42,849.23 with the Clerk of Court of the RTC. He adduced in evidence the Deed of Sale 29 with Mortgage dated January 8, 1985 executed by Alfredo and his nephews. In their answer 30 to the complaint, the defendants therein alleged that their predecessors-in-interest did not sell the property to the petitioner. On November 27, 1995, the trial court rendered its decision 31 in Civil Case No. BCV 94-28. It declared the consignation to be valid and released the petitioner from his obligation under the Deed of Sale with Mortgage. 32 The said decision became final and executory. On March 18, 1996, Francisco Realon, Domingo Realon and Felipe Realon, allegedly representing the heirs of Marciano and Roman Realon, together with Emiliano R. Purificacion, allegedly representing also the heirs of Alfredo and Roman Realon, filed a complaint for reconveyance and ownership against the petitioner with the RTC of Bacoor, Cavite. The case was docketed as Civil Case No. BCV 96-29. 33 The plaintiffs alleged, inter alia, that they were representing the heirs of Marciano, Alfredo and Roman Realon; under the contracts to sell executed by their predecessors to the petitioner over Lot No. 1253, the latter still had a balance of P379,908.96; contrary to the terms of the contracts to sell, the petitioner filed an application for the registration of the title over the land in his name where he falsely claimed that he was the owner of the property, free of all liens and encumbrances or claim of any person whatsoever; worse, the defendant induced Marcelo and his uncle, Alfredo, who were illiterates, to execute separate deeds of sale with real estate mortgage in his favor over the property on the promise that the title to the property will be under the names of all the vendors or their heirs as enumerated in the said deeds; the said deeds of sale with mortgage were not registered in the Office of the Register of Deeds; they learned of the existence of OCT No. 0-2348 in the name of the petitioner, through the RTC's decision in the consignation case; the petitioner had never been in possession of the subject property; realty taxes of the subject property were still being paid in the name of Roman Realon despite the issuance of the said title in the name of the petitioner; and the plans over the property had been approved under the name of Roman Realon. IEAacS The plaintiffs prayed that after notice and hearing, judgment be rendered in their favor: WHEREFORE, it is most respectfully prayed that, after notice and hearing the Honorable Court render judgment in favor of the plaintiffs and against the defendants, as follows:

1).Declaring that the ownership of the land described in OCT No. O-2348 belongs to the heirs of the late Roman Realon represented by the plaintiffs; 2).Ordering the defendants to surrender OCT No. O-2348 to effect the cancellation and transfer thereof to herein plaintiffs, by way of reconveyance of ownership; 3).Ordering and authorizing the Register of Deeds for the Province of Cavite to cancel said OCT No. O-2348, and to issue a new Certificate of Title in the name of herein plaintiffs, in case of failure of the defendants to surrender to plaintiffs OCT No. O-2348; 4).Ordering the cancellation of the annotation on OCT No. O-2348 reading and stated "and to the remaining balance of P129,349.73" and that the new Certificate of Title be free and clear from such encumbrance; and, 5).Ordering defendants to pay to plaintiffs attorneys' fees in the amount of P50,000.00, appearance and costs of suit. Plaintiffs pray for such further reliefs just and equitable in the premises. 34 In his answer to the complaint, the petitioner alleged, among others, that the contracts to sell had been superseded and modified by the two (2) subsequent deeds of sale with mortgage executed in his favor on January 8, 1985, in that the purchase price agreed upon had almost been paid except for the balance of P42,849.23, which he consigned with the court in Civil Case No. BCV 94-28. He also denied making false pretenses in his application for registration of title, and interposed the following special and affirmative defenses: 14.That plaintiff has no cause of action against defendant absent any showing that plaintiffs are authorized to sue in a representative capacity, there being no testate nor intestate proceedings for the estate of the deceased whom they represent; CAIHTE 15.That the property embraced by OCT 2348 were (sic) alienated during the lifetime of Alfredo and Marciano Realon, consequently, the rights of the plaintiffs or the heirs they represent have been lost by such alienation; 15.1Plaintiffs have, in fact, no right to sue under the contracts executed by the deceased Alfredo and Marciano Realon during their lifetime. And should they have, the same has already prescribed; 16.That the registration proceedings filed by defendant Aron being a proceeding in rem, binds the whole world so that the decree of registration and issuance of original certificate of title may not be invalidated or vitiated by any claim or interest of any person. 17.That defendant had already paid the agreed purchase price including the balance through consignation (BCV No. 94-28); . . . 35 Emiliano R. Purificacion testified that he was the great grandson of Roman Realon, being the son of Beatriz Realon, a daughter of Alfredo Realon and Celestina Purificacion. 36 He and the other heirs inherited the property and had been paying the realty taxes therefore. 37 He also testified that he had been a tenant on the property since 1970. He claimed that he had not received any payment of the balance of the purchase price as stipulated in the contracts

to sell 38 in favor of the petitioner. He claimed that the contracts to sell executed by Alfredo and Marciano, in favor of the petitioner, had been cancelled since his cousin Francisco Realon had written a letter to the petitioner to that effect. 39 Francisco Realon testified that being the son of Marciano, he was the great grandson of Roman Realon. 40 He pointed out that all the tax declarations of the subject property were in the name of Roman and that the corresponding taxes were duly paid. 41 He, likewise, claimed to have prepared a letter before Christmas of 1980, canceling the contracts to sell executed and duly signed by Alfredo and Marciano. However, he could not present any copy of the letter as he did not retain any copy thereof. 42 For his part, Felipe Realon declared that he was one of the heirs of Roman Realon and that he executed a special power of attorney in favor of his brother, Marciano, to deal with their inheritance. 43 He stressed that the special power of attorney had never been revoked during the lifetime of Marciano. 44 The petitioner no longer testified and rested his case after the admission of his documentary evidence. On August 13, 1999, the trial court rendered its decision 45 in favor of the plaintiffs. The decretal portion reads: ACCORDINGLY, judgment is hereby rendered in favor of the plaintiffs and against the defendant, to wit: 1.Declaring that the ownership of the land described in Original Certificate of Title No. 0-2348 belongs to the plaintiffs; 2.Ordering the defendant to surrender Original Certificate of Title No. 0-2348 to the plaintiffs to effect its cancellation and transfer it in favor of the latter by way of reconveyance. 3.Ordering the Register of Deeds for the Province of Cavite to cancel Original Certificate of Title No. 0-2348 and issue a new one in favor of the plaintiffs; 4.Ordering the plaintiffs to reimburse the defendant the sum of P310,794.27, plus legal interest, to be computed from the time it was received by plaintiffs' predecessor-ininterest; CaDEAT 5.Ordering the defendant to pay plaintiffs attorneys' fees in the amount of P50,000.00 plus appearance fees of P1,000.00 per appearance, plus costs of suit. SO ORDERED. 46 The trial court held that the petitioner falsely alleged in his application in LRC Case No. 83-15 that he was the owner of the property based on a deed of sale, when in fact under the contracts to sell executed by Alfredo and his nephews, he would acquire title over the property only upon payment of the full purchase price thereof and by the vendors' execution of a final deed of sale over the property. The trial court ruled that the petitioner had no right to file the application in LRC Case No. 83-15. It held that the plaintiffs continued to be in the possession of the property and paid realty taxes therein under the name of Roman Realon, the original owner of the property. The petitioner appealed the decision and assigned the following error, to wit:

THE TRIAL COURT ERRED IN HOLDING THAT THE ALLEGED FRAUD IN THE APPLICATION FOR THE REGISTRATION OF THE LAND IS THE KIND OF FRAUD CONTEMPLATED BY LAW TO WARRANT RECONVEYANCE OF THE SUBJECT PROPERTY. 47 On November 26, 2002, the CA rendered judgment dismissing the appeal. 48 The appellate court agreed with the trial court that the petitioner employed fraud when he filed his application in LRC Case No. 83-15, and falsely alleged that he was the owner of the property subject thereof.

ground that the plaintiff has no capacity to sue under Section 1(d) of Rule 16 of the Rules of Court, that is, that he does not have the representative he claims. 54 Section 7, Rule 3 of the Rules of Court reads: SEC. 7.Compulsory joinder of indispensable parties. Parties in interest without whom no final determination can be had of an action shall be joined either as plaintiffs or defendants. CIcTAE Thus, the presence of all indispensable parties is a condition sine qua non for the exercise of judicial power. It is precisely when an indispensable party is not before the court that the action should be dismissed. The plaintiff is mandated to implead all indispensable parties, and the absence of one renders all subsequent actions of the court null and void for want of authority to act, not only as to the absent parties, but even as to those present. 55 One who is a party to a case is not bound by any decision of the court; otherwise, he will be deprived of his right to due process. The records show that when Roman Realon died intestate on April 4, 1946, he was survived by his son, Alfredo, and his nephews, who were the children of his deceased son, Buenaventura, namely, Marciano, Joaquino, Florentino, Felipe, Marcelo, Sesinando and Montano, all surnamed Realon. On the other hand, when Alfredo died intestate, he was survived by his heirs, Ruperta Mapanso, Florentino Purificacion, Emiliano Purificacion, the son of his deceased daughter, Beatriz Realon, Serafin Purificacion and Leonedes Purificacion. Marcelo Realon was survived by his heirs, namely, Ma. Luz Librado, Santiago Realon, Isidro R. Manabo, Rufina B. Mercado and Romel Realon. Only Joaquino, Florentino, Felipe, Sesinando and Montano are still alive. The four (4) respondents herein, who were the plaintiffs in the trial court, sought the nullification of the Contract to Sell in favor of the petitioner executed by Marciano and his brothers, as well as the Contract to Sell executed by Alfredo over the undivided shares in Lot No. 1253, the deed of sale with mortgage executed by Marciano Realon and his brothers, and the deed of sale with mortgage executed by Alfredo in favor of the petitioner. They likewise sought to nullify OCT No. O-2348 under the name of the petitioner and the reconveyance of the said lot to the respondents, free from all liens and encumbrances on their allegation that the petitioner committed fraud in the execution of the said deeds and in receiving the said title. Hence, all the surviving signatories to the said documents, namely, Joaquino, Francisco, Felipe, Sesinando and Montano, all surnamed Realon, and the other surviving heirs of Alfredo Realon and Marciano and Marcelo, were indispensable parties as plaintiffs. Moreover, if the trial court rendered judgment against the petitioner, ordering him to convey the property to the vendors, the latter, as the predecessorin-interest of the vendors, would have to refund to the vendee the amount they received from the latter. Hence, the respondents herein should have impleaded them in their complaint. However, the only plaintiffs impleaded in the complaint were the respondents herein, namely, Francisco, Domingo and Felipe, all surnamed Realon and Emiliano Purificacion. The surviving signatories of the assailed deeds and the other heirs of the deceased vendors were not impleaded as plaintiffs. Without the presence of all the other heirs as plaintiffs, the trial court could not validly render judgment and grant relief in favor of the respondents; it could, likewise, not rule in favor of the petitioner for the refund of his payments made to the respondents as the successors-in-interest of the vendors. The failure of the respondents to implead the said signatories and all the other heirs as parties-plaintiffs constituted a legal obstacle to the trial court and the appellate court's exercise of judicial power over the said case, and thereby rendered any orders or judgments made therein a nullity. 56 To reiterate, the absence of an indispensable party renders all subsequent actions of the court null and void for want of authority to act, not only as to the absent parties, but even as to those present. 57 Thus, the RTC should have ordered the dismissal of the complaint. 58 The Court notes that the respondents even failed to include the names of all the other heirs, including the signatories to the assailed deeds in the complaint and in the title thereof, and appending thereto a copy of any special power of attorney authorizing the respondents to sue in their respective capacity for said heirs. Thus, the petitioner was prevented from questioning the capacity of the said heirs to sue in their respective capacity either in a motion to dismiss the complaint or in his answer to the complaint. THCASc

The petitioner, thus, filed the instant petition for review on certiorari and assigned the following errors: I. THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR WHEN IT AFFIRMED IN TOTO THE DECISION OF THE COURT A QUO AND RULED THAT RESPONDENTS ARE ENTITLED TO A RECONVEYANCE OF THE SUBJECT PROPERTY CONSIDERING THAT THE LATTER FAILED TO PROVE THE EXISTENCE OF FRAUD UPON WHICH THE RELIEF SOUGHT WAS BASED. IaDSEA II. ASSUMING, ARGUENDO, THAT RESPONDENTS ARE ENTITLED TO THE RECONVEYANCE OF THE SUBJECT PROPERTY, THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR WHEN IT RULED THAT RESPONDENTS SHOULD ONLY REIMBURSE PETITIONER THE SUM OF PHP310,794.27, PLUS LEGAL INTEREST. III. THE COURT OF APPEALS COMMITTED REVERSIBLE ERROR WHEN IT AFFIRMED IN TOTO THE DECISION OF THE COURT A QUO AND RULED THAT RESPONDENTS ARE ENTITLED TO AN AWARD OF ATTORNEY'S FEES. 49 The petition is granted. The settled rule is that every action must be prosecuted or defended in the name of the real party-ininterest. 50 Where the action is allowed to be prosecuted or defended by a representative acting in a fiduciary capacity, the beneficiary must be included in the title of the case and shall be deemed to be the real party-ininterest. 51 The name of such beneficiaries shall, likewise, be included in the complaint. 52 Section 4, Rule 8 of the Rules of Court further provides that facts showing the capacity of a party to sue or be sued, or the authority of a party to sue or be sued in a representative capacity must be averred in the complaint. In order to maintain an action in a court of justice, the plaintiff must have an actual legal existence, that is, he or she or it must be a person in law and possessed of a legal entity as either a natural or an artificial person, and no suit can lawfully be prosecuted in the name of that person. The party bringing suit has the burden of proving the sufficiency of the representative character that he claims. If a complaint is filed by one who claims to represent a party as plaintiff but who, in fact, is not authorized to do so, such complaint is not deemed filed and the court does not acquire jurisdiction over the complaint. It must be stressed that an unauthorized complaint does not produce any legal effect. 53 Corollary, the defendant can assail the facts alleged therein through a motion to dismiss on the

We note that of the four (4) plaintiffs, Domingo Realon failed to sign the certification of non-forum shopping. On the other hand, the three other plaintiffs who signed the certification failed to append to the complaint a special power of attorney signed by all the surviving vendors and other heirs specifically authorizing them to sign the same for and in their behalf. This is fatal to the complaint and warrants the dismissal thereof. 59 In sum then, the trial court should have rendered judgment dismissing the respondents' complaint, and the Court of Appeals should have reversed the appealed decision of the RTC. Indeed, even if the complaint of the respondents did not suffer from any substantial defects, the appellate court should still have reversed the trial court's decision on the ground that the respondents failed to prove that the petitioner secured OCT No. O-2348 through actual or extrinsic fraud; and that the Contracts to Sell and Deeds of Sale with Mortgage were fraudulent. As a ground for the nullification of the decision in LRC Case No. 83-15, and OCT No. O-2348 issued on the basis thereof, fraud must be extrinsic or actual, and not intrinsic. The Court elaborated on the distinction of the two species of frauds, thus: Fraud may also be either extrinsic or intrinsic. Fraud is regarded as intrinsic where the fraudulent acts pertain to an issue involved in the original action, or where the acts constituting the fraud were or could have been litigated therein and is regarded as extrinsic where it prevents a party from having a trial or from presenting his entire case to the court, or where it operates upon matters pertaining not to the judgment itself but to the manner in which it is procured, so that there is no fair submission of the controversy. Extrinsic fraud is also actual fraud, but collateral to the transaction sued upon. The distinctions are significant because only actual fraud or extrinsic fraud has been accepted as grounds for a judgment to be annulled or, as in this case, a decree of registration reopened and reviewed. In the oft-citedMacabingkil v. People's Homesite and Housing Corporation case, the Court drew from American jurisprudence stating that "relief has been granted on the ground that, by some fraud practiced directly upon the party seeking relief against the judgment or decree, (and) that party has been prevented from presenting all of his case to the court." The "fraud" contemplated by the law in this case (Section 32, P.D. No. 1529) is actual and extrinsic, which includes an intentional omission of fact required by law. For fraud to justify a review of a decree, it must be extrinsic or collateral, and the facts upon which it is based have not been controverted or resolved in the case where the judgment sought to be annulled was rendered. Persons who were fraudulently deprived of their opportunity to be heard in the original registration case are entitled to a review of a decree or registration. 60

The allegation that the petitioner was the owner of the property is admittedly incorrect because the deeds executed by Marciano and Alfredo Realon on July 31, 1979 were the contracts to sell, under which the petitioner, as buyer, would acquire title over the property only upon his payment of the balance of the purchase price thereof on or before May 23, 1980; or the issuance of a torrens title in the names of the vendees and the execution by the seller of a final deed of sale. Also, the property was tenanted by respondent Emiliano Purificacion. When he filed his application on November 11, 1983, the petitioner had not yet paid the balance of the purchase price of the property. The vendors themselves failed to file an application for the issuance of a torrens title over the property in their names. Hence, the petitioner had not yet acquired ownership over the property when he filed his application. However, the Court believes that there was no intention on the part of the petitioner to deceive Alfredo and Marciano Realon, and deprive them of their right to be heard on the said application because (a) the petitioner appended to his application and adduced in evidence copies of the contracts to sell in favor of the petitioner executed by Alfredo and Marciano Realon, the latter for and in his behalf, and those of this brothers; and (b) Alfredo and Marciano Realon were served with copies of the notice of hearing of the said application, even testified for the petitioner and affirmed the validity of the said deeds. The respondents, as successors-in-interest of the vendees, can no longer assail the admissions of Alfredo and Marciano when they testified for the petitioner in LRC Case No. 8315. 61 As gleaned from the decision of the trial court, the petitioner still had a balance on the purchase price of the property due to the vendees amounting to P129,349.73. cHCaIE We agree with the appellate court that the RTC erred in its decision in LRC Case No. 83-15 declaring the petitioner, who was the applicant in the RTC, to be the legal owner of the property based on the contracts to sell executed in his favor by Alfredo and his nephews. However, there is no showing in the records that the decision was appealed to the Court of Appeals. Indeed, the decision had become final and executory, and the court had issued a decree based on its decision. In due course, the Register of Deeds issued OCT No. 1248 in favor of the petitioner. Hence, even if erroneous, the decision can no longer be altered. Consequently, the respondents were barred by the decision of the RTC in Civil Case No. BCV 94-28 from impugning the deed of sale with mortgage executed in favor of the petitioner by Alfredo and his nephews on January 8, 1985. In its decision in the said case, the RTC declared: At the trial, Engr. Aldersen Ilaban was called to the stand who testified that he is the authorized representative of the plaintiff, having been designated as administrator of his properties (Exh. "E"). He averred that his principal bought the parcel of land in question located at Carmona, Cavite, from its former owners, Alfredo Realon, Marciano Realon, in two (2) separate deeds of sale with mortgage (Exh. "A" & "B"). He further declared that the sellers undertook to deliver to the plaintiff the title covering the subject property upon payment of the balance of the purchase price. However, despite plaintiff's offer to pay the entire consideration of the sale after plaintiff exerted effort to secure the torrens title over the subject lot, defendants refused to accept the same in view of their demand for a higher consideration. This prompted plaintiff to write a letter to defendants on October 15, 1993 whereby he tendered payment of the remaining balance (Exh. "C"). Four months thereafter, he again wrote defendants advising them that if they would still refuse to accept the payment, he would deposit the amount of P42,849.23 directly in open court (Exh. "D"). 62 Considering that the respondents, as defendants therein, failed to appeal the decision, it became final and executory and can no longer be assailed. SAcaDE IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The assailed decision of the Court of Appeals in CAG.R. CV No. 68979, and that of the Regional Trial Court, are SET ASIDE. No costs.

In contrast to actual fraud, constructive fraud is construed as such because of its detrimental effect upon public interests, as well as public or private confidence in the Torrens System, even though the act is not done or committed with an actual design to commit positive fraud or injury upon other persons. CAETcH The records show that in his application in LRC Case No. 83-15, the petitioner, who was the applicant, alleged that he was the owner of the property, having acquired the same based on the Contract to Sell dated July 31, 1979, executed in his favor by Alfredo and Marciano Realon. He also alleged that the property was unoccupied and that there was no lien or encumbrance of any kind whatsoever affecting the said land, and that he had no knowledge of any person having any interest therein, legal or equitable.

LOTTE PHIL. CO., INC., petitioner, vs. ERLINDA DELA CRUZ, LEONOR MAMAUAG, LOURDES CAUBA, JOSEPHINE DOMANAIS, ARLENE CAGAYAT, AMELITA YAM, VIVIAN DOMARAIS, MARILYN ANTALAN, CHRISTOPHER RAMIREZ, ARNOLD SAN PEDRO, MARISSA SAN PEDRO, LORELI JIMENEZ, JEFFREY BUENO, CHRISTOPHER CAGAYAT, GERARD CABILES, JOAN ENRIQUEZ, JOSEPH DE LA CRUZ, NELLY CLERIGO, DULCE NAVARETTE, ROWENA BELLO, DANIEL RAMIREZ, AILEEN BAUTISTA and BALTAZAR FERRERA, respondents.

This petition for review on certiorari 1 assails the July 9, 2004 decision 2 of the Court of Appeals in CA-G.R. SP No. 72732 and its November 26, 2004 resolution 3 denying reconsideration thereof. The established facts of this case are as follows: Private respondent (petitioner herein) Lotte Phils., Inc. (Lotte) is a domestic corporation. Petitioners (respondents herein) are among those who were hired and assigned to the confectionery facility operated by private respondent. On December 14, 1995 and yearly thereafter until the year 2000 7J Maintenance and Janitorial Services ("7J") entered into a contract with private respondent to provide manpower for needed maintenance, utility, janitorial and other services to the latter. In compliance with the terms and conditions of the service contract, and to accommodate the needs of private respondent for personnel/workers to do and perform "piece works," petitioners, among others, were hired and assigned to private respondent as repackers or sealers. However, either in October, 1999 or on February 9, 2000, private respondent dispensed with their services allegedly due to the expiration/termination of the service contract by respondent with 7J. They were either told "hwag muna kayong pumasok at tatawagan na lang kung may gawa"; or were asked to wait "pag magrereport sila sa trabaho." Unfortunately, petitioners were never called back to work again. Aggrieved, petitioners lodged a labor complaint against both private respondent Lotte and 7J, for illegal dismissal, regularization, payment of corresponding backwages and related employment benefits, 13th month pay, service incentive leave, moral and exemplary damages and attorney's fees based on total judgment award.4 On February 28, 2001, Labor Arbiter Cresencio G. Ramos, Jr., rendered judgment 5 declaring 7J as employer of respondents. 6 The arbiter also found 7J guilty of illegal dismissal 7 and ordered to reinstate respondents, 8 pay P2,374,710.00 as backwages, P713,648.00 as 13th month pay and P117,000.00 as service incentive leave pay. 9 Respondents appealed to the National Labor Relations Commission (NLRC) praying that Lotte be declared as their direct employer because 7J is merely a labor-only contractor. In its decision 10 dated April 24, 2002, the NLRC found no cogent reason to disturb the findings of the labor arbiter and affirmed its ruling that 7J is the employer of respondents and solely liable for their claims. Respondents' motion for reconsideration was denied by the NLRC in a resolution dated June 18, 2002. Undaunted, they filed a petition for certiorari in the Court of Appeals 11 against the NLRC and Lotte, insisting that their employer is Lotte and not 7J. Lotte, however, denied that respondents were its employees. It prayed that the petition be dismissed for failure to implead 7J who is a party interested in sustaining the proceedings in court, pursuant to Section 3, Rule 46 of the Revised Rules of Civil Procedure. On July 9, 2004, the Court of Appeals reversed and set aside the rulings of the Labor Arbiter and the NLRC. In its decision, the Court of Appeals declared Lotte as the real employer of respondents and that 7J who engaged in laboronly contracting was merely the agent of Lotte. Respondents who performed activities directly related to Lotte's business were its regular employees under Art. 280 of the Labor Code. As such, they must be accorded security of tenure and their services terminated only on "just" and "authorized" causes. DSHcTC

Francisco Gerardo C. Llamas & Paul A. Bernardino for petitioner. Tagle-Chua Cruz & Aquino for respondents.

SYLLABUS 1.REMEDIAL LAW; CIVIL PROCEDURE; PARTIES TO CIVIL ACTIONS; INDISPENSABLE PARTIES; THE PRESENCE OF INDISPENSABLE PARTIES IS NECESSARY TO VEST THE COURT WITH JURISDICTION; CASE AT BAR. An indispensable party is a party in interest without whom no final determination can be had of an action, and who shall be joined either as plaintiffs or defendants. The joinder of indispensable parties is mandatory. The presence of indispensable parties is necessary to vest the court with jurisdiction, which is "the authority to hear and determine a cause, the right to act in a case". Thus, without the presence of indispensable parties to a suit or proceeding, judgment of a court cannot attain real finality. The absence of an indispensable party renders all subsequent actions of the court null and void for want of authority to act, not only as to the absent parties but even as to those present. In the case at bar, 7J is an indispensable party. It is a party in interest because it will be affected by the outcome of the case. The Labor Arbiter and the NLRC found 7J to be solely liable as the employer of respondents. The Court of Appeals however rendered Lotte jointly and severally liable with 7J who was not impleaded by holding that the former is the real employer of respondents. Plainly, its decision directly affected 7J. 2.ID.; ID.; ID.; ID.; COMPULSORY JOINDER OF INDISPENSABLE PARTIES; NON-JOINDER OF INDISPENSABLE PARTIES IS NOT A GROUND FOR THE DISMISSAL OF THE ACTION. In Domingo v. Scheer, we held that the nonjoinder of indispensable parties is not a ground for the dismissal of an action and the remedy is to implead the nonparty claimed to be indispensable. Parties may be added by order of the court on motion of the party or on its own initiative at any stage of the action and/or such times as are just. If the petitioner refuses to implead an indispensable party despite the order of the court, the latter may dismiss the complaint/petition for the petitioner/plaintiff's failure to comply therefor. 3.ID.; ID.; ID.; ID.; ID.; ID.; CASE AT BAR. Although 7J was a co-party in the case before the Labor Arbiter and the NLRC, respondents failed to include it in their petition for certiorari in the Court of Appeals. Hence, the Court of Appeals did not acquire jurisdiction over 7J. No final ruling on this matter can be had without impleading 7J, whose inclusion is necessary for the effective and complete resolution of the case and in order to accord all parties with due process and fair play.

DECISION

YNARES-SANTIAGO, J p:

Lotte's motion for reconsideration was denied, hence this petition, on the following issues: 8.Whether or not petitioner herein had the burden of proof to establish before the proceedings in the Court of Appeals that 7J Maintenance and Janitorial Service was not a labor-only contractor. 8.1.Whether or not the Petition in CA-G.R. SP No. 72732 is dismissible for failure to comply with Section 3, Rule 46 in relation to Section 5, Rule 65 of the 1997 Rules of Civil Procedure. 12 We first resolve the procedural issue raised by petitioner. Lotte asserts that 7J is an indispensable party and should have been impleaded in respondents' petition in the Court of Appeals. It claims that the petition before the Court of Appeals was dismissible for failure to comply with Section 3, 13 Rule 46 in relation to Section 5 14 of Rule 65 of the Revised Rules of Civil Procedure. cITCAa Petitioner's contention is tenable. An indispensable party is a party in interest without whom no final determination can be had of an action, 15 and who shall be joined either as plaintiffs or defendants. 16 The joinder of indispensable parties is mandatory. 17 The presence of indispensable parties is necessary to vest the court with jurisdiction, which is "the authority to hear and determine a cause, the right to act in a case". 18 Thus, without the presence of indispensable parties to a suit or proceeding, judgment of a court cannot attain real finality. 19 The absence of an indispensable party renders all subsequent actions of the court null and void for want of authority to act, not only as to the absent parties but even as to those present. 20 In the case at bar, 7J is an indispensable party. It is a party in interest because it will be affected by the outcome of the case. The Labor Arbiter and the NLRC found 7J to be solely liable as the employer of respondents. The Court of Appeals however rendered Lotte jointly and severally liable with 7J who was not impleaded by holding that the former is the real employer of respondents. Plainly, its decision directly affected 7J. In Domingo v. Scheer, 21 we held that the non-joinder of indispensable parties is not a ground for the dismissal of an action 22 and the remedy is to implead the non-party claimed to be indispensable. 23 Parties may be added by order of the court on motion of the party or on its own initiative at any stage of the action and/or such times as are just. If the petitioner refuses to implead an indispensable party despite the order of the court, the latter may dismiss the complaint/petition for the petitioner/plaintiff's failure to comply therefor. 24 Although 7J was a co-party in the case before the Labor Arbiter and the NLRC, respondents failed to include it in their petition for certiorari in the Court of Appeals. Hence, the Court of Appeals did not acquire jurisdiction over 7J. No final ruling on this matter can be had without impleading 7J, whose inclusion is necessary for the effective and complete resolution of the case and in order to accord all parties with due process and fair play. IaTSED In light of the foregoing, the Court sees no need to discuss the second issue raised by petitioner.

DIOSDADA EDOROT, JUANA EDOROT, and the latae HERMINIGILDO EDOROT, represented by his heirs. VICTOR EDOROT, PEDRITO EDOROT and JACOBO EDOROT, respondents.

SYLLABUS 1.REMEDIAL LAW; CIVIL PROCEDURE; ACTION; FAILURE TO COMPLY WITH ORDER TO AMEND, GROUND FOR DISMISSAL OF COMPLAINT. The heirs of deceased defendants in the case at bar being clearly indispensable parties, respondent Judge acted properly in ordering the amendment of the complaint so as to include the said heirs as defendants. Since the petitioners failed to comply with this Order, respondent Judge acted within his prerogative in dismissing the complaint pursuant to Section 3, Rule 17 of the Rules of Court which provides that "Where the Court orders the plaintiff to amend its complaint within a certain period of time in order to implead as party defendants one who is not a party to the case but who is an indispensable party, plaintiff's refusal to comply with such order is a ground for the dismissal of the complaint." 2.ID.; ID.; ID.; RELIANCE ON RULE 3, SEC. 16, RULES OF COURT, MISPLACED; CASE AT BAR. Petitioners now claim that their failure to amend the complaint was due to the fact that private respondents' counsel failed to inform the Court of the names of the heirs and/or representatives of the deceased defendants (Herminigildo and Petra Edorot) pursuant to Section 16, Rule 3, New Rules of Court. We find petitioners' reliance on the aforequoted provision as misplaced. Rule 3, Section 16 of the Rules applies to a situation where a party (whether plaintiff or defendant) dies after the filing of the complaint and during the pendency of the case. Thus is not the situation in the case at bar since the two defendants, whose heirs are to be impleaded died even before the filing of the complaint. 3.ID.; ID.; ID.; AMENDMENT OF COMPLAINT; STILL REQUIRED DESPITE WAIVER OF ONE OF THE HEIRS. The other contention of petitioners that there is no more necessity of amending the complaint because allegedly an affidavit of waiver of rights have been executed by one Victor Edorot is also not meritorious, It is not disputed that said Victor Edorot is only one of the heirs of deceased defendant Herminigildo Edorot. He is not the sole owner of the entire interest of Herminigildo. Neither is his waiver binding upon the other heirs of said deceased. 4.ID.; ID.; NON-CONTENTIOUS MOTION; MAY BE ACTED UPON WITHOUT PROOF OF SERVICE TO ADVERSE PARTY. Finally, anent the contention of petitioners that private respondents "ex-parte manifestation" did not comply with the required notice of motions pursuant to Sections 4, 5 and 6 of Rule 15 of the Rules of Court, suffice it to state that the said "manifestation" informing the Court that petitioners have not complied with the order to amend the complaint, is not a litigated or contentious motion and may be acted upon even without proof of service on the adverse party.

DECISION

CUEVAS, J p: WHEREFORE, the July 9, 2004 decision of the Court of Appeals in CA-G.R. SP No. 72732 and the November 26, 2004 resolution, are SET ASIDE. Let the case be REMANDED to the Court of Appeals to include 7J Maintenance and Janitorial Services as an indispensable party to the case for further proceedings. MR. & MRS. TADEO P. DAEL, petitioners, vs. THE HON. BERNARDO TEVES, as Presiding Judge, Court of First Instance of Misamis Oriental, Branch VIII and DIONISIO EDOROT, VIDAL EDOROT, PONCIANO EDOROT, PETRA EDOROT, Petition for Review on Certiorari of the Order of the Hon. respondent Presiding Judge of the Court of First Instance of Misamis Oriental Branch VIII, issued on July 27, 1971 in Civil Case No. 3531 entitled "Mr. & Mrs. Tadeo P. Dael versus Dionisio Edorot, et al", dismissing petitioners' complaint; and his Honor's order of August 12, 1971 denying petitioners' motion for reconsideration of the said order of dismissal.

On October 19, 1970, petitioners filed with the then Court of First Instance of Misamis Oriental, a complaint for: "Ownership, Recovery of Possession & Damages" against the private respondents. The case was docketed in the said court as Civil Case No. 3531. The complaint, among others, alleged that petitioners, then plaintiffs, are the true and absolute owners in fee simple of a parcel of land with an area of 18,000 square meters, more or less, situated at Aplaya, Jasaan, Misamis Oriental, having purchased the same from the late Esteban Edorot on May 17, 1962; and that sometime in the month of February 1964, after the death of Esteban Edorot, the defendants (herein private respondents) by means of force, threats and intimidation surreptitiously occupied the said property. Private respondents, through counsel, filed their Answer with Counterclaim on January 18, 1971, claiming that the property in question is owned by them pro-indiviso by inheritance from their deceased parents. The issue having been joined, the case was set for pre-trial on various occasions in Branch VIII of the Court of First Instance of Misamis Oriental then still presided by the Hon. Severo Malvar "to give the parties more chance to arrive at an amicable settlement." 1 In all these pre-trial conferences, counsel for private respondents and respondent Vidal Edorot appeared. The latter had a special power of attorney to appear for defendants Dionisio, Diosdada, Ponciano and Juana. The two other defendants, Petra and Herminigildo, died long before the filing of the complaint. LexLib After June 2, 1971, Judge Severo Malvar was transferred to another judicial district and respondent Judge BernardoTeves was appointed to take his place. On June 29, 1971 when the case was set for pre-trial for the first time before respondent Judge Bernardo Teves, an Order reading as follows "Considering that, as manifested before the Court, two of the defendants died before the filing of this case; the plaintiffs are hereby given until July 15, 1971 within which to file an amended complaint to include the heirs or representatives of said deceased defendants, furnishing copy thereof to Atty. Dumlao." was issued by the respondent Judge. On July 27, 1971, counsel for private respondents filed an Ex-Parte Manifestation, praying that the case be dismissed pursuant to Section 3, Rule 17 of the Rules of Court for failure of petitioners to comply with the aforequoted order of the Court to file an amended complaint. Acting thereon, the trial court on July 27, 1971 issued the order now assailed dismissing the complaint, which reads "As prayed for by the defendants, through counsel, Atty. Florentino Dumlao, Jr. in his exparte manifestation of July 27, 1971, which the Court finds well-founded, this case is hereby dismissed for failure of the plaintiffs to comply with the Order of this Court dated June 29, 1971. No pronouncement as to costs. SO ORDERED." Petitioners' motion to reconsider the foregoing Order having been denied, they now come before Us through the instant petition, contending that respondent Judge

1.acted without jurisdiction or with grave abuse of discretion in ordering petitioners to file an amended complaint, to include the alleged heirs and or representatives of respondents Petra Edorot and Herminigildo Edorot, deceased; 2.committed a legal error in admitting respondents' ex-parte motion to dismiss Civil Case No. 3531 and in issuing the order dismissing Civil Case No. 3531; and 3.acted without or in excess of its jurisdiction in denying petitioners' motion for reconsideration. In their complaint, petitioners (then plaintiffs) claim that they are the owners of the parcel of land in question. 2 Private respondents, on the other hand, in their Answer controvert such assertion. 3 They also claim to be the owners and possessors, pro-indiviso by inheritance from their deceased parents, of the subject litigated parcel. Necessarily then, deceased defendants Herminigildo Edorot and Petra Edorot have an undivided interest, right and participation adverse to that of the petitioners' in the property in litigation. Since both of them are already dead (Herminigildo died on September 29, 1969 and Petra died on April 5, 1970) even prior to the filing of the complaint against them in the court below and their interest in the property in question having inured by intestacy to their heirs, the latter thereby became the real parties in interest who should be impleaded as defendants without whom no final determination of Civil Case No. 3531 can be had. Decidedly then they are indispensable parties who should be compulsory joined as defendants in the instant case. Sections 2 and 7, Rule 3 of the Rules of Court provides "Section 2.Parties in interest. Every action must be prosecuted and defended in the name of the real party in interest. All persons having an interest in the subject of the action and in obtaining the relief demanded shall be joined as plaintiffs. All persons who claim an interest in the controversy or the subject thereof adverse to the plaintiff, or who are necessary to complete determination or settlement of the question involved therein shall be joined as defendants." "Section 7.Compulsory joinder of indispensable parties. Parties in interest without whom no final determination can be had of an action shall be joined either as plaintiffs or defendants." The heirs of deceased defendants in the case at bar being clearly indispensable parties, respondent Judge acted properly in ordering the amendment of the complaint so as to include the said heirs as defendants. Since the petitioners failed to comply with this Order, respondent Judge acted within his prerogative in dismissing the complaint 4 pursuant to Section 3, Rule 17 of the Rules of Court which provides that "If the plaintiff fails to appear at the time of the trial, or to prosecute his action for unreasonable length of time, or to comply with these rules or any order of the court, the action maybe dismissed upon motion of the defendant or upon the court's own motion. This dismissal shall have the effect of an adjudication upon the merits unless provided by the court. (Italics supplied). Thus, it has been held that "Where the Court orders the plaintiff to amend its complaint within a certain period of time in order to implead as party defendants one who is not a party to the case but who is an indispensable party, plaintiff's refusal to comply with such order is a ground for the dismissal of the complaint." (Garchitorena, et al. vs. de los Santos, et al., No. L-17045, June 30, 1962, 115 Phil. 490, citing Bautista vs. Teodoro, 54 O.G. 619; Dizon vs. Garcia, et al., G.R. No. L14690, November 29, 1960)

Petitioners now claim that their failure to amend the complaint was due to the fact that private respondents' counsel failed to inform the Court of the names of the heirs and/or representatives of the deceased defendants (Herminigildo and Petra Edorot) pursuant to Section 16, Rule 3, New Rules of Court which provides "Section 16.Duty of attorney upon death, incapacity or incompetency of party. Whenever a party to a pending case dies, becomes incapacitated, or incompetent, it shall be the duty of his attorney to inform the court promptly of such death, incapacity or incompetency and to give the name and residence of his executor, administrator, guardian or other legal representative." (Italics supplied) We find petitioners' reliance on the aforequoted provision as misplaced. Rule 3, Section 16 of the Rules applies to a situation where a party (whether plaintiff or defendant) dies after the filing of the complaint and during the pendency of the case. Thus is not the situation in the case at bar since the two defendants, whose heirs are to be impleaded died even before the filing of the complaint. llcd The other contention of petitioners that there is no more necessity of amending the complaint because allegedly an affidavit of waiver of rights have been executed by one Victor Edorot is also not meritorious, It is not disputed that said Victor Edorot is only one of the heirs of deceased defendant Herminigildo Edorot. He is not the sole owner of the entire interest of Herminigildo. Neither is his waiver binding upon the other heirs of said deceased. Finally, anent the contention of petitioners that private respondents "ex-parte manifestation" did not comply with the required notice of motions pursuant to Sections 4, 5 and 6 of Rule 15 of the Rules of Court, suffice it to state that the said "manifestation" informing the Court that petitioners have not complied with the order to amend the complaint, is not a litigated or contentious motion and may be acted upon even without proof of service on the adverse party. 5 In fact, under Section 3 of Rule 17, quoted earlier, the Court can motu proprio or on its own motion, dismiss the case for failure to comply with its order. Upon the foregoing facts, We find that respondent Judge committed no error in dismissing the complaint. However, to avoid injustice, such dismissal should not operate as an adjudication on the merits. 6 WHEREFORE, the lower court's Order of dismissal, which should be understood to be without prejudice, is AFFIRMED. Cost against petitioners. CRISANTA F. SENO, CAROLA SENO SANTOS, MANUEL SENO, JR., DIANA SENO CONDER, EMILY SENO and WALTER SENO, plaintiffs, vs. MARCOS MANGUBAT and Spouses FRANCISCO LUZAME and VERGITA PEAFLOR, ANDRES EVANGELISTA and BIENVENIDO MANGUBAT,defendants.

This case stemmed from a complaint filed by plaintiffs on August 29, 1969 seeking 1) the reformation of a Deed of Sale executed in favor of defendant Marcos Mangubat and, 2) the annulment of a subsequent sale to defendant spouses Francisco Luzame and Vergita Peaflor of a parcel of land in Barrio Dongalo, Paraaque, Rizal covered by OCT No. 1197 of the Land Registry of Rizal. The material allegations of the complaint so far as they affect the present appeal are to the following effect: that plaintiff Crisanta Seno, a widow, approached defendant Marcos Mangubat sometime in 1961 to negotiate with him a mortgage over the subject parcel of land so she can pay off a previous indebtedness; that she had herein defendant agreed on a mortgage for the sum of P15,000.00 with interest of 2% a month payable every month and that as long as the interest is being paid, the mortgage over the property will not be foreclosed; that on the assurance of defendant Marcos Mangubat, a practicing lawyer, that he will respect their true agreement on the mortgage, plaintiff Crisanta F. Seno agreed to the execution of a Deed of Absolute Sale over the subject property for a consideration of P5,000.00 in favor of defendant Marcos Mangubat and certain Andres Evangelista and Bienvenido Mangubat on July 17, 1961; 3 that defendant Marcos Mangubat was able to obtain a title in his name and the other alleged vendees Andres Evangelista and Bienvenido Mangubat; that on January 8, 1962 Andres Evangelista and Bienvenido Mangubat executed a Deed of Absolute Sale transferring their share in the subject property to defendant Marcos Mangubat; that defendant Marcos Mangubat was able to obtain a title over the subject property in his name by virtue of this latter sale; that plaintiff Crisanta F. Seno continued paying defendant Marcos Mangubat the usurious 2% interest per month; that sometime in 1963, when plaintiff Crisanta F. Seno failed to pay the monthly interest of 2%, she was sued for ejectment by defendant Marcos Mangubat alleging nonpayment of rentals; that sometime in the later week of January 1969, plaintiff Crisanta F. Seno learned that defendant Marcos Mangubat sold the subject property in favor of spouses Francisco Luzame and Vergita Peaflor for the sum of P10,000.00 on January 14, 1969; 4 that defendant spouses Francisco Luzame and Vergita Peaflor bought the property in bad faith since they had knowledge of the circumstances surrounding the transaction between plaintiff and defendant Marcos Mangubat; that defendant spouses Luzame filed an ejectment case against plaintiff Crisanta Seno for alleged non-payment of rentals. prLL On motion of defendant spouses Luzame and Peaflor, the trial court ordered on October 20, 1975 the inclusion as defendants of Andres Evangelista and Bienvenido Mangubat on the ground that they are indispensable parties, on December 29, 1971, plaintiffs filed their amended complaint in compliance with the court's order of October 20, impleading Andres Evangelista and Bienvenido Mangubat as defendants. The newly impleaded defendants moved for the dismissal of the case against them on the ground of prescription which motion was granted by the court in its order of July 3, 1972, the dispositive portion of which reads "xxx xxx xxx "Considering that under Art. 1144 of the Civil Code of the Philippines, an action upon a written contract must be brought within 10 years from the time the right of action accrued and considering further the opposition of plaintiffs which we find to be justified and meritorious, this Court resolves to dismiss as it hereby dismisses the case only as against defendants Andres Evangelista and Bienvenido Mangubat. "xxx xxx xxx" 5

DECISION

GANCAYCO, J p: This is an appeal that was certified to this Court by the Court of Appeals 1 from the order of the Court of First Instance of Rizal, Branch I, dated September 29, 1972 in Civil Case No. 12205 dismissing the action for reformation of instrument and annulment of subsequent sale. 2

Defendants Luzame and Peaflor in their motion for reconsideration represented by Atty. Jose Manacop and defendant Marcos Mangubat in his Supplement to motion for reconsideration or in support of Atty. Manacop's motion for reconsideration asked the court a quo to dismiss the case against all the defendants. The court a quo in its order of September 27, 1972 reconsidered its order of July 3rd and dismissed the case against all the defendants holding that the court is no longer in a position to grant plaintiffs' demands, principally the reformation of subject Deed of Absolute Sale.

The motion for reconsideration filed by the plaintiffs of the foregoing order was denied by the trial court in its order of January 17, 1973; 6 hence, an appeal was brought before the Court of Appeals praying for the reversal of the orders of the court a quo dated September 27, 1972 and January 17, 1973 and for the remand of the case to the court a quo for further proceedings. The Court of Appeals certified the instant case to this Court holding that the assignment of errors made by plaintiffs in their appeal raised purely legal questions, to wit 1)Are defendants Andres Evangelista and Bienvenido Mangubat indispensable parties in the case without whom no action can be properly taken thereon? 2)If they are such, has the action prescribed against them in view of Art. 1144, Civil Code? 3)If they are not, was the dismissal of said defendants a legal grounds for dismissal of the complaint as against the other defendants? and 4)Was the dismissal of the case without a hearing on the merits in accordance with law? 7 The first issue We need to resolve is whether or not defendants Andres Evangelista and Bienvenido Mangubat are indispensable parties. Plaintiffs contend that said defendants being mere dummies of defendant Marcos Mangubat and therefore not real parties in interest, there is no room for the application of Sec. 7, Rule 3 of the Rules of Court. For the determination of this issue, We find it necessary to consider the distinction between indispensable and proper parties as clearly stated in Sections 7 and 8, Rule 3 of the Revised Rules of Court which provide: LexLib "Sec. 7.Compulsory joinder of indispensable parties. Parties in interest without whom no final determination can be had of an action shall be joined either as plaintiffs or defendants." "Sec. 8.Joinder of proper parties. When persons who are not indispensable but who ought to be parties if complete relief is to be accorded as between those already parties, have not been made parties and are subject to the jurisdiction of the court as to both service of process and venue, the court shall order them summoned to appear in the action. But the court may, in its discretion, proceed in the action without making such persons parties, and the judgment rendered therein shall be without prejudice to the rights of such persons." Under Section 7, indispensable parties must always be joined either as plaintiffs or defendants, for the court cannot proceed without them. Necessary parties 8 must be joined, under Section 8, in order to adjudicate the whole controversy and avoid multiplicity of suits. 9 Indispensable parties are those with such an interest in the controversy that a final decree would necessarily affect their rights, so that the courts cannot proceed without their presence. Necessary parties are those whose presence is necessary to adjudicate the whole controversy, but whose interests are so far separable that a final decree can be made in their absence without affecting them. 10 Defendants cite Alberto vs. Mananghala 11 to support their theory that defendants Andres Evangelista and Bienvenido Mangubat are indispensable parties. Thus xxx xxx xxx

"One of the issues raised by the parties is whether the transactions carried out by and between Arcadio Ramos and the deceased Vicente Feliciano is a sale with pacto de retro or simply an equitable mortgage. If it be held that it is an equitable mortgage, then their right would be defeated and they would be held liable for warranty and eviction under the law to Casimiro Mananghala. This being so, it would seem clear that the presence of all the heirs of Vicente Feliciano in this case is indispensable in order that they may protect their interests. They are entitled to be heard. They may have a valid defense which may have the effect of defeating the claim of the plaintiff. This however, was not done, for some of the heirs of Vicente Feliciano were not served with summons and consequently have not entered their appearance. This is in violation of Section 7, Rule 3 of the Rules of Court. "xxx xxx xxx We, however, find this case inapplicable to the case at bar. In the present case, there are no rights of defendants Andres Evangelista and Bienvenido Mangubat to be safeguarded if the sale should be held to be in fact an absolute sale nor if the sale is held to be an equitable mortgage. Defendant Marcos Mangubat became the absolute owner of the subject property by virtue of the sale to him of the shares of the aforementioned defendants in the property. Said defendants no longer have any interest in the subject property. However, being parties to the instrument sought to be reformed, their presence is necessary in order to settle all the possible issues of the controversy. Whether the disputed sale be declared an absolute sale or an equitable mortgage, the rights of all the defendants will have been amply protected. Defendants-spouses Luzame in any event may enforce their rights against defendant Marcos Mangubat.

In fact the plaintiffs were not after defendants Andres Evangelista and Bienvenido Mangubat as shown by their noninclusion in the complaint and their opposition to the motion to include said defendants in the complaint as indispensable parties. It was only because they were ordered by the court a quo that they included the said defendants in the complaint. The lower court erroneously held that the said defendants are indispensable parties. Cdpr Notwithstanding, defendants Andres Evangelista and Bienvenido Mangubat not being indispensable parties but only proper parties, their joinder as parties defendants was correctly ordered being in accordance with Sec. 8 of Rule 3. We, therefore, need to settle the next issue of whether the action against them has prescribed in view of Art. 1144, Civil Code, which provides: "The following actions must be brought ten years from the time the right of action accrues: "1)Upon a written contract; xxx xxx xxx" The complaint clearly alleged that the deed of sale executed on July 17, 1961 did not express the true intention of the parties and should be reformed into the mortgage it actually was. Such allegations are binding for purposes of determining the motion to dismiss (which hypothetically admits the allegations in the complaint). The prescriptive period for such actions based upon a written contract and for reformation thereof is ten years as provided in Article 1144 of the Civil Code. Such right to reformation is expressly recognized in Article 1365 of the same Code which provides:

"If two parties agree upon the mortgage or pledge of real or personal property, but the instrument states that the property is sold absolutely or with a right of repurchase, reformation of the instrument is proper." 12 Article 1605 of the Civil Code 13 in conjunction with Article 1604 14 likewise allows the apparent vendor to ask for the reformation of the instrument. Plaintiffs argue that: "A grave and palpable error was committed by the court a quo in holding that the prescriptive period must be counted from the date of execution of the deed of sale on July 17, 1961 up to the date of filing of the Amended Complaint on December 29, 1971." "The important reckoning point is the date of filing of the original complaint on August 29, 1969. It has been held that amendments in pleadings do not necessarily expunge those previously filed; That amendments made, more so when ordered by the court, relate back to the date of the original complaint, as in the case at bar, the claim asserted in the amended pleading arose out of the same conduct, transaction or occurrence, and that amendment presupposes the existence of something to be amended, and, therefore, the tolling of the period should relate back to the filing of the pleading sought to be amended (Philippine Independent Church v. Mateo, et al., L-14793, April 28, 1961." 15 In the case of Pangasinan Transportation Co. vs. Philippine Farming Co., Ltd., 16 this Court held that where the original complaint states a cause of action but does it imperfectly and afterwards an amended complaint is filed correcting the defect, the plea of prescription will relate to the time of the filing of the original complaint. However, in the case of Aetna Insurance Co. vs. Luzon Stevedoring Corporation, 17 We held that this rule would not apply to the party impleaded for the first time in the amended complaint. In Aetna, the defendant Barber Lines Far East Service was impleaded for the first time in the amended complaint which was filed after the one-year period for prescription. The order of the lower court dismissing the amended complaint against the said defendant was affirmed by this Court. In the instant case, defendants Andres Evangelista and Bienvenido Mangubat were only impleaded in the amended complaint of December 29, 1971 or ten (10) years, five (5) months and twelve (12) days from July 17, 1961 the date of execution of the subject Deed of Absolute Sale, clearly more than the ten (10) year prescriptive period. Anent the third and fourth issues, the theory of the plaintiffs is that the complaint should not have been dismissed as against said defendants but instead the court a quo should have proceeded with a trial on the merits because there is an issue of fact appearing on the pleadings, that is, that defendants Andres Evangelista and Bienvenido Mangubat were mere dummies of defendant Marcos Mangubat. It should be remembered that the court a quo dismissed the complaint against defendants Andres Evangelista and Bienvenido Mangubat upon their motion to dismiss on the ground of prescription. LLpr Section 3, Rule 16 relating to motion to dismiss, provides that "after hearing, the court may deny or grant the motion or allow amendment, or may defer the hearing and determination of the motion until the trial if the ground alleged therein does not appear to be indubitable."

A motion to dismiss on the ground of prescription will be given due course only if the complaint shows upon its face that the action has already prescribed. 18 If it does not so appear, the determination of the motion to dismiss must be deferred until trial. 19 Under the circumstances of this case, the ground of prescription alleged by aforementioned defendants was apparent on the face of the complaint. As earlier pointed out in this decision, the action against said defendants has prescribed. The court a quo properly ordered its dismissal as what it originally did in its order of July 3, 1972. The plaintiffs now maintain that assuming the action against defendants Andres Evangelista and Bienvenido Mangubat had already prescribed, this defense was personal to them and could not legally encompass the position of defendant Marcos Mangubat; that the latter defendant, could be held solely responsible to plaintiffs, having become absolute owner of the property subject matter of the July 17, 1961 instrument, or in the least he could be held accountable for his 1/3 share of the property. 20 One case which the lower court particularly applied to justify dismissal of the case against the other defendants was Pillado vs. Francisco. 21 In said case, plaintiffs filed an action for the annulment of the contract of sale of a certain real estate executed by the Philippine National Bank (PNB) in favor of the spouses Estela Francisco and Vivencio Lasala. Defendant PNB submitted an answer while defendant spouses filed a motion to dismiss on the ground that the complaint stated no cause of action and that plaintiffs have no legal capacity to sue. Said defendant spouses subsequently filed an additional motion to dismiss on the ground that the cause of action of plaintiff, if any, had prescribed. The court ordered the dismissal of the complaint which dismissal became final. Plaintiffs then asked the court to continue the case against PNB but the latter moved for the dismissal on the ground that the court had lost, or had been divested of its jurisdiction over the case through the release of the defendant spouses, who were indispensable parties. The court granted the motion to dismiss holding that defendant spouses who were the vendees were indispensable parties in an action for the rescission of the sale. From this order, the plaintiff appealed to this Court. This Court affirmed the order holding that the indispensable parties having been discharged by the trial court, the Court is no longer in a position to grant the plaintiff's demands, principally the revocation of the Deed of Sale in their favor. As We have already held that defendants Andres Evangelista and Bienvenido Mangubat are not indispensable but proper parties, Pillado cannot therefore, be applied to the case at bar. In that case, the parties discharged were indispensable being the purchasers and the present holders of the subject property. In the instant case, the parties discharged were the original vendees who have since transferred their interest in the subject property to one of the original co-vendees, and the latter after having been vested with absolute title over the subject property sold the same to defendants spouses Luzame. Whereas in the former case, the court was no longer in a position to grant the relief sought by the plaintiffs, in the latter, the trial court may still be able to grant plaintiffs' demands for reformation of the instrument and annulment of subsequent sale if after trial on the merits, plaintiffs prove their allegations that defendants Andres Evangelista and Bienvenido Mangubat were in fact were dummies of Marcos Mangubat and that the sale executed on July 17, 1961 was in reality an equitable mortgage. By the dismissal of the case against defendants Andres Evangelista and Bienvenido Mangubat, the court a quo had lost jurisdiction over them. We have already pointed out that the joinder of proper parties is necessary in order to determine all the possible issues of the controversy; but if for some reason or another it is not possible to join them, as when they are out of the jurisdiction of the Court, the court may proceed without them, and the judgment that may be rendered shall be without prejudice to their rights. 22 Hence, notwithstanding the absence of said defendants, the court could still proceed with the trial of the case as against the remaining defendants in accordance with Sec. 8 of Rule 3. Nevertheless, the court is constrained to affirm the dismissal of the complaint against all the defendants as there is merit in the argument raised by defendants-appellees that plaintiffs are barred by laches to bring suit against them. prLL

Laches (or estoppel by laches) is unreasonable delay in the bringing of a cause of action before the courts of justice. 23As defined by this Court, "laches is failure or neglect for an unreasonable and unexplained length of time, to do that which by exercising due diligence, could or should have been done earlier, it is negligence or omission to assert a right within a reasonable time, warranting a presumption that the party entitled thereto either has abandoned it or declined to assert it. 24

Defendant spouses, however, claim that they came to know of the existence of the original title of plaintiff Crisanta Seno only when they verified the title to the land in 1969 when it was being offered to them by co-defendant Marcos Mangubat. They deny that they are neighbors much less friends of plaintiffs. In order that a purchaser of land with a Torrens title may be considered as a purchaser in good faith, it is enough that he examines the latest certificate of title which in this case is that issued in the name of the immediate transferor. 29The purchaser is not bound by the original certificate of title but only by the certificate of title of the person from whom he has purchased the property. 30 Good faith, while it is always to be presumed in the absence of proof to the contrary, requires a well-founded belief that the person from whom title was received was himself the owner of the land, with the right to convey it. 31 In this regard, a buyer of real estate should exercise ordinary care in purchasing land, 32 so that one who purchases real property should make inquiries about the right of those in possession thereof. 33 The well-known rule in this jurisdiction is that a person dealing with a registered land has a right to rely upon the face of the Torrens Certificate of Title and to dispense with the need of inquiring further, except when the party concerned has actual knowledge of facts and circumstances that would impel a reasonably cautious man to make such inquiry. 34 It is true that by the possession of plaintiffs of the subject property, defendant spouses Luzame should have been put on their guard and should have taken precautionary steps in ascertaining the interest of the possessors of the land. The defendant spouses did verify the title to the property with the Register of Deeds and finding that the latest title was in the name of defendant Marcos Mangubat, they, had every reason to rely on such title. Besides, there was the ejectment suit filed by defendant Marcos Mangubat against plaintiff Crisanta Seno which was decided in favor of the former. The defendant spouses could not be faulted for believing that the possession of the plaintiffs was in the concept of lessee; in fact said defendant spouses also filed an ejectment suit against plaintiffs. This Court had occasion to rule that possession by the appellees, either by themselves or through their predecessors in interest, if there was such possession at all, would be unavailing against the holder of a Torrens Certificate of Title covering the parcels of land now in question. 35 Thus, where innocent third persons relying on the correctness of the certificate of title issued, acquire rights over the property, the court cannot disregard such rights and order the total cancellation of the certificate for that would impair public confidence in the certificate of title; otherwise everyone dealing with property registered under the torrens system would have to inquire in every instance as to whether the title had been regularly or irregularly issued by the court. Indeed, this is contrary to the evident purpose of the law. Every person dealing with registered land may safely rely on the correctness of the certificate of title issued therefore and the law will in no way oblige him to go behind the certificate to determine the condition of the property. Stated differently, an innocent purchaser for value relying on a torrens title issued is protected. 36 We therefore hold and find that defendants spouses Luzame are purchasers in good faith and for value of the questioned property. LibLex IN VIEW OF THE FOREGOING CONSIDERATIONS, the order of dismissal dated September 29, 1972 and the order denying the motion for reconsideration dated January 13, 1973 of the Court of First Instance of Rizal, Branch I, are hereby AFFIRMED. No costs. NICENCIO TAN QUIOMBING, petitioner, vs. COURT OF APPEALS, and Sps. FRANCISCO and MANUELITA A. SALIGO, respondents.

A perusal of the records shows that from the time of the execution of the deed of sale on July 17, 1961 to the time of the filing of the present complaint on August 29, 1969 or a period of 8 years, 1 month and 12 days, plaintiffs never took any step to enforce their rights which they claim to have despite the several opportunities available to them. Defendant Marcos Mangubat filed an ejectment suit against plaintiff Crisanta Seno in 1963 and this fact was admitted by the plaintiffs in their complaint. For failure of plaintiff to appear in the case, a decision was rendered by the trial court ordering plaintiffs to vacate the subject property 25 which decision was duly executed. 26 It further appears from the complaint that plaintiffs were well aware of the transfer of the title from the name of plaintiff Crisanta Seno to the names of defendants Marcos Mangubat, Andres Evangelista and Bienvenido Mangubat and subsequently to the name of defendant Marcos Mangubat alone as early as 1963 when the ejectment case was filed against plaintiffs, and also they did not do anything about it. In January 1969, plaintiffs learned of the sale of the subject property to defendants-spouses Luzame. but it was only on August 29, 1969 when plaintiffs brought this action and only after an ejectment case was filed by said defendant spouses against plaintiff Crisanta Seno before the Municipal Court of Paraaque, Rizal on August 4, 1969. As defendants-appellees contend, before the nine-year period lapsed, plaintiffs never raised a voice to protest against all these proceedings. They chose to sleep on their rights and to rely on defendants' alleged word that their true agreement would be respected rather than bring their grievances to a court of law. However, when an ejectment case was filed against them just when the 10-year prescriptive period for bringing of their suit was nearly over, they finally decided to stake their claim against the defendants. The essence of laches is not merely lapse of time. It is essential that there be also acquiescence in the alleged wrong or lack of diligence in seeking a remedy. 27 The doctrine of laches or of "stale demands" is based on public policy which requires, for the peace of society, the discouragement of stale claims and, unlike the statute of limitations not a mere question of time but is principally a question of the inequity or unfairness of permitting a right or claim to be enforced or asserted. 28 By the negligence of plaintiffs in asserting their rights for an unreasonable length of time, they are now forever precluded from enforcing whatever right they may have against defendants. Indeed, it is an indicia of the infirmity of their claim. prLL Moreover, as against plaintiff's allegation that the defendant spouses Luzame are purchasers in bad faith, We hold that the legal presumption of good faith on the part of said defendant spouses must prevail. Plaintiffs would have Us believe that defendant spouses being their erstwhile neighbors and friends had knowledge of the circumstances surrounding the transaction between plaintiff Crisanta Seno and Defendant Marcos Mangubat which therefore makes them purchasers in bad faith.

M.B. Tomacruz Law Office for petitioner. Jose J. Francisco for private respondents.

contract. If, as was possible, the answer should allege a breach of the agreement, "the trial court cannot decide the dispute without the involvement of Biscocho whose rights will necessarily be affected since he is a part of the First Party." Refuting the petitioner's second contention, the respondent court declared that the "second agreement referred to the Construction and Service Agreement as its basis and specifically stated that it (was) merely a `part of the original agreement.'" 6 The concept of the solidary obligation requires a brief restatement.

DECISION

CRUZ, J p: May one of the two solidary creditors sue by himself alone for the recovery of amounts due to both of them without joining the other creditor as a co-plaintiff? In such a case, is the defendant entitled to the dismissal of the complaint on the ground of non-joinder of the second creditor as an indispensable party? More to the point, is the second solidary creditor an indispensable party? These questions were raised in the case at bar, with both the trial and respondent courts ruling in favor of the defendants. The petitioner is now before us, claiming that the said courts committed reversible error and misread the applicable laws in dismissing his complaint. This case stemmed from a "Construction and Service Agreement" 1 concluded on August 30, 1983, whereby Nicencio Tan Quiombing and Dante Biscocho, as the First Party, jointly and severally bound themselves to construct a house for private respondents Francisco and Manuelita Saligo, as the Second Party, for the contract price of P137,940.00, which the latter agreed to pay. On October 10, 1984, Quiombing and Manuelita Saligo entered into a second written agreement 2 under which the latter acknowledged the completion of the house and undertook to pay the balance of the contract price in the manner prescribed in the said second agreement. On November 19, 1984, Manuelita Saligo signed a promissory note for P125,363.50 representing the amount still due from her and her husband, payable on or before December 31, 1984, to Nicencio Tan Quiombing. 3 On October 9, 1986, Quiombing filed a complaint for recovery of the said amount, plus charges and interests, which the private respondents had acknowledged and promised to pay but had not, despite repeated demands as the balance of the contract price for the construction of their house. 4 Instead of filing an answer, the defendants moved to dismiss the complaint on February 4, 1987, contending that Biscocho was an indispensable party and therefore should have been included as a co-plaintiff. The motion was initially denied but was subsequently reconsidered and granted by the trial court. The complaint was dismissed, but without prejudice to the filing of an amended complaint to include the other solidary creditor as a co-plaintiff. 5 Rather than file the amended complaint, Quiombing chose to appeal the order of dismissal to the respondent court, where he argued that as a solidary creditor he could act by himself alone in the enforcement of his claim against the private respondents. Moreover, the amounts due were payable only to him under the second agreement, where Biscocho was not mentioned at all. LexLib The respondent court sustained the trial court and held that it was not correct at that point to assume that Quiombing and Biscocho were solidary obligees only. It noted that as they had also assumed the reciprocal obligation of constructing the house, they should also be considered obligors of the private respondents under the

Distinguishing it from the joint obligation, Tolentino makes the following observations in his distinguished work on the Civil Code: A joint obligation is one in which each of the debtors is liable only for a proportionate part of the debt, and each creditor is entitled only to a proportionate part of the credit. A solidary obligation is one in which each debtor is liable for the entire obligation, and each creditor is entitled to demand the whole obligation. Hence, in the former, each creditor can recover only his share of the obligation, and each debtor can be made to pay only his part; whereas, in the latter, each creditor may enforce the entire obligation, and each debtor may be obliged to pay it in full. 7 The same work describes the concept of active solidarity thus: The essence of active solidarity consists in the authority of each creditor to claim and enforce the rights of all, with the resulting obligation of paying every one what belongs to him; there is no merger, much less a renunciation of rights, but only mutual representation. 8 It would follow from these observations that the question of who should sue the private respondents was a personal issue between Quiombing and Biscocho in which the spouses Saligo had no right to interfere. It did not matter who as between them filed the complaint because the private respondents were liable to either of the two as a solidary creditor for the full amount of the debt. Full satisfaction of a judgment obtained against them by Quiombing would discharge their obligation to Biscocho, and vice versa; hence, it was not necessary for both Quiombing and Biscocho to file the complaint. Inclusion of Biscocho as a co-plaintiff, when Quiombing was competent to sue by himself alone, would be a useless formality. LibLex Article 1212 of the Civil Code provides: Each one of the solidary creditors may do whatever may be useful to the others, but not anything which may be prejudice to the latter. Suing for the recovery of the contract price is certainly a useful act that Quiombing could do by himself alone. Parenthetically, it must be observed that the complaint having been filed by the petitioner, whatever amount is awarded against the debtor must be paid exclusively to him, pursuant to Article 1214. This provision states that "the debtor may pay any of the solidary creditors; but if any demand, judicial or extrajudicial, has been made by any one of them, payment should be made to him." If Quiombing eventually collects the amount due from the solidary debtors, Biscocho may later claim his share thereof, but that decision is for him alone to make. It will affect only the petitioner as the other solidary creditor and not the private respondents, who have absolutely nothing to do with this matter. As far as they are concerned,

payment of the judgment debt to the complainant will be considered payment to the other solidary creditor even if the latter was not a party to the suit. Regarding the possibility that the private respondents might plead breach of contract in their answer, we agree with the petitioner that it is premature to consider this conjecture for such it is at this stage. The possibility may seem remote, indeed, since they have actually acknowledged the completion of the house in the second agreement, where they also agreed to pay the balance of the contract price. At any rate, the allegation, if made and proved, could still be enforceable against the petitioner alone as one of the solidary debtors, subject to his right of recourse against Biscocho. The respondent court was correct in ruling that the second agreement, which was concluded alone by the petitioner with the private respondents, was based on the original Construction and Service Agreement. So too in fact was the promissory note later signed by Manuelita Saligo since it was for the amount owing on the construction cost. However, this matter is not really that important now in view of our conclusion that the complaint could have been filed alone by the petitioner. The rest of the pieces should easily fall into place. Section 7, Rule 3 of the Rules of Court mandates the inclusion of indispensable parties as follows: Sec. 7.Compulsory joinder of indispensable parties. Parties in interest without whom no final determination can be had of an action shall be joined either as plaintiffs or defendants. Indispensable parties are those with such an interest in the controversy that a final decree would necessarily affect their rights, so that the court cannot proceed without their presence. Necessary parties are those whose presence is necessary to adjudicate the whole controversy, but whose interests are so far separable that a final decree can be made in their absence without affecting them. 9 (Necessary parties are now called proper parties under the 1964 amendments of the Rules of Court.) 10 According to Justice Jose Y. Feria, "where the obligation of the parties is solidary, either one of the parties is indispensable, and the other is not even necessary (now proper) because complete relief may be obtained from either."11 We hold that, although he signed the original Construction and Service Agreement, Biscocho need not be included as a co-plaintiff in the complaint filed by the petitioner against the private respondents. Quiombing as solidary creditor can by himself alone enforce payment of the construction costs by the private respondents and as a solidary debtor may by himself alone be held liable for any possible breach of contract that may be proved by the private respondents. In either case, the participation of Biscocho is not at all necessary, much less indispensable. WHEREFORE, the petition is GRANTED. The decision of the respondent court dated March 27, 1990, is SET ASIDE, and the Regional Trial Court of Antipolo, Rizal, is directed to REINSTATE Civil Case No. 913-A. Costs against the private respondents. COMMISSIONER ANDREA D. DOMINGO, BUREAU OF IMMIGRATION , petitioner, vs. HERBERT MARKUS EMIL SCHEER, respondent.

CALLEJO, SR., J p: This is a petition for review under Rule 45 of the Rules of Court, as amended, of the Decision 1 of the Court of Appeals in CA-G.R. SP No. 71094 granting the respondent's petition for certiorari and prohibition annulling the order of arrest issued by the petitioner, and permanently enjoining her from deporting the respondent from the Philippines. Through its decision, the CA virtually reversed the Summary Deportation Order 2 of the Board of Commissioners (BOC) and its Omnibus Resolution 3 denying the respondent's Urgent Motion for Reconsideration of said Order, and enjoining the petitioner from deporting the respondent. The facts as culled from the records are as follows: Respondent Herbert Markus Emil Scheer, a native of Ochsenfurt, Germany, was a frequent visitor of the Philippines. On July 18, 1986, his application for permanent resident status was granted. 4 The Bureau of Immigration and Deportation (BID) issued in favor of the respondent Alien Certificate of Registration No. B-396907 dated September 16, 1987 5 and Immigration Certificate of Residence No. 256789 dated February 24, 1988. 6 The Commissioner stated that the granting of the petition would redound to the benefit of the Filipino people. 7 During his sojourn in the Philippines, the respondent married widowed Edith delos Reyes 8 with whom he had two daughters. They had a son, Herbert Scheer, Jr., but he passed away on November 13, 1995. 9 They resided in Puerto Princesa City, Palawan, where the respondent established and managed the Bavaria Restaurant. On May 21, 1991, he was appointed Confidential Agent by then NBI Director Alfredo S. Lim. 10 In a Letter dated June 29, 1995, Vice Consul Jutta Hippelein informed the Philippine Ambassador to Bonn, Germany, that the respondent had police records and financial liabilities in Germany. 11 The Department of Foreign Affairs received from the German Embassy in Manila Note Verbale No. 369/95 dated July 26, 1995, informing it that the respondent was wanted by the German Federal Police; that a warrant of arrest had been issued against him; and that the respondent will be served with an official document requesting him to turn over his German passport to the Embassy which was invalidated on July 2, 1995. 12 The Embassy requested the Department of Foreign Affairs to inform the competent Philippine authorities of the matter. The BOC thereafter issued a Summary Deportation Order dated September 27, 1997. The penultimate paragraph of the Order reads: WHEREFORE, the foregoing considered, the Board Commissioners hereby orders the following: 1.Cancellation of respondent's permanent residence visa; 2.Respondent's summary Philippines; and deportation and permanent exclusion from the

3.Inclusion of his name on the Bureau's Blacklist. PROVIDED, however that said summary deportation should be held in abeyance in case said alien has a pending final and executory criminal conviction where the imposed penalty is imprisonment, in which case, he has to serve first such imposed penalty, and/or has a pending criminal, civil or administrative action and a Hold Departure Order has been issued or that his presence in said action is indispensable. In such instances, the alien should remain in the custody of the Bureau until his turnover to the proper authorities in case he has to serve imprisonment or in case of pendency of civil or criminal administrative action, he shall remain in the custody of the Bureau until such time that his pending cases shall have been decided, terminated or settled, as the case may be, unless circumstances demand the immediate implementation of this summary deportation.

DECISION

xxx xxx xxx SO ORDERED. 13 In issuing the said order, the BOC relied on the correspondence from the German Vice Consul on its speculation that it was unlikely that the German Embassy will issue a new passport to the respondent; on the warrant of arrest issued by the District Court of Germany against the respondent for insurance fraud; and on the alleged illegal activities of the respondent in Palawan. 14 The BOC concluded that the respondent was not only an undocumented but an undesirable alien as well. When the respondent was apprised of the deportation order, he forthwith aired his side to then BID Commissioner Leandro T. Verceles. The Commissioner allowed the respondent to remain in the Philippines, giving the latter time to secure a clearance and a new passport from the German Embassy. 15 Then Presidential Assistant Teodorico K. Imperial wrote a Testimonial dated November 24, 1995, in behalf of the respondent addressed to Commissioner Verceles. Nonetheless, the respondent, through counsel, filed on December 5, 1995 an Urgent Motion for Reconsideration of the Summary Deportation Order of the BOC. 16 In his motion, the respondent alleged, inter alia, that: AcSHCD 1.The elementary rules of due process require notice and opportunity to be heard before a person can be lawfully deprived of his right (Ute Paterok vs. Bureau of Customs, 193 SCRA 132). In the instant case, although it is acknowledged that the Honorable Office may conduct summary deportation proceedings, respondent was not given notice and opportunity to be heard before said Summary Deportation Order was issued. Respondent's right to procedural due process was therefore violated. Consequently, the Summary Deportation Order is invalid. 2.In issuing, the Summary Deportation Order, this Honorable Office relied on Note Verbal No. 369/95 issued by the Embassy of the Federal Republic of Germany, Manila, notifying the Department of Foreign Affairs and this Honorable Office about the warrant of arrest against respondent for alleged illegal insurance fraud and illegal activities. However, a close scrutiny of said note verbal shows that nowhere therein does it state that respondent was involved in insurance fraud or in any kind of illegal activities in Germany or anywhere else in the world, such as in Palawan. Therefore, the main basis of the Summary Deportation Order is incompetent as evidence against respondent who is, like every Filipino, presumed to be innocent until his guilt is proven beyond reasonable doubt. 3.The power to deport alien is a police power measure necessary against undesirable alien whose presence in the country is injurious to the public good and domestic tranquility of the country (Board of Commissioner Commission on Immigration vs. De la Rosa, 197 SCRA 853). It is respectfully submitted that respondent is not an undesirable alien. He has stayed in the Philippines for more or less than (10) years. He has married a Filipina and has three (3) minor children. He has established his business in Palawan and he has no police record whatsoever. Respondent has considered the Philippines his second home and he has nowhere else to go back to in Germany. Under the circumstances and for humanitarian considerations, respondent is not an undesirable alien whose deportation is warranted. Likewise, the mere fact that his passport was not renewed by the German Embassy does not also automatically justify the deportation of respondent. 17 However, the BOC did not resolve the respondent's motion. The respondent was neither arrested nor deported. Meanwhile, on February 15, 1996, the District Court of Straubing rendered a Decision dismissing the criminal case against the respondent for physical injuries. 18 The German Embassy in Manila, thereafter, issued a temporary passport to the respondent.

In a Letter dated March 1, 1996, the respondent informed Commissioner Verceles that his passport had been renewed following the dismissal of the said criminal case. He reiterated his request for the cancellation of the Summary Deportation Order dated September 27, 1995 and the restoration of his permanent resident status. 19 Subsequently, on March 12, 1996, the German Embassy issued to the respondent a regular passport, to expire on March 11, 2006. The BOC still failed to resolve the respondent's Urgent Motion for Reconsideration. Commissioner Verceles did not respond to the respondent's March 1, 1996 Letter. The respondent remained in the Philippines and maintained his business in Palawan. On March 20, 1997, the Department of Labor and Employment approved his application for Alien Employment Registration Certificate as manager of the Bavaria Restaurant in Puerto Princesa City. In the meantime, petitioner Immigration Commissioner Andrea T. Domingo assumed office. She wrote the German Embassy and inquired if the respondent was wanted by the German police. On April 12, 2002, the German Embassy replied that the respondent was not so wanted. 20 At about midnight on June 6, 2002, Marine operatives and BID agents apprehended the respondent in his residence on orders of the petitioner. He was whisked to the BID Manila Office and there held in custody while awaiting his deportation. Despite entreaties from the respondent's wife 21 and his employees, the petitioner refused to release the respondent. 22 Shocked at the sudden turn of events, the respondent promptly communicated with his lawyer. The latter filed with the BID a motion for bail to secure the respondent's temporary liberty. On June 11, 2002, the respondent's counsel filed with the Court of Appeals a petition for certiorari, prohibition and mandamus with a prayer for temporary restraining order and writ of preliminary injunction, to enjoin the petitioner from proceeding with the respondent's deportation. 23 The respondent (petitioner therein) alleged, inter alia, that his arrest and detention were premature, unjust, wrongful, illegal and unconstitutional, effected without sufficient cause and without jurisdiction or with grave abuse of discretion. He asserted that there was no speedy remedy open to him in the ordinary course of law 24 and that his Urgent Motion for Reconsideration of the Summary Deportation Order of the BOC had not yet been resolved despite the lapse of more than six years. The respondent averred that he was a fully documented alien, a permanent resident and a law-abiding citizen. He, thus, prayed as follows:

PRAYER WHEREFORE, it is most respectfully prayed of this Honorable Court that: 1.Upon the filing of this Petition, this Honorable Court issue a Temporary Restraining Order to enjoin respondent Commissioner from enforcing any order to deport petitioner; 2.After due hearing, a writ of preliminary and mandatory injunction be correspondingly issued to maintain the status quo pending resolution of the Petition on the merits. 3.After hearing, judgment be rendered: a)Directing and mandating respondent Commissioner and the body she heads to resolve the Motion for Reconsideration filed in 1995, in his favor, and nullifying or suspending the implementation of any order, oral or written, she may have issued or issue to deport petitioner; and b)Making the injunction in petitioner's favor permanent.

Petitioner likewise prays for such other and further relief as may be deemed just and equitable in the premises, such as directing respondent, if Herbert Scheer is deported before the matter is heard on notice, to authorize his return. 25 The BOC ruled that its September 27, 1995 Order had become final and executory after the lapse of one year, citing our rulings in Sy vs. Vivo, 26 and Lou vs. Vivo. 27 The BOC also held that it was not competent to reverse the September 27, 1995 Order, citing our ruling in Immigration Commissioner vs. Fernandez. 28 It declared that the respondent may seek the waiver of his exclusion via deportation proceedings through the exceptions provided by Commonwealth Act No. 613,29 Section 29(a)(15), but that his application for the waiver presupposes his prior removal from the Philippines. In a parallel development, the respondent procured a letter from the National Bureau of Investigation (NBI) in Puerto Princesa City certifying that he had no pending criminal record. 30 The Puerto Princesa City Philippine National Police (PNP) also issued a certification that the respondent had no pending criminal or derogatory records in the said office. 31 Meanwhile, on June 26, 2002, the Court of Appeals issued a status quo order restraining the petitioner from deporting the respondent on a bond of P100,000.00. 32 On July 18, 2002, the BOC issued an Omnibus Resolution dated June 14, 2002, pendente lite denying the respondent's Urgent Motion for Reconsideration, Motion for Bail/Recognizance, and the Letter dated June 11, 2002. The decretal portion of the resolution reads: Wherefore, in view of the foregoing circumstances, we deny the prayers of the Urgent Motion for Reconsideration of 5 December 1995, the Motion for Bail/Recognizance dated 7 June 2002 and the Letter of 11 June 2002. Further, we hereby order the following: 1.Subject to the submission of appropriate clearances, the summary deportation order the respondent Herbert Scheer, German, under BI Office Memorandum Order No. 34 (series of 1989) and the BOC Summary Deportation Order of 27 September 1995; 2.Permanent exclusion of Herbert Scheer from the Philippines under C.A. No. 613, Section 40(a)(15). 3.Inclusion of the name of Herbert Scheer in the Immigration Black List; and 4.Forfeiture of the bail bond, if any, of Herbert Scheer under C.A. No. 613, Section 40(a)(15). xxx xxx xxx IT IS SO ORDERED. 33 During the hearing of the respondent's plea for a writ of preliminary mandatory injunction before the CA on July 22, 2002, the Office of the Solicitor General (OSG) manifested that the State had no opposition to the respondent's reentry and stay in the Philippines, provided that he leave the country first and re-apply for admission and residency status with the assurance that he would be re-admitted. 34 The respondent's counsel manifested to the appellate court that he had just been informed by the OSG of the Omnibus Resolution of the BOC dated June 14, 2002. In her Comment on the Petition, the petitioner (the respondent therein) alleged, inter alia, the following: 1)that the BOC was an indispensable party to the petition; EaIDAT

2)the petitioner's failure to implead the BOC warranted the denial of the petition; 3)the allowance by then Immigration Commissioner Leandro Verceles for the petitioner therein to renew his passport and secure clearances, even if proved, was not binding on the BOC; 4)the September 27, 1995 Order of the BOC was already executory when the respondent filed her petition in the CA; 5)the German Embassy's issuance of a new passport did not legalize the respondent's stay in this country, which became illegal on July 2, 1995 when his passport expired; 6)the respondent therein did not act with abuse of discretion in causing the arrest and detention of the respondent based on the BOC's Summary Deportation Order; and 7)the BOC did not act with grave abuse of discretion in issuing its Summary Deportation Order and Omnibus Resolution and such order and resolution were not mooted by the German Embassy's issuance of a new passport in favor of the respondent. In view of the Omnibus Resolution of the BOC, the respondent (petitioner therein) in his Memorandum prayed for the nullification of the BOC's Order, as well as its Omnibus Resolution denying his Urgent Motion for Reconsideration considering that with the issuance of a new passport, there was no more basis for his deportation, thus: RELIEF WHEREFORE, it is most respectfully prayed of this Honorable Court that: 1.Upon the filing of this Memorandum, this Honorable Court forthwith direct and authorize the immediate release of petitioner, even on undersigned's recognizance, until further orders from this Honorable Court; 2.The Summary Deportation Order of September 27, 19[9]5, affirmed by respondent allegedly on June 14, 2002 and made known only yesterday, be nullified to the extent that it directs the deportation of petitioner, who has removed the very basis of said Order of not having a valid passport, and that the Resolution of June 14, 2002 be nullified in toto; and, 3.The Temporary Restraining Order of June 26, 2002 be converted into a permanent injunction or writ of prohibition. Petitioner likewise prays for such other and further relief as may be deemed just and equitable in the premises.35 Surprisingly, the respondent's counsel received on July 24, 2003 a Letter from the petitioner dated July 16, 2002 stating that, "the BOC was in the course of reviewing the deportation case against Mr. Scheer, and that its findings would be given in due time." 36 On August 20, 2002, the Court of Appeals rendered a Decision in favor of the respondent granting his petition forcertiorari and prohibition and permanently enjoining the petitioner from deporting the respondent. The decretal portion of the Decision reads:

WHEREFORE, premises considered, the petitions for certiorari and prohibition are hereby GRANTED. Accordingly, any order, oral or written, issued by respondent Commissioner Domingo against petitioner, in relation to his deportation, is hereby ANNULLED, and respondent Commissioner Domingo is hereby permanently enjoined/prohibited from deporting petitioner, in so far as this case is concerned. It is likewise ordered that petitioner be released from his confinement/detention in the Bureau of Immigration UNLESS there is/are fresh new grounds/cases that will warrant his continued detention. SO ORDERED. 37 The Court of Appeals ruled that the German Embassy's subsequent issuance of passport to the respondent before the BOC's issuance of its Omnibus Resolution had mooted the September 27, 1995 Summary Deportation Order, as well as the arrest and detention of the respondent. According to the court, it made no sense to require the respondent to leave the country and thereafter re-apply for admission with the BOC. Furthermore, since the grounds cited by the BOC in its Summary Deportation Order no longer existed, there was no factual and legal basis to disqualify the respondent from staying in the country. On the issue of whether the members of the BOC were indispensable parties, the CA ruled as follows: a)There are quite a number of cases in relevant jurisprudence wherein only the Immigration Commissioner was impleaded to decide whether an alien may stay or be deported, such as in the case of Vivo vs. Arca (19 SCRA 878) and Vivo vs. Cloribel (22 SCRA 159). b)In the case of Caruncho III vs. COMELEC (315 SCRA 693), it was pronounced that: "Ordinarily, the nonjoinder of an indispensable party or the real party interest is not by itself a ground for the dismissal of the petition. The court before which the petition is filed must first require the joinder of such party. It is the noncompliance with said order that would be a ground for the dismissal of the petition." thus, c) respondent may be estopped for not raising such issue earlier. 38 Aggrieved, the respondent therein, now the petitioner, through the Office of the Solicitor General, appealed to us for relief. The petitioner contends that the Court of Appeals erred on a question of law in granting the respondent's petition in CA-G.R. SP No. 71094. 39 In support of his contention, the Solicitor General has submitted the following arguments: I.THE WRIT OF MANDAMUS DOES NOT LIE AGAINST THE COMMISSIONER OF THE BUREAU OF IMMIGRATION TO RESOLVE RESPONDENT'S URGENT MOTION FOR RECONSIDERATION OF THE SUMMARY DEPORTATION ORDER, CONSIDERING THAT IT IS THE BOARD OF COMMISSIONERS, AND NOT THE COMMISSIONER ALONE, WHICH HAS AUTHORITY TO MAKE SAID RESOLUTION. II.THE WRIT OF CERTIORARI DOES NOT LIE AGAINST THE COMMISSIONER OF THE BUREAU OF IMMIGRATION, CONSIDERING THAT IT IS THE BOARD OF COMMISSIONERS, AND NOT THE COMMISSIONER ALONE, WHICH ISSUED THE SUMMARY DEPORTATION ORDER AND THE OMNIBUS RESOLUTION.

III.THE WRIT OF PROHIBITION DOES NOT LIE AGAINST THE COMMISSIONER OF THE BUREAU OF IMMIGRATION, PROHIBITING THE IMPLEMENTATION OF THE SUMMARY DEPORTATION ORDER AND THE OMNIBUS RESOLUTION, CONSIDERING THAT THE BOARD OF COMMISSIONERS WAS NOT IMPLEADED AS PARTY-RESPONDENT IN THE PETITION IN CA-G.R. SP NO. 71094.

IV.ASSUMING BUT WITHOUT ADMITTING THAT THE BOARD OF COMMISSIONERS WAS PROPERLY IMPLEADED AS PARTY-RESPONDENT IN THE PETITION IN CA-G.R. SP NO. 71094, NEVERTHELESS, THE SUMMARY DEPORTATION ORDER AND THE OMNIBUS RESOLUTION WERE NOT ISSUED WITHOUT OR IN EXCESS OF JURISDICTION OR WITH GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF (SIC) EXCESS OF JURISDICTION. ATcaID V.FURTHER ASSUMING BUT WITHOUT ADMITTING THAT THE BOARD OF COMMISSIONERS WAS PROPERLY IMPLEADED AS PARTY-RESPONDENT IN THE PETITION IN CA-G.R. SP NO. 71094, THE COMMISSIONER OF THE BUREAU OF IMMIGRATION DID NOT ACT WITHOUT OR IN EXCESS OF JURISDICTION OR WITH GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION IN IMPLEMENTING THE SUMMARY DEPORTATION ORDER AND THE OMNIBUS RESOLUTION. 40 Elucidating on his first three arguments, the petitioner maintains that the respondent's petition for certiorari, prohibition and mandamus before the Court of Appeals should have been dismissed because he failed to implead the real party-in-interest as mandated by Rule 3, Section 7 of the Rules of Court, as amended; in this case, the BOC. According to the Solicitor General, this was a fatal procedural error. The inclusion of the BOC as respondent in the case was necessary in order that its actions could be directly attacked and for the court to acquire jurisdiction over it. The fact that Immigration Commissioner Andrea T. Domingo was impleaded as the sole respondent was not enough, as she is only one of the four Commissioners. Furthermore, the assailed Orders were issued by the Board, and not by the Immigration Commissioner alone. The respondent counters that the petitioner is already estopped from raising this issue. He argues that In quite a number of jurisprudence, only the Immigration Commissioner is impleaded to decide whether an alien may stay here or not. The bottom line is petitioner, head of the Bureau of Immigration, was more than fully heard on its institutional position, a Bureau which speaks with a single voice in this case. She is in estoppel for not raising the issue earlier, either in a timely Comment or during the oral argument . . . 41 In Caruncho III v. Comelec, it was held that [O]rdinarily, the nonjoinder of an indispensable party or real party in interest is not by itself a ground for the dismissal of the petition. The court before which the petition is filed must first require the joinder of such party. It is the noncompliance with said order that would be a ground for the dismissal of the petition. But even as the Court of Appeals did not require respondent of such joinder of parties, the respondent, in fact, begged leave, ad cautelam, in its Reply Memorandum dated July 31, 2002 to implead the Board which speaks with a single voice anyway in this case, and therefore, no claim can be made that a valid point of view has not been heard . . . 42

Moreover, according to the respondent, the petitioner is clearly the BID's chosen instrumentality for the relevant purpose. What the respondent ultimately questioned are the acts or orders of the petitioner for the arrest and immediate deportation of the respondent by way of implementing the BOC's Summary Deportation Order. By way of reply, the Office of the Solicitor General asserted that the Summary Deportation Order and Omnibus Resolution were collegial actions of the BOC and not of the petitioner alone. Although its Chairperson, the petitioner, is merely a member thereof, her decisions and actions are still subject to the collective will of the majority. 43

BOC, 57 was the respondent in the CA, and the petitioner in the instant recourse. In Alonso v. Villamor, 58 we had the occasion to state: There is nothing sacred about processes or pleadings, their forms or contents. Their sole purpose is to facilitate the application of justice to the rival claims of contending parties. They were created, not to hinder and delay, but to facilitate and promote, the administration of justice. They do not constitute the thing itself, which courts are always striving to secure to litigants. They are designed as the means best adapted to obtain that thing. In other words, they are a means to an end. When they lose the character of the one and become the other, the administration of justice is at fault and courts are correspondingly remiss in the performance of their obvious duty.

The Ruling of the Court The BOC is an Indispensable Party

We agree with the petitioner's contention that the BOC was an indispensable party to the respondent's petition forcertiorari, prohibition and mandamus in the Court of Appeals. The respondent was arrested and detained on the basis of the Summary Deportation Order of the BOC. The petitioner caused the arrest of the respondent in obedience to the said Deportation Order. The respondent, in his Memorandum, prayed that the CA annul not only the Summary Deportation Order of the BOC but also the latter's Omnibus Resolution, and, thus, order the respondent's immediate release. The respondent also prayed that the CA issue a writ of mandamus for the immediate resolution of his Urgent Motion for Reconsideration. The said motion had to be resolved by the BOC as the order sought to be resolved and reconsidered was issued by it and not by the petitioner alone. The powers and duties of the BOC may not be exercised by the individual members of the Commission. 44 Section 7, Rule 3 of the Rules of Court, as amended, requires indispensable parties to be joined as plaintiffs or defendants. The joinder of indispensable parties is mandatory. Without the presence of indispensable parties to the suit, the judgment of the court cannot attain real finality. 45 Strangers to a case are not bound by the judgment rendered by the court. 46 The absence of an indispensable party renders all subsequent actions of the court null and void. Lack of authority to act not only of the absent party but also as to those present. 47 The responsibility of impleading all the indispensable parties rests on the petitioner/plaintiff. 48 However, the non-joinder of indispensable parties is not a ground for the dismissal of an action. Parties may be added by order of the court on motion of the party or on its own initiative at any stage of the action and/or such times as are just.49 If the petitioner/plaintiff refuses to implead an indispensable party despite the order of the court, the latter may dismiss the complaint/petition for the petitioner/plaintiffs failure to comply therefor. 50 The remedy is to implead the non-party claimed to be indispensable. 51 In this case, the CA did not require the respondent (petitioner therein) to implead the BOC as respondent, but merely relied on the rulings of the Court in Vivo v. Arca, 52 and Vivo v. Cloribel. 53The CA's reliance on the said rulings is, however, misplaced. The acts subject of the petition in the two cases were those of the Immigration Commissioner and not those of the BOC; hence, the BOC was not a necessary nor even an indispensable party in the aforecited cases.

The CA had for Certiorari, Prohibition and Mandamus

Jurisdiction

Over

the

Petition

We do not agree with the petitioner's contention that the issue before the CA, as to the power of the President to determine whether an alien may remain or be deported from the Philippines, is beyond the appellate court's competence to delve into and resolve. The contention of the petitioner is based on a wrong premise. The settled rule is that the authority to exclude or expel aliens by a power affecting international relation is vested in the political department of the government, and is to be regulated by treaty or by an act of Congress, and to be executed by the executive authority according to the regulations so established, except in so far as the judicial department has been authorized by treaty or by statute, or is required by the Constitution to intervene. 59 The judicial department cannot properly express an opinion upon the wisdom or the justice of the measures executed by Congress in the exercise of the power conferred on it, 60 by statute or as required by the Constitution. Congress may, by statute, allow the decision or order of the Immigration Commissioner or the BOC to be reviewed by the President of the Philippines or by the courts, on the grounds and in the manner prescribed by law. Article VIII, Section 1 of the Constitution has vested judicial power in the Supreme Court and the lower courts such as the Court of Appeals, as established by law. Although the courts are without power to directly decide matters over which full discretionary authority has been delegated to the legislative or executive branch of the government and are not empowered to execute absolutely their own judgment from that of Congress or of the President, 61 the Court may look into and resolve questions of whether or not such judgment has been made with grave abuse of discretion, when the act of the legislative or executive department violates the law or the Constitution. In Harvy Bridges v. I.F. Wixon, 62the United States Federal Supreme Court reversed an Order of Deportation made by the Attorney General for insufficiency of evidence and for "improper admission of evidence." In Nging v. Nagh, 63 the United States Court of Appeals (9th Circuit Court) held that conclusions of administrative offices on the issues of facts are invulnerable in courts unless when they are not rendered by fair-minded men; hence, are arbitrary. In Toon v. Stump, 64 the Court ruled that courts may supervise the actions of the administrative offices authorized to deport aliens and reverse their rulings when there is no evidence to sustain them. When acts or omissions of a quasi-judicial agency are involved, a petition forcertiorari or prohibition may be filed in the Court of Appeals as provided by law or by the Rules of Court, as amended. 65

The Non-joinder of is not a Ground for the Dismissal of the Petition

an

Indispensable

Party

The Court may be curing the defect in this case by adding the BOC as party-petitioner. The petition should not be dismissed because the second action would only be a repetition of the first. 54 In Salvador, et al., v. Court of Appeals, et al., 55 we held that this Court has full powers, apart from that power and authority which is inherent, to amend the processes, pleadings, proceedings and decisions by substituting as party-plaintiff the real party-ininterest. The Court has the power to avoid delay in the disposition of this case, to order its amendment as to implead the BOC as party-respondent. Indeed, it may no longer be necessary to do so taking into account the unique backdrop in this case, involving as it does an issue of public interest. 56 After all, the Office of the Solicitor General has represented the petitioner in the instant proceedings, as well as in the appellate court, and maintained the validity of the deportation order and of the BOC's Omnibus Resolution. It cannot, thus, be claimed by the State that the BOC was not afforded its day in court, simply because only the petitioner, the Chairperson of the

In this case, the respondent alleges that the petitioner acted arbitrarily, contrary to law and with grave abuse of discretion in causing his arrest and detention at a time when his Urgent Motion for Reconsideration of the BOC's Summary Deportation Order had yet to be resolved. There was no factual or legal basis for his deportation considering that he was a documented alien and a law-abiding citizen; the respondent, thus, prayed for a writ of mandamus to compel the petitioner, the Chairperson of the BOC, to resolve the said motion. The petition before the CA did not involve the act or power of the President of the Philippines to deport or exclude an alien from the

country. This being so, the petition necessarily did not call for a substitution of the President's discretion on the matter of the deportation of the respondent with that of the judgment of the CA. Irrefragably, the CA had jurisdiction over the petition of the respondent. DHACES

activities in the Philippines and would not, thus, be issued a new passport. This, in turn, caused the BOC to conclude that the respondent was an undesirable alien. Section 37(c) of Commonwealth Act No. 613, as amended, provides that: No alien shall be deported without being informed of the specific grounds for deportation or without being given a hearing under rules of procedure to be prescribed by the Commissioner of Immigration. Under paragraphs 4 and 5 of Office Memorandum Order No. 34, an alien cannot be deported unless he is given a chance to be heard in a full deportation hearing, with the right to adduce evidence in his behalf, thus: 4.All other cases shall be tried in full deportation hearing, with due observance of the pertinent provisions of Law Instruction No. 39. 5.In all cases, the right of the alien to be informed of the charges against him, to be notified of the time and place of hearing, when necessary, to examine the evidence against him, and to present evidence in his own behalf, where appropriate, shall be observed. The respondent was not afforded any hearing at all. The BOC simply concluded that the respondent committed insurance fraud and illegal activities in Palawan without any evidence. The respondent was not afforded a chance to refute the charges. He cannot, thus, be arrested and deported without due process of law as required by the Bill of Rights of the Constitution. In Lao Gi v. Court of Appeals, 67 we held that: Although a deportation proceeding does not partake of the nature of a criminal action, however, considering that it is a harsh and extraordinary administrative proceeding affecting the freedom and liberty of a person, the constitutional right of such person to due process should not be denied. Thus, the provisions of the Rules of Court of the Philippines particularly on criminal procedure are applicable to deportation proceedings. It must be noted that the respondent was a permanent resident before his passport expired on July 2, 1995. In Chew v.Colding, 68 the United States Federal Supreme Court ruled: It is well established that if an alien is a lawful permanent resident of the United States and remains physically present there, he is a person within the protection of the Fifth Amendment. He may not be deprived of his life, liberty or property without due process of law. Although it later may be established, as respondents contend, that petitioner can be expelled and deported, yet before his expulsion, he is entitled to notice of the nature of the charge and a hearing at least before an executive or administrative tribunal. Although Congress may prescribe conditions for his expulsion and deportation, not even Congress may expel him without allowing him a fair opportunity to be heard. As Mr. Justice Murphy said in his concurring opinion in Bridges v. Wixon: 69

The BOC Committed Amounting to Lack in Issuing its and Omnibus Committed a Grave Amounting to Lack in Causing the of the Private Respondent

Grave Abuse of or Excess of Summary Deportation Resolution; The Abuse of Her or Excess of Arrest and

Discretion Jurisdiction Order Petitioner Discretion Jurisdiction Detention

On the Solicitor General's fourth and fifth arguments, we are convinced that the BOC committed a grave abuse of discretion amounting to excess or lack of jurisdiction in issuing its Summary Deportation Order and Omnibus Resolution, and that the petitioner committed grave abuse of discretion amounting to excess or lack of jurisdiction in causing the arrest and detention of the private respondent. The settled rule is that the entry or stay of aliens in the Philippines is merely a privilege and a matter of grace; such privilege is not absolute nor permanent and may be revoked. However, aliens may be expelled or deported from the Philippines only on grounds and in the manner provided for by the Constitution, the Immigration. Act of 1940, as amended, and administrative issuances pursuant thereto. In Mejoff v. Director of Prisons, 66 we held, thus: Moreover, by its Constitution (Art. II, Sec. 3) the Philippines "adopts the generally accepted principles of international law a part of the law of Nation." And in a resolution entitled "Universal Declaration of Human Rights" and approved by the General Assembly of the United Nations of which the Philippines is a member, at its plenary meeting on December 10, 1948, the right to life and liberty and all other fundamental rights as applied to all human beings were proclaimed. It was there resolved that "All human beings are born free and equal in degree and rights" (Art. 1); that "Everyone is entitled to all the rights and freedom set forth in this Declaration, without distinction of any kind, such as race, color, sex, language, religion, political or other opinion, nationality or social origin, property, birth, or other status" (Art. 2); that "Every one has the right to an effective remedy by the competent national tribunals for acts violating the fundamental rights granted him by the Constitution or by law" (Art. 8); that "No one shall be subjected to arbitrary arrest, detention or exile" (Art. 9); etc. In this case, the BOC ordered the private respondent's deportation on September 27, 1995 without even conducting summary deportation proceedings. The BOC merely relied on the June 29, 1995 Letter of the German Vice Consul and of the German Embassy's Note Verbale No. 369/95 dated July 26, 1995. It issued the Summary Deportation Order on September 27, 1995 allegedly under paragraph 3 of Office Memorandum Order No. 34 dated August 21, 1989 which reads: 3.If a foreign embassy cancels the passport of the alien or does not reissue a valid passport to him, the alien loses the privilege to remain in the country, under the Immigration Act, Sections 10 and 15 (Schonemann vs. Santiago, et al., G.R. No. 81461, 30 May 1989). The automatic loss of the privilege obviates deportation proceedings. In such instance, the Board of Commissioners may issue summary judgment of deportation which shall be immediately executory. However, as gleaned from the Summary Deportation Order, the respondent was ordered deported not only because his passport had already expired; the BOC speculated that the respondent committed insurance fraud and illegal

The Bill of Rights belongs to them as well as to all citizens. It protects them as long as they reside within the boundaries of our land. It. protects them in the exercise of the great individual rights necessary to a sound political and economic democracy. According to Vattal, 70 an alien who is a permanent resident in a country is a member of the new society, at least as a permanent inhabitant, and is a kind of citizen of inferior order from the native citizens; but is, nevertheless,

limited and subject to the society, without participating in all its advantages. Sir Robert Philconse called them "de facto," though notde jure citizens of the country of their domicile. 71 Such permanent resident 72 may be classified as a "denizen," a kind of middle state between alien and a naturalborn subject and partakes of both. Paraphrasing Justice Brewer in his dissenting opinion in Fong Yue Ting v. United States, 73when the right to liberty and residence is involved, some other protection than the mere discretion of the petitioner or the BOC is required. We recall the warning of the United States Supreme Court in Boyd v. United States: 74 Illegitimate and unconstitutional practices get their first footing in that way, namely, by silent approaches and slight deviations from legal modes of procedure. This can only be obviated by adhering to the rule that constitutional provisions for the security of person and property should be liberally construed. A close and literal construction deprives them of half their efficacy, and leads to a gradual depreciation of the right, as if it consisted more in sound than in substance. It is the duty of the courts to be watchful for the constitutional rights of the citizen, and against any stealthy encroachments thereon. Their motto should be obsta principiis.EScAID In sum, the arrest and detention of the respondent and his deportation under the Summary Deportation Order of the BOC for insurance fraud and illegal activities in Palawan violated his constitutional and statutory rights to due process.

police for any crime, including insurance fraud. This could only mean that the warrant of arrest issued by the German Federal police mentioned in Note Verbale No. 369/95 had been lifted, and that the respondent was not involved in any illegal activities in Germany. The criminal case against the respondent for physical injuries, which does not involve moral turpitude, was dismissed by the German District Court. Furthermore, there was no evidence of insurance fraud against the respondent. The BOC issued its Summary Deportation Order without affording the respondent the right to be heard on his motion and adduce evidence thereon. It merely concluded that the respondent was involved in "illegal activities in Palawan." What made matters worse was that the BOC indulged in sheer speculation, that the German Embassy is unlikely to issue a new passport to the respondent. The deportation of aliens should not be based on mere speculation or a mere product of procrastinations as in this case. As it turned out, the German Embassy re-issued the respondent's passport; he was issued a temporary passport, and, thereafter, a regular passport, yet to expire on March 12, 2006. The petitioner cannot feign ignorance of this matter because the respondent himself, six years before he was arrested, informed then Immigration Commissioner Verceles in a Letter dated March 1, 1996. The respondent's letter forms part of the records of the BOC. There is no evidence on record that the respondent committed any illegal activities in Palawan. He was even designated as special agent of the NBI, and was, in fact, issued clearances by the PNP and the NBI no less. Despite all the foregoing, the petitioner ordered and caused the arrest and detention of the respondent. What is most nettlesome is the apparent antedating of the BOC Omnibus Resolution. The records show that the petitioner sought to assuage the respondent's concern on the belated resolution of his pending urgent motion for reconsideration in a Letter to the latter's counsel dated July 18, 2002 in which the petitioner assured the respondent that the BOC will provide him of its action on the said motion: Dear Atty. Sagisag, We respond to your letter of 17 June 2002 by informing you that the case of Mr. Herbert Scheer is being evaluated by the Board of Commissioners (BOC). The BOC will provide you of the results of its collegial action in due time. Very truly yours, (Sgd.) ANDREA D. DOMINGO Commissioner 75

The Detention Unwarranted and Arbitrary

Respondent's

was

Arrest

and Premature,

We agree that the Immigration Commissioner is mandated to implement a legal and valid Summary Deportation Order within a reasonable time. But in this case, the arrest of the respondent in his house, at near midnight, and his subsequent detention was premature, unwarranted and arbitrary. Like a thunderbolt in the sky, the BID agents and marines arrested the respondent on June 6, 2002, on orders of the petitioner based on the September 27, 1995 Summary Deportation Order. Under the basic rudiments of fair play and due process, the petitioner was required to first resolve the respondent's Urgent Motion for Reconsideration of the said Order, which was filed more than six years before or on December 5, 1995.

It may be argued that respondent's filing of an Urgent Motion for Reconsideration did not ipso facto suspend the efficacy of the BOC's deportation order. However, such an argument cannot be sustained in this case because of the extant and peculiar factual milieu. It bears stressing that more than six years had elapsed, from the time the Summary Deportation Order was issued, until the respondent was finally arrested. Supervening facts and circumstances rendered the respondent's arrest and detention unjust, unreasonable, barren of factual and legal basis. The BOC should have set the respondent's motion for hearing to afford him a chance to be heard and adduce evidence in support thereon. It was bad enough that the BOC issued its Summary Deportation Order without a hearing; the BOC dealt the respondent a more severe blow when it refused to resolve his motion for reconsideration before causing his arrest on June 6, 2002. As aforestated, the BOC ordered the deportation of the respondent after a summary proceeding without prior notice on the following grounds: (a) the respondent's German passport had expired; (b) there was a pending criminal case for physical injuries against him in Germany; (c) the respondent indulged in illegal activities in Palawan; (d) that in all likelihood, the respondent's passport will not be renewed by the German Embassy as he was wanted for insurance fraud in Germany; and, (e) he was an undesirable alien. But then, in response to the written query of no less than the petitioner herself, the German Embassy declared that the respondent was not wanted by the German

However, the Omnibus Resolution of the BOC was dated June 14, 2002, although on its face it was filed with the Records Division of the BID only on July 18, 2002. The foregoing gave reason for the CA to suspect that the Omnibus Resolution of the BOC was antedated. 76 The petition of the respondent in the CA must have jolted the petitioner and the BOC from its stupor because it came out with its Omnibus Resolution on July 18, 2002, which was, however, dated as early as June 14, 2002. The respondent had to wait in anxiety for the BOC to quench his quest for justice. The BOC's wanton acts amounted to an abdication of its duty to act and/or resolve cases/incidents with reasonable dispatch. To recall our ruling in Board of Commissioners v. De la Rosa, 77 citing Sheor v. Bengson, 78 thus: This inaction or oversight on the part of the immigration officials has created an anomalous situation which, for reasons of equity, should be resolved in favor of the minor herein involved.

The petitioner and the BOC should have taken to heart the following pronouncement in Commissioner of Immigration v.Fernandez: 79 In the face of the disclosure that Teban Caoili had been all along working in the Avenue Electrical Supply Co. (Avesco), located at No. 653 Rizal Avenue, Manila, until his arrest, and the documentary evidence showing that he had been issued a Philippine Passport; had regularly paid his Residence Tax Certificates (A & B), and filed Income Tax Returns, a finding of fact is necessary whether the Commissioner really had intended to notify Teban Caoili of the exclusion proceedings the Board had conducted in his absence. While it may be true that the proceedings is purely administrative in nature, such a circumstance did not excuse the serving of notice. There are cardinal primary rights which must be respected even in proceedings of administrative character, the first of which is the right of the party interested or affected to present his own case and submit evidence in support thereof. 80 xxx xxx xxx Since the proceedings affected Caoili's status and liberty, notice should have been given. And in the light of the actuations of the new Board of Commissioners, there is a necessity of determining whether the findings of the Board of Special Inquiry and the old Board of Commissioners are correct or not. This calls for an examination of the evidence, and, the law on the matter. 81 Apparently, the BOC did not bother to review its own records in resolving the respondent's Urgent Motion for Reconsideration. It anchored its Omnibus Resolution only on the following: the membership of the BOC had changed when it issued its September 27, 1995 Summary Deportation Order and under Commonwealth Act No. 613, Section 27(b); the BOC is precluded from reversing a previous order issued by it; 82 and, the September 27, 1995 Order of the BOC had become final and could no longer be reviewed and reversed by it after the lapse of one year. 83 However, the rulings cited by the petitioner are not applicable in the instant case, as the said cases cited involve appeals to the BOC from the decisions of the Board of Special Inquiry (BSI). In Sy v. Vivo 84 and Lou v. Vivo, 85 we ruled that under Section 27(b) of Commonwealth Act No. 613, as amended, the Decision of the BOC on appeal from the decision of the BSI becomes final and executory after one year: (b)A board of special inquiry shall have authority (1) to determine whether an alien seeking to enter or land in the Philippines shall be allowed to enter or land or shall be excluded, and (2) to make its findings and recommendations in all the cases provided for in section twenty-nine of this Act wherein the Commissioner of Immigration may admit an alien who is otherwise inadmissible. For this purpose, the board or any member thereof, may administer oaths and take evidence and in case of necessity may issue subpoena and/or subpoenaduces tecum. The hearing of all cases brought before a board of special inquiry shall be conducted under rules of procedure to be prescribed by the Commissioner of Immigration. The decision of any two members of the board shall prevail and shall be final unless reversed on appeal by the Board of Commissioners as hereafter stated, or in the absence of an appeal, unless reversed by the Board of Commissioners after a review by it,motu propio, of the entire proceedings within one year from the promulgation of the decision. EDCcaS In Commissioner of Immigration v. Fernandez, 86 we held that the BOC composed of new members is precluded from reversing, motu proprio, the decision of the BOC on appeal from a BSI decision. But not to be ignored was our ruling that "at any rate, the issue of authority should be made in accordance with the procedure established by law, with a view to protecting the rights of individuals." 87 In this case, the Summary Deportation Order was issued by the BOC in the exercise of its authority under Office Memorandum Order No. 34, and not in the exercise of its appellate jurisdiction of BSI decisions. There is no law nor

rule which provides that a Summary Deportation Order issued by the BOC in the exercise of its authority becomes final after one year from its issuance, 88 or that the aggrieved party is barred from filing a motion for a reconsideration of any order or decision of the BOC. The Rules of Court may be applied in a suppletory manner to deportation proceedings 89 and under Rule 37, a motion for reconsideration of a decision or final order may be filed by the aggrieved party. Neither is there any law nor rule providing that the BOC, composed of new members, cannot revise a Summary Deportation Order previously issued by a different body of Commissioners. The BOC that issued the Summary Deportation Order and the BOC which resolved the respondent's Urgent Motion for Reconsideration are one and the same government entity, with the same powers and duties regardless of its membership. Similarly, an RTC judge who replaces another judge who presided over a case may review the judgment or order of his predecessor as long as the said judgment or order has not as yet become final or executory, The act subject of review is not the act of the judge but the act of the court.

The petitioner's contention that it failed to resolve the respondent's motion for reconsideration because of the change of administration in the BOC was branded by the CA as flimsy, if not bordering on the absurd: Firstly, it was issued three days (June 14, 2002) after petitioner filed this instant petition on June 11, 2002 or almost seven years from the time the motion for reconsideration was filed; Secondly, respondent's counsel's excuse that it took such time to resolve it because it was only later that the motion for reconsideration was discovered because of change of administration, is flimsy, if not bordering on the absurd; 90

The Passport Rendered Deportation Academic, Resolution in Legal Basis

Issuance

of to Order and

a the the

New the the Moot BOC

and

of

Regular Respondent Summary and Omnibus Lacking

We agree with the petitioner that a foreign embassy's cancellation of the passport it had issued to its citizens, or its refusal to issue a new one in lieu of a passport that has expired, will result in the loss of the alien's privilege to stay in this country and his subsequent deportation therefrom. But even the BOC asserted in its Summary Deportation Order that an embassy's issuance of a new passport to any of its citizens may bar the latter's deportation, citing the resolution of this Court in Schonemann v. Commissioner Santiago. 91 Irrefragably, Commissioner Verceles was mandated to cause the arrest of the respondent preparatory to his deportation from the Philippines. However, there was no fixed period in the Order within which to comply with the same. The Commissioner is not mandated to deport an alien immediately upon receipt of the BOC's deportation order. It is enough that the Commissioner complies with the Order within a "reasonable time," which, in Mejoff v. Director of Prisons, 92 we held to connote as follows: The meaning of "reasonable time" depends upon the circumstances, specially the difficulties of obtaining a passport, the availability of transportation, the diplomatic arrangements with the governments concerned and the efforts displayed to send the deportee away; but the Court warned that "under established precedents, too long a detention may justify the issuance of a writ of habeas corpus.

In this case, the BOC had yet to act on the respondent's Urgent Motion for Reconsideration. The respondent was also given a chance to secure a clearance and a new passport with the German Embassy. After all, the possibility that the German Embassy would renew the respondent's passport could not be ruled out. This was exactly what happened: the German Embassy issued a new passport to the respondent on March 12, 1996 after the German District Court dismissed the case for physical injuries. Thus, the respondent was no longer an undocumented alien; nor was he an undesirable one for that matter. The petitioner even admits that there is no longer a legal or factual basis to disqualify the respondent from remaining in the country as a permanent resident. Yet, the OSG insists that he has to be deported first so that the BOC's Summary Deportation Order could be implemented. This contention was rejected by the CA, thus: During the hearing of petitioner's prayer for issuance of a writ of preliminary injunction before Us, respondent's counsel from the Office of the Solicitor General had the occasion to manifest in open court that the State has no opposition to petitioner's stay in the country provided he first leave and re-enter and re-apply for residency if only to comply with the Summary Deportation Order of 1995. That, to Our mind, seems preposterous, if not ridiculous. An individual's human rights and rights to freedom, liberty and self-determination recognize no boundaries in the democratic, free and civilized world. Such rights follow him wherever he may be. Ifpresently, there is no factual or legal impediment to disqualify petitioner in his stay in the country, other than allegedly those relied upon in the Summary Deportation Order of 1995 (as hereinbefore discussed, had ceased to exist), requiring petitioner to leave the country and re-enter and re-apply for residency makes little sense or no sense at all, more so, in the case of petitioner who, for many years past, had lived herein and nurtured a family that is Filipino. Thus, opined, We, therefore, believe and hereby rule, that there is presently every reason to enjoin/prohibit the Bureau of Immigration, respondent Commissioner Domingo in particular, from presently deporting petitioner.93 We agree with the Court of Appeals. The Summary Deportation Order had been rendered moot and academic upon the German Embassy's issuance of a new passport to the respondent. The respondent had been in the Philippines as a permanent resident since July 18, 1986, and had married a Filipino citizen, with whom he has two children. He is not a burden to the country nor to the people of Palawan. He put up, and has been managing, the Bavaria Restaurant with about 30 employees. He has no pending criminal case; nor does he have any derogatory record. The respondent was allowed by then Immigration Commissioner Verceles to renew his passport and was given time to secure a clearance from the German Embassy. The respondent was able to do so. The case against him for physical injuries was dismissed by the German District Court. Thus, the inceptual basis for the respondent's deportation had ceased to exist. The power to deport is a police matter against undesirable aliens, whose presence in the country is found to be injurious to the public good. We believe that the deportation of the respondent late in the day did not achieve the said purpose. The petitioner admitted that there is no longer a factual and legal basis to disqualify the respondent from staying in the country. He is not an undesirable alien; nor is his presence in the country injurious to public good. He is even an entrepreneur and a productive member of society. Arrest, detention and deportation orders of aliens should not be enforced blindly and indiscriminately, without regard to facts and circumstances that will render the same unjust, unfair or illegal. 94 To direct the respondent to leave the country first before allowing him re-entry is downright iniquitous. 95 If the respondent does leave the country, he would thereby be accepting the force and effect of the BOC's Summary Deportation Order with its attendant infirmities. He will thereby lose his permanent resident status and admit the efficacy of the cancellation of his permanent resident visa. Moreover, his entry into the country will be subject to such conditions as the petitioner may impose.

The deportation of an alien is not intended as a punishment or penalty. But in a real sense, it is. In Bridges v. Wixon, 96Mr. Justice Murphy declared that the impact of deportation upon the life of an alien is often as great if not greater than the imposition of a criminal sentence. In dealing with deportation, there is no justifiable reason for disregarding the democratic and human tenets of our legal system and descending to the practices of despotism. As Justice Brewer opined in Fong Yue Ting v. United States, 97 deportation is a punishment because it requires first, an arrest, a deprivation of liberty and second, a removal from home, from family, from business, from property. To be forcibly taken away from home, family, business and property and sent across the ocean to a distant land is punishment; and that oftentimes is most severe and cruel. It would be putting salt on the respondent's woes occasioned by the BOC's ineptitude. Considering the peculiar backdrop and the equities in this case, the respondent's deportation and the cancellation of his permanent resident visa as a precondition to his re-entry into this country is severe and cruel; it is a form of punishment. aCSEcA Our ruling in Vivo v. Cloribel, 98 has no application in this case, precisely because the factual milieu here is entirely different. In that case, the Commissioner of Immigration required the respondents to leave the country on or before September 12, 1962, because their stay in the country as approved by the Secretary of Justice had been cancelled. Our ruling in Bing v. Commission on Immigration, 99 even buttresses the case for the respondent since we ruled therein that an alien entitled to a permanent stay cannot be deported without being accorded due notice and hearing. IN LIGHT OF ALL THE FOREGOING, the petition is DENIED. The Decision of the Court of Appeals is AFFIRMED. CHRISTINE CHUA, petitioner, vs. BELTRAN, respondents. JORGE TORRES and ANTONIO

F. Reyes Cabigao for petitioner. Emmanuel M. Bona for respondents.

SYLLABUS 1.REMEDIAL LAW; ACTIONS; PLEADINGS; SIGNIFICANCE OF VERIFICATION REQUIREMENT, JUSTIFIED. The verification requirement is significant, as it is intended to secure an assurance that the allegations in the pleading are true and correct and not the product of the imagination or a matter of speculation, and that the pleading is filed in good faith. The absence of a proper verification is cause to treat the pleading as unsigned and dismissible. 2.ID.; ID.; PARTIES; REAL PARTY OF INTEREST; CONSTRUED. It is elementary that it is only in the name of a real party in interest that a civil suit may be prosecuted. Under Section 2, Rule 3 of the Rules of Civil Procedure, a real party in interest is the party who stands to be benefited or injured by the judgment in the suit, or the party entitled to the avails of the suit. "Interest" within the meaning of the rule means material interest, an interest in issue and to be affected by the decree, as distinguished from mere interest in the question involved, or a mere incidental interest. One having no right or interest to protect cannot invoke the jurisdiction of the court as a party plaintiff in an action. To qualify a person to be a real party in interest in whose name an action must be prosecuted, he must appear to be the present real owner of the right sought to enforced. 3.ID.; ID.; ID.; NECESSARY PARTY; DEFINED. Section 8, Rule 7 of the Rules of Civil Procedure defines a necessary party as "one who is not indispensable but who ought to be joined as a party if complete relief is to be accorded as to those already parties, or for a complete determination or settlement of the claim subject of the action." Necessary parties are those whose presence is necessary to adjudicate the whole controversy, but whose interests are so far separable that a final decree can be made in their absence without affecting them.

4.ID.; ID.; ID.; ID.; MISJOINDER AND NON-JOINDER OF PARTIES; NEITHER IS A GROUND FOR DISMISSAL OF ACTION; RATIONALE. Section 11, Rule 3 of the 1997 Rules of Civil Procedure states: Neither misjoinder nor nonjoinder of parties is ground for dismissal of an action. Parties may be dropped or added by order of the court on motion of any party or on its own initiative at any stage of the action and on such terms as are just. Any claim against a misjoined party may be severed and proceeded with separately. Clearly, misjoinder of parties is not fatal to the complaint. The rule prohibits dismissal of a suit on the ground of non-joinder or misjoinder of parties. Moreover, the dropping of misjoined parties from the complaint may be done motu proprio by the court, at any stage, without need for a motion to such effect from the adverse party. Section 11, Rule 3 indicates that the misjoinder of parties, while erroneous, may be corrected with ease through amendment, without further hindrance to the prosecution of the suit. It should then follow that any act or omission committed by a misjoined party plaintiff should not be cause for impediment to the prosecution of the case, much less for the dismissal of the suit. After all, such party should not have been included in the first place, and no efficacy should be accorded to whatever act or omission of the party. Since the misjoined party plaintiff receives no recognition from the court as either an indispensable or necessary party-plaintiff, it then follows that whatever action or inaction the misjoined party may take on the verification or certification against forum-shopping is inconsequential. The blame may in the final analysis lie with petitioner, yet we should not construe the rules of procedure to quench an unnecessary thirst to punish at the expense of the intellectual integrity of the rules. For our Rules of Court do not regard the misjoinder of parties as an error of fatal consequence, and the logical extension of this principle is to consider those procedural acts or omissions of misjoined parties as of similar import.

Beltran's purported negligence amounted to either malicious prosecution or serious defamation in prosecuting petitioner resulting from the issuance of a check she herself did not draw, and served cause for a claim of moral damages. On the other hand, Torres, as employer of Beltran, was alleged to have failed to observe the diligence of a good father of the family to prevent the damage suffered by petitioner. Exemplary damages and attorney's fees were likewise sought, thus bringing the aggregate total of damages claimed to Two Million Pesos (P2,000,000.00), plus costs of suit. 5 Significantly, while Jonathan Chua was named as a plaintiff to the suit, it was explicitly qualified in the second paragraph of the complaint that he was being "impleaded here-in as a necessary party-plaintiff". 6 There was no allegation in the complaint of any damage or injury sustained by Jonathan, and the prayer therein expressly named petitioner as the only party to whom respondents were sought to recompense. 7 Neither did Jonathan Chua sign any verification or certification against forum-shopping, although petitioner did sign an attestation, wherein she identified herself as "the principal plaintiff". 8 Upon motion of respondents, the RTC ordered the dismissal of the complaint 9 on the ground that Jonathan Chua had not executed a certification against forum-shopping. The RTC stressed that Section 5, Rule 7 of the Rules of Civil Procedure, the rule requiring the certification, makes no distinction whether the plaintiff required to execute the certification is a principal party, a nominal party or a necessary party. Instead, the provision requires that a plaintiff or principal party who files a complaint or initiatory pleading execute such certification. Jonathan Chua, being a plaintiff in this case, was obliged to execute or sign such certification. 10 Hence, his failure to do so in violation of the mandatory rule requiring the certification against forum-shopping constituted valid cause for the dismissal of the petition. 11 After the RTC denied the motion for reconsideration 12 lodged by petitioner, the matter was elevated directly to this Court by way of petition for review under Rule 45, raising a purely legal question, 13 cast, if somewhat unwieldily, as "whether or not a co-plaintiff impleaded only as a necessary party, who however has no claim for relief or is not asserting any claim for relief in the complaint, should also make a certification against forum shopping." 14 Preliminarily, it bears noting that Jonathan Chua did not sign as well any verification to the complaint, ostensibly in violation of Section 7, Rule 4 of the Rules of Civil Procedure. The RTC failed to mention such fact, as does petitioner in her present petition. In their arguments before this Court, respondents do refer in passing to the verification requirement15 , but do not place any particular focus thereto. The verification requirement is separate from the certification requirement. 16 It is noted that as a matter of practice, the verification is usually accomplished at the same time as the certification against forum-shopping; hence the customary nomenclature, "Verification and Certification of Non Forum-Shopping" or its variants. For this reason, it is quite possible that the RTC meant to assail as well the failure of Jonathan Chua to verify the complaint. DaTICc The verification requirement is significant, as it is intended to secure an assurance that the allegations in the pleading are true and correct and not the product of the imagination or a matter of speculation, and that the pleading is filed in good faith. 17 The absence of a proper verification is cause to treat the pleading as unsigned and dismissible. 18 It would be as well that the Court discuss whether under the circumstances, Jonathan Chua is also required to execute a verification in respect to petitioner's complaint. Having established the proper parameters of the petition, we proceed to the core issues. We find the petition has merit, although we appreciate the situation differently from petitioner. Our decision proceeds from the fundamental premise that Jonathan Chua was misjoined as a party plaintiff in this case. It is elementary that it is only in the name of a real party in interest that a civil suit may be prosecuted. 19 Under Section 2, Rule 3 of the Rules of Civil Procedure, a real party in interest is the party who stands to be benefited or injured by the judgment in the suit, or the party entitled to the avails of the suit. "Interest" within the meaning of the rule means material interest, an interest in issue and to be affected by the decree, as distinguished from mere interest in the question involved, or a mere incidental interest. 20 One having no right or interest to protect cannot

DECISION

TINGA, J p: The Court settles an issue, heretofore undecided, on whether the absence of the signature in the required verification and certification against forum-shopping of a party misjoined as a plaintiff is a valid ground for the dismissal of the complaint. We rule in the negative. The relevant facts in this Petition for Review are culled from the records. On 24 October 2001, a complaint for damages was lodged before the Regional Trial Court (RTC) of Caloocan City, Branch 126. 1 The complaint was filed by Christine Chua, herein petitioner, impleading her brother Jonathan Chua as a necessary co-plaintiff. Named as defendants in the suit were herein respondents Jorge Torres and Antonio Beltran. Torres was the owner of the 9th Avenue Caltex Service Center (Caltex Service Center), while Beltran was an employee of the said establishment as the head of its Sales and Collection Division. 2 The complaint alleged that on 3 April 2000, Jonathan Chua issued in favor of the Caltex Service Center his personal Rizal Commercial Banking Corporation (RCBC) Check No. 0412802 in the amount of Nine Thousand Eight Hundred Forty Nine Pesos and Twenty Centavos (P9,849.20) in payment for purchases of diesel oil. However, the check was dishonored by the drawee bank when presented for payment on the ground that the account was closed. Beltran then sent petitioner a demand letter informing her of the dishonor of the check and demanding the payment thereof. Petitioner ignored the demand letter on the ground that she was not the one who issued the said check. Without bothering to ascertain who had actually issued the check, Beltran instituted against petitioner a criminal action for violation of Batas Pambansa Bilang 22 (B.P. 22). Subsequently, a criminal information was filed against petitioner with the Metropolitan Trial Court (MTC) of Caloocan City, Branch 50. 3 The MTC then issued a warrant of arrest against petitioner. The police officers tasked with serving the warrant looked for her in her residence, in the auto repair shop of her brother, and even at the Manila Central University were she was enrolled as a medical student, all to the alleged embarrassment and "social humiliation" of petitioner. 4

invoke the jurisdiction of the court as a party plaintiff in an action. 21 To qualify a person to be a real party in interest in whose name an action must be prosecuted, he must appear to be the present real owner of the right sought to enforced. 22 The subject complaint does not allege any rights of Jonathan Chua violated by respondents, present any rights of his to be enforced, or seek in his behalf any rights to the avails of suit. In short, Jonathan claims nothing, and for nothing, in the subject complaint. If he alone filed the complaint, it would have been dismissed on the ground that the complaint states no cause of action, instituted as it was by a person who was not a real party in interest. But was it proper for petitioner to have even impleaded Jonathan as a co-plaintiff in the first place? Petitioner alleged in her complaint that Jonathan was a necessary party, and remains consistent to that claim even before this Court. She however fails to demonstrate how Jonathan can be considered as a necessary party, other than by noting that he was "the one who really issued the check in controversy." 23 Such fact, if proven, may establish the malice of respondents in filing the criminal case against petitioner for violation of B.P. 22, but does not create the need to require Jonathan's participation as a necessary party. Section 8, Rule 7 of the Rules of Civil Procedure defines a necessary ought to be joined as a party if complete relief is to be accorded determination or settlement of the claim subject of the action." 24 necessary to adjudicate the whole controversy, but whose interests made in their absence without affecting them. 25 party as "one who is not indispensable but who as to those already parties, or for a complete Necessary parties are those whose presence is are so far separable that a final decree can be

It may be so that Jonathan may be called to testify by his sister, in order to prove the essential allegation that she did not issue the check in question, and perhaps such testimony would be vital to petitioner's cause of action. But this does not mean that Jonathan should be deemed a necessary party, as such circumstance would merely place him in the same class as those witnesses whose testimony would be necessary to prove the allegations of the complaint. But the fact remains that Jonathan would stand unaffected by the final ruling on the complaint. The judicial confirmation or rejection of the allegations therein, or grant or denial of the reliefs prayed for will not infringe on or augment any of his rights under the law. If there would be any effect to Jonathan of the RTC's ultimate decision on the complaint, it would be merely emotional, arising from whatever ties of kinship he may retain towards his sister, and no different from whatever effects that may be similarly sustained on petitioner's immediate family. Since we are unconvinced by petitioner's basic premise that Jonathan was a necessary party, it is unnecessary to directly settle the issue as couched by petitioner of "whether or not a co-plaintiff impleaded only as a necessary party, who however has no claim for relief or is not asserting any claim for relief in the complaint, should also make a certification against forum shopping." 28 We can note, as the RTC did, that Section 5, Rule 7 of the 1997 Rules of Civil Procedure makes no distinctions that would expressly exempt a necessary party from executing the certification against forum shopping. Nonetheless, there are dimensions to the matter, heretofore unraised, that may unsettle a strict application of the rule, such as if the necessary party is impleaded as a plaintiff or counterclaimant without his knowledge or against his will. 29 But these circumstances relevant to a necessary party are not present in this case, and thus require no further comment upon for now. Instead, what the Court may rule upon is whether the absence of the signature of the person misjoined as a partyplaintiff in either the verification page or certification against forum-shopping is ground for the dismissal of the action. We rule that it is not so, and that the RTC erred in dismissing the instant complaint. There is no judicial precedent affirming or rejecting such a view, but we are comfortable with making such a pronouncement. A misjoined party plaintiff has no business participating in the case as a plaintiff in the first place, and it would make little sense to require the misjoined party in complying with all the requirements expected of plaintiffs. At the same time, Section 11, Rule 3 of the 1997 Rules of Civil Procedure states: Neither misjoinder nor non-joinder of parties is ground for dismissal of an action. Parties may be dropped or added by order of the court on motion of any party or on its own initiative at any stage of the action and on such terms as are just. Any claim against a misjoined party may be severed and proceeded with separately. 30 Clearly, misjoinder of parties is not fatal to the complaint. The rule prohibits dismissal of a suit on the ground of nonjoinder or misjoinder of parties. 31 Moreover, the dropping of misjoined parties from the complaint may be done motu proprio by the court, at any stage, without need for a motion to such effect from the adverse party. 32 Section 11, Rule 3 indicates that the misjoinder of parties, while erroneous, may be corrected with ease through amendment, without further hindrance to the prosecution of the suit. DaTICc It should then follow that any act or omission committed by a misjoined party plaintiff should not be cause for impediment to the prosecution of the case, much less for the dismissal of the suit. After all, such party should not have been included in the first place, and no efficacy should be accorded to whatever act or omission of the party. 33 Since the misjoined party plaintiff receives no recognition from the court as either an indispensable or necessary party-plaintiff, it then follows that whatever action or inaction the misjoined party may take on the verification or certification against forum-shopping is inconsequential. Hence, it should not have mattered to the RTC that Jonathan Chua had failed to sign the certification against forum-shopping, since he was misjoined as a plaintiff in the first place. The fact that Jonathan was misjoined is clear on the face of the complaint itself, and the error of the RTC in dismissing the complaint is not obviated by the fact that the adverse party failed to raise this point. After all, the RTC could have motu proprio dropped Jonathan as a plaintiff, for the reasons above-stated which should have been evident to it upon examination of the complaint.

An example of a necessary party may be found in Seno v. Mangubat. 26 Petitioner therein sold her property through a deed of sale to three vendees. Two of the vendees then sold their shares to the third buyer, who then sold the property to another set of persons. Thereafter, petitioner, who claimed that the true intent of the first sale was an equitable mortgage, filed a complaint seeking the reformation of the deed of sale and the annulment of the second sale. The question arose whether the two vendees who had since disposed of their shares should be considered as indispensable parties or necessary parties. In concluding that they were only necessary parties, the Court reasoned: In the present case, there are no rights of defendants Andres Evangelista and Bienvenido Mangubat to be safeguarded if the sale should be held to be in fact an absolute sale nor if the sale is held to be an equitable mortgage. Defendant Marcos Mangubat became the absolute owner of the subject property by virtue of the sale to him of the shares of the aforementioned defendants in the property. Said defendants no longer have any interest in the subject property. However, being parties to the instrument sought to be reformed, their presence is necessary in order to settle all the possible issues of the controversy. Whether the disputed sale be declared an absolute sale or an equitable mortgage, the rights of all the defendants will have been amply protected. Defendantsspouses Luzame in any event may enforce their rights against defendant Marcos Mangubat. 27

In Seno, the persons deemed by the Court as necessary parties may have had already disposed of their interests in the property. However, should the lower court therein grant the prayer for the reformation of the deed of sale, the ruling will undoubtedly have an effect on such parties, on matters such as the purchase price which they may have received, and on whatever transmission of rights that may have occurred between them and the vendor. In contrast, Jonathan Chua does not stand to be affected should the RTC rule either favorably or unfavorably of the complaint. This is due to the nature of the cause of action of the complaint, which alleges an injury personal to petitioner, and the relief prayed for, which is to be adjudicated solely to petitioner. There is no allegation in the complaint alleging any violation or omission of any right of Jonathan, either arising from contract or from law.

There may be a school of thought that would nonetheless find some satisfaction in petitioner's woes before the RTC, as it was her error in the first place of wrongfully impleading her brother as a party plaintiff which ultimately served as cause for the dismissal of the complaint. The blame may in the final analysis lie with petitioner, yet we should not construe the rules of procedure to quench an unnecessary thirst to punish at the expense of the intellectual integrity of the rules. For our Rules of Court do not regard the misjoinder of parties as an error of fatal consequence, and the logical extension of this principle is to consider those procedural acts or omissions of misjoined parties as of similar import. WHEREFORE, the Petition is GRANTED. The Orders dated 3 December 2001 and 15 January 2002 of the Regional Trial Court of Caloocan City, Branch 126, in Civil Case No. C-19863 are SET ASIDE, and the Complaint in the aforementioned case is REINSTATED. The lower court is enjoined to hear and decide the case with deliberate dispatch. No pronouncement as to costs. REPUBLIC OF THE PHILIPPINES, petitioner, JOSE D. CAMPOS, JR., petitionerintervenor, vs.THE HONORABLE SANDIGANBAYAN, FIRST DIVISION, TEODORO Q. PENA, GORGONIO MACARIOLA, ORLANDO PACIENCIA, JESUS TUPALAR, SEVERINO DELA CRUZ, AND FE CORTEZO, respondents.

concessions, avoid a litigation or put an end to one already commenced." On the other hand, there is no similar general rule in criminal prosecutions. Immunity must be specifically granted. 4.ID.; ID.; RULE ON AMICABLE SETTLEMENTS APPLICABLE TO PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT CASES. The PCGG issued a resolution dated May 28, 1986, granting immunity from both civil and criminal prosecutions to Jose Y. Campos and his family. Undoubtedly, this resolution embodies a compromise agreement between the PCGG on one hand and Jose Y. Campos on the other. Hence, in exchange for the voluntary surrender of the ill-gotten properties acquired by the then President Ferdinand E. Marcos and his family which were in Jose Campos' control, the latter and his family were given full immunity in both civil and criminal prosecutions. In the absence of an express prohibition, the rule on amicable settlements and/or compromises on civil cases under the Civil Code is applicable to PCGG cases. This is the proper interpretation of the law in the light of the purposes enumerated in Executive Order No. 14. 5.ID.; ID.; TECHNICAL RULES SET ASIDE TO ACHIEVE PURPOSES OF PCGG'S CREATION. We note that the law governing the issues raised in this petition calls for the setting aside of technical rules when necessary to achieve the purposes behind the PCGG's creation. It is to be reiterated that paragraph 2 of section 3, of Executive Order No. 14 reads: . . . "The technical rules of procedure and evidence shall not be strictly applied to the civil cases filed hereunder." 6.STATUTORY CONSTRUCTION; PROVISIONS OF EXECUTIVE ORDER NO. 14 TO PREVAIL OVER ANY AND ALL LAWS RELATIVE TO THE INVESTIGATION, PROSECUTION AND TRIAL OF ILL-GOTTEN CASES. Section 7 of Executive Order No. 14 provides "SECTION 7. The provisions of this Executive Order shall prevail over any and all laws, or parts thereof, as regards the investigation, prosecution, and trial of cases for violations of laws involving the acquisition and accumulation of ill-gotten wealth as mentioned in Executive Order Nos. 1 and 2." A settled rule on construction is found in the case of Leveriza v. Intermediate Appellate Court, (157 SCRA 282 [1988]): ". . . that another basic principle of statutory construction mandates that general legislation must give way to special legislation on the same subject, and generally be so interpreted as to embrace only cases in which the special provisions are not applicable (Sto. Domingo v. De los Angeles, 96 SCRA 139), that a specific statute prevails over a general statute (De Jesus v. People, 120 SCRA 760) and that where two statutes are of equal theoretical application to a particular case, the one designed therefor specially should prevail (Will Wilhensen, Inc. v. Baluyot, 83 SCRA 38). 7.CIVIL PROCEDURE; DROPPING OF PARTIES BASED ON MOTION OF ANY PARTY. From the viewpoint of procedure, the PCGG was right when it filed a motion to drop Jose Campos, Jr. as defendant in the civil case. Section 11, Rule 3 of the Rules of Court so provides. This rule was interpreted in the case of Lim Tanhu v. Ramolete, 66 SCRA 425 (1975): The rule presupposes that the original inclusion had been made in the honest conviction that it was proper and the subsequent dropping is requested because it turned out that such inclusion was a mistake. And this is the reason why the rule ordains that the dropping be 'on such terms as are just' just to all the other parties." 8.ID.; INDISPENSABLE PARTY; SOLIDARITY DOES NOT MAKE A SOLIDARY OBLIGOR AN INDISPENSABLE PARTY. The fact that Campos, Jr. and all the other defendants were charged solidarily in the complaint does not make him an indispensable party. We have ruled in the case of Operators Incorporated v. American Biscuit Co., Inc., [154 SCRA 738 (1987)] that "Solidarity does not make a solidary obligor an indispensable party in a suit filed by the creditor. Article 1216 of the Civil Code says that the creditor 'may proceed against anyone of the solidary debtors or some or all of them simultaneously.'" SARMIENTO, J., dissenting: CONSTITUTIONAL LAW; PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT; AUTHORITY TO GRANT IMMUNITY; PCGG MUST SHOW THAT THE REPUBLIC IS NOT GETTING ANY RAW DEAL BY VIRTUE OF THE IMMUNITY. It is my own opinion that the petitioner-intervenor should not be dropped from the case by reason merely of the alleged immunity granted by the Presidential Commission on Good Government. Hence, I vote to

Sycip, Salazar, Hernandez & Gatmaitan for petitioner-intervenor. Napoleon M. Gamo for respondent Teodoro Pea. Apostol, Bernas, Gumaru & Ora for private respondents.

SYLLABUS 1.SANDIGANBAYAN; JURISDICTION OVER ILL-GOTTEN WEALTH CASES DEFINED BY EXECUTIVE ORDER NO. 14. In the case of Presidential (Commission on good Government v. Pea (159 SCRA 556 [1988]), the court interpreted the Sandiganbayan's jurisdiction under this statute to extend to "all cases of the commission . . ., and all incidents The jurisdiction of the Sandiganbayan which is tasked to handle the ill-gotten wealth cases must include the jurisdiction to determine whether or not the PCGG exceeded its power to grant immunity pursuant to the provisions of Executive Order No. 14.

arising from, incidental to, or related to (them), such cases necessarily fail likewise under the Sandiganbayan's exclusive and original jurisdiction subject to review on certiorari exclusively by the Supreme Court ." (pp. 561-562).

2.PRESIDENTIAL COMMISSION ON GOOD GOVERNMENT; AUTHORITY TO GRANT CIVIL IMMUNITY. A cursory reading of Executive Order No. 14 shows that the PCGG is authorized to file both criminal and civil cases against persons suspected of having acquired ill-gotten wealth. This provision, together with section 5 of the law in relation to the purposes for which the PCGG was created must be taken into consideration in determining whether or not the PCGG has authority to grant civil immunity. It is crystal clear from the law that the PCGG may file an independent civil action separate from the criminal action. Hence, section 5 thereof which empowers the PCGG to grant criminal immunity must be interpreted to relate only to a criminal action and not to a civil action. In case of a civil action, the power to grant immunity or the making of the decision not to file a civil case or to drop one already in progress must be related to section 3 of the law which specifically provides for the procedures and the applicable laws in the prosecution of civil suits. 3.CIVIL PROCEDURE; CIVIL CASES; AMICABLE SETTLEMENTS THEREIN ENCOURAGED. The well-settled doctrine is that amicable settlements and or compromises are not only allowed but actually encouraged in civil cases. Article 2028 of the Civil Code categorically states: "A compromise is a contract whereby the parties, by making reciprocal

sustain the action of the respondent Sandiganbayan. While I agree that the grant of immunity unto Mr. Campos, Jr. amounts to a compromise, and compromises are "not only allowed but actually encouraged in civil cases," it is my view that the parties, the PCGG in particular, must nonetheless satisfy the Sandiganbayan that the Republic is not getting a raw deal by virtue thereof. This is especially so because ". . . there shall be no execution except in compliance with a judicial compromise." Indeed, without a judicial approval, the Republic would have been left with nothing.

being a member of the immediate family of Jose Y. Campos.' Xerox copy of said Manifestation and Motion, etc., is hereto attached as Annex "C" hereof.

DECISION

"4.On September 23, 1987, petitioner filed with the respondent Court a 'Motion' seeking to drop defendant Jose D. Campos, Jr. from the Complaint on the ground that the Presidential Commission on Good Government (PCGG for short) had, in a Resolution dated May 28, 1986, granted immunity to Mr. Jose Y. Campos and his family, which immunity necessarily extends to defendant Jose D. Campos, Jr. who is the son of said Mr. Jose Y. Campos. Xerox copy of said Motion is hereto attached as Annex 'D' hereof. "5.The private respondents opposed petitioner's motion. Defendant Jose D. Campos, Jr. filed his reply. "6.Meanwhile, on January 28, 1988, petitioner filed with the respondent Court an Amended/Expanded Complaint, xerox copy of which is hereto attached as Annex 'E' hereof. "7.On February 8, 1988, respondent Court issued a Resolution (Annex 'A' hereof) which, as abovestated, denied petitioner's and Jose D. Campos, Jr.'s motions to drop him from the complaint. "8.On March 7, 1988, defendant Jose D. Campos, Jr. filed a 'Motion for Reconsideration of the Resolution Dated February 8, 1988', xerox copy of which is hereto attached as Annex 'F' hereof. "9.On March 10, 1988, petitioner also filed its separate 'Motion for Reconsideration' of the Resolution of February 8, 1988, xerox copy of which is hereto attached as Annex 'G' hereof. "10.On August 18, 1988, respondent Court issued a Resolution (Annex 'B' hereof) denying petitioner's and defendant Jose D. Campos, Jr.'s motions for reconsideration. A copy of the Resolution was received by the Office of the Solicitor General on August 24, 1988." (pp. 4-8, Rollo) The original petition was against the Sandiganbayan and six private respondents who opposed the motion to drop Campos, Jr. from the complaint. Upon motion, we allowed Jose D. Campos, Jr. to file a petition-in-intervention. In a resolution dated March 29, 1988, we issued a temporary restraining order ordering the Sandiganbayan to cease and desist from proceeding with Civil Case No. 0010. The main issue in the instant petition hinges on whether or not the petitioner can validly drop Jose D. Campos, Jr. as party defendant in Civil Case No. 0010 by virtue of the PCGG's grant of immunity in favor of his father Jose Y. Campos and the latter's family. The Sandiganbayan ruled in the negative. It denied the Republic's and petitioner Jose D. Campos, Jr.'s motions for reconsideration on the following grounds.

GUTIERREZ, JR., J p: The petitioner charges the Sandiganbayan with grave abuse of discretion amounting to lack or excess of jurisdiction in denying its motion to drop Jose D. Campos, Jr. as defendant in its complaint for reconveyance, reversion, accounting, restitution and damages filed against Jose D. Campos, Jr. and the other defendants in Civil Case No. 0010. The antecedent facts are stated by the Solicitor General as follows: "1.On July 22, 1987, petitioner filed with respondent Court a complaint for reconveyance, reversion, accounting, restitution and damages against Alfredo (Bejo) T. Romualdez, Ferdinand E. Marcos, Imelda R. Marcos, Jose D. Campos, Jr. and forty five (45) other defendants including the above-named private respondents, docketed thereat as Civil Case No. 0010 (PCGG 11), seeking to 'recover from them ill-gotten wealth consisting of funds and other property which they [acting singly or collectively and] in unlawful concert with one another, had acquired and accumulated in flagrant breach of trust and of their fiduciary obligations as public officers, with grave abuse of right and power and in brazen violation of the Constitution and laws of the Republic of the Philippines', including the misappropriation and theft of public funds, plunder of the nation's wealth, extortion, blackmail, bribery, embezzlement and other acts of corruption, betrayal of public trust and brazen abuse of power, as more fully described in the Complaint thus 'resulting in their unjust enrichment during defendant Ferdinand E. Marcos' 20 years of rule from December 30, 1965 to February 25, 1986, first as President of the Republic of the Philippines under the 1935 Constitution and, thereafter, as one-man ruler under martial law and Dictator under the 1973 Marcospromulgated Constitution . . . at the expense and to the grave and irreparable damage of Plaintiff and the Filipino people'. (pp. 2-3, complaint). "2.Summonses were subsequently issued in due time by the respondent Court against defendants therein. "3.Sometime in the later part of August 1987, defendant Jose D. Campos, Jr., having been served with summons on August 5, 1987, filed with the respondent Court an undated 'Manifestation and Motion to Dismiss Complaint with Respect to Jose D. Campos' praying that he be removed as party defendant from the complaint on the grounds that he had 'voluntarily surrender(ed) or turn(ed) over [any share in his name on any of the corporations referred to, aside from disclaiming any interest, ownership or right thereon] to the Government of the Republic of the Philippines' and that he was 'entitled to the immunity granted by the Presidential Commission on Good Government pursuant to Executive Order No. 14, under the Commission's Resolution dated May 28, 1986 . . . to Mr. Jose Y. Campos (and) his family' he

"1)The PCGG did not then and does not now have the power to grant civil immunity; "2)Even if it did, the grant of immunity itself rendered in the PCGG's resolution dated May 28, 1986 has not been shown to cover the transactions involving the corporations and or properties for which Jose D. Campos, Jr., is now sought to be held accountable, i.e., Metroport Services, Inc.; "3)The fact is that nowhere, either in the original motions or in the Motion for Reconsideration before this Court has it been shown that, save for the alleged unqualified immunity, there no longer exists any demandable claim against Jose D. Campos, Jr., arising from the transactions resulting in his being impleaded thereon. In other words, were it not for the supposed grant of immunity, Jose D. Campos, Jr., would remain liable in the matter of Metroport Services, Inc., and for the 60% which Alfredo (Bejo) Romualdez acquired there in according to paragraph 14(c) of the Complaint (supra) which does not appear to have been restored or compensated for." (p. 54, Rollo). The petitioner contends otherwise. The Solicitor General asserts that the name of Jose D. Campos, Jr. was included as defendant in the complaint through mistake or oversight and that pursuant to section 1 1, Rule 3 of the Revised Rules of Court it has a right to drop him as defendant without prior consent of any party. The Solicitor General also maintains that although the defendants in the case were charged solidarily, Campos, Jr. was not an indispensable party since Article 1216 of the Civil Code allows the petitioner as solidary creditor to choose among the solidary debtors against whom it will enforce collection. Jose Campos, Jr. adds that the petitioner's motion to drop him as defendant should be considered as one filed under section 1, Rule 17 of the Revised Rules of Court thus giving it the absolute right to dismiss the action by mere notice of dismissal. cdrep Above all these technicalities, the petitioner maintains that the resolutions of the Sandiganbayan which ruled that the PCGG does not have the power to grant civil immunity frustrated the earnest efforts at recovery of ill-gotten wealth recognized in the Constitution, and Executive Orders Numbers 1, 2, 14 and 14-A. The petitioner contends that the non-observance of the immunity provision granted by the PCGG will hinder the voluntary cooperation of known Marcos cronies to enter into amicable settlements or compromises with respect to the recovery of ill-gotten wealth. The petitioner also argues that the PCGG's power to grant criminal immunity under Section 5 of Executive Order No. 14 carries with it the implied power to enter into compromises and amicable settlements in line with its duty to recover ill-gotten wealth expeditiously, efficiently and effectively. Given these considerations, the petitioner insists that the May 28, 1986 resolution of the PCGG which granted immunity from both civil and criminal prosecution to Jose Y. Campos and his family is a valid official act of the PCGG and since Jose Campos, Jr. is a legitimate son of Jose Y. Campos, he must be deemed covered by the grant of immunity. Furthermore, petitioner-intervenor Campos, Jr. states that the Sandiganbayan has no jurisdiction to determine the validity of the grant of immunity and release from civil liability to the intervenor as there is no dispute between him and the PCGG. Thus, Campos, Jr. argues that "Except in a litigation arising from a disagreement between the one claiming to be a beneficiary and the PCGG/Republic, the Sandiganbayan is without competence to review the validity or extent of the PCGG granted and the Republic supported grant of immunity from criminal prosecution and release from civil liability." (p. 216, Rollo) We first ascertain whether or not the Sandiganbayan has jurisdiction to look into the validity of the immunity granted by the PCGG to Jose Y. Campos which was extended to his son, petitioner-intervenor herein, Jose Campos, Jr. LLjur

Executive Order No. 14 defines "the jurisdiction over cases involving the ill-gotten wealth of former President Ferdinand E. Marcos, Mrs. Imelda R. Marcos, members of their immediate family, close relatives, subordinates, close and/or business associates, dummies, agents and nominees." Section 2 thereof provides that the PCGG shall file all such cases, whether civil or criminal, with the Sandiganbayan, which shall have exclusive and original jurisdiction thereof" In the case of Presidential (Commission on good Government v. Pea (159 SCRA 556 [1988]), the court interpreted the Sandiganbayan's jurisdiction under this statute to extend to "all cases of the commission . . . , and all

incidents arising from, incidental to, or related to (them), such cases necessarily fail likewise under the Sandiganbayan's exclusive and original jurisdiction subject to review on certiorari exclusively by the Supreme Court." (pp. 561-562; Italics supplied). Likewise, in the case of Bataan Shipyard & Engineering Co., Inc. v. Presidential Commission on Good Government, (150 SCRA 181 [1987]), we said:
"It should also by now be reasonably evident from what has thus far been said that the PCGG is not, and was never intended to act as, a judge. It general function is to conduct investigations in order to collect evidenceestablishing instances of 'ill-gotten wealth;' issue sequestration, and such orders as may be warranted by the evidence thus collected and as may be necessary to preserve and conserve the assets of which it takes custody and control and prevent their disappearance, loss or dissipation; and eventually file and prosecute in the proper court of competent jurisdiction all cases investigated by it as may be warranted by its findings. It does not try and decide, or hear and determine, or adjudicate with any character of finality or compulsion, cases involving the essential issue of whether or not property should be forfeited and transferred to the State because 'ill-gotten' within the meaning of the Constitution and the executive orders. This function is reserved to the designated court, in this case, the Sandiganbayan. (Ex. Ord. No. 14)" The powers of the PCGG are not unlimited. Its jurisdiction over cases involving ill-gotten wealth must be within the parameters stated in Executive Order No. 14. Necessarily, the jurisdiction of the Sandiganbayan which is tasked to handle the ill-gotten wealth cases must include the jurisdiction to determine whether or not the PCGG exceeded its power to grant immunity pursuant to the provisions of Executive Order No. 14. We now decide the pivotal issue which is the extent, if any, of the PCGG's power to grant civil immunity. Section 5 of Executive Order No. 14 provides: "SECTION 5.The Presidential Commission on Good Government is authorized to grant immunity from criminal prosecution to any person who testifies to the unlawful manner in which any respondent, defendant or accused has acquired or accumulated the property or properties in question in cases where such testimony is necessary to prove violation of existing laws." Since the aforecited provision mentions the grant of immunity only in criminal prosecutions and under certain circumstances, the Sandiganbayan concluded that the PCGG does not have the power to grant civil immunity much less extend the civil immunity granted to Jose Y. Campos to his son Jose Campos, Jr. The conclusion is erroneous.

A cursory reading of Executive Order No. 14 shows that the PCGG is authorized to file both criminal and civil cases against persons suspected of having acquired ill-gotten wealth. Section 3 thereof provides:

"SECTION 3.Civil suits for restitution, reparation of damages, or indemnification for consequential damages, forfeiture proceedings provided for under Republic Act No. 1379, or any other civil actions under the Civil Code or other existing laws, in connection with Executive Order No. 1 dated February 28, 1986 and Executive Order No. 2 dated March 12, 1986, may be filed separately from and proceed independently of any criminal proceedings and may be proved by a preponderance of evidence." This provision, together with section 5 of the law in relation to the purposes for which the PCGG was created must be taken into consideration in determining whether or not the PCGG has authority to grant civil immunity. ". . . Legislative intent must be ascertained from a consideration of the statute as a whole. The particular words, clauses and phrases should not be studied as detached and isolated expressions, but the whole and every part of the statute must be considered in fixing the meaning of any of its parts and in order to produce a harmonious whole (Araneta v. Concepcion, 99 Phil. 709; Tamayo v. Gsell, 35 Phil. 953; Lopez v. El Hogar Filipino, 47 Phil. 249; Chartered Bank v. Imperial, 48 Phil. 931). A statute must be so construed as to harmonize and give effect to all its provisions whenever possible (People v. Polmon, 86 Phil. 350). The meaning of the law, it must be borne in mind, is not to be extracted from any single part, portion or section or from isolated words and phrases, clauses or sentences but from a general consideration or view of the act as a whole (82 C.J.S., Section 345, pp. 699700). Every part of the statute must be interpreted with reference to the context. This means that every part of the statute must be considered together with the other parts, and kept subservient to the general intent of the whole enactment, not separately and independently (Tamayo v. Gsell, 35 Phil, 953). More importantly, the doctrine of associated words ( Noscitur a Sociis) provides that where a particular word or phrase in a statement is ambiguous in itself or is equally susceptible of various meanings, its true meaning may be made clear and specific by considering the company in which it is found or with which it is associated (Co Kim Cham v. Valdez Tan Keh & Dizon, 75 Phil. 371)." (Aisporna v. The Court of Appeals, 113 SCRA 459 [1982]) It is crystal clear from the law that the PCGG may file an independent civil action separate from the criminal action. Hence, section 5 thereof which empowers the PCGG to grant criminal immunity must be interpreted to relate only to acriminal action and not to a civil action. In case of a civil action, the power to grant immunity or the making of the decision not to file a civil case or to drop one already in progress must be related to section 3 of the law which specifically provides for the procedures and the applicable laws in the prosecution of civil suits. The well-settled doctrine is that amicable settlements and or compromises are not only allowed but actually encouraged in civil cases. Article 2028 of the Civil Code categorically states: "A compromise is a contract whereby the parties, by making reciprocal concessions, avoid a litigation or put an end to one already commenced." On the other hand, there is no similar general rule in criminal prosecutions. Immunity must be specifically granted. cdphil In the instant case, the PCGG issued a resolution dated May 28, 1986, granting immunity from both civil and criminal prosecutions to Jose Y. Campos and his family. The pertinent provisions of the resolution read as follows: "3.0.In consideration of the full cooperation of Mr. Jose Y. Campos to this Commission, his voluntary surrender of the properties and assets disclosed and declared by him to belong to deposed President Ferdinand E. Marcos to the Government of the Republic of the Philippines, his full, complete and truthful disclosures, and his commitment to pay a sum of money as determined by the Philippine Government, this Commission has decided and agreed: "3.1.To grant to Mr. Jose Y. Campos, his family, Mariano K. Tan and Francisco de Guzman immunity from criminal prosecutions, as provided in Section 5 of Executive Order No. 14.

"3.2.To release Mr. Jose Y Campos, his family, Mariano K. Tan and Francisco de Guzman from any and all civil liabilities with respect to all matters arising from his/their past relationship with deposed President Ferdinand E. Marcos. "3.3.To exclude Jose Y. Campos, his family, Mariano K. Tan and Francisco de Guzman from the complaint filed by the Solicitor General with the Commission docketed as Republic of the Philippines v. Ferdinand E. Marcos, et al., PCGG I.S. No. 1 for graft and corrupt practices and other issues related to public service. . . . . (Emphasis supplied.)" (pp. 18-19, Rollo). Undoubtedly, this resolution embodies a compromise agreement between the PCGG on one hand and Jose Y. Campos on the other. Hence, in exchange for the voluntary surrender of the ill-gotten properties acquired by the then President Ferdinand E. Marcos and his family which were in Jose Campos' control, the latter and his family were given full immunity in both civil and criminal prosecutions. In the absence of an express prohibition, the rule on amicable settlements and/or compromises on civil cases under the Civil Code is applicable to PCGG cases. This is the proper interpretation of the law in the light of the purposes enumerated in Executive Order No. 14, to wit: ". . . the vital task of the Commission involves the just and expeditious recovery of such illgotten wealth in order that the funds, assets and other properties may be used to hasten national economic recovery; ". . . the overriding considerations of national interest and national survival require that the Presidential Commission on Good Government achieve its vital task efficiently and effectively, with due regard to the requirements of fairness and due process;" Since petitioner-intervenor Jose Campos, Jr. is a legitimate son of Jose Y. Campos, the full immunity granted to the latter and his family must also extend to the former pursuant to the May 28, 1986 resolution of the PCGG. We note that the law governing the issues raised in this petition calls for the setting aside of technical rules when necessary to achieve the purposes behind the PCGG's creation. It is to be reiterated that paragraph 2 of section 3, of Executive Order No. 14 reads: xxx xxx xxx "The technical rules of procedure and evidence shall not be strictly applied to the civil cases filed hereunder." Section 7 thereof also provides: "SECTION 7.The provisions of this Executive Order shall prevail over any and all laws, or parts thereof, as regards the investigation, prosecution, and trial of cases for violations of laws involving the acquisition and accumulation of ill-gotten wealth as mentioned in Executive Order Nos. 1 and 2." A settled rule on construction is found in the case of Leveriza v. Intermediate Appellate Court, (157 SCRA 282 [1988]): ". . . that another basic principle of statutory construction mandates that general legislation must give way to special legislation on the same subject, and generally be so interpreted as to embrace only cases in which the special provisions are not applicable (Sto. Domingo v. De

los Angeles, 96 SCRA 139), that a specific statute prevails over a general statute (De Jesus v. People, 120 SCRA 760) and that where two statutes are of equal theoretical application to a particular case, the one designed therefor specially should prevail (Wil Wilhensen, Inc. v. Baluyot, 83 SCRA 38). On this score alone, the Sandiganbayan's rejection of the petitioner's motion on the ground that dropping Campos, Jr. as defendant in the civil case would amount to a violation of the Rules of Court is based on shaky ground. The Sandiganbayan's objections will hamper PCGG efforts in this similar cases. By virtue of the PCGG's May 28, 1986 resolution, Jose Campos, Jr. was given full immunity from both civil and criminal prosecutions in exchange for the "full cooperation of Mr. Jose Y. Campos to this Commission, his voluntary

As discussed earlier, the PCGG's motion to drop Campos, Jr. as defendant in Civil Case No. 0010 has legal basis under Executive Order No. 14. The fact that Campos, Jr. and all the other defendants were charged solidarily in the complaint does not make him an indispensable party. We have ruled in the case of Operators Incorporated v. American Biscuit Co., Inc., [154 SCRA 738 (1987)] that "Solidarity does not make a solidary obligor an indispensable party in a suit filed by the creditor. Article 1216 of the Civil Code says that the creditor 'may proceed against anyone of the solidary debtors or some or all of them simultaneously." There is no showing that the dropping of Jose Campos, Jr. as defendant would be unjust to the other defendants in the civil case because, the other defendants can still pursue the case and put up their defenses. In the case of Lim Tanhu v. Ramolete, (supra), the main reason why we did not allow the dropping of two defendants who were charged solidarily with the other remaining defendants, despite the motion of the plaintiff, is the fact that the latter filed such motion after the two remaining defendants defaulted. Thus, we said: cdll ". . . In the case at bar, there is nothing in the record to legally justify the dropping of the non-defaulted defendants, Lim and Leonardo. The motion of October 18, 1974 cites none. From all appearances, plaintiff just decided to ask for it, without any relevant explanation at all. Usually, the court in granting such a motion inquires for the reasons and in the appropriate instances directs the granting of some form of compensation for the trouble undergone by the defendant in answering the complaint, preparing for or proceeding partially to trial, hiring counsel and making corresponding expenses in the premises. Nothing of these, appears in the order in question. Most importantly, His Honor ought to have considered that the outright dropping of the non-defaulted defendants Lim and Leonardo, over their objection at that, would certainly be unjust not only to the petitioners, their own parents, who would in consequence be entirely defenseless, but also to Lim and Leonardo themselves who would naturally correspondingly suffer from the eventual judgment against their parents. Respondent court paid no heed at all to the mandate that such dropping must be 'on such terms as are just' meaning to all concerned with its legal and factual effects." There is no similar reason in this case.

surrender of the properties and assets disclosed and declared by him to belong to deposed President Ferdinand E. Marcos to the Government of the Republic of the Philippines, his full, complete and truthful disclosures, and his commitment to pay a sum of money as determined by the Philippine Government." In addition, Campos, Jr. had
already waived and surrendered to the Republic his registered equity interest in the Marcos/Romualdez corporations involved in the civil case. Thus, as far as the petitioner is concerned, it had already released Campos. Jr. from all criminal and civil liabilities in connection with his association with the said corporations. Under the law, civil liabilities would include restitution and damages in favor of the government.

It is immaterial whether or not Campos, Jr. was given specific or individual immunity from his liabilities as regards the Marcos/Romualdez corporations, the subject matter of Civil Case No. 0010. The grant of full immunity to Campos, Senior and his family covers all of Campos, Jr.'s liabilities, criminal or civil, arising from association with the Marcoses including transactions with the corporations involved in the said civil case. Even from the viewpoint of procedure, the PCGG was right when it filed a motion to drop Jose Campos, Jr. as defendant in the civil case. Section 11, Rule 3 of the Rules of Court states: "SECTION 11, RULE 3.Misjoinder and non-joinder of parties. Misjoinder of parties is not ground for dismissal of an action. Parties may be dropped or added by order of the court on motion of any party or of its own initiative at any stage of the action and on such terms as are just. . . . (Emphasis supplied)" We interpreted this rule in the case of Lim Tanhu v. Ramolete, 66 SCRA 425 (1975): ". . . the latter rule does not comprehend whimsical and irrational dropping or adding of parties in a complaint. What it really contemplates is erroneous or mistaken non-joinder and misjoinder of parties. No one is free to join anybody in a complaint in court only to drop him unceremoniously later at the pleasure of the plaintiff. The rule presupposes that the original inclusion had been made in the honest conviction that it was proper and the subsequent dropping is requested because it turned out that such inclusion was a mistake. And this is the reason why the rule ordains that the dropping be 'on such terms as are just' just to all the other parties."

Moreover, as correctly stated by the herein petitioner: "Under the law, the solidary debtor who pays shall have a right of action against the others for the amount of their respective shares. And, with the dropping of a defendant who pays his share, the other solidary co-defendants are also benefited to the extent of that paid share. Truly, each solidary debtor ends up paying his own share, including the defendant who had been dropped. Hence, there is no injustice." (p. 28, Rollo) WHEREFORE, the instant petition is hereby GRANTED. The questioned resolutions of the Sandiganbayan are REVERSED and SET ASIDE. The Sandiganbayan is ordered to drop Jose Campos, Jr. as defendant in Civil Case No. 0010. The temporary restraining order issued on November 29, 1988 is made permanent insofar as Jose D. Campos, Jr. is concerned. No costs. NIEVES PLASABAS and MARCOS MALAZARTE, petitioners, vs. COURT OF APPEALS (Special Former Ninth Division), DOMINADOR LUMEN, and AURORA AUNZO, respondents.

There is nothing whimsical or capricious in dropping the petitioner-intervenor from the complaint. Quite the contrary, it is based on sound and salutary reasons.

DECISION

NACHURA, J p:

Assailed in this petition for review on certiorari under Rule 45 of the Rules of Court are the May 12, 2004 Decision 1 of the Court of Appeals (CA) in CA-G.R. CV No. 43085 and the December 1, 2004 Resolution 2 denying reconsideration of the challenged decision. THSaEC The pertinent facts and proceedings follow. In 1974, petitioners 3 filed a complaint for recovery of title to property with damages before the Court of First Instance (now, Regional Trial Court [RTC]) of Maasin, Southern Leyte against respondents. The case was docketed as Civil Case No. R-1949. The property subject of the case was a parcel of coconut land in Canturing, Maasin, Southern Leyte, declared under Tax Declaration No. 3587 in the name of petitioner Nieves with an area of 2.6360 hectares. 4 In their complaint, petitioners prayed that judgment be rendered confirming their rights and legal title to the subject property and ordering the defendants to vacate the occupied portion and to pay damages. 5 Respondents, for their part, denied petitioners' allegation of ownership and possession of the premises, and interposed, as their main defense, that the subject land was inherited by all the parties from their common ancestor, Francisco Plasabas. 6 Revealed in the course of the trial was that petitioner Nieves, contrary to her allegations in the complaint, was not the sole and absolute owner of the land. Based on the testimonies of petitioners' witnesses, the property passed on from Francisco to his son, Leoncio; then to Jovita Talam, petitioner Nieves' grandmother; then to Antonina Talam, her mother; and then to her and her siblings Jose, Victor and Victoria. 7 After resting their case, respondents raised in their memorandum the argument that the case should have been terminated at inception for petitioners' failure to implead indispensable parties, the other co-owners Jose, Victor and Victoria. In its April 19, 1993 Order, 8 the trial court, without ruling on the merits, dismissed the case without prejudice, thus: This Court, much as it wants to decide the instant case on the merits, being one of the old inherited cases left behind, finds difficulty if not impossibility of doing so at this stage of the proceedings when both parties have already rested their cases. Reluctantly, it agrees with the defendants in the observation that some important indispensable consideration is conspicuously wanting or missing. CTSDAI It is not the Court's wish to turn its back on the crucial part of the case, which is the pronouncement of the judgment to settle the issues raised in the pleadings of the parties once and for all, after all the time, effort and expense spent in going through the trial process. But, rules are rules. They have to be followed, to arrive at a fair and just verdict. Section 7, Rule 3 of the Rules of Court provides: ". . . Compulsory joinder of indispensable parties. Parties in interest without whom no final determination can be had of an action shall be joined either as plaintiffs or defendants." What the Court wants to say here is that the instant case should have been dismissed prejudice a long time ago for lack of cause of action as the plaintiffs spouses Malazarte and Nieves Plasabas Malazarte have no complete legal personality to themselves alone without joining the brothers and sisters of Nieves who without Marcos sue by are as

INDISPENSABLE as the latter in the final determination of the case. Not impleading them, any judgment would have no effectiveness. They are that indispensable that a final decree would necessarily affect their rights, so that the Court cannot proceed without their presence. There are abundant authorities in this regard. Thus "The general rule with reference to the making of parties in a civil action requires the joinder of all indispensable parties under any and all conditions, their presence being a sine qua non of the exercise of judicial power. (Borlasa v. Polistico, 47 Phil. 345, 348) For this reason, our Supreme Court has held that when it appears of record that there are other persons interested in the subject matter of the litigation, who are not made parties to the action, it is the duty of the court to suspend the trial until such parties are made either plaintiffs or defendants. (Pobre, et al. v. Blanco, 17 Phil. 156). . . . Where the petition failed to join as party defendant the person interested in sustaining the proceeding in the court, the same should be dismissed. . . . When an indispensable party is not before the court, the action should be dismissed. (People, et al. v. Rodriguez, et al., G.R. Nos. L-14059-62, September 30, 1959) (sic) CDISAc "Parties in interest without whom no final determination can be had of an action shall be joined either as plaintiffs or defendants. (Sec. 7, Rule 3, Rules of Court). The burden of procuring the presence of all indispensable parties is on the plaintiff. (39 Amjur [sic] 885). The evident purpose of the rule is to prevent the multiplicity of suits by requiring the person arresting a right against the defendant to include with him, either as co-plaintiffs or as co-defendants, all persons standing in the same position, so that the whole matter in dispute may be determined once and for all in one litigation. (Palarca v. Baginsi, * 38 Phil. 177, 178). "An indispensable party is a party who has such an interest in the controversy or subject matter that a final adjudication cannot be made, in his absence, without inquiring or affecting such interest; a party who has not only an interest of such a nature that a final decree cannot be made without affecting his interest or leaving the controversy in such a condition that its final determination may be wholly inconsistent with equity and good conscience. (67 C.J.S. 892). Indispensable parties are those without whom no action can be finally determined." (Sanidad v. Cabataje, * 5 Phil. 204) WHEREFORE, IN VIEW OF ALL THE FOREGOING CONSIDERATIONS, both the complaint and the counterclaim in the instant case are ordered DISMISSED without prejudice. No pronouncement as to costs. SO ORDERED. 9 Aggrieved, petitioners elevated the case to the CA. In the challenged May 12, 2004 Decision, 10 the appellate court affirmed the ruling of the trial court. The CA, further, declared that the non-joinder of the indispensable parties would violate the principle of due process, and that Article 487 of the Civil Code could not be applied considering that the complaint was not for ejectment, but for recovery of title or a reivindicatory action. 11 With their motion for reconsideration denied in the further assailed December 1, 2004 Resolution, 12 petitioners filed the instant petition.

The Court grants the petition and remands the case to the trial court for disposition on the merits. TaIHEA Article 487 of the Civil Code provides that any one of the co-owners may bring an action for ejectment. The article covers all kinds of actions for the recovery of possession, including an accion publiciana and a reivindicatory action. A co-owner may file suit without necessarily joining all the other co-owners as co-plaintiffs because the suit is deemed to be instituted for the benefit of all. Any judgment of the court in favor of the plaintiff will benefit the other co-owners, but if the judgment is adverse, the same cannot prejudice the rights of the unimpleaded co-owners. 13 With this disquisition, there is no need to determine whether petitioners' complaint is one for ejectment or for recovery of title. To repeat, Article 487 of the Civil Code applies to both actions. Thus, petitioners, in their complaint, do not have to implead their co-owners as parties. The only exception to this rule is when the action is for the benefit of the plaintiff alone who claims to be the sole owner and is, thus, entitled to the possession thereof. In such a case, the action will not prosper unless the plaintiff impleads the other coowners who are indispensable parties. 14 Here, the allegation of petitioners in their complaint that they are the sole owners of the property in litigation is immaterial, considering that they acknowledged during the trial that the property is co-owned by Nieves and her siblings, and that petitioners have been authorized by the co-owners to pursue the case on the latter's behalf. 15 Impleading the other co-owners is, therefore, not mandatory, because, as mentioned earlier, the suit is deemed to be instituted for the benefit of all. In any event, the trial and appellate courts committed reversible error when they summarily dismissed the case, after both parties had rested their cases following a protracted trial commencing in 1974, on the sole ground of failure to implead indispensable parties. The rule is settled that the non-joinder of indispensable parties is not a ground for the dismissal of an action. The remedy is to implead the non-party claimed to be indispensable. Parties may be added by order of the court on motion of the party or on its own initiative at any stage of the action and/or at such times as are just. If petitioner refuses to implead an indispensable party despite the order of the court, the latter may dismiss the complaint/petition for the plaintiff's/petitioner's failure to comply therewith. 16 AcIaST WHEREFORE, premises considered, the instant petition is GRANTED, and the case is REMANDED to the trial court for appropriate proceedings. The trial court is further DIRECTED to decide on the merits of the civil case WITH DISPATCH. OFFICE OF THE CITY MAYOR OF PARAAQUE CITY, OFFICE OF THE CITY ADMINISTRATOR OF PARAAQUE CITY, OFFICE OF THE CITY ENGINEER OF PARAAQUE CITY, OFFICE OF THE CITY PLANNING AND DEVELOPMENT COORDINATOR, OFFICE OF THE BARANGAY CAPTAIN AND SANGGUNIANG PAMBARANGAY OF BARANGAY VITALEZ, PARAAQUE CITY, TERESITA A. GATCHALIAN, ENRICO R. ESGUERRA, ERNESTO T. PRACALE, JR., MANUEL M. ARGOTE, CONRADO M. CANLAS, JOSEPHINE S. DAUIGOY, ALLAN L. GONZALES, ESTER C. ASEHAN, MANUEL A. FUENTES, and MYRNA P. ROSALES, petitioners, vs. MARIO D. EBIO AND HIS CHILDREN/HEIRS namely, ARTURO V. EBIO, EDUARDO V. EBIO, RENATO V. EBIO, LOURDES E. MAGTANGOB, MILA V. EBIO, and ARNEL V. EBIO, respondents.

VILLARAMA, JR., J p: Before us is a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure, as amended, assailing the January 31, 2007 Decision 1 and June 8, 2007 Resolution 2 of the Court of Appeals (CA) in CA-G.R. SP No. 91350 allegedly for being contrary to law and jurisprudence. The CA had reversed the Order 3 of the Regional Trial Court (RTC) of Paraaque City, Branch 196, issued on April 29, 2005 in Civil Case No. 05-0155. Below are the facts. Respondents claim that they are the absolute owners of a parcel of land consisting of 406 square meters, more or less, located at 9781 Vitalez Compound in Barangay Vitalez, Paraaque City and covered by Tax Declaration Nos. 01027 and 01472 in the name of respondent Mario D. Ebio. Said land was an accretion of Cut-cut creek. Respondents assert that the original occupant and possessor of the said parcel of land was their great grandfather, Jose Vitalez. Sometime in 1930, Jose gave the land to his son, Pedro Vitalez. From then on, Pedro continuously and exclusively occupied and possessed the said lot. In 1966, after executing an affidavit declaring possession and occupancy, 4 Pedro was able to obtain a tax declaration over the said property in his name. 5 Since then, respondents have been religiously paying real property taxes for the said property. 6 Meanwhile, in 1961, respondent Mario Ebio married Pedro's daughter, Zenaida. Upon Pedro's advice, the couple established their home on the said lot. In April 1964 and in October 1971, Mario Ebio secured building permits from the Paraaque municipal office for the construction of their house within the said compound. 7 On April 21, 1987, Pedro executed a notarized Transfer of Rights 8 ceding his claim over the entire parcel of land in favor of Mario Ebio. Subsequently, the tax declarations under Pedro's name were cancelled and new ones were issued in Mario Ebio's name.9 On March 30, 1999, the Office of the Sangguniang Barangay of Vitalez passed Resolution No. 08, series of 1999 10seeking assistance from the City Government of Paraaque for the construction of an access road along Cut-cut Creek located in the said barangay. The proposed road, projected to be eight (8) meters wide and sixty (60) meters long, will run from Urma Drive to the main road of Vitalez Compound 11 traversing the lot occupied by the respondents. When the city government advised all the affected residents to vacate the said area, respondents immediately registered their opposition thereto. As a result, the road project was temporarily suspended. 12 aTAEHc In January 2003, however, respondents were surprised when several officials from the barangay and the city planning office proceeded to cut eight (8) coconut trees planted on the said lot. Respondents filed letter-complaints before the Regional Director of the Bureau of Lands, the Department of Interior and Local Government and the Office of the Vice Mayor. 13 On June 29, 2003, the Sangguniang Barangay of Vitalez held a meeting to discuss the construction of the proposed road. In the said meeting, respondents asserted their opposition to the proposed project and their claim of ownership over the affected property. 14 On November 14, 2003, respondents attended another meeting with officials from the city government, but no definite agreement was reached by and among the parties. 15 On March 28, 2005, City Administrator Noli Aldip sent a letter to the respondents ordering them to vacate the area within the next thirty (30) days, or be physically evicted from the said property. 16 Respondents sent a letter to the Office of the City Administrator asserting, in sum, their claim over the subject property and expressing intent for a further dialogue. 17 The request remained unheeded. Threatened of being evicted, respondents went to the RTC of Paraaque City on April 21, 2005 and applied for a writ of preliminary injunction against petitioners. 18 In the course of the proceedings, respondents admitted before the trial court that they have a pending application for the issuance of a sales patent before the Department of Environment and Natural Resources (DENR). 19

DECISION

On April 29, 2005, the RTC issued an Order 20 denying the petition for lack of merit. The trial court reasoned that respondents were not able to prove successfully that they have an established right to the property since they have not instituted an action for confirmation of title and their application for sales patent has not yet been granted. Additionally, they failed to implead the Republic of the Philippines, which is an indispensable party. Respondents moved for reconsideration, but the same was denied. 21 Aggrieved, respondents elevated the matter to the Court of Appeals. On January 31, 2007, the Court of Appeals issued its Decision in favor of the respondents. According to the Court of Appeals The issue ultimately boils down to the question of ownership of the lands adjoining Cutcut Creek particularly Road Lot No. 8 (hereinafter RL 8) and the accreted portion beside RL 8. The evidentiary records of the instant case, shows that RL 8 containing an area of 291 square meters is owned by Guaranteed Homes, Inc. covered by TCT No. S-62176. The same RL 8 appears to have been donated by the Guaranteed Homes to the City Government of Paraaque on 22 March 1966 and which was accepted by the then Mayor FLORENCIO BERNABE on 5 April 1966. There is no evidence however, when RL 8 has been intended as a road lot. On the other hand, the evidentiary records reveal that PEDRO VITALEZ possessed the accreted property since 1930 per his Affidavit dated 21 March 1966 for the purpose of declaring the said property for taxation purposes. The property then became the subject of Tax Declaration No. 20134 beginning the year 1967 and the real property taxes therefor had been paid for the years 1966, 1967, 1968, 1969, 1970, 1972, 1973, 1974, 1978, 1980, 1995, 1996, 1997, 1998, 1999, 2000, 2001, 2002, 2003, and 2004. Sometime in 1964 and 1971, construction permits were issued in favor of Appellant MARIO EBIO for the subject property. On 21 April 1987, PEDRO VITALEZ transferred his rights in the accreted property to MARIO EBIO and his successors-in-interest. Applying [Article 457 of the Civil Code considering] the foregoing documentary evidence, it could be concluded that Guaranteed Homes is the owner of the accreted property considering its ownership of the adjoining RL 8 to which the accretion attached. However, this is without the application of the provisions of the Civil Code on acquisitive prescription which is likewise applicable in the instant case. DAEaTS xxx xxx xxx The subject of acquisitive prescription in the instant case is the accreted portion which [was] duly proven by the Appellants. It is clear that since 1930, Appellants together with their predecessor-in-interest, PEDRO VITALEZ[,] have been in exclusive possession of the subject property and starting 1964 had introduced improvements thereon as evidenced by their construction permits. Thus, even by extraordinary acquisitive prescription[,] Appellants have acquired ownership of the property in question since 1930 even if the adjoining RL 8 was subsequently registered in the name of Guaranteed Homes. . . . . xxx xxx xxx Further, it was only in 1978 that Guaranteed Homes was able to have RL 8 registered in its name, which is almost fifty years from the time PEDRO VITALEZ occupied the adjoining accreted property in 1930. . . . .

xxx xxx xxx We likewise note the continuous payment of real property taxes of Appellants which bolster their right over the subject property. . . . . xxx xxx xxx In sum, We are fully convinced and so hold that the Appellants [have] amply proven their right over the property in question. WHEREFORE, premises considered, the instant appeal is hereby GRANTED. The challenged Order of the court a quo is REVERSED and SET ASIDE. SO ORDERED. 22 On June 8, 2007, the appellate court denied petitioners' motion for reconsideration. Hence, this petition raising the following assignment of errors: I.WHETHER OR NOT THE DECISION AND RESOLUTION OF THE HONORABLE COURT OF APPEALS THAT RESPONDENTS HAVE A RIGHT IN ESSE IS IN ACCORD WITH THE LAW AND ESTABLISHED JURISPRUDENCE[;] II.WHETHER OR NOT THE DECISION AND RESOLUTION OF THE HONORABLE COURT OF APPEALS THAT THE SUBJECT LOT IS AVAILABLE FOR ACQUISITIVE PRESCRIPTION IS IN ACCORD WITH THE LAW AND ESTABLISHED JURISPRUDENCE[;] AND III.WHETHER OR NOT THE STATE IS AN INDISPENSABLE PARTY TO THE COMPLAINT . . . FILED BY RESPONDENTS IN THE LOWER COURT. 23 The issues may be narrowed down into two (2): procedurally, whether the State is an indispensable party to respondents' action for prohibitory injunction; and substantively, whether the character of respondents' possession and occupation of the subject property entitles them to avail of the relief of prohibitory injunction. The petition is without merit. EACTSH An action for injunction is brought specifically to restrain or command the performance of an act. 24 It is distinct from the ancillary remedy of preliminary injunction, which cannot exist except only as part or as an incident to an independent action or proceeding. Moreover, in an action for injunction, the auxiliary remedy of a preliminary prohibitory or mandatory injunction may issue. 25 In the case at bar, respondents filed an action for injunction to prevent the local government of Paraaque City from proceeding with the construction of an access road that will traverse through a parcel of land which they claim is owned by them by virtue of acquisitive prescription. Petitioners, however, argue that since the creek, being a tributary of the river, is classified as part of the public domain, any land that may have formed along its banks through time should also be considered as part of the public domain. And respondents should have included the State as it is an indispensable party to the action.

We do not agree. It is an uncontested fact that the subject land was formed from the alluvial deposits that have gradually settled along the banks of Cut-cut creek. This being the case, the law that governs ownership over the accreted portion is Article 84 of the Spanish Law of Waters of 1866, which remains in effect, 26 in relation to Article 457 of the Civil Code. Article 84 of the Spanish Law of Waters of 1866 specifically covers ownership over alluvial deposits along the banks of a creek. It reads: ART. 84.Accretions deposited gradually upon lands contiguous to creeks, streams, rivers, and lakes, by accessions or sediments from the waters thereof, belong to the owners of such lands. 27 Interestingly, Article 457 of the Civil Code states: Art. 457.To the owners of lands adjoining the banks of rivers belong the accretion which they gradually receive from the effects of the current of the waters. It is therefore explicit from the foregoing provisions that alluvial deposits along the banks of a creek do not form part of the public domain as the alluvial property automatically belongs to the owner of the estate to which it may have been added. The only restriction provided for by law is that the owner of the adjoining property must register the same under the Torrens system; otherwise, the alluvial property may be subject to acquisition through prescription by third persons.28 In contrast, properties of public dominion cannot be acquired by prescription. No matter how long the possession of the properties has been, there can be no prescription against the State regarding property of public domain. 29 Even a city or municipality cannot acquire them by prescription as against the State. 30 Hence, while it is true that a creek is a property of public dominion, 31 the land which is formed by the gradual and imperceptible accumulation of sediments along its banks does not form part of the public domain by clear provision of law. Moreover, an indispensable party is one whose interest in the controversy is such that a final decree would necessarily affect his/her right, so that the court cannot proceed without their presence. 32 In contrast, a necessary party is one whose presence in the proceedings is necessary to adjudicate the whole controversy but whose interest is separable such that a final decree can be made in their absence without affecting them. 33 aTcIEH In the instant case, the action for prohibition seeks to enjoin the city government of Paraaque from proceeding with its implementation of the road construction project. The State is neither a necessary nor an indispensable party to an action where no positive act shall be required from it or where no obligation shall be imposed upon it, such as in the case at bar. Neither would it be an indispensable party if none of its properties shall be divested nor any of its rights infringed. We also find that the character of possession and ownership by the respondents over the contested land entitles them to the avails of the action. A right in esse means a clear and unmistakable right. 34 A party seeking to avail of an injunctive relief must prove that he or she possesses a right in esse or one that is actual or existing. 35 It should not be contingent, abstract, or future rights, or one which may never arise. 36

In the case at bar, respondents assert that their predecessor-in-interest, Pedro Vitalez, had occupied and possessed the subject lot as early as 1930. In 1964, respondent Mario Ebio secured a permit from the local government of Paraaque for the construction of their family dwelling on the said lot. In 1966, Pedro executed an affidavit of possession and occupancy allowing him to declare the property in his name for taxation purposes. Curiously, it was also in 1966 when Guaranteed Homes, Inc., the registered owner of Road Lot No. 8 (RL 8) which adjoins the land occupied by the respondents, donated RL 8 to the local government of Paraaque. From these findings of fact by both the trial court and the Court of Appeals, only one conclusion can be made: that for more than thirty (30) years, neither Guaranteed Homes, Inc. nor the local government of Paraaque in its corporate or private capacity sought to register the accreted portion. Undoubtedly, respondents are deemed to have acquired ownership over the subject property through prescription. Respondents can assert such right despite the fact that they have yet to register their title over the said lot. It must be remembered that the purpose of land registration is not the acquisition of lands, but only the registration of title which the applicant already possessed over the land. Registration was never intended as a means of acquiring ownership. 37 A decree of registration merely confirms, but does not confer, ownership. 38 Did the filing of a sales patent application by the respondents, which remains pending before the DENR, estop them from filing an injunction suit? We answer in the negative. Confirmation of an imperfect title over a parcel of land may be done either through judicial proceedings or through administrative process. In the instant case, respondents admitted that they opted to confirm their title over the property administratively by filing an application for sales patent. Respondents' application for sales patent, however, should not be used to prejudice or derogate what may be deemed as their vested right over the subject property. The sales patent application should instead be considered as a mere superfluity particularly since ownership over the land, which they seek to buy from the State, is already vested upon them by virtue of acquisitive prescription. Moreover, the State does not have any authority to convey a property through the issuance of a grant or a patent if the land is no longer a public land. 39 cHDaEI

Nemo dat quod dat non habet. No one can give what he does not have. Such principle is equally applicable even
against a sovereign entity that is the State.

WHEREFORE, the petition is DENIED for lack of merit. The January 31, 2007 Decision, as well as the July 8, 2007 Resolution, of the Court of Appeals in CA-G.R. SP No. 91350 are hereby AFFIRMED. With costs against petitioners.